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1 ASX ANNOUNCEMENT 25 Octber 2017 SYNTONIC SEPTEMBER 2017 QUARTERLY REVIEW Highlights during the quarter include: Syntnic recgnized recrd quarterly peratinal revenue f A$480,382 the third cnsecutive quarter f increasing revenue Freeway technlgies deplyed n ver 19 millin U.S. smartphnes with cntinued grwth in Q2 frm pre-installatin n 10 new Andrid smartphnes Freeway Overpass, the first crss-carrier, paid and spnsred, subscriptin service launched n iphne and Andrid smartphnes in the U.S. with reach t ver 140 millin cnsumers First wave f Overpass marketing initiated with exclusive cverage in the highly influential Variety magazine, fllwed by 1.14 millin views f Syntnic s Life Withut Freeway Overpass vide t drive custmer awareness and acquisitin Onging plans t expand the Freeway Overpass services t Latin America, Sutheast Asia, and Africa End f quarter rbust cash reserves f A$3.74 millin Seattle, United States Syntnic Limited ( Syntnic r Cmpany ), a mbile platfrm and services prvider, is pleased t prvide investrs an update n the Cmpany s activities fr Q1 FY2018 alng with the accmpanying. Gary Greenbaum, CEO and Managing Directr f Syntnic, cmmented: The September quarter was ur third cnsecutive quarter f increasing revenue, and we are highly pleased with the prgress we ve made t date. We have been wrking persistently n the cmmercialisatin and enhancement f ur varius prduct fferings. This laser fcus apprach n grwing the business has resulted in substantive advances f ur Freeway service acrss 4 key perfrmance metrics -revenue, prduct distributin, custmer satisfactin, and custmer acquisitin csts. I m prud t annunce that we have had 9 straight mnths f increasing revenue, cnsumer satisfactin ratings, app dwnlads and usage. In a relatively shrt perid f time, we have received an encuraging receptin f ur Freeway Overpass service, which started generating revenue frm the first day f launch. Our marketing effrts will cntinue t be fcused n driving marketplace success f Overpass in the U.S. and beynd, and we expect revenue t cntinue ramping ver the cming quarters. Majr events ccurred during the Quarter: i. Cmmercial launch f Freeway Overpass n the iphne: With the recent availability f Overpass in the U.S. n the iphne, the new service has achieved an addressable audience reach f ver 140 millin mbile cnsumers in the U.S. The Overpass service launch fr iphne als triggered the first wave f marketing activities t grw custmer awareness and acquisitin principally thrugh direct paid media. Additinally, we realized the benefits f earned and wned media, USA: Syntnic, Inc. 119 First Avenue Suth, Suite 100 Seattle, WA Australia: Syntnic Limited 945 Wellingtn Street West Perth WA 6005 E: ir@syntnic.cm ABN: ASX Cde: SYT

2 such as Freeway Overpass exclusive feature in Variety Magazine, a highly respected nline entertainment magazine with 17 millin unique mnthly visitrs 1 and the Freeway Life Withut Freeway Overpass vide, viewed by nearly 40,000 peple within 2 hurs f the Overpass launch. With nly tw weeks in the quarter t market the Overpass service, all key indicatrs custmer acquisitin cst, registratin rates, app engagement time, subscriber purchases and trials grew psitively, with the expectatin f ramping revenue in subsequent quarters.. Figure 1 Syntnic Overpass User Experience n the iphne ii. Large-scale deplyment f Freeway technlgies n U.S. smartphnes: The September quarter was histric fr the Cmpany with the first massive scale-ut f the Freeway SDK ( Sftware Develpment Kit) n ver 19 millin U.S. iphne and Andrid smartphnes. This deplyment was driven thrugh the SDK s inclusin in data-free apps which were either aut-upgraded r pre-installed n the smartphne. T nte, nt all f the SDK distributin was ryalty bearing because f several factrs: 1) required minimum mbile usage t trigger mnthly ryalties was n achieved, 2) cnservative ramp-up f mbile peratr datafree services thrughut the quarter t assure scalability f their internal netwrk peratins, and 3) much f the deplyment ccurred late in the quarter. iii. This was als the first quarter fr substantial netwrk lad delivered by the Syntnic Cnnected Services Platfrm. Over 3.8PB (petabytes) f netwrk traffic was ruted by the Syntnic services, the equivalent t the data f ver 800,000 DVDs. As annunced subsequent t the quarter s end, Syntnic plans t further expand the Overpass service int new gegraphies in Latin America, Sutheast Asia, and Africa Figure 2: Data-free app supprting the Freeway SDK 1 Surce: BPA Wrldwide, September 2011 USA: Syntnic, Inc. 119 First Avenue Suth, Suite 100 Seattle, WA Australia: Syntnic Limited 945 Wellingtn Street West Perth WA 6005 E: ir@syntnic.cm ABN: ASX Cde: SYT

3 Revenue A$ iv. with the assistance f reginal value-add service prviders that will assist in securing and managing lcal carrier relatinships, custmer service, and cntent prvider acquisitin. Freeway by Syntnic was nminated fr the prestigius Wrld Summit Award 2017 as the sle U.S. representative fr best and mst innvative digital slutin. Operatinal Summary With three cnsecutive quarters f revenue grwth, Syntnic has cntinued t demnstrate steady recurring revenue grwth. Fr Q1 FY2018, Syntnic recgnized revenue f A$480,382. Cash receipts were A$313,428. The difference between recgnized revenue and cash receipts is due t the 30 t 60 day delay in receiving payment n Q1 invices delivered t the custmer. The balance f the cash payable t Syntnic will be received during the current quarter. At the end f the quarter, the Cmpany maintained a cash psitin f A$3,742,932 and cntinues t remain debt free. Revenue Generatin A$432, A$480,382 A$281, Q Q Q Syntnic s revenue was mainly generated thrugh licensing ryalties assciated with the use f the Syntnic platfrm technlgies, i.e. Syntnic s Cnnected Services Platfrm ( CSP ) and the Freeway SDK, and by Freeway s spnsred and subscriptin cnsumer services. Syntnic realized mnth-bymnth grwth in app ryalties and hsting fees with mst f the deplyment ccurring late in the quarter, cnsistent with the carrier s cnservative rll-ut apprach. Given the size f Syntnic s largest licensee, Verizn Wireless, i.e millin eligible subscribers, and ther tier-1 carriers in Syntnic s sales pipeline, the Cmpany anticipates cntinued revenue grwth frm its high-margin, recurring revenue infrastructure licensing business. With the Overpass cmmercial launch ccurring in the last tw weeks f the September quarter, the service nly marginally cntributed t verall reprted revenue fr the quarter; hwever, key indicatrs suggest ramping revenues in upcming quarters. USA: Syntnic, Inc. 119 First Avenue Suth, Suite 100 Seattle, WA Australia: Syntnic Limited 945 Wellingtn Street West Perth WA 6005 E: ir@syntnic.cm ABN: ASX Cde: SYT

4 Prduct Distributin During the September quarter, the Freeway services reflected the largest distributin grwth in cmpany histry with ver 19 millin U.S. smartphnes supprting the Freeway service. The majrity f this distributin resulted frm integratin f the Freeway SDK int its data-free apps available n the app stre and natively pre-installed n tw Andrid smartphnes. Syntnic expects strng grwth f the Freeway services in the current quarter including frm the pre-installatin n 10 new Andrid smartphnes. The Freeway app distributin grew by 14.6% with the largest grwth in the U.S. market generated by the Freeway Overpass ffering. Overpass dwnlads accunted fr 33% f the verall wrldwide Freeway app installatin. Outside f the U.S., the mst significant regin fr app installatins was in Mexic where dwnlads increased by 29.6%. Paid marketing was used t grw custmer acquisitin in Mexic in anticipatin f Freeway Overpass expansin int Latin America. Custmer Satisfactin FREEWAY CUMULATIVE RATINGS Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Syntnic remains cmmitted t cntinuusly imprving the cnsumer experience f the cmpany s prducts with custmer satisfactin as a key tracked metric that is als highly crrelated t increasing custmer engagement, retentin, and referrals. The Cmpany is prud t reprt that the Freeway cumulative Andrid cnsumer ratings have cntinued t increase fr 12 cnsecutive mnths, reaching a new high f (ut f 5.0) at quarter s end. This cntinued grwth in custmer ratings is ntewrthy because increasing a cumulate scre gets increasingly difficult as the custmer base grws and 2) nly 37% f Andrid apps receive a rating abve 4.0 [surce: The Cmpany issued 5 prduct updates during the quarter fr its Freeway fr Andrid app and 2 fr its iphne app. These updates prvided new functinality and enhancements t the user experience cnsistent with Syntnic s cmmitment t its custmer-first cre value. Measures taken t remve suspicius activities have largely eliminated prduct cmprmises experienced in previus quarters, and the Cmpany has instituted frmal internal plicies t quickly address future suspicius activities in a timely manner. USA: Syntnic, Inc. 119 First Avenue Suth, Suite 100 Seattle, WA Australia: Syntnic Limited 945 Wellingtn Street West Perth WA 6005 E: ir@syntnic.cm ABN: ASX Cde: SYT

5 User Acquisitin Csts The initial wave f marketing fr Freeway Overpass was fcused n paid advertising campaigns t drive qualified mbile subscribers thrugh the Overpass funnel: dwnlad, installatin, registratin, and purchase. Paid marketing campaigns cnsumed the majrity f the Cmpany s budgeted marketing expense; hwever, Freeway s custmer acquisitin csts are still well belw industry nrms. Mving frward, the marketing strategy is t shift investment t wned and earned media, such as cmpany wned cntent, scial engagement and press reviews, t achieve n-ging csteffective returns n marketing investments. Freeway (nn-us) Custmer Aqusitin Channels Paid Media 34% Organic 55% Referrals 11% Nn-paid marketing strategies have been used fr expanding the Freeway service in Indnesia, India, and Malaysia. As illustrated abve, nearly tw-thirds f the Freeway dwnlads utside f the U.S. resulted frm nn-paid media channels such as referrals and app stre search. These prven and cst-effective marketing channels are being phased int Overpass marketing t reduce the csts fr qualified custmer acquisitin and paid-subscriber cnversin. Crprate The start f the fiscal year was the first quarter f Syntnic s new Bard in peratin with the electin f Mr. Steve Elfman t the rle Nn-Executive Chairman, replacing Mr. Ian Middlemas wh stepped dwn as part f a planned successin strategy, and the appintment f Mr. Nigel Hennessy as Nn- Executive Directr. Bth are recgnized and prven industry leaders that will assist in taking Syntnic t the next level f business grwth. During the perid, Syntnic hsted a Q&A Investr Webinar sessin fr the investment cmmunity with the CEO and C-Funder Gary Greenbaum and the CTO and C-Funder Rahul Agarwal. This was an pprtunity t present the latest develpments n the Cmpany s prgress and t address questins frm sharehlders. In accrdance with ASX Listing Rule 6.1 cnfirmatin previusly given t the Cmpany, Syntnic prvides the fllwing disclsure fr the September 2017 quarter: USA: Syntnic, Inc. 119 First Avenue Suth, Suite 100 Seattle, WA Australia: Syntnic Limited 945 Wellingtn Street West Perth WA 6005 E: ir@syntnic.cm ABN: ASX Cde: SYT

6 i. There are 166,666,666 Perfrmance Shares n issue that shall cnvert upn Freeway by Syntnic (including the white-label versin f the prduct sld by partners) having an Addressable Audience f 150,000,000 mbile subscribers within a perid f 18 mnths frm 8 July 2016; and ii. There are 166,666,668 Perfrmance Shares n issue that shall cnvert upn the Cmpany entering int revenue generating agreements with respect t Syntnic DataFlex (including the white-label versin f the prduct sld by partners) with 50 businesses within a perid f 24 mnths frm 8 July 2016, It is nted that 166,666,666 Perfrmance Shares cnverted t rdinary shares during the March 2017 quarter upn achievement by the Cmpany f its first milestne as disclsed in the Prspectus dated 13 May N further milestnes were achieved during the September 2017 quarter and therefre n Perfrmance Shares were cnverted t rdinary shares. The remaining Perfrmance Shares will lapse if the milestnes are nt achieved within tw years, being 8 July Abut Syntnic Syntnic (SYT.ASX) is a Seattle based sftware cmpany which has develped tw mbile technlgy services: Freeway by Syntnic, which allws cnsumers unlimited mbile access t cntent and applicatins, supprted by subscriptin and spnsrship; and Syntnic DataFlex, which enables businesses t manage split billing expenses fr emplyees when using their persnal mbile phnes fr wrk. Funded in 2013, Syntnic has develped wrldwide strategic partnerships with leaders in the mbile ecsystem. T learn mre abut Syntnic, visit Fr further enquiries, please cntact: Gary Greenbaum CEO and Managing Directr, Syntnic E: ir@syntnic.cm USA: Syntnic, Inc. 119 First Avenue Suth, Suite 100 Seattle, WA Australia: Syntnic Limited 945 Wellingtn Street West Perth WA 6005 E: ir@syntnic.cm ABN: ASX Cde: SYT

7 Quarterly reprt fr entities subject t Listing Rule 4.7B +Rule 4.7B Quarterly reprt fr entities subject t Listing Rule 4.7B Intrduced 31/03/00 Amended 30/09/01, 24/10/05, 17/12/10, 01/09/16 Name f entity Syntnic Limited ABN Quarter ended ( current quarter ) September 2017 Cnslidated statement f cash flws 1. Cash flws frm perating activities 1.1 Receipts frm custmers 1.2 Payments fr (a) research and develpment Current quarter Year t date (3 mnths) (419) (419) (b) prduct manufacturing and perating csts - - (c) advertising and marketing (433) (433) (d) leased assets - - (e) staff csts (497) (497) (f) administratin and crprate csts (141) (141) 1.3 Dividends received (see nte 3) Interest received Interest and ther csts f finance paid (1) (1) 1.6 Incme taxes paid Gvernment grants and tax incentives Other (prvide details if material) Net cash frm / (used in) perating activities (1,158) (1,158) 2. Cash flws frm investing activities 2.1 Payments t acquire: (a) prperty, plant and equipment - - (b) businesses (see item 10) - - (c) investments See chapter 19 fr defined terms 1 September 2016 Page 1

8 Quarterly reprt fr entities subject t Listing Rule 4.7B Cnslidated statement f cash flws Current quarter Year t date (3 mnths) (d) intellectual prperty - - (e) ther nn-current assets Prceeds frm dispsal f: (a) prperty, plant and equipment - - (b) businesses (see item 10) - - (c) investments - - (d) intellectual prperty - - (e) ther nn-current assets Cash flws frm lans t ther entities Dividends received (see nte 3) Other (prvide details if material): (a) cash acquired n reverse acquisitin (b) transactin csts f reverse acquisitin Net cash frm / (used in) investing activities Cash flws frm financing activities 3.1 Prceeds frm issues f shares Prceeds frm issue f cnvertible ntes Prceeds frm exercise f share ptins Transactin csts related t issues f shares, cnvertible ntes r ptins Prceeds frm brrwings Repayment f brrwings Transactin csts related t lans and brrwings Dividends paid Other (prvide details if material) Net cash frm / (used in) financing activities Net increase / (decrease) in cash and cash equivalents fr the perid 4.1 Cash and cash equivalents at beginning f quarter/year t date 4,910 4, Net cash frm / (used in) perating activities (item 1.9 abve) (1,158) (1,158) 4.3 Net cash frm / (used in) investing activities (item 2.6 abve) See chapter 19 fr defined terms 1 September 2016 Page 2

9 Quarterly reprt fr entities subject t Listing Rule 4.7B Cnslidated statement f cash flws Current quarter Year t date (3 mnths) 4.4 Net cash frm / (used in) financing activities (item 3.10 abve) Effect f mvement in exchange rates n cash held (9) (9) 4.6 Cash and cash equivalents at end f quarter 3,743 3, Recnciliatin f cash and cash equivalents at the end f the quarter (as shwn in the cnslidated statement f cash flws) t the related items in the accunts Current quarter Previus quarter 5.1 Bank balances 3,679 4, Call depsits Bank verdrafts Other (AmEx depsit) Cash and cash equivalents at end f quarter (shuld equal item 4.6 abve) 3,743 4, Payments t directrs f the entity and their assciates Current quarter $A' Aggregate amunt f payments t these parties included in item Aggregate amunt f cash flw frm lans t these parties included in item Include belw any explanatin necessary t understand the transactins included in items 6.1 and 6.2 Payments include executive directrs wages, assciated payrll expenses, and prvisin f sftware engineering services. 7. Payments t related entities f the entity and their assciates Current quarter $A' Aggregate amunt f payments t these parties included in item Aggregate amunt f cash flw frm lans t these parties included in item Include belw any explanatin necessary t understand the transactins included in items 7.1 and 7.2 Nt applicable. + See chapter 19 fr defined terms 1 September 2016 Page 3

10 Quarterly reprt fr entities subject t Listing Rule 4.7B 8. Financing facilities available Add ntes as necessary fr an understanding f the psitin Ttal facility amunt at quarter end Amunt drawn at quarter end 8.1 Lan facilities Credit standby arrangements Other (please specify) Include belw a descriptin f each facility abve, including the lender, interest rate and whether it is secured r unsecured. If any additinal facilities have been entered int r are prpsed t be entered int after quarter end, include details f thse facilities as well. Nt applicable. 9. Estimated cash utflws fr next quarter 9.1 Research and develpment (400) 9.2 Prduct manufacturing and perating csts Advertising and marketing (400) 9.4 Leased assets Staff csts (450) 9.6 Administratin and crprate csts (150) 9.7 Other (prvide details if material) Ttal estimated cash utflws (1,400) 10. Acquisitins and dispsals f business entities (items 2.1(b) and 2.2(b) abve) Acquisitins Dispsals 10.1 Name f entity Place f incrpratin r registratin 10.3 Cnsideratin fr acquisitin r dispsal Ttal net assets Nature f business See chapter 19 fr defined terms 1 September 2016 Page 4

11 Quarterly reprt fr entities subject t Listing Rule 4.7B Cmpliance statement 1 This statement has been prepared in accrdance with accunting standards and plicies which cmply with Listing Rule 19.11A. 2 This statement gives a true and fair view f the matters disclsed. Sign here:... Date: 25 Octber 2017 (Directr/Cmpany secretary) Print name: Kate Sainty Ntes 1. The quarterly reprt prvides a basis fr infrming the market hw the entity s activities have been financed fr the past quarter and the effect n its cash psitin. An entity that wishes t disclse additinal infrmatin is encuraged t d s, in a nte r ntes included in r attached t this reprt. 2. If this quarterly reprt has been prepared in accrdance with Australian Accunting Standards, the definitins in, and prvisins f, AASB 107: Statement f Cash Flws apply t this reprt. If this quarterly reprt has been prepared in accrdance with ther accunting standards agreed by ASX pursuant t Listing Rule 19.11A, the crrespnding equivalent standard applies t this reprt. 3. Dividends received may be classified either as cash flws frm perating activities r cash flws frm investing activities, depending n the accunting plicy f the entity. + See chapter 19 fr defined terms 1 September 2016 Page 5