Appendix 1 – Preliminary Report 1H FY2018 (unaudited)

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
Appendix 1 (NZAX Listing Rule 10.4.1)
Half year preliminary announcement
Results for announcement to the market
Basis of reportUnaudited
Reporting period
6 months to 31 December 2017
Previous reporting period
6 months to 31 December 2016
Amount
$NZ000
Percentage
Change
Total revenue
11,292 10.8%
Revenue from ordinary activities
11,130 9.7%
Operating Profit before revaluations and income tax (“Operating Earnings”)
1,171 25.0%
Operating Profit before interest, impairment, revaluations, income tax and depreciation (“Operating EBITDA”)
1,324 14.6%
Reported Profit from ordinary activities after tax attributable to security holders (“Reported NPAT”)
832 18.2%
Profit for the period net of tax attributable to security holders
827 16.3%
Dividend
Amount per
security
Imputed
amount per
Interim
0.04000$ 0.01556$
Record date
6 April 2018
Dividend payment date
13 April 2018
Current reporting
period
Prior reporting
period
Net tangible assets per security
0.39762$ 0.342$
Commentary on results
For commentary on the results please refer to the
commentary on the related NZX release.
Notes
1)The above information should be read in conjunction with the attached preliminary detailed financial reporting for the 6-month period
ending 31 December 2017.

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
1CONSOLIDATED STATEMENT OF FINANCIAL Current*Up/DownPrevious
PERFORMANCEhalf Year%half year
$NZ'000$NZ'000
1.1
(a)Trading Revenue
11,130 9.7%10,146
(b)Other Revenue
162 295.1%41
(c)Total Operating Revenue
11,292 10.8%10,187
1.2
1,171 25.0%937
(a)Less taxation on operating result
(339) (233)
1.3
832 18.2%704
(a)Extraordinary Items after Tax [detail in Item 3]
(5) n/a7
(b)Unrealised net change in value of investment properties
- - -
1.4
827 16.3%711
(a)Net *Surplus (Deficit) attributable to minority interests
- -
1.5
827 16.3%711
2CurrentPrevious
half yearhalf year
$NZ'000$NZ'000
2.1
(a)Interest revenue included in Item 1.1(b)
(b)# Unusual items for separate disclosure (gain/loss) (detail - Item 3)
(c)Equity earnings (gain/loss) (detail - Item 16)
(d)Interest expense included in Item 1.2 (include all forms of interest, etc)( 2) 2
(e)Leasing and renting expenses352 341
(f)Depreciation102 107
(g)Diminuton in the value of assets (other than depreciation)
- -
(h)Amortisation of goodwill
(i)Amortisation of other intangible assets53 32
(j)Impairment of goodwill
- -
(k)Impairment of other intangible assets
- -
Previous
Currentcorresponding
half Yearhalf Year
2.2$NZ'000$NZ'000
(a)# Interest costs excluded from Item 2.1(d) and capitalised
- -
(b)# Outlays (other than those arising from the acquisition of an existing
- -
business) capitalised in intangibles-
(c)Unrecognised differences between the carrying value and market value
- -
of publicly traded investments
#Items marked in this way need to be shown only there their inclusion as revenue
or exclusion from expenses has had a material effect on reported *surplus (deficit)
SUPPLEMENTARY ITEMS
INCLUDED IN CONSOLIDATED STATEMENT OF FINANCIAL
PERFORMANCE
Consolidated Statement of
Financial Performance
*Consolidated Statement of
Financial Performance
DETAILS OF SPECIFIC RECEIPTS/OUTLAYS, REVENUES/
EXPENSES FOR REPORTING PERIOD
*Consolidated Statement
NET *SURPLUS (DEFICIT) FOR THE PERIOD
OF THE LISTED ISSUER
Financial Performance
OPERATING REVENUE
OPERATING *SURPLUS (DEFICIT) BEFORE TAXATION
OPERATING *SURPLUS (DEFICIT) AFTER TAX
NET SURPLUS (DEFICIT) ATTRIBUTABLE TO MEMBERS

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
3
OperatingOperating
RevenueSurplus
DETAILS AND COMMENTS$NZ'000$NZ'000
Discontinued Activities:
- -
(Disclose Operating Revenue and Operating Surplus)
- -
TOTAL DISCONTINUED ACTIVITIES
- -
Material Unusual (including Non Recurring) Items (included in 1.2)
- -
Description:
Exchange adjustment on international subsidiary
(5) 7
- -
TOTAL MATERIAL NON RECURRING ITEMS
Extraordinary Items (Ref. Item 1.3(a))
- -
Description:
TOTAL EXTRAORDINARY ITEMS
(5) 7

4CurrentPrevious
half yearhalf year
$NZ'000$NZ'000
4.1827 711
(a)*Net Surplus (Deficit) attributable to minority interest
- -
4.2OTHER RECOGNISED REVENUE AND EXPENSES
(a)*Increases (decreases) in revaluation reserves
- -
(b)Current Translation Differences
- -
(c)Minority interest in other recognised revenue and expenses
- -
4.3TOTAL RECOGNISED REVENUES AND EXPENSES827 711
4.4OTHER MOVEMENTS
(a)Contributions by Owners71
(b)Distributions to Owners( 457) ( 316)
(c)Other (Employee Share Plan / Currency Translation Reserve)9 18
4.5EQUITY AT BEGINNING OF FULL YEAR3,519 2,980
4.6EQUITY AT END OF FULL YEAR3,969 3,393
5CurrentPrevious
Calculation of basic and fully diluted, EPS in accordance with IAS33: Earnings half yearhalf year
Per Share$NZ'000$NZ'000
(a)Basic EPS0.058$ 0.050$
(b)Diluted EPS0.057$ 0.048$
EARNINGS PER SECURITY
In Equity
STATEMENT OF MOVEMENTS IN EQUITY
*NET SURPLUS (DEFICIT) ATTRIBUTABLE TO MEMBERS OF LISTED ISSUER
Earnings Per Security
Group - Current
EXTRAORDINARY ITEMS OF THE GROUP
half Year
Statement of Movements
DISCONTINUED, UNUSUAL (INCLUDING NON RECURRING), AND

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
6
(a)Name of subsidiary or group of subsidiariesn/a
(b)Percentage of ownership acquired-
(c)Contribution to consolidated net *Surplus (Deficit) (Item 1.4)$
(d)Date from which such contribution has been calculated-
-
7
(a)Name of subsidiary or group of subsidiariesn/a
(b)Contribution to consolidated net *Surplus (Deficit) (Item 1.4)$
(c)Date from which such contribution has been calculated
(d)Contribution to consolidated net *Surplus (Deficit) (Item 1.4) for the
previous corresponding full year
(e)Contribution to consolidated net *Surplus (Deficit) (Item 1.4) from sale
of subsidiary$
8
Information on the industry and geographical segments of the Listed Issuer is to be reported for the full year in accordance with the provisions of SSAP:23:
Financial Reporting for Segments. Because of the differing nature and extent of segments among Listed Issuers, no complete proforma is provided,
and the segment information should be completed separately and attached to this report. However, the following shows a suitable list of items for
presentation and indicates which amounts should agree with items included elsewhere in the full year report:
SEGMENTS
$NZ'000%$NZ'000%
* Software & Technology
2,933 26%2,424 24%
* Digital printing & Document Handling
3,381 30%3,398 33%
* Outsourced Services
4,978 44%4,365 43%
Total revenue [consolidated total equal to Item 1.1(c) above]
11,292 100%10,187 100%
−
Less cost of sales
7,080 63%6,348 62%
Gross margin4,212
37%
3,839
38%
−
Selling General & Administrations Overheads2,888
26%
2,761
27%
Earnings before interest, tax, depreciation & amortisation1,324
12%
1,078
11%
Less:
−
Restructuring
0%0%
−
Depreciation102
1%
107
1%
−
Amortisation53
0%
32
0%
−
Interest(2)
0%
2
0%
−
Tax339
3%
233
2%
Operating surplus (Deficit) after tax (Item 1.3)832
7%
704
7%
6-mths Dec '176-mths Dec '166-mths Dec '176-mths Dec '16
$NZ'000$NZ'000$NZ'000$NZ'000
* New Zealand
9,331 8,747 1,959 2,105
* Australia
218 183
* UK & Europe
1,743 1,257
−
Total revenue [consolidated total equal to Item 1.1(c) above]
11,292 10,187 1,959 2,105
Industry
Geographical Information
6-mths Dec '17
Revenue
MATERIAL DISPOSALS OF SUBSIDIARIES (See Note (VII) attached)
REPORTS FOR INDUSTRY AND GEOGRAPHICAL SEGMENTS
6-mths Dec '16
Non-current Assets
MATERIAL ACQUISITIONS OF SUBSIDIARIES (See Note (VII) attached):
The Group supplies customer communication solutions. These include a range of integrated document management products and services separated into three
streams; software & technology services, digital printing & document handling services and outsourced services. Specific elements of these streams are as follows:
Software & Technology, Solution Dynamics owns the intellectual property in four products;
Déjar, an online digital archival and retrieval system sold stand-alone under licence agreements and also as a hosted service inNew Zealand and
Internationally.
Bremy, Digital asset management, workflow and multichannel publishing software sold as a licenced product and also as a hosted service in New Zealand,
Australia and the UK.
Composer, “On-Demand” content creation software.
DéjarMail, is a web browser-based desktop mail management solution which allows customers to route mail correspondence to SDL orany other service
provider for printing and delivery.
In addition to owning the intellectual property for the above products, Solution Dynamics provides programming, consulting and design services that help clients to
distribute marketing and essential communications by mail and electronically. The provision of these services is covered under this category.
Digital Printing & Document Handling Services,the printing of client’s information digitally using high speed laser printers followed by the lodgement and
distribution of those documents using a variety of machine and other processes.
Outsourced Services, not all components of Solution Dynamics’ solutions are produced internally. External elements such as post, freight, paperand envelopes are
sourced from external suppliers and included in this service stream. Solution Dynamics has long term arrangements with a numberof key suppliers such as NZ Post
for the provision of these services.
An overhead structure including sales, marketing and administration departments provides services for all of the above revenue streams.
There are no reconciling items in this note due to the management information provided to the Chief Operating Decision Maker being compiled using the
same standards and accounting policies as those used to prepare the financial statements.

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
At end ofAs shown inIf half yearly
currentlastas shown in last
9CURRENT ASSETS:
half YearAnnual Report half yearly report
$NZ'000$NZ'000$NZ'000
(a) Trade receivables & other current assets2,214 2,366 1,841
(b) Cash2,408 2,080 1,858
(c) Inventories156 152 149
(d)Prepayments182 96 120
TOTAL CURRENT ASSETS4,960 4,694 3,968
9.1NON-CURRENT ASSETS
(a) Trade receivables
- - -
(b) Investments
- - -
(c) Inventories
- - -
(d) Property, plant and equipment607 668 833
(e)Goodwill938 938 938
(f)Deferred Taxation Assets
99 108 76
(g)Other Intangible Assets315
294
258
(h)Other assets, non current
- - -
9.21,959 2,008 2,105
9.3TOTAL ASSETS6,919 6,702 6,073
9.4CURRENT LIABILITIES
(a)Finance facility
(b) Trade Creditors1,517 1,428 1,398
(c)Income in advance56 188 115
(d)Borrowings
(e)Other non-financial liabilities388 405 312
(f)Employee benefit liabilities420 447 431
(g)Other liabilities, current569 715 424
TOTAL CURRENT LIABILITIES2,950 3,183 2,680
9.5NON-CURRENT LIABILITIES
(a)Accounts payable, non-current
(b)Secured loans- -
(c) Unsecured loans- - -
(d)Provisions, non-current- - -
(e)Deferred Taxation Liability, non-current- - -
(f)Other liabilities, non-current- - -
9.6- - -
9.7TOTAL LIABILITIES2,950 3,183 2,680
9.8NET ASSETS3,969 3,519 3,393
9.9SHAREHOLDERS' EQUITY
(a) Share capital (optional)5,240 5,169 5,169
(b) Reserves (optional) (i) Currency translation reserve(4) 1 7
(ii) Other reserves (Employee Share Plan)86 113 95
(c) Retained Surplus (accumulated Deficit) (optional)(1,353) (1,764) (1,878)
9.1O3,969 3,519 3,393
(a)Minority equity interests in subsidiaries
- - -
9.113,969 3,519 3,393
(a)Returns on Assets (%) (EBIT divided by Total Assets)16.90%26.87%15.46%
(b)Return on Equity (%) (Net Income divided by Shareholders'
Equity)22.09%40.31%22.31%
(c) Debt to Equity Ratio (%) (Total Liabilities divided by74.33%90.45%78.99%
Shareholders' Equity)
n/a5,666 5,470 4,877
(a)Net Tangible Assets Amount per Security0.398$ 0.384$ 0.342$
OF THE LISTED ISSUER
TOTAL SHAREHOLDERS' EQUITY
TANGIBLE ASSETS
(Note (VIII) attached has particular relevance for the preparation
TOTAL NON-CURRENT ASSETS
TOTAL NON-CURRENT LIABILITIES
SHAREHOLDERS' EQUITY ATTRIBUTABLE TO MEMBERS
Consolidated Statement of Financial Position

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
CurrentPrevious
10CASH FLOWS RELATING TO OPERATING ACTIVITIEShalf yearhalf year
$NZ'000$NZ'000
(a) Receipts from customers12,766 11,526
(b) Interest received
(c) Dividends received
- -
(d) Payments to suppliers and employees(11,751) (10,495)
(e) Interest paid
(f) Income taxes paid(350) (118)
(g) Other cash flows relating to operating activities162 41
NET OPERATING FLOWS827 954
(See Note (IX) attached )
11CASH FLOWS RELATING TO INVESTING ACTIVITIES
(a) Cash proceeds from sale of property, plant and equipment
- -
(b) Cash proceeds from sale of equity investments
- -
(c) Loans repaid by other entities
- -
(d) Cash paid for purchases of property, plant and equipment & software(115) (190)
(e) Interest paid - capitalised
- -
(f) Cash paid for purchases of equity investments - Bremy NZ & UK
- -
(g) Loans to other entities
- -
(h) Other cash flows relating to operating activities
- -
NET INVESTING CASH FLOWS(115) (190)
(See Note (IX) attached )
12CASH FLOWS RELATED TO FINANCING ACTIVITIES
(a) Cash proceeds from issue of shares, options, etc & interest income
71 -
(b) Borrowings
- -
(c) Repayment of borrowings(10)
(d) Dividends paid
(457) (316)
(e) Other cash flows relating to financing activities - interest on financing2 (2)
NET FINANCING CASH FLOWS(384) (328)
(See Note (IX) attached )
13NET INCREASE (DECREASE IN CASH HELD)
(a) Cash at beginning of full year2,080 1,422
(b) Exchange rate adjustments to Item 12.3(a) above
- -
(c) CASH AT END OF PERIOD2,408 1,858
14NON-CASH FINANCING AND INVESTING ACTIVITIES
and liabilities but did not involve cash flows:
`
15
CurrentPrevious
Bank, Petty Cash and NZAX Deposithalf Yearhalf Year
NZ$'000NZ$'000
Cash at the end of the full year as shown in the statement of cash flows is
2,408 1,858
- -
- -
Total = Cash at End of Period (Item 13(c) above)2,408 1,858
Bank overdraft (ANZ)
Other - NZAX Deposit
For the purposes of the above Statement of cash flows, cash includes:
reconciled to the related items in the financial statements as follows:
Cash on hand and at bank
Deposits at call
of cashflows for half year
(See Note (IX) attached )
Provide details of financing and investing transactions which have had a material effect on group assets and
RECONCILIATION OF CASH
Consolidated Statement

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
16
16.1
Equity Earnings
CurrentPrevious
half yearhalf year
$NZ'000$NZ'000
(a)OPERATING *SURPLUS (DEFICIT) BEFORE TAXn/an/a
(b)Less tax
(c)OPERATING *SURPLUS (DEFICIT) AFTER TAX
(i) Extraordinary items
(d)NET *SURPLUS (DEFICIT) AND EXTRAORDINARY ITEMS AFTER TAX
16.2
(a)The group has a material (from group's viewpoint) interest in the following corporations:
Percentage of ordinaryContribution to net
Name*surplus (deficit)
Full Year(Item 1.5)
Equity Accounted CurrentPreviousCurrentPrevious
AssociatesFull Yearhalf Yearhalf Yearhalf Year
NZ$'000NZ$'000
Equity Accounted in current year
n/an/an/an/a
Other Material Interests
Not Equity Accounted in current year
n/an/an/an/a
(b)Investments in AssociatesCurrentPrevious
half Yearhalf Year
$NZ'000$NZ'000
Carrying value of investments in associates beginning of full yearn/an/a
Share of changes in associates' post acquisition surpluses/and reserves:
- Retained surplus
- Reserves
Net goodwill amortisation and impairment adjustments in the period
Less Dividends received in the period
Equity carrying value of investments at the end of full year
Amount of goodwill included in carrying value at end of that full year
is to be disclosed by way of separate note below (refer FRS-38 Accounting for Investments in Associates).
GROUP SHARE OF RESULTS OF ASSOCIATES
MATERIAL INTERESTS IN CORPORATIONS NOT BEING SUBSIDIARIES
shares held at end of
EQUITY ACCOUNTED INVESTMENTS IN ASSOCIATES
Information attributable to the reporting group's share of investments in associates and other material interests

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
17
Number NumberPaid-Up Value
Category of Securities Issued Quoted(If not halfy paid)
PREFERENCE SHARES:
# (Description)n/an/a
Issued during current full year
ORDINARY SHARES:
14,249,8105,240,000$ 14,249,8105,240,000$
Issued during current full year
-$ 00
CONVERTIBLE NOTES
# (Description)n/an/a
Issued during current full year
OPTIONS:
IssuedQuotedExercise PriceExpiry Date
Issued during current full year
--$
--$
DEBENTURES - Totals only:$n/a
UNSECURED NOTES - Totals only:$n/a
OTHER SECURITIES$n/a
18
If no report in any section, state NIL. If insufficient space below, provide details in the form of notes to be attached
(a)Material factors affecting the revenues and expenses of the group for the current full year
Refer NZX release date 23 February 2018
(b)Significant trends or events since end of current full year
Refer NZX release date 23 February 2018
(c)Changes in accounting policies since last Annual Report and/or last Half Yearly to be disclosed
(d)Critical Accounting Policies - Management believes the following to be critical accounting policies. That is they
are both important to the portrayal of the Issuer's financial condition and results, as they require management to
make judgments and estimates about matters that they are inherently uncertain
ISSUED AND QUOTED SECURITIES AT END OF REPORTING PERIOD
# Description includes rate of dividend or interest and any redemption or conversion rights together with the prices and dates thereof.
COMMENTS BY DIRECTORS
to this report.
-Estimated Impairment of Goodwill and Intangible Assets
The test for impairment of goodwill and intangible assets is undertaken on an anual basis at financial year end. No
impairment test has been performed at Interim balance date.
-Useful lives of Property, Plant & Equipment
As described at 2.1 above, the Company reviews the estimated useful lives of property, plant and equipment at the end of
each annual reporting period. In assessing the useful lives of property, plant & equipment the Company makes reference
to tax rates and these are used where they approximate estimates of useful lives. The carrying amount as at 31 December
2017 was $607,000.
-Contingent Consideration in Respect to Business Combinations
Not applicable

Solution Dynamics Limited ("SDL")
Appendix 1 (Rule B10.4.1)
Preliminary Interim 2018 Report
(e)Management's discussion and analysis of financial condition, result and/or operations (optional) - this section
should contain forward looking statements that should outline where these involve risk and uncertainty
Refer NZX release date 23 February 2018
(f)Other comments
Refer NZX release date 23 February 2018
19
(a)Dividend Yield as at balance date (%) (Annual dividend per share divided by price per share
3.10%
(b)Tax Adjusted Dividend Yield as at balance date (%) (Annual net dividend per share divided by price per share)
3.10%
20
(a)
n/a
(b) Date - 28 October 2010n/aTime
n/a
(c) Approximate date of availability of Annual Report
23-Feb-18
(signed by) Authorised Officer of Listed Issuer
*Delete as required
DIVIDEND
ANNUAL MEETING (if full year report)
If this full year report was approved by resolution of the Board of Directors, please indicate date of meeting:
(date)