Investor Relations

M.D.`s Address to AGM

Back Nov 24, 2000
Q MULTIMEDIUM LIMITED                         2000-11-24  ASX-SIGNAL-G

HOMEX - Perth                                                         

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GENERAL

In the last 10 months the directors and staff have been extremely
active building our core business revenue streams, whilst extending
the range of 'new media' products services, including some 'blue sky'
opportunities in the Wireless Internet environment, through our 50%
acquisition in Jumbuck. Throughout this period management has also
been rigorously pursuing a programme to drastically reduce costs.
These strategies are now bearing fruit. Early in the new year Q
Multimedium will be in a cash-flow positive situation, and will
rapidly move into profit. In fact we are in a moving into a phase
where the investment Q has made in people and the development of
intellectual property has given Q considerable competitive advantage,
and we are beginning to see how this will underpin future growth.

SPORTS DISC

In the prospectus Q made no prediction of sales for the Sports Discs,
however we did indicate that we would be marketing the discs through
retail outlets, which we did.

Sales of the discs did not achieve expected volumes, mainly because
the mini disc concept was ahead of its time. Our research indicated
that kids really liked playing with sports discs, but we couldn't
persuade the distributors to really get behind the product because
they didn't understand it - Also it is a very low margin product for
retailers.

After a few months we changed both the investment strategy and the
marketing strategy for the Q Sport discs.

As far as investment in the disc was concerned, where possible we
stopped any product development, unless it was being paid for by a
publisher or sponsor - this strategy continues and has recently seen
success with Q winning a contract with the AFL for the production of
105,000 discs paid for on a contract basis.

As far as marketing the discs, all retail marketing was terminated,
and we focused on marketing the mini discs concept to sponsors and/or
publishers - a strategy that continues today and evidenced by the
fact of the just mentioned AFL contract and the number of proposal we
currently have under serious consideration by major sports and
consumer goods companies. 

MULTIMEDIA AND DIGITAL

Since changing the Sports Disc strategy we have also re-invigorated
our efforts to win contract based business for our core 'new media'
and 'digital pre-press' business. The digital business continues to
generate strong revenues for the business.

Our new media business has extended the product and services they
offer to include not only high grade multimedia, but also web
development, e-commerce and e-business consultancy. These strategies
have taken some time to begin to have an impact on our revenues, but
we now know for certain that they have been highly successful. Today,
Q Multimedium Ltd announced the signing of a contract with
GranadaWest, a joint venture between ScreenWest Inc and the Granada
Media Group. The contract requires QMM to provide a complete
Technical Specification for a Digital Asset Management system being
developed by GranadaWest.

The contract also grants QMM "first negotiation" rights for provision
of services to implement the findings of the Technical Specification.
Granada is one of the UK's largest media groups with a market cap
well over 15 billion dollars and substantial assets in Australia.

In another exciting area - our venture into Wireless Internet
technology with Jumbuck is proving to be successful. The contract
with Sprint PCS in the USA (America's largest all digital mobile
network, with over 8 million customers) has demonstrated that Jumbuck
really has developed world-leading technology. In the next quarter we
estimate that WAP phone users all over the world will spend over 6
million minutes using Jumbuck WAP Chatrooms.

THE FUTURE

Where will Q Multimedium be in a year?

Q will continue to build their core digital and multimedia business
revenues, but we will see a greater contribution from our offices in
Singapore and Melbourne.

In the near future you will also see Q confirm strategic partnerships
with global organizations in the technology and consultancy segments,
similar to the Granada West contract announced this morning. These
strategic alliances will see Q gain access to larger clients with
more money to spend on new media solutions. Through these same
alliances we will also see Q access scaleable online revenues on a
global basis, through shared ownership of proprietary software and
services. Jumbuck will also become a major global provider of
wireless messaging applications with representation beyond these
shores.

Throughout this period the directors of Q Multimedium will continue
to exercise tight control on the expense side of the ledger, and
wherever possible seek to reduce risk to a minimum. We are confident
that the mix of experience and innovation that resides within the
management and staff of Q will deliver the shareholder value you
require.

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