Abridged Audited Group Annual Financial Statements

ABRIDGED AUDITED GROUP ANNUAL FINANCIAL STATEMENTS FOR THE
YEAR ENDED 28 FEBRUARY 2010, NOTICE OF ANNUAL GENERAL MEETING and notice of declaration of dividend

highlights

• Revenue increased by 51% to R106.5 million
• Operating profit increased by 134%
• Profit for the year increased by 118%
• Earnings per share and headline earnings per share increased by 113% and 112% respectively

financial review

The Group performed well during the year under review, increasing headline earnings per share to 39.74 cents per share from 18.78 cents per share in the previous financial year. Our revenue increased by 51% from R70.6 million to R106.5 million whilst our net margins improved from 10% to 15%. We experienced healthy organic growth in implementation income supported by annuity income streams. The successful acquisition of Acczone Systems (Proprietary) Limited, an established software provider of loan administration solutions, is another building block in the SilverBridge house. The Group measures performance across five main business segments – implementation, support, software rental, consulting and research and development. The support and software rental revenue segments are annuity revenue segments.

GROUP PROFILE

SilverBridge is Africa's leading provider of administration software and IT consultation in financial services. Our unique expertise covers many of the financial services verticals with specific focus on banking and life assurance. Constant changes in the market require both a nimble and innovative approach from financial services providers. SilverBridge has a track record for delivering solutions to help our clients to be more successful in this challenging market. The future of financial services holds many challenges for providers; the astonishing speed at which technology is changing and influencing the behaviour of new generations will require a new approach to financial services. SilverBridge is committed to be part of that new future. The Group operates through the following three subsidiaries:

SDT Financial Software Solutions (Proprietary) Limited (SDT) – Life insurance administration

SDT offers life assurance companies quick time to market, reduced contract administration costs and enhanced customer service. SDT was established in 1995 and has developed and streamlined its own software which it sells on a rental model. SDT's flagship software, Exergy, with its supporting services, is packaged to meet the needs of the different market segments in which it operates.

Ones & Zeros Professional Services (SA) (Proprietary) Limited (Ones & Zeros) – Consulting

Founded In 1997, Ones & Zeros is an established IT management consulting business. Its approach is to bring people and technology together. Services include strategic systems implementation and consulting, which aligns business processes with an organisation's overall IT strategy. It has well established relationships within the banking sector which add to the credibility of the Group.

Acczone Systems (Proprietary) Limited (Acczone) – Loans administration

The recent acquisition of Acczone is a demonstration of SilverBridge's commitment to servicing the various verticals in the financial services industry. Acczone was established in 1998 and has a core competency in the delivery of business systems solutions in the loan administration sector, which encompasses interest-bearing credit and debt administration.

GROUP OUTLOOK

It has been a very successful year for SilverBridge, not only in presenting a turnaround in the financial results, but also in its improved positioning and market share. The Group's outlook for the 2011 financial year is positive, but not without challenges and risks. We will endeavour to:

• secure work in targeted markets;
• improve efficiencies;
• further improve the alignment of capacity to available work;
• package products and services in line with the different market segments;
• capitalise on the scalability of the business and revenue models;
• plan expansion into new markets; and
• expand into the other verticals of financial services.

The economic downturn is likely to have some residual effects on our industry and our markets. We have taken this into account in our business plans and general approach. We are conservative in our growth objectives but will take into consideration suitable opportunities. The Group enters the new financial year with an overflow of project transactions concluded in the preceding financial year, stable software rental and support annuity revenue streams and expansion of consulting services in the banking industry. As such, our prospects remain sound for the year ahead.

OPERATIONAL HIGHLIGHTS

Our consulting subsidiary, Ones & Zeros, has leaded a consortium to replace the banking system at Mercantile Bank Holdings Limited. The project is in the process of being concluded after running for more than two years.

We managed to extend our market share in the life insurance sector by a number of new clients. The conclusion of the contract with ABSA Bank Limited to use SDT's software, Exergy, as its life policy administration system is confirmation of the credibility that the platform has gained in large financial institutions.

In line with our acquisition strategy we have expanded our offering to include loan administration solutions by acquiring Acczone.