Chairman’s Annual Report 2016

Nationally, the taxi industry continues to experience unprecedented competition from ride-share services. This coupled with an ever increasing number of taxi customers using the industry’s “white label” smart phone applications has this year resulted in an 11% decrease in calls to our national 131008 number.

Taxi 131008 Limited’s attempt to offset this decline in telephone bookings through the establishment of its own smartphone taxi booking application has encountered some significant obstacles. The IT Company which developed our Australia Wide Taxi Booking Application (AWAP) closed its doors in January 2016 and the board has had limited success in engaging an alternative provider to further develop and support the AWAP in a cost effective manner. The board’s deliberations on future promotion of the AWAP are further constrained by an already poor take-up both in the number of member companies willing to use the AWAP, lack of customer downloads and consequently the minimal number of bookings being made through the AWAP. While continuing to support the AWAP in line with current member contracts the board believes that it would be in shareholders best interests to ultimately dispose of this asset. In the absence of significant promotional expenditure, the board sees little prospect of AWAP returns reaching a break-even point and as reflected in the Financial Report the asset has been significantly impaired.

As was reported last year, Telstra’s contract with Taxi 131008 Ltd contains charges that were not included in previous contracts and while the company has absorbed call charges until 31st December 2015 and IVR call charges until 30th June 2016, those charges are now being passed on to members. The total cost to the company to absorb charges until the dates mentioned was $564,212.00 In forthcoming months the board will seize on the opportunity to negotiate a new telecommunications contract as the current Telstra contract expires in March 2018.

Telstra IVR call charges in several areas threaten to unfairly financially disadvantage some of our licensees. The board has been active in looking at alternatives to assist those affected by such IVR call charges and as technical

alternatives appear to be limited, some IVR platforms have had to be removed or hosted with alternative providers

The board’s aim of achieving “a substantial reduction in administration costs” which was reported last year has been realised. This has been achieved by way of a smaller board of 3 members with most board meetings being conducted via teleconferences. Furthermore Board members have actively undertaken most administrative duties themselves while others have been outsourced. The net effect of this is that budget outcomes have been met and all critical administrative functions carried out in an efficient manner. The board continues to evaluate the sustainability of the reliance on active board members and will engage additional resources when necessary. The board is predicting a positive budget outcome for 2016/2017 following a full year of passing on call costs and IVR charges to licensees and an allocation for additional administrative resources.

With in excess of 23 million calls per annum, the 131008 national taxi booking number continues to be a valuable asset for our taxi service providers and despite significant competition the number remains the service of choice for hundreds of thousands of taxi users across the country.

Finally, on behalf of the Directors, thank you for your support