The financial year 2006 was our first full year as a VoIP operator in broadband telephony. VoIP is now a recognised technology in the telephony market. It has been adopted as mainstream and validated by major players in the industry, by the public at large, and by the regulators. VoIP is here to stay and Engin is at the forefront of this exciting field.

At Engin we have positioned ourselves with global players and have adopted new standards and technologies necessary to maintain our lead in this market. During the financial year, we forged a wholesale alliance with M2, offering services to small to medium sized businesses. We have linked up with Intel and Optima, allowing easy integration of VoIP technology into PCs. Our CEO will talk in more detail on this initiative.

At Engin, we are engaged in setting industry standards and indeveloping policy for the sector. We continue to support a light-handed approach to Government regulation and competitive access to any fibre-to-the-node network.

Looking at the operational performance of the company, Engin was able to meet and exceed expectations of customer numbers and serviceability of the network. By 30 June 2006 we had 39,000 paying subscriber lines, growing from 5,800 the year before. This growth looks like continuing. Research suggests that globally VoIP will continue to rise and that in Australia the rapid take-up of broadband will underscore a rise in internet telephony. Our service offers a complete, ‘normal’ telecommunications experience. We are not a ‘peer to peer’ computer operator. We offer an array of features such as voicemail, caller I.D. and most importantly our service supports “000” calls.

The rapid growth in subscriber numbers has meant a continued investment in marketing, our network , employees and other up-front costs as we have scaled up to meet the demands of this growing subscriber base. As I mentioned at last year’s AGM, further funding was necessary during the year to allow us to significantly increase our subscriber base. This has been achieved.

We now have the infrastructure and capacity to service a broad and expanding customer base. We also have a twelve year proven track record in the telecommunications industry from our experienced management team. New skills were acquired during the year, as we have attracted staff from major players in the telecommunications industry. We have increased our staff numbers overall. You could say 2005/06 has seen us mature from a pioneer of internet telephony into a more structured organisation with the numbers and expertise in personnel to meet and respond to future challenges in the industry.
And that future is very exciting indeed. Engin is now established in broadband telephony with a 40% market share. It is building up the critical mass to hold its own if a major competitor moves into the field. It has positioned itself to be ahead of the game, and to be an early mover in any future trends. VoIP mobility may be just one of the possibilities. Subject to shareholder approval, we have an exciting new platform from which to develop in the future with Seven Network Limited. I will expand on this further at the AGM.

I would like to thank you, our shareholders, for your continued support and confidence in the strategy of Engin.

On behalf of our board I would also like to thank our CEO, Ilkka Tales, his management team and all staff for their efforts, commitment and enthusiasm over the last year. It is only due to their unfailing efforts that we have been able to drive and capture such a significant growth in customer numbers and ensure VoIP is here to stay.