June 2016 - Quarterly Report

Highlights

• Completed a placement of $11.975M in after 30 June 2016

• Launched a video of the Roam-e drone in June 2016

• Establishing manufacturing capability for the Roam-e with AEE

• Developed a range of OK Smart Watches

• Established distribution arrangements for its products

About IOT Group Limited (Internet of Things)

IOT Group has tapped in to g l obal n i che

markets by adapting and enhancing existing t rend products and making them more

consumer useful. The IOT Group i s designing and developing a range of smart wearables, a range of f l y ing selfie drones, augmented

reality, v i r tual reality, home auto mation products and much more .

Utilising industry specific innovation and our own tech nology, we' ve created th e f i r s t facial recognition f l y i ng selfie device operated

through smartphones and v i s i on contro l systems, called ROAM - e. Built with the world ' s f i r st d ual - axis collapsible blades

means that ROAM - e' s l igh t , comp act an d easy to carry and ready for any occasion but most importantly not weigh you down. Selfies have reached new heights!

Outdoor Konnect ( OK) focus on designing and developing a range of affordable i nnovative wearable devices, accessories and outdoor

products using the l atest tec hnology with

unique features. Our devices i nclude a variety of smart watches with some a l ready available through retailers and f rom our website.

OTT Premium will provide l eading telcos,

broadcasters, TV & f i lm production companies and content owners with unsurpassed OTT

software delivering content that can be

v i ewed on multiple devices and languages

w o r l d w i d e d i r e c t t o t h e a u d i e n c e .

IOT Group Limited

ABN 66 140 475 921

Level 14

39 Martin Place

SYDNEY NSW 2000

Phone: 1300 205 955

Email: [email protected]

www.theiotgroup.com

Scott Brown Non-executive Chairman Ian Duffell Executive Director Simon Kantor Executive Director

Ron Hollands Company Secretary

Business Update

IOT Group Limited (ASX:IOT) is pleased to provide an update to shareholders for the quarter ended 30 June 2016. During the quarter, the Company continued to progress its business as follows:

• Developed a range of OK Smart Watches (see below) which will be sold through online and retailers

• The technical team have been working solidly on delivering the Roam-e drone and the full suite of functionality.

• Signed exclusive manufacturing agreement with AEE China. AEE production capabilities of up to 50,000 units per week by September 2016.

• Filmed and released the Hero video for ROAM-e in June 2016.

• Marketing team continued to finalise Product packaging and point of sales materials in different languages and are preparing them for mass global distribution.

• IOT during the quarter continues to develop the distribution channels and relationships in the United States, Canada, Mexico, Japan, Australia and the United Kingdom. Top Tech Distribution became the Company's US distributor.

• The Company presented ROAM-e to a sample market of four major US retailers with very positive feedback. The Company expects significant orders from US retailers and will believe that first sales of the Roam-e will be booked in the Dec Qtr.

• IOT Group has signed an exclusive Distribution Agreement with Shenzhen AEE Aviation Technology Co. Ltd (AEE) one of the World's largest Drone manufacturers, based in China to distribute AEE's range of drones in Australia and Japan.

• OTT Premium will provide leading telcos, broadcasters, TV & film production companies and content owners with unsurpassed OTT software delivering content that can be viewed on multiple devices

and languages worldwide direct to the audience. OTT Premium looks to partner with the biggest players in streaming, content provision, cloud storage, analytics, billing gateways and application development to provide a complete end-to-end content delivery solution .This end-to-end service provision reflects a B2B strategy for OTT Premium.

Corporate

On 30 June 2016 IOT Group had $1.9 million in cash. During the June Quarter, the Company continued to develop its business with net expenditure on operations being $2.7M. After the end of the quarter the Company raised $11.975M in funds (before costs) by issuing 171,074,680 ordinary class shares.

Issued and quoted securities at end of current quarter

For further information, please contact:

Ian Duffell - Executive Director of IOT Group on 0488 024 000 Websitewww.theiotgroup.com

Appendix 4C Quarterly report for entities

admitted on the basis of commitments

Appendix 4C

Quarterly report for entities admitted

on the basis of commitments

Introduced 31/03/00, Amended 30/09/01, 24/10/05, 17/12/10

Rule 4.7B

Consolidated statement of cash flows

IOT Group Limited Appendix 4C Page 4