SUBX.L Regulatory News (SUBX)

May 26, 2017

To

The London Stock Exchange

10 Paternoster Square

London

EC4M 7LS

Dear Sirs,

Sub: Outcome of the Board Meeting held on May 25, 2017

Please be informed that the agenda items stated hereunder were discussed and approved at the Board Meeting held on May 25, 2017 at Bangalore:

Ø Approval of the audited standalone and consolidated Financial Results of the Company for the quarter and year ended March 31, 2017.

Ø Approval of the audited standalone and consolidated Financial Statements of the Company for the year ended March 31, 2017.

Ø Appointment of Mr. Anil Singhvi as Chairman of the Company with effect from 25th May, 2017.

Ø Appointment of Mr. Vinod Kumar Padmanabhan and Mr. Ashwin Chalapathy as Whole-Time Directors (WTD) of the Company with effect from 25th May, 2017.

Please find enclosed:

Ø The consolidated Financial Results of the Company for the year ended March 31, 2017.

We request you to take the aforesaid notification on record.

Yours faithfully

For and on behalf of Subex Limited

Ganesh K V

Chief Financial Officer, Global Head -Legal and Company Secretary

SUBEX LIMITED

Registered office: RMZ Ecoworld, Outer Ring Road, Devarabisanahalli, Bangalore - 560 037

Statement of Audited Consolidated Financial Results for the quarter and year ended March 31, 2017

16 Earnings/(loss) per share (of ` 10/- each) (not annualised in case of the interim periods):

SUBEX LIMITED

Registered office: RMZ Ecoworld, Outer Ring Road, Devarabisanahalli, Bangalore - 560 037

Statement of Consolidated Assets and Liabilities

Notes:

1 The above results have been reviewed by the Audit Committee and approved by the Board of Directors in their meeting held on May 25, 2017.

2 The financial results of Subex Limited (Standalone information):

3 The financial results have been prepared in accordance with the recognition and measurement principles laid down in the applicable Indian Accounting Standards ("Ind AS") prescribed under section 133 of the Companies Act, 2013, read with relevant rules thereunder and in terms of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and SEBI Circular No. CIR/CFD/FAC/62/2016 dated July 5, 2016.

4 Reconciliation between previous GAAP and Ind AS

Consequent to transition from the previous GAAP to Ind AS, the reconciliation of profit/loss after tax for the corresponding three months and year ended March 31, 2016 and reconciliation of equity as on March 31, 2016 is provided below:

5[i][a] As at March 31, 2017, the Company assessed the carrying value of goodwill relating to its investment in the subsidiary viz. Subex Americas Inc., amounting to ` 9,736 Lakhs (March 31, 2016: ` 18,606 Lakhs). Based on future operational plan, projected cash flows and valuation carried out by an external valuer, the Company has made an impairment provision of ` 6,010 Lakhs (March 31, 2016: ` 8,870 Lakhs) towards the carrying value of goodwill relating to its investment in the said subsidiary. The management is of the view that, the carrying value of goodwill relating to its investment in the said subsidiary of ` 3,726 Lakhs as at March 31, 2017 is appropriate.

5[i][b] As at March 31, 2017, the Company assessed the carrying value of goodwill relating to its investment in the subsidiary viz. Subex (UK) Limited amounting to ` 67,036 Lakhs (March 31, 2016: ` 67,036 Lakhs). Based on future operational plan, projected cash flows and valuation carried out by an external valuer, the Company has made an impairment provision of ` 4,880 Lakhs (March 31, 2016: ` Nil) towards the carrying value of goodwill relating to its investment in the said subsidiary. The management is of the view that, the carrying value of goodwill relating to its investment in the said subsidiary of ` 62,156 Lakhs as at March 31, 2017 is appropriate.

5[ii] During the year ended March 31, 2016, pursuant to the QVT Interest Waiver Letter dated March 26, 2016, the lenders of term loan of US$ 12 Million to Subex Americas Inc. had waived the interest liability upto the date of such letter and interest accruing thereafter upto August 22, 2016. Further, interest rate has been revised from 10.5% per annum to 5% per annum, effective August 22, 2016. Consequently, accrued outstanding interest of US$ 2.9 Million ( ` 1,970 Lakhs) has been written back and impact on measurement of such long term borrowings at fair value resulted in reduction in carrying value by ` 431 Lakhs as at March 31, 2016. During the current year ended March 31, 2017, such interest waiver has been extended till June 30, 2017 and subsequent to the year end, the entire loan of US$ 12 Million has been repaid as on May 15, 2017.

6 Subsequent to balance sheet date, the Company has made an allotment of 55,094,999 equity shares of the Company on a preferential basis, at an issue price of ` 14 per equity share (Face value of ` 10 per equity share) amounting to ` 7,713 Lakhs.

7 (a) As at March 31, 2017, the Company has outstanding FCCBs III of USD 3.60 Million ( ` 2,335 Lakhs) which are carried at fair value of USD 3.51 Million ( ` 2,277 Lakhs) in the books of accounts, which are due for redemption on July 07, 2017.

(b) The FCCB holders in their respective meetings have approved the deferral of aggregate interest of US$ 0.73 Million ( ` 473 Lakhs) in respect of outstanding FCCBs III with face value of US$ 3.60 Million ( ` 2,335 Lakhs) for the period July 6, 2012 to January 5, 2016 till redemption date of the bonds, being July 07, 2017.

8 The Company had remitted the withholding taxes on interest on FCCBs III in accordance with the provisions of the Income Tax Act, 1961 amounting to ` 1,052 Lakhs pertaining to FCCBs III which have been converted into equity shares of the Company. Pursuant to such conversion, the interest accrued but not due is considered no longer payable and the management basis expert advice, is of the view that the withholding taxes paid by the Company in respect of the aforesaid interest, are recoverable from income tax department and/or are adjustable against its other withholding taxes obligations. Accordingly, the Company has revised the returns of withholding taxes and adjusted withholding taxes of ` 205 Lakhs during the quarter ended March 31, 2017 (quarter ended December 31, 2016 and March 31, 2016 amounting to ` 377 Lakhs and ` Nil, respectively and that for the year ended March 31, 2017 and March 31, 2016 amounting to ` 1,037 Lakhs and ` Nil, respectively) on salary, professional services and others by write back of withholding taxes on interest on FCCBs paid earlier, and such write back is included under other income.

9 Employee benefits expenses for the quarters ended March 31, 2017, December 31, 2016 and March 31, 2016 are net of reversal of provision no longer required, in respect of employee incentives relating to sales and delivery commissions, amounting to ` 700 Lakhs, ` Nil and ` 192 Lakhs, respectively and that for the year ended March 31, 2017 and March 31, 2016 amounting to ` 700 Lakhs and ` 1,065 Lakhs, respectively.

10 The Group is engaged in the business of software products and related services. These, in the context of Ind AS 108 on Operating Segments Reporting are considered to constitute one segment and hence the Group has not made any additional segment disclosures.

11 The figures of last quarter of current and previous year are the balancing figures between the audited figures in respect of the full financial year and the published unaudited year to date figures of nine months of respective year.

12 Previous period figures have been regrouped/ reclassified, wherever necessary to confirm to current period's/ year's classification.

13 Pursuant to Regulation 33 of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Company has opted to publish the consolidated financial results. The standalone financial results, however, are being made available to the Stock Exchanges where the securities of the Company are listed and are also being posted on the Company's website www.subex.com.