DataDot Technology Limited

Stock Exchange Announcement

May 26, 2005

SECOND-HALF TRADING

The directors of DataDot Technology Ltd (ASX: DDT) announce that they have finalised a review of their expectations for the result before interest and tax (EBIT) for the financial year ending 30 June 2005. This review has been undertaken in light of the statement in the IPO Prospectus dated 22 November 2004 that:

the directors have elected not to include forecasts in this Prospectus due to the difficulty in estimating the timing and quantum of customer orders. Based on current trading conditions, and assuming no unforeseen delays of difficulties, the Directors believe that DDT is likely to achieve growth in sales and at least breakeven profitability in the 2005 financial year (notwithstanding a first half loss of approximately \$1.2 million unadjusted).

The directors announce that trading to date in the second-half has been at a level consistent with trading in the first-half. A number of significant sales contract negotiations that had been expected to be finalised in the second-half (resulting in the increase in sales growth referred to in the Prospectus) have taken longer than anticipated and are now unlikely to contribute revenue in financial 2005. The directors remain confident that these sales opportunities will be realised in the short to medium term. As a result of this, the directors now anticipate that the Company will incur an EBIT loss for the year ended 30 June 2005 of \$2.5 million.

During this period the company has maintained its financial support of emerging regional markets beyond Australia. In maintaining this strategy directors have clearly signalled their confidence in the opportunities for revenue growth from growing geographic markets in Russia, New Zealand, Europe, USA, India, Central and South America.

The directors remain confident of the Company's revenue growth potential for the following reasons:

Recurring revenue, from existing customers in the automotive, marine and other market segments, continues to be generated at levels consistent with those achieved in the first half.

• Negotiations continue with a number of potential new customers in the automotive and other market segments, which the directors anticipate will result in contracted sales of the company's products in due course.
• New generation identifiers have been developed to increase the market potential of the company's products. A separate market announcement of today's date carries details of this new product. DataTraceDNA.

About DataDot Technology Limited (DDT)

DDT is a leading asset identification company, with expanding global operations. DDT has invented, patented and commercialised an asset identification technology which provides greater asset security, proves authenticity of product, assists in proving ownership, and acts as a deterrent to thieves.

The DataDotDNA technology has gained acceptance around the world and is currently sold in Australia, UK/Europe, USA, Canada, South Africa, Indonesia, Taiwan, Thailand, Hong Kong, China, New Zealand, Russia and Poland. DataDotpna customers include a number of major vehicle suppliers in various regions including Nissan, BMW, Subaru, Ford Performance Vehicles, Porsche, Holden Special Vehicles, Isuzu, Avis, Techmashimport, Mitsubishi and VW.

For further information please contact:

Mr Ian Allen Chief Executive Officer DataDot Technology Limited Phone: 612 9975 4777 612 9975 4700 Fax: Web: www.datadotdna.com