ANTEOTECH LTD - Interim / Quarterly Report 2016

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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

INTERIM FINANCIAL REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

INTERIM FINANCIAL REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

*Contents*	*Page* *Contents*	*Page*

Corporate Directory	1 Statement of Cash Flows	15
Directors’ Report	2 Notes to the Financial Statements	16
Statement of Profit or Loss and Other Comprehensive Income	12 Directors’Declaration	19
Statement of Financial Position	13 Auditor’s Independence Declaration	20
Statement of Changes in Equity	14 Independent Review Report	21

CORPORATE DIRECTORY
Directors	Mr Mark Bouris Non-Executive Chairman
	Dr Geoffrey Cumming CEO, Executive Director
	Mr Richard Martin CFO, Executive Director
	Mrs Sandra Andersen Non-Executive Director
	Dr John Hurrell Non-Executive Director
	Mr Rolf Sickman Non-Executive Director
Company Secretary	Mr Shane Hartwig
Registered office	4/26 Brandl Street, Eight Mile Plains QLD 4113
Mailing address	4/26 Brandl Street, Eight Mile Plains QLD 4113
E-mail:	[email protected]
Website:	www.anteodx.com
Legal advisors	ClarkeKann Lawyers
	300 Queen Street, Brisbane QLD 4000
Auditors	Grant Thornton
	145 Ann Street, Brisbane QLD 4000
Patent attorneys	Freehills Patent Attorneys
	101 Collins Street, Melbourne VIC 3000
	Fisher Adams & Kelly
	Level 6, 175 Eagle Street, Brisbane QLD 4000
Share registry	Boardroom Pty Limited
	Level 7, 207 Kent Street, Sydney NSW 2000
Insurance advisors	Yellow Brick Road Wealth Management Pty Limited
	1 Chifley Square, SYDNEY, 2001
Bankers	Australia and New Zealand Banking Group Limited
	3 Sherwood Road, Toowong QLD 4066

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

Dear Shareholders,

In the past 6 months your Company has completed a transformational acquisition. The acquisition of DIAsource Immunoassays SA is pivotal in the commercialisation of our unique and patented Mix&Go technology in the diagnostics sector. Its strength in product distribution and quality certified manufacturing significantly adds to the capacity of Anteo to gain commercial applications of its technology in this large market sector.

As a result of the acquisition and integration of the activities of DIAsource into the Anteo group, a strategic review of our operations and commercialisation activities has been undertaken to optimise and focus our strategy for the market applications of Anteo’s technologies.

Anteo’s technology applications are potentially limitless, and it lends itself to the development of a platform from which a large number of applications for the technology can be pursued. Our library of formulations and patent suite are the core of this technology platform on which the strategic commercialisation of applications is founded.

A review of commercial applications has been undertaken and a broad range of potential commercial applications has been focused to an initial three sectors. We continue to pursue our activities in diagnostics, and refine our commercialisation initiatives. We have completed our work in the Intellectual Property development for the industrial application in the energy sector, concentrating initially on storage devices. This work has progressed to the next stage of garnering industry engagement for the formation of partnerships for further research and development. We will also continue the excellent work we have commenced with Cook Medical in improvement of the performance of medical devices, and our activities in this sector will be expanded to seek further opportunities in medical and in vivo applications.

Your continued support is invaluable to the success of your Company, and we thank you for your encouragement and support through our recent capital raising to secure the funding for the acquisition of DIAsource.

It remains an exciting period for Anteo, and in the ensuing six months we are looking forward to further opportunities in each of our core sectors and the delivery of new commercialisation partnerships.

Yours faithfully,

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Mark Bouris

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

The Directors of Anteo Diagnostics Limited submit herewith the interim financial report for the halfyear ended 31 December 2015. In order to comply with the provisions of the Corporations Act 2001, the Directors report as follows:

The names of the Directors of the Company during or since the end of the half-year are:

Mr Mark Bouris Dr Geoffrey Cumming Mr Richard Martin Mrs Sandra Andersen Dr John Hurrell Mr Rolf Sickman (appointed 29[th] January, 2016)

REVIEW OF OPERATIONS

DIASOURCE ACQUISITION

The Company has been active on a number of fronts over the past 6 months. On 11 January 2016, Anteo Diagnostics Limited purchased all of the shares in DIAsource Immunoassays SA. At completion of the transaction, €7.7m of the Purchase Price was paid in cash, and €7.7m is payable on a deferred basis, over 4 years, and bearing interest on the outstanding amounts at 8%pa. The details of the arrangements are contained in the Notes to the Financial Statements. The DIAsource vendors are entitled to earn out payments, should threshold performance targets be achieved. The total value of the potential earn out payments is €7.3m which would, if earned, be payable in April 2017. In this instance the value of DIAsource Immunoassays SA may be significantly enhanced improving the ability of the Group to finance the earn out payment.

The acquisition was funded through the proceeds of an entitlements issue and placement raising over $13.2m. The Entitlement Offer raised $5.3m through the issue of 70,092,623 Shares. Anteo resolved to place 89,907,377 of the shortfall of the Entitlement Offer to raise $6.7m (“Shortfall Placement”), and undertake a placement of 16,525,623 fully paid ordinary shares on the same terms as the Entitlement Offer at an issue price of $0.075 to raise a further $1.2m (“Placement”).

ANTEO GROUP STRATEGY

Following completion of the acquisition of DIAsource, the Company has revised its strategies to incorporate the strengths and experience of DIAsource, and to apply the benefits of the Mix&Go technologies to DIAsource products. In conjunction, as the Company has advanced its activities in the energy and medical applications sectors, the group’s overarching goal of delivering a technology platform capable of commercialisation across a broad range of market sectors is being realised.

With over 40 formulations, Anteo’s technology platform continues to grow in terms of potential applications and opportunities. For now, Anteo will maintain its focus on 3 core sectors, however, it is expected the strategies implemented over the ensuing months will identify potential new commercialisation opportunities.

Nonetheless, the potential applications for the technology platform on which Mix&Go is founded are manifold, and encompass a broad range of applications. Wherever a bond is required, the uniquely strong and stable chelation coupling that Mix&Go delivers, presents a potential application. Newly identified areas of interest include environmental clean up and recovery applications, delivery of nutraceuticals and vitamins for the global mega trend of the Forever Young[1] , industrial coatings, and food packaging and testing.

1 Our Future World Global Megatrends Report, 2015 Stefan Hajkowicz, CSIRO Publishing

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

The graphic below presents the potential areas of interest together with the Core Sectors in which Anteo is currently active. As a component of our strategy in life sciences and research, which provides the gateway to future applications, Anteo will increase focus on the sale of coupling kits which demonstrate the efficacy of its platform technology. As researchers and developers of new products use the kits, and discover chelation as a viable and time efficient alternative to covalent and passive coupling, new applications will arise.

Anteo will then assess the commercial benefit and the scientific effort required to determine where to focus its future efforts. Over the next 12 months, Anteo will concentrate its efforts on gaining commercial outcomes from its current collaborations in Diagnostics, Energy and Medical Applications. As these applications begin to contribute to the group, time and resources will be directed towards the development of one additional sector for commercialisation per annum. Each sector will require a tailored business model for the commercialisation of the technology in that application and Anteo will make an assessment as to the most appropriate method, ranging from sale of limited application licenses, joint ventures, acquisitions for product distribution to the contract manufacture of products.

The graphic below demonstrates the current stage of development of the commercial process by shading the stage in the leaf applicable to the application. Leaves without pattern shading are areas for future development.

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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

CORE SECTOR: DIAGNOSTICS

For a number of years, Anteo focused its resources on the in-vitro diagnostics sector, in particular targeting the large automated IVD suppliers. The barriers to entry in this part of the sector are considerable, given tests are mature, and regulatory barriers discourage changes to existing manufacturing processes. Accordingly, the Company developed supplementary strategies in the immunoassays segment to generate additional opportunities in the segment and improve the likelihood of success. Those strategies target the fast growing emerging technologies of point of care and molecular technologies. Both areas are a natural fit for the Anteo technology due to the smaller size of the particles utilised in these assays. Additionally, both areas are very active in the development of assays; since it is during assay development that barriers to entry are at their lowest, targeting these companies represents an opportunity to apply the technology in a high performance area at the time when it will be most valued.

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High growth
markets with
lower barriers
to adoption
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This requires a targeted marketing of our capabilities broadly through the life sciences and research sector. To achieve penetration of this market, Anteo has developed exemplar kits utilising its Mix&Go technology. The kits which incorporate a set of components which will operate effectively with the Mix& Go technology can be used by researchers, and product and assay developers to test our product. Follow up with users of these “AMG” products generates opportunities for paid research and development collaborations for the development of new products, and ultimately incorporation into the final assay.

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POCT is already a significant market segment of the immunoassay market and backed by the demand from the medical profession and government cost efficiency, the market for global POCT is expected to grow at a CAGR of around 8.4% during 2013-2018 to reach a value of US$ 24 billion by 2018 .

Technological assistance through advanced microfluidics, digital optics, lab-on-a-chip experiments , and devices is expected to further enhance the quality of Point of Care Testing (POCT).

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

According to “Global Point-of-Care Diagnostics Market Outlook 2018”, the global POCT industry is at a very crucial stage with POCT expanding itself into diverse disease areas, such as cancer and HIV diagnostics.

Our new strategy for distribution of the kits is to utilise the strengths in distribution management that DIAsource holds, and to draw on their expertise as a marketing manager of distributed products. Our objective is to have the widest possible distribution of our products and gain the best of the available collaboration opportunities. DIAsource will take over the management of existing relationships, as well as the recruitment of new distributors focused in the life sciences sector, and implement marketing support strategies to gain the highest possible product awareness and sales. Anteo Technologies will retain the post sales follow up, and lead generation of research and development collaborations. As volumes of sales increase, manufacturing will be considered for transfer to DIAsource’s Quality Accredited manufacturing facility, further leveraging the acquisition through optimisation of manufacturing processes.

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New Products – AMG Universal Coupling Kit and AMG 40nm Gold Kit

Coupling ligands or large molecules to a solid phase such as particles is not easy to perform and is time consuming when using covalent chemistries such as EDC-NHS. In research and development, time becomes an important resource. Though the passive absorption to a solid phase is easy to perform, the poor reproducibility makes it a sub-optimal choice for researchers. Hence, there is a need to have an alternative coupling method such as Mix&Go, a chelation coupling technology, which combines the advantage of the easy coupling of passive method and the better strength and stability of covalent chemistry.

The AMG Universal Coupling Kit is developed for the research and life science consumer market. It will showcase the ability of our Mix&Go platform technology to activate carboxylic acid functionalised particles. The product has been designed to be applicable to particles ranging in size from 100nm to 3,000nm thereby delivering flexibility to customers in their choice of particle. The kits contain all reagents necessary, including buffers, to allow ligands of interest to be coupled to particles for versatile downstream applications. The ability to provide such a flexible kit for such a large range of particles is unprecedented in the immunoassay marketplace.

The kit product best demonstrates the benefits of utilising Mix&Go platform technology.

Gold particles are often the particle of choice in the development of lateral flow assays as they allow greater sensitivity to be achieved than is possible with, for instance, latex particles. Gold particles of 40nm are typically used and, due to the difficulty of covalently coupling proteins to colloidal gold, the

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

lesser stability offered by passive coupling is generally accepted. The AMG 40nm Gold Kit, developed in collaboration with IMRA, allows more stable binding to be combined with the benefits of gold particles.

These novel kits will build broad technical and brand awareness of Anteo’s Mix&Go suite of surface coupling solutions in order to identify and secure more opportunities in a plethora of health care sectors, including in vitro diagnostics. The two new products add to the existing 2 AMG and 3 Mix&Go products currently represented in distributor catalogues, including Sigma and Veritas.

A staged study is being undertaken at Future Diagnostics in the Netherlands to demonstrate the performance of the Universal Coupling Kit on a range of the most frequently used carboxyl particles. Selected particles will progress to a second stage that will clinically validate the activated particles for use in assay development.

Pre-marketing activities are currently underway with the major global bead suppliers in anticipation of the release of the AMG Universal Coupling Kit. Feedback has been positive and confirms our belief that the kit fills an unmet need in the market.

Meetings were held with many of our European collaborators in late February to plan next steps in the respective projects.

A volume sale of protein coupled bead-based product to a very large global Life Sciences company was successfully concluded in late 2015. The company has placed a second order, of similar magnitude in January which has been shipped. Meetings with this company are in progress to discuss their ongoing need for this product and explore their possible need for additional similar products.
PoC1 meetings were held to discuss the outcomes of the work undertaken in 2015. Although the Mix&Go technology delivered the results required, POC1 has determined it will proceed with the launch of its device in its current form. Future collaborations will be considered as POC1 moves forward with new generations of the sensor surface.
Meetings with Scienion reviewed the outcomes of current activities and resulted in agreement on additional commercially valuable areas for ongoing joint activities that should be pursued.

DIAsource

Highlights

DIAsource Immunoassays SA was acquired on 11 January 2016, and accordingly the results for the last half year are not included in the financial statements. However, we have provided commentary on the business activities of DIAsource to add context to the acquisition and its effect on future commercial outcomes.

In 2015, DIAsource has proven the success of its new strategy and change program launched early 2014. The commercial strategy paid off both quantitatively, with a 19% growth in topline; and qualitatively through a noticeable increase in recognition by and improved position in the market. The increase in output from Operations shows that the new organization is able to handle the major increase in business through the supply chain. The increase in overall efficiency is the fruit of the hard work invested in continuous improvement of people, capabilities and processes. DIAsource experienced a strong increase in trade sales in the first half of calendar 2015 which continued in the second half, but moderated after the two consecutive ‘best month ever’ as well ‘best quarter ever’ delivered in the first half year.

Sales results in second half of calendar 2015 increased 14% over the prior comparative period and were slightly below the first half year (by 2%). Most segments including antibodies, instrumentation, and specific distributorships continued to grow during the period led by the ELISA product sales

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

spearheaded by Vitamin D, and RIA product sales. Contract manufacturing of ELISA kits and Abs for ThermoFisher declined during the period.

Second half 2015 highlights were:

first Vitamin D sales in China after obtaining China FDA approval earlier in the year,
continued growth in RIA by providing full service to existing and new customers worldwide (some previously serviced by Siemens), including the placement of RIA instrumentation, and
good growth in Southern Europe and Latin America through the newly hired sales representatives and the newly established Spanish subsidiary.

Operations

The second half of calendar 2015 brought the launch of the new unique 25-hydroxy Vitamin D ELISA Fast (90 min) assay, following the earlier launch of the updated 1,25 (OH)2 ELISA Vitamin D in H115. Vitamin D business growth was supported with an increased presence and representation in congresses and events, both scientific and commercial.

DIAsource received re-certification for ISO 13485 and 9001 (including the license for Canada) after successful audit by Lloyds LRNE, and consistently performed with excellent results on various external supplier audits. The company also implemented REACH, the new EU legislation for Classification, Labelling and Packaging (CLP).

All operational teams confirmed increased production levels compared to the prior half year, consistently logging 15% to 30% increased output across all major Key Performance Indicators, from batches in chemistry, output of the ELISA and RIA coating and kit assembly units, number of shipments, and client and purchase orders.

The supply chain produced some 50,000 kits in H2-2015, for a total above 100,000 kits in-house DIAsource kits in 2015 (not including ThermoFisher contract manufacturing).

Headcount increased to 76 people and 73 full time equivalent (FTE) at the end of 2015 (versus headcount of 73 at end Q2) to support the growth in commercial activities. The new hires were mostly in the commercial team which has been strengthened considerably in 2015. The strengthening of the commercial team that has been completed in 2015 is the foundational work for the future growth of the company. Both project management and continuous improvement capabilities received further strong focus with additional training, and continued work on the company’s major efficiency and gross margin improvement initiatives. Revenue per FTE increased 5% from €187k/FTE in 2014 to €197k/FTE in 2015.

Financial results

The fiscal year 2015 was concluded with 19% growth in revenue and 23% growth in EBITDA vs 2014, the latter aided by an increase in gross margin. Total 2015 revenues were of €14.2m vs €11.9m in 2014. These figures are indicative and, as yet, unaudited. Net available income doubled versus last year. The cash and debt situation improved greatly due to the conclusion of several lease financing facilities in the period under review.

CORE SECTOR: ENERGY

Anteo’s research and development team has made a breakthrough in the area of energy storage. Silicon based anodes have energy densities that are ten times higher than existing graphite anode materials and thus have potential to significantly reduce the size and weight of the anode with flow-on effects in energy storage cell volume and weight. However poor stability (short lifetime) has been a major roadblock to broad adoption of silicon use. The problem is that silicon materials expand and contract by 300% during charge and discharge, causing the anode to break apart. Anteo NanoCoat

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

provides a protective net that allows the silicon anode to expand and contract without breaking down during charge and discharge.

The advantages of Anteo’s Silicon (Si) anode technology:

Drop-in approach and replaces current graphite anode without requiring significant new capital and equipment

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Uses commercially available raw materials (Si particles, carbon conductors and polymer binders); no specially nano-engineered Si materials with associated high costs
Low-cost, highly scalable and environmentally friendly processing; no high-cost processes with harsh conditions involved
Combined benefits of higher battery capacity, longer battery life, faster charge and safer batteries
A versatile coating technology which works with both particle materials and bulk/film electrodes for high performance batteries

Anteo Energy is now working on the next stage of the commercialisation of this technological breakthrough with the development and implementation of partnership arrangements to commercialise the technology. The commercial opportunity is assessed as being very strong with a fast growing target market expected to treble in the ensuing 10 years.

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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

CORE SECTOR: MEDICAL DEVICES

Anteo has identified a number of promising opportunities to improve outcomes in the Medical Devices market. The complexity of the design and manufacturing of devices is a perfect application for the Mix&Go platform technology. Mix&Go can be used to improve the durability and consistency of devices, reducing or eliminating health risks to the patients during and after surgical procedures.

A number of activities in this sector are being pursued:

Re-formulation of our nanoglues using materials that are Generally Regarded as Safe (GRAS). Using starting materials that are known to be safe for human use simplifies the regulatory hurdles of developing new products in this field. Work in this area has demonstrated our ability to produce a product that binds strongly to synthetic substrates, such as those that are commonly used in medical devices. Initial studies have shown no toxicity using such nanoglues and further studies are being progressed.
Improving the character and behaviour of coatings to deliver more robust and reliable devices. The FDA has issued a safety communication that warns of the possible peeling or flaking of coatings that are often used in medical devices and the serious injuries that could result. Studies undertaken in-house have demonstrated the utility of Anteo technology in addressing this recognised problem.
Development of IP strategy and patents relevant to this field. Existing Anteo patents can be considered Background IP but two patenting opportunities specific to this field were identified. Each provisional patent application applies to formation of stable functionally active materials commonly used in the application of medical devices. Anteo is now working on progressing these provisional applications to full granted patents as well as commercialisation strategies such as partnership arrangements.

Anteo was engaged in paid collaborative work with Cook Medical through 2015 that had the objective of developing some outcomes considered desirable by Cook. The initial study was successful to the extent that several additional product concepts explored have been tested. The outcome of the original study was sufficiently promising in our laboratory to share the material with Cook.

The preliminary results from Cook Medical show that, in their hands, Mix&Go appeared to meet their primary demands. Further testing is being undertaken in their laboratories to confirm this observation. This paves the way to a range of opportunities with suppliers of components to the medical device market and medical device companies.

RESULT FOR THE PERIOD

On the 26[th] August 2015, the Company announced that it had entered into an agreement to acquire DIAsource Immunoassays SA in Belgium for the amount of €15.4m purchase price plus an earn out of up to €7.2m, with a maximum of €5.8m payable in cash. The Company reached agreement with the vendors of DIAsource prior to the end of the year to provide €7.7m finance for the acquisition repayable over 4 years in equal biannual principal instalments. The acquisition was completed on 11[th] January, 2016 and at that time €7.7 was remitted to the vendors in accordance with the agreement. During the period to 31[st] December, 2015 the Company undertook an Entitlement Offer that closed on 23[rd] December, 2015 and issued 70,092,623 ordinary shares at $0.075 each and raised $5.3m. Subsequent to the 31[st] December, 2015 a further $8.0m was committed in placement. The Company incurred costs relating to Investment Activities of $0.9m and Finance costs of $1.1m relating to the proposed Convertible Note Funder during the period.

The net loss after tax for the half-year ending 31 December 2015 was $3.1m compared with a loss of $2.7m in the same period last year. The net loss before Investment Activities and Finance Costs was $1.1m. During the period a Research and Development Taxation Incentive Rebate of $1.5m was earned (2014: $1.1m) and Other Revenue from Operating Activities $0.6m (2014: $0.2m).

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

As at 31 December 2015, the Company held cash and deposits of $6.9m (30 June 2015: $5.2m).

DIVIDENDS

The Directors have not declared a dividend to be paid during the period.

AUDITOR’S INDEPENDENCE DECLARATION

A copy of the Auditor’s Independence Declaration (as required under Section 307C of the Corporations Act 2001) is shown on page 20 and forms part of this report.

Signed in accordance with a resolution of the Directors made pursuant to Section 306(3) of the Corporations Act 2001.

On behalf of the Directors

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............................................. . Mark Bouris Chairman Sydney, Dated 29[th] February 2016

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE HALF YEAR ENDED 31 DECEMBER 2015

Note Other revenue from ordinary activities 2 Selling, distribution and business development expenses Occupancy expenses Administration expenses Borrowing costs Research and development expenses Other expenses from ordinary activities 2 Loss from ordinary activities before income tax Income tax benefit relating to ordinary activities Loss from ordinary activities after income tax Loss attributable to members of the parent entity Other Comprehensive Income Total Comprehensive Income (Loss)	31 December 2015 $ 2,144,411 (1,002,379) (72,328) (310,029) - (1,780,309) (2,060,175) (3,080,809) - (3,080,809) (3,080,809) - (3,080,809)	31 December 2014 $ 1,850,631 (721,450) (74,975) (324,794) - (1,538,012) (1,455,557)
		(2,264,157) -
		(2,264,157)
		(2,264,157)
		-
		(2,264,157)

Basic earnings per share (cents per share) Diluted earnings per share (cents per share)	(0.4) (0.4)	(0.3) (0.3)

The financial statements should be read in conjunction with the accompanying notes.

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2015

CURRENT ASSETS Cash assets Current Deposit Receivables Other TOTAL CURRENT ASSETS NON-CURRENT ASSETS Property, plant and equipment TOTAL NON-CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Payables Provisions TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Provisions TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Contributed equity Share option reserve Accumulated losses TOTAL EQUITY	31 December 2015 $ 3,601,873 3,336,921 1,924,117 70,904 8,933,815 605,667 605,667 9,539,482 792,530 280,143 1,072,673 95,212 95,212 1,167,885 8,371,597 46,681,965 766,066 (39,076,434) 8,371,597	30 June 2015 $ 5,206,567 - 242,905 53,673
		5,503,145
		540,123
		540,123
		6,043,268
		345,942 255,562
		601,504
		94,901
		94,901
		696,405
		5,346,863
		40,610,141 967,627 (36,230,905)
		5,346,863

The financial statements should be read in conjunction with the accompanying notes.

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 31 DECEMBER 2015

Balance at 1 July 2014 Issued during the year Capital Raising Costs Options expensed for the period Options lapsed for the period Options converted to shares for the period Losses attributable to members of the parent entity Balance at 31 December 2014	Contributed Equity Ordinary Shares Options $ $ $ $ 38,657,954 455,739 (32,012,358) 7,101,335 918,750 - - 918,750 - - -- - 1,247,510 - 1,247,510 - (1,793) 1,793 - 33,441 (33,441) -- - - (2,264,157) (2,264,157) Accumulated Losses Total
	39,610,145 1,668,015 (34,274,722) 7,003,438

Balance at 1 July 2015 Issued during the year Capital Raising Costs Options expensed for the period Options lapsed for the period Options converted to shares for the period Losses attributable to members of the parent entity	40,610,141 967,627 (36,230,905) 5,346,863 6,434,649 - - 6,434,649 (362,825) - - (362,825) - 33,719 - 33,719 - (235,280) 235,280 - - - -- - - (3,080,809) (3,080,809)
Balance at 31 December 2015	46,681,965 766,066 (39,076,434) 8,371,597

The financial statements should be read in conjunction with the accompanying notes.

ANTEO DIAGNOSTCS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 31 DECEMBER 2015

CASH FLOWS FROM OPERATING ACTIVITIES: Receipts from customers Receipt from R&D Tax Incentive Grant receipts Payments to suppliers and employees Interest received Net cash (used in) operating activities CASH FLOWS FROM INVESTING ACTIVITIES:	31 December 2015 $ 592,095 - - (4,793,624) 22,488 (4,179,041)	31 December 2014 $ 341,172 1,087,247 449,113 (2,791,298) 91,673
		(822,093)

Payment for property, plant and equipment	(160,556)	(316,133)
Cash Placed on Current Deposit Net cash (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Captial raising costs	(3,336,921) (3,497,477) (362,825)	-
		(316,133)
		-
Proceeds from issues of shares, options, etc.	6,434,649	918,750
Net cash (used in) provided by financing activities Net increase (decrease) increase in cash held Opening cash brought forward	6,071,824 (1,604,694) 5,206,567
		918,750
		(219,476) 7,070,722
Closing cash carried forward	3,601,873	6,851,246

The financial statements should be read in conjunction with the accompanying notes.

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2015

1. Summary of accounting policies

Basis of Preparation

The half-year financial report is a general purpose financial report prepared in accordance with the Corporations Act 2001, AASB 134 Interim Financial Reporting, Australian Accounting Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 Interim Financial Reporting. The half-year financial report does not include disclosures or notes of the type normally included in an annual financial report and should be read in conjunction with the most recent annual financial report and any other public announcements made during the half-year in accordance with the continuous disclosure requirements arising under the Australian Stock Exchange Listing Rules and the Corporations Act 2001.

The accounting policies set out below have been applied in preparing the financial statements for the half-year ended 31 December 2015.

(a) Going Concern

This report adopts the going concern basis of accounting, which contemplates the realisation of assets and the discharge of liabilities and commitments in the ordinary course of business.

As at 31 December 2015, the Group had cash and deposits of $6,938,792, earned a loss for the half year of $3,080,809 and had net operating cash outflows for the period of $4,179,041. In addition, and as outlined in the Directors’ Report and Note 4 “Events subsequent to balance date”, Anteo Diagnostics Limited completed the acquisition of DIAsource Immunoassays SA on 11 January 2016, which was partially funded via a vendor funding agreement of €7.7m. This vendor funding is repayable over a four-year term, with payments due to the vendors in semi-annual principal instalments of €962,500 (plus interest) commencing in July 2016. The DIAsource vendors are entitled to earn out payments, should threshold performance targets be achieved. The total value of the potential earn out payments is €7.266m which would, if earned, be payable in April 2017. In this instance, the value of DIAsource Immunoassays SA may be significantly enhanced, improving the ability of the Group to finance the earn out payment.

Based on the above factors, the Group prepared a reforecast in February 2016 (including a cash flow forecast) through to 30 June 2017. The cash flow forecast indicates that the Group will have sufficient funds to pay its debts as and when they fall due for a period of at least 12 months from the date of this report. The Directors and Management of the Group are in the process of concluding documentation for a quasi-equity funding facility for the Group, to ensure that it will continue to have sufficient funds beyond this 12-month period.

The Directors have a reasonable expectation that they will be able to conclude arrangements to raise sufficient funds due to the advanced stage of current negotiations with investors and financiers. They believe therefore that the Group continues to be a going concern and that it will be able to pay its debts as and when they fall due.

On this basis the Directors believe that the going concern basis of presentation is appropriate. No adjustments have been made relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Group not have the ability to continue as a going concern.

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2015

If for any reason the Group is unable to continue as a going concern, it would impact on the Group’s ability to realise assets at their recognised values and to extinguish liabilities in the normal course of business at the amounts stated in the consolidated financial statements.

2. Loss from Ordinary Activities The loss from ordinary activities before income tax expense has been determined after: Depreciation of non-current assets: Plant and equipment Total depreciation of non-current assets Movements in provisions: Employee benefits increase / (decrease) Staff Remuneration Salaries Superannuation	31 December 2015 $ 95,062 95,062 24,892 1,166,696 110,044	31 December 2014 $ 74,747
		74,747

		46,522
		1,010,629 94,789
Share Based Payments	33,719	1,247,510
Other Revenue from ordinary activities Grants Revenue from operating activities R&D Tax Concession Rebate Interest – other corporations Other Expenses From ordinary Activities Options Expense Investment Activity Financing Costs	1,310,460 - 604,750 1,517,051 22,610 2,144,411 33,720 948,273 1,078,182 2,060,175	2,352,928
		449,113 230,867 1,087,247 83,404
		1,850,631
		1,247,510 208,047 -
		1,455,557

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2015

3. Operating Lease Commitments Payable:	31 December 2015 $	31 December 2014 $
- Not later than one year - Later than one year and not later than five years	328,856 293,184	299,984 587,288
Receivable:	622,040	887,272

- Not later than one year - Later than one year and not later than five years	- -	80,034 -
	-	80,034

4. Events Subsequent to Reporting Date

On 11[th] January, 2016 the acquisition of DIAsource Immunoassays SA was completed for a purchase price of €15,422,341. The acquisition was financed by the remittance of €7,722,341 and vendor finance of €7,700,000. The vendor finance is repayable over 4 years in equal semi-annual principal repayments of €962,500 plus interest at 8% per annum. The purchase is subject to a performance based earn out payment that has a maximum of €7,266,000.

The vendor finance agreement includes an option for the vendors to elect to receive the first year of interest in advance via settlement in shares. A premium in the interest rate applied if the election was exercised. At completion €484,592 interest was paid in advance to vendors of DIAsource at an interest rate of 12% per annum by the issue of 9,789,733 ordinary shares at an issue price of $0.075 each in accordance with an ordinary resolution of the Company.

On 11[th] January, 2016 70,954,330 shares were issued at an issue price of $0.075 each in a shortfall of the Entitlement Offer placement.

On 11[th] January, 2016 1,998,491 shares were issued at a deemed issue price of $0.075 each as part of the severance arrangements with the previously proposed convertible note lender.

On 25th January, 2016 9,229,909 shares were issued at an issue price of $0.075 each in a shortfall of the Entitlement Offer placement.

5. Equity Issued

During the six months 70,092,623 shares were issued at a price of $0.075 each as a result of an Entitlement Offer to shareholders, plus a further 15,702,666 shares were issued at an issue price of $0.075 each, for a shortfall of the Entitlement Offer placement.

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

DIRECTORS’ DECLARATION

In the opinion of the directors:

a. the consolidated financial statements and notes of Anteo Diagnostics Limited set out on pages 2 to 18 are in accordance with the Corporations Act 2001, including
i. giving a true and fair view of its financial position as at 31 December 2015 and of its performance for the half-year ended on that date; and
ii. complying with Accounting Standard AASB 134 Interim Financial Reporting; and
b. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

Signed in accordance with a resolution of the directors:

On behalf of the Directors

............................................. .. Mark Bouris Chairman

Dated 29[th] February 2016

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Level 18

King George Central 145 Ann Street Brisbane QLD 4000 Correspondence to: GPO Box 1008 Brisbane QLD 4001

T + 61 7 3222 0200 F + 61 7 3222 0444 E [email protected] W www.grantthornton.com.au

Auditor’s Independence Declaration To The Directors of Anteo Diagnostics Limited

In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the review of Anteo Diagnostics Limited for the half-year ended 31 December 2015, I declare that, to the best of my knowledge and belief, there have been:

a No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the review; and
b No contraventions of any applicable code of professional conduct in relation to the review.

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GRANT THORNTON AUDIT PTY LTD Chartered Accountants

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CDJ Smith Partner - Audit & Assurance

Brisbane, 29 February 2016

Grant Thornton Audit Pty Ltd ACN 130 913 594

a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.

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Level 18

King George Central 145 Ann Street Brisbane QLD 4000 Correspondence to: GPO Box 1008 Brisbane QLD 4001

T + 61 7 3222 0200 F + 61 7 3222 0444 E [email protected] W www.grantthornton.com.au

Independent Auditor’s Review Report To the Members of Anteo Diagnostics Limited

We have reviewed the accompanying interim financial report of Anteo Diagnostics Limited (“Company”), which comprises the consolidated financial statements being the consolidated statement of financial position as at 31 December 2015, and the consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the half-year ended on that date, notes comprising a statement or description of accounting policies, other explanatory information and the directors’ declaration of the consolidated entity, comprising both the Company and the entities it controlled at the half-year’s end or from time to time during the half-year.

Directors’ responsibility for the interim financial report

The directors of Anteo Diagnostics Limited are responsible for the preparation of the interim financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such controls as the directors determine is necessary to enable the preparation of the interim financial report that is free from material misstatement, whether due to fraud or error.

Auditor’s responsibility

Our responsibility is to express a conclusion on the consolidated interim financial report based on our review. We conducted our review in accordance with the Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the interim financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the Anteo Diagnostics Limited consolidated entity’s financial position as at 31 December 2015 and its performance for the half-year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001. As the auditor of Anteo Diagnostics Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.

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A review of an interim financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Independence

In conducting our review, we complied with the independence requirements of the Corporations Act 2001.

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the interim financial report of Anteo Diagnostics Limited is not in accordance with the Corporations Act 2001, including:

a giving a true and fair view of the consolidated entity’s financial position as at 31 December 2015 and of its performance for the half-year ended on that date; and
b complying with Accounting Standard AASB 134 Interim Financial Reporting and Corporations Regulations 2001.

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GRANT THORNTON AUDIT PTY LTD Chartered Accountants

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CDJ Smith Partner - Audit & Assurance

Brisbane, 29 February 2016

AI assistant

ANTEOTECH LTD — Interim / Quarterly Report 2016

64304_rns_2016-02-28_17736fa7-f44c-4f17-a972-7103ae34f901.pdf

ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625

INTERIM FINANCIAL REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

REVIEW OF OPERATIONS

DIASOURCE ACQUISITION

ANTEO GROUP STRATEGY

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

CORE SECTOR: DIAGNOSTICS

New Products – AMG Universal Coupling Kit and AMG 40nm Gold Kit

DIAsource

Highlights

Operations

Financial results

CORE SECTOR: ENERGY

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

CORE SECTOR: MEDICAL DEVICES

RESULT FOR THE PERIOD

DIRECTORS’ REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2015

DIVIDENDS

AUDITOR’S INDEPENDENCE DECLARATION

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE HALF YEAR ENDED 31 DECEMBER 2015

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2015

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 31 DECEMBER 2015

CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 31 DECEMBER 2015

1. Summary of accounting policies

Basis of Preparation

(a) Going Concern

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2015

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2015

4. Events Subsequent to Reporting Date

5. Equity Issued

DIRECTORS’ DECLARATION

Auditor’s Independence Declaration To The Directors of Anteo Diagnostics Limited

Independent Auditor’s Review Report To the Members of Anteo Diagnostics Limited

Directors’ responsibility for the interim financial report

Auditor’s responsibility

Independence

Conclusion

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ANTEOTECH LTD Interim / Quarterly Report 2016