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ANTEOTECH LTD — Interim / Quarterly Report 2017
Feb 26, 2017
64304_rns_2017-02-26_bca49ed7-fc8d-4686-be9b-f109ef2eee1c.pdf
Interim / Quarterly Report
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Appendix 4D Half-Year Report For the half-year ended 31 December 2016 ABN 75 070 028 625
This half-year report is provided to the Australian Stock Exchange (ASX) under ASX Listing Rule 4.2A.3. This information should be read in conjunction with the half-year report for the period to 31 December 2016.
Current reporting period: Previous corresponding period:
Half-year ended 31 December 2016 Half-year ended 31 December 2015
Results for Announcement to the Market
| Percentage Change |
Amount | |||
|---|---|---|---|---|
| % | €’000 | |||
| Revenue from ordinary activities | Up | 2,063% | to | 8,567 |
| Profit/(loss) from ordinary activities aftertaxattributable tomembers |
Down | 0.3% | to | (2,024) |
| Net profit/(loss) for the period attributable tomembers |
Down | 0.3% | to | (2,024) |
Dividends/distributions
| Amount per security | Franked amount per security |
|
|---|---|---|
| Final Dividend | Nil | Nil |
| Interim Dividend | Nil | Nil |
Net Tangible Assets
| 2016 € cents | 2015 € cents | |
|---|---|---|
| Net tangible asset backing per ordinary share |
2.4 | 0.01 |
Controlled entities acquired or disposed of
No controlled entities were acquired or disposed during the current half-year period.
Notes:
-
Reports are based on audited consolidated financial statements
-
All figures are presented in Euros, unless otherwise stated
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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 2016
ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
INTERIM FINANCIAL REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2016
| Contents | Page | Contents | Page |
|---|---|---|---|
| Corporate Directory | 1 | Statement of Cash Flows | 8 |
| Chairman’s Letter | 2 | Notes to the Financial Statements | 9 |
| Directors’ Report | 4 | Directors’ Declaration | 12 |
| Statement of Profit or Loss and Other Comprehensive Income |
5 | Auditor’s Independence Declaration | 13 |
| Statement of Financial Position | 6 | Independent Review Report | 14 |
| Statement of Changes in Equity | 7 |
CORPORATE DIRECTORY
Directors Dr John Hurrell Non-Executive Chairman/Director Dr Geoffrey Cumming Non-Executive Director Mr Richard Martin Non-Executive Director Mr Rolf Sickman Non-Executive Director Company Secretary Mr Peter Harding-Smith 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 Bankers Australia and New Zealand Banking Group Limited 3 Sherwood Road, Toowong QLD 4066
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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
CHAIRMAN’S LETTER FOR THE HALF YEAR ENDED 31 DECEMBER 2016
Dear Shareholders,
This past 6 months have been quite a roller coaster for all stakeholders in our company. We have seen some very positive developments but we have had some disappointments that have dampened the way we view the progress we have made and the options we have for moving forward.
In the period, two Board members, Mr Mark Bouris, our former Chairman, and Ms Sam Anderson both stood down due to other commitments. In addition, our long time Company Secretary, Mr. Shane Hartwig, stood down due to added responsibilities within his firm. Mr Richard Martin, after involvement from inception and an effective founder, stood down as CFO at the end of September 2016. We would like to thank all of them for their service and dedication to the Company.
On a positive note, we welcomed Mr Peter Harding-Smith to the company in October as Group CFO and Company Secretary. Peter is a Chartered accountant, a Fellow of the Governance Institute of Australia and has more than 10 years’ experience as CFO and Company Secretary of ASX listed companies. I was appointed Chairman in November of 2016 and requested that we do a careful review of the company and examine our strengths, weaknesses and the mission we are pursuing in order to determine the best alternatives to grow the company going forward over the coming years. We are also addressing the Corporate Governance of the Company and will be reviewing the structure and skill set of the Board to ensure we are appropriately positioned for the future.
Significant progress has been made both in the Anteo Diagnostics and DIAsource business activities. The Anteo Diagnostics team has continued to strengthen our patent portfolio in the area of medical devices with the filing of a number of new applications and others moving through the examination process. Anteo has also entered into funded collaborative relationships to apply the company’s nanotechnology to several Point of Care platforms. In particular, Anteo has become a participant within the Defense Materials Technology Center (DMTC), and in addition progressed relationships with Ellume, Planet Innovation and Atomo Diagnostics. These collaborations are all centered in Australia which makes the involvement by Anteo more easily managed and real time compared to previous collaborations that have been mostly based overseas. These relationships are in early stages however they represent broad applications of our core technology. It is anticipated these projects will lead to supply agreements when the products are commercialized.
DIAsource, our subsidiary located in Belgium, has continued to grow as anticipated. The company released 2 new products in the past half year, ELISA tests for the Zika virus and a unique test for free 25-hydroxy Vitamin D. Both assays were launched at the annual scientific and tradeshow meeting of the American Association of Clinical Chemists. Anteo Diagnostics also released 3 new products at the same meeting. We reported in the latest Appendix 4C, the DIAsource financial result for their financial year, which was calendar year 2016. Pleasingly, the result exceeded expectation in both revenue and EBIDTA driven by strong sales across the product lines but particularly by sales of the Vitamin D ELISA test products. The Board has been very satisfied with the performance and management of DIAsource to date.
DIAsource was a strategic acquisition to move the Anteo Group into the diagnostics mainstream, to provide a platform for future development, manufacture and distribution of the Anteo nanotechnology surface modification technology and to be a sustainable source of cash to fund future activities. We anticipated that the markets would see this as a positive move and the value and potential of the combined companies would be recognized. Unfortunately to the disappointment of the Board, management and shareholders this wasn’t the case. Our share price has eroded significantly since the acquisition to the great disappointment of all involved and has greatly reduced your Board’s flexibility as we move forward. I have heard from a number of you and I understand your frustration.
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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
CHAIRMAN’S LETTER FOR THE HALF YEAR ENDED 31 DECEMBER 2016
As a result of our review, the Board is pursuing several options to enable to company to execute its strategy and make a greater focused investment in the core technology to deliver commercially significant outcomes in the diagnostics, medical device and energy areas.
Yours faithfully,
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John Hurrell Chairman 27 February 2016
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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 2016
The Directors of Anteo Diagnostics Limited submit herewith the interim financial report for the halfyear ended 31 December 2016. 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: Dr John Hurrell Dr Geoffrey Cumming Mr Richard Martin Mr Rolf Sickman Ms Sam Anderson (ceased 24 August 2016) Mr Mark Bouris (ceased 14 November 2016)
REVIEW OF OPERATIONS
The six months has been a vastly different six months compared to prior year. The acquisition and performance of DIAsource has changed the nature of the group and is delivering strong top line and bottom line growth. The Australian operation has had its share of success with progress in the Medical Devices Area and Point of Care. Development within Energy, specifically in Li-ion batteries, has progressed but not at the speed at which we were expecting. This is a focus for Anteo over the next six months.
The Quarterly Activity Reports lodged with the ASX on the 31 January 2017 and the 31 October 2016 provide further details on the group’s performance during the six months to 31 December 2016.
RESULT FOR THE PERIOD
The net loss after tax for the half-year ending 31 December 2016 was €2,024,224 compared with a loss of €2,018,763 in the same period last year.
The significant change from last half-year to this half-year has been the acquisition of DIAsource Immunoassays SA, our Belgium subsidiary. The 31 December 2016 results includes a one-off adjustment for the earn out obligation of €2,898,602. The increase in earn out obligation reflects the strong second half year performance on the earn out parameters. Excluding this one-off adjustment, the Group made a profit after income tax of €874,378 for the six months.
As at 31 December 2016, the Company held cash and deposits of €2,331,406 (30 June 2016: €2,522,170).
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 13 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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John Hurrell, Chairman, Brisbane, 27[th] February 2017
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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 2016
| Note Sales revenue Cost of sales Gross Profit Other Income 2 Selling, distribution and business development expenses Occupancy expenses Administration expenses Borrowing costs Research and development expenses Earn out adjustment relating to acquisition Profit /(Loss) from ordinary activities before income tax Income tax expense Profit /(Loss) from ordinary activities after income tax Profit /(Loss) attributable to members of the parent entity Other Comprehensive Income Total Comprehensive Income (Loss) Basic earnings per share (cents per share) Diluted earnings per share (cents per share) |
31 December 2016 € 8,567,163 (3,938,658) 4,628,505 2,033,694 (1,114,533) (604,842) (2,276,186) (793,950) (866,058) (2,898,602) (1,891,972) (132,252) (2,024,224) (2,024,224) 180,800 (1,843,424) (0.16) (0.16) |
31 December 2015 € 396,275 - |
|---|---|---|
| 396,275 | ||
| 1,008,893 (656,829) (47,394) (1,553,125) - (1,166,584) - |
||
| (2,018,763) - |
||
| (2,018,763) | ||
| (2,018,763) | ||
| (114,034) | ||
| (2,132,797) | ||
| (0.26) (0.26) |
The financial statements should be read in conjunction with the accompanying notes.
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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
CONSOLIDATED STATEMENT OF FINANCIAL POSITION FOR THE HALF YEAR ENDED 31 DECEMBER 2016
| Note CURRENT ASSETS Cash Assets Receivables Inventories Other TOTAL CURRENT ASSETS NON-CURRENT ASSETS Property, plant and equipment Intangible assets Deferred tax asset Other financial assets TOTAL NON-CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Trade and Other Payables Financial liabilities Provisions TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Financial liabilities Provisions Deferred tax liability TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Contributed equity Convertible notes Share option reserve Foreign exchange reserve Accumulated losses TOTAL EQUITY |
31 December 2016 € 2,331,406 5,886,686 3,464,173 52,523 11,734,788 14,916,923 8,893,903 131,243 5,209 23,947,278 35,682,066 2,697,694 9,617,417 914,249 13,229,360 10,213,580 24,524 4,266,181 14,504,285 27,733,645 7,948,421 38,790,087 - 424,005 20,099 (31,285,770) 7,948,421 |
30 June 2016 € 2,522,170 4,696,382 3,400,838 72,017 |
|---|---|---|
| 10,691,407 | ||
| 15,374,118 8,893,903 271,400 5,209 |
||
| 24,544,630 | ||
| 35,236,037 | ||
| 3,069,697 7,547,311 804,370 |
||
| 11,421,378 | ||
| 10,107,839 33,673 4,357,761 |
||
| 14,499,273 | ||
| 25,920,651 | ||
| 9,315,386 | ||
| 36,961,415 1,370,672 501,753 (160,701) (29,357,753) |
||
| 9,315,386 |
The financial statements should be read in conjunction with the accompanying notes.
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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 2016
| Balance at 1 July 2015 Issued during the period 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 Other Comprehensive income Balance at 31 December 2015 Balance at 1 July 2016 Issued during the period Capital Raising Costs Conversion of Convertible notes in Ordinary Shares 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 Other Comprehensive income Balance at 31 December 2016 |
Ordinary Shares Convertible Notes Options Accumulated Losses Foreign Exchange Total € € € € € € 28,395,667 - 676,683 (25,570,584) 169,390 3,671,156 4,275,450 - - - - 4,275,450 (242,440) - - - - (242,440) - - 22,531 - - 22,531 - - (157,214) 157,214 - - - - - - - - - - - (2,018,763) - (2,018,763) - - - - (114,034) (114,034) |
|---|---|
| 32,428,677 - 542,000 (27,432,133) 55,356 5,593,900 |
|
| 36,961,415 1,370,672 501,753 (29,357,753) (160,701) 9,315,386 - 458,000 - - - 458,000 - 1,828,672 (1,828,672) - - - - - - 18,459 - - 18,459 - - (96,207) 96,207 - - - - - - - - - - - (2,024,224) - (2,024,224) - - - - 180,800 180,800 |
|
| 38,790,087 - 424,005 (31,285,770) 20,099 7,948,421 |
The financial statements should be read in conjunction with the accompanying notes.
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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF YEAR ENDED 31 DECEMBER 2016
CASH FLOWS FROM OPERATING ACTIVITIES: Receipts from customers Receipts from government grants and rebates Payments to suppliers and employees Borrowing costs Interest received Net cash (used in) operating activities CASH FLOWS FROM INVESTING ACTIVITIES: Payment for property, plant and equipment Cash placed on current deposit Net cash (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES: Capital raising costs Proceeds from share issues Proceeds for the issue of convertible notes Proceeds from borrowings Repayment of borrowings Repayment of finance leases Net cash (used in) provided by financing activities Net increase (decrease) increase in cash held Opening cash brought forward Foreign exchange effect Closing cash carried forward |
31 December 2016 € 7,331,336 1,651,448 (8,572,063) (829,457) 27,000 (391,736) (73,643) - (73,643) - - 458,000 655,948 (973,372) (36,824) 103,752 (361,627) 2,522,170 170,863 2,331,406 |
31 December 2015 € 387,982 - (3,141,119) - 14,735 |
|---|---|---|
| (2,738,402) | ||
| (105,208) (2,186,585) |
||
| (2,291,793) | ||
| (237,748) 4,216,434 - - - - |
||
| 3,978,686 | ||
| (1,051,509) 3,574,829 (116,548) |
||
| 2,406,772 |
The financial statements should be read in conjunction with the accompanying notes.
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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2016
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.
(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.
During the 2016 Financial Year, the Group acquired DIAsource Immunoassay SA, a Belgium based company. This acquisition was partly funded by Vendor finance totalling €7,700,000, of which €5,775,000 remains outstanding at the date of this report. Vendor funding repayments, including interest, of €2,282,262 plus an earn out estimated to be €6,344,000 are due in the next 12 months. The next repayment of €1,090,601 was made in January 2017, with the second repayment due in July 2017. The earn out is due in April 2017.
For the six months to 31 December, the Group reported a loss after income tax of €2,024,224. There was a once off adjustment to the earn out liability of €2,898,602. Removing this once-off adjustment would result in a profit after income tax of €874,378 for the six months.
The statement of financial position at 31 December indicates current liabilities exceeded current assets by €1,494,572. Excluding the current liability to the vendors of DIAsource, current assets exceed currently liabilities by €8,309,278.
The Board is considering a number of strategies to address the total obligation to the DIAsource vendors and is in discussion with a number of parties, including the vendors, advisors and brokers concerning a liquidity event to fund these impending obligations as well as the Group’s ongoing operational requirements over the next 12 months. Having assessed the different options available, the Board is of the view that the Company can meet its obligations as and when they fall due. As at 31 December 2016 the Group had €2,331,406 in cash reserves.
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.
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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2016
| 2. Results for the Half-year The loss before income tax expense has been determined after: Depreciation of non-current assets: Plant and equipment Furniture and office equipment Building Total depreciation of non-current assets Staff Remuneration Salaries Superannuation Share Based Payments Other Income R&D Tax Concession Rebate and grants Movement in provision due to change in estimate Interest – other corporations Other Expenses from ordinary activities Options Expense Investment Activity Financing Costs |
31 December 2016 € (298,318) (20,687) (221,768) (540,773) (2,269,382) (63,211) (18,459) (2,351,052) 1,673,694 333,000 27,000 2,033,694 (18,460) - (793,950) (812,410) |
31 December 2015 € (62,291) - - |
|---|---|---|
| (62,291) | ||
| (764,501) (72,109) (22,095) |
||
| (858,705) | ||
| 994,078 - 14,815 |
||
| 1,008,893 | ||
| (22,096) (621,375) (706,500) |
||
| (1,349,971) |
3. Segment Reporting
| Consolidated 31/12/2016 Revenue Other Income Total Revenue and other income Profit/(Loss) before income tax expense Income tax expense Profit/(Loss) after income tax expense Assets Segment Assets Segment liabilities Segment net assets Additions to non-current assets |
Australia Belgium Unallocated Total € € € € 86,444 8,480,719 - 8,567,163 1,414,133 592,561 27,000 2,033,694 |
|---|---|
| 1,500,577 9,073,280 27,000 10,600,857 |
|
| 511,348 1,964,508 (4,367,828) (1,891,972) - (132,252) - (132,252) |
|
| 511,348 1,832,256 (4,367,828) (2,024,224) |
|
| 426,790 34,458,740 796,536 35,682,066 574,550 14,077,596 13,081,499 27,733,645 |
|
| (147,760) 20,381,144 (12,284,963) 7,948,421 |
|
| - (73,643) - - |
10
ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2016
4. Events Subsequent to Reporting Date
On the 11 January 2017, Anteo Diagnostics made the next payment of €1,090,601 under the Vendor Finance Agreement.
After the reporting date, 5,000,000 unlisted options lapsed, being 5,000,000 unlisted options and a further 2,000,000 unlisted options were issued as part of an employment agreement with Anteo Diagnostics.
There were no other events subsequent to the reporting date.
5. Equity Issued
During the six months, Bergen Global Asset Management Inc elected to convert their convertible notes on the 1 August and 21 August 2016. As a result of the conversion, 83,741,179 shares were issued to Bergen at $0.035 and $0.036 respectively.
There was no other equity issues during the six months to 31 December 2016.
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ANTEO DIAGNOSTICS LIMITED AND ITS CONTROLLED ENTITIES ABN 75 070 028 625
DIRECTORS’ DECLARATION FOR THE HALF YEAR ENDED 31 DECEMBER 2016
In the opinion of the directors:
-
a. the consolidated financial statements and notes of Anteo Diagnostics Limited set out on pages 4 to 11 are in accordance with the Corporations Act 2001, including
-
i. giving a true and fair view of its financial position as at 31 December 2016 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
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John Hurrell Chairman
Dated 27[th] February 2017
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