Anteris Technologies Global Corp. — Interim / Quarterly Report 2012

Feb 29, 2012

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ASX RELEASE

29 February 2012

ASX Market Announcements Australian Stock Exchange Limited 10[th] Floor, 20 Bond Street SYDNEY NSW 2000

Half Yearly Report (Appendix 4D) for the 6 months ended 31 Dec 2011 Programs show good progress

Allied Healthcare invested further into Professor Ian Frazer’s vaccine company Coridon Revenue of over $3.6M from the distribution business

• The Directors of Allied Healthcare Group Limited (the "Company") are pleased to announce the operating results of the Company for the 6 months ended 31 December 2011. The current period accounts represent the consolidation of Allied Healthcare Group Investments Pty Ltd ( formerly Allied Medical Limited ) (and subsidiaries) and Allied Healthcare Group Limited ( formerly bioMD Limited ) (and subsidiary).

• Over the past 6 months the merger has been completed between the two groups with the ASX listed company now to be known as Allied Healthcare Group Limited (www.alliedhealthcaregroup.com.au). The overall loss for the period was $1.91M which includes costs associated with the merger and the consolidation of the two groups plus the increased activities around the regulatory filing for the Celxcel Pty Limited for the approval of the ADAPT technology and the Group’s share of losses from investment company Coridon Pty Limited.

The highlights for the 6 month period were:

• The successful merger of the Group.

• The company raised capital of $2.2M in a placement as part of the merger process. These funds were used to:

• Increase the Allied Healthcare Group Limited ownership percentage of Coridon Pty Limited, a company founded by Professor Ian Frazer with a focus on next generation vaccines

• Increase inventory for Allied Medical Pty Limited which had stronger sales compared to the previous 12 months

• The Net Tangible Assets (NTA) decreased overall due to the stock swap merger between the two companies resulting in a dilution affect rather than decrease in the assets of the company.

ABN 35 088 221 078 Level 1, 197 Adelaide Terrace Perth Western Australia 6000 PO Box 6879 East Perth Western Australia 6892 T +61 (0) 8 9385 5038 F +61 (0) 8 9385 5028 E info@alliedhealthcaregroup.com.au

www.alliedhealthcaregroup.com.au

• Overall liabilities were reduced by 20% while net assets were increased over the period.

• Strengthened the management team with the appointments of Mr Bob Atwill as CEO of Celxcel Pty Limited and executive at Allied Healthcare Group and Dr Julian Chick as COO of the Allied Healthcare Group Limited.

• The sales for the distribution businesses for the current period were $3.643 million, up from $3.557 in the corresponding period of the previous year. The total profit margin was down slightly for the period due to re-assignment of sales force focus which is expected to result in a stronger second half.

• Expiry of 72.9 million listed options on 31 December 2011.

Over the past 6 months the company has continued to pursue the Celxcel Pty Limited technology towards approval in major jurisdictions. The company is expecting to release updates on the regulatory progress on Australian, European and the US in the coming 6 months. Several studies have been undertaken and the company expects to release updates and results in the next 6 months.

In addition during the past 6 months, Coridon Pty Limited showed significant animal results in its Herpes vaccine study which demonstrated clearance of the virus. The program is now progressing towards an initial Phase I study which is scheduled to start in the second half of 2012.

Overall Allied Medical Pty Limited remains in a strong position and increased inventory has been built up ahead of the typically stronger second half of the year. Allied Medical Pty Limited maintains one of the largest infusion product portfolios in the Australian market.

The following half yearly report includes:

• Appendix 4D;

• Directors’ Report;

• Financial Report;

• Directors’ Declaration; and

• Audit Report and Independence Declaration.

Yours faithfully

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Stephen Mann Company Secretary

Appendix 4D

Half Yearly Report

Name of Entity:

ABN: Reporting Period: Previous corresponding Period:

Allied Healthcare Group Limited 35 088 221 078 Half year ended 31 December 2011 Half year ended 31 December 2010

Results for Announcement to the Market

				$A’000
Revenues from ordinary activities	down	6.6%	to	3,321
Loss from ordinary activities after tax	down	134.1%	to	(1,918)
Loss for the period attributable to members	down	127.8%	to	(1,866)

Dividends	Amount per security	Franked amount per security
Interim dividend	NIL¢	NIL¢
Previous corresponding period	NIL¢	NIL¢

Results Commentary

The overall loss for the equity holders of Allied Healthcare Group Limited was $1,866.068, compared to $819,193 for the previous period. The 2011 loss is for the post-merger consolidated group compared to the 2010 figure which is only for the Allied Healthcare Group Investments Limited group ( formerly Allied Medical Limited ) and included expense of $790,851 for the impairment of goodwill in Medevco Pty Limited.

The loss for the period is mainly attributed to costs associated with the merger and the recent regulatory activities relating to approval of the Celxcel Pty Limited technology and the Group’s share of losses from investment company Coridon Pty Limited.

Overall during the period the company made significant progress on the approval process for the Celxcel Pty Limited technology, including filing for approval for the CardioCel product with the Therapeutic Goods Administration (TGA) in Australia as well as planning for European and US approval. The company expects to provide further updates on the regulatory approval application progress over the coming 6 months.

During the period the Allied Medical Pty Limited continued to show a strong business, with sales from the business reaching $3.6 million for the period.

Also during the period Group also increased its investment into Coridon Pty Limited after positive animal study results. Coridon Pty Limited reported clearance of herpes virus in the study. Coridon Pty Limited is currently preparing to progress the herpes vaccine program into the initial human clinical study later in 2012.

Net Tangible Assets per security

	Current period	Previous corresponding period
Net tangible asset backing per ordinary security	0.87 cents per share	2.31 cents per share

The change in the Net Tangible Assets per security between the previous corresponding period and the current period can be attributed to the dilution due to merger between Allied Healthcare Group Investments Pty Limited and Allied Healthcare Group Limited. The NTA does not recognise any goodwill attributed to the Allied Healthcare Group Limited business.

Control gained over entities having material effect

N/A

Loss of control of entities having material effect

N/A

Details of aggregate share of profits (losses) of associated and joint venture entities

N/A

This report is based on:

The accounts have been subject to review.

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Sign here: (Company Secretary)

Date: 29 February 2012

Print name: Stephen Mann

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(ACN 088 221 078)

CONSOLIDATED HALF-YEAR FINANCIAL REPORT

31 DECEMBER 2011

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CORPORATE DIRECTORY

Directors

Christopher J. Catlow – Non Executive Chairman Lee E. Rodne – Managing Director Michael C. Bennett – Executive Director William G. Rowley – Non-executive Director Handojo (Jet) Soedirdja – Non-executive Director Robert E. Towner – Non-executive Director

Company Secretary

Stephen Mann

Company and Registered Office

Level 1, 197 Adelaide Terrace Perth, Western Australia 6000 Telephone: +61 8 9266 0100 Facsimile: +61 8 9266 0199 Website: www.alliedhealthcaregroup.com.au Email: info@alliedhealthcaregroup.com.au

Auditors

BDO Audit (WA) Pty Ltd 38 Station Street Subiaco, Western Australia 6008

Solicitors

Hardy Bowen Lawyers 1/28 Ord Street West Perth, Western Australia 6005

Bankers

ANZ 77 St Georges Terrace Perth, Western Australia 6000

Stock Exchange Listing

Australian Stock Exchange codes: AHZ (ordinary shares)

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DIRECTORS’ REPORT

The Directors present the half-yearly financial report on the consolidated entity (referred to hereafter as the ‘Consolidated Entity’ or ‘Group’) consisting of Allied Healthcare Group Limited and its controlled entities for the half-year ended 31 December 2011.

DIRECTORS

The following persons were Directors of the Company during the half-year and up to the date of this report:

Christopher J. Catlow

Lee E. Rodne Michael C. Bennett William G. Rowley Handojo (Jet) Soedirdja Robert E. Towner

Stephen Mann was appointed Company Secretary on 20 October 2011, Darren Bromley resigned on the same date.

PRINCIPAL ACTIVITIES

The principal activities of the Group during the half-year consisted of:

• The distribution business is focused on infusion and cardiology products used in hospital and ambulatory care. Allied Medical Pty Limited has a large portfolio of infusion and cardio related products in Australia and has seen strong growth in revenue over the past few years.

• Continued progression of the Celxcel Pty Limited’s ADAPT technology, with a particular focus on an initial approval for the technology. Celxcel Pty Limited progressed the filing of the CardioCel technology with the TGA as well as initiating discussions on regulatory approval in Europe and the US.

• � During the half year the Group increased its investment into Coridon Pty Limited, a company focused on developing DNA vaccines as the next generation vaccines. During the period Coridon Pty Limited reported results from a very successful herpes animal study which showed 100% clearance of the virus. Coridon Pty Limited is currently planning to initiate a Phase I study for the herpes vaccine program later in 2012.

REVIEW OF OPERATIONS AND RESULTS

The consolidat e d operating loss for the half-year:

	31 Dec 2011 $	31 Dec 2010 $
Loss before income tax	(1,952,397)	(754,454)
Income tax benefit / (expense)	34,882	(64,739)
Loss for the period	(1,917,515)	(819,193)

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DIRECTORS’ REPORT (continued)

The overall loss for the equity holders of Allied Healthcare Group Limited was $1,866,068, compared to $819,193 for the previous period. The 2011 loss is for the post-merger consolidated group compared to the 2010 figure which is only for the Allied Healthcare Group Investments Limited ( formerly Allied Medical Limited ) group and included expense of $790,851 for the impairment of goodwill in Medevco Pty Limited.

The loss for the period is mainly attributed to costs associated with the merger and the recent regulatory activities relating to approval of the Celxcel Pty Limited technology and the Group’s share of losses from investment company Coridon Pty Limited.

Overall during the period the company made significant progress on the approval process for the Celxcel Pty Limited technology, including filing for approval for the CardioCel product with the Therapeutic Goods Administration (TGA) in Australia as well as planning for European and US approval. The company expects to provide further updates on the regulatory approval application progress over the coming 6 months.

During the period the Allied Medical Pty Limited continued to show a strong business, with sales from the business reaching $3.6 million for the period.

Also during the period Group also increased its investment into Coridon Pty Limited after positive animal study results. Coridon Pty Limited reported clearance of herpes virus in the study. Coridon Pty Limited is currently preparing to progress the herpes vaccine program into the initial human clinical study later in 2012.

SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS

No significant changes have occurred in the state of affairs of the consolidated entity.

DIVIDENDS

No dividend was paid during the half-year and the Board has not recommended the payment of a dividend.

EVENTS SUBSEQUENT TO REPORTING DATE

On 12 January 2012, the Company issued 3,641,911 shares upon the exercise of 3,641,911 listed options at $0.04 to raise $145,676. The Company also announced the lapse of the remaining 72,691,484 listed options which expired 31 December 2011.

AUDITORS INDEPENDENCE DECLARATION

Section 307C of the Corporations Act 2001 requires our auditors, BDO Audit (WA) Pty Ltd, to provide the directors of the company with an Independence Declaration in relation to the review of the interim financial report. This Independence Declaration is set out on page 5 and forms part of this directors’ report for the half-year ended 31 December 2011.

This report is signed in accordance with a resolution of the Board of Directors made pursuant to s.306(3) of the Corporations Act 2001.

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Christopher J Catlow Chairman

Dated at Perth, Western Australia this 29[th] day of February 2012.

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38 Station Street Subiaco, WA 6008 PO Box 700 West Perth WA 6872 Australia

Tel: +8 6382 4600 Fax: +8 6382 4601 www.bdo.com.au

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29 February 2012

The Board of Directors Allied Healthcare Group Limited Level 1, 197 Adelaide Tce, PERTH WA 6000

Dear Sirs,

DECLARATION OF INDEPENDENCE BY BRAD MCVEIGH TO THE DIRECTORS OF ALLIED HEALTHCARE GROUP LIMITED

As lead auditor of Allied Healthcare Group Limited for the period ended 31 December 2011, I declare that, to the best of my knowledge and belief, there have been no contraventions of:

• the auditor independence requirements of the Corporations Act 2001 in relation to the halfyear review; and

• any applicable code of professional conduct in relation to the review.

This declaration is in respect of Allied Healthcare Group Limited and the entities it controlled during the period.

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Brad McVeigh Director

BDO Audit (WA) Pty Ltd

Perth, Western Australia

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation (other than for the acts or omissions of financial services licensees) in each State or Territory other than Tasmania.

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STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

CONSOLIDATED

		CONSOLIDATED
Note Revenue from continuing operations 2 Cost of sales Gross Profit Other income Administrative expenses Employee benefits Consultancy fees Travel costs Share based payments Impairment expense Asset write-down Loss from equity accounting 7 Depreciation expense Loss before income tax from continuing operations Income tax benefit / (expense) Loss for the half-year Other comprehensive income for the half-year Total comprehensive loss for the half-year Total comprehensive loss for the half-year is attributable to Equity holders of Allied Healthcare Group Limited Non controlling interests Loss per share (cents per share) from continuing operations attributable to ordinary equity holders of the Company Basic loss per share Diluted loss per share The above Consolidated Statement of Comprehensive Income accompanying notes.	Note	31 Dec 2011 $ 31 Dec 2010 $
	2	3,320,856 3,557,300 (1,794,276) (1,917,882)
		1,526,580 1,639,418 12,881 60,280 (875,048) (313,328) (1,260,664) (905,472) (665,117) (98,426) (181,087) (93,432) (102,000) (250,000) - (790,851) (48,898) - (344,961) - (14,083) (2,643)
		(1,952,397) (754,454) 34,882 (64,739)
		(1,917,515) (819,193) - -
		(1,917,515) (819,193)
		(1,866,068) (819,193) (51,447) -
		(1,917,515) (819,193)
		Cents Cents (0.322) (0.132) N/A N/A should be read in conjunction with the

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STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2011

STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2011
ASSETS Current assets Cash and cash equivalents Trade and other receivables Inventories Income tax receivable Total current assets Non-current assets Investments accounted for using the equity method Property, plant & equipment Intangible assets Deferred tax asset Total non-current assets Total assets LIABILITIES Current liabilities Trade and other payables Provisions Current tax payable Total current liabilities Non-current liabilities Provisions Borrowings Total non-current liabilities Total liabilities NET ASSETS EQUITY Contributed equity Reserves Accumulated losses Capital and reserves attributable to equity holders of Allied Healthcare Group Limited Non controlling interest TOTAL EQUITY	Note	CONSOLIDATED 31 Dec 2011 $ 30 June 2011 $
	7 8 9	605,920 1,354,254 1,690,631 11,199 3,662,004 2,270,394 137,058 8,962,545 167,341 11,537,338 15,199,342 570,352 201,273 - 771,625 99,437 20,054 119,491 891,116 14,308,226 16,219,674 752,420 (2,611,568) 14,360,526 (52,300) 14,308,226	1,351,518 1,217,279 1,722,341 -
			4,291,138
			1,245,355 132,846 8,947,399 131,441
			10,457,041
			14,748,179
			808,652 160,192 24,224
			993,068
			96,624 20,054
			116,678
			1,109,746
			13,638,433
			13,925,166 459,620 (745,500)
			13,639,286 (853)
			13,638,433

The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.

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STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

CONSOLIDATED

	CONSOLIDATED
	Share Capital $ Share- based payment Reserves $ Accum Losses $ Total $ Non controlling Interest $ Total Equity $
Balance at 1 July 2010 Loss for the period Total comprehensive loss for the half-year Transactions with owners in their capacity as owners Shares issued during the period Balance at 31 December 2010 Balance at 1 July 2011 Loss for the period Total comprehensive loss for the half-year Transactions with owners in their capacity as owners Shares issued during the period Options issued during the period Shares issued to set-up equity facility Capital raising costs Exercise of options Balance at 31 December 2011
	29,914 - 1,207,295 1,237,209 - 1,237,209
	- - (819,193) (819,193) - (819,193)
	- - (819,193) (819,193) - (819,193) 3,046,850 - - 3,046,850 - 3,046,850 3,076,764 - 388,102 3,464,866 - 3,464,866
	13,925,166 459,620 (745,500) 13,639,286 (853) 13,638,433
	- - (1,866,068) (1,866,068) (51,447) (1,917,515)
	- - (1,866,068) (1,866,068) (51,447) (1,917,515) 2,201,451 - - 2,201,451 - 2,201,451 102,000 - 102,000 - 102,000 - 190,800 - 190,800 - 190,800 (210,399) - - (210,399) - (210,399) 303,456 - - 303,456 - 303,456
	16,219,674 752,420 (2,611,568) 14,360,526 (52,300) 14,308,226

The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.

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STATEMENT OF CASH FLOWS FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

Cash flows from operating activities Receipts from customers Payments to suppliers Interest received Interest paid Income tax paid Net cash outflow from operating activities Cash flows from investing activities Payments for property, plant & equipment Purchase of equity accounted investments Payments for intangible assets Net cash outflow from investing activities Cash flows from financing activities Proceeds from issue of shares Proceeds from exercise of options Share issue transaction costs Net cash inflow from financing activities Net decrease in cash held Cash at the beginning of the half-year Cash at end of the half-year		CONSOLIDATED Half-year 31 Dec 2011 $ Half-year 31 Dec 2010 $	CONSOLIDATED Half-year 31 Dec 2011 $ Half-year 31 Dec 2010 $
		3,215,207 (4,894,679) (1,679,472) 14,294 (7,393) (36,441) (1,709,012) (18,296) (1,370,000) (15,146) (1,403,442) 2,207,261 278,047 (118,452) 2,366,856 (745,598) 1,351,518 605,920	2,927,888 (3,720,251)
			(792,363)
			9,041 - (153,150)
			(936,472)
			- (900,000) -
			(900,000)
			2,199,427 (77,558)
			2,121,869
			285,397
			378,529
			663,926

The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The half-year financial report is a general-purpose financial report, which has been prepared in accordance with the Corporations Act 2001 and Accounting Standard AASB 134 Interim Financial Reporting . The halfyear financial report has been prepared in accordance with the historical cost convention.

This half-year financial report does not include all the notes of the type normally included within the annual financial report and accordingly, this report should be read in conjunction with the annual financial report for the year ended 30 June 2011 and any public announcements made by Allied Healthcare Group Limited during the interim period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period.

2. REVENUES

Revenue from continuing operations Sales Total revenue from continuing operations Breakdown of Other Revenue Bank interest Other income	Half-year 2011 $ 3,320,856 3,320,856 14,294 (1,413) **12,881 **	Half-year 2010 $
		3,557,300
		3,557,300
		9,041 51,239
		60,280

3. EXPENSES

Loss for the half-year before income tax includes the following specific expenses:

	Half-year	Half-year
	2011	2010
	$	$
Consultancy fees	665,117	98,426
Travel costs	181,087	93,432
Depreciation – Plant and equipment	14,083	2,643
Impairment expense	-	790,851
Asset write-downs	48,898	-
Employee benefits expense
Salary and wages	1,105,180	810,245
Leave provisions	82,011	62,712
Other benefits	73,473	32,515

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

4. SUBSEQUENT EVENTS

On 12 January 2012, the Company issued 3,641,911 shares upon the exercise of 3,641,911 listed options at $0.04 to raise $145,676. The Company also announced the lapse of the remaining 72,691,484 listed options which expired 31 December 2011.

5. SEGMENT INFORMATION

Description of segments

In accordance with AASB 8 Operating Segments, segment information is presented using a management approach, i.e. segment information is provided on the same basis as information as used for internal reporting purposes by the chief operating decision makers (board of directors that make key strategic decisions).

Management has determined that there are two identifiable reportable segments as follows:

• Disposable medical products and medical devices distribution; and

• Bioimplants operations of Celxcel Pty Ltd.

Total segment revenue Segment profit / loss before income tax Segment assets Segment liabilities		Medical products & devices Bioimplants Unallocated Total Dec 2011 $ Dec 2010 $ Dec 2011 $ Dec 2010 $ Dec 2011 $ Dec 2010 $ Dec 2011 $ Dec 2010 $
		3,642,856 3,557,300 - - (322,000) - 3,320,856 3,557,300 29,902 36,397 (227,137) - (1,755,162) (790,851) (1,952,397) (754,454) Dec 2011 $ Jun 2011 $ Dec 2011 $ Jun 2011 $ Dec 2011 $ Jun 2011 $ Dec 2011 $ Jun 2011 $
		5,770,624 4,913,634 90,106 161,281 9,338,612 9,673,264 15,199,342 14,748,179 2,002,260 753,143 199,291 43,329 (1,310,435) 313,274 891,116 1,109,746

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

5. SEGMENT INFORMATION (continued)

Performance is measured based on segment result before tax.

The reconciliation of segment information to loss for the half-year is as follows:

CONSOLIDATED

Segment profit (loss) Other revenue Administration costs Consultancy fees Employee costs Travel costs Impairment expense Loss from equity accounting Share based payments Loss for the half-year before income tax	Dec 2011 $ (197,235) 9,632 (754,901) (494,730) (29,318) (38,884) - (344,961) (102,000) (1,952,397)	Dec 2010 $
		36,397 - - - - - (790,851) - -
		(754,454)

6. DIVIDENDS

No dividends have been declared or paid during the period.

7. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

Investments Investment in Coridon (unlisted security) Movement Opening balances Additional investment Disposals Asset write-down Loss from equity accounting Closing balance	31 December 2011 $ 2,270,394 1,245,355 1,370,000 - - (344,961) 2,270,394	30 June 2011 $
		1,245,355
		- 1,430,000 - - (184,645)
		1,245,355

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

8. CONTRIBUTED EQUITY

(a) Share Capital Ordinary shares Fully paid Movements in Ordinary Share Capital Opening balance Options exercised Shares issued for associated costs with set-up of equity facility Shares issued in relation to business combination Share placement Capital raising costs Closing balance	SHARES $ 31 December 2011 31 December 2010 31 December 2011 31 December 2010
	656,382,383 10,504,534 16,219,674 3,076,764
	564,561,349 4,410,835 13,925,166 29,914 7,586,412 - 303,456 - 5,611,765 - (190,800) - - 847,423 423,712 78,622,857 5,246,276 2,201,451 2,623,138 - - (19,599) -
	656,382,383 10,504,534 16,219,674 3,076,764

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

9. RESERVES

Share based payments reserve Movement Opening balances Share issued to set-up Kodiak equity facility Options issued to Bell Potter Closing balance	31 December 2011 $ 752,420 459,620 190,800 102,000 752,420	30 June 2011 $
		459,620
		- - 459,620
		459,620

Share based payments reserve consists of 5,611,765 shares issued to Kodiak Capital Group LLC as commitment shares post signing agreement to set-up equity facility to provide the Group funding of up to US$3,000,000 drawn down in parcels of US$500,000 at the Group’s discretion. The reserve also consist of 6,000,000 unlisted options exercisable at $0.06 expiring on 20 October 2014 issued to Bell Potter Securities Limited in accordance with agreement for Placement.

Fair Value of Options Granted

The assessed fair value at grant date of options granted during the period ended 31 December 2011 was 1.7 cents per option. The fair value at grant date is independently determined using a Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option.

The model inputs for options granted during the period ended 31 December 2011 included:

• (a) options are granted for no consideration and vest based on holder still being employed by Allied Healthcare Group Limited over a three year period. Vested options are exercisable for a period up to expiry date.

• (b) exercise price: $0.06

• (c) grant date: 20 October 2011

• (d) expiry date: 20 October 2014

• (e) share price at grant date: $0.036

• (f) expected price volatility of the company's shares: 90%

• (g) risk-free interest rate: 3.88%

The expected price volatility is based on the historic volatility (based on the remaining life of the options), adjusted for any expected changes to future volatility due to publicly available information.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2011

10. COMMITMENTS

Total expenditure commitments at reporting date not provided for in the financial statements.

(a) Operating Lease Commitments Future operating lease commitments not provided for in the financial statements and payable: Within one year Later than one year but no later than five years The Company leases office space under an operating lease that expires in May 2013 with option for additional 2 years.	CONSOLIDATED 31 December 2011 $ 30 June 2011 $
	104,671 - 53,109 -
	157,780 -

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DIRECTORS’ DECLARATION

In the Directors’ opinion:

• (a) the financial statements of the consolidated entity are in accordance with the Corporations Act 2001; including:

• (i) complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 and other mandatory professional requirements, and

• (ii) giving a true and fair view of the consolidated entity’s financial position as at 31 December 2011 and of its performance for the half-year ended on that date; and

• (b) there are reasonable grounds to believe that Allied Healthcare Group Limited will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Directors.

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Christopher J. Catlow Chairman

Perth, Western Australia

Dated this 29[th] day of February 2012

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38 Station Street Subiaco, WA 6008 PO Box 700 West Perth WA 6872 Australia

Tel: +8 6382 4600 Fax: +8 6382 4601 www.bdo.com.au

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INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF ALLIED HEALTHCARE GROUP LIMITED

Report on the Half-Year Financial Report

We have reviewed the accompanying half-year financial report of Allied Healthcare Group Limited, which comprises the statement of financial position as at 31 December 2011, and the statement of comprehensive income, statement of changes in equity and statement of cash flows for the half-year ended on that date, notes comprising a statement of accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising the disclosing entity and the entities it controlled at the half-year’s end or from time to time during the half-year.

Directors’ Responsibility for the Half-Year Financial Report

The directors of the disclosing entity are responsible for the preparation of the half-year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half-year 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 half-year financial report based on our review. We conducted our review in accordance with 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 half-year financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity’s financial position as at 31 December 2011 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 Allied Healthcare Group Limited, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half-year 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 have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of Allied Healthcare Group Limited, would be in the same terms if given to the directors as at the time of this auditor’s report.

BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation (other than for the acts or omissions of financial services licensees) in each State or Territory other than Tasmania.

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Basis for Qualified Conclusion

Included in Allied Healthcare Group Limited’s consolidated statement of financial position as at 31 December 2011 is an investment of 37.27% in the associate Coridon Pty Limited which is accounted for under the equity method and is carried at $2,270,394. From the time Coridon Pty Limited became an associate, Allied Healthcare Group Limited’s share of the net loss is $344,961 which is included in the consolidated statement of comprehensive income for the period ended 31 December 2011. As the company is unaudited we were unable to obtain sufficient appropriate audit evidence to verify the valuation of the investment or its losses brought to account for the period and as such we were unable to determine whether any adjustments to these amounts are necessary. Given this limitation of scope we cannot, and do not express an opinion on the balance of investments or the result of the associate included in the consolidated statement of comprehensive income for the period ended 31 December 2011, or any consequential impact it may have on the carrying value of the investment.

Qualified Conclusion

Based on our review, which is not an audit, except for the effects of the matter described in the Basis for Qualified Conclusion paragraph, we have not become aware of any matter that makes us believe that the half-year financial report of Allied Healthcare Group 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 2011 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 .

BDO Audit (WA) Pty Ltd

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Brad McVeigh Director

Perth, Western Australia Dated this 29[th] day of February 2012

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