BABYLON PUMP & POWER LIMITED — Interim / Quarterly Report 2009

Jan 29, 2009

Appendix 4C Quarterly report for entities admitted on the basis of commitments

Rule 4.7B

30 January 2009

Appendix 4C – Quarter ended 31 December 2008

IM Medical Limited (“the Company”) presents its Appendix 4C Cash Flow Statement for the quarter ended 31 December 2008.

Net operating cash outflows were $0.319m, compared to the previous quarter outflow of $0.889m. Cash outflows were reduced in part to receipt of its Tax Office R&D Offset payment of $0.356m. Further reduction in staff numbers will assist cash flows in the coming months.

Net financing cash inflows for the December quarter were $0.059m following a drawdown under the $5m Fortrend Standby Subscription Agreement. The company has also made a further drawdown under the facility on 23 January 2009. This resulted in a drawdown of $0.068m.

The company had cash balances of $0.135m and $4.8m drawdown facilities available under the Fortrend Standby Subscription Agreement.

Since 31 December 2008, the company has secured $0.258m from a private placement of shares and the $0.068m from Fortrend as mentioned above.

As previously announced, the directors continue to be actively engaged in consideration of complimentary opportunities for the company, so that the health offerings of the company can be expanded and shareholder value enhanced.

Roman Najdecki Company Secretary

• See chapter 19 for defined terms.

24/10/2005

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

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Introduced 31/3/2000. Amended 30/9/2001, 24/10/2005.

Name of entity
IM Medical Limited
ABN 47 009 436 908	Quarter ended (“current quarter”)
47 009 436 908	31 December 2008

Consolidated statement of cash flows

	Cash flows related to operating activities 1.1 Receipts from customers 1.2 Payments for (a) staff costs (b) advertising and marketing (c) research and development (d) leased assets (e) other working capital 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other (provide details if material) Termination and severance payments – one off Net operating cash flows	Current quarter $A’000	Year to date (6 months) $A’000
		314 (387) (37) (4) - (162) -- 3 (8) - -	356 (782) (64) (16) - (745) -- 22 (11) - (106)
		(281)	(1,346)

• See chapter 19 for defined terms.

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

	Current quarter $A’000	Year to date (6 months) $A’000
1.8 Net operating cash flows (carried forward)	(281)	(1,346)
Cash flows related to investing activities 1.9 Payment for acquisition of: (a) businesses (item 5) (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets 1.10 Proceeds from disposal of: (a) businesses (item 5) (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets 1.11 Loans to other entities 1.12 Loans repaid by other entities 1.13 Other (provide details if material) Net investing cash flows 1.14 Total operating and investing cash flows	- - - (38) - - - - - - - - -	- - - (38) - - - - 70 - - - -
	(38)	32
	(319)	(1,314)
Cash flows related to financing activities 1.15 Proceeds from issues of shares, options, etc. 1.16 Proceeds from sale of forfeited shares 1.17 Proceeds from borrowings 1.18 Repayment of borrowings 1.19 Dividends paid 1.20 Other (provide details if material) Net financing cash flows	60 - (1) -	193 - (7) -
	59	186
Net increase (decrease) in cash held 1.21 Cash at beginning of quarter/year to date 1.22 Exchange rate adjustments to item 1.20 1.23 Cash at end ofquarter	(260) 395 -	(1,128) 1,263 -
	135	135

• See chapter 19 for defined terms.

24/10/2005

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

Payments to directors of the entity and associates of the directors

Payments to related entities of the entity and associates of the related entities

1.24 Aggregate amount of payments to the parties included in item 1.2 1.25 Aggregate amount of loans to the parties included in item 1.11	Current quarter $A'000
	30
	-

1.26	Explanation necessaryfor an understandingof the transactions
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Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

• 2.2 Details of outlays made by other entities to establish or increase their share in businesses in which the reporting entity has an interest

Financing facilities available

Add notes as necessary for an understanding of the position. (See AASB 1026 paragraph 12.2).

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	20	3

• See chapter 19 for defined terms.

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

Reconciliation of cash

Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A’000	Previous quarter $A’000
4.1 Cash on hand and at bank 4.2 Deposits at call 4.3 Bank overdraft 4.4 Other (provide details)	10	270
	125	125
	-	-
	-	-
Total: cash at end of quarter(item 1.23)	135	395

Acquisitions and disposals of business entities

5.1 Name of entity 5.2 Place of incorporation or registration 5.3 Consideration for acquisition or disposal 5.4 Total net assets 5.5 Nature of business	Acquisitions (Item 1.9(a))	Disposals (Item 1.10(a))

Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act (except to the extent that information is not required because of note 2) or other standards acceptable to ASX.

• 2 This statement does / ~~does not*~~ (delete one) give a true and fair view of the matters disclosed.

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Sign here: ............................................................ Date: 30 January 2009 ( ~~Director/~~ Company Secretary)

Print name: Roman Najdecki

• See chapter 19 for defined terms.

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

Notes

1. The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

2. The definitions in, and provisions of, AASB 1026: Statement of Cash Flows apply to this report except for the paragraphs of the Standard set out below.

3. 6.2 - reconciliation of cash flows arising from operating activities to operating profit or loss

4. • 9.2 - itemised disclosure relating to acquisitions

5. 9.4 - itemised disclosure relating to disposals

6. • 12.1(a) - policy for classification of cash items • 12.3 - disclosure of restrictions on use of cash • 13.1 - comparative information

7. Accounting Standards. ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

8. See chapter 19 for defined terms.

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