HOLISTA COLLTECH LIMITED — Annual Report 2011

Aug 29, 2011

Appendix 4E Preliminary Final Report 30 June 2011

Appendix 4E

PRELIMINARY FINAL REPORT 12 MONTHS ENDED 30 JUNE 2011

Details of the reporting period and the previous corresponding period

Name of entity

Holista CollTech Limited

Reportingperiod	Previous correspondingperiod
12 months ended 30/06/11	12 months ended 30/06/10

Results for announcement to the market

Revenues from continuing activities Down 3.4% to A$6,021,082 Loss from ordinary activities after tax attributable to members Net Loss for the year attributable to Members Up Down 29.8% 44.7% to to A$803,582 A$851,501
Dividends	Amount per security		Franked amount per security
Interim dividend Final Dividend		Nil Nil	Nil Nil
Record date for determining entitlements to the dividend N/A Revenue reduced by 3.4% as compared to previous year and is mainly due to the strengthening of Australian Dollar against the Malaysian Ringgit. During the year, the Malaysian operation was the only income contributor to the Group. Hence, the strengthening of Australian Dollar has had a significant adverse impact on the Group’s result. Loss from ordinary activities after tax attributable to members has increased by 29.8% due to the increase in Advertising and Promotions, and the Research & Development costs incurred during the year. The Net Loss for the year attributable to members has reduced by 44.7% in the current year. The difference is attributed to the writing off of intangible assets, A$920,440, during the last financial year.

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Appendix 4E Preliminary Final Report 30 June 2011

REVIEW OF OPERATIONS

Further to the completion of reverse takeover, the Group has continued to rationalize and consolidate both our operation in Australia and Malaysia, which has resulted in cost reductions and improved efficiencies. This has contributed to the reduction of Net Loss from AUD1.54 million in 2009/2010 to AUD0.85 million in current year.

The Health Supplement Business from our Malaysia Subsidiaries is the main income contributor of the Group. Besides our more reputable brand such as PRISTIN, LACTO-5 and BONEX, we have recently launched our latest supplement in March 2011, VASQUINN, which is the most absorbable CoQ10. Our special Licaps technology has made VASQUINN the most absorbable CoQ10 in the market. The latest Nielsen survey has shown that our fish oil – PRISTIN – is again the market leader in Malaysia for the 3[rd] consecutive year.

As far as Research & Development products are concerned, we have made the following progress:

i) Food Ingredient Business

We have filed a patent that will reduce the absorption of fat when cooking potato fries as per our announcement on 24 September 2010. We have also filed a low sodium salt patent in January 2011 and a low glycemic index patent in January 2009.

Put together, these 3 patents represent a major solution to the “4S Tsunami”. These “4S”s stand for Sodium, Salt, Starch and Sugar which are increasingly being linked to the unleashing of the global epidemics of obesity, diabetes and cardiovascular disease.

Working together, these patents can deliver the following:

• a) A bread with lower Glycemic Index of up to 40%;

• b) A low sodium and high potassium salt with up to 50% sodium and no metallic or bitter after taste and; c) A potato chip/fry which has 40% less fat with crispier result

We believe this will be an instant hit in the future as people are more health conscious nowadays. This could be the revolution in the “fast food” and “processed food” industries where one can continue to consume their favourite “fast food” and “processed food” without the guilt and ill health consequences.

We are currently testing this with a large Australian fast food chain, and are working with one of the largest fast food chains in the world on additional global development opportunities. The Company is also in the midst of applying for a grant in Australia for further development of these technologies.

ii) Collagen Business

While our Malaysian operation is showing positive progress, we continue to pursue the development of our Collagen business, which originated from Australia. The increased in sheep skin prices from AUD4 per skin to AUD25 per skin will not hamper our intention to commercialise our Food Grade Sheep Collagen. Instead, we continue to find new ways and processes to extract collagen from alternative sheep products to mitigate the price increase. We are also looking to develop marine collagen to help fill the market need and at the same time could mitigate the volatility of sheep skin supply.

We have completed the initial Research & Development for the digestion of the intact collagen to food grade collagen with the size of 3kilo Daltons using a mix of “halal” enzymes. We have also filed for the first time in the world a nano collagen patent. This will be an innovation in the highly competitive cosmetic industry.

In order to accelerate the commercialisation of our collagen business, we are in the midst of discussion with two large private equity firms and a halal biologics manufacturer to build a collagen extraction plant in Malaysia

We also created a joint venture in Pune, India, which will further develop and manufacture Indians and Malaysian herbs.

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Appendix 4E Preliminary Final Report 30 June 2011

The Board of Directors believe that Holista Colltech Ltd will continue to show good progress and will continue to work hard to enhance the value of our Group.

INCOME STATEMENT

Revenue Other Income Change in inventories of finished goods and work in progress Raw Materials and consumables used Employee benefits expense Depreciation and amortisation expense Impairment of non-current assets Borrowing costs expense Other expenses Loss before income tax expense Income tax expense Net loss for the year Other comprehensive income Exchange differences on translation of foreign operations Total comprehensive loss for the year Basic loss per share (cents per share) Diluted loss per share (cents per share)	2011 A$ 000 2010 A$ 000 6,021 6,235 56 495 (104) 223 (2,256) (2,415) (1,596) (1,958) (247) (255) - (920) (307) (337) (2,371) (2,635)
	(804) (1,567) - (6)
	(804) (1,573)
	(48) 33
	(852) (1,540)
	0.666 cents 1.304 cents 0.666 cents 1.304 cents

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BALANCE SHEET

CURRENT ASSETS Cash and cash equivalents Trade and other receivables Inventories Other TOTAL CURRENT ASSETS NON-CURRENT ASSETS Property, plant and equipment Intangible assets TOTAL NON-CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Trade and other payables Borrowings Current tax liabilities Other liabilities TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Borrowings TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Forex translation reserve Accumulated losses TOTAL EQUITY

2011 A$ 000 2010 A$ 000 1,721 3,194 1,356 1,471 982 1,420 12 33 4,071 6,118 4,018 4,445 203 22 4,221 4,467 8,292 10,585 765 759 2,501 2,558 29 32 289 1,011 3,584 4,360 914 1,579 914 1,579 4,498 5,939 3,794 4,646 7,680 7,554 13 61 (3,899) (2,969) 3,794 4,646

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STATEMENT OF CHANGES IN EQUITY

EQUITY Balance as at 1 July 2009 Loss for the year Shares issued during the year Exchange differences arising on translation of foreign operations Balance as at 30 June 2010 Balance as at 1 July 2010 Loss for the year Exchange differences arising on translation of foreign operations Balance as at 30 June 2011	Ordinary Shares Accumulate d Losses Other Reserve Total A$ 000 A$ 000 A$ 000 A$ 000 2,572 (1,396) 28 1,204 (1,573) - (1,573) 4,982 - - 4,982 - - 33 33
	7,554 (2,969) 61 4,646
	7,554 (2,969) 61 4,646 (804) - (804) - - (48) (48)
	7,554 (3,773) 13 3,794

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Appendix 4E Preliminary Final Report 30 June 2011

STATEMENT OF CASH FLOWS

CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Interest received Finance costs Government grant Income tax paid Net cash (used in) operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant and equipment Loan to other entity Net cash (used in) / generated from investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares Proceeds from borrowings Repayment of borrowings Net cash (used in) / generated from financing activities Net (decrease) / increase in cash held Cash at the beginning of the financial year Effect of currency fluctuations on cash Cash at the end of the financial year	2011 A$ 000 2010 A$ 000 6,099 6,292 (5,874) (8,122) 56 50 (307) (337) - 157 (53) (21)
	(79) (1,981)
	(275) (10) - 408
	(275) 398
	- 2,975 234 309 (836) (1,080)
	(1,190) 2,204
	(1,190) 621 2,409 1,755 (190) 33
	1,029 2,409

Reconciliation to Cash Flow Statement

For the purposes of the cash flow statement, cash and cash equivalents comprise cash on hand and at bank and investments in money market instruments, net of outstanding bank overdrafts.

Cash and cash equivalents as shown in the statement of cash flows is reconciled to the related items in the statement of financial position as follows:

Cash and cash equivalents as per balance sheet Bank overdraft Cash and cash equivalents as per cash flow statement	1,721 3,194 (692) (785)
	1,029 2,409

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NOTES

1 BASIS OF PREPARATION

The preliminary final report of Holista CollTech Limited for the year ended 30 June 2011 does not include all notes of the type normally included within the annual financial report and therefore can not be expected to provide as full understanding of the financial performance, financial position and cash flow of the company as the full financial report.

(a) Basis of accounting

This preliminary final report is a general purpose financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001, Accounting Standards and Interpretations and complies with other requirements of the law.

The preliminary final report has also been prepared on a historical cost basis, except for available-for-sale investments, which have been measured at fair value. Cost is based on the fair values of the consideration given in exchange for assets.

The preliminary final report is presented in Australian dollars and all values are rounded to the nearest thousand dollars (A$’000) unless otherwise stated under the option available to the Company under ASIC Class Order 98/100.

Unless otherwise detailed in this note, accounting policies have been consistently applied by the Company and are consistent with those applied in the 30 June 2010 annual report.

2 REVENUE

Operating activities Sale of goods Interest received on deposits Income – government assistance Other	2011 A$ 000 2010 A$ 000 6,021 6,235 57 50 - 430 - 15
	6,078 6,730

3 FINANCIAL RESULTS

The group recorded a lower net loss of A$851,501 for the year ended 30 June 2011 compared to a net loss of A$1,540,000 for the year ended 30 June 2010.

The improvement was mainly attributed to :-

	A$ 000
- The write down of intangible asset in 2010	(920)
- Staff cost saving in Australia Operation	(200)
- Increased in Advertising & Promotion	350

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4 RECONCILIATION OF CASH FLOW FROM OPERATIONS WITH PROFIT / (LOSS) AFTER INCOME TAX

Reconciliation of loss for the year to net cash usedinoperating activities :	2011	2010
	A$ 000	A$ 000
NetLoss	(803)	(1,573)
Adjustmentsfor non-cash items :
Depreciation	247	255
Impairment of intangible asset	-	920
Exchange different ontranslationof foreignoperations	189	-
(Increase)/decreaseinassets :
Receivables	248	(296)
Inventories	255	(591)
Other Assets	-	33
Increase/(decrease)in liabilities :
Trade and othercreditors	(215)	(729)
Net cash(usedin) operating activities	(79)	(1,981)

5 DISCONTINUED OPERATIONS

There were no entities over which control was gained or lost during the year.

6 DETAILS OF INDIVIDUAL AND TOTAL DIVIDENDS AND DIVIDEND PAYMENTS

• Date the final dividend is payable N/A

Record date to determine entitlements to the dividend N/A Has the dividend been declared N/A

Other disclosures in relation to dividends

The Directors have not declared a dividend and no dividends have been paid during the year.

7 NET ASSET BACKING

NET ASSET BACKING
	2011	2010
	Cents per	Cents per
	share	share
Net tangible assets per share	3.146	3,568

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8 CONTINGENT LIABILITY

There are no known contingent liabilities.

9 SEGMENT REPORTING

The Malaysian business is the only business producing significant revenue, and as such, it currently represents the group’s sole reportable segment. The directors are of the opinion that the statement of comprehensive income of Holista CollTech Ltd’s group is equivalent to the operating segment identified above and as such no further disclosure is being provided.

10 ISSUED AND QUOTED SECURITIES AT END OF CURRENT PERIOD

Category of securities Total number Number quoted Ordinary securities 129,603,281 129,603,281 11 EARNINGS PER SHARE (EPS) 2011 Reconciliation of earnings to profit or loss Profit /(loss) (803,582) Earnings used to calculate basic EPS (803,582) Earnings used in the calculation of dilutive EPS (803,582) No. of shares Weighted average number of ordinary shares outstanding during the year used in calculating basic EPS 129,603,281 Weighted average number of ordinary shares outstanding during the year used in calculating dilutive EPS 129,603,281	2010 (1,572,895)
	(1,572,895)
	(1,572,895)
	No. of shares 120,602,915
	120,602,915

12 CONTROL OVER ENTITIES WHICH HAS BEEN GAINED OR LOST DURING THE YEAR

The Company has no entities which has been gained or lost during the year .

13 ASSOCIATES AND JOINT VENTURES

	Name of Company		Place of incorporation		Effective Interest (%)		Principal activity
	ClickCapTechSdn Bhd		Malaysia		50		Dormant
	Equinox HerbalsLimited		India		40		Dormant

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14 OTHER SIGNIFICANT INFORMATION

The Company does not have other significant information.

15 FOREIGN ENTITIES

The Company is an Australian entity and reports under Australian accounting standards.

16 AUDIT DISPUTES AND QUALIFICATIONS

There are no known audit disputes or qualifications.

17 STATEMENTS IN RELATION TO ACCOUNTS AND AUDIT

This report is based on accounts to which one of the following applies.

 The accounts have been audited  The accounts have been subject (refer audit attached report). to review (refer attached review report).  The accounts are in the process  The accounts have not yet been of being audited or subject to audited or reviewed. review.

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Sign here: ............................................... Date: ...30 August 2011 (Company Secretary)

Print name: Ben Donovan

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