IMUGENE LIMITED — Annual Report 2007

Aug 29, 2007

Appendix 4E Preliminary final report Year ended 30 June 2007

Rule 4.3A

Appendix 4E

Preliminary final report Year ended 30 June 2007

Name of entity

Imugene Limited

ABN 99 009 179 551	Financialyear ended (“currentyear”)
	30 June 2007
	Comparativeyear ended(“prioryear”)
	30 June 2006

Statement

This report is based on information extracted from the Annual Financial Report of Imugene Limited (Company) and the entities it controlled at the end of, or during the year ended 30 June 2007 (Consolidated Entity or Group) which is currently in the process of being audited.

Results for announcement to the market

	UP/DOWN	CHANGE $’000	% CHANGE
Revenues from ordinary activities	DOWN	(98)	(37%)
Revenue for the year has decreased due to a reduction in interest income.
Loss from ordinary activities after tax attributable to members.	UP	117	5%
Loss for the year is higher primarily due to higher research and development spend.
Net loss for the period attributable to members	UP	117	5%
No dividends have been paid during or are proposed in respect of the financial year ended 30 June 2007.

Appendix 4E Page 1

Appendix 4E Preliminary final report Year ended 30 June 2007

Appendix 4E – Contents and checklist of requirements

For the year ended 30 June 2007

1.	Reporting period and the previous corresponding period.	Refer Page 1 of this Appendix 4E.
2.	Results for announcement to the market.	Refer Page 1 of this Appendix 4E.
3.	Statement of financial performance with notes to the	Refer Page 3 of this Appendix 4E.
	statement.
4.	Statement of financial position with notes to the statement.	Refer Page 5 of this Appendix 4E.
5.	Statement of cash flows with notes to the statement.	Refer Page 7 of this Appendix 4E.
6.	Details of individual and total dividends or distributions and	No dividends or other distributions have
	dividend or distribution payments.	been paid during or are proposed in
		respect of the financial year ended 30
		June 2007.
7.	Details of dividend or distribution reinvestment plans in	No dividends or other distributions plans
	operation and the last date for the receipt of an election	are in operation in respect of the financial
	notice for participation in any dividend or distribution	year ended 30 June 2007.
	reinvestment plan.
8.	Statement of retained earnings.	Refer Page 8 of this Appendix 4E.
9.	Net tangible assets per security.	Refer Page 8 of this Appendix 4E.
10.	Details of entities over which control has been gained or	Not applicable.
	lost during the period.
11.	Details of joint venture entities and associated entities.	The Company has no material
		associated or joint venture entities.
12.	Any other significant information needed by an investor to	Not applicable.
	make an informed assessment of the entity’s financial
	performance and financial position
13.	Accounting standards used in compiling reports by foreign	Not applicable.
	entities (e.g. International Accounting Standards).
14.	A commentary on the results for the period.	Refer Page 4 of this Appendix 4E
15.	A statement as to whether the report is based on accounts	Refer Page 1 of this Appendix 4E. This
	which have been audited or subject to review, are in the	report is based on accounts which are in
	process of being audited or reviewed, or have not yet been	the process of being audited.
	audited or reviewed.
16.	If the accounts have not yet been audited or subject to	Not applicable.
	review and are likely to be subject to dispute or
	qualification, a description of the likely dispute or
	qualification.
17.	If the accounts have been audited or subject to review and	Not applicable.
	are subject to dispute or qualification, a description of the
	dispute or qualification

Appendix 4E Page 2

Appendix 4E Preliminary final report Year ended 30 June 2007

Income Statement

For the year ended 30 June 2007

Revenue from continuing operations Other income Research and development Business development Commercialisation expenses Corporate and administration costs Loss from ordinary activities before income tax expense Income tax benefit Net loss attributable to members of Company Earnings / (loss) per share Basic loss per share (cents per share) Diluted loss per share (cents per share)	Consolidated 2007 2006 $ $ 165,534 263,251 310,723 103,083 (1,077,187) (845,017) (303,209) (246,515) (936,819) (1,145,962) (720,351) (568,119) (2,561,309) (2,439,279) 257,046 252,060 (2,304,263) (2,187,219) (1.8) (1.7) (1.8) (1.7)	Consolidated 2007 2006 $ $ 165,534 263,251 310,723 103,083 (1,077,187) (845,017) (303,209) (246,515) (936,819) (1,145,962) (720,351) (568,119) (2,561,309) (2,439,279) 257,046 252,060 (2,304,263) (2,187,219) (1.8) (1.7) (1.8) (1.7)
		(2,439,279)
		252,060
		(2,187,219)
		(1.7) (1.7)

The above Income Statement is an extract from the full Financial Report which is in the process of being audited.

Notes to the Income Statement

For the year ended 30 June 2007 Revenue from continuing operations Sub-license fees Interest Other income Government grants Net foreign exchange gains Other Expenses Depreciation Commercialisation expenses Patent expenses Employee expenses Amortisation of intangibles	Consolidated 2007 2006 $ $ 63,841 66,690 101,693 196,561 165,534 263,251 309,151 100,662 - 2,421 1,572 - 310,723 103,083 4,565 5,508 178,107 490,441 417,572 314,381 341,140 341,140	Consolidated 2007 2006 $ $ 63,841 66,690 101,693 196,561 165,534 263,251 309,151 100,662 - 2,421 1,572 - 310,723 103,083 4,565 5,508 178,107 490,441 417,572 314,381 341,140 341,140
		263,251
		100,662 2,421 -
		103,083
		5,508 490,441 314,381 341,140

Appendix 4E Page 3

Appendix 4E Preliminary final report Year ended 30 June 2007

Commentary on results

For the year ended 30 June 2007

Trends in revenue from continuing operations

Current year revenues are $97,717 lower than 2006, a decrease of 37%. The decrease is primarily due to a reduction in interest income due to a lower average cash balance throughout the current year.

Trends in other revenue

Other revenues are $207,640 higher than 2006, an increase of 201%. This increase is primarily due to the award of a new Commercial Ready grant from AusIndustry during the current year.

Other Significant Features of Operating Performance

Research and development spend has increased by $232,170 (27%) in comparison to last year as the Company continues to strengthen its research and development projects in the USA.

Included within expenses for the year to 30 June 2007 are non-cash share-based payment expenses of $541,700 (2006: credit of $3,060) recognised in accordance with Accounting Standards in respect of 4,350,000 incentive options granted to executives of the Company. The grant of these options was announced on 14 December 2006 and subsequently approved by shareholders at a general meeting held on 18 January 2007.

Appendix 4E Page 4

Appendix 4E Preliminary final report Year ended 30 June 2007

Balance Sheet

As at 30 June 2007

Note Current assets Cash and cash equivalents Trade and other receivables Tax assets (a) Total current assets Non-current assets Property, plant and equipment Intangible assets (b) Total non-current assets Total assets Current liabilities Trade and other payables (c) Provisions Total liabilities Net assets Equity Contributed equity Reserves Accumulated losses Total equity	Consolidated 2007 2006 $ $ 1,099,226 2,697,244 1,226 41,442 525,460 542,062 1,625,912 3,280,748 10,151 22,228 3,624,305 3,965,445 3,634,456 3,987,673 5,260,368 7,268,421 472,618 732,603 87,932 73,437 560,550 806,040 4,699,818 6,462,381 13,180,042 13,180,042 806,245 264,545 (9,286,469) (6,982,206) 4,699,818 6,462,381	Consolidated 2007 2006 $ $ 1,099,226 2,697,244 1,226 41,442 525,460 542,062 1,625,912 3,280,748 10,151 22,228 3,624,305 3,965,445 3,634,456 3,987,673 5,260,368 7,268,421 472,618 732,603 87,932 73,437 560,550 806,040 4,699,818 6,462,381 13,180,042 13,180,042 806,245 264,545 (9,286,469) (6,982,206) 4,699,818 6,462,381
		3,280,748
		22,228 3,965,445
		3,987,673
		7,268,421
		732,603 73,437
		806,040
		6,462,381
		13,180,042 264,545 (6,982,206)
		6,462,381

The above Balance Sheet is an extract from the full Financial Report which is in the process of being audited.

Appendix 4E Page 5

Appendix 4E Preliminary final report Year ended 30 June 2007

Notes to the Balance Sheet

For the year ended 30 June 2007 (a) – Tax assets Research & development tax concession receivable (b) – Intangible assets Patents, licences and other rights Opening cost Closing cost Accumulated amortisation at the start of the year Amortisation charge Accumulated amortisation at the end of the year Opening net book amount Closing net book amount (c) – Trade & other payables Trade & other payables Trade payables Deferred Income Other payables	Consolidated 2007 2006 $ $ 525,460 542,062 5,117,095 5,117,095 5,117,095 5,117,095 (1,151,650) (810,510) (341,140) (341,140) (1,492,790) (1,151,650) 3,965,445 4,306,585 3,624,305 3,965,445 419,045 688,654 30,343 - 23,230 43,949 472,618 732,603	Consolidated 2007 2006 $ $ 525,460 542,062 5,117,095 5,117,095 5,117,095 5,117,095 (1,151,650) (810,510) (341,140) (341,140) (1,492,790) (1,151,650) 3,965,445 4,306,585 3,624,305 3,965,445 419,045 688,654 30,343 - 23,230 43,949 472,618 732,603
		5,117,095
		(810,510) (341,140)
		(1,151,650)
		4,306,585
		3,965,445
		688,654 - 43,949
		732,603

Appendix 4E Page 6

Appendix 4E Preliminary final report Year ended 30 June 2007

Cash Flow Statement

For the year ended 30 June 2007

Note Cash flows from operating activities Receipts from customers Payments to suppliers and employees Income tax repayments received Other revenue Net cash outflow from operating activities (a) Cash flows from investing activities Payments for property, plant and equipment Interest received Net cash inflow (outflow) from investing activities Cash flows from financing activities Net cash inflow from financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the half year Cash and cash equivalents at the end of the year	Consolidated 2007 2006 $ $ 65,413 66,690 (2,381,408) (2,000,489) 273,648 - 339,494 100,662 (1,702,853) (1,833,137) - (12,627) 104,835 196,561 104,835 183,934 - - (1,598,018) (1,649,203) 2,697,244 4,346,447 1,099,226 2,697,244	Consolidated 2007 2006 $ $ 65,413 66,690 (2,381,408) (2,000,489) 273,648 - 339,494 100,662 (1,702,853) (1,833,137) - (12,627) 104,835 196,561 104,835 183,934 - - (1,598,018) (1,649,203) 2,697,244 4,346,447 1,099,226 2,697,244
		(1,833,137)
		(12,627) 196,561
		183,934
		-
		(1,649,203) 4,346,447
		2,697,244

The above Cash Flow Statement is an extract from the full Financial Report which is in the process of being audited.

Notes to the Cash Flow Statement

For the year ended 30 June 2007

(a) – Reconciliation of loss after income tax to net cash outflow from operating activities Loss for the year Depreciation and amortization Share based payment Interest income Provision for employee benefits (increase) / decrease in working capital Net cash outflow from operating activities	Consolidated 2007 2006 $ $ (2,304,263) (2,187,219) 341,140 346,648 541,700 (3,060) (101,693) (196,561) 14,495 24,544 (194,232) 182,511 (1,702,853) (1,833,137)	Consolidated 2007 2006 $ $ (2,304,263) (2,187,219) 341,140 346,648 541,700 (3,060) (101,693) (196,561) 14,495 24,544 (194,232) 182,511 (1,702,853) (1,833,137)
		(1,833,137)

Appendix 4E Page 7

Appendix 4E Preliminary final report Year ended 30 June 2007

Statement of Changes in Equity

For the year ended 30 June 2007

Share Capital At the beginning of the year At the end of the year Share Based Payment Reserve At the beginning of the year Employee share options granted At the end of the year Accumulated losses At the beginning of the year Loss for the year At the end of the year Total Equity At the beginning of the year At the end of the year	Consolidated 2007 2006 $ $ 13,180,042 13,180,042 13,180,042 13,180,042 264,545 267,605 541,700 (3,060) 806,245 264,545 (6,982,206) (4,794,987) (2,304,263) (2,187,219) (9,286,469) (6,982,206) 6,462,381 8,652,660 4,699,818 6,462,381	Consolidated 2007 2006 $ $ 13,180,042 13,180,042 13,180,042 13,180,042 264,545 267,605 541,700 (3,060) 806,245 264,545 (6,982,206) (4,794,987) (2,304,263) (2,187,219) (9,286,469) (6,982,206) 6,462,381 8,652,660 4,699,818 6,462,381
		13,180,042
		267,605 (3,060)
		264,545
		(4,794,987) (2,187,219)
		(6,982,206)
		8,652,660 6,462,381

The above Statement of Changes in Equity is an extract from the full Financial Report which is in the process of being audited.

Net Tangible Assets per Security

As at 30 June 2007

Net tangible assets per ordinary share

Consolidated
2007	2006
¢	¢
0.82	1.91

Appendix 4E Page 8

Appendix 4E Preliminary final report Year ended 30 June 2007

Analyses and Discussion

For the year ended 30 June 2007

Balance sheet / Cash flow statement

Net cash burn rate per month for the financial year ended 30 June 2007 equated to $133,000 per month, a similar cash burn rate to the 2006 year.

The Company year end cash balance was on budget at $1.1m. Subsequent to year-end (in July 2007) Imugene received $417,000 from the ATO (2006 Income tax rebate) and Commercial Ready Grant contributions.

The Company’s budgeted net cash outflow for the coming year is expected to be funded from one or more sources of additional cash, including the exercise of options, existing and potential new grants, licence fees from existing and potential new licences and possible income from collaboration with industry partners.

Appendix 4E Page 9