SINGULAR HEALTH GROUP LTD — Annual Report 2021

Aug 30, 2021

SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

SINGULAR HEALTH GROUP LIMITED ACN 639 242 765

APPENDIX 4E GIVEN TO THE ASX UNDER LISTING RULE 4.3A

Reporting Period

Financialyear end	30 June 2021
Previous correspondingreporting period	30 June 2020

Results for Announcement to Market

	30 June 2021 $	30 June 2020 $	% increase/ (decrease) over corresponding period
Revenue from ordinaryactivities	193,643	105,922	82.8%
Profit/(Loss) after tax from ordinary activities attributable to members	(4,456,097)	(707,588)	529.8%
Net profit/(loss) for the period attributable to members	(4,451,047)	(707,588)	529.0%

Dividends

No dividends have been declared or paid during the year ended 30 June 2021. The Directors do not recommend the payment of a dividend in respect of the year ended 30 June 2021.

The Company does not have any dividend reinvestment plan in operation.

Explanation of Results

During the period the Company has been focused on advancing its key technologies, and also completed its IPO on the ASX Limited (please refer Prospectus dated 9 December 2020 for further details on the IPO).

Subsequent to the IPO the Company entered into agreements to acquire Virtual Surgical Planning software and to invest AUD$300,000 for 25% equity stake in Australian Additive Engineering Pty Ltd (AAE), secured a fifty (50) License sale of integrated MedVR and Virtual Surgical Planning software with Lyka Smith, a leading medical computer aided design company, launched the Scan to Surgery[TM] initiative with long-term strategy to develop end-to-end patient-specific surgical planning software and bespoke 3D printed implants and guides, successfully concluded an AI-driven spinal segmentation project with the CSIRO, released the Medical File Transfer Protocol (MFTP) to act as main backbone for Scan to Surgery[TM] and enable future transfer of medical/design files between mobile devices, and launched a mobile 3D scan App for improved patient communication.

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

Explanation of Results (continued)

Non-cash share based payments to employees and consultants during the period were approximately $720,324. These equity incentives are designed to ensure employee interests were closely aligned with the achievement of the Group’s operational and financial targets and also to reduce cash payments as part of the Group’s commitment to reduce cash overheads. Another significant non-cash expenditure item was the finance costs relating to the fair value adjustment on the convertible notes for the financial year of approximately $1.4 million. All convertible loans were settled and converted to equity in the current financial year.

The Group reported a net loss attributable to members for the period of approximately $4.451 million.

Net Tangible Assets per Security

Net Tangible Asset/(Liabilities) per share	30 June 2021	30 June 2020
Net tangible assets/(liabilities) (cents per share)	4.24	0.85

Controlled entities

The Company did not gain or lose control over any entities during the financial year. The Company’s controlled entities as at 30 June 2021 are outlined below.

	Country of	Date of incorporation /
Controlled entities	Incorporation	acquisition
Singular Health Group Pte. Ltd.	Singapore	12 September 2019
Singular Health PtyLtd	Australia	18 September 2019

The Group acquired an interest in associates during the year. Refer to Note 12 of the attaching Financial Report to this Appendix 4E for further details.

Audit

This Appendix 4E is based on the financial report for year ended 30 June 2021, which is in the process of being audited.

Attachments

The Preliminary Final Report of Singular Health Group Limited for the year ended 30 June 2021 is attached.

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

For the year ended 30 June 2021

Note	2021 $ 2020 $
Revenue 3 Government grant income 3 Interest and other revenue 3 Selling and marketing expenses Patent, research and development expenses Consultancy and subcontractor fees Employee and director benefits expenses Accountancy, audit and legal expenses Depreciation and amortisation Administration expenses Share based payments expense 4 Finance costs Share of net loss in associates Other expenses Loss before income tax Income tax benefit/(expense) Loss after tax for the period attributable to the members of Singular Health Group Limited Other comprehensive income Items that will be reclassified subsequently to profit or loss when specific conditions are met: Exchange differences on translating foreign operations, net of tax Total comprehensive (loss) for the period attributable to the members of Singular Health Group Limited Basic and diluted loss per share (cents per share) for the year attributed to the members of Singular Health Group Limited 5	193,643 105,922 262,700 24,000 117,354 66 (149,366) (9,318) (189,768) (3,399) (801,539) (326,623) (878,645) (222,258) (370,565) (48,153) (130,691) (29,171) (249,310) (138,363) (720,234) - (1,464,382) (55,423) (4,136) - (71,158) (4,869)
	(4,456,097) (707,588) - -
	(4,456,097) (707,588) 5,050 -
	(4,451,047) (707,588)
	(6.02) (4.74)

The above Consolidated Statement of Profit or Loss and Other Comprehensive Income is to be read in conjunction with the accompanying notes.

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 30 June 2021

CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 30 June 2021
Note	2021 $ 2020 $
ASSETS Current Assets Cash and cash equivalents 6 Trade and other receivables Prepayments Prepaid Interest on Convertible Notes Total Current Assets Non-Current Assets Intangibles 7 Plant and equipment 8 Right of use assets Investment in associates 12 Total Non-current Assets TOTAL ASSETS LIABILITIES Current Liabilities Trade and other payables Provisions Borrowings Convertible loans 9 Lease liability Total Current Liabilities Non-current Liabilities Lease Liability Total Non-current Liabilities TOTAL LIABILITIES NET ASSETS/(LIABILITIES) EQUITY Issued capital 10 Reserves 11 Accumulated losses TOTAL EQUITY	4,135,691 130,552 152,119 70,391 9,181 - - 240,390
	4,296,991 441,333
	637,893 199,245 63,358 27,691 133,265 - 295,864 -
	1,130,380 226,936
	5,427,371 668,269
	148,328 129,797 49,184 6,117 1,545 155,941 - 590,000 61,503 -
	260,560 881,855
	84,541 -
	84,541 -
	345,101 881,855
	5,082,270 (213,586)
	9,526,669 500,000 719,286 (5,998) (5,163,685) (707,588)
	5,082,270 (213,586)

The Consolidated Statement of Financial Position is to be read in conjunction with the accompanying notes.

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 30 June 2021

			Issued Capital Share-based Payment Reserve Accumulated Losses Foreign Currency Translation Reserve Total $ $ $ $ $
	Balance at 1 July 2019 Loss for the year Total other comprehensive income Total comprehensive loss for the year Transaction with owners, directly recorded in equity: Issue of Ordinary Shares, net of transaction costs Total transactions with owners Balance at 30 June 2020		- - - - - - - (707,588) - (707,588) - - - (5,998) (5,998)
			- - (707,588) (5,998) (713,586) 500,000 - - - 500,000
			500,000 - - - 500,000
			500,000 - (707,588) (5,998) (213,586)
			Issued Capital Share-based Payment Reserve Accumulated Losses Foreign Currency Translation Reserve Total $ $ $ $ $ 500,000 - (707,588) (5,998) (213,586) - - (4,456,097) - (4,456,097) - - - 5,050 5,050 - - (4,456,097) 5,050 (4,451,047) 5,330,592 - - - 5,330,592 2,846,077 - - - 2,846,077 850,000 720,234 - - 1,570,234 9,026,669 720,234 - - 9,746,903 9,526,669 720,234 (5,163,685) (948) 5,082,270
	Balance at 1 July 2020 Loss for the year Total other comprehensive income Total comprehensive loss for the year Transaction with owners, directly recorded in equity: Issue of Ordinary Shares, net of transaction costs Share issued on conversion of Convertible Notes (Note 9,10) Share based payments (Note 4) Total transactions with owners Balance at 30 June 2021

The Consolidated Statement of Changes in Equity is to be read in conjunction with the accompanying notes.

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

CONSOLIDATED STATEMENT OF CASHFLOWS

For the year ended 30 June 2021

Note	2021 $ 2020 $
Cash flows from operating activities Receipts from customers Government grants received Payments to suppliers and employees Interest (paid)/received Net cash flows (used in) operating activities 6 Cash flows from investing activities Purchase of plant & equipment Payments for intangible assets Payments for acquisition of associates Net cash flows (used in) investing activities Cash flows from financing activities Proceeds from issue of shares, net of issue costs Proceeds from issue of convertible notes Proceeds from borrowings Payment of principle portion of lease liabilities Net cash flows from financing activities Net increase in cash and cash equivalents Cash and cash equivalents at beginning year Effects of foreign exchange rates Cash and cash equivalents at end year 6	111,915 32,520 377,810 - (2,399,133) (580,689) 2,244 -
	(1,907,164) (548,169)
	(50,486) (31,603) (260,082) (227,708) (300,000) -
	(610,568) (259,311)
	5,691,655 500,000 1,025,000 295,000 (154,396) 155,692 (44,438) -
	6,517,821 950,692
	4,000,089 143,212 130,552 - 5,050 (12,212)
	4,135,691 130,552

The above Consolidated Statement of Cashflows is to be read in conjunction with the accompanying notes.

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For the year ended 30 June 2021

NOTE 1: BASIS OF PREPARATION OF THE YEAR END FINANCIAL REPORT

The preliminary financial report has been prepared in accordance with ASX listing Rule 4.3A and the disclosure requirements of ASX Appendix 4E.

This report has been prepared in accordance with the Australian Accounting Standards (AASBs) and Interpretations issued by the Australian Accounting Standards Board, and the Corporations Act 2001 . This year end financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this preliminary report is to be read in conjunction with the annual financial report for the year ended 30 June 2020, the interim financial report for the half-year ended 31 December 2020 and any public announcement made by Singular Health Group Limited during the reporting period in accordance with the continuous disclosure requirement of the Corporations Act 2001 .

NOTE 2: SEGMENT REPORTING

Segment information has been prepared in conformity with the accounting policies adopted for preparing and presenting the financial statements of the consolidated Group. The Group’s primary business segment is the provision of Volume Rendering Platform (VRP) software. The Company operates in one segment, medical technology products.

An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same entity), whose operating results are regularly reviewed by the entity’s chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available. This includes start-up operations which are yet to earn revenues.

Management will also consider other factors in determining operating segments such as the existence of a line manager and the level of segment information presented to the board of directors.

Operating segments have been identified based on the information provided to the chief operating decision makers – being the executive management team.

The group aggregates two or more operating segments when they have similar economic characteristics, and the segments are similar in the nature of the minerals targeted. Operating segments that meet the quantitative criteria as prescribed by AASB 8 are reported separately. However, an operating segment that does not meet the quantitative criteria is still reported separately where information about the segment would be useful to users of the financial statements.

Information about other business activities and operating segments that are below the quantitative criteria are combined and disclosed in a separate category for “all other segments”.

The chief operating decision maker has been identified as the Board of Directors.

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

NOTE 3: REVENUE AND OTHER INCOME

OTE 3: REVENUE AND OTHER INCOME
		2021	2020
		$	$
Operating Revenue
Product revenue		193,643	105,922
		193,643	105,922
Other Income
Interest revenue		2,244	66
Research and development grant		262,700	-
ATO Jobkeeper and cashflow boost		113,032	-
Other		2,078
		380,054	66
OTE 4: SHARE BASED PAYMENTS
hare based payments made during the year ended 30 June 2021	are summarised		below:
		2021	2020
		$	$
Options issued to Directors as incentive based remuneration		361,868		-
Options issued to other key management personnel and consultant as incentive based remuneration		87,548		-
Performance Rights issued to Directors as incentive and for services to be provided		154,366		-
Performance Rights issued to key management personnel and consultant as incentive and for services		116,452		-
Total share based payment expense		**720,234 **		-
NOTE 5: EARNINGS PER SHARE		2021	2020
Basic and diluted loss per share (cents per share)		(6.02)	(4.74)
Weighted average number of ordinary shares outstanding during the period used in the calculation of basic EPS	74,053,220		14,917,808

NOTE 4: SHARE BASED PAYMENTS

Share based payments made during the year ended 30 June 2021 are summarised below :

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

NOTE 6: CASH AND CASH EQUIVALENTS

Cash at Bank Total cash and cash equivalents Reconciliation to Statement of Cashflows Loss for the year Non-cash items Share-based payments Depreciation and amortisation Convertible note interest Director loan interest Share of net loss in associates Changes in Assets and Liabilities Increase/(Decrease) in Trade and Other Payables (Increase)/Decrease in Trade and Other Receivables Increase)/(Decrease) in Provisions Cash flows used in operations

2021 2020 $ $ 4,135,691 130,552 4,135,691 130,552 2021 $ 2020 $ (4,456,097) (705,558) 720,234 - 130,691 32,395 1,471,464 54,610 - 6,911 4,136 - 29,860 133,884 149,481 (70,411) 43,067 -

(1,907,164) (548,169)

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

NOTE 7: INTANGIBLES

Intellectual Property at cost Less: Accumulated amortisation and impairment a) Reconciliation of movements in intangible assets Intangible Assets Balance at 1 July 2019 Additions Impairment expense Amortisation expense Balance at 30 June 2020 Balance at 1 July 2020 Additions Impairment expense Amortisation expense Balance at 30 June 2021 NOTE 8: PROPERTY, PLANT AND EQUIPMENT Office equipment – at cost Less: Accumulated depreciation Computer equipment – at cost Less: Accumulated depreciation Total property, plant and equipment a) Reconciliation of movements in fixed assets Property, Plant and Equipment Balance at 1 July 2019 Additions Depreciation expense Balance at 30 June 2020 Additions Depreciation expense Balance at 30 June 2021			2021 2020 $ $ 737,790 227,708 (99,897) (28,463) 637,893 199,245 $ - 227,708 - (28,463) 199,245 199,245 510,082 - (71,434) 637,893 2021 2020 $ $ 41,482 31,623 (15,679) (3,932) 40,628 - (3,073) -
			63,358 27,691
			$ - 31,623 (3,932) 27,691 50,486 (14,819) 63,358

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

NOTE 9: CONVERTIBLE LOANS

Balance brought forward Convertible notes issued during the year1 Less: Convertible notes repaid during the year2 Balance as at 30 June 2021	2021 2020 $ $ 590,000 - 2,110,000 590,000 (2,700,000) - - 590,000

• (1) The terms of the various convertible notes are as follows:

Conversion Period	Aperiod of 22 months commencingfrom the date of issue
Conversion Event	The day Singular Health Group shares are listed on the Australian Stock Exchange ("ASX")
Conversion Price	The convertible notes are converted at a discount of 50% of the price the shares are listed on ASX (ie 50% of $0.20 IPO price). On that basis, the Convertible Notes have been recorder at their 'fair value' with the associated adjustment being recognised as interest.
Interest	Interest accrues on the Convertible Notes at a rate of 10% per annum. Prepaid Interest of $1,440,144 resulting from fair value adjustment was recognised which was amortised to profit or loss as financing costs over the period from the date the notes were issued to the date of SHG's listing on ASX.

• (2) As part of the IPO completed in February 2021, all convertible loans on issue including interest accrued converted into fully paid ordinary shares. Refer to Note 10 Issued Capital for further details.

NOTE 10: ISSUED CAPITAL

OTE 10: ISSUED CAPITAL
Issued Ordinary Shares - no par value (fully paid) Total Opening balance – 1 July 2019 Closing balance – 30 June 2020 IPO Placement Shares Share issued upon conversion of Existing Convertible Notes Shares issued to Lead Manager and Advisor Cleansing Offer as part of Prospectus Share issued for VR Surgical acquisition (see Note 12) Costs of shares issued Closing Balance – 30 June 2021	2021 2020 Number of Shares Number of Shares 102,798,867 55,000,001 102,798,867 55,000,001
	Number of Shares Value $ - - 55,000,001 500,000 30,000,000 6,000,000 14,230,384 2,846,077 3,000,000 600,000 - - 568,482 250,000 (669,408) 102,798,867 9,526,669

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SINGULAR HEALTH GROUP LIMITED APPENDIX 4E

NOTE 11: RESERVES

Nature and Purpose of Reserve

The share based payment reserve records the value of options, performance rights and performance shares issued to the Group’s directors, employees, and third parties. The value of the amount disclosed during the year reflects the value of options and performance shares issued by the Group.

Performance Rights Options Foreign Currency Translation Reserve Total Reserves	2021 2020 $ $ 270,818 - 449,416 - (948) (5,988)
	719,286 (5,988)

NOTE 12: ASSET ACQUISITION

a. VR Surgical software acquisition

On 26 May 2021, the Company acquired virtual surgical planning software developed by VR Surgical Pty Ltd ( VR Surgical) which is a software that allow surgeons to manipulate standard computer aided design (CAD) files to accelerate the pre-operative planning of maxillofacial surgery in virtual reality. The acquisition was approved by the shareholders at the General Meeting held on 11 May 2021.

In consideration for this acquisition, SHG paid $250,000 in cash and $250,000 worth of issued ordinary shares each to VR Surgical. The fair value of consideration issued on 27 May 2021 which was by reference to the 30-day VWAP of $0.43976 with the total number of shares issued being 568,482. Refer note 10.

The transaction is treated as an asset acquisition as the acquired assets being the software does not meet the definition of 'business' under IFRS 3. The software was recognised as an addition to the Group’s Intangibles to be over amortised over 4 years. Refer Note 7.

b. Investment in Australian Additive Engineering Pty Ltd

On 21 March 2021, the Company and Australian Additive Engineering Pty Ltd (AAE) entered into share subscription deed where SHG will subscribe to 25% of AAE's share capital for a subscription price of $300,000. The acquisition was approved by the shareholders at the General Meeting held on 11 May 2021.

Consideration of $300,000 in cash was paid on 26 May 2021 and this is deemed to be the date of acquisition.

Under AASB 128 Investments in associates and joint ventures , SHG's 25% interest in AAE is considered a significant influence as it holds more than 20% directly in the investee and therefore, the investment is equity accounted upon consolidation.

For the year ending 30 June 2021, Singular recognised a share of net loss in associates of $4,136 in the Group’s Profit or Loss.

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