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SKIN ELEMENTS LIMITED Annual Report 2021

Aug 30, 2021

65803_rns_2021-08-30_a8ab416f-2318-416c-a48e-8f491082d979.pdf

Annual Report

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SKIN ELEMENTS LIMITED A B N 9 0 6 0 8 0 4 7 7 9 4 and its controlled entities APPENDIX 4E Preliminary Final Report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES ABN 90 608 047 794

Corporate directory

Current Directors Peter Malone Executive Chairman Phil Giglia Non-Executive Director Lee Christensen Non-Executive Director

Company Secretary

Phil Giglia

Registered Office

Share Registry

Street: 1242 Hay Street Link Market Services Limited WEST PERTH WA 6005 Street: Level 12, QV1 Building, 250 St Georges Terrace Postal: 1242 Hay Street PERTH WA 6000 WEST PERTH WA 6005 Telephone: 1300 554 474 (within Australia) Telephone: +61 (0)8 6311 1900 +61 1300 554 474 (International) Facsimile: +61 (0)8 6311 1999 Facsimile: +61 (0)8 6370 4203 Email: [email protected] Email: [email protected] Website: www.skinelementslimited.com Website: www.linkmarketservices.com.au

Auditors

BDO Audit (WA) Pty Ltd 38 Station Street SUBIACO WA 6008

Securities Exchange

Australian Securities Exchange Level 40, Central Park, 152-158 St Georges Terrace Perth WA 6000 Telephone: 131 ASX (131 279) (within Australia) Telephone: +61 (0)2 9338 0000 Facsimile: +61 (0)2 9227 0885 Website: www.asx.com.au ASX Code SKN

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Page i

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES ABN 90 608 047 794

Contents

◼ Company Update...................................................................................................................................................................1
◼ Results for announcement to the Market.............................................................................................................................4
◼ Consolidated statement of profit or loss and other comprehensive income........................................................................7
◼ Consolidated statement of financial position.......................................................................................................................8
◼ Consolidated statement of changes in equity.......................................................................................................................9
◼ Consolidated statement of cash flows.................................................................................................................................10
◼ Notes to the Appendix 4E preliminary final report..............................................................................................................11

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Page ii

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES ABN 90 608 047 794

Company Update

1. Operating and financial review

  • 1.1. Nature of Operations and Principal Activities

Skin Elements Limited is a developer, manufacturer, distributor, and retailer of its leading proprietary all-natural skincare SE Formula[TM] . The SE Formula[TM] includes the Soleo Organics natural sunscreen brand, the PapayaActivs therapeutic skincare range, Elizabeth Jane Natural Cosmetics, and the recently developed Invisi-Shield® new generation natural sanitiser range.

  • 1.2. Operations Review

  • a. Invisi Shield SuprCuvr Hospital Grade Disinfectant

Since launching Invisi Shield SuprCuvr, a plant based, anti-microbial disinfectant designed to deliver superior protection against viruses and bacteria, SKN has continued to investigate the use of the SE Formula[TM] in a range of applications for Invisi Shield SuprCuvr as a hospital grade disinfectant.

Invis Shield SuprCuvr (AUST-L 373328) has been registered with the Therapeutic Goods Administration (TGA) as a hospital grade hard surface disinfectant that is 99.99999% (7-log) effective against COVID-19 & bacteria. Invisi Shield SuprCuvr is 100% plant based and is certified as an input for organic production by National Association for Sustainable Agriculture Australia (NASAA) Organic and Biodynamic Standard (NOS).

Successful TGA registration will now allow the Company to make more detailed and specific product and label claims in respect to Invisi Shield SuprCuvr which has the potential to open up significant new commercial scale sales and distribution opportunities for Invisi Shield SuprCuvr.

  • b. SKN Enters into $20m equity funding facility with LDA Capital

SKN has entered into a Put Option Agreement (POA) with US based institutional investment group LDA Capital Limited and LDA Capital LLC (LDA Capital) under which LDA Capital has agreed to provide SKN with up to $20 million in committed equity capital over the next 36 months.

SKN has issued 26,000,000 unlisted fee options and 27,500,000 collateral shares for nil consideration which are held by LDA Capital until such time as SKN issues a call notice to LDA Capital. As at the report date SKN has not yet issued a call notice or received capital funds under the POA.

The agreement allows Skin Elements to access committed equity capital on a flexible basis by managing the timing and size of each capital drawdown. The agreement ensures that the Company has ready access to additional equity capital as required to support its growth into new markets, support existing sales channels, and fund commercial scale sales and distribution opportunities for Invisi Shield SuprCuvr and the Company’s other product lines.

  • c. SKN receives R&D Rebate

With focus on continued development and testing of its natural anti-microbial technologies, SKN obtained R&D Registration approval from AusIndustry for 2021, and received a R&D Tax Rebate of $988,711 in August 2021.

  • d. SKN relocates to new Head Office at 1242 Hay Street West Perth

SKN has relocated to a new Head Office at 1242 Hay Street, West Perth, Western Australia. This new leased premises provides for sufficient space for Skin Elements’ corporate, product development, and sales & marketing operations including a retail shop front.

  • e. SKN appoints new Director

SKN has appointed Mr Lee Christensen to the Board as a Non-Executive Director. Mr Christensen’s appointment brings broad experience and skills to the Board, assisting the Company to develop its corporate strategy and governance as it transitions from research & development to commercial operations.

Mr Christensen’s appointment follows the resignation of Mr John Poulsen as a Non-Executive Director. Mr Poulsen had been appointed earlier in the year following the resignation of Mr Craig Piercy as an Executive Director.

  • f. SKN enters into Distribution Agreement for Invisi Shield

SKN entered into a binding Distribution Agreement with Prudential Consultants Pty Ltd (Prudential Consultants) for the distribution of its Invisi Shield® in Australia. Prudential Consultants has agreed to minimum sales commitments of $2.4 million over three years for the exclusive distribution of Invisi Shield® in New South Wales and Tasmania, and the distribution of Invisi Shield® outside of these territories on a non-exclusive basis. Prudential Consultants has commenced marketing activities for Invisi Shield SuprCuvr, with orders under the Distribution Agreement expected to commence now that TGA registration has been obtained.

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Page 1

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES ABN 90 608 047 794

Company Update

  • g. Global Opportunity

Skin Elements continues to maintain its focus on developing sales of all of its natural products range in Australia and global markets including major retail pharmacy and health chains in the United Kingdom, the expansion of its online sales portal, and the support to its distributors in Europe.

  • h. Manufacturing Underway

Skin Elements continues to use approved contract production laboratories in Australia to produce its SE Formula product ranges in accordance with Good Manufacturing Practices and TGA requirements. Notwithstanding that these manufacturers have production capacity to meet the Company’s requirements for the foreseeable future, the restrictions caused by COVID-19 have delayed production and the delivery of inventories from its contract manufacturers.

  • i. Funding of Growth Strategies

The Company continually reviews its financial position to ensure that it has sufficient working capital to undertake its growth programs. During the period to the date of this report Skin Elements:

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  • Raised $120,000 cash in August 2020 through placement of 2,000,000 ordinary fully paid shares and 200,000 attaching options.

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  • Raised $1,417,737 cash from the exercise into fully paid ordinary shares of 30,981,466 SKNUOA unlisted options and 4,882,930 SKNOA listed options and received a further $632,857 from issue of 6,328,570 short fall shares. Received further $1,200,000 cash from the placement of 12,000,000 ordinary shares to State Securities Pty Ltd as part of the completion of their options underwriting obligations.

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  • Placed 23,000,000 shares in a private placement to sophisticated investors for $1,840,000 cash (before costs). Announced a non-renounceable Entitlement Issue on the basis of one new share for every fifteen shares held by eligible shareholders ta an issue price of $0.08 per share together with one attaching new option for every two new shares to raise approximately $2.023 million (before costs).

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1.3. Financial Review

  • a. Key profit and loss measures
Movement
(increase/
decrease)
Movement
$
2021
2020
$ $
◼ Revenues from ordinary activities
decreased
136,426
◼ Loss from ordinary activities after tax
increased
1,132,289
◼ EBITDA
increased
1,119,675
b. Key net asset measures		 288,741
425,167
(3,042,523)
(1,910,234)
(2,638,615)
(1,518,940)
Movement
(increase/
decrease)
Movement
$
2021
2021
$ $
◼ Cash and cash equivalents
increased
81,685
◼ Working capital_(excluding prepayments)
_increased
1,848,716
◼ Net tangible assets
increased
753,896
◼ Net assets
increased
390,222		 287,632
205,947
2,214,343
365,627
1,312,425
558,529
9,602,575
9,212,353

The financial statements have been prepared on a going concern basis, which contemplates the continuity of normal business activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.

1.4. Impact of Coronavirus ( COVID-19 ) Pandemic

Whilst SKN has continued to operate from West Perth premises during the period, the impact of COVID-19 restrictions has seen delay of orders from national and international distributors, restrictions on travel and reduced ability to meet with distributors and new customers, increased costs and shipment timeframes for national and international freight, and delayed production and the delivery of inventories from its contract manufacturers in Victoria and Queensland.

During the period the Company received the Federal Government’s Jobkeeper subsidy and Cashflow boost incentives of $92,500.

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Page 2

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES ABN 90 608 047 794

Company Update

1.5. Events Subsequent to Reporting Date

There are no other significant after balance date events that are not covered in this Directors' Report or within the financial statements as disclosed.

  • 1.6. Future Developments, Prospects, and Business Strategies

Likely developments in the operations, business strategies and prospects of the Group include:

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  • The Company will undertake future capital raising through a placement, and the consideration of other equity and debt proposals;

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  • The Company will continue to focus on development and commercialisation of its natural skin care technology as set out in its review of operations.

Other likely developments, future prospects and business strategies of the operations of the Group and the expected results of those operations have not been included in this report particularly given the early stage of the Company’s commercial operations with its new expanded range of natural and organic products. The Directors believe that the inclusion of such information would be likely to be unreasonably prejudicial to the Group.

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Page 3

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Results for announcement to the Market for the year ended 30 June 2021

  • 1 REPORTING PERIOD (item 1)
Results for announcement to the Market
for the year ended 30 June 2021		 Results for announcement to the Market
for the year ended 30 June 2021		 Results for announcement to the Market
for the year ended 30 June 2021
1
REPORTING PERIOD(item 1)
◼ Report for the financial year ended:
◼ Previous corresponding period is the year months ended:		 30 June 2021
30 June 2020
2
RESULTS FOR ANNOUNCEMENT TO THE MARKET		 Movement Percentage
Amount
%
$
◼ Decrease in revenues from ordinary activities (item 2.1)
◼ Increase in loss from ordinary activities after tax attributable
to members (item 2.2)
◼ Increase in loss after tax attributable to members (item 2.3)
(32.09)
to
288,741

↑		 59.27
to
(3,042,523)
↑ 59.27
to
(3,042,523)
a.
Dividends(item 2.4)		 Amount per
Franked amount
Security
per security
₵
%
◼ Interim dividend
nil
n/a
◼ Final dividend
nil
n/a
◼ Record date for determining entitlements to the dividend
(item 2.5)
n/a
b.
Brief explanation of any of the figures reported above necessary to enable the figures to be understood(item 2.6):
Refer toOperating and financial review on page 1 of this report.		 nil
n/a
nil
n/a
3 PRELIMINARY FINAL REPORT PRELIMINARY FINAL REPORT
a. Statement of comprehensive income(item 3):
Refer to Consolidated statement of profit or loss and other comprehensive income on page 7
b. Statement of financial position(item 4):
Refer to Consolidated statement of financial position on page 8
c. Statement of cash flows(item 5):
Refer to Consolidated statement of cash flows on page 10
d. Statement of changes in equity(item 6):
Refer to Consolidated statement of changes in equity on page 9
4 DIVIDENDS(item 7)AND RETURNS TO SHAREHOLDERS INCLUDING DISTRIBUTIONS AND BUY BACKS (item 14.2) DIVIDENDS(item 7)AND RETURNS TO SHAREHOLDERS INCLUDING DISTRIBUTIONS AND BUY BACKS (item 14.2)
Nil.
a. Details of dividend or distribution reinvestment plans in operation are described below(item 8):
Not applicable

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Page 4

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES ABN 90 608 047 794

Results for announcement to the Market for the year ended 30 June 2021

Results for announcement to the Market
for the year ended 30 June 2021
5
RATIOS		 Previous
Current
corresponding
period
period
a. Financial Information relating to 5b and 5c:
$
$
Earnings for the period attributable to owners of the parent
(3,042,523)
(1,910,234)
Net assets
9,602,575
9,212,353
Less: Intangible assets (including net deferred tax balances)
(8,290,150)
(8,653,824)
Net tangible assets
1,312,425
558,529
No.
No.
Fully paid ordinary shares
406,977,266
323,284,299
Weighted average number of ordinary shares outstanding during the year used
in calculation of basic EPS
354,508,892
223,746,949
₵
₵
b. Net tangible assets backing per share (cents) (item 9):
0.322
0.173
c. Earnings per share attributable to owners of the parent (cents) (item 14.1):
(0.858)
(0.854)
As at 30 June 2021 the Group has 26,000,000 unissued shares under options (2020: 126,004,034) and 47,000,000 performance
shares on issue (2020: 47,000,000). The Group does not report diluted earnings per share on losses generated by the Group.
During the year, the Group's unissued shares under option and performance shares were anti-dilutive.		 $
$
(3,042,523)
(1,910,234)
9,602,575
9,212,353
(8,290,150)
(8,653,824)
6
DETAILS OF ENTITIES OVER WHICH CONTROL HAS BEEN GAINED OR LOST DURING THE PERIOD:(item 10)
a.
Control gained over entities
◼
Name of entities (item 10.1)
Nil
◼
Date(s) of gain of control (item 10.2)
b.
Loss of control of entities
◼
Name of entities (item 10.1)
Nil
◼
Date(s) of loss of control (item 10.2)
N/A
c. Contribution to consolidated profit (loss) from ordinary activities after
tax by the controlled entities to the date(s) in the current period when
control was gained / lost (item 10.3).
Nil
d. Profit (loss) from ordinary activities after tax of the controlled entities for
the whole of the previous corresponding period (item 10.3)
Nil
7
DETAILS OF ASSOCIATES AND JOINT VENTURE:(item 11)
◼
Name of entities (item 11.1)
Nil
◼
Percentage holding in each of these entities (item 11.2)
n/a
Previous
corresponding
Current period
period
$ $
◼
Aggregate share of profits (losses) of these entities (item 11.3)		 N/A
N/A

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Page 5

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES ABN 90 608 047 794

Results for announcement to the Market

for the year ended 30 June 2021

  • 8 Any other significant information needed by an investor to make an informed assessment of the entity’s financial performance and financial position (item 12): Refer to commentary update accompanying this 4E

  • 9 The financial information provided in the Appendix 4E is based on the preliminary final report (attached), which has been prepared in accordance with Australian Accounting Standards (item 13).

  • 10 A COMMENTARY ON THE RESULTS FOR THE PERIOD (item 14) Refer to Company Update on page 1. The Group had revenue of $288,741 (2020: $425,167) for the period.

  • 11 The preliminary final report has been prepared based on the 30 June 2021 accounts which are in the process of being audited by an independent Audit Firm in accordance with the requirements of s.302 of the Corporations Act 2001 (Cth). (item 15)

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Page 6

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Consolidated statement of profit or loss and other comprehensive income

for the year ended 30 June 2021

Note 2021
2020
$ $
Continuing operations
Revenue
1.1
Cost of sales
Gross profit
Other income
1.2
Administration expenses
2.1
Advertising and marketing expenses
Amortisation
Corporate expenses
2.2
Consultants’ fees
2.3
Occupancy costs
Research and development expenses
Loss before tax
Income tax expense
3.1
Net loss for the year
Other comprehensive income, net of income tax
Other comprehensive income for the period, net of tax
Total comprehensive income attributable to members of the parent entity		 288,741
425,167
(98,302)
(216,270)
190,439
208,897
1,140,003
812,982
(1,093,886)
(740,985)
(206,429)
(192,877)
(403,908)
(391,294)
(414,485)
(320,145)
(206,852)
(277,044)
(88,931)
(123,669)
(1,958,474)
(886,099)
(3,042,523)
(1,910,234)
-
-
(3,042,523)
(1,910,234)
-
-
(3,042,523)
(1,910,234)

(1,518,940)

The consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the accompanying notes.

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Page 7

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Consolidated statement of financial position

as at 30 June 2021

Note 2021
2020
$ $
Current assets
Cash and cash equivalents
4.1
Trade and other receivables
4.2.1
Inventories
5.1
Other current assets
4.3.1
Financial assets
4.4.1
Total current assets
Non-current assets
Right of use asset - property, plant, and equipment
Intangible assets
5.2
Total non-current assets
Total assets
Current liabilities
Trade and other payables
4.5.1
Borrowings
4.6.1
Total current liabilities
Non-current liabilities
Derivative liabilities
4.6.2
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
6.1.1
Reserves
6.4
Accumulated losses
Total equity		 287,632
205,947
1,122,891
764,153
223,225
155,705
72,225
441,865
1,004,000
-
2,709,973
1,567,670
26,648
-
8,290,150
8,653,824
8,316,798
8,653,824
11,026,771
10,221,494
447,998
509,141
30,990
500,000
478,988
1,009,141
945,208
-
945,208
-
1,424,196
1,009,141
9,602,575
9,212,353
-
-
20,978,594
17,607,998
91,252
29,103
(11,467,271)
(8,424,748)
9,602,575
9,212,353

The consolidated statement of financial position is to be read in conjunction with the accompanying notes.

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Page 8

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Consolidated statement of changes in equity

for the year ended 30 June 2021

Note
Balance at 1 July 2019
Loss for the year attributable to the owners of the parent
Adjustment to fair value of convertible note
Other comprehensive income for the year attributable to the
owners of the parent
Total comprehensive income for the year attributable to the
owners of the parent
Transaction with owners, directly in equity		 Convertible
Share-based
Contributed
Accumulated
note
payment
Total
equity
losses
reserve
reserve
equity
$ $ $ $
15,286,784
(6,896,381)
492,405
312,338
9,195,146
-
(1,910,234)
-
-
(1,910,234)
-
42,206
(42,206)
-
-
-
-
-
-
-
-
(1,868,028)
(42,206)
-
(1,910,234)
Shares issued during the year (net of costs)
6.1.1		 1,475,664
-
-
-
1,475,664
Share based payments during the year 195,351
-
-
56,426
251,777
Converting note funds received and conversion
6.1.1		 650,199
-
(450,199)
-
200,000
Transfer to / from reserves: performance shares expired -
222,845
-
(222,845)
-
Transfer to / from reserves: options expired
Balance at 30 June 2020
Balance at 1 July 2020
Loss for the year attributable to the owners of the parent
Adjustment to fair value of convertible note
Other comprehensive income for the year attributable to the
owners of the parent
Total comprehensive income for the year attributable to the
owners of the parent
Transaction with owners, directly in equity
Shares issued during the year (net of costs)
6.1.1
Share based payments during the year
Balance at 30 June 2021		 -
116,816
-
(116,816)
-
17,607,998
(8,424,748)
-
29,103
9,212,353
17,607,998
(8,424,748)
-
29,103
9,212,353
-
(3,042,523)
-
-
(3,042,523)
-
-
-
-
-
-
-
-
-
-
-
(3,042,523)
-
-
(3,042,523)
3,370,596
-
-
-
3,370,596
-
-
-
62,149
62,149
20,978,594
(11,467,271)
-
91,252
9,602,575

The consolidated statement of changes in equity is to be read in conjunction with the accompanying notes.

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Page 9

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Consolidated statement of cash flows

for the year ended 30 June 2021

Note 2021
2020
$ $
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Receipt of Research and development tax incentive
Interest paid
JobKeeper payment scheme and ATO cash flow boost
Net cash used in operating activities
Cash flows from investing activities
Purchase of intangibles
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Share issue costs
Proceeds of borrowings
Repayments of borrowings
Net cash provided by financing activities
Net increase in cash and cash equivalents held
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
-
4.1		 286,286
419,695
(3,659,726)
(3,085,726)
668,418
689,016
(89,128)
(25,953)
92,500
105,000
(2,701,650)
(1,897,968)
(36,410)
(30,000)
(36,410)
(30,000)
3,319,745
1,805,532
-
(87,855)
-
1,000,000
(500,000)
(700,000)
2,819,745
2,017,677
81,685
89,709
205,947
116,238
287,632
205,947

The consolidated statement of cash flows is to be read in conjunction with the accompanying notes.

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Page 10

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Notes to the Appendix 4E preliminary final report

for the year ended 30 June 2021

Note
1
Revenue and other income		 2021
2020
$ $
1.1
Revenue
Sales to customers
1.2
Other Income
Interest income
Research and development tax incentives grant income
JobKeeper Payment scheme_grant income
_ATO Cash flow boost_grant income
_Fair value adjustment of fee options		 288,741
425,167
288,741
425,167
-
57
988,711
707,925
67,500
30,000
25,000
75,000
58,792
-
1,140,003
812,982
Note
2
Loss before income tax		 2021
2020
$ $
The following significant revenue and expense items are relevant in explaining the
financial performance:
2.1
Administration expenses
Accounting expenses
Wages and salaries
Travel expenses
Interest expenses and finance facility costs
Other expenses
2.2
Corporate expenses
ASX fees
Audit expenses
Directors’ fees
Filing fees
Legal expenses
Share Registry and shareholder communications
2.3
Contract and consulting fees
Executive services contracts
Share-based performance rights
External consulting fees		 207,442
146,591
522,851
367,324
130,457
11,566
89,128
90,394
144,008
125,110
1,093,886
740,985
58,808
51,735
72,404
57,938
42,000
32,000
18,266
16,138
200,389
103,891
22,618
58,443
414,485
320,145
78,655
78,655
62,149
56,426
66,048
141,963
206,852
277,044
Note
3
Income tax		 2021
2020
$ $
3.1
Income tax benefit
Current tax		 -
-
-
-

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Page 11

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Notes to the Appendix 4E preliminary final report

for the year ended 30 June 2021

Note
4
Financial assets and financial liabilities
4.1
Cash and cash equivalents		 2021
2020
$ $
Cash at bank 287,632
205,947
287,632
205,947
4.2
Trade and other receivables		 2021
2020
$ $
4.2.1
Current
Trade receivables
Goods and Services Tax receivable
Research and Development Grant receivable
Other receivables		 24,068
21,625
45,133
73,733
988,711
668,418
64,979
377
1,122,891
764,153
4.3
Other assets		 2021
2020
$ $
4.3.1
Current
Prepayments – Raw Materials
Other deposits		 16,642
192,902
55,583
248,963
72,225
441,865
4.4
Financial assets		 2021
2020
$ $
4.4.1
Current
LDA Prepaid commitment fee
LDA Prepaid fair value of fee options		 400,000
-
604,000
-
1,004,000
-
4.5
Trade and other payables		 2021
2020
$ $
4.5.1
Current
Unsecured
Trade payables
Other payables		 277,637
300,377
170,361
208,764
447,998
509,141

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Page 12

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Notes to the Appendix 4E preliminary final report

for the year ended 30 June 2021

Note
4
Financial assets and financial liabilities (cont.)
4.6
Borrowings		 2021
2020
$ $
4.6.1
Current
Pre-factoring financing facility
Leases – motor vehicle
4.6.2
Non-current
Derivative liabilities
LDA Commitment fee liability		 -
500,000
30,990
-
30,990
500,000
945,208
-
945,208
-
Note
5
Non-financial assets and financial liabilities
5.1
Inventories		 2021
2020
$ $
Finished goods 223,225
155,705
223,225
155,705
5.2
Intangible assets		 2021
2020
$ $
SE FormulaTM
Accumulated amortisation
Website development costs
Accumulated amortisation
Total intangibles		 9,859,296
9,859,296
(1,601,478)
(1,212,476)
8,257,818
8,646,820
55,410
19,000
(23,078)
(11,996)
32,332
7,004
8,290,150
8,653,824

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Page 13

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Notes to the Appendix 4E preliminary final report

for the year ended 30 June 2021

Note 6 Equity

6.1
Issued capital		 2021
2020		 2021
2020
No.
No.		 $ $
Fully paid ordinary shares at no par value
6.1.1
Ordinary shares
At the beginning of the year
Shares issued during the year:
31.07.19 Placement
29.11.19 Convertible note
31.12.19 Corporate advisory
31.12.19 Project management
services
31.12.19 Convertible note
01.02.20 Placement
20.03.20 Placement
20.03.20 Lead Manager fee
20.03.20 Underwriting fee
20.03.20 Facility fee
14.05.20 Facility fee
22.06.20 Acquisition of IP
30.06.20 Options conversion
17.08.20 Options exercise
21.08.20 Share issue
19.09.20 Options exercise
30.09.20 Options exercise
30.11.20 Options exercise
11.12.20 Options exercise
23.12.20 Options exercise
31.12.20 Options exercise
31.12.20 Options exercise
22.01.21 Shortfall
25.02.21 Placement
16.05.2021 Collateral shares
issued to LDA Capital for nil
consideration
Transaction costs relating to share
issues
At reporting date		 406,977,266
323,284,299		 20,978,594
17,607,998
2021
No.
2020
No.		 2021
$ 2020
$
323,284,299
158,404,002		 17,607,998
15,286,784
-
113,675
-
450,199
-
19,800
-
55,551
-
200,000
-
1,004,798
-
350,000
-
25,000
-
25,000
-
25,000
-
25,000
-
20,000
-
134,786
14,500
-
120,000
-
29,250
-
37,414
-
88,754
-
203,991
-
124,779
-
430,757
-
488,294
-
632,857
-
1,200,000
-
-
-
-
(127,595)
-
4,059,838
-
3,001,326
-
761,538
-
2,734,892
-
12,500,000
-
100,479,822
-
29,800,000
-
2,500,000
-
2,000,000
-
2,000,000
-
300,000
-
250,000
-
4,492,881
483,333
-
2,000,000
-
975,001
-
1,247,167
-
2,958,465
-
6,799,688
-
4,159,266
-
14,358,546
-
4,882,930
-
6,328,571
-
12,000,000
-
27,500,000
-
-
-
406,977,266
323,284,299		 20,978,594
17,607,998

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Page 14

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Notes to the consolidated financial statements

for the year ended 30 June 2021

Note 6 Equity (cont.)

6.2
Options		 2021
2020		 2021
2020
No.
No.		 $ $
Options
At the beginning of the year
Options movement during the year:
31.12.19 Convertible note
31.12.19 Convertible note
06.03.20 Expiry of options
17.03.20 Placement
20.03.20 Placement
30.06.20 Conversion
17.08.20 Options exercise
21.08.20 Option issue
19.09.20 Options exercise
30.09.20 Options exercise
30.11.20 Options exercise
11.12.20 Options exercise
23.12.20 Options exercise
31.12.20 Options exercise
31.12.20 Options exercise
31.12.20 Expiry of options
Previously expired options
06.04.21 Fee options issued to
LDA Capital
At reporting date
Comprising the following options:
Listed, ex. price $0.10 exp. date
31.12.20
Unlisted, ex. price $0.03 exp.
date 31.12.20
Unlisted, ex. price $0.12 exp.
date 15.03.24
Unlisted, ex. price $0.15 exp.
date 15.03.24
Unlisted, ex. price $0.18 exp.
date 15.03.24
Unlisted, ex. price $0.22 exp.
date 15.03.24
At reporting date		 26,000,000
126,004,034		 -
-
-
116,816
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(116,816)
-
-
126,004,034
81,965,315
-
3,001,326
-
9,375,000
-
(338,000)
-
33,493,274
-
3,000,000
-
(4,492,881)
(483,333)
-
200,000
-
(975,001)
-
(1,247,167)
-
(2,958,465)
-
(6,799,688)
-
(4,159,266)
-
(14,358,546)
-
(4,882,930)
-
(90,339,638)
-
-
-
26,000,000
-
26,000,000
126,004,034		 -
-
-
97,003,641
-
29,000,393
10,000,000
-
10,000,000
-
4,000,000
-
2,000,000
-		 -
-
-
-
-
-
-
-
-
-
-
-
26,000,000
126,004,034		 -
-

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Page 15

APPENDIX 4E Preliminary final report 30 June 2021

SKIN ELEMENTS LIMITED AND CONTROLLED ENTITIES

ABN 90 608 047 794

Notes to the consolidated financial statements

for the year ended 30 June 2021

Note
6
Equity (cont.)
6.3
Performance rights		 2021
2020		 2021
2020
No.
No.		 $ $
Performance rights
At the beginning of the year
Performance rights movement
during the year:
Issued
Fair value adjustments
Lapsed
Amortise of Performance shares
issued in 30 June 2020 financial
year
At reporting date		 47,000,000
47,000,000		 91,252
29,103
29,103
195,522
-
29,103
-
27,323
-
(222,845)
62,149
-
47,000,000
2,200,000
-
47,000,000
-
-
-
(2,200,000)
-
-
47,000,000
47,000,000		 91,252
29,103
6.4
Reserves		 2021
2020
$ $
Share-based payment reserve 91,252
29,103
91,252
29,103

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Page 16

APPENDIX 4E Preliminary final report 30 June 2021

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