SKS TECHNOLOGIES GROUP LIMITED — Interim / Quarterly Report 2019

Feb 20, 2019

ENEVIS LIMITED ABN 24 004 554 929 Interim Financial Report – 31 December 2018

Appendix 4D - Half Year Report for six months ended 31 December 2018

Results for announcement to the market

Name of entity ENEVIS LIMITED ABN 24 004 554 929

1 Reporting Period

Half Year Ended 31 December 2018 Previous corresponding periods – half year ended 31 December 2017 – year ended 30 June 2018

2 Results for announcement to the market

Revenue from ordinary activities up 56% to 19,915,245 Net profit/(loss) from ordinary activities after tax attributable to members NM to 94,679 Net profit/(loss) for the period attributable to members NM+ to 94,679 NM – Not Meaningful (A profit of $94,679 compared to loss of $2,296,422 in the previous corresponding period for continuing operations) +(A profit of $94,679 compared to loss of $2,284,862 in the previous corresponding period) Amount per Security Franked amount per Security Interim Dividend - Current period Nil Nil - Previous corresponding period Nil Nil Final Dividend - Current period Nil Nil - Previous corresponding period Nil Nil
No interim dividend has been declared for the half-year ending 31 December 2018.
Commentary on Result
First half trading improved significantly with group sales revenues of $19,915,245 up by 56% compared to
$12,775,242 in the previous corresponding period for continuing operations. The Group reported a net profit of
$94,679 for the half year ended 31 December 2018, being an improvement from a loss of $2,284,862 in the
previous corresponding period.
Refer to interim Financial Report for the Half-Year ended 31 December 2018 for more information.
This half yearly financial report is to be read in conjunction with the 30 June 2018 annual financial
report.

ENEVIS LIMITED ABN 24 004 554 929 Interim Financial Report – 31 December 2018

3 Net tangible assets per security

Previous Current Period Corresponding Period Net tangible asset backing per ordinary security 0.97 (7.34) (cents per share)

4. Details of entities over which control has been gained or lost during the period: (item 4) Control gained over entities

Name of entities (item 4.1) - Not Applicable - Date(s) of gain of control (item 4.2) Contribution to consolidated profit (loss) from ordinary $ activities after tax by the controlled entities since the date(s) in the current period on which control was acquired (item 4.3) Profit (loss) from ordinary activities after tax of the $ controlled entities for the whole of the previous corresponding period (item 4.3)

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Loss of control of entities

Name of entities (item 4.1) - Not Applicable - Date(s) of loss of control (item 4.2)

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 lost (item 4.3). Profit (loss) from ordinary activities after tax of the $ controlled entities for the whole of the previous corresponding period (item 4.3)

ENEVIS LIMITED ABN 24 004 554 929

Interim Financial Report – 31 December 2018

5. Dividends (item 5)

Interim dividend year ended 30 June 2018 Final dividend year ended 30 June 2018	Date of payment	Total amount of dividend
		Nil
		Nil

Amount per security

Amount per security
	Amount per security	Franked amount per security at % tax	Amount per security of foreign sourced dividend
Total dividend: Current year Previous year	Nil	Nil	Nil
	Nil	Nil	Nil

Total dividend on all securities

otal dividend on all securities
Ordinary securities_(each class separately)_	Current period $A'000 Previous corresponding Period-$A'000
	Nil	Nil

6. Details of dividend or distribution reinvestment plans in operation are described below (item 6) :

• Not Applicable -

The last date(s) for receipt of election notices for participation in the dividend or distribution reinvestment plan

ENEVIS LIMITED ABN 24 004 554 929 Interim Financial Report – 31 December 2018

7. Details of associates and joint venture entities (item 7)

Name of associate or joint venture entity %Securities held - Not Applicable -

Aggregate share of profits (losses) of associates and joint venture entities

2018 2017 Group’s share of associates’ and joint venture entities’: $ $ Profit (loss) from ordinary activities before tax Income tax on ordinary activities Net profit (loss) from ordinary activities after tax Adjustments Share of net profit (loss) of associates and joint venture entities

8. The financial information provided in the Appendix 4D is based on the half year condensed financial report (attached).

9. Independent review of the financial report (item 9)

The financial report has been independently reviewed. The financial report is not subject to a qualified independent review statement.

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ENEVIS LIMITED and Controlled Entities

ABN 24 004 554 929

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Financial Report for the half-year ended 31 December 2018

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The half-year financial report is to be read in conjunction with the financial report for the year ended 30 June 2018

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

TABLE OF CONTENTS

	Page
Directors’ Report	2
Auditor’s Independence Declaration	4
Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income	5
Condensed Consolidated Statement of Financial Position	6
Condensed Consolidated Statement of Changes in Equity	7
Condensed Consolidated Statement of Cash Flows	8
Notes to the Condensed Consolidated Financial Statements	9
Directors’ Declaration	17
Independent Auditor’s Review Report	18

ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Directors’ Report

The directors present their report together with the condensed financial report of the consolidated entity consisting of Enevis Limited and the entities it controlled, for the half-year ended 31 December 2018 and independent review report thereon.

Directors

The names of the company’s directors in office during the half-year and until the date of this report are set out below. Each of the directors was in office for this entire period, unless otherwise stated.

Peter Jinks, Managing Director Greg Jinks, Executive Director Terence Grigg, Non-Executive Director Tom Krulis, Non-Executive Director

Review and Results of Operations

First half sales have improved significantly with group trading revenues of $19,915,245 up 56% on the $12,775,242 in the previous corresponding period from the continuing business operations of the Company. The group reported a net profit for the half year ended 31 December 2018 of $94,679 compared to a loss of $2,284,862 in the previous corresponding period.

The results for the half year reflects the impact of the following key matters:

• On 1 August 2018, the Company completed the acquisition of the Lumex Electrical business and assets under the Asset Sale Agreement between Scholz Industries Pty Ltd and Urban Lighting Group Pty Ltd, a wholly owned subsidiary of Enevis Limited. The Lumex business adds significantly to the Groups product portfolio with its energy efficiency LED lighting and controls and brings an established revenue base and opportunities to leverage synergies across the groups customer base.

• In August 2018, the Company raised $3.26 million from a capital raise (net of costs) that were used to fund the working capital requirements of the expanded business, following completion of the acquisition of the Lumex Electrical business and assets, integration costs and retire debt.

• The sales growth in SKS Technologies (our audio visual and electrical division) continues and has been driven by an increasing recognition of the brand and quality of service delivery. The company also established a ‘Greenfields’ operation in South Australia which has exceeded expectations. The pipeline of opportunities, as well as the size of opportunities, remains favourable.

• Urban Lighting Group, our street and commercial lighting subsidiary, made steady progress in the first half. The amount of infrastructure activity and residential land developments remain high and we are finding strong demand within our Street Lighting division. Likewise, our commercial lighting brand is succeeding in winning quality projects, for example the Energy Efficient Lighting Upgrade to Melbourne Star.

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Directors’ Report (Cont’d)

Auditor’s Independence Declaration

A copy of the auditor’s independence declaration as required under section 307C of the Corporation Act 2001 in relation to the review for the half-year is provided with this report on page 4.

Rounding of Amounts

In accordance with ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 , the amounts in the directors’ report and in the financial report have been rounded to the nearest dollar.

Signed in accordance with a resolution of the directors.

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Peter Jinks Director

Melbourne

Date: 20 February 2019

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ENEVIS LIMITED

AUDITOR’S INDEPENDENCE DECLARATION TO THE DIRECTORS OF ENEVIS LIMITED

In relation to the independent auditor’s review for the half‐year ended 31 December 2018, to the best of my knowledge and belief there have been:

• (i) no contraventions of the auditor independence requirements of the Corporations Act 2001 ; and

• (ii) no contraventions of APES 110 Code of Ethics for Professional Accountants.

This declaration is in respect of Enevis Limited and the entities it controlled during the period.

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F V RUSSO Partner 20[th] February 2019

PITCHER PARTNERS Melbourne

Pitcher Partners is an association of independent firms Melbourne | Sydney | Perth | Adelaide | Brisbane| Newcastle An independent member of Baker Tilly International

An independent Victorian Partnership ABN 27 975 255 196 Level 13, 664 Collins Street, Melbourne VIC 3000 Liability limited by a scheme approved under Professional Standards Legislation

ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income for the half-year ended 31 December 2018

Notes Revenue and Other Income Sales revenue 2 Other income 2 Expenses Cost of sales Occupancy expenses Administration expenses Depreciation and amortisation Impairment charge Finance costs Total expenses Profit / (loss) before income tax expense from continuing operations Income tax expense Profit / (loss) from continuing operations Profit after tax from discontinued operation Other comprehensive income for half-year Total comprehensive income for half-year Earnings per share (cents per share) for profit attributable to the equity holders of the entity: Basic earnings / (loss) per share – Continuing Operations Basic earnings / (loss) per share – Discontinued Operation Diluted earnings / (loss) per share – Continuing Operations Diluted earnings / (loss) per share – Discontinued Operation	Half- year 31 December 2018 31 December 2017 $ $ 19,915,245 12,775,242 - 4
	19,915,245 12,775,246
	(14,820,497) (9,720,457) (301,009) (263,667) (4,277,179) (3,238,668) (110,487) (73,358) - (1,479,288) (311,394) (296,230)
	(19,820,566) (15,071,668) 94,679 (2,296,422) - -
	94,679 (2,296,422) - 11,560 - -
	94,679 (2,284,862)
	0.15 (5.51) - 0.03 0.15 (5.51) - 0.03

The accompanying notes forms part of these Financial Statements

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Condensed Consolidated Statement of Financial Position as at 31 December 2018

Notes Current assets Cash and cash equivalents Trade and other receivables Inventories Other current assets Total current assets Non-current assets Plant and equipment Intangible assets 10 Total Non-current assets Total assets Current liabilities Trade and other payables Borrowings 5(a) R&D tax payable Provisions Total current liabilities Non-current liabilities Borrowings 5(b) Provisions Total non-current liabilities Total Liabilities Net assets (Net asset deficiency) Equity Contributed capital 6 Accumulated losses Total equity	31 December 2018 30 June 2018 $ $ 138,623 121,932 7,489,505 5,116,069 5,441,092 2,618,280 383,393 93,002
	13,452,613 7,949,283
	563,464 466,864 1,183,250 814,581
	1,746,714 1,281,445
	15,199,327 9,230,728
	7,724,811 5,396,530 2,049,356 3,376,118 2,101,361 2,524,819 635,261 552,243
	12,510,789 11,849,710
	761,110 349,251 96,339 75,213
	857,449 424,464
	13,368,238 12,274,174
	1,831,089 (3,043,446)
	19,198,931 14,419,075 (17,367,842) (17,462,521)
	1,831,089 (3,043,446)

The accompanying notes forms part of these Financial Statements

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Condensed Consolidated Statement of Changes in Equity

Half-year ended 31 December 2017 Consolidated At 1 July 2017 Loss for the half year Transactions with owners in their capacity as owners Issue of shares At 31 December 2017 Half-year ended 31 December 2018 Consolidated At 1 July 2018 Profit for the half year Transactions with owners in their capacity as owners Issue of shares to vendor of Lumex Issue of shares Cost of issue of shares Issue of shares on conversion of Convertible Notes At 31 December 2018	Contributed equity Accumulated losses Total equity $ $ $ 14,277,752 (14,453,604) (175,852) - (2,284,862) (2,284,862) 172,000 - 172,000
	14,449,752 (16,738,466) (2,288,714)
	Contributed equity Accumulated losses Total equity $ $ $ 14,419,075 (17,462,521) (3,043,446) - 94,679 94,679 1,117,509 - 1,117,509 3,450,000 - 3,450,000 (187,653) - (187,653) 400,000 - 400,000
	19,198,931 (17,367,842) 1,831,089

The accompanying notes forms part of these Financial Statements

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ENEVIS LIMITED ABN 24 004 554 929

Financial report for half-year ended 31 December 2018

Condensed Consolidated Statement of Cash Flows for the half-year ended 31 December 2018

Cash flows from operating activities Receipts from customers Payments to suppliers and employees Interest received Interest paid Net cash flows used in operating activities Cash flows from investing activities Payment for plant and equipment Proceeds from disposal of plant and equipment Payments for intangibles Proceeds from sale of business Net cash flows (used in) / from investing activities Cash flows from financing activities Proceeds from issue of shares Repayment of convertible notes Proceeds from borrowings Repayments of borrowings Net cash flows from / (used in) financing activities Net increase / (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of half year Cash and cash equivalents at end of the half year	Half-year 31 December 2018 31 December 2017 $ $ 19,536,561 14,164,408 (21,157,999) (14,841,524) - 4 (255,942) (225,571)
	(1,877,380) (902,683)
	(150,127) (17,780) 12,097 - (236,430) - - 787,642
	(374,460) 769,862
	3,062,347 172,000 - (1,335,894) 293,847 - (1,087,663) (593,824)
	2,268,531 (1,757,718)
	16,691 (1,890,539) 121,932 2,161,246
	138,623 270,707

The accompanying notes forms part of these Financial Statements

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Notes to Condensed Consolidated Half-Year Financial Statements

1. Basis of Preparation of the Half-Year Financial Report

The condensed consolidated half-year financial report does not include all notes of the type normally included within the annual financial report. It is recommended that this half-year financial report be read in conjunction with the annual financial report for the year ended 30 June 2018 and any public announcements made by Enevis Limited during the half-year in accordance with any continuous disclosure obligations arising under the Corporations Act 2001 .

This condensed half-year financial report covers Enevis Limited and controlled entities as a consolidated entity. Enevis Limited is a company limited by shares, incorporated and domiciled in Australia. The address of Enevis Limited’s registered office and principal place of business is 53 Stanley Street, West Melbourne VIC - 3003. Enevis Limited is a for-profit entity for the purpose of preparing the financial statements.

The half-year financial report was authorised for issue by the directors as at the date of the director’s report.

(a) Basis of accounting

This condensed consolidated half-year financial report has been prepared in accordance with Australian Accounting Standard AASB 134 Interim Financial Reporting , as appropriate for for-profit entities, and the Corporations Act 2001 . Compliance with AASB 134, as appropriate for for-profit entities, ensures compliance with International Financial Reporting Standard IAS 34 Interim Financial Reporting .

The half-year financial report has been prepared in accordance with the historical cost convention, as modified by revaluations to fair value for certain class of assets as described in the accounting policies.

The accounting policies applied in this half-year financial report are consistent with those of the annual financial report for the year ended 30 June 2018 and the corresponding half-year other than as stated below in Note 1(b).

(b) Summary of the significant accounting policies

The Group adopted AASB 15 Revenue from Contracts with Customers from 1 July 2018. AASB 15 provides (other than in relation to some specific exceptions, such as lease contracts and insurance contracts) a single source of accounting requirements for all contracts with customers, thereby replacing all current accounting pronouncements on revenue. The core principle of AASB 15 is that an entity recognises revenue to depict the transfer of promised goods or services to a customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Accordingly, in contrast to the approach under AASB 118 Revenue, AASB 15 does not prescribe different patterns of revenue recognition depending on whether the entity provides a good or service to the customer.

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Notes to Condensed Consolidated Half-Year Financial Statements

(b) Summary of the significant accounting policies (cont’d)

The Group adopted AASB 15 with no material impact resulting to revenue recognised. The accounting policy in relation to revenue after the adoption of AASB 15 is included in Note 1 (c).

The Group adopted AASB 9 Financial Instruments, from 1 July 2018. AASB 9 replaces AASB 139: Financial Instruments: Recognition and Measurement. The key changes to the requirements in AASB 139 include:

• simplifying the general classifications of financial assets into those carried at amortised cost and those carried at fair value;

• permitting entities to irrevocably elect on initial recognition to present gains and losses on an equity instrument that is not held for trading in other comprehensive income (OCI);

• simplifying the requirements for embedded derivatives, including removing the requirements to separate and fair value embedded derivatives for financial assets carried at amortised cost;

• requiring an entity that chooses to measure a financial liability at fair value to present the portion of the change in its fair value due to changes in the entity’s own credit risk in OCI, except when it would create an ‘accounting mismatch’;

• introducing a new model for hedge accounting that permits greater flexibility in the ability to hedge risk, particularly with respect to non-financial items; and

• requiring impairment of financial assets carried at amortised cost to be based on an expected loss approach.

The Group adopted AASB 9 with no resulting change to the classification and measurement of the groups payables and borrowings. In relation to impairment of financial assets, the changes to the expected loss approach did not have a material impact to the groups financial position.

(c) Revenue

Revenue from the sale of goods is recognised when the customer receives the goods and ownership of the goods have passed and the costs incurred or to be incurred in respect of the transaction can be measured reliably. Ownership is considered to have passed to the buyer at the time of delivery of the goods to the customer.

Revenue from the provision of service is recognised over time, when the Group satisfies performance obligations by transferring the promised services to its customers on the basis that the following criteria are met:

• The customer simultaneously receives and consumes the benefits provided by the group’s performance as the entity performs;

• the group’s performance creates or enhances an asset that the customer controls as the asset is created or enhanced;

• the group’s performance does not create an asset with an alternative use to the entity and the entity has an enforceable right to payment for performance completed to date.

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Notes to Condensed Consolidated Half-Year Financial Statements

(c) Revenue (cont’d)

Certain customers may be invoiced in advance of provision of services and this amount is recognised as a liability until the group provides, and the customer consumes, the benefits of the services.

Interest revenue is recognised when it becomes receivable on a proportional basis taking into account the interest rates applicable to the financial assets.

All revenue is stated net of the amount of Goods and Services Tax (GST).

(d) Going Concern

The financial report has been prepared on a going concern basis which contemplates the continuity of normal business activities and realisation of assets and settlement of liabilities in the ordinary course of business.

The group generated a profit from continuing operations of $94,679 during the half-year ended 31 December 2018 (half-year ended 31 December 2017 loss of $2,296,422), and as at that date, the group’s net asset position was $1,831,089 (30 June 2018: net asset deficiency $3,043,446).

The working capital position as at 31 December 2018 results in an excess of current assets over current liabilities of $941,824 (30 June 2018: current liabilities over current assets $3,900,427).

The group produced negative cash flows from operating activities for the half-year ended 31 December 2018 of $1,877,380 following investment in working capital (half-year ended 31 December 2017: $902,683). The ability of the Group to continue as a going concern is reliant on generating profits, improving cash flows from operating activities, managing debt levels, and the management of other cash flows within the Group’s funding facilities.

Notwithstanding the above, the directors believe the going concern basis is appropriate due to the following factors:

• The Group has prepared forward budget and cash flow projections which are based on increasing revenues from the expanding technologies divisions of lighting and audio-visual products and solutions which support improving cashflows from operating activities.

• The technology division remains in a growth phase which has meant investment in people, facilities and equipment to allow for this growth. The directors expect that this investment which has already delivered significant growth will result in, not only further growth, but profitability and positive operating cash flows in the future.

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Notes to Condensed Consolidated Half-Year Financial Statements

(d) Going Concern (cont’d)

• The Group has secured an in-principle settlement with the Australian Taxation Office for an orderly repayment of the R&D tax payable booked. Broadly, this comprise a 10% upfront payment of the debt (which was fulfilled in the half year period to 31 December 2018) with the balance to be paid in instalments over a three (3) year timeframe. The terms of this agreement remain to be formalised by written agreement which is expected to take place by no later than 31 March 2019. This delay is purely administrative in nature and importantly there is no dispute with the ATO. This in-principle agreement enables the Group to manage repayment of this debt.

As legal documentation (generally compromising a deed of agreement & security and deed of priority) remains pending as at the date of this report, the R&D Tax Payable has been classified as all current. That noted, based on the payment schedule that has been agreed with the ATO, the following is an indicative current / non-current split from a cashflow repayment perspective:

R&D Tax Payable Current Non-Current	31 December 2018 - 2,101,361 2,101,361

• The Group has secured agreement from Moller Volantor Pty Ltd to defer the repayment date on the $450,000 secured loan and the $300,000 unsecured loan for a further 12 months to be repaid in full on 31 October 2020, although the Group retains the right (but not the obligation) to repay these loans earlier if cashflows allow. These deferrals further assist the Group in realigning its debt repayment obligations to coincide with expected improved future cashflows. Attention is also drawn to the note 8 Subsequent Events.

• The directors also believe the company has quality assets that could be realised if required to raise further capital to fund working capital requirements.

Based on the above the directors believe that the Group will continue as a going concern over the next 12 months and consequently will realise assets and settle liabilities and commitments in the ordinary course of business and at the amounts stated in the financial report.

If the going concern basis of accounting is found to no longer be appropriate, the recoverable amounts of the assets shown in the statement of financial position are likely to be significantly less than the amounts disclosed and the extent of the liabilities may differ significantly from those reflected in the statement of financial position.

(e) Comparatives

Where necessary, comparative information has been reclassified and repositioned for consistency with current year disclosures.

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Notes to Condensed Consolidated Half-Year Financial Statements

2. Revenue and Other Income

Revenue Revenue from services Revenue from sale of goods Other income Interest income Other	31 December 2018 31 December 2017 $ $ 11,911,765 7,507,183 8,003,480 5,268,059
	19,915,245 12,775,242
	- 4 - -
	- 4

3. Acquisition of controlled entities

On 1 August 2018, the Group completed the acquisition of the Lumex Electrical business and assets under the Asset Sale Agreement (ASA) between Scholz Industries Pty Ltd and Urban Lighting Group Pty Ltd, a wholly owned entity of Enevis Limited.

Details of the assets and liabilities acquired and consideration paid is as follows:

Inventory Plant and equipment Entitlement to NuGreen shares Employee entitlements Goodwill Total consideration paid	862,516 39,570 66,067 (13,713) 163,069 1,117,509

Details of the purchase consideration

• a. Consideration paid

In accordance with the terms of the ASA, the company issued 5,587,547 new shares in the Company (Up-Front Shares) to the seller on 1 August 2018 at $0.20 per share equating to $1,117,509.

• b. Contingent consideration

The ASA provided for the issue of up to a further 4,000,000 fully paid ordinary shares in the capital of the Company over a period of approximately 2 years (Deferred Shares) subject to certain revenue and EBITDA hurdles being satisfied. Details of this was disclosed in Note 24 of the consolidated entity’s annual financial statements for the year ended 30 June 2018. The fair value of this contingent consideration is $0.

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Notes to Condensed Consolidated Half-Year Financial Statements

3. Acquisition of controlled entities (cont’d)

Contribution since acquisition

Since acquisition date the Lumex business assets have contributed revenue of $2,759,355.

Transaction costs

The Group incurred legal costs associated with the ASA totalling $42,537 which have been expensed in the Statement of Profit or Loss and Other Comprehensive Income.

4. Dividends Paid or provided for on Ordinary Shares

There were no dividends proposed or recognised during the half-year ended 31 December 2018.

5. Borrowings

(a) Current Secured: Bank and other loans (i) Lease finance (ii) Loan from Moller Volantor Pty Ltd (iii) Unsecured: Convertible Notes (unlisted) (iv) Loan from Moller Volantor Pty Ltd (v) (b) Non Current Secured: Lease finance (ii) Loan from Moller Volantor Pty Ltd (iii) Unsecured: Loan from Moller Volantor Pty Ltd (v)	31 December 2018 30 June 2018 $ $ 1,956,486 1,662,639 92,870 113,479 - 1,000,000 - 400,000 - 200,000
	2,049,356 3,376,118
	11,110 49,251 450,000 - 300,000 300,000
	761,110 349,251

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Notes to Condensed Consolidated Half-Year Financial Statements

5. Borrowings (cont’d)

• i. The current secured borrowings, are secured by a fixed and floating charge over Enevis Limited, SKS Technologies Pty Ltd, Dueltek Pty Ltd and Urban Lighting Group Pty Ltd.

• ii. Both current and non-current finance leases were secured by assets acquired utilising finance lease facilities.

• iii. Non-current secured loan from Moller Volantor Pty Ltd, an entity related to Greg Jinks, secured by a second ranking fixed and floating charge over Enevis Limited. This loan bears interest at a fixed rate of 10% per annum payable quarterly in arrears, to be repaid in full on 31 October 2020 (or earlier at the company’s discretion).

• iv. The Convertible Notes (unlisted) were a 2 year financial instrument which bore interest at a fixed rate of 10% per annum and were fully converted into ordinary shares on 28 October 2018.

• v. Non-current unsecured loan from Moller Volantor Pty Ltd, an entity related to Greg Jinks. This loan bears interest at a fixed rate of 10% per annum payable monthly in arrears, to be repaid in full on 31 October 2020 (or earlier at the company’s discretion).

6. Contributed Capital

Movements in shares on issue

ovements in shares on issue
Beginning of the half-year Shares issued during the half- year End of the half-year	Half-Year 31 Dec 2018 Half-Year 31 Dec 2017 No of Shares $ No of Shares $ 42,087,214 14,419,075 41,513,880 14,277,752 24,523,886 4,779,856 573,334 172,000
	66,611,100 19,198,931 42,087,214 14,449,752

7. Operating Segments

The Group operates predominantly in Australia, in the lighting and audio-visual markets which is regarded as a single segment, hence there is no information on operating segments provided in this report.

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ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Notes to Condensed Consolidated Half-Year Financial Statements

8. Subsequent Events

The Group made a drawdown from Moller Volantor Pty Ltd, an entity related to Greg Jinks, under the pre existing secured loan agreement (as detailed in note 5 iii) to the amount of $500,000. This loan bears interest at a fixed rate of 10% per annum payable quarterly in arrears and this loan component is planned to be repaid within 12 months. This forecast funding requirement was created by investment in inventory leading into the Chinese New Year, growth investment across the group with focus in the ‘green fields’ SA operation and routine seasonality of the business cycle over the Christmas / New Year period.

Other than the above, there were no matters or circumstances specific to Enevis Limited that have arisen since 31 December 2018 that have significantly affected or may significantly affect:

• the Group’s operation in future financial years or

• the results of those operations in future financial years or

• the Group’s state of affairs in future financial years.

9. Business Combinations - Discounted operations ( Prior period)

On 15 December 2017, the Company sold its Dueltek Distribution business and associated business assets. Details of this discontinued operations was disclosed in Note 4 of the consolidated entity’s annual financial statements for the year ended 30 June 2018.

10. Intangible assets

10. Intangible assets
	31 December	30 June
	2018	2018
	$	$
Goodwill at cost (a)	814,618	651,549
Brand name – Forlite	150,000	150,000
Computer software	105,226	13,032
Development costs (b)	113,406	-
	1,183,250	814,581
(a) Reconciliation of carrying amounts at the beginning and end of the period
Goodwill
Carrying value as at 1 July	651,549	773,327
Goodwill on acquisition of Lumex	163,069	(121,778)
Closing carrying value	814,618	651,549
(b) Reconciliation of carrying amounts at the beginning and end of the period
Development costs
Carrying value as at 1 July	-	-
Developments costs - Lumex	121,740	-
Amortisation	(8,334)	-
Closing carrying value	113,406	-

Page - 16

ENEVIS LIMITED ABN 24 004 554 929 Financial report for half-year ended 31 December 2018

Directors’ Declaration

The directors declare that:

In the directors’ opinion, the financial statements and notes thereto, as set out on pages 5 to 16 are in accordance with the Corporations Act 2001 , including:

• (a) complying with Australian Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 ; and

• (b) giving a true and fair view of the financial position of the consolidated entity as at 31 December 2018 and of its performance for the half-year ended on that date.

In the directors’ opinion there are reasonable grounds, at the date of this declaration, to believe that Enevis Limited will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the directors.

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Peter Jinks Director

Date: 20 February 2019

Page - 17

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ENEVIS LIMITED ABN 30 146 959 917 AND CONTROLLED ENTITES

INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF ENEVIS LIMITED

Report on the Half‐Year Financial Report

We have reviewed the accompanying half‐year financial report of Enevis Limited “the Company” and its controlled entities “the Group”, which comprises the condensed consolidated statement of financial position as at 31 December 2018, the condensed consolidated statement of comprehensive income, condensed consolidated statement of changes in equity and condensed consolidated statement of cash flows for the half‐year ended on that date, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration.

Directors’ Responsibility for the Half‐Year Financial Report

The directors of the Company are responsible for the preparation of the half‐year financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the half‐year financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express a conclusion on the half‐year financial report based on our review. We conducted our review in accordance with Auditing Standard on Review Engagements ASRE 2410 Review of a Financial Report Performed by the Independent Auditor of the Entity , in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the half‐year financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the Group’s financial position as at 31 December 2018 and its performance for the half‐ year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001 . As the auditor of Enevis Limited and controlled entities, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report.

A review of a half‐year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Pitcher Partners is an association of independent firms Melbourne | Sydney | Perth | Adelaide | Brisbane| Newcastle An independent member of Baker Tilly International

An independent Victorian Partnership ABN 27 975 255 196 Level 13, 664 Collins Street, Docklands VIC 3008 Liability limited by a scheme approved under Professional Standards Legislation

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ENEVIS LIMITED ABN 30 146 959 917 AND CONTROLLED ENTITES

INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF ENEVIS LIMITED

Independence

In conducting our review, we have complied with the independence requirements of the Corporations Act 2001 . We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of Enevis Limited, would be in the same terms if given to the directors as at the time of this auditor’s report.

Conclusion

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half‐year financial report of Enevis Limited and controlled entities is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the financial position as at 31 December 2018 and of its performance for the half‐year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting and Corporations Regulations 2001 .

Material Uncertainty

We note that the company has made a net profit of $94,679 for the period ended 31 December 2018 compared to a loss of $2,296,422 for the prior corresponding period. We draw attention to Note 1(d) in the financial report which indicates the existence of a material uncertainty that may cast significant doubt about the Company’s ability to continue as a going concern and therefore, the Company may be unable to realise its assets and discharge its liabilities in the normal course of business. Our conclusion is not modified in respect of this matter.

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F V RUSSO Partner

PITCHER PARTNERS Melbourne

20[th] February 2019

An independent Victorian Partnership ABN 27 975 255 196 Level 13, 664 Collins Street, Docklands VIC 3008 Liability limited by a scheme approved under Professional Standards Legislation

Pitcher Partners is an association of independent firms Melbourne | Sydney | Perth | Adelaide | Brisbane| Newcastle An independent member of Baker Tilly International