USCOM LIMITED — Interim / Quarterly Report 2015

Jul 26, 2015

Uscom Limited ABN 35 091 028 090 Suite 1, Level 7, 10 Loftus Street Sydney NSW 2000 Australia T +612 9247 4144 F +612 9247 8157 www.uscom.com.au

M A R K E T A N N O U N C E M E N T

Quarterly Report to 30 June 2015

Year on year sales growth of 59% Net operating quarterly cash flow of -$0.045m International acquisition to boost manufacturing, revenue and products New US VP Business Development appointed

SYDNEY, Australia, Monday 27th July 2015: Uscom Limited (ASX code: UCM) (the Company or Uscom ), a revenue stage, cardiovascular medical devices company, today released its Appendix 4C – Quarterly Cashflow report for the quarter ended 30 June 2015 (the Quarter ). The results disclosed in the attached Appendix 4C are in Australian dollars.

Highlights

During the Quarter, we note the following:

• Annual receipts from customers for 2015 up 59%

• Net quarterly operating cash flows of -$0.045m

• International ultrasound acquisition to boost manufacturing, revenue and products

• Former Welch Allyn executive appointed Uscom US VP Business Development

Significant events after the reporting period

Uscom completed a successful capital raise of $1.55m on 23 July 2015, and has announced an SPP for current shareholders underwritten for a further $0.4m. The Company also announced the acquisition of Thor Laboratories, a Hungarian ultrasound respiratory device manufacturer, for $700,000 in cash and additional earn-outs of $200,000 in cash and 500,000 shares over a three year period. The Company considers the Thor acquisition to be a key strategic growth opportunity, providing additional revenue, internationally accredited manufacturing and R&D capabilities, distribution and a suite of ultrasonic spirometry products to Uscom.

Business Review

Quarterly results demonstrate a 59% annual growth in customer receipts and a 32% diminished quarterly year on year cash consumption, despite increased staff and R&D costs. Net operating cash flows for the quarter were -$0.045m.

The sales growth was almost entirely from USCOM 1A and reflects an increasing clinical take up of the flagship Uscom cardiac output monitor. This take up was driven by new scientific publications demonstrating the effectiveness of the USCOM 1A across a range of clinical applications. The most important publication was in the use of USCOM 1A for detection of pre-eclampsia (i.e. hypertension in pregnancy) where its use was associated with earlier detection, more rapid treatment, and better outcomes for mothers and children. The author recommended USCOM 1A be uses as a screening device for pregnancy.

Uscom Limited ABN 35 091 028 090 Suite 1, Level 7, 10 Loftus Street Sydney NSW 2000 Australia T +612 9247 4144 F +612 9247 8157 www.uscom.com.au

M A R K E T A N N O U N C E M E N T

The Company appointed Stephen Wilson as US VP Business Development to head the marketing, reimbursement and distribution activities of Uscom products in the US. Stephen has 20 years experience in the field of blood pressure monitoring having developed patent protected blood pressure technology and led the marketing of new blood pressure devices in his position as VP Corporate Development for Welch Allyn, USA. His appointment to Uscom will accelerate the adoption of the Uscom BP+ central blood pressure monitor in the US market once the USA CPT Code 1 approval for central blood pressure measurement is introduced (expected to be early in 2016).

The Company maintains its strategy of increasing distribution to drive sales and revenue, and recently announced the appointment of an additional 8 distributors throughout India, the Middle East, Europe and Australia, taking to 38 the total number of distributor agreements for Uscom products worldwide.

Development continues on the Uscom BP+ in preparation for global volume marketing. The China regulatory approval is under way for the BP+ which will lead to initiation of the China Pioneer distribution deal, which is contracted to deliver an average $1.4m US revenue per annum over each of the next 5 years to Uscom.

Executive Chairman of Uscom, Associate Professor Rob Phillips said “ The Company continues to meet its financial milestones and is now at an operational inflection point; reporting year on year revenue and sales growth averaging in the order of 60% for the last two consecutive years with a 20% decreased annual cash consumption despite increasing personnel and R&D costs. Uscom has also acquired two international medical device companies in the last 3 years, both of which bring sector leading products to Uscom with significant distribution synergies and sales opportunities.

Current growth is being driven by growth of USCOM 1A sales, which will continue, while we anticipate increasing revenue from BP+ sales associated with the Pioneer contract and China approval, and from the USA CPT Code 1 introduction early in 2016. Thor, the most recent Uscom acquisition, had more than A$500k annual revenue in 2014, with outstanding growth opportunities in the US and China, and, on completion, will ensure continued Uscom revenue growth.

The appointment of USA blood pressure and marketing specialist Stephen Wilson will be instrumental in the growth of US sales for all Uscom products, but he will be particularly focused on applying his 10 year Welch Allyn experience to the revenue opportunities of the Uscom BP+ device in the US.

Following the completion of the due diligence on, and the acquisition of, Thor, we intend to grow distribution of the Thor digital ultrasound spirometry products as each has CE and TGA approval. We will also look to rationalise manufacturing and operational efficiencies for all Uscom products which we anticipate will deliver incremental revenue and profit growth.

Uscom management is focused on becoming a multi-technology, fast growth international medical device company selling a sophisticated and profitable suite of noninvasive, sector leading technologies into world medical markets. Uscom management continues to focus on active growth strategies and optimising shareholder value, with a view to wider global expansion.”

Uscom Limited ABN 35 091 028 090 Suite 1, Level 7, 10 Loftus Street Sydney NSW 2000 Australia T +612 9247 4144 F +612 9247 8157 www.uscom.com.au

M A R K E T A N N O U N C E M E N T

About Uscom

Uscom Limited (UCM) is an ASX listed cardiovascular medical device company. Uscom is an innovative developer and manufacturer of premium cardiovascular devices and has two practice leading technologies in the field of cardiovascular monitoring, the USCOM 1A and the Uscom BP+. Devices are clinically validated with FDA, CE and TGA regulatory approval, and are currently being marketed into global distribution networks.

The USCOM 1A is a simple, cost-effective and non-invasive device that measures heart function, detects irregularities and guides treatment. The USCOM 1A device has major applications in Paediatrics, Emergency, Intensive Care Medicine and Anaesthesia, and is the device of choice for management of adult and paediatric sepsis, and for the guidance of fluid therapy.

The Uscom BP+ is a supra systolic Central Blood Pressure monitor and replaces older and more widespread sub systolic Blood Pressure monitoring technology. Central Blood Pressure is becoming the new standard of care measurement in hypertension and heart failure. The Uscom BP+ provides a highly accurate and repeatable measurement of central and brachial blood pressure and pulse pressure waveforms using a familiar upper arm cuff. The BP+ is simple to use and requires no complex training with applications in cardiology, intensive care, general practice and home care.

For more information, please visit: www.uscom.com.au

Uscom Contacts

Rob Phillips Executive Chairman rob@uscom.com.au

Catherine Officer Company Secretary secretary@uscom.com.au

Appendix 4C Quarterly report for entities admitted on the basis of commitments

Rule 4.7B

Appendix 4C

Quarterly report for entities admitted on the basis of commitments

Introduced 31/03/00 Amended 30/09/01, 24/10/05, 17/12/10

Name of entity
USCOM LIMITED
ABN 35 091 028 090	Quarter ended (“current quarter”)
35 091 028 090	30 June 2015

Consolidated statement of cash flows

	Cash flows related to operating activities 1.1 Receipts from customers 1.2 Payments for (a) staff costs (b) advertising and marketing (c) research and development (d) leased assets (e) other working capital 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes refund 1.7 Other (provide details if material) Net operating cash flows	Current quarter $A	Year to date (12.months) $A
		297,528 (231,434) (159,746) (128,257) - (136,763) - 428 - 313,050 -	1,321,080 (823,818) (540,359) (484,691) - (790,710) - 12,652 - 313,050 -
		(45,194)	(992,796)

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

	Current quarter $A	Year to date (...12...months) $A
1.8 Net operating cash flows (carried forward)	(45,194)	(992,796)
Cash flows related to investing activities 1.9 Payment for acquisition of: (a) businesses (item 5) (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets 1.10 Proceeds from disposal of: (a) businesses (item 5) (b) equity investments (c) intellectual property (d) physical non-current assets (e) other non-current assets 1.11 Loans to other entities 1.12 Loans repaid by other entities 1.13 Other (provide details if material) Net investing cash flows 1.14 Total operating and investing cash flows	- - (20,398) (6,074) - - - - - - - - (1,853)	- - (60,370) (16,612) - - - - - - - - -
	(28,325)	(76,982)
	(73,519)	(1,069,778)
Cash flows related to financing activities 1.15 Proceeds from issues of shares, options, etc. 1.16 Proceeds from sale of forfeited shares 1.17 Proceeds from borrowings 1.18 Repayment of borrowings 1.19 Dividends paid 1.20 Other (provide details if material) Private placement proceeds received in advance Share issued costs Net financing cash flows	- - - - - - - -	13,261 - - - - - - -
	-	13,261
Net increase (decrease) in cash held 1.21 Cash at beginning of quarter/year to date 1.22 Exchange rate adjustments to item 1.20 1.23 Cash at end ofquarter	(73,519) 599,836 -	(1,056,517) 1,582,834 -
	526,317	526,317

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

Payments to directors of the entity and associates of the directors

Payments to related entities of the entity and associates of the related entities

1.24 1.25	Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to the parties included in item 1.11	Current quarter $A
		56,119
		NIL
1.26	Explanation necessaryfor an understandingof the transactions
	N/A

Non-cash financing and investing activities

• 2.1 Details of financing and investing transactions which have had a material effect on consolidated assets and liabilities but did not involve cash flows

N/A

• 2.2 Details of outlays made by other entities to establish or increase their share in businesses in which the reporting entity has an interest

N/A

Financing facilities available

Add notes as necessary for an understanding of the position.

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A	Amount used $A
	NIL	NIL
	NIL	NIL

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

Reconciliation of cash

Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter $A	Previous quarter $A
4.1 Cash on hand and at bank 4.2 Deposits at call 4.3 Bank overdraft 4.4 Other (provide details) Term Deposits	485,899	559,418
	-	-
	-	-
	40,418	40,418
Total: cash at end of quarter(item 1.23)	526,317	599,836

Acquisitions and disposals of business entities

5.1 Name of entity 5.2 Place of incorporation or registration 5.3 Consideration for acquisition or disposal 5.4 Total net assets 5.5 Nature of business	Acquisitions (Item 1.9(a))	Disposals (Item 1.10(a))
	N/A	N/A
	N/A	N/A
	N/A	N/A
	N/A	N/A
	N/A	N/A

Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act (except to the extent that information is not required because of note 2) or other standards acceptable to ASX.

• 2 This statement does give a true and fair view of the matters disclosed.

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Sign here: _______ Date: 27 July 2015 (Director)

Print name: Rob Phillips

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Appendix 4C Quarterly report for entities admitted on the basis of commitments

Notes

1. The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.

2. The definitions in, and provisions of, AASB 107: Statement of Cash Flows apply to this report except for any additional disclosure requirements requested by AASB 107 that are not already itemised in this report.

3. Accounting Standards. ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

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