ALEXIUM INTERNATIONAL GROUP LIMITED
ABN 91 064 820 408
FINANCIAL REPORT
FOR THE YEAR ENDED
30 JUNE 2014
For personal use only
CONTENTS
ALEXIUM INTERNATIONAL GROUP LIMITED
Company Directory
Chairman’s Report
Directors’ Report
Corporate Governance Statement
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Audit Report
Additional Information
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COMPANY DIRECTORY
ALEXIUM INTERNATIONAL GROUP LIMITED
DIRECTORS:
COMPANY
SECRETARY:
REGISTERED AND
PRINCIPAL OFFICE:
AUDITORS:
SHARE REGISTRY:
BANKERS:
SOLICITORS:
Mr Gavin Rezos
Mr Craig Smith-Gander
Mr Nicholas Clark
Mr Cameron Maitland
Level 18 Central Park
152-158 St Georges Tce
Perth WA 6000
Telephone:
Facsimile:
+61 8 9384 3160
+61 8 6314 1623
Stantons International
Level 2, 1 Walker Ave
West Perth WA 6005
Computershare Investor Services Pty Ltd
Level 2
Reserve Bank Building
45 St Georges Terrace
PERTH WA 6000
Telephone: 1300787575
Facsimile: (08) 9323 2033
Macquarie Bank
235 St George’s Terrace
Perth WA 6000
Steinepreis Paganin
Level 4, The Read Buildings
16 Milligan Street
Perth WA 6000
ABN:
91 064 820 408
DOMICILE AND COUNTRY
OF INCORPORATION:
Australia
LEGAL FORM OF ENTITY:
Listed Public Company
SECURITY EXCHANGE:
Australian Securities Exchange (Perth) Limited
ASX Code: AJX
Frankfurt Stock Exchange
(ISIN: AU000000AJX6) (WKN A1CTT8) (E7T)
OTCQX : Ticker Code AXXIY
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CHAIRMAN’S REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
30 September 2014
Dear Shareholders
I am pleased to present your Company’s annual report for 2014 and highlight progress on
commercialisation of our environmentally
fire retardant (FR) and specialty chemical
technologies.
friendly
Over the past year we have significantly advanced the Company products base and customers
relationships in industry and government, whilst at the same time investing in additional research and
commercialisation staff, expanded our facilities, including high sensitivity equipment, whilst maintaining
a strong cash balance and strong overhead controls.
We have 2 key areas of focus, both of which have won awards for your Company, namely:
1. Environmentally friendly, cost effective FR products, independently certified for performance, for use
with nylon, polyesters and cotton blends in the apparel (defense and work wear sectors), transport
upholstery and furnishings sectors; and
2. Reactive Surface Technology (RST) for use in specialty treatments for chemical and biological
protection and heat sensitive materials.
There is ongoing development work in the area of FR additives for polymers and plastics for industrial
use including building materials and bromine FR replacement technologies. We recently received a
grant under the South Carolina Israel R&D Program for a joint project in the FR area with Israel
Chemicals Ltd under the auspices of the Office of the Chief Scientist of Israel (MAPITOP) and the
SCRA, the South Carolina State Applied Research Corporation.
US Congressman Trey Gowdy’s recent visit to our Greer operational headquarters has also
demonstrated the interest in our potential to provide safe and cost effective products to US Government
Agencies whilst adding to the South Carolina economy and we remain grateful to the SCRA for their
recognition and support.
We have commenced chemical sales for production runs in the US, Europe and Middle East/South Asia
for our FR nylon and polyester cotton blends. These relationships include one of North America’s larger
automobile fabric suppliers in the US market, ITextiles with a strong history of production with mills in
the Middle East, Pakistan and Sri Lanka and EuroFlam, a specialty finishing company based in the UK.
We expect to be able to announce further commercial relationships in the months ahead. Duro LLC is
also our North American licencee for our 95% Nylon FR treatment, AscalonTM.
We have continued our strong relationship with the US Department of Defense (DoD) with highlights
including trials on our Cleanshell CB® treatment conducted by the US Air Force using live nerve agents,
which produced outstanding results for chemical protection. Field trials by the US Marines evidenced
that our FR Nycolon treatment has additional quick drying benefits. We have also demonstrated that our
Nycolon treatments can withstand 50 Commercial launderings for the defense sector.
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CHAIRMAN’S REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
In addition, we have entered into more chemical toll production agreements in the USA to meet future
customer needs with an ability to vary production size to meet individual customer timetables. We have
obtained necessary regulatory chemical certifications for our products and export permits and are ready
logistically to meet customer demands for large chemical supplies of our FR treatments.
Your Company’s significant progress this year is due to the efforts of our senior executive team in South
Carolina comprising Nick Clark our CEO, Dr Bob Brookins (CTO) and Dr Dirk Van Hyning (Head of
Product Development) who have demonstrated strong leadership to our dedicated executives and
employees in South Carolina and Australia. Our staff continue to increase productivity and opportunity
for your Company and their interests are aligned with shareholders through appropriate risk based
performance incentives. I am grateful to see that we have developed a strong performance based
culture under Nick Clark’s stewardship.
Your Board thanks you for your continued support. We aim to deliver significant revenues in the year
ahead and enhance shareholder returns.
Yours Faithfully
Gavin Rezos
Chairman
Alexium International Group Limited
Highlights for the Year include:
July 2013
Technology breakthrough – Alexium extends flame retardant chemical treatments to polyester
blends;
South Carolina awards grant to accelerate commercialization of FR chemical treatments;
August 2013
Technical Advisory Board appointed to provide strategic input on product development, intellectual
property strategy, and commercialization path;
Independent laboratory studies certify Ascalon™ FR performance;
Alexium Nycolon™ establishes 50 wash durability;
September 2013
October 2013
Testing by US Air Force validates Alexium’s Cleanshell™ CB treatment against live chemical
Nycolon™ independent production trials;
warfare agents;
Nycolon™ FR treatment successfully commences commercial transition to production;
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CHAIRMAN’S REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
November 2013
Halogen-free FR treatment developed for nylon-cotton fabrics;
Alexium officially launches Nycolon™ and Nuvalon™ FR products for synthetic-cotton fabrics;
December 2013
Alexium makes first sale of Nycolon™ chemical treatment;
January 2014
Euroflam agreement for chemical purchase and to introduce Alexium’s products as FR treatments
on upholstery, home textiles, and contract fabrics;
Alexium partners with iTextiles®, a regional distributor of premium textile and chemical brands in
the Middle East, Pakistan and Sri Lanka;
February 2014
Placement raises $3,750,000;
March 2014
Share Purchase Plan raises $1,499,975;
The Marlin Company appointed as a second US toll manufacturer of flame retardant products;
Alexium Government Solutions introduces FR-treated fabrics to US Marine Corps program –
demonstrates that FR treatments on nylon-cotton and polyester-cotton fabrics significantly
decreases dry out time;
Expanding technical facilities and personnel to support customer requests;
Successful production scale up of proprietary FR product “Alexiflam”;
Alexium FR treatments achieve important fabric performance certifications from independent
testing laboratory - Nycolon™ and Nuvalon™ comply with ISO standard 15025 A1, (for the
industrial work wear apparel market);
Alexium receives initial iTextiles® sales revenues from first chemical shipment;
April 2014
May 2014
Alexium exhibits at Techtextil North America and launches two new products for the furnishings
market: Bactron™ and Omnitron™;
Alexium’s Nycolon™ and Nuvalon™ are independently certified to ISO 15025 B – A2 standard, (a
key performance standard for the industrial work wear market in Europe);
June 2014
Alexium’s Nycolon™ treatment receives US National ‘TechConnect’ Innovation Award;
Alexium technology reviewed at invitation-only industry day for US Army Natick Soldier RD&E
Center;
July 2014
Alexium completes production trials at Euroflam on over forty different customer fabrics;
August 2014
Alexium awarded grant by the South Carolina/Israel Collaborative Industry R&D Program for
collaboration with ICL, Inc.;
Production trials to be undertaken by a major supplier of vehicle upholstery to the North American
car manufacturers market;
September 2014
US Representative, Congressman Trey Gowdy visits Alexium facilities.
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DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
Your Directors submit their report together with the financial report of Alexium International Group
Limited (“the Company”) for the year ended 30 June 2014:
DIRECTORS
The names and details of the Company’s Directors in office during the financial year and until the date
of this report are as follows. Directors were in office for this entire year unless otherwise stated.
Mr Gavin Rezos B.Juris, LLB, BA, Executive Chairman
Mr Rezos has extensive Australian and international investment banking experience and is a former
Investment Banking Director of HSBC Group with regional roles during his HSBC career based in
London, Sydney and Dubai. Mr Rezos has held Chief Executive Officer positions and executive
directorships of companies in the technology sector in Australia, the United Kingdom, the US and
Singapore. He is currently a non-executive Director of Iluka Resources Limited, Principal of Viaticus
Capital Pty Ltd and is a member of the High Performance Oversight Committee of Rowing Australia, the
peak Olympic sports body for rowing in Australia.
Mr Craig Smith-Gander BA (Military), M.Com, Non-executive Director
Mr Smith-Gander is a graduate of the Royal Military College Duntroon and served as an officer in the
Australian Regular Army. He worked in the Offshore Group at Clough Engineering Group and was
appointed as the Group’s first Risk Manager. He has extensive investment banking and corporate
finance experience and is a former Director, Investment Banking at CIBC World Markets. Mr Smith-
Gander is now the owner and Managing Director of Kwik Transport and Crane Hire Pty Ltd.
Mr Nicholas Clark BEc, LLB, MBA, CPA, F FIN, Executive Director and CEO
Mr Clark was appointed to the board on March 18 2013. Mr Clark originally commenced with Alexium
International as the Group’s CFO and Company Secretary. Mr Clark has extensive experience in
executive management, mergers and acquisitions globally. He has held roles such as Deputy Head,
Mergers and Acquisitions, Head of Foreign Investments, and Head of Commercial and Contract
Services, in particular with CITIC, one of China’s largest resource groups.
Directorships of other listed companies during the last 3 years
Name
Company
Commenced
Ceased
Mr Gavin Rezos
Iluka Resources Ltd
Niuminco Group Limited
(formerly DSF International
Holdings Limited)
20 June 2006
10 November 2008
-
30 August 2011
Mr Craig Smith-Gander None
None
Mr Nicholas Clark
-
-
-
-
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DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
Interests in the shares and options of the Company
As at the date of this report, the interests of the Directors in the shares and options of Alexium
International Group Limited were:
Name
Number of
ordinary shares
Number of
Performance shares
Mr Gavin Rezos
Mr Craig Smith-Gander
Mr Nicholas Clark
COMPANY SECRETARY
18,694,866
585,166
2,099,900
2,500,000
-
3,000,000
Number of
options over
ordinary shares
6,500,000
1,500,000
2,000,000
Mr Cameron Maitland B.Com, CA, was appointed company secretary on 1 February 2013.
PRINCIPAL ACTIVITY
The principal activities of the entities in the group during the year were developing and licensing its
intellectual property known as Reactive Surface Treatment (RST) technology.
RESULTS AND REVIEW OF OPERATIONS
The Group’s net loss attributable to members of the Company for the financial year ended 30 June 2014
was $4,012,644 (2013: $2,599,464).
As at 30 June 2014 the cash position was $4,197,460 (2013: $1,163,231) and the Company had
202,025,435 ordinary shares on issue (2013: 149,197,632).
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Contributed equity increased by $6,680,884 (from $18,092,756 to $24,773,640) as the result of
$150,500 of convertible notes being converted to shares, options converted to shares of $126,667 and
capital raisings of $5,220,000 less capital raising costs of $403,812. There was also $100,000 of shares
issued in lieu of salary and a share purchase plan of $1,499,975. There was a share buy back of
unmarketable parcels of shares for $12,446.
DIVIDENDS
The Directors recommend that no amount be paid by way of dividend. No dividend has been paid or
declared since the start of the financial year.
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DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
UNISSUED SHARES UNDER OPTION
Unissued shares
As at the date of this report there were 19,415,000 unissued ordinary shares under option (2013:
21,290,000). Details of these options are as follows:
Date Options Granted
Expiry Date
Exercise price
of shares
Number under
option
30 November 2012
30 July 2010
21 March 2011
21 March 2011
22 June 2011
16 September 2011
31 December 2016
31 December 2014
31 December 2015
31 December 2015
21 June 2016
31 December 2015
$0.074
$0.30
$0.15
$0.25
$0.10
$0.15
4,000,000
2,500,000
6,375,000
1,000,000
540,000
5,000,000
19,415,000
Option holders do not have any right, by virtue of the option, to participate in any share issue of the
Company. 563,337 options were exercised during the financial year at $0.125 and 375,000 options
were exercised at $0.15 (2013: Nil). 1.5 million options were forfeited during the year (2013: 1.25
million) and 4,436,663 options expired during the year (2013: 7 million). During the year no options were
issued (2013: 4,000,000).
The group has 8,600,000 performance rights on issue. The performance rights were granted on 25
November 2013 and were subject to ASX approved performance criteria. The terms and conditions of
the performance rights are detailed in Note 15(c).
AFTER BALANCE DATE EVENTS
The Series A convertible notes matured on 30 August 2014 and 7,610,267 shares were issued on
conversion of 6,430,000 convertible notes. 750,000 unlisted options exercisable at $0.18 and expiring
on 31 August 2017 were issued in August 2014.
On 21 August 2014 the Company announced that it had received a grant of $250,000 from the South
Carolina/Israel Collaborative Industry R & D programme.
FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES
The Group's efforts have focused on specialty chemical solutions for a broad range of military and
commercial applications. In addition to enhancements to its patented Reactive Surface Treatment
(RST), major developments have been made in Stand-alone specialty chemical solutions for flame
retardant applications which provide an environmentally friendly technology that satisfies significant
market gaps.
The Group has focused on specific applications where its specialty chemicals solutions can clearly
enable new value-added products. The commercial roll-out of existing FR treatments and developing
other environmentally-friendly FR solutions represent the largest commercial opportunity for the Group.
In this area, the Group has the Ascalon technology (flame retardant treatment for nylon products) and
the Nycolon technology (flame retardant treatment for nylon/cotton blends). Therefore, near-term, the
Group is focused on extending these existing technologies to quickly address market needs and
generate revenues. To this end the Company has made a dedicated approach in the commercial sector
in home furnishing upholsteries and the automotive market while continuing its focus on work wear.
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DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES (continued)
This near-term focus is balanced and guided by long-term innovation and business strategies that will
address future trends and create future commercial opportunities. The Group’s strategy is to expand
the development of environmentally-friendly FR alternatives, as topical finishes or polymer additives,
and to continue to offer the capability to apply smart surface treatments using organic-inorganic hybrid
nano-composite coatings, and low temperature curing solutions.
To demonstrate the desired performance on both laboratory as well as production level product, the
Group has maintained an operation in Greer, South Carolina. With this infrastructure and by teaming
with development partners, the Group has focused on creating production ready technologies. Via
commercial development and license agreements, the Group continued to validate and transition the
technology to product manufacturers. Alexium is beginning to grow revenues by entering into
collaborative agreements with companies such as iTextiles who have a global presence in the
European and Middle East markets.
In addition to the commercial work, the Group has responded to various requests to supply RST treated
textiles to the US Department of Defense in support of tenders and technology demonstration projects.
This work will continue, particularly in the areas of FR fabrics and CB fabric treatments, understanding
that each award is made on a competitive basis and subject to transition periods.
As has been the case in the past, it is expected that the additional development work and extensions
and improvements to the existing technology will generate new patent applications, thereby extending
patent protection. The Group's research and development efforts into additional areas using the RST
technology will continue through the Cooperative Research and Development Agreement with the US
Air Force, and are primarily targeted at military programs.
ENVIRONMENTAL ISSUES
The Group’s operations are not regulated by any significant environmental regulation under a law of the
Commonwealth or of a State or Territory. The Directors have considered compliance with the National
Greenhouse and Energy Reporting Act 2007 which requires entities to report annual greenhouse gas
emissions and energy use. For the period 1 July 2013 to 30 June 2014 the Directors have asserted that
there are no current reporting requirements, but may be required to do so in the future.
REMUNERATION REPORT (AUDITED)
This report outlines the remuneration arrangements in place for Directors and Executives who are Key
Management Personnel of Alexium International Group Limited.
Director and executive details
The Directors of Alexium International Group Limited during the year were:
Mr Gavin Rezos - Executive Chairman
Mr Craig Smith - Gander – Non Executive Director
Mr Nicholas Clark - Executive Director and CEO
Other Non-Director Company Executives, during the year were:
Dr Bob Brookins – Head of Research and Development
Mr Stefan Susta – VP Sales and Marketing
Dr Dirk Van Hyning – Head of Product Development and Commercial Transition
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DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
Remuneration Policy
The Board recognises that Alexium International Group Limited (“Alexium” or “Company”) and its
subsidiaries (“Group”) operates in a global environment. To prosper, the Company must be able to
attract, motivate and retain internationally mobile Executives.
The key principles that underpin the Group’s remuneration policy are:
That rewards reflect the competitive global market in which the Group operates.
That demanding key performance indicators apply to delivering results across the Group and
to a significant portion of the total reward.
That rewards to executives be linked to the creation of value to shareholders.
That executives be rewarded for both financial and non-financial performance.
That remuneration arrangements ensure equity between executives and facilitate the
deployment of human resources.
Alexium’s reward structure combines base salary and short-term and long-term incentive plans. The
cost and value of components of the remuneration package are considered as a whole and are
fixed and variable performance-related
designed
components, linked to short-term and long-term objectives and to reflect market competitiveness.
Details of the policy applied in each component are outlined below.
to ensure an appropriate balance between
Base Salary
Base salaries are quantified by reference to the scope and nature of an individual’s role, performance
and experience. The remuneration committee actively seeks market data to benchmark salary levels.
Particular consideration is given to competitive global remuneration levels.
Salary levels are reviewed on a minimum annual basis and increased according to employee
performance and market levels.
Incentive Plans
An employee share option plan (ESOP) has been established where eligible persons are issued with
options over the ordinary shares of Alexium. The object of the plan is to assist in the recruitment,
reward, retention and motivation of employees of the Company.
Other incentive plans including partly paid shares, share purchase loans or other schemes may be
utilised to provide longer-term incentives and rewards to Executives and Directors. Shareholder
approval will be obtained in each case as required by law.
Executives are paid according to market and experience. Executive Officers are those directly
accountable for the operational management and strategic direction of the Company.
Non-Executives
In view of the significant contribution of the Non-Executive Directors and advancing the interest in the
Company by international networking, Alexium considers that the Non-Executives may continue to be
rewarded with options. It is not considered that this will significantly affect their independence in light of
their international reputation. The Non-Executive remuneration limit is $250,000, being the initial fee
allowed under clause 13.8 of the constitution approved by shareholders on 27 May 2008. Non-
Executive Directors do not receive any other retirement benefits other than a superannuation guarantee
contribution required by government regulation, which is currently 9.25% of their fees increasing to 9.5%
from 1 July 2014.
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DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
Remuneration Policy (continued)
Terms of Executive Service Agreements
The details of service agreements of the Key Management Personnel and Directors, as applicable, of
Alexium International Group Limited and the Group are as follows:
Mr Gavin Rezos, Executive Chairman
o Term: the initial term of the Service Agreement was 12 months from 29 March 2010.
o Salary: A salary of US $100,000 per year (inclusive of director’s fees). The Company may also
pay Mr Rezos additional remuneration in the form of a performance-based bonus over and
above the salary. On 25 November 2013, shareholders approved the issue of 2.5 million
Performance Rights, subject to vesting conditions.
o Termination: Mr Rezos may terminate the Service Agreement without cause upon giving 9
months written notice to the Company or 3 months notice should the Company so elect. The
Company may at its sole discretion terminate the employment without cause by giving 3
months written notice to Mr Rezos and making a payment of 9 months’ salary after the expiry
of the 3 months written notice period.
Mr Nicholas Clark, Executive Director and CEO
o The Board of Alexium has agreed to a set of conditions and a contract is being drawn up by
external lawyers.
o Place of Work: South Carolina, United States of America.
o Salary: A salary of AU$190,000 per year (inclusive of director’s fees) plus reasonable
relocation costs. On 25 November 2013, shareholders approved the issue of 3 million
Performance Rights, subject to vesting conditions.
o Termination: Mr Clark may terminate the Service Agreement without cause upon giving 6
months written notice to the Company. The Company may at its sole discretion terminate the
employment without cause by giving 6 months written notice to Mr Clark or make a payment of
6 months salary in lieu of notice.
Mr Stefan Susta, VP Sales and Marketing
o Term: the initial term of the Service Agreement is 12 months commencing on 1 August 2011
and thereafter on 6 months’ notice from either party;
o Place of Work: South Carolina, United States of America for the term of employment.
o Salary: A salary of US$165,000 per year (inclusive of director’s fees). The Company may also
pay Mr Susta additional remuneration in the form of a performance-based bonus over and
above the salary.
o Termination: Mr Susta may terminate the Service Agreement without cause upon giving 6
months written notice to the Company. The Company may at its sole discretion terminate the
employment without cause by giving 6 months written notice to Mr Susta or make a payment of
6 months salary in lieu of notice.
Dr Bob Brookins, Head of Research and Development
o Term: the initial term of the Service Agreement is 12 months commencing on 1 August 2011
and thereafter on 6 months’ notice from either party;
o Place of Work: South Carolina, United States of America for the term of employment.
o Salary: A salary of US$120,000 per year.
o Termination: Mr Brookins may terminate the Service Agreement without cause upon giving 6
months written notice to the Company. The Company may at its sole discretion terminate the
employment without cause by giving 6 months written notice to Mr Brookins or make a
payment of 6 months salary in lieu of notice.
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DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
Dr Dirk Van Hyning, Head of Product Development and Commercial Transition
o Term: the initial term of the Service Agreement is 12 months commencing on 26 April 2013
and thereafter on 6 months’ notice from either party;
o Place of Work: South Carolina, United States of America for the term of employment.
o Salary: A salary of US$112,000 per year.
o Termination: Mr Van Hyning may terminate the Service Agreement without cause upon giving
6 months written notice to the Company. The Company may at its sole discretion terminate
the employment without cause by giving 6 months written notice to Mr Van Hyning or make a
payment of 6 months salary in lieu of notice.
The following table discloses the remuneration of the Key Management Personnel being the Directors
and Executives during the financial year:
2014
Short-term benefits
Post-
employ-
ment
Termin-
ation
Benefits
Share-
based
payments
Total
Proportion
related to
performance
Remuneration
consisting of
options
And
performance
rights
Salary and
fees
$
Bonus
$
Other
benefits
$
Super-
annuation
$
$
$
%
%
Directors
Mr G Rezos(1)
Mr C Smith-Gander
Mr N Clark
Total Directors
Executives
Dr Dirk Van
Hyning(2)
Mr S Susta
Dr B Brookins
Total Executives
Total Directors and
Executives
131,887
28,125
221,226
381,238
112,796
161,162
132,600
406,558
787,796
-
-
-
-
-
-
-
-
-
-
-
65,661
65,661
14,623
19,015
16,986
50,624
925
2,602
-
3,527
-
-
-
-
116,285
3,527
-
-
-
-
-
-
-
-
-
142,395
275,207
3,023
33,750
37,315
324,202
182,733
633,159
4,975
132,394
18,624
10,968
198,801
160,554
34,567
491,749
217,300
1,124,908
-
-
-
-
-
15
9
12
4
9
7
(1)
Viaticus Capital Pty Ltd, a related party of G Rezos, also received the following:
- $11,153 (2013:$129,669) during the financial year for reimbursement of salary and wages in relation to
administration and bookkeeping personnel provided to Alexium by Viaticus of which Mr Rezos is a Director.
(2)
Dr Dirk Van Hyning was appointed on 26 April 2013.
There were no other Executives of the Company which require disclosure.
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DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
2013
Short-term benefits
Salary and
fees
$
Bonus
$
Other
benefits
$
Post-
employ-
ment
Super-
annuation
Termin-
ation
Benefits
Share-
based
payments
Total
Proportion
related to
performance
Remuneration
consisting of
options
$
$
$
%
%
Directors
Mr G Rezos(1)
Mr C Smith-Gander
Mr N Clark(2)
Total Directors
Executives
Mr J Almond(4)
Mr S Susta(3)
Dr B Brookins
Total Executives
Total Directors and
Executives
66,942
25,625
105,000
197,567
78,387
153,301
120,007
351,695
549,262
-
-
-
-
-
-
-
-
-
-
-
18,941
18,941
-
13,198
14,776
27,974
5,400
2,306
-
7,706
-
-
-
-
46,915
7,706
-
-
-
-
-
-
-
-
-
13,675
5,142
86,017
33,073
100,333
224,274
119,150
343,364
(6,941)
71,446
12,774
15,275
179,273
150,058
21,108
400,777
140,258
744,141
-
-
-
-
-
-
16
16
5
-
7
10
(1)
(2)
(3)
(4)
Viaticus Capital Pty Ltd, a related party of G Rezos, also received the following:
- $129,669 (2012:$121,608) during the financial year for reimbursement of salary and wages in relation to
administration and bookkeeping personnel provided to Alexium by Viaticus of which Mr Rezos is a Director.
Mr Clark was Company Secretary until 1 February 2013. Appointed Chief Executive Officer on 22 January 2013 and
Executive Director on 18 March 2013.
Mr Sustas was Executive Director until 18 March 2013. He resigned as Executive Director but continues to be Chief
Operating Officer.
Mr Almond resigned on 4 February 2013.
There were no other Executives of the Company which require disclosure.
Value of shares, options and performance rights issued to Directors and Executives
The Directors and Executives of the Company were issued with the following share-based remuneration
during the year:- Nil ESOP Options (2013: 4 million ESOP Options) with a value of $Nil (2013: $64,983)
and 778,210 shares (2013:1,500,000) with a value of $100,000 in lieu of salary (2013: $90,000).
7,300,000 Performance Rights were issued (2013: Nil) with a value of $168,630 (2013: Nil).
14
For personal use only
DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
Options over equity instruments granted as compensation during the year - audited
Details on options over ordinary shares in the Company that were granted as compensation to each
Key Management Personnel during the reporting period and details on options that vested during the
reporting period are as follows:
Name
Number of
options
granted
during 2014
Grant date
Vesting
date
Fair value per
option at
grant date ($)
Exercise
price per
option ($)
Expiry
date
Number of
options vested
during 2014
Directors
Mr G Rezos
Mr C Smith-
Gander
Mr Nicholas Clark
Executives
Mr D Van Hyning
Mr B Brookins
Mr S Susta
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
No options were issued in 2014
15
For personal use only
DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
Analysis of options over equity instruments granted as compensation - audited
Details of vesting profiles of the options granted as remuneration to each Key Management Personnel
of the Group and each of the three named Company executives and Group executives are detailed
below.
Name
Number
Grant date
Exercise
Price
% vested in
year
% forfeited
in year
Financial years
in which grant
vests
Directors
Mr G Rezos
Mr N Clark
Mr C Smith-Gander
2,500,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
500,000
500,000
250,000
250,000
30/7/10
16/9/11
16/9/11
30/11/12
30/11/12
21/3/11
21/33/11
16/9/11
16/9/11
30/11/12
30/11/12
Executives
Mr D Van Hyning
-
-
Mr B Brookins
Mr S Susta
1,000,000
1,000,000
1,000,000
1000,000
1,000,000
750,000
750,000
21/3/11
21/3/11
21/3/11
16/9/11
16/9/11
30/11/12
30/11/12
$0.30
$0.15
$0.15
$0.074
$0.074
$0.15
$0.15
$0.15
$0.15
$0.074
$0.074
-
$0.15
$0.15
$0.25
$0.15
$0.15
$0.074
$0.074
-
-
100%
100%
-
-
-
-
100%
100%
-
-
-
-
100%
-
100%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2011
2012
2014
2014
2015
2011
2013
2013
2014
2014
2015
-
2012
2013
2014
2013
2014
2014
2015
16
For personal use only
DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
Analysis of movements in options - audited
The movement during the reporting period, by value, of options over ordinary shares in the Company
held by each Key Management Personnel is detailed below.
Name
Granted in year
$ (A)
Value of options
exercised in year
$ (B)
Lapsed in year
$(c)
Directors
Mr G Rezos
Mr N Clark
Mr C Smith-Gander
Executives
Mr D Van Hyning
Mr B Brookins
Mr S Susta
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(A)
(B)
(C)
The value of options granted in the year is the fair value of the options calculated at grant date using the Black Scholes
option-pricing model. The total value of the options granted is included in the table above. This amount is allocated to
remuneration over the vesting period.
The value of options exercised during the year is calculated as the market price of shares of the Company as at close of
trading on the date the options were exercised after deducting the price paid to exercise the option.
The value of the options that lapsed during the year represents the benefit forgone and is calculated at the date the option
lapsed using the Black Scholes option-pricing model assuming the performance criteria had been achieved.
Performance rights over equity instruments granted as compensation during the year - audited
Details on performance rights over ordinary shares in the Company that were granted as compensation
to each Key Management Personnel during the reporting period and details on performance rights that
vested during the reporting period are as follows:
Name
Grant date
Vesting
date(1)
Number of
performance
rights
granted
during 2014
Fair value per
performance
right at grant
date ($)
Price payable
on vesting
per
performance
right ($)
Expiry
date(2)
Number of
performance
rights vested
during 2014
Directors
Mr G Rezos
Mr C Smith-
Gander
Mr Nicholas Clark
Executives
Mr D Van Hyning
Mr B Brookins
Mr S Susta
2,500,000
25/11/13
31/12/14
-
3,000,000
-
25/11/13
-
31/12/14
$0.0231
-
$0.0231
Nil
31/12/14
-
Nil
-
31/12/14
400,000
600,000
800,000
25/11/13
25/11/13
25/11/13
31/12/14
31/12/14
31/12/14-
$0.0231
$0.0231
$0.0231
Nil
Nil
Nil
31/12/14
31/12/14
31/12/14
-
-
-
-
-
-
(1) Vesting date assumed by Directors.
(2) Expiry date if vesting conditions not met.
17
For personal use only
DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
Analysis of performance rights over equity instruments granted as compensation - audited
Details of vesting profiles of the performance rights granted as remuneration to each Key Management
Personnel of the Group and each of the three named Company executives and Group executives are
detailed below.
Name
Number
Grant date
% vested in
year
% forfeited
in year
Financial years
in which grant
vests(1)
Price payable
on vesting
per
performance
right ($)
Directors
Mr G Rezos
Mr N Clark
2,500,000
25/11/13
3,000,000
25/11/13
Mr C Smith-Gander
-
-
Executives
Mr D Van Hyning
400,000
25/11/13
Mr B Brookins
600,000
25/11/13
Mr S Susta
800,000
(1) Vesting date assumed by Directors.
25/11/13
Nil
Nil
-
Nil
Nil
Nil
Analysis of movements in performance rights - audited
-
-
-
-
-
-
-
-
-
-
-
-
2015
2015
-
2015
2015
2015
The movement during the reporting period, by value, of performance rights over ordinary shares in the
Company held by each Key Management Personnel is detailed below.
Name
Granted in year
$ (A)
Value of performance
rights vested in year
$ (B)
Lapsed in year
$ (C)
Directors
Mr G Rezos
Mr N Clark
Mr C Smith-Gander
Executives
Mr D Van Hyning
Mr B Brookins
Mr S Susta
57,750
69,300
-
9,240
13,860
18,480
Nil
Nil
-
Nil
Nil
Nil
-
-
-
-
-
-
(A)
(B)
(C)
The value of performance rights granted in the year is based on the closing share price on 25 November 2013 $0.165 with a
probability discount of 80% and an unlisted status discount of 30% being applied.
The value of performance rights vested during the year is calculated as the market price of shares of the Company as at close
of trading on the date the options were vested.
The value of the performance rights that lapsed during the year represents the benefit forgone and is calculated at the date
the performance rights lapsed.
18
For personal use only
DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
Equity instrument disclosures relating to Key Management Personnel
(i)
Option holdings
The number of options over ordinary shares in the Company held during the financial year by
each Director and Executive of Alexium International Group Limited, including their personally
related parties, are set out below.
2014
Name
Balance at
start of
year
Granted during
year as
remuneration
Exercised
during
year
Number
Number
Number
Other
changes
during
year
(expired)
Number
Balance at
end of year
Options Vested
and exercisable at
end of year
Number
Number
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark
Total Directors
Executives
Mr S Susta
Dr D Van Hyning
Dr B Brookins
Total Executives
Total Directors and
Executives
6,500,000
1,500,000
2,000,000
10,000,000
3,500,000
-
3,000,000
6,500,000
16,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6,500,000
1,500,000
2,000,000
10,00,000
3,500,000
-
3,000,000
6,500,000
5,500,000
1,250,000
2,000,000
8,750,000
2,750,000
-
3,000,000
5,750,000
16,500,000
14,500,000
2013
Name
Balance at
start of
year
Granted during
year as
remuneration
Exercised
during
year
Number
Number
Number
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark(1)
Mr S Susta
Total Directors
Executives
Mr J Almond(2)
Dr B Brookins
Total Executives
Total Directors and
Executives
7,150,000
1,000,000
2,000,000
2,000,000
12,150,000
1,250,000
3,000,000
4,250,000
2,000,000
500,000
-
1,500,000
4,000,000
-
-
-
16,400,000
4,000,000
-
-
-
-
-
-
-
-
-
Other
changes
during
year
(expired)
Number
(2,650,000)
-
-
-
(2,650,000)
(1,250,000)
-
(1,250,000)
Balance at
end of year
Options Vested
and exercisable at
end of year
Number
Number
6,500,000
1,500,000
2,000,000
3,500,000
13,500,000
-
3,000,000
3,000,000
3,500,000
500,000
2,000,000
1,000,000
7,000,000
-
2,000,000
2,000,000
(3,900,000)
16,500,000
9,000,000
(1) Balance at date of appointment. Mr Clark was Company Secretary at the beginning of the year. He was
appointed as Chief Executive Officer on 22 January 2013 and Executive Director on 18 March 2013.
(2) Balance at date of resignation .
19
For personal use only
DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
(ii)
Share holdings
The number of shares in the Company held during the financial year by each Director and
Executive of Alexium International Group Limited, including their personally related parties, is set
out below.
2014
Name
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark
Total Directors
Executives
Mr S Susta
Dr D Van Hyning
Dr B Brookins
Total Executives
Total Directors and Executives
2013
Name
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark(1)
Mr S Susta
Total Directors
Executives
Mr J Almond(2)
Dr B Brookins
Mr N Clark
Mr H Alkis
Total Executives
Total Directors and
Executives
Balance at start
of year
ORDINARY
SHARES
Granted
During the
Year as
Remuneration
Received
during year
on exercise
of options
Number
Number
Number
Other
changes
during year
ORDINARY
SHARES
Number
Balance at
end of
year
ORDINARY
SHARES
Number
17,305,776
314,286
1,950,000
19,570,062
-
-
-
-
19,570,062
778,210
-
-
778,210
-
-
-
-
778,210
-
-
-
-
-
-
-
-
-
570,880
270,880
149,900
991,660
18,654,866
585,166
2,099,900
21,339,932
-
-
-
-
991,660
-
-
-
-
21,339,932
Balance at start
of year
ORDINARY
SHARES
Granted
During the
Year as
Remuneration
Received
during year
on exercise
of options
Number
Number
Number
Other
changes
during year
ORDINARY
SHARES
Number
Balance at
end of
year
ORDINARY
SHARES
Number
14,090,776
114,286
-
14,205,062
14,513,000
-
-
-
14,513,000
-
-
1,500,000
1,500,000
-
-
-
-
-
28,718,062
1,500,000
-
-
-
-
-
-
-
-
-
-
-
3,215,000
200,000
450,000
-
3,865,000
17,305,776
314,286
1,950,000
-
19,570,062
-
-
-
-
-
14,513,000
-
-
-
14,513,000
3,865,000
34,083,062
(1) Balance at date of appointment. Mr Clark was CFO and Company Secretary at the beginning of the year. He was
appointed as Chief Executive Officer on 22 January 2013 and Executive Director on 18 March 2013.
(2) Balance at date of resignation.
20
For personal use only
DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
REMUNERATION REPORT (AUDITED) (continued)
(iii)
Performance rights holdings
The number of performance rights in the Company held during the financial year by each Director
and Executive of Alexium International Group Limited, including their personally related parties, is
set out below. 7,300,000 performance rights were granted during the reporting year as
compensation (2013: Nil).
2014
Name
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark
Total Directors
Executives
Mr S Susta
Dr B Brookins
Dr D Van Hyning
Total Executives
Total Directors and Executives
DIRECTORS' MEETINGS
Balance at start
of year
PERFORMANCE
SHARES
Number
Granted
During the
Year as
Remuneration
Number
Other changes
during year
PERFORMANCE
SHARES
Balance at end
of year
PERFORMANCE
SHARES
Number
Number
-
-
-
-
-
-
-
-
-
2,500,000
-
3,000,000
5,500,000
800,000
600,000
400,000
1,800,000
7,300,000
-
-
-
-
-
-
-
-
-
2,500,000
-
3,000,000
5,500,000
800,000
600,000
400,000
1,800,000
7,300,000
The number of formal Directors’ meetings held and number of such formal meetings attended by each
of the Directors of the Company during the financial year were as follows:
The following tables set information in relation to Board meetings held during the financial year.
Board Member
Gavin Rezos
Craig Smith-Gander
Nicholas Clark
Board Meetings
held while
Director
4
4
4
Attended
4
4
4
Circular
Resolutions
Passed
1
1
1
Total
5
5
5
Dates of Formal Board Meetings and Circulating Resolutions. Note: Directors attend strategy,
continuous disclosure and staff review meetings regularly during the year but these numerous meetings
have not been recorded as formal Board meetings.
Board Meetings
24 February 2014
24 April 2014
9 May 2014
18 June 2014
Circular Resolutions
23 July 2013
21
For personal use only
DIRECTORS’ REPORT
ALEXIUM INTERNATIONAL GROUP LIMITED
INSURANCE OF OFFICERS
The Company paid a premium during the year in respect of a Director and officer liability insurance
policy, insuring the directors of the Company, the Company Secretary, and all Executive Officers of the
Company against a liability incurred as such a Director, Secretary or Executive Officer to the extent
permitted by the Corporations Act 2001. The Directors have not included details of the nature of the
liabilities covered or the amount of the premium paid in respect of the Directors’ and officers’ liability and
legal expenses’ insurance contracts, as such disclosure is prohibited under the terms of the contract.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave
to bring proceedings on behalf of the economic entity , or to intervene in any proceedings to which the
entity is a party, for the purpose of taking responsibility on behalf of the entity for all or part of those
proceedings.
No proceedings have been brought or intervened in or on behalf of the entity with leave of the Court
under section 237 of the Corporations Act 2001.
ROUNDING OFF OF AMOUNTS
Amounts in the financial statements and Directors’ report are presented in Australian dollars and all
values are rounded to the nearest dollar, unless otherwise stated.
NON-AUDIT SERVICES
During the year no non-audit services were provided by the Company’s auditor, Stantons International.
AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration is included on page 27 of the financial report.
Dated this 30th day of September 2014.
Signed in accordance with a resolution of the directors.
Gavin Rezos
Executive Chairman
22
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CORPORATE GOVERNANCE STATEMENT
ALEXIUM INTERNATIONAL GROUP LIMITED
Alexium International Group Limited is committed to best practice corporate governance, and has
reviewed all practices in line with ASX Corporate Governance Council’s principles of good corporate
governance and best practice recommendations.
Under ASX Listing Rule 4.10.3, listed companies must disclose the extent to which they have followed
the ASX Principles, and if any of the recommendations have not been followed then the Company must
explain why not.
The Company is considered a ‘micro cap’ listing, and accordingly some of the principles and
recommendations are unable to be achieved in a cost effective or practical manner, having regard for
the resources available. These issues are still considered important in our corporate governance
system, and alternate but less formal policies exist to ensure integrity in these areas. The Council
recognises that the same efficiencies experienced by larger entities may not be apparent for smaller
companies by adopting certain principles or recommendations.
Notwithstanding this, the board has made every effort to address each principle and effect suitable
policies or strategies where possible. Corporate governance information, policies and charters are
publicly available via the company’s web site.
Detailed below are comments made in relation to the company’s policies for each ASX Corporate
Governance Council principle.
Principle 1 – Lay solid foundations for management and oversight
Alexium International Group Limited supports a clear segregation of duties between management and
the board of directors.
The board has a formal charter detailing its functions, structure and responsibilities, which is available
on the Company’s website. The board delegates responsibility for the day-to-day operations and
administration of the Company to the Managing Director.
The board monitors the performance of senior management, including measuring actual performance
against planned performance.
Principle 2 – Structure the board to add value
The objective of this principle is to have a board of an effective composition, size and commitment to
adequately discharge its responsibilities and duties. As a smaller company, our aim is to achieve an
appropriate balance between the level of independence, and maintaining sufficient experience and
competence for the board to fulfil its objectives.
The board currently consists of the following directors, whose experience and expertise are detailed in
the directors’ report:
Mr Gavin Rezos Executive Chairman
Mr Nicholas Clark Executive Director and CEO
Mr Craig Smith-Gander Non-Executive Director
independent due
Not
to being a
substantial shareholder and employed in
an executive capacity.
Not independent as a member and
management involved on a day to day
basis.
Meets all criteria of independent director.
Currently only one Board member is considered to be independent.
Due to Mr Rezos not meeting the independent status, the Company is unable to meet recommendation
2.2 of the ASX Corporate Governance Council that states the chair should be an independent director.
23
For personal use only
CORPORATE GOVERNANCE STATEMENT
ALEXIUM INTERNATIONAL GROUP LIMITED
The board does not believe that restructuring the board to achieve a majority of independent directors or
for the chair to be independent would be in the best interests of shareholders, given the size and
resources of the Company at this time.
The board has not established a nomination committee as yet given its size. The board as a whole will
serve as a nomination committee in the Company’s formative period.
Principle 3 – Promote ethical and responsible decision-making
The board has established a code of conduct to promote a continued ethical and responsible decision
making process for directors and key executives. The code of conduct is publicly available via the
company’s website.
The Company has also developed and communicated a formal policy to officers and employees for
trading in the company’s shares, to complement the existing statutory restrictions such as the
Corporations Act ‘insider trading’ provisions.
Directors must advise the Company of any dealings in the Company’s shares, and the Company is
required to advise the ASX of these transactions within 5 business days.
Securities Trading by Directors and Employees
The Company adopted a Share Trading Policy on 23 December 2010. The policy summarises the law
relating to insider trading and sets out the policy of the Company on Directors, officers, employees and
consultants dealing in securities of the Company. This policy is provided to all Directors and employees
and compliance with it is reviewed on an ongoing basis in accordance with the Company’s risk
management systems.
Gender Diversity Policy
The Company does not currently have a Gender Diversity policy in place and is therefore not in
compliance with
the ASX Corporate Governance Principles and
Recommendations during the financial year. The Company does not consider it appropriate to have
such a policy at this stage of the Company’s development. The Board will continue to review the
development of the Company and will adopt a Gender Diversity Policy at the appropriate time.
recommendation 3.2 of
Principle 4 – Safeguard integrity in financial reporting
The Company does not have an audit committee, as it is considered that efficiencies would be
outweighed by the costs of its formation, given the size and resources of the company. However, the
board reviews all external audit reports to ensure appropriate action is taken by management regarding
any areas which are identified as a weakness in internal control, reviews the existing external audit
arrangements, and oversees the financial reporting process.
The Board of Directors of the Company is directly responsible for the following primary functions of an
audit committee:
(a)
(b)
(c)
(d)
(e)
(f)
ensuring appropriate Group accounting policies and procedures are defined, adopted and
maintained;
ensuring that Group operating and management reporting procedures, and the system of
internal control, are of a sufficiently high standard to provide timely, accurate and relevant
information as a sound basis for management of the Group’s business;
reviewing the Group Financial Statements and approval thereof;
reviewing the scope of work including approval of strategic and annual audit plans and
effectiveness of both the external and internal audit functions across the Group;
monitoring the proper operation of and issues raised;
ensuring that appropriate processes are in place to ensure compliance with all legal
requirements affecting the Group;
24
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CORPORATE GOVERNANCE STATEMENT
ALEXIUM INTERNATIONAL GROUP LIMITED
(g)
(h)
(i)
(j)
ensuring that all internal and industry codes of conduct and standards of corporate behaviour
are being complied with;
appointment of a person(s) responsible for Internal Audit functions as specified from time to
time;
responsible for making recommendations to the board of directors on the appointment,
reappointment or replacement (subject, if applicable, to shareholder ratification), monitoring of
effectiveness, and independence of the external auditors; and
actioning any other business processes or functions which may be referred to it by the Board of
Directors.
The board is also responsible for nomination of the external auditor and reviewing the adequacy of the
scope and quality of the annual statutory audit and half year statutory audit or review. External audit
engagement partners are rotated every 5 years.
Principle 5 – Make timely and balanced disclosure
Alexium International Group Limited is committed to ASX continuous disclosure provisions, and ensures
that all relevant information concerning the Company is made available to investors on an equal and
timely basis. Continuous disclosure is included as a recurring agenda item at each board meeting held.
The Company has incorporated a policy on continuous disclosure into its code of conduct document,
which has been promoted to all officers and employees, and is available publicly on the Company’s
website.
Principle 6 – Respect the rights of shareholders
The Company promotes active and informed shareholding, and welcomes questions from shareholders
at any time. At the Company’s annual AGM, shareholders are given every opportunity to participate at
question time, and may submit written questions to the board or auditors prior to the meeting.
The external auditor is required to attend the AGM and is available to answer any shareholder questions
regarding the conduct of the audit, and the preparation and content of the auditor’s report.
Significant company announcements are posted immediately on the company’s website.
In addition, the board has created a specific section on the Company’s website for corporate
governance information.
Principle 7 – Recognise and manage risk
The board is responsible for overseeing and assessing the effectiveness of the risk management policy.
The Chief Executive Officer and/or Managing Director is responsible for implementing the policy and
regularly reporting to the board.
In addition, risk management is a recurring agenda item at board meetings to ensure risk is considered
and managed at all times.
The Company has prepared a formal risk management document to describe policy to profile, manage,
control and assess risk.
Principle 8 – Remunerate fairly and responsibly
The board has established a Remuneration Policy as part of its Corporate Governance Policy. The
board has decided at this time not to establish a separate remuneration committee due to the current
size of the entity and its operations. Therefore the board will be responsible for determining and
reviewing compensation arrangements for the directors themselves and the chief executive officer and
the executive team. The board will in due course establish a remuneration committee, comprising two
directors and operating under a board approved terms of reference.
25
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CORPORATE GOVERNANCE STATEMENT
ALEXIUM INTERNATIONAL GROUP LIMITED
The Company has prepared a formal charter which sets out the role and responsibilities of the board
and has established a remuneration policy. Both the charter and remuneration policy are publicly
available via the Company’s website.
Non-executive Directors are remunerated by way of fees, which is clearly distinguished from the
remuneration for Executive Directors and Senior Executives. The Company does not have any schemes
for retirement benefits, other than statutory superannuation.
26
For personal use only
For personal use only CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
Note
3
16(d)
4
3
6
Revenue from continuing operations
Cost of goods sold
Employee benefits expense
Depreciation and amortisation
Research and development
Interest and amortisation of cost of raising
convertible notes
Share-based payments
Other expenses
Net operating loss for the year
Finance income
Loss before income tax
Income tax credit (Research and
Development Rebate)
Income tax (expense)/benefit
Loss for the year
Other comprehensive income, net of
income tax.
Items that may be reclassified to profit or
loss.
- Exchange differences on
translation of foreign operations
Items that will not be reclassified to profit
or loss
Consolidated Group
2014
$
242,465
(77,924)
(1,362,274)
(787,329)
(713,537)
(287,915)
(233,481)
(1,015,376)
(4,235,371)
2013
$
365,380
(158,187)
(948,074)
(838,143)
-
(194,543)
(156,084)
(995,376)
(2,925,027)
19,042
29,799
(4,216,329)
(2,895,228)
-
203,685
92,079
203,685
(4,012,644)
(2,599,464)
(124,552)
76,959
-
-
Total comprehensive loss for the year
(4,137,196)
(2,522,505)
Loss for the year attributable to members
of the group
Total comprehensive loss for the year
attributable to members of the group
(4,012,644)
(2,599,464)
(4,137,196)
(2,522,505)
Basic loss per share (cents)
7
(2.26)
(1.82)
Diluted loss per share (cents)
This consolidated statement of profit or loss and other comprehensive income should be read in
conjunction with the accompanying notes to the financial statements.
(2.26)
(1.82)
7
28
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
Current Assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total Current Assets
Non-Current Assets
Other financial assets
Property, plant and equipment
Intangible assets
Total Non-Current Assets
Total Assets
Current Liabilities
Trade and other payables
Provisions
Convertible Notes
Other - deferred income
Total Current Liabilities
Non-Current Liabilities
Convertible Notes
Deferred tax liability
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Contributed equity
Reserves
Accumulated losses
Total Equity
Note
19(a)
8
9
10
11
12
14
13
14
6(b)
15
17
18
Consolidated Group
2014
$
2013
$
4,197,460
70,975
103,661
4,372,096
5,402
343,142
9,052,124
9,400,668
1,163,231
22,566
96,404
1,282,201
4,483
293,111
9,679,524
9,977,118
13,772,764
11,259,319
189,680
18,749
636,181
63,564
908,174
128,228
32,986
-
-
161,214
930,039
2,580,008
3,510,047
1,637,038
2,783,693
4,420,731
4,418,221
4,581,945
9,354,543
6,677,374
24,773,640
523,678
(15,942,775)
9,354,543
18,092,756
514,749
(11,930,131)
6,677,374
This consolidated statement of financial position should be read in conjunction with the
accompanying notes to the financial statements.
29
For personal use only
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
Balance at 1 July 2013
Loss for the year
Foreign currency translation
Total comprehensive loss for the
year
Transactions with owners in their
capacity as owners:
Issued capital
Capital raising costs
Share buy back of unmarketable
parcels
Options exercised
Share-based payment
Shares issued in lieu of salary
Balance at 30 June 2014
Contributed equity
Reserves
$
18,092,756
$
514,749
Accumulated
losses
$
(11,930,131)
Total
$
6,677,374
(4,012,644)
(124,552)
-
-
-
6,870,475
(403,812)
(12,446)
126,667
-
100,000
24,773,640
-
(124,552)
(4,012,644)
-
(124,552)
(4,012,644)
(4,137,196)
-
-
-
-
133,481
-
523,678
-
-
-
-
-
-
(15,942,775)
6,870,475
(403,812)
(12,446)
126,667
133,481
100,000
9,354,543
Contributed equity
Reserves
Balance at 1 July 2012
Loss for the year
Foreign currency translation
Total comprehensive loss for the
year
Transactions with owners in their
capacity as owners:
Issued capital net of transaction
costs
Share based payment capital
raising costs
Performance Shares cancelled as
performance milestones not met-
transferred to accumulated losses
Convertible note equity component
Options exercised
Share-based payment
Shares issued in lieu of salary
Balance at 30 June 2013
$
19,701,756
(52)
-
(52)
402,000
(6,000)
(2,099,948)
-
-
5,000
90,000
18,092,756
Accumulated
losses
$
(11,430,615)
Total
$
8,573,652
(2,599,464)
-
(2,599,516)
76,959
$
302,511
-
76,959
76,959
(2,599,464)
(2,522,557)
-
-
74,196
-
61,083
-
514,749
-
-
2,099,948
-
-
-
-
(11,930,131)
402,000
(6,000)
-
74,196
-
66,083
90,000
6,677,374
This consolidated statement of changes in equity should be read in conjunction with the
accompanying notes to the financial statements.
30
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CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
Consolidated Group
2014
$
2013
$
Note
Cash flow from operating activities
Receipts from customers
Other Income
Payments to suppliers and employees
Interest received
Goods & services tax (paid)/received from ATO
256,056
-
(3,205,902)
19,042
60,826
314,700
93,329
(2,081,088)
29,799
51,631
Net cash flows (used in) operating activities
19(b)
(2,869,978)
(1,591,629)
Cash flows from investing activities
Increase in intangibles
Purchase of property, plant and equipment
Deposits paid
(51,602)
(83,079)
(1,093)
(22,525)
(60,277)
-
Net cash flows (used in) investing activities
(135,774)
(82,802)
Cash flows from financing activities
Proceeds from issue of ordinary shares
Payment of share issue costs
Convertible notes
Costs of convertible note raised
Convertible notes interest paid
Payment for unmarketable parcel share buy back
Net cash flows from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Effect of exchange rate changes on cash and cash
equivalents
6,846,642
(403,812)
-
-
(208,233)
(12,446)
6,222,151
3,216,399
-
(6,000)
2,200,000
(157,326)
(123,984)
-
1,912,690
238,259
1,163,231
906,658
(182,170)
18,314
Cash and cash equivalents at end of year
This consolidated statement of cash flows should be read in conjunction with the accompanying
notes to the financial statements.
4,197,460
19(a)
1,163,231
31
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
1. CORPORATE INFORMATION
Alexium International Group Limited (“the Company”) is a company limited by shares
incorporated and domiciled in Australia, whose shares are publicly traded on the Australian
Securities Exchange and Frankfurt Stock Exchange. Alexium commenced trading on the OTC
markets prestigious tier, OTCQX International on January 13 2012. These financial statements
include the consolidated financial statements and notes of Alexium International Group Limited
and controlled entities (‘Group’) and are presented in Australian dollars.
The financial report was authorised for issue by the Directors on 30 September 2014 in
accordance with a resolution of the Directors.
The nature of the operations and principal activities of the Group are described in the Directors’
Report.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation
These financial statements are general purpose financial statements that have been prepared in
accordance with Accounting Standards, Australian Accounting Interpretations, other authoritative
pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001.
Australian Accounting Standards set out accounting policies that the AASB has concluded would
result in financial statements containing relevant and reliable information about transactions,
events and conditions to which they apply. Compliance with Australian Accounting Standards
ensures that the financial statements and notes also comply with International Financial
Reporting Standards as issued by the International Accounting Standards Board. Material
accounting policies adopted in the preparation of the financial statements are presented below.
They have been consistently applied unless otherwise stated.
The financial statements have been prepared on an accruals basis and are based on historical
costs modified, where applicable by the measurement at fair value of selected non-current
assets, financial assets and financial liabilities. The presentation and functional currency is
Australian Dollars.
Separate financial statements for the Company as an individual entity are no longer presented as
the consequence of a change to the Corporations Act 2001, however, required financial
information for the Company as an individual entity is included in Note 24.
(b) New standards and interpretations Adopted in 2013/14 FY
The Group has adopted the following new standards and amendments to standards, including
any consequential amendments to other standards, with a date of initial application of 1 January
2013.
AASB 10: Consolidated Financial Statements;
AASB 11: Joint Arrangements;
AASB 12: Disclosure of Interests in Other Entities;
AASB 13: Fair Value Measurement;
AASB 119: Employee Benefits; and
AASB 127: Separate Financial Statements
32
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(b) New Standards and Interpretations Adopted in 2013/14FY (continued)
Account Standard and Interpretation
AASB 10 ‘Consolidated Financial Statements’ and AASB 2011-7 ‘Amendments to Australian
Accounting Standards arising from the Consolidation and Joint Arrangements standards’
it has power over an investee;
it is exposed, or has rights, to variable returns from its involvement with the investee; and
has the ability to use its power to affect its returns.
AASB 10 replaces the parts of AASB 127 ‘Consolidated and Separate Financial Statements’ that
deal with consolidated financial statements and provides a revised definition of “control” such that
an investor controls an investee when:
a)
b)
c)
All three of these criteria must be met for an investor to have control over an investee. This may
result in an entity having to consolidate an investee that was not previously consolidated and/or
deconsolidate an
the previous accounting
that was consolidated under
pronouncements.
There have been no changes to the treatment of investees compared to prior year.
investee
AASB 11 ‘Joint Arrangements’ and AASB 2011-7 ‘Amendments to Australian Accounting
Standards arising from the Consolidation and Joint Arrangements standards’
AASB 11 replaces AASB 131 ‘Interests in Joint Ventures. AASB 11 deals with how a joint
arrangement of which two or more parties have joint control should be classified and accounted
for. Under AASB 11, there are only two types of joint arrangements – joint operations and joint
ventures. The classification of joint arrangements under AASB 11 is determined based on the
rights and obligations of parties to the joint arrangements by considering the structure, the legal
form of the arrangements, the contractual terms agreed by the parties to the arrangement, and,
when relevant, other facts and circumstances.
Application of this standard has not impacted on the financial statements of the Group.
AASB 12 ‘Disclosure of Interests in Other Entities’ and AASB 2011-7 ‘Amendments to Australian
Accounting Standards arising from the consolidation and Joint Arrangements standards’
AASB 12 is a new disclosure standard and is applicable to entities that have interests in
subsidiaries, joint arrangements, associates and/or unconsolidated structured entities. In general,
the application of AASB 12 has resulted in more extensive disclosures in the consolidated
financial statements.
AASB 13 ‘Fair Value Measurement’ and AASB 2011-8 ‘Amendments to Australian Accounting
Standards arising from AASB 13’
33
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(b) New Standards and Interpretations Adopted in 2013/14FY (continued)
AASB 13 ‘Fair Value Measurement’ and AASB 2011-8 ‘Amendments to Australian Accounting
Standards arising from AASB 13’
The Group has applied AASB 13 for the first time in the current year. AASB 13 establishes a
single source of guidance for fair value measurements and disclosures about fair value
measurements. The scope of AASB 13 is broad; the fair value measurement requirements of
AASB 13 apply to both financial instrument items and non-financial instrument items for which
other AASBs require or permit fair value measurements and disclosures about fair value
measurements, except for share based payment transactions that are within the scope of AASB
2 ‘Share-based Payment’, leasing transactions that are within the scope of AASB 117 ‘Leases’,
and measurements that have some similarities to fair value but are not fair value (e.g. net
realisable value for the purposes of measuring inventories or value in use for impairment
assessment purposes).
AASB 119 ‘Employee Benefits’ (2011) and AASB 2011-10 ‘Amendments to Australian
Accounting Standards arising from AASB 119 (2011)’
AASB 119 (as revised in 2011) changes the accounting for defined benefit plans and termination
benefits. The most significant change relates to the accounting for changes in defined benefit
obligations and plan assets.
Application of AASB 119 Employee Benefits has not impacted on the financial statements for the
year ended 30 June 2014.
Interests in Joint Arrangements
Joint arrangements represent the contractual sharing of control between parties in a business
venture where unanimous decisions about relevant activities are required.
Separate joint venture entities providing joint venturers with an interest to net assets are
classified as a "joint venture" and accounted for using the equity method.
Joint venture operations represent arrangements whereby joint operators maintain direct
interests in each asset and exposure to each liability of the arrangement. The Group's interests in
the assets, liabilities, revenue and expenses of joint operations are included in the respective line
items of the consolidated financial statements.
Gains and losses resulting from sales to a joint operation are recognised to the extent of the
other parties' interests. When the Group makes purchases from a joint operation, it does not
recognise its share of the gains and losses from the joint arrangement until it resells those
goods/assets to a third party.
34
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(b) New Standards and Interpretations Adopted in 2013/14FY (continued)
Fair Value of Assets and Liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or non-
recurring basis, depending on the requirements of the applicable Accounting Standard.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a
liability in an orderly (ie unforced) transaction between independent, knowledgeable and willing
market participants at the measurement date.
As fair value is a market-based measure, the closest equivalent observable market pricing
information is used to determine fair value. Adjustments to market values may be made having
regard to the characteristics of the specific asset or liability. The fair values of assets and
liabilities that are not traded in an active market are determined using one or more valuation
techniques. These valuation techniques maximise, to the extent possible, the use of observable
market data.
To the extent possible, market information is extracted from either the principal market for the
asset or liability (ie the market with the greatest volume and level of activity for the asset or
liability) or, in the absence of such a market, the most advantageous market available to the
entity at the end of the reporting period (ie the market that maximises the receipts from the sale
of the asset or minimises the payments made to transfer the liability, after taking into account
transaction costs and transport costs).
For non-financial assets, the fair value measurement also takes into account a market
participant's ability to use the asset in its highest and best use or to sell it to another market
participant that would use the asset in its highest and best use.
The fair value of liabilities and the entity's own equity instruments (excluding those related to
share-based payment arrangements) may be valued, where there is no observable market price
in relation to the transfer of such financial instruments, by reference to observable market
information where such instruments are held as assets. Where this information is not available,
other valuation techniques are adopted and, where significant, are detailed in the respective note
to the financial statements.
Valuation techniques
In the absence of an active market for an identical asset or liability, the Group selects and uses
one or more valuation techniques to measure the fair value of the asset or liability, The Group
selects a valuation technique that is appropriate in the circumstances and for which sufficient
data is available to measure fair value. The availability of sufficient and relevant data primarily
depends on the specific characteristics of the asset or liability being measured. The valuation
techniques selected by the Group are consistent with one or more of the following valuation
approaches:
-
-
-
Market approach: valuation techniques that use prices and other relevant information
generated by market transactions for identical or similar assets or liabilities.
Income approach: valuation techniques that convert estimated future cash flows or
income and expenses into a single discounted present value.
Cost approach: valuation techniques that reflect the current replacement cost of an
asset at its current service capacity.
35
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(b) New Standards and Interpretations Adopted in 2013/14FY (continued)
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers
would use when pricing the asset or liability, including assumptions about risks. When selecting a
valuation technique, the Group gives priority to those techniques that maximise the use of
observable inputs and minimise the use of unobservable inputs. Inputs that are developed using
market data (such as publicly available information on actual transactions) and reflect the
assumptions that buyers and sellers would generally use when pricing the asset or liability are
considered observable, whereas inputs for which market data is not available and therefore are
developed using the best information available about such assumptions are considered
unobservable.
Fair value hierarchy
AASB 13 requires the disclosure of fair value information by level of the fair value hierarchy,
which categorises fair value measurements into one of three possible levels based on the lowest
level that an input that is significant to the measurement can be categorised into as follows:
Level 1
Measurements based on quoted prices (unadjusted) in active markets for identical assets or
liabilities that the entity can access at the measurement date.
Measurements based on inputs other than quoted prices included in Level 1 that are observable
for the asset or liability, either directly or indirectly.
Level 2
Measurements based on inputs other than quoted prices included in Level 1 that are observable
for the asset or liability, either directly or indirectly
Level 3
Measurements based on unobservable inputs for the asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined
using one or more valuation techniques. These valuation techniques maximise, to the extent
possible, the use of observable market data. If all significant inputs required to measure fair value
are observable, the asset or liability is included in Level 2. If one or more significant inputs are
not based on observable market data, the asset or liability is included in Level 3.
The Group would change the categorisation within the fair value hierarchy only in the following
circumstances:
if a market that was previously considered active (Level 1) became inactive (Level 2 or
Level 3) or vice versa; or
if significant inputs that were previously unobservable (Level 3) became observable
(Level 2) or vice versa.
When a change in the categorisation occurs, the Group recognises transfers between levels of
the fair value hierarchy (i.e. transfers into and out of each level of the fair value hierarchy) on the
date the event or change in circumstances occurred.
36
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(b) New Standards and Interpretations Adopted in 2013/14FY (continued)
New standards and interpretations not yet adopted
A number of new standards, amendments to standards and interpretations issued by the AASB
which are not yet mandatorily applicable to the Group have not been applied in preparing these
consolidated financial statements. Those which may be relevant to the Group are set out below.
The Group does not plan to adopt these standards early.
AASB 9 Financial Instruments and associated Amending Standards (applicable for annual
reporting period commencing 1 January 2017)
AASB 9 (2009) introduces new requirements for the classification and measurement of
financial assets. Under AASB 9, financial assets are classified and measured based on the
business model in which they are held and the characteristics of their contractual cash flows.
The 2010 revisions introduce additional changes relating to financial liabilities.
The Standard will be applicable retrospectively (subject to the comment on hedge
accounting below) and includes revised requirements for the classification and measurement
of financial instruments, revised recognition and derecognition requirements for financial
instruments and simplified requirements for hedge accounting.
Key changes made to this standard that may affect the Group on initial application include
certain simplifications to the classification of financial assets, simplifications to the
accounting of embedded derivatives, and the irrevocable election to recognise gains and
losses on investments in equity instruments that are not held for trading in other
comprehensive income. AASB 9 also introduces a new model for hedge accounting that will
allow greater flexibility in the ability to hedge risk, particularly with respect to hedges of non-
financial items. Should the entity elect to change hedge policies in line with the new hedge
accounting requirements of AASB 9, the application of such accounting would be largely
prospective.
Although the directors anticipate that the adoption of AASB 9 may have an impact on the
Group’s financial instruments, including hedging activity, it is impractical at this stage to
provide a reasonable estimate of such impact.
37
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(b) New Standards and Interpretations Adopted in 2013/14FY (continued)
Other standards not yet applicable
These standards are not expected to have a material impact on the entity in the current or
future reporting periods.
Standard/Interpretation
Effective for annual
reporting periods
beginning on or after
Expected to be initially
applied in the financial
year ending
AASB 1031 ‘Materiality’ (2013)
1 January 2014
30 June 2015
AASB 2012-3 ‘Amendments to Australian
Accounting Standards – Offsetting Financial Assets and
Financial Liabilities’
AASB 2013-3 ‘Amendments to AASB 136 – Recoverable
Amount Disclosures for Non-Financial Assets’
AASB 2013-4 ‘Amendments to Australian Accounting
Standards – Novation of Derivatives and Continuation of
Hedge Accounting
AASB 2013-5 ‘Amendments to Australian Accounting
Standards – Investment Entities
AASB 2013-9 ‘Amendments to Australian Accounting
Standards – Conceptual Framework, Materiality and
Financial Instruments’
(c) Principles of Consolidation
1 January 2014
30 June 2015
1 January 2014
30 June 2015
1 January 2014
30 June 2015
1 January 2014
30 June 2015
1 January 2014
30 June 2015
The consolidated financial statements incorporate all of the assets, liabilities and results of the
parent, Alexium International Group Limited and all of the subsidiaries. Subsidiaries are entities
the parent controls. The parent controls an entity when it is exposed to, or has rights to, variable
returns from its involvement with the entity and has the ability to affect those returns through its
power over the entity. A list of the subsidiaries is provided in Note 21.
The assets, liabilities and results of all subsidiaries are fully consolidated into the financial
statements of the Group from the date on which control is obtained by the Group. The
consolidation of a subsidiary is discontinued from the date that control ceases. Intercompany
transactions, balances and unrealised gains or losses on transactions between Group entities
are fully eliminated on consolidation. Accounting policies of subsidiaries have been changed and
adjustments made where necessary to ensure uniformity of the accounting policies adopted by
the Group.
Equity interests in a subsidiary not attributable, directly or indirectly, to the Group are presented
as “non controlling interests". The Group initially recognises non-controlling interests that are
present ownership interests in subsidiaries and are entitled to a proportionate share of the
subsidiary's net assets on liquidation at either fair value or at the non-controlling interests'
proportionate share of the subsidiary's net assets. Subsequent to initial recognition, non-
controlling interests are attributed their share of profit or loss and each component of other
38
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(c) Principles of Consolidation (continued)
comprehensive income. Non-controlling interests are shown separately within the equity section
of the statement of financial position and statement of comprehensive income.
(d) Foreign currency translation
The functional and presentation currency of Alexium International Group Limited is Australian
dollars ($AUD). The functional currencies of its overseas subsidiaries are the Pound Sterling and
the United States Dollar.
Transactions in foreign currencies are initially recorded in the functional currency at the exchange
rates ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies are retranslated at the rate of exchange ruling at the balance sheet date.
All differences in the consolidated financial report are taken to the statement of comprehensive
income. These are taken directly to equity until the disposal of the net investment, at which time
they are recognised in the statement of comprehensive income.
Tax charges and credits attributable to exchange differences on those borrowings are also
recognised in equity.
Non-monetary items that are measured in terms of historical cost in a foreign currency are
translated using the exchange rates as at the date of the initial transaction.
Non-monetary items measured at fair value in a foreign currency are translated using the
exchange rates at the date when the fair value was determined.
As at the reporting date the assets and liabilities of these overseas subsidiaries are translated
into the presentation currency of Alexium International Group Limited at the rate of exchange
ruling at the balance sheet date and the statements of comprehensive income are translated at
the weighted average exchange rates for the year.
The exchange differences arising on the retranslation are taken directly to a separate component
of equity.
On disposal of a foreign entity, the deferred cumulative amount recognised in equity relating to
that particular foreign operation is recognised in the profit or loss.
(e) Property, plant and equipment
(i) Owned assets
Items of property, plant and equipment are stated at cost or deemed cost less accumulated
depreciation (see below) and impairment losses (see accounting policy (g)).
Where parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items of property, plant and equipment.
(ii) Leased assets
Leases in terms of which the consolidated entity assumes substantially all the risks and rewards of
ownership are classified as finance leases. These finance leases are stated at an amount equal to
39
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(e) Property, plant and equipment (continued)
the lower of its fair value and the present value of the minimum lease payments at inception of the
lease. Lease payments are accounted for as described in accounting policy (l).
Leases in which a significant portion of the risks and rewards of ownership are not transferred to the
consolidated entity are classified as operating leases. Payments made under operating leases are
charged to the profit and loss on a straight-line basis over the period of the lease.
(iii) Subsequent costs
The consolidated entity recognises in the carrying amount of an item of property, plant and
equipment the cost of replacing part of such an item when that cost is incurred if it is probable
that the future economic benefits embodied within the item will flow to the consolidated entity and
the cost of the item can be measured reliably. All other costs are recognised in profit or loss as
an expense as incurred.
(iv) Depreciation
Depreciation is charged to the consolidated statement of profit or loss and other comprehensive
income on a straight-line basis over the estimated useful lives of each part of an item of property,
plant and equipment.
The estimated useful lives in the current and comparative years are as follows:
Plant and equipment
Leased plant and equipment
over 3 to 50 years
over 3 to 50 years
The residual value, the useful life and the depreciation method applied to an asset are
reassessed at least annually.
(f) Intangible assets
(i) Goodwill
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to
cash-generating units and is no longer amortised but is tested annually for impairment.
(ii) Acquired both separately and from a business combination
Intangible assets acquired separately are capitalised at cost and from a business combination
are capitalised at fair value as at the date of acquisition. Following initial recognition, the cost
model is applied to the class of intangible assets.
The useful lives of these intangible assets are assessed to be either finite or indefinite. Where
amortisation is charged on assets with finite lives, this expense is taken to the income statement.
Intangible assets, excluding development costs, created within the business are not capitalised
and expenditure is charged against the income statement in the year in which the expenditure is
incurred.
Intangible assets are tested for impairment where an indicator of impairment exists, and in the
case of indefinite life intangibles annually, either individually or at the cash generating unit level
40
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(f) Intangible assets (continued)
(see accounting policy (g)). Useful lives are also examined on an annual basis and adjustments,
where applicable, are made on a prospective basis.
(iii) Other intangible assets
Other intangible assets that are acquired by the consolidated entity are stated at cost less
accumulated amortisation (see below) and impairment losses (see accounting policy (g)).
Expenditure on internally generated goodwill and brands is recognised in the statement of
comprehensive income as an expense as incurred.
(iv) Subsequent expenditure
Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the
future economic benefits embodied in the specific asset to which it relates. All other expenditure
is expensed as incurred.
(v) Amortisation
A summary of the policies applied to the consolidated entity's intangible assets is as follows:
Goodwill and intangible assets with an indefinite life are systematically tested for impairment at
each balance sheet date. Capitalised development costs and patents and trademarks with a
finite life are amortised as follows:
-
Patents and Trademarks:
Lesser of 17 years or average remaining life of patents
and trademarks
- Capitalised development costs: Over future periods on a basis related to expected future
benefits
Amortisation methods, useful lives and residual values are reviewed at each financial year-end
and adjusted as appropriate.
Gains or losses arising from derecognition of an intangible asset are measured as the difference
between the net disposal proceeds and the carrying amount of the asset and are recognised in
the profit or loss when the asset is derecognised.
(g) Impairment of assets
At each reporting date, the Group assesses whether there is any indication that an asset may be
impaired. Where an indicator of impairment exists, the Group makes a formal estimate of
recoverable amount. Where the carrying amount of an asset exceeds its recoverable amount the
assets is considered impaired and is written down to its recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. It is
determined for an individual asset, unless the asset’s value in use cannot be estimated to be
close to its fair value less cost to sell and it does not generate cash inflows that are largely
independent of those from other assets or groups of assets, in which case, the recoverable
amount is determined for the cash-generating unit to which the asset belongs.
41
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(g) Impairment of assets (continued)
In assessing value in use, the estimated future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market assessments of the time value of money
and the risks specific to the asset.
(h) Trade and other receivables
Trade receivables, which generally have 30-120 day terms, are recognised and carried at original
invoice amount less an allowance for any uncollectible amounts.
An estimate for doubtful debts is made when collection of the full amount is no longer probable.
Bad debts are written off when identified.
(i) Determination and presentation of operating segments
The Company has applied AASB 8 Operating Segments from 1 July 2009. AASB 8 requires a
‘management approach’ under which segment information is presented on the same basis as
that used for internal reporting purposes.
An operating segment is a component of the Group that engages in business activities from
which it may earn revenues and incur expenses, including revenues and expenses that relate to
transactions with any of the Group’s other components. An operating segment’s operating results
are reviewed regularly by the Board to make decisions about resources to be allocated to the
segment and assess its performance, and for which discrete financial information is available.
The Board considers the business from both a product and a geographical perspective and takes
the view that the Company operates under one operating segment.
(j) Cash and cash equivalents
Cash and short-term deposits in the balance sheet comprise cash at bank and in hand and short-
term deposits with an original maturity of three months or less.
For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash and
cash equivalents as defined above, net of outstanding bank overdrafts.
(k) Trade and other receivables
Trade receivables, which generally have 30-90 day terms, are recognised and carried at original
invoice amount less an allowance for any uncollectible amounts.
An estimate for doubtful debts is made when collection of the full amount is no longer probable.
Bad debts are written off when identified.
42
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(l) Leases
Finance leases, which transfer to the Group substantially all the risks and benefits incidental to
ownership of the leased item, are capitalised at the inception of the lease at the fair value of the
leased property or, if lower, at the present value of the minimum lease payments. Lease
payments are apportioned between the finance charges and reduction of the lease liability so as
to achieve a constant rate of interest on the remaining balance of the liability. Finance charges
are charged directly against income. Capitalised leased assets are depreciated over the shorter
of the estimated useful life of the asset or the lease term. Leases where the lessor retains
substantially all the risks and benefits of ownership of the asset are classified as operating
leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying
amount of the leased asset and recognised over the lease term on the same bases as the lease
income. Operating lease payments are recognised as an expense in the income statement on a
straight-line basis over the lease term.
(m) Investments
All investments are initially recognised at cost, being the fair value of the consideration given and
including acquisition charges associated with the investment. After initial recognition, investments
which are classified as held for trading and available-for-sale are measured at fair value. Gains
and losses on investments held for trading are recognised in the statement of comprehensive
income.
Gains or losses on available-for-sale investments are recognised as a separate component of
equity until the investment is sold, collected or otherwise disposed of, or until the investment is
determined to be impaired, at which time cumulative gain or loss previously reported in equity is
included in the profit or loss.
For investments that are actively traded in organised financial markets, fair value is determined
by reference to Stock Exchange quoted market bid prices as the close of business on the
statement of financial position date.
(n) Trade and other payables
Trade payables and other payables are carried at amortised cost. They represent liabilities for
goods and services provided to the Group prior to the end of the financial year that are unpaid
and arise when the Group becomes obliged to make future payments in respect of the purchase
of these goods and services. The amounts are unsecured and are usually paid within 60 days of
recognition.
(o) Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a
result of a past event, it is probable that an outflow of resources embodying economic benefits
will be required to settle the obligation and a reliable estimate can be made of the amount of the
obligation.
Where the Group expects some or all of a provision to be reimbursed, for example under an
insurance contract, the reimbursement is recognised as a separate asset but only when the
reimbursement is virtually certain. The expense relating to any provision is presented in the
statement of comprehensive income, net of any reimbursement.
43
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(o) Provisions (continued)
If the effect of the time value of money is material, provisions are determined by discounting the
expected future cash flows at a pre-tax rate that reflects current market assessments of the time
value of money and, where appropriate, the risks specific to the liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised
as a finance cost.
(p) Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of
new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
(q) Revenue recognition
Revenue is recognised and measured at the fair value of the consideration received or receivable
to the extent it is probable that the economic benefits will flow to the Group and the revenue can
be reliably measured. The following specific recognition criteria must also be met before revenue
is recognised:
Sale of goods
Revenue is recognised when the significant risks and rewards of ownership of the goods have
passed to the buyer and the costs incurred or to be incurred in respect of the transaction can be
measured reliably. Risks and rewards of ownership are considered passed to the buyer at the
time of delivery of the goods to the customer.
Interest income
Revenue is recognised as interest accrues using the effective interest method. This is a method
of calculating the amortised cost of a financial asset and allocating the interest income over the
relevant year using the effective interest rate, which is the rate that exactly discounts estimated
future cash receipts through the expected life of the financial asset to the net carrying amount of
the financial asset.
(r) Income tax and other taxes
Deferred income tax is provided on all temporary differences at the statement of financial position
date between the tax bases of assets and liabilities and their carrying amounts for the financial
reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences:
except where the deferred income tax liability arises from the initial recognition of an asset
or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profit nor taxable profit or loss; and
in respect of taxable temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, except where the timing of the reversal of the
temporary differences can be controlled and it is probable that the temporary differences
will not reverse in the foreseeable future.
44
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(r) Income tax and other taxes (continued)
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward
of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will
be available against which the deductible temporary differences, and the carry-forward of unused
tax assets and unused tax losses can be utilised:
except where the deferred income tax asset relating to the deductible temporary
differences arises from the initial recognition of an asset or liability in a transaction that is
not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; and
in respect of deductible temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, deferred tax assets are only recognised to the
extent that it is probable that the temporary differences will reverse in the foreseeable
future and taxable profit will be available against which the temporary differences can be
utilised.
The carrying amount of deferred income tax assets is reviewed at each statement of financial
position date and reduced to the extent that it is no longer probable that sufficient taxable profit
will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to
apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax
laws) that have been enacted or substantively enacted at the statement of financial position date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in
the statement of comprehensive income.
Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
where the GST incurred on a purchase of goods and services is not recoverable from the
taxation authority, in which case the GST is recognised as part of the cost of acquisition of
the asset or as part of the expense item as applicable; and
receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part
of receivables or payables in the statement of financial position.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST
component of cash flows arising from investing and financing activities, which is recoverable
from, or payable to, the taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or
payable to, the taxation authority.
(s) Earnings per share
Basic earnings per share is calculated by dividing the net profit attributable to members of the
parent entity for the reporting year, after excluding any costs of servicing equity (other then
ordinary shares and converting preference shares classified as ordinary shares of EPS
calculation purposes), by weighted average number of ordinary shares of the Company, adjusted
for any bonus issue.
45
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(t) Business combinations
The acquisition method of accounting is used to account for all business combinations, including
business combinations involving entities or businesses under common control, regardless of
whether equity instruments or other assets are acquired. The consideration transferred for the
acquisition of a subsidiary comprises the fair values of the assets transferred, the liabilities
incurred and the equity interests issued by the Group. The consideration transferred also
includes the fair value of any contingent consideration arrangement and the fair value of any pre-
existing equity interest in the subsidiary.
Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and
contingent liabilities assumed in a business combination are, with limited exceptions, measured
initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the
group recognises any non-controlling interest in the acquiree either at fair value or at the non-
controlling interest’s proportionate share of the acquiree’s net identifiable assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the
acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over
the fair value of the group’s share of the net identifiable assets acquired is recorded as goodwill.
If those amounts are less than the fair value of the net identifiable assets of the subsidiary
acquired and the measurement of all amounts has been reviewed, the difference is recognised
directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future
are discounted to their present value as at the date of exchange. The discount rate used is the
entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained
from an independent financier under comparable terms and conditions.
Contingent consideration is classified either as equity or a financial liability. Amounts classified as
a financial liability are subsequently remeasured to fair value with changes in fair value
recognised in profit or loss.
(u) Employee benefits
(i) Termination benefits
Termination benefits are recognised as an expense when the Group is committed
demonstrably, without realistic possibility of withdrawal, to a formal detailed plan to either
terminate employment before the normal retirement date, or to provide termination benefits
as a result of an offer made to encourage voluntary redundancy. Termination benefits for
voluntary redundancies are recognised as an expense if the Group has made an offer of
voluntary redundancy, it is probable that the offer will be accepted, and the number of
acceptances can be estimated reliably. If benefits are payable more than 12 months after
the reporting date, then they are discounted to their present value.
(ii) Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are
expensed as the related service is provided. A liability is recognised for the amount expected
to be paid under short-term cash bonus or profit-sharing plans if the Group has a present
legal or constructive obligation to pay this amount as a result of past service provided by the
employee, and the obligation can be estimated reliably.
46
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
2. Summary of Significant Accounting Policies (continued)
(u) Employee benefits (continued)
(iii) Share-based payment transactions
The grant-date fair value of share-based payment awards granted to employees is
recognised as an employee expense, with a corresponding increase in equity, over the
period that the employees unconditionally become entitled to the awards. The amount
recognised as an expense is adjusted to reflect the number of awards for which the related
service and non-market vesting conditions are expected to be met, such that the amount
ultimately recognised as an expense is based on the number of awards that meet the related
service and non-market performance conditions at the vesting date. For share-based
payment awards with non-vesting conditions, the grant date fair value of the share-based
payment is measured to reflect such conditions and there is no true-up for differences
between expected and actual outcomes
(v) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to
the chief operating decision maker. The chief operating decision maker, who is responsible for
allocating resources and assessing performance of the operating segments, has been identified
as the strategic steering committee.
(w) Government Grants
Alexium Inc entered into a capital equipment lease from South Carolina Research Authority
(SCRA) in the form of a grant. The grant is recognised initially as deferred income at fair value
when there is reasonable assurance that they will be received and are then recognised in profit
or loss as other income on a systematic basis over the useful life of the asset.
3. REVENUE
Sales
Other income
Consolidated Group
2014
$
242,465
-
242,465
2013
$
298,812
66,568
365,380
Interest received - other persons
19,042
29,799
47
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
4. OTHER EXPENSES
Minimum lease payments relating to
operating leases
5. AUDITORS’ REMUNERATION
Consolidated Group
2014
$
2013
$
60,743
46,365
During the year the following fees were paid or payable for services provided by the auditor of the
parent entity, its related practices and non-related audit firms:
(a) Stantons International (Australia)
Audit and review of financial reports
(b) Elliott Davis (USA)
Audit of Alexium Inc financial
report
Consolidated Group
2014
$
2013
$
44,191
29,727
19,717
63,908
12,256
41,983
48
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
6. TAXATION
(a) Income tax recognised in profit and loss
Prima facie tax on operating loss before
income tax at 30%
Tax effect of permanent and temporary
differences not booked
Tax losses not brought to account
Income tax benefit attributable to reversal
of deferred tax liability on intangible assets
(b) Deferred tax liabilities
Deferred tax liabilities at 30 June brought to
account:
2014
$
2013
$
(1,264,899)
(868,568)
293,108
768,106
160,251
504,632
(203,685)
(203,685)
Intangible assets
2,580,008
2,783,693
(c) Deferred tax assets
Deferred tax assets at 30 June not brought
to account:
Employee benefits
Other
Income tax losses
5,625
-
3,225,487
3,231,112
9,896
-
2,457,381
2,467,277
Deferred tax assets arising from unconfirmed tax losses and capital losses not brought to
account at balance date as realisation of the benefit is not probable.
No income tax is payable by the Group. The Directors have considered it prudent not to bring to
account the future income tax benefit of income tax losses until there is virtual certainty of
deriving assessable income of a nature and amount to enable such benefit to be realised.
The Group has estimated unrecouped income tax losses of $10,858,290 (2013: $7,666,744)
which may be available to offset against taxable income in future years.
The benefit of these losses and timing differences will only be obtained if there is sufficient
probability that taxable profits will be generated by the company/group in future periods.
49
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
7. EARNINGS PER SHARE
Classification of securities as ordinary shares
The Company has only one category of ordinary shares included in basic earnings per share.
Classification of securities as potential ordinary shares
There are currently no securities to be classified as dilutive potential ordinary shares on issue.
Weighted average number of ordinary shares used
in the calculation of basic earnings per share
Basic loss
Consolidated
Consolidated
2014
Number
2013
Number
177,533,628
142,594,209
$
$
(4,012,644)
(2,599,464)
This calculation does not include instruments that could potentially dilute basic earnings per
share in the future as these instruments were anti-dilutive in the years presented. A summary of
such instruments is as follows:
Equity securities
Options over ordinary
shares
Convertible Notes
Performance Rights
Consolidated
2014
Number of
securities
Consolidated
2013
Number of
securities
19,415,000
16,475,000
8,600,000
26,290,000
17,980,000
-
44,490,000
44,270,000
The group has incurred a loss for the year. The diluted earnings per share is therefore disclosed
as the same as the basic earnings per share.
8. TRADE AND OTHER RECEIVABLES
Consolidated Group
2014
$
64,738
6,237
70,975
2013
$
13,853
8,713
22,566
Current
Trade debtors
Other receivables
None of the trade and other receivables are past due or impaired.
50
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
9. OTHER ASSETS
Current
Prepayments
10. PROPERTY, PLANT & EQUIPMENT
Furniture and Equipment
Cost
Accumulated depreciation
Net book value
Leased assets
Cost
Accumulated depreciation
Net book value
Consolidated Group
2014
$
2013
$
103,661
96,404
Consolidated Group
2014
$
2013
$
519,198
441,868
(216,124)
(148,757)
303,074
293,111
255,591
218,678
(215,523)
(218,678)
40,068
-
Total property, plant and equipment
343,142
293,111
51
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
10. PROPERTY, PLANT & EQUIPMENT (continued)
Movements in carrying amounts
Movement in the carrying amounts for each class of property, plant and equipment between the
beginning and the end of the current financial year.
Furniture & equipment
Balance at the beginning of year
Foreign exchange movements
Additions at cost
Amortisation / Depreciation expense
Leased assets
Balance at the beginning of year
Foreign exchange movements
Additions at cost
Amortisation / Depreciation expense
Consolidated Group
2014
$
2013
$
293,111
275,489
(6,832)
83,079
(66,284)
20,670
60,277
(63,325)
303,074
293,111
Consolidated Group
2014
$
-
(1,305)
45,134
(3,761)
40,068
2013
$
65,609
(244)
-
(65,365)
-
52
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
11. INTANGIBLE ASSETS
Patents and intellectual property
Cost
Accumulated amortisation
Net carrying value
Consolidated Group
2014
$
2013
$
12,138,555
12,045,067
(3,086,431)
(2,365,543)
9,052,124
9,679,524
Movements in carrying amounts
Movement in the carrying amounts of intangible assets between the beginning and the end of the
current financial year.
Consolidated Group
2014
$
2013
$
Balance at the beginning of year
9,679,524
10,332,142
Additions at cost
Foreign exchange movements
Amortisation expense
51,602
38,282
22,525
34,310
(717,284)
(709,453)
9,052,124
9,679,524
Intangible assets have finite useful lives. The current amortisation charges for intangible assets
are included under depreciation and amortisation expense per the consolidated statement of
profit or loss and other comprehensive income.
The ultimate recoupment of costs carried forward for intellectual property is dependent on the
successful development and commercial exploitation of the Group’s technology. In accordance
with Note 1(f) on significant accounting policies, amortisation will be calculated on a straight-line
basis over the average useful life of the patents being 17 years.
12. TRADE AND OTHER PAYABLES
Current
Trade creditors
Other creditors
Consolidated Group
2014
$
2013
$
71,883
117,797
189,680
53,258
74,970
128,228
53
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
12. TRADE AND OTHER PAYABLES (continued)
Trade and other payable amounts represent liabilities for goods and services provided to the
Group prior to the end of the financial year and which are unpaid. The amounts are unsecured
and are usually paid within 30 days or recognition.
13. OTHER LIABILITIES – DEFERRED INCOME
Current - deferred income
Consolidated Group
2014
$
63,564
2013
$
-
The deferred income is in respect of licence fees covering future periods.
14. CONVERTIBLE NOTES
In September 2012, the Company placed a total of 11 million convertible notes with a face value
of 10 cents per note to raise AUD $1.1 million (before costs) to Sophisticated and Professional
Investors. In April 2013 the Company placed a total of 11 million convertible notes with a face
value of 10 cents per note to raise AUD $1.1 million (before costs) to Sophisticated and
Professional Investors. During the year 550,000 shares (2013: 7,737,983) were issued at a price
of $0.10 each on conversion of 550,000 (2013: 4,020,000)A series convertible notes and 955,000
shares (2013: Nil) were issued at a price of $0.10 each on conversion of 955,000 (2013: Nil) B
series convertible notes.
The movement in number of convertible notes is given hereunder:
A Series Convertible Notes
B Series Convertible Notes
Balance at
beginning of the
year
6,980,000
11,000,000
Issued during the
Year
Converted to
Equity during the
Year
Balance at the
end of the year
-
-
(550,000)
(955,000)
6,430,000
10,045,000
A Series
$
30 June 2014
B Series
$
Total
$
A Series
$
30 June 2013
B Series
$
Total
$
654,078
982,960 1,637,038
-
-
-
-
-
-
-
-
-
1,100,000
(30,264)
1,100,000
(43,932)
2,200,000
(74,196)
123,212
164,703
287,915
166,077
28,466
194,543
(86,109)
(122,124)
(208,233)
(101,200)
(22,783)
(123,983)
(55,000)
(95,500)
(150,500)
(402,000)
-
(402,000)
-
-
-
(78,535)
(78,791)
(157,326)
636,181
930,039 1,566,220
654,078
982,960
1,637,038
Balance at the beginning
of the period
Placement of notes
Adjustment to equity
Unwinding of finance
costs
Interest paid at coupon
rate
Conversion during the
year
Issue costs
Balance at the end of the
year
54
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
14. CONVERTIBLE NOTES (continued)
The Terms and conditions of A Series and B Series Convertible Note are as under:
Convertible Notes – A Series
A maturity date of 30 August 2014.
Coupon rate of 13% per annum with interest paid quarterly in arrears.
Convertible notes are unlisted and unsecured and are convertible to fully paid ordinary shares.
Conversion price is lesser of:
$0.10 per share
OR;
87.5% of the previous 30 day volume weighted average price for the Company’s ordinary
shares
OR;
In the event of a future issue of ordinary shares during the term, the price of issue of such
fully paid ordinary shares.
The note holder may elect to convert the convertible notes at any time after 90 days from the
Allotment Date until the Maturity Date.
Convertible Notes – B Series
A maturity date of 30 March 2016.
Coupon rate of 12% per annum with interest paid quarterly in arrears.
Convertible notes are unlisted and unsecured and are convertible to fully paid ordinary shares.
Conversion price is lesser of:
$0.10 per share
OR;
87.5% of the previous 30 day volume weighted average price for the Company’s ordinary
shares
OR;
In the event of a future issue of ordinary shares during the term, the price of issue of such
fully paid ordinary shares.
The note holder may elect to convert the convertible notes at any time after 90 days from the
Allotment Date until the Maturity Date.
15. CONTRIBUTED EQUITY
(a) Issued Capital
Consolidated Group
2014
$
2013
$
202,025,435 (2013: 149,197,632) Ordinary shares
fully paid
24,773,640
18,092,756
Total issued capital
24,773,640
18,092,756
55
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
15. CONTRIBUTED EQUITY (continued)
(b) Movements in share capital
2014
Number
2014
$
2013
Number
2013
$
Balance of ordinary shares at beginning of
year
Shares issued, net of costs*
Balance of ordinary shares at end of year
149,197,632
52,827,803
202,025,435
18,092,756
6,680,884
24,773,640
139,888,221
9,309,411
149,197,632
17,601,756
491,000
18,092,756
* $150,500 of convertible notes were converted to shares ($55,000 Series A and $95,500 Series B),
$126,667 of options were converted to shares and there was capital raising of $5,220,000 less capital
raising costs of $403,812. There was also $100,000 of shares issued in lieu of salary to Gavin Rezos and a
share purchase plan of $1,499,975. There was a share buy back of unmarketable parcels of shares for
$12,446.
(c) Movements in Performance Rights
Balance of performance rights at
beginning of year
Rights issued, net of costs**
Balance of performance rights at
end of year
2014
Number
2014
$
2013
Number
2013
$
-
8,600,000
-
198,660
8,600,000
198,660
-
-
-
-
-
-
** The underlying value of an Alexium share trading on ASX on 25 November 2013 was $0.165, this has
been used as an underlying value of a performance right in Alexium. The 8,600,000 discounted
performance rights in Alexium issued to Directors and employees has an underlying value of $198,660
based on the closing share price on 25 November 2013 of $0.165.
As announced on the 25th November 2013, Alexium issued 8,600,000 performance rights; 5,500,000
issued to Directors and 3,100,000 issued to employees. The performance rights were issued for nil
consideration.
In order to vest, milestone 1 and any of the other milestones will need to be achieved by 31 December
2014.
Share Price Appreciation
The price of Shares as traded on ASX must exceed $0.186325 over a 10 day volume weighted average
price during the Period, being a 45% premium to the average closing price of Shares on ASX in the 10
trading days immediately prior to the date of the 2013 AGM of $0.1285.
Revenue of not less than $3.0m for the Period
The Company must achieve at least $3.0m in revenues during the Period.
Achieving Product Sales on 3 Products
The Company must achieve either direct product sales revenues or licencing revenues on at least 3
products during the Period.
Entering into an Additional Licences
The Company must enter into one or more additional licences on its FR products in addition to its current
licence to Duro LLC with large national companies for licenses geographically restricted to national or
regional areas or multinational companies for multi-jurisdictional licences during the Period.
Entering into Joint Ventures
The Company must enter into a new joint venture for the development of its products outside textile
finishing, with a recognised leader in the field, the subject of the joint venture, during the Period.
(i)
(ii)
(iii)
(iv)
(v)
56
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
15. CONTRIBUTED EQUITY (continued)
(c) Movements in performance rights (continued)
(vi)
(vii)
(viii)
Product Sales for Chem/Bio Protection
The Company must achieve either direct product sales revenues or licencing revenues from its RST
applications on Chemical and Biological Protection ensembles during the Period.
NASDAQ Quotation
The Company’s shares, American depositary receipts or the shares of the entity resulting from a merger of
the Company and its US subsidiary being quoted on the NASDAQ Securities Exchange or equivalent US
Securities Exchange for technology companies of similar standing, during the Period.
US Department of Defense Contracts
The Company must enter into, directly or through a supplier, at least one significant contract with an arm or
agency of the US Department of Defense during the Period in relation to products utilising either the RST
technology or FR technology.
(d) Share options issued
At the year end there were Nil free attaching options outstanding (2013: 5,000,000) and
19,415,000 share based payment options outstanding (2013: 21,290,000). Refer to Note 16 for
details of the share based payment options outstanding.
(e) Movements in share options
Grant
date
Exercise
Price
Expiry
date
Balance at
beginning of
year
Granted
during the
year
Exercised
during the
year
Number
Number
Number
Forfeited/
Expired
during the
year
Number
Balance at end of
year
Number
2014
year
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
30/07/10
$0.30
31/12/14
2,500,000
21/03/11
$0.15
31/12/15
750,000
21/03/11
$0.15
31/12/15
6,750,000
21/03/11
$0.20
21/03/11
$0.25
22/06/11
$0.10
31/12/15
31/12/15
21/06/16
750,000
1,000,000
540,000
21/09/11
$0.15
31/12/15
5,000,000
22/02/12
$0.125
22/08/13
5,000,000
30/11/12
$0.074
31/12/16
4,000,000
26,290,000
-
-
-
-
-
-
-
-
-
-
-
-
-
2,500,000
(750,000)
-
(375,000)
-
6,375,000
-
-
-
-
(750,000)
-
-
-
-
1,000,000
540,000
5,000,000
(563,337)
(4,436,663)
-
-
(938,337)
-
(5,936,663)
4,000,000
19,415,000
57
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
15. CONTRIBUTED EQUITY (continued)
(e) Movements in share options (continued)
Grant
date
Exercise
Price
Expiry
date
Balance at
beginning of
year
Granted
during the
year
Exercised
during the
year
Number
Number
Number
Lapsed/
Expired
during the
year
Number
Balance at end of
year
Number
2013
year
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
19/06/08
$0.10
31/12/12
7,000,000
26/02/10
$0.50
26/02/14
1,250,000
30/07/10
$0.30
31/12/14
2,500,000
21/03/11
$0.15
31/12/15
750,000
21/03/11
$0.15
31/12/15
6,750,000
21/03/11
$0.20
21/03/11
$0.25
22/06/11
$0.10
31/12/15
31/12/15
21/06/16
750,000
1,000,000
540,000
21/09/11
$0.15
31/12/15
5,000,000
22/02/12
$0.125
22/08/13
5,000,000
-
-
-
-
-
-
-
-
-
-
30/11/12
$0.074
31/12/16
-
30,540,000
4,000,000
4,000,000
-
-
-
-
-
-
-
-
-
-
-
-
(7,000,000)
(1,250,000)
-
-
-
-
-
-
-
-
-
-
2,500,000
750,000
6,750,000
750,000
1,000,000
540,000
5,000,000
5,000,000
-
(8,250,000)
4,000,000
26,290,000
4,436,663 options expired during the current year (2013: 7,000,000).
1,500,000 options were forfeited during the current year due to resignation of a staff member
(2013: 1,250,000).
375,000 share based payment options were exercised during the current year (2013: Nil).
563,337 options were exercised during the current year (2013: Nil).
In the event of winding up of the Company, ordinary shareholders rank after all other
shareholders and creditors and are fully entitled to any proceeds of liquidation.
(f) Terms and conditions of contributed equity
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are
entitled to one vote per share at shareholders’ meetings.
In the event of winding up of the Company, ordinary shareholders rank after all other
shareholders and creditors and are fully entitled to any proceeds of liquidation.
(g) Capital management
The Company’s objectives in managing capital are to safeguard the Group’s ability to continue as
a going concern, so that it can continue to provide returns to shareholders and benefits for the
stakeholders and to maintain an optimal capital structure to reduce the cost of capital.
58
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
16. SHARE-BASED PAYMENTS
(a) Shares
2014
Number
2014
Value per
Share
$
2014
$
Share-based payments issued during the year for
services received
Share-based payments issued during the year for
payment in lieu of salary
Total
-
-
-
778,210
0.1285
778,210
100,000
100,000
Share-based payments issued during the year for
services received
Share-based payments issued during the year for
payment in lieu of salary
Total
(b) Performance rights
2013
Number
2013
Value per
Share
$
2013
$
71,428
0.07
5,000
1,500,000
0.06
1,571,428
90,000
95,000
2014
Number
2014
Value per
Share
$
2014
$
Share-based payments issued during the year
8,600,000
0.0231
Total
8,600,000
198,660
198,660
The Company agreed and approved at the 25 November 2013 AGM to issue a total of 8,600,000
performance rights to Directors and employees. The terms and conditions of the performance
rights are detailed in the Notice of General Meeting dated 25 November 2013. The performance
rights were issued for nil consideration.
The underlying value of an Alexium share trading on ASX on 25 November 2013 was $0.165,
this has been used as an underlying value of a performance right in Alexium. The 8,600,000
discounted performance rights in Alexium issued to Directors and employees has an underlying
value of $198,660 based on the closing share price on 25 November 2013 of $0.165 and with a
probability discount of 80% and an unlisted status discount of 30% has been applied. Only
59
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
16. SHARE-BASED PAYMENTS (continued)
(b) Performance rights (continued)
$106,971 was expensed during the year as the vesting period ends 31 December 2014. There
were no share based payment performance rights issued in 2013.
(c) Options
Share-based payments (reversed)/expensed during
the year for:
- options vested, forfeited
Share-based payments expensed during the year
for:
- ESOP 2011
-ESOP 2012
- ESOP 2013
Total
Pro-rata over vesting period.
Share-based payments (reversed)/expensed during
the year for:
- services rendered
- options not yet vested, forfeited
2014
Number
2014
$
1,500,000
1,500,000
-
-
-
-
-
-
1,500,000
3,515
1,987
21,008
26,510
26,510
2013
Number
2013
$
-
1,250,000
1,487
(8,428)
1,250,000
(6,941)
* Issue 26 February 2010 in respect of the acquisition of Alexium Limited however pro-rata over period of
performance period.
Share-based payments expensed during the year
for:
- ESOP 2011
- ESOP 2012
- ESOP 2013
Total
Pro-rata over vesting period
-
-
-
-
1,250,000
36,433
11,679
19,913
68,025
61,084
60
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
16. SHARE-BASED PAYMENTS (continued)
(d) Shares, options and performance rights
Share based payments in shares 16 (a)
Share based payments in performance
rights 16 (b)
Share based payments in options 16 (c)
Totals
2014
$
2013
$
100,000
95,000
106,971
26,510
233,481
-
61,084
156,084
61
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
16. SHARE-BASED PAYMENTS (continued)
Share Based Payment Options Issued
Grant
date
Exercise
Price
Expiry
date
Balance at
beginning of
year
Granted
during the
year
Exercised
during the
year
Number
Number
Number
Other
changes
during the
year
(Forfeited)
Number
Balance at end of
year
Vested and
exercisable
at the end of
period
Number
Number
2014
year
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
2013
year
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
Unlisted
options
30/07/10
$0.30
31/12/14
2,500,000
21/03/11
$0.15
31/12/15
7,500,000
21/03/11
$0.20
31/12/15
750,000
21/03/11
$0.25
31/12/15
1,000,000
22/06/11
$0.10
21/06/16
540,000
21/09/11
$0.15
31/12/15
5,000,000
30/11/12
$0.074
31/12/16
4,000,000
21,290,000
0.16
Weighted average exercise price ($)
-
-
2,500,000
2,500,000
(375,000)
(750,000)
6,375,000
6,375,000
(750,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(375,000)
-
(1,500,000)
1,000,000
1,000,000
540,000
540,000
5,000,000
5,000,000
4,000,000
19,415,000
2,000,000
17,415,000
0.16
0.17
Grant
date
Exercise
Price
Expiry
date
Balance at
beginning of
year
Granted
during the
year
Exercised
during the
year
Number
Number
Number
Other
changes
during the
year
Number
Balance at end of
year
Number
Vested and
exercisable
at the end of
period
Number
26/02/10
$0.50
26/02/14
1,250,000
30/07/10
$0.30
31/12/14
2,500,000
21/03/11
$0.15
31/12/15
7,500,000
21/03/11
$0.20
31/12/15
750,000
21/03/11
$0.25
31/12/15
1,000,000
22/06/11
$0.10
21/06/16
540,000
21/09/11
$0.15
31/12/15
5,000,000
-
-
-
-
-
-
-
30/11/12
$0.074
31/12/16
Weighted average exercise price ($)
-
18,540,000
0.20
4,000,000
4,000,000
0.074
-
-
-
-
-
-
-
-
-
(1,250,000)
-
-
-
-
-
-
-
-
-
(1,250,000)
2,500,000
2,500,000
7,500,000
7,375,000
750,000
750,000
1,000,000
-
540,000
540,000
5,000,000
2,500,000
4,000,000
21,290,000
-
13,665,000
0.16
0.18
The above tables are for share based payment options issued for services rendered or under
ESOP.
375,000 share based payment options were exercised during the current year (2013: Nil).
1,500,000 options were forfeited during the current year due to resignation of a staff member
(2013: 1,250,000).
62
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
16. SHARE-BASED PAYMENTS (continued)
The weighted average remaining contractual life of share options outstanding at the end of the
financial year was 1.60 years (2013: 2.59 years), and the exercise prices range from 7.4 cents to
30 cents. (2013: 7.4 cents to 30 cents).
The assessed fair values of the options were determined using a Black-Scholes option pricing
model, taking into account the exercise price, term of option, the share price at grant date and
expected price volatility of the underlying share, expected dividend yield and the risk-free interest
rate for the term of the option. No options were issued in 2014.
Issued 2013
Expiry date
Dividend yield (%)
Expected volatility (%)
Risk-free interest rate (%)
Expected life of options
(years)
Underlying share price ($)
Option exercise price ($)
Value of Option ($)
OPTION SERIES
31/12/16
-
40
2.79
4.09
0.059
0.0738
0.011428
17. RESERVES
Convertible Note-Equity Component
Option premium reserve
Performance Rights reserve
Foreign currency translation reserve
Balance at end of year
Consolidated Group
2014
$
74,196
603,038
106,971
2013
$
74,196
576,528
-
(260,527)
(135,975)
523,678
514,749
Convertible Note – Equity Component
The fair value of the Convertible Notes is determined by estimating the effective interest rate to
determine the equity proportion of the note as detailed in Note 14.
Balance at beginning of year
Equity Component – Convertible Note A Series
Equity Component – Convertible Note B Series
Balance at end of year
63
Consolidated Group
2014
$
74,196
-
-
74,196
2013
$
-
30,264
43,932
74,196
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
17. RESERVES (continued)
Option premium reserve
The option premium reserve is used to recognise the fair value of options issued.
Balance at beginning of year
Share-based payment expense (Note 16(c))
Balance at end of year
Performance rights reserve
Balance at beginning of year
Performance rights expense
Balance at end of year
Consolidated Group
2014
$
2013
$
576,528
515,444
26,510
61,084
603,038
576,528
Consolidated Group
2014
2013
$
-
106,971
106,971
$
-
-
-
Foreign currency translation reserve
Exchange differences arising on translation of foreign controlled entities are taken to the foreign
currency translation reserve, as described in Note 2 (d). The reserve is recognised in profit and
loss when the net investment is disposed of.
Consolidated Group
2014
$
2013
$
(135,975)
(212,934)
(124,552)
76,959
(260,527)
(135,975)
Consolidated Group
2014
$
2013
$
(11,930,131)
(11,430,615)
-
2,099,948
(4,012,644)
(2,599,464)
(15,942,775)
(11,930,131)
Balance at beginning of year
Foreign currency translation differences
arising during the year
Balance at end of year
18. ACCUMULATED LOSSES
Balance at beginning of year
Transfer from share capital to
accumulated losses
Net loss attributable for the year
Balance at end of year
64
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
19. NOTES TO THE STATEMENT OF CASH FLOWS
(a) Cash and cash equivalents
For the purposes of the statement of cash flows, cash and cash equivalents include cash on
hand and in banks and deposits at call, net of outstanding bank overdrafts.
Cash and cash equivalents at the end of the year as shown in the statement of cash flows are
reconciled to the related item in the statement of financial position as follows:
Cash on hand
Cash at bank attracts floating interest at current market rates
Consolidated Group
2014
$
2013
$
4,197,460
1,163,231
(b) Reconciliation of operating loss after income tax to net cash used in operating activities
Consolidated Group
2014
$
2013
$
Operating profit/(loss) after income tax
(4,012,644)
(2,599,464)
Non-cash items
Depreciation and amortisation of non-current assets
Provision for Doubtful Debt
Share-based payment
Unrealised foreign exchange (gains) / losses
Grant Income
Interest and Amortisation of convertible notes costs
787,329
-
233,481
31,840
-
287,915
838,143
65,234
156,084
3,940
(65,318)
194,543
Income Tax Benefit
(203,685)
(203,685)
Changes in assets and liabilities net of effect of
purchase of subsidiaries
(Increase)/Decrease in trade and other receivables
(Increase)/Decrease in other current assets
Increase / (Decrease) in payables
(48,409)
(7,257)
61,452
84,083
(41,599)
(23,590)
Net cash (used in) operating activities
(2,869,978)
(1,591,629)
(c) Non-cash Financing and Investing Activities
During the 2010 financial year Alexium Inc entered into a capital equipment lease from South
Carolina Research Authority (SCRA) in the form of a grant. The value of the lease is
US$200,000 to lease equipment including forklift, lab equipment and computers of which assets
to the full value was received by Alexium Inc during the year ended 30 June 2011.
65
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
19. NOTES TO THE STATEMENT OF CASH FLOWS (continued)
(c) Non-cash Financing and Investing Activities (continued)
This amount is being recognised as income over three years. The repayments are nil per month
for 3 years with a buyout option at the end of the period or return the equipment. This agreement
has been extended for 12 months to June 1 2015. Alexium are currently reviewing the buyout
option.
20. SEGMENT REPORTING
For management purposes, the Group is organised into one main operating segment which
involves the development of a patented technology known as “Reactive Surface Technology”
(RST). Alexium is the exclusive licensee of this particular patent and has applied for additional
patents in its own capacity around the world. All of the Group’s activities are interrelated and
discrete financial information is reported to the Board (Chief Operating Decision Maker) as a
single segment. Accordingly, all significant operating decisions are based upon analysis of the
Group as one segment. The financial results from this segment are equivalent to the financial
statements of the Group as a whole.
21. INVESTMENTS IN CONTROLLED ENTITIES
Name of Entity
Parent Entity
Country of
Incorporation
Percentage Owned
(ordinary shares)
2013
2014
%
%
Alexium International Group Limited
Australia
Subsidiaries of Alexium International Group Limited
Alexium Limited
Alexium Inc
Cyprus
United States of America
100
100
100
100
The parent entity has an interest free unsecured loan with Alexium Inc amounting to $9,081,153
(2013: $4,813,413).
The parent entity has an interest free unsecured loan with Alexium Ltd amounting to $413,831
(2013: $381,477).
22. KEY MANAGEMENT PERSONNEL DISCLOSURES
(a)
Directors and other key management personnel
The Directors of Alexium International Group Limited during the financial year were:
Mr Gavin Rezos
Mr Craig Smith-Gander
Mr Nicholas Clark
The Company Secretary is Mr Cameron Maitland.
66
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
22. KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
(a) Directors and other key management personnel (continued)
Other key management personnel during the financial year were:
Mr Stefan Susta – VP Sales and Marketing
Dr Bob Brookins – Head of Research and Development
Dr Dirk Van Hyning - Head of Product Development and Commercial Transition
(b) Compensation of key management personnel
Detailed remuneration disclosures are provided in the Remuneration report on pages 10 to 21.
Short-term benefits
Post employment benefits
Termination benefits
Share-based payments
Consolidated Group
2014
$
2013
$
904,081
596,177
3,527
-
217,300
1,124,908
7,706
-
140,258
744,141
Value of shares and options issued to directors and executives
The Directors and Executives of the Company were issued with the following share-based
remuneration during the year:
Nil ESOP Options (2013: 4 million ESOP Options) with a value of Nil (2013: $45,710); out of
which nil vested in 2014 (2013: Nil). 2,000,000 of the ESOP options issued in 2013 vested in
2014.
778,210 fully paid shares issued for $100,000 (2013: 1,500,000 shares issued for $90,000) in lieu
of salary.
67
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
22. KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
(c) Equity instrument disclosures relating to key management personnel
(i)
Option holdings
The number of options over ordinary shares in the Company held during the financial year by
each Director and Executive of Alexium International Group Limited, including their personally
related parties, are set out below.
Balance at
start of
year
Granted during
year as
remuneration
Exercised
during
year
Number
Number
Number
Other
changes
during
year
(expired)
Number
Balance at
end of year
Options Vested
and exercisable at
end of year
Number
Number
2014
Name
Directors
Mr G Rezos
Mr C Smith-Gander
Mr Nicholas Clark
Total Directors
Executives
Mr S Susta
Dr D Van Hyning
Dr B Brookins
Total Executives
Total Directors and
Executives
2013
Name
6,500,000
1,500,000
2,000,000
10,000,000
3,500,000
-
3,000,000
6,500,000
16,500,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Balance at
start of year
Granted
during year
as
remuneration
Exercised
during
year
Number
Number
Number
Directors
Mr G Rezos
Mr C Smith-Gander
Mr Nicholas Clark
Mr S Susta
Total Directors
Executives
Mr J Almond
Dr B Brookins
Total Executives
Total Directors and
Executives
7,150,000
1,000,000
2,000,000
2,000,000
12,150,000
1,250,000
3,000,000
4,250,000
2,000,000
500,000
-
1,500,000
4,000,000
-
-
-
16,400,000
4,000,000
-
-
-
-
-
-
-
-
-
68
-
-
-
-
-
-
-
-
-
Other
changes
during
year
(expired)
Number
(2,650,000)
-
-
-
(2,650,000)
(1,250,000)
-
(1,250,000)
6,500,000
1,500,000
2,000,000
10,000,000
3,500,000
-
3,000,000
6,500,000
5,500,000
1,250,000
2,000,000
8,750,000
2,750,000
-
3,000,000
5,750,000
16,500,000
14,500,000
Balance at
end of year
Options Vested
and exercisable at
end of year
Number
Number
6,500,000
1,500,000
2,000,000
3,500,000
13,500,000
-
3,000,000
3,000,000
3,500,000
500,000
2,000,000
1,000,000
7,000,000
-
2,000,000
2,000,000
(3,900,000)
16,500,000
9,000,000
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
22. KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
(ii)
Share holdings
The number of shares in the Company held during the financial year by each Director and
Executive of Alexium International Group Limited, including their personally related parties, is set
out below. 778,210 shares were granted during the reporting year as compensation (2013:
1,500,000 shares).
2014
Name
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark
Total Directors
Executives
Mr S Susta
Dr B Brookins
Dr D Van Hyning
Total Executives
Total Directors and
Executives
Balance at
start of year
ORDINARY
SHARES
Granted
During the
Year as
Remuneration
Received
during year
on exercise of
options
Number
Number
Number
17,305,776
314,286
1,950,000
778,210
-
-
19,570,062
778,210
-
-
-
-
-
-
-
-
19,570,062
778,210
-
-
-
-
-
-
-
-
-
Other
changes
during year
ORDINARY
SHARES
Number
570,880
270,880
149,900
Balance at end
of year
ORDINARY
SHARES
Number
18,654,866
585,166
2,099,900
991,660
21,339,932
-
-
-
-
-
-
-
-
991,660
21,339,932
69
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
22. KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
2013
Name
Balance at
start of year
ORDINARY
SHARES
Granted
During the
Year as
Remuneration
Received
during year
on exercise of
options
Number
Number
Number
Other
changes
during year
ORDINARY
SHARES
Number
Balance at end
of year
ORDINARY
SHARES
Number
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark(1)
Mr S Susta
14,090,776
114,286
-
-
-
-
1500,000
-
Total Directors
14,205,062
1,500,000
Executives
Mr J Almond(2)
Dr B Brookins
Mr H Alkis
Total Executives
Total Directors and
Executives
14,513,000
-
-
14,513,000
-
-
-
-
-
-
-
-
-
-
-
-
-
3,215,000
200,000
450,000
-
17,305,776
314,286
1,950,000
-
3,865,000
19,570,062
-
-
-
-
14,513,000
-
-
14,513,000
1,500,000
(1) Balance at date of appointment. Mr Clark was Company Secretary at the beginning of the year. He was
28,718,062
3,865,000
-
34,083,062
appointed as Chief Executive Officer on 22 January 2013 and Executive Director on 18 March 2013.
(2) Balance at date of resignation
(iii)
Performance rights holdings
The number of performance rights in the Company held during the financial year by each Director
and Executive of Alexium International Group Limited, including their personally related parties, is
set out below. 7,300,000 performance rights were granted during the reporting year as
compensation (2013: Nil).
2014 Performance rights
Name
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark
Total Directors
Executives
Mr S Susta
Dr B Brookins
Dr D Van Hyning
Total Executives
Total Directors and Executives
Balance at start
of year
PERFORMANCE
RIGHTS
Number
Granted
During the
Year as
Remuneration
Number
Other changes
during year
PERFORMANCE
RIGHTS
Balance at end
of year
PERFORMANCE
RIGHTS
Number
Number
-
-
-
-
-
-
-
-
-
2,500,000
-
3,000,000
5,500,000
800,000
600,000
400,000
1,800,000
7,300,000
2,500,000
-
3,000,000
5,500,000
800,000
600,000
400,000
1,800,000
7,300,000
-
-
-
-
-
-
-
-
-
70
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
22. KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
2013 Performance shares
Name
Directors
Mr G Rezos
Mr C Smith-Gander
Mr N Clark(1)
Mr S Susta
Total Directors
Executives
Mr J Almond(2)
Dr B Brookins
Mr H Alkis
Total Executives
Total Directors and Executives
Balance at start
of year
PERFORMANCE
SHARES
Number
Granted
During the
Year as
Remuneration
Number
Other changes
during year
PERFORMANCE
SHARES
Balance at end
of year
PERFORMANCE
SHARES
Number
Number
2,500,000
-
-
-
2,500,000
22,085,000
-
-
22,085,000
24,585,000
-
-
-
-
-
-
-
-
-
-
(2,500,000)
-
-
-
(2,500,000)
(22,085,000)
-
-
(22,085,000)
(24,585,000)
-
-
-
-
-
-
-
-
-
-
(1) Balance at date of appointment. Mr Clark was Company Secretary at the beginning of the year. He was
appointed as Chief Executive Officer on 22 January 2013 and Executive Director on 18 March 2013.
(2) Balance at date of resignation
No performance shares were issued in 2014. 5,500,000 performance rights were issued to
Directors in 2014 as noted above. 1,800,000 performance rights were issued to Executives in
2014 as noted above.
(d) Other transactions with key management personnel
During the period the following was paid or payable to Viaticus Capital Pty Ltd, a related
party of G Rezos:
(a) $11,153 (2013:$129,669) for reimbursement of salary and wages in relation to
administration and bookkeeping personnel provided by Viaticus Capital of which G
Rezos is a director.
(b) $116,512 (2013: $223,319) to reimburse sums paid by Viaticus on behalf of Alexium
for travel and relocation expenses, administration services and equipment purchase.
Of this, $3,026 in expense reimbursements remained unpaid to Viaticus as at 30 June
2014.
(c) $35,590 (2013: $33,825) for office rent.
(d) Nil (2013: $6,600) for investor relations services.
23. FINANCIAL INSTRUMENTS
(a) Interest rate risk exposures
The Group is exposed to interest rate risk through primary financial assets and liabilities. The
carrying amounts of financial assets and financial liabilities held at balance date approximate
their estimated net fair values and are given below. The net fair value of a financial asset or a
financial liability is the amount at which the asset could be exchanged, or liability settled in a
current transaction between willing parties after allowing for transaction costs.
71
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
23. FINANCIAL INSTRUMENTS (continued)
The Group’s exposure to interest rate risk and the effective weighted average interest rate for
classes of financial assets and financial liabilities is set out below:
2014
Financial
Assets
Cash and cash
equivalents
Trade and other
receivables/other
financial assets
Financial
Liabilities
Trade and other
payables
Convertible
Notes
2013
Financial
Assets
Cash and cash
equivalents
Trade and other
receivables/other
financial assets
Financial
Libilities
Trade and other
payables
Convertible
Notes
Variable
Interest
Rate
Weighted
Average
Effective
Interest
Rate
%
$
Fixed
Maturity
Dates
Less
than 1
Year
$
Fixed
Maturity
Dates 1-
5 Years
Fixed
Maturity
Dates
5+
years
Total
Non
Interest
Bearing
$
$
$
$
.71
1,191,910
-
-
1,191,910
-
12.4
-
-
-
-
-
-
-
-
-
-
-
636,181
636,181
930,039
930,039
-
3,005,550
4,197,460
70,975
-
70,975
- 3,076,525 4,268,435
-
-
-
189,680
189,680
-
1,566,220
189,680 1,755,900
Variable
Interest
Rate
Weighted
Average
Effective
Interest
Rate
%
$
Fixed
Maturity
Dates
Less
than 1
Year
$
Fixed
Maturity
Dates 1-5
Years
Fixed
Maturity
Dates
5+
years
Total
Non
Interest
Bearing
$
$
$
$
1.09
459,702
-
-
459,702
-
12.4
-
-
-
72
-
-
-
-
-
-
-
-
-
703,529
1,163,231
22,566
-
22,566
- 726,095 1,185,797
-
128,228
128,228
-
1,637,038
- 1,637,038
-
1,637,038
-
- 128,228 1,765,266
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
23. FINANCIAL INSTRUMENTS (continued)
Sensitivity risk
At 30 June 2014, if interest rates had increased by 1% from the year end variable rates with all
other variables held constant, post tax profit and equity for the Group would have been $11,919
higher (2013: changes of 1% $11,632 higher/$11,632 lower) based on cash and cash equivalent
held at variable rates.
The 1% (2013: 1%) sensitivity is based on reasonably possible changes, over a financial year,
using an observed range of historical RBA movements over the last year.
Foreign currency risk
The Group currently conducts its operations across international borders.
A proportion of the Group’s revenues, cash inflows, other expenses, capital expenditure and
commitments are denominated in foreign currencies, namely with costs and income in US
dollars, GBP and Euro initially.
To comply with Australian reporting requirements the income, expenditure and cash flows of the
Group will need to be accounted for in Australian dollars. This will result in the income,
expenditure and cash flows of the Company being exposed to the fluctuations and volatility of the
rate of exchange between other currencies and the Australian dollar, as determined in
international markets.
Exposure to foreign exchange risk may result in the fair value or future cash flows of a financial
instrument fluctuating due to movement in foreign exchange rates of currencies in which the
Group holds financial instruments which are other than the AUD functional currency of the parent
or USD functional currency of US Alexium Inc. or the UK pound sterling functional currency of
Alexium Ltd.
With instruments being held by overseas operations, fluctuations in the US dollar and UK pound
sterling may impact on the Group’s financial results.
The following table shows the foreign currency risk on the financial assets and liabilities of the
Group’s operations denominated in currencies other than the functional currency of the
operations.
2014
Consolidated Group
Functional currency of entity:
Australian dollar
US dollar
UK pound sterling
9,081,153
-
Statement of financial position
exposure
9,081,153
Net Financial Assets/(Liabilities) in AUD
USD
AUD
GBP
Other
Total AUD
-
-
-
-
413,831
(944,223)
-
(530,392)
-
-
-
-
9,494,984
(944,223)
8,550,761
The above balances relate to intercompany loans between member companies of the group.
73
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
23. FINANCIAL INSTRUMENTS (continued)
2013
Consolidated Group
Functional currency of entity:
Australian dollar
US dollar
UK pound sterling
Statement of financial
position exposure
Net Financial Assets/(Liabilities) in AUD
USD
AUD
GBP
Other
Total AUD
4,813,413
-
4,813,413
-
-
-
-
381,477
(1,028,209)
-
(646,732)
-
-
-
-
5,194,890
(1,028,209)
4,166,681
The above balances relate to intercompany loans between member companies of the group.
Credit risk
Credit risk arises from the financial assets of the Group, which comprise cash and cash
equivalents. The Group's exposure to credit risk arises from potential default of the counter
party, with a maximum exposure equal to the carrying amount of these instruments.
The Group does not hold any credit derivatives to offset its credit exposure. The Group’s
exposure to credit risk is minimal.
As the Group does not currently have any significant debtors, lending, stock levels or any other
credit risk, a formal credit risk management policy is not maintained.
Liquidity risk
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and
ensuring sufficient cash and marketable securities are available to meet the current and future
commitments of the Group. Due to the nature of the Group’s activities, being development of a
patented technology known as “Reactive Surface Technology”, the Group does not have ready
access to credit facilities, with the primary source of funding being equity raisings. The Board of
Directors constantly monitor the state of equity markets in conjunction with the Group’s current
and future funding requirements, with a view to initiating appropriate capital raisings as required.
All financial assets and financial liabilities have a maturity date of less than one year.
(b) Net fair values of financial assets and liabilities
The net fair values of the financial assets and liabilities at balance date of Alexium International
Group Limited approximate the carrying amounts in the financial statements, except where
specifically stated.
74
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
24. PARENT ENTITY INFORMATION
The following details information related to the parent Entity, Alexium International Group Limited, at 30
June 2014. The information presented here has been prepared using consistent accounting policies as
presented in Note 2.
Current Assets
Non-current assets
Total Assets
Current liabilities
Non-current liabilities
Total Liabilities
Contributed equity
Accumulated losses
Reserves
Total equity
Loss for the year
Other comprehensive income net of tax for the
year
Total comprehensive income net of tax for the
year
Parent Entity
2014
$
2013
$
1,200,242
471,352
21,567,511
17,268,917
22,767,753
17,740,269
683,905
63,098
930,039
1,637,038
1,613,944
1,700,136
24,773,640
18,092,756
(4,404,036)
(2,703,347)
784,205
650,724
21,153,809
16,040,133
(1,700,689)
(823,645)
-
-
(1,700,689)
(823,645)
The Company’s commitments and contingencies are detailed in Note 25.
25. COMMITMENTS AND CONTINGENCIES
The Group has the following contingent liabilities and commitments.
1) Alexium has entered into an agreement with the United States Department of Defence
whereby Alexium owns exclusive rights for the RST Technology under patent application in
the United States in exchange for a 2.5% gross sales royalty to be paid to the US
Government. Alexium has also entered into an agreement with Dr Owens for exclusive rights
to the rest of the world, for the same patent application excluding the United States, in
exchange for a 5% gross sales royalty to be paid to Dr Owens. These royalties only apply
where the RST technology is used in the product production process, which does not include
all fire retardant products.
75
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
25. COMMITMENTS AND CONTINGENCIES (continued)
2) On February 9 2012 the Group entered into an agreement with Baker Young Stockbrokers
Limited to provide corporate advisory services for $5,000 per month for a period of 12
months. This agreement continues on a month to month basis. This agreement was
renewed in March 2014 for a further 12 months.
3) 23 April 2013 the Group entered into an agreement with The Lebrecht Group APLC as its
Principal American Liaison (PAL) for the company’s securities to trade on the OTCQX
marketplace in the United States. This agreement may be terminated by any of the parties
at any time, for any reason, by providing written notice to each of the other parties.
Based on discussions with the Directors and legal advisors, to our knowledge, the Group has no
other material commitments or contingent liabilities.
(a) Commitments
Lease commitments
(i)
Operating leases
Alexium Inc leases two premises in South Carolina under operating leases which expire on 30
April 2015 and 31 March 2016. The leases have various terms, escalation clauses and renewal
rights.
Commitments for minimum lease payments in
relation to operating leases are payable as
follows:
Within one year
Later than one year but not later than 5 years
Later than 5 years
(ii)
Capital equipment lease
Consolidated Group
2014
$
77,834
71,045
-
2013
$
48,751
88,672
-
During the 2010 financial year Alexium Inc entered into a capital equipment lease from South
Carolina Research Authority (SCRA) in the form of a grant. The value of the lease is
US$200,000 to lease equipment including forklift, lab equipment and computers of which assets
to the full value have been received by Alexium Inc during the year ended 30 June 2011. This
amount is being recognised as income over three years. The repayments are nil per month for 3
years with a buyout option at the end of the period or return the equipment. This agreement has
been extended for 24 months to June 1 2015. Alexium Inc are currently reviewing the buyout
option.
The Group had no other commitments as at 30 June 2014.
(b) Contingencies
The Group has no other contingent liabilities as at 30 June 2014.
76
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
ALEXIUM INTERNATIONAL GROUP LIMITED
26. DIVIDENDS
No dividend has been declared or paid during the current financial year or the prior financial year.
The Group does not have any franking credits available for current or future years as it is not in a
tax paying position.
27. SUBSEQUENT EVENTS
The Series A convertible notes matured on 30 August 2014 and 7,610,267 shares were issued on
conversion of 6,430,000 convertible notes. In addition 750,000 unlisted options exercisable at $0.18 and
expiring on 31 August 2017 were issued in August 2014.
On 21 August 2014 the Company announced it had received a grant of $250,000 from the South
Carolina/Israel Collaborative Industry R & D Programme.
Except for the above no other significant event has occurred since the end of the financial year that may
have a significant impact on the financial position of the Group.
77
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DIRECTORS’ DECLARATION
The Directors of the Company declare that:
1.
the financial statements, comprising the consolidated statement of profit or loss and other comprehensive
income, the consolidated statement of financial position, the consolidated statement of cash flows, the
consolidated statement of changes in equity and accompanying notes, as set out on pages 28 to 77 are in
accordance with the Corporations Act 2001 and:
(a)
comply with Accounting Standards and the Corporations Regulations 2001; and
(b) give a true and fair view of the Group’s financial position as at 30 June 2014 and of its performance
for the year ended on that date;
2.
the Group has included in the notes to the financial statements an explicit and unreserved statement of
compliance with International Financial Reporting Standards
3.
the Chief Executive Officer has declared that:
(a)
the financial records of the Company for the financial year have been properly maintained in
accordance with section 286 of the Corporations Act 2001;
(b)
the financial statements and notes for the financial year comply with the Accounting Standards;
(c)
the financial statements and notes for the financial year give a true and fair view; and
(d)
the remuneration disclosures contained in the Remuneration Report comply with s300A of the
Corporations Act 2001.
the remuneration disclosure set out on pages 10 to 21 of the Directors’ report (as part of the audited
Remuneration Report) for the year ended 30 June 2014, comply with section 300A of the Corporations Act
2001.
in the Directors’ opinion there are reasonable grounds to believe that the Company will be able to pay its
debts as and when they become due and payable.
4.
5.
This declaration is made in accordance with a resolution of the Board of Directors.
Gavin Rezos
Executive Chairman
Perth, 30th September 2014
78
For personal use only
For personal use only For personal use only ADDITIONAL INFORMATION
ALEXIUM INTERNATIONAL GROUP LIMITED
The distribution of members and their holdings at 22 September 2014 was as follows:-
NAME OF 20 LARGEST ORDINARY SHAREHOLDERS
Piper Buchanan Limited
Aymon Pacific Pty Ltd
JP Morgan Nominees Australia Ltd
ABN Amro Clearing Sydney Nominees Pty Ltd
Korcula (BVI) S A
HSBC Custody Nominees (Australia) Limited - A/C 3
HSBC Custody Nominees (Australia) Limited - A/C 2
Gavin and Joanne Rezos
Peter Bartter
Peter Macskasy Barnes
Seafield Superannuation Pty Ltd
Himstedt Superannuation Pty Ltd
Mr A B Utturkar & Mrs R A Utturkar
Geonicclark Pty Ltd
Vellelonga International Pty Ltd
Mr Ian Davies
Mr Egan Johnson
Mr Alan Dean
HSBC Custody Nominees (Australia) Limited
David Rivett Pty Ltd
*
*
*
NUMBER OF
ORDINARY
FULLY PAID
SHARES HELD
14,163,000
13,096,471
12,526,828
7,760,980
4,812,000
4,701,267
4,507,662
4,320,185
3,861,339
3,444,000
3,038,189
2,928,319
2,522,704
2,099,900
2,075,000
2,001,371
1,753,116
1,385,609
1,349,274
1,280,295
93,627,509
% HELD OF
ISSUED
ORDINARY
CAPITAL
6.72
6.21
5.94
3.68
2.28
2.23
2.14
2.05
1.83
1.63
1.44
1.39
1.20
1.00
0.98
0.95
0.83
0.66
0.64
0.61
44.41
MARKETABLE PARCEL
SUBSTANTIAL SHAREHOLDERS
At 22 September 2014, 157 shareholders held less
than a marketable parcel.
Shares held by substantial shareholders listed in
the company's register at 22 September 2014 are
indicated by * above.
VOTING RIGHTS – ORDINARY SHARES
STOCK EXCHANGE LISTING
Each ordinary share is entitled to one vote when a
poll is called, otherwise each member present at a
meeting or by proxy has one vote on a show of
hands.
Quotation has been granted for all the ordinary
shares of the company on all Member Exchanges
of the Australian Stock Exchange Ltd.
Quotation has been granted on the Frankfurt
Exchange
Alexium is fully quoted on the OTCQX
DISTRIBUTION OF SHAREHOLDERS
1
1,001
5,001
10,001
- 1,000 shares
- 5,000 shares
- 10,000 shares
- 100,000 shares
100,001 and over
Total Ordinary Shareholders
Shareholders
146
68
128
686
312
1,340
81
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