ANNUAL
REPORT
2021
2
Contents
Contents ..........................................................................................................................................................................2
Corporate Directory ....................................................................................................................................................3
Chair’s Letter ................................................................................................................................................................ 4
Review of Operations and Activities .....................................................................................................................7
Directors’ Report........................................................................................................................................................ 10
Auditor’s Independence Declaration .................................................................................................................. 28
Corporate Governance Statement ....................................................................................................................... 29
Financial Report – 30 June 2021 .......................................................................................................................... 30
Independent Auditor’s Report .............................................................................................................................. 68
Shareholder Information .........................................................................................................................................71
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Corporate Directory
Directors
Secretary
Registered office and principal
place of business
Dr David Brookes
Non-Executive Chair
Ms Sue MacLeman
Non-Executive Director
Dr Jane Ryan
Non-Executive Director
Mr Stephen Denaro
Level 3, 62 Lygon Street
Carlton South VIC 3053 Australia
Telephone: +61 (0)3 9824 5454
Share register
Computershare Investor Services Pty Limited
Auditor
Solicitors
Bankers
Level 1, 200 Mary Street
Brisbane QLD 4000
+61 (0)7 3237 2100
Grant Thornton Audit Pty Ltd
Collins Square
Tower 5, 727 Collins Street
Melbourne VIC 3008
Telephone: +61 (0)3 8320 2222
Thomson Geer
Level 16, Waterfront Place
1 Eagle Street
Brisbane QLD 4000
Commonwealth Bank of Australia
Melbourne VIC 3000
Stock exchange listings
Anatara Lifesciences Ltd shares are listed on the
Australian Securities Exchange (ASX code: ANR)
Website
www.anataralifesciences.com
ANNUAL REPORT 2021
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Chair’s Letter
Dear Shareholders,
On behalf of the Board of Directors, I am pleased to present Anatara’s Annual Report for the year 2021. It has
been a year of significant progress working towards commercialisation of the GaRP (Gastrointestinal
ReProgramming) pipeline for human health products and unlocking the relevance of the animal health
products. Moreover, the Company is well placed to address broader gastrointestinal (GIT or “gut”) human
health issues and the significant unmet need for evidence-based solutions and advice for many sufferers of
GIT symptoms and disorders.
Gastrointestinal disorders and symptoms are extremely prevalent, with 59% of the global population
experiencing digestive health issues on a weekly basis . People are looking for safe and effective solutions to
digestive complaints and our aim is now focused on delivering evidence-based treatments, solutions and advice
for gastrointestinal health needs. Developing GaRP (Gastrointestinal ReProgramming) as a complementary
medicine to address intestinal symptoms and disorders has given an insight into both the needs of consumers
and patients, and also the degree of anecdotal treatments and misinformation that abounds.
GaRP is the working name for Anatara’s evidence based complementary medicine using unique formulations
of bromelain, an enzyme extracted from pineapple stems along with other synergistic GRAS components.
The combination and coating of these GaRP components have a beneficial effect on the physiology of the
GIT lining, a positive influence on the microbiome (homeostasis & metabolites) and allows absorption of
components in targeted areas of the GIT. GaRP’s multimodal activity provides a versatility for tailoring the
components to various indications and specifically this year we have progressed two human trials which are
commencing in August/October 2021.
While COVID had a significant impact on Anatara’s programme, most directly by delaying the manufacturing
of GaRP and the trial placebo, we have used the time to advance our understanding of other indications for
the GaRP program. There are both significant unaddressed areas of need and other indications that we are
excited to address following the initial trials (assuming favourable efficacy with safety already considered).
Additionally, we have turned our attention to broader GIT considerations and are looking at other
opportunities to offer consumers and patients solutions to GIT complaints. With the trials unfolding, Anatara
will upgrade our capacity for those interested to follow the company’s progress and provide a forum for
access to news and eventually advice.
Human Trials
Dose Determination and Efficacy Evaluation of the Gastrointestinal ReProgramming
(GaRP) Dietary supplement in Irritable Bowel Syndrome -Diarrhoea subtype (IBS-D)
This randomised, double-blind, placebo-controlled study, commenced in August 2021, is being conducted
in two stages as a virtual study. This involves minimal on-site visits and participants completing assessments
online. Up to 6 sites will be established and approximately 200 participants enrolled. The study design
consists of two stages with an interim analysis between stages. Stage 1 is anticipated to be completed in
March 2022. Stage 2 is anticipated to be completed in September 2022.
Stage 1 will assess safety, tolerability, and be a guide to the efficacy of the two different strengths of GaRP
used against a placebo, randomly divided in a protocol of 3 equal groups. Following interim analysis, one
dose will be selected, and the remaining participants recruited in a 1:1 randomisation protocol. Of the 200
ANATARA LIFESCIENCES
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planned participants, at least 90 will enrol in stage 1, and 110 participants will enrol in stage 2. For each
participant in each stage, the study will last for 12 weeks; including 8 weeks of treatment, preceded by a 2-
week screening/baseline period and followed by a 2-week washout period. Measurements will include a
number of surveys including the IBS specific surveys: IBS-SSS (severity scoring system), IBS-AR (adequate
relief) and Bristol Stool Form Scale. Other surveys will look at overall well-being, such as the IBS QoL (quality
of life) and HADS (Hospital Anxiety and Depression Scale) in recognition of the importance of the gut-brain
connection. The usual and expected clinical markers will all be monitored, including microbiome analysis.
Irritable Bowel Syndrome (IBS) is the most diagnosed gastrointestinal condition and a significant burden on
healthcare. Over US$8 billion is spent annually on supplements and OTC digestive remedies in the US alone,
presenting a huge market opportunity for Anatara. Our human health products will be built on strong
scientific foundations for credibility and consumer confidence that provides a marketing distinction. The pre-
clinical data to support the use of GaRP is very robust and our expectation is that this will translate in the
human IBS-D trial. It is anticipated that GaRP's mechanism of action will relieve symptoms of IBS by reducing
inflammation and assisting repair of the gut lining, and positively influencing the homeostasis and metabolites
of the microbiome.
CSIRO trial -the “Gut-brain connection “using Anatara’s 3FDC
from GaRP pipeline
Anatara’s GaRP pipeline not only addresses GIT homeostasis but more general harmony and well-being
through influences on the gut -brain connection. In partnership with the CSIRO, Anatara is utilising our 3FDC
as a specific complementary medication, coated to release in the large intestine, to explore the effect on
depression, anxiety and stress-related symptoms in otherwise healthy individuals. Again, the method of action
implied is absorption of key components, a positive influence on the microbiome homeostasis and assisting
the gut wall function.
The study into the effects of 3FDC in adults with moderate anxiety, stress or depression is anticipated to
commence in October 2021 and be completed by April 2022. This randomised, double-blinded, placebo-
controlled study will be conducted at CSIRO’s Nutrition and Health Research Clinic in Adelaide.
Approximately 100 participants will be randomised in a 1:1 manner to treatment with 3FDC or placebo which
is dosed twice a day for 6 weeks. Participants will be assessed at the start and end of the study period ‘in-
clinic’ and will complete a series of questionnaires on a customised smartphone app over the duration of
the study. In the event of tightening COVID-19 restrictions impacting ‘in-clinic’ visits, the study will transition
to a virtual study with telehealth consultations. Such a transition is not anticipated to impact the primary
outcome. The primary outcome is a clinically significant reduction in Hospital Anxiety and Depression Scale
(HADS) scores. The study is powered at ~95% to detect a clinically relevant reduction of ≥1.5 points in HADS
scores from baseline to end of treatment (6 weeks) with significance set at 5%1 . Secondary outcomes
include mood and wellbeing questionnaires, gut symptom ratings and blood plasma markers.
In parallel with the trials progress, commercialization discussions continue for the GaRP pipeline products.
Animal Health
Antara’s animal health assets were developed to control scour in piglets, a disorder which costs farmers
worldwide millions of dollars every year. A current practice to control outbreaks is to administer zinc oxide
to weaned piglet diets, however, its widespread use can result in risk to the environment through
accumulation, and antimicrobial resistance similar to antibiotics. For these reasons, there has been a global
trend towards reducing the reliance on zinc oxide and an increasing demand for a safe and effective non-
antibiotic solution in piglets and other livestock. The use of medicinal zinc oxide to prevent diarrhoea post-
weaning will be banned in the EU from 2022.
ANNUAL REPORT 2021
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Our Detach® product is approved by the Australian Pesticides and Veterinary Medicines Authority (APVMA)
for use in piglets in Australia. BONIFF is our bromelain-based in-feed formulation for piglets. We were
encouraged by the results of the piglet challenge study in August 2021, which we aim to leverage to partner
our bromelain-based animal health portfolio. The trial report concluded that BONIFF could be considered as
a replacement for the current practice of using non-physiological levels of zinc oxide combined with
commercial levels of additives in a semi-moist extruded creep piglet diet. While the commercial opportunity
here is still being established, the initial indications are that BONIFF can be added to feed at a significant
saving per tonne compared to the current regime of non-physiological levels zinc oxide combined with
commercial levels of additives, such as organic acids.
Anatara’s bromelain-based portfolio also includes ANR-pf, which is a proprietary enriched formulation to
address poultry gut illnesses, delivered in water. This is designed to allow the full delivery of key additives in
a quick and flexible dosing method on-farm even when stock illness is a concern. Following successful
completion of the poultry challenge trial “Efficacy of ANR-pf on the performance of broilers subject to
subclinical and necrotic enteritis challenges”, Anatara is actively seeking commercial partners.
Positive outlook for FY22
As you are aware, I was appointed Chairman of the Anatara Board in July, as Sue MacLeman transitioned to
a Non-Executive Director role. I take this opportunity to acknowledge Sue’s significant contribution to the
Company thus far, as Chair over a three-year period, and look forward to continuing to work with her and
Dr. Jane Ryan as a small board focused and dedicated to rewarding shareholder patience and restoring value
to the share price.
I would also like to acknowledge the service provided by Dr Tracie Ramsdale, who retired from the Board in
October 2020 after six years, including a period where she acted as interim CEO, prior to Steve Lydeamore’s
appointment in 2019.
FY22 has the two current human clinical trials, underway after significant delays due to the COVID-19 pandemic.
These trials will, of course, strongly influence both our commercial discussions and the plans for the use of the
GaRP pipeline across other GIT indications. We look forward to working through these outcomes which will
shape that pipeline and the company’s immediate future. We will also be looking to expand Anatara’s position
and profile as an emerging leader in evidence -based GIT health solutions. I would like to thank our team for
their dedicated efforts during FY21 particularly given the challenges we faced with the COVID-19 pandemic and
to thank my fellow Directors whose guidance and insights have been invaluable.
Following the capital raising activities in late 2021, which in total raised $2.86 million (net of costs), Anatara
enters the 2022 financial year with a strong balance sheet well-funded to progress the 2 human trials using
the GaRP pipeline (IBS-D and 3FDC in psychological functioning) and to assess other opportunities.
On behalf of the Board, I would like to thank all our shareholders for your continued support, and I look
forward to updating you on our progress.
Yours sincerely,
Dr David Brookes
Non-Executive Chair
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Review of Operations and Activities
Dear Shareholders,
2021 has been a significant year for Anatara, as we made steps towards progressing our human health
products towards clinical trials, successfully completed animal health studies and progressed licensing
discussions. There appears to be a wider appreciation of our human health initiatives with a focus on
restoration and maintenance of gastrointestinal tract homeostasis to improve overall wellbeing.
Operational review
Human Health
An important milestone was achieved in February, when we received ethics approval to commence the
human trial for the treatment of a sub-type of irritable bowel syndrome (IBS) using our Gastrointestinal
ReProgramming (GaRP) complementary medicine. This randomised, double-blind, placebo-controlled trial
will be conducted in two stages as a virtual trial, with minimal on-site visits and participants completing
assessments online. The trial will use up to six sites and approximately 200 participants will enrol. Due to a
scheduling delay in availability of the placebo from reduced manufacturing shifts under COVID-19
restrictions, recruitment for the trial is now commencing in August 2021 with an interim readout anticipated
in March 2022. The trial is anticipated to be completed in September 2022.
In April, we also received approval from the Human Research Ethics Committee to undertake a human trial
on the effects of 3FDC dietary supplementation on psychological functioning in adults. This randomised,
double-blinded, placebo-controlled study will be undertaken with CSIRO in Adelaide. 3FDC is the Company’s
name for 3 specific components of the GaRP programme that are coated for delivery beyond the small
intestine.
3FDC is targeted to release from the junction between the small and large intestine (ileocecal junction) and
exert its effects on the microbiome in the large intestine. The coated delivery of these 3FDC components to
the large intestine is considered important for gut-brain axis balance, in part due to influences on microbiome
homeostasis and metabolites. The CSIRO will run a clinical trial with 3FDC to observe effects on depression,
anxiety and stress symptoms in otherwise healthy individuals.
The CSIRO team will develop the work guidelines and initiate recruitment with the aim of dosing the first
participants in October 2021. The trial is anticipated to be completed in April 2022.
Animal Health
During the year we substantially progressed our animal health studies, where we are targeting the need for
growth enhancement feed products, without antibiotics or zinc oxide.
Our activities prioritised removing barriers to out-licensing Detach® through the progression of challenge
trials for our piglet and poultry formulations.
ANNUAL REPORT 2021
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In February, we announced the successful completion of the poultry challenge trial testing “Efficacy of ANR-
pf on the performance of broilers subject to subclinical and necrotic enteritis challenges”. ANF-pf is our
proprietary enriched formulation for poultry in water, designed to allow the full delivery of key additives in a
quick and flexible dosing method. The study was a randomised, placebo controlled trial. The parameters
analysed were bird weight gain, feed intake, feed conversion ratio and other complex parameters. The initial
results were extremely encouraging, with statistical significance demonstrated across multiple parameters.
Further work to optimise the dose and dosing regimen are required to fully understand the commercial
opportunity and the product’s value.
The BONIFF-SMEC piglet challenge study for Escherichia Coli commenced in April and was completed in
June, at Murdoch University. BONIFF-SMEC is our formulated feed additive in Ridley Corporation’s semi-
moist extruded creep feed for piglets. We were delighted to receive the results of the piglet challenge study
in August 2021, which we aim to leverage to partner our bromelain-based animal health portfolio.
Pleasingly, we could conclude that under the conditions of the proof-of-concept study, BONIFF could be
considered as a replacement for zinc oxide with commercial levels of additives, in a semi-moist extruded
creep (SMEC) piglet diet . While the commercial opportunity here is still being established ,the initial
indications are that BONIFF can be added to feed at a significant saving per tonne compared to the current
regime of non-physiological levels zinc oxide combined with commercial levels of additives such as organic
acids.
Medicinal use of zinc oxide will be banned in Europe from 2022 and Canada recently announced their intent
to follow the European Union’s lead, which implies that there is a strong, and currently unmet, demand for
alternatives. It was highly encouraging that performance (weight gain) was maintained for the BONIFF group,
compared to the standard diet.
Patent for Detach®
In April, we were granted a patent for our Detach® animal health product, which strengthened our
intellectual property position in the treatment of, and prevention of, diarrhoea caused by pathogenic
microbes. The patent provides the pathway for us to further pursue commercialisation opportunities and
expires on 24 August 2038. With scour in piglets being an expensive, debilitating, and in some cases, life-
threatening condition, having a product that is registered for use in Australia places us in a strong position to
work towards a commercial deal.
Partnering discussions
During the year we progressed licensing discussions for GaRP with international consumer health
companies. We are highly encouraged by our discussions to date with potential partners, and following the
completion of our IBS human trial in September 2022, we expect to be in a really strong position to announce
a commercial partnership. There is potential for an earlier partnership if interim results, anticipated in March
2022, indicate a strong trend towards a statistically significant benefit . Given the size of the complementary
medicine market for gastrointestinal health products that address a spectrum of symptoms and disorders,
the GaRP pipeline can add substantially to the overall shareholder value. Anatara intends to seek licensing
agreements and partnerships with established consumer health companies rather than contemplate direct
marketing and distribution.
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Financial position
Despite the delays to the commencement of our human trials, we remain in a robust financial position,
ending FY21 with cash at bank of $3.4 million (up from $2.7 million on 30 June 2020). Our balance sheet
provides significant scope for us to undertake both human trials and pursue initiatives to partner both our
human and animal health assets.
During the year to 30 June 2021, the Company made significant steps towards taking its first human
gastrointestinal health product, GaRP, to market. Expenditure in furthering this effort resulted in a loss after
tax of $1,995,874 for the period (2020: $3,364,644).
I would like to thank our team for all their hard work over FY21. The commitment and determination in these
unprecedented times gives us great confidence that we can continue to execute to our strategic plan in
FY22 and beyond.
I would also like to thank our shareholders for your continued commitment, and we look forward to updating
you further at our upcoming Annual General Meeting.
Your sincerely,
Steve Lydeamore
Chief Executive Officer
ANNUAL REPORT 2021
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Directors’ Report
Your directors present their report on the consolidated entity consisting of Anatara Lifesciences Ltd and the
entities it controlled at the end of, or during, the year ended 30 June 2021. Throughout the report, the
consolidated entity is referred to as the group.
Directors and company secretary
The following persons held office as directors of Anatara Lifesciences Ltd during the whole of the financial
year and up to the date of this report, except where otherwise stated:
(cid:120) Dr David Brookes, Non-Executive Chair (transitioning from Non-Executive Director on 26 July 2021)
(cid:120) Ms Sue MacLeman, Non-Executive Director (transitioning from Non-Executive Chair on 26 July 2021)
(cid:120) Dr Jane Ryan, Non-Executive Director
(cid:120) Dr Tracie Ramsdale, Non-Executive Director (resigned 26 November 2020)
The following persons held office as company secretary of Anatara Lifesciences Ltd during the whole of the
financial year and up to the date of this report, except where otherwise stated:
(cid:120) Mr Stephen Denaro
Principal activities
The group is developing evidence based solutions for gastrointestinal diseases in animals and humans,
including GaRP for irritable bowel syndrome and 3FDC for anxiety, stress or depression.
Dividends - Anatara Lifesciences Ltd
No dividends were declared or paid to members for the year ended 30 June 2021. The directors do not
recommend that a dividend be paid in respect of the financial year.
Review of operations
Information on the operations and financial position of the group and its business strategies and prospects
is set out in the review of operations and activities on pages 7 to 9 of this annual report.
Significant changes in the state of affairs
There have been no significant changes in the state of affairs of the group during the year.
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Events since the end of the financial year
On 26 July 2021, the group announced the transition of Dr David Brookes from Non-Executive Director to
Chairman. Ms Sue MacLeman will continue on the Board, transitioning from Chair to Non-Executive Director.
On 13 August 2021, the group has issued 449,781 ordinary shares to Mr Steven Lydeamore as a result of
exercise of his performance rights. Furthermore, the group has issued 336,113 performance rights with nil
exercise price and expiring on 23 August 2024 under the Executive Option Plan.
No other matter or circumstance has arisen since 30 June 2021 that has significantly affected the group's
operations, results or state of affairs, or may do so in future years.
Likely developments and expected results of operations
Other than the information disclosed in the review of operations and activities on pages 7 to 9, there are no
likely developments or details on the expected results of operations that the group has not disclosed.
Environmental regulation
The group is not affected by any significant environmental regulation in respect of its operations.
ANNUAL REPORT 2021
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Information on directors
The following information is current as at the date of this report.
Dr David Brookes, Non-Executive Chair
(transitioning from Non-Executive Director on 26 July 2021)
Experience and expertise
Other current public
directorships
Dr. Brookes has extensive experience in the health and biotechnology
industries, first becoming involved in the biotechnology sector in the
late 1990’s as an analyst. Dr. Brookes has since held Board positions
in a number of ASX listed biotechnology companies, including as
Chairman of genomics solutions company, RHS Ltd, which was
acquired by PerkinElmer Inc (NYSE: PKI) in June 2018. He has also
Chaired the risk and audit committees in ASX listed companies. He is
currently a Non-Executive Chairman of Factor Therapeutics (ASX:
FTT) and a Non-Executive Director of Island Pharmacuticals (ASX:ILA)
and TALI Digital (ASX:TD1). He was Non-Executive Chairman of the
Better Medical group (unlisted) until the sale of that company to
private equity firm Livingbridge in January 2021.
Dr. Brookes maintains roles as a clinician and as a biotechnology
industry consultant. Dr Brookes, MBBS (Adelaide), is a Fellow of the
Australian College of Rural and Remote Medicine and a Fellow of the
Australian Institute of Company Directors.
(cid:120)
(cid:120)
(cid:120)
Factor Therapeutics Limited (ASX: FTT), since 10 April 2019
Tali Digital Ltd (ASX: TD1), since 29 June 2020
Island Pharmaceuticals Limited (ASX:ILA) since October 2020
Former public directorships
in last 3years
None
Special responsibilities
(cid:120) Chair of Board since 26 July 2021
(cid:120) Chair of the audit and risk management committee Member
of the remuneration and nominations committee
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Ms Sue MacLeman, Non-Executive Director
(transitioning from Non-Executive Chair on 26 July 2021)
13
Experience and expertise
Ms Sue MacLeman has more than 30 years’ experience as a
pharmaceutical, biotechnology and medical technology executive
with senior roles in corporate, medical, commercial and business
development. Sue has served as CEO and Board member of several
ASX and NASDAQ listed companies in the sector.
Sue MacLeman is currently Non-Executive Director (and former Chair)
- Anatara Lifesciences (ASX:OVN), Chair of Tali Digital Ltd (ASX:TD1),
Non-Executive Director of Palla Pharma Ltd (ASX:PAL), Non-Executive
Director of Planent Innovation Holdings and Non-Executive Director
of Omico.
Sue is also appointed to a number of academic and government
advisory committees including the Prime Ministers Digital Expert
Advisory Board, Australian Advisory Board of Technology and
Healthcare Competitiveness, CSIRO Health and Biosecurity Advisory
Committee, the Genomics Health Futures Expert Advisory Committee
(MRFF), various Covid-19 taskforces, the DMTC Strategic Advisory
Medical Countermeasures Committee and the Asialink Business
Taskforce. Sue is also Chair of ATSE Health Technology Forum and
ATSE Policy Committee.
Her broad commercial experience is underpinned by graduate
qualifications in pharmacy and post graduate qualifications in
corporate governance, commercial law, business administration and
marketing.
Other current public
directorships
(cid:120)
Tali Digital Ltd (ASX: TD1), since 6 September 2018
(cid:120) Oventus Medical Ltd (ASX: OVN), since 27 November 2015
(cid:120)
Palla Pharma Limited (ASX: PAL), since 27 November 2018
Former public directorships
in last 3years
None
Special responsibilities
(cid:120) Chair of Board until 26 July 2021
(cid:120) Member of the audit and risk management committee
(cid:120) Member of the remuneration and nominations committee
ANNUAL REPORT 2021
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Dr Jane Ryan, Non-Executive Director
Experience and expertise
Other current public
directorships
Jane has over 30 years of international experience in the
pharmaceutical and biotechnology industries where she has held
executive roles in management of research and development
programs as well as business development and alliance management.
Jane has worked in Australia, the United States and United Kingdom
with companies including Peptech, Roche, Cambridge Antibody
Technology and Biota Holdings.
Throughout her career, she has led many successful fundraising
campaigns and licensing initiatives including the winning of a $230
million US Government contract.
Jane was Chair of the Advisory Board at the ithree Institute at the
University of Technology Sydney (UTS) which studies how microbes
grow, live, adapt and survive. Jane has been a Board Member of the
government and not for profit organisations and is currently Non-
Executive Director of Bionomics Limited (ASX: BNO).
(cid:120)
Bionomics Ltd (ASX:BNO) since 1 October 2020
Former public directorships
in last 3years
None
Special responsibilities
(cid:120) Member of the audit and risk management committee
(cid:120) Chair of the remuneration and nominations committee
Company secretary
The company secretary is Mr Stephen Denaro, appointed to the position on 24 February 2014. Stephen has
extensive experience in mergers and acquisitions, business valuations, accountancy services, and income
tax compliance gained from positions as Company Secretary and Chief Financial Officer of various public
companies and with major chartered accountancy firms in Australia and the United Kingdom. He provides
company secretarial services for a number of start-up technology and ASX listed and unlisted public
companies.
Stephen has a Bachelor of Business in accountancy, Graduate Diploma in Applied Corporate Governance
and is a member of the institute of Chartered Accountants in Australia and the Australian Institute of
Company Directors.
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Meetings of directors
The numbers of meetings of the company's board of directors and of each board committee held during
the year ended 30 June 2021, and the numbers of meetings attended by each director were:
Director
Dr David Brookes
Ms Sue MacLeman
Dr Jane Ryan
Dr Tracie Ramsdale1
Full Meetings of
Directors
Audit
Committee
Remuneration
Committee
A
13
12
13
6
B
13
13
13
6
A
2
2
2
1
B
2
2
2
1
A
1
1
1
1
B
1
1
1
1
1. Dr Tracie Ramsdale resigned on 26 November 2020.
A = Number of meetings attended
B = Number of meetings held during the time the director held office or was a member of the committee during the year
Remuneration report (audited)
The directors present the Anatara Lifesciences Ltd 2021 remuneration report, outlining key aspects of our
remuneration policy and framework, and remuneration awarded this year.
The report is structured as follows:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
Key management personnel (KMP) covered in this report
Remuneration policy and link to performance
Elements of remuneration
Link between remuneration and performance
Remuneration expenses
Contractual arrangements with executive KMPs
Non-executive director arrangements
Additional statutory information
(a)
Key management personnel covered in this report
Non-executive and executive directors (see pages 12 to 14 for details about each director)
(cid:120) Dr David Brookes, Non-Executive Chair (transitioning from Non-Executive Director on 26 July 2021)
(cid:120) Ms Sue MacLeman, Non-Executive Director (transitioning from Non-Executive Chair on 26 July 2021)
(cid:120) Dr Jane Ryan, Non-Executive Director
(cid:120) Dr Tracie Ramsdale, Non-Executive Director (resigned 26 November 2020)
(cid:120) Mr Steven Lydeamore, Chief Executive Officer
(cid:120) Dr Michael West, Chief Operating Officer
ANNUAL REPORT 2021
16
(b)
Remuneration policy and link to performance
Our remuneration and nominations committee is made up of independent non-executive directors. The
committee reviews and determines our remuneration policy and structure annually to ensure it remains
aligned to business needs, and meets our remuneration principles. In particular, the board aims to ensure
that remuneration practices are:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
competitive and reasonable, enabling the company to attract and retain key talent
aligned to the company's strategic and business objectives and the creation of shareholder value
transparent and easily understood, and
acceptable to shareholders.
Element
Purpose
Performance metrics
Potential value
Fixed
remuneration (FR)
Provide competitive
market remuneration
Nil
STI
LTI
Reward for in-year
performance and
retention
KPI achievement,
determined by
remuneration and
nominations committee
Alignment to long-
term shareholder value
KPI achievement,
determined by
remuneration and
nominations committee
Positioned at the market
rate
CEO: 40% of FR COO:
30% of FR
CEO: 600,000 unlisted
5-year options at $0.736
exercise price
COO: 210,000 unlisted
5-year options at $1.70
exercise price
Assessing performance
The remuneration and nominations committee is responsible for assessing performance against KPIs and
determining the STI and LTI to be paid. To assist in this assessment, the committee receives data from
independently run surveys.
Performance is monitored on an informal basis throughout the year and a formal evaluation is
performed annually.
Securities trading policy
Anatara Lifesciences Ltd's securities trading policy applies to all directors and executives, see
https://anataralifesciences.com/investors/corporate-governance/. It only permits the purchase or sale of
company securities during certain periods.
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(c)
(i)
Elements of remuneration
Fixed annual remuneration (FR)
Key management personnel may receive their fixed remuneration as cash, or cash with non-monetary
benefits such as health insurance and car allowances. FR is reviewed annually, or on promotion. It is
benchmarked against market data for comparable roles in companies in a similar industry and with similar
market capitalisation. The committee aims to position executives at or near the median, with flexibility to
take into account capability, experience, value to the organisation and performance of the individual.
(ii)
Short-term incentives
All executives are entitled to participate in a short-term incentive scheme which provides for executive
employees to receive a combination of short-term incentive (STI) as part of their total remuneration if they
achieve certain performance indicators as set by the board. The STI can be paid either by cash, or a
combination of cash and the issue of equity in the company, at the determination of the remuneration and
nominations committee and board.
The company's CEO and COO are entitled to short-term incentives in the form of cash bonus up to 40%
and 30% of FR, respectively, against agreed various key performance indicators (KPIs), including target
EBITDA, appreciation in share price value, retention of key talent, and achievement of major project
milestones.
On an annual basis, KPIs are reviewed and agreed in advance of each financial year and include financial and
non-financial company and individual performance goals that relate to:
(cid:120) Operational management
(cid:120)
(cid:120)
(cid:120)
Investor relations and shareholder value creation
R&D activities
Product development and commercialisation
(iii)
Long-term incentives
Executives may also be provided with longer-term incentives through the company's 'executive option plan'
(EOP), that was approved by shareholders at the annual general meeting held on 26 November 2020. The
aim of the EOP is to allow executives to participate in, and benefit from, the growth of the company as a
result of their efforts and to assist in motivating and retaining those key employees over the long-term.
Continued service is the condition attached to the vesting of the options. The board at its discretion
determines the total number of options granted to each executive.
ANNUAL REPORT 2021
18
(d)
Link between remuneration and performance Statutory performance indicators
We aim to align our executive remuneration to our strategic and business objectives and the creation of
shareholder wealth. The table below shows measures of the group's financial performance over the last five
years as required by the Corporations Act 2001. However, these are not necessarily consistent with the
measures used in determining the variable amounts of remuneration to be awarded to KMPs. As a
consequence, there may not always be a direct correlation between the statutory key performance measures
and the variable remuneration awarded.
2021
2020
2019
2018
2017
Loss for the year
attributable to owners ($)
Basic loss per share (cents)
Share price at year end ($)
1,995,874
3,364,644
2,868,272
3,569,016
1,705,002
3.18
0.16
6.77
0.13
5.80
0.26
7.22
0.64
3.45
1.00
The company's earnings have remained negative since inception due to the nature of the business.
Shareholder wealth reflects this speculative and volatile market sector. No dividends have ever been declared
by Anatara Lifesciences Ltd. The company continues to focus on revenue growth with the objective of
achieving key commercial milestones in order to add further shareholder value.
ANATARA LIFESCIENCES
(e)
Remuneration expenses
The following tables show details of the remuneration expense recognised for the group's key management
personnel for the current and previous financial year measured in accordance with the requirements of the
accounting standards.
19
Short-term
benefits
Post-
employment
benefits
Long-
term
benefits
Share-based
payments
Cash
salary
and fees1
Cash
bonus
Super-
annuation
Long
service
leave Options2
Performance
Rights
$
$
$
$
$
Total
$
2021
Directors
Dr David Brookes
72,346
Ms Sue MacLeman
135,046
Dr Jane Ryan
72,346
Dr Tracie Ramsdale3
31,940
Other KMP
Mr Steven Lydeamore 382,722
Dr Michael West4
264,013
Total KMP
compensation
958,413
Notes
-
-
-
-
-
-
-
6,873
12,829
6,873
3,034
-
-
-
-
5,156
9,623
5,156
(258)
36,197
6,177
43,808
-
-
-
-
-
84,375
157,498
84,375
34,716
468,904
23,750
5,216
-
45,000
337,979
89,556
11,393 63,485
45,000 1,167,847
1. Cash salary and fees includes estimation of net annual leave entitlement incurred during the current year.
2. Due to COVID-19, Anatara Board resolved to reduce their directors' fees temporarily from May 2020 to September 2020. On 22 June
2020, Anatara Board resolved to grant 761,912 options (subject to approval by shareholders at November 2020 AGM) to KMP and
Company Secretary. However, only a total of 617,704 options were subsequently issued on 3 December 2020 given the shareholders'
approval in the 2020 annual general meeting.
3. Dr Tracie Ramsdale resigned on 26 November 2020 and 68,766 options (total share-based payment expenses of $258 recognised in
prior year) were forfeited during the year.
4. Subsequent to year end, 297,489 performance rights have been issued to Dr Michael West, as part of his performance bonus of
$45,000. These performance rights have nil exercise price and expiring on 23 August 2024.
ANNUAL REPORT 2021
20
(e)
Remuneration expenses (continued)
Short-term
benefits
Post-
employment
benefits
Long-
term
benefits
Share-based
payments
Cash
salary
and fees
Cash
bonus1
Super-
annuation
Long
service
leave Options2
Performance
Rights
$
$
$
$
$
Total
$
2020
Directors
Dr David Brookes
72,635
Ms Sue MacLeman
135,585
Dr Jane Ryan
72,635
Dr Tracie Ramsdale
67,792
Other KMP
-
-
-
-
6,900
12,881
6,900
6,440
-
-
-
-
277
517
277
258
-
-
-
79,812
148,983
79,812
21,896
96,386
Mr Steven Lydeamore
379,807
33,927
36,082
2,035
73,115
95,547
620,513
Dr Michael West
250,000
18,750
23,750
4,328
3,118
64,125
364,071
Dr Tracey Brown3
172,223
23,625
14,159
-
3,118
23,625
236,750
Total KMP
compensation
Notes
1,150,677 76,302
107,112
6,363 80,680
205,193 1,626,327
1. Cash bonus includes estimation of the bonus for the current year and any adjustments to the bonus for prior years.
2. Due to COVID-19, Anatara Board resolved to reduce their directors' fees temporarily from 1 May 2020 to September 2020. On 22 June
2020, Anatara Board resolved to grant 761,912 options (subject to approval by shareholders at November 2020 AGM) to KMP and
Company Secretary. However, only a total of 617,704 options were subsequently issued on 3 December 2020 given the shareholders'
approval in the 2020 annual general meeting.
3. Dr Tracey Brown resigned on 31 January 2020 and 210,000 unlisted options (total value $121,716) were cancelled during the year.
ANATARA LIFESCIENCES
(f)
Contractual arrangements with executive KMPs
21
Name:
Position:
Contract duration:
Notice period:
Fixed remuneration:
Name:
Position:
Contract duration:
Notice period:
Fixed remuneration:
Mr Steven Lydeamore
Chief Executive Officer
Unspecified
6 months by either party
$395,000 per annum, plus 9.5% superannuation
Dr Michael West
Chief Operating Officer
Unspecified
3 months by either party
$250,000 per annum, plus 9.5% superannuation
(g)
Non-executive director arrangements
Non-executive directors receive a board fee and fees for chairing but not participating on board committees,
see table below. They do not receive performance-based pay or retirement allowances. The fees are
exclusive of superannuation. The chair receives double the base fee of other non-executive directors,
reflective of the additional demands and responsibilities of this role.
Fees are reviewed annually by the board taking into account comparable roles and market data provided by
the board’s independent remuneration adviser.
The maximum annual aggregate directors' fee pool limit is $500,000, adopted on initial public offering of
Anatara Lifesciences Ltd on 14 October 2014.
Base fees
Chair
Other non-executive directors
Additional Fees
Audit and risk management committee - chair
Audit and risk management committee - member
Remuneration and nominations committee - chair
Remuneration and nominations committee - member
$140,000
$70,000
$5,000
$0
$5,000
$0
ANNUAL REPORT 2021
22
(h)
Additional statutory information
(i)
Relative proportions of fixed vs variable remuneration expense
The following table shows the relative proportions of remuneration that are linked to performance and those
that are fixed, based on the amounts disclosed as statutory remuneration expense on page 19 above:
Fixed
remuneration
At risk - STI
At risk - LTI
2021
2020
2021
2020
2021
2020
%
%
%
%
94
94
94
101
91
87
-
100
100
100
77
67
76
79
-
-
-
-
-
-
-
-
-
-
-
5
5
10
%
6
6
6
(1)
9
13
-
%
-
-
-
23
27
18
11
Name
Directors
Dr David Brookes
Ms Sue MacLeman
Dr Jane Ryan
Dr Tracie Ramsdale1
Other KMP
Mr Steven Lydeamore
Dr Michael West
Dr Tracey Brown2
1. Dr Tracie Ramsdale resigned on 26 November 2020.
2. Dr Tracey Brown resigned on 31 January 2020.
(ii)
Terms and conditions of the share-based payment arrangements
Options
The terms and conditions of each grant of options affecting remuneration in the current or a future reporting
year are as follows:
Grant date
Vesting and
exercise date
Expiry date
Exercise
price ($)
Value per option
at grant date ($)
Vested (%)
2016-09-23
2019-09-23
2021-09-23
1.7000
2019-04-10
2019-02-18
2024-02-17
0.7360
2019-04-10
2020-02-18
2024-02-17
0.7360
2019-04-10
2021-02-18
2024-02-17
0.7360
2020-06-22
2020-12-03
2022-12-03
0.2476
0.5796
0.2731
0.2731
0.2731
0.0827
100%
100%
100%
100%
100%
ANATARA LIFESCIENCES
23
(iii)
Reconciliation of ordinary shares, performance rights and options held by KMP
Share holdings
2021
Ordinary shares
Balance
at the
start of
the year1
Received on
exercise of
performance
rights
Received
on
exercise
of options
Other
changes2
Balance
at the
end of
the year3
Granted as
remuneration
Dr David Brookes
100,000
Ms Sue MacLeman
12,477
Dr Jane Ryan
49,745
Dr Tracie Ramsdale4
152,424
Mr Steven Lydeamore5
199,457
Dr Michael West
82,599
596,702
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
200,000
300,000
33,333
45,810
133,333
183,078
-
152,424
200,000
399,457
-
82,599
566,666
1,163,368
Notes
1. Balance may include shares held prior to individuals becoming a KMP. For individuals who became a KMP during the year, the balance is
as at the date they became a KMP.
2. Other changes incorporates changes resulting from the acquisition of shares.
3. For a former KMP, the balance is as at the date they cease being a KMP.
4. Dr Tracie Ramsdale resigned on 26 November 2020.
5. Subsequent to year end, Mr Steven Lydeamore has fully exercised 449,781 performance rights into 449,781 ordinary shares with nil
consideration on 13 August 2021.
Option holdings
2021
Options
Balance
at the
start of
the year1
Dr David Brookes
73,677
Ms Sue MacLeman
137,515
Dr Jane Ryan
73,677
Dr Tracie Ramsdale4
68,765
Mr Steven Lydeamore
983,527
Dr Michael West
210,000
1,547,161
Granted as
remuneration Exercised
Other
changes2
Balance
at the end
of the
year3
Vested and
exercisable
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(8,019)
65,658
65,658
(14,967)
122,548
122,548
(8,019)
65,658
65,658
(68,765)
-
-
(41,743)
941,784
941,784
-
210,000
210,000
(141,513)
1,405,648
1,405,648
Notes
1. Balance may include shares held prior to individuals becoming KMP. For individuals who became KMP during the year, the balance is as
at the date they became KMP.
2. Other changes incorporates changes resulting from the expiration/forfeiture of options.On 22 June 2020, Anatara Board resolved to grant
761,912 options (subject to approval by shareholders at November 2020 AGM) to KMP and Company Secretary. However, only a total of 617,704
options were subsequently issued on 3 December 2020 given the shareholders' approval in the 2020 annual general meeting.
3. For a former KMP, the balance is as at the date they cease being a KMP.
4. Dr Tracie Ramsdale resigned on 26 November 2020.
ANNUAL REPORT 2021
24
Performance rights
2021
Performance Rights
Balance at
the start of
the year1
Granted as
remuneration
Exercised
Other
changes2
Balance at
the end of
the year3
Dr David Brookes
Ms Sue MacLeman
Dr Jane Ryan
Dr Tracie Ramsdale4
Mr Steven Lydeamore5
Dr Michael West6
Notes
-
-
-
-
-
-
-
-
-
-
-
449,781
331,204
780,985
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
449,781
331,204
-
780,985
1. Balance may include shares held prior to individuals becoming KMP. For individuals who became KMP during the year, the balance is as
at the date they became KMP.
2. Other changes incorporates changes resulting from the expiration/forfeiture of performance rights.
3. For a former KMP, the balance is as at the date they cease being a KMP.
4. Dr Tracie Ramsdale resigned on 26 November 2020.
5. Subsequent to year end, Mr Steven Lydeamore has fully exercised 449,781 performance rights into 449,781 ordinary shares with nil
consideration on 13 August 2021.
6. Subsequent to year end, 297,489 performance rights have been issued to Dr Michael West, as part of his performance bonus of
$45,000. These performance rights have nil exercise price and expiring on 23 August 2024.
(iv)
Other transactions with key management personnel
There are no other transactions with key management personnel of Anatara Lifesciences Ltd.
(v)
Voting of shareholders at last year's annual general meeting
Anatara Lifesciences Ltd received more than 75 percent of favourable votes on its remuneration report for
the 2020 financial year. The company did not receive any specific feedback at the 2020 annual general
meeting or throughout the year on its remuneration practices.
[This concludes the remuneration report, which has been audited]
ANATARA LIFESCIENCES
25
Shares under options and performance rights
(a)
Unissued ordinary shares
Unissued ordinary shares of Anatara Lifesciences Ltd under option and performance rights at the date of this
report are as follows:
Date options
granted
2016-09-23
2017-11-28
2019-04-10
2020-06-22
2020-11-26
Total
Expiry date
2021-09-23
2022-11-17
2024-02-17
2022-12-03
2023-12-03
Issue price of
shares ($)
Number under
options
1.7000
2.2700
0.7360
0.2476
0.2500
210,000
36,000
600,000
617,704
1,500,000
2,963,704
Date performance
rights granted
2020-08-11
2021-08-04
Total
Expiry date
2023-08-10
2024-08-23
Number under
performance rights
331,204
336,113
667,317
No option holder or performance rights holder has any right under the options or performance rights to
participate in any other share issue of the company or any other entity.
(b)
Shares issued on the exercise of options or performance rights
No ordinary shares of Anatara Lifesciences Ltd were issued during the year ended 30 June 2021 on the
exercise of options granted.
Ordinary shares of Anatara Lifesciences Ltd were issued during the year ended 30 June 2021 on the exercise
of performance rights granted as follows:
Date performance rights granted
Number of shares issued
2020-08-11
Total
127,092
127,092
ANNUAL REPORT 2021
26
Insurance of officers and indemnities
(a)
Insurance of officers
During the financial year, Anatara Lifesciences Ltd paid a premium of $25,000 to insure the directors and
secretaries of the company and its Australian-based controlled entities, and the general managers of each of
the divisions of the group.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may
be brought against the officers in their capacity as officers of entities in the group, and any other payments
arising from liabilities incurred by the officers in connection with such proceedings. This does not include
such liabilities that arise from conduct involving a wilful breach of duty by the officers or the improper use
by the officers of their position or of information to gain advantage for themselves or someone else or to
cause detriment to the company. It is not possible to apportion the premium between amounts relating to
the insurance against legal costs and those relating to other liabilities.
(b)
Indemnity of auditors
Anatara Lifesciences Ltd has agreed to indemnify their auditors, Grant Thornton Audit Pty Ltd, to the extent
permitted by law, against any claim by a third party arising from Anatara Lifesciences Ltd's breach of their
agreement. The indemnity stipulates that Anatara Lifesciences Ltd will meet the full amount of any such
liabilities including a reasonable amount of legal costs.
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 company, or to intervene in any proceedings to which the company is a party,
for the purpose of taking responsibility on behalf of the company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the company with leave of the Court under
section 237 of the Corporations Act 2001.
ANATARA LIFESCIENCES
27
Non-audit services
The company may decide to employ the auditor on assignments additional to their statutory audit duties
where the auditor's expertise and experience with the company and/or the group are important. Details of
the amounts paid or payable to the auditor (Grant Thornton Audit Pty Ltd) for audit and non-audit services
provided during the year are set out below.
The board of directors has considered the position and, in accordance with advice received from the audit
committee, is satisfied that the provision of the non-audit services is compatible with the general standard
of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the
provision of non-audit services by the auditor, as set out below, did not compromise the auditor
independence requirements of the Corporations Act 2001 for the following reasons:
(cid:120)
(cid:120)
all non-audit services have been reviewed by the audit committee to ensure they do not impact the
impartiality and objectivity of the auditor
none of the services undermine the general principles relating to auditor independence as set out in
APES 110 Code of Ethics for Professional Accountants.
During the year the following fees were paid or payable for non-audit services provided by the auditor of the
parent entity, its related practices and non-related audit firms:
Grant Thornton Audit Pty Ltd and its related entities and
other Grant Thornton network firms:
Tax compliance services
Total remuneration for taxation services
Total remuneration for non-audit services
Auditor's independence declaration
2021
$
35,000
35,000
35,000
2020
$
34,350
34,350
34,350
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act
2001 is set out on page 28.
Rounding of amounts
The company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the 'rounding off' of
amounts in the directors' report. Amounts in the directors' report have been rounded off in accordance with
the instrument to the nearest dollar.
This report is made in accordance with a resolution of directors.
Dr David Brookes
Non-Executive Chair
Melbourne, 23 August 2021
ANNUAL REPORT 2021
Collins Square, Tower 5
727 Collins Street
Melbourne VIC 3008
Correspondence to:
GPO Box 4736
Melbourne VIC 3001
T +61 3 8320 2222
F +61 3 8320 2200
E info.vic@au.gt.com
W www.grantthornton.com.au
Auditor’s Independence Declaration
To the Directors of Anatara Lifesciences Ltd
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Anatara
Lifesciences Ltd for the year ended 30 June 2021, I declare that, to the best of my knowledge and belief, there have been:
a
b
no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
Grant Thornton Audit Pty Ltd
Chartered Accountants
T S Jackman
Partner – Audit & Assurance
Melbourne, 23 August 2021
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
29
Corporate Governance Statement
Anatara Lifesciences Ltd and the board are committed to achieving and demonstrating the highest standards
of corporate governance. Anatara Lifesciences Ltd has reviewed its corporate governance practices against
the Corporate Governance Principles and Recommendations (4th edition) published by the ASX Corporate
Governance Council.
The 2021 corporate governance statement is dated as at 30 June 2021 and reflects the corporate
governance practices in place throughout the 2021 financial year. The 2021 corporate governance statement
was approved by the board on 22 September 2021. A description of the group's current corporate
governance practices is set out in the group's corporate governance statement which can be viewed at
https://anataralifesciences.com/investors/corporate-governance/.
ANNUAL REPORT 2021
30
Financial Report – 30 June 2021
Financial statements
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 (direct method)
Notes to the financial statements
Directors' declaration
31
32
33
34
35
67
These financial statements are consolidated financial statements for the group consisting of Anatara
Lifesciences Ltd and its subsidiaries. A list of major subsidiaries is included in note 11.
The financial statements are presented in the Australian currency.
Anatara Lifesciences Ltd is a company limited by shares, incorporated and domiciled in Australia. Its
registered office and principal place of business is:
Level 3, 62 Lygon Street
Carlton South VIC 3053
The financial statements were authorised for issue by the directors on 23 August 2021. The directors have
the power to amend and reissue the financial statements.
ANATARA LIFESCIENCES
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
31
For the year ended 30 June 2021
Other income
General and administrative expenses
Research and development expenses
Notes
2(a)
2(b)
2(b)
Operating loss
Finance income
Finance expenses
Finance costs - net
Loss before income tax
Income tax expense
Loss for the year
2021
$
1,108,028
2020
$
789,211
(2,271,903)
(2,916,978)
(840,815)
(1,288,941)
(2,004,690)
(3,416,708)
9,116
(300)
8,816
52,064
-
52,064
(1,995,874)
(3,364,644)
3
-
-
(1,995,874)
(3,364,644)
Other comprehensive income
Items that may be reclassified to profit or loss:
Other comprehensive income for the year, net of tax
-
-
Total comprehensive loss for the year
(1,995,874)
(3,364,644)
Loss per share for loss attributable to the ordinary
equity holders of the company:
Basic and diluted loss per share
18
(3.18)
(6.77)
Cents
Cents
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction
with the accompanying notes.
ANNUAL REPORT 2021
32
Consolidated Statement of Financial Position
As at 30 June 2021
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Total non-current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Employee benefit obligations
Lease liabilities
Total current liabilities
Non-current liabilities
Employee benefit obligations
Lease liabilities
Total non-current liabilities
Total liabilities
Net assets
EQUITY
Share capital
Other reserves
Accumulated losses
Total equity
Notes
4(a)
4(b)
5(b)
4(c)
5(a)
5(b)
5(a)
5(b)
6(a)
6(b)
2021
$
2020
$
3,432,077
2,682,368
772,559
37,123
4,241,759
5,778
79,253
85,031
630,333
23,740
3,336,441
7,187
-
7,187
4,326,790
3,343,628
335,450
53,037
14,116
402,603
28,268
65,801
94,069
496,672
3,830,118
412,355
51,679
-
464,034
22,929
-
22,929
486,963
2,856,665
19,755,634
678,492
17,039,590
553,342
(16,604,008)
(14,736,267)
3,830,118
2,856,665
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
ANATARA LIFESCIENCES
33
Consolidated Statement of Changes in Equity
For the year ended 30 June 2021
Balance at 1 July 2019
Loss for the year
Total comprehensive loss for the year
Share based payment expense –
performance rights
Transactions with owners in their
capacity as owners:
Options issued/expensed
Options forfeited/lapsed
Attributable to owners of Anatara Lifesciences Ltd
Share
capital
Other
reserves
Accumulated
losses
Total
equity
Notes
$
$
$
$
16,941,392
499,070
(11,524,895)
5,915,567
-
-
98,198
-
-
-
6(b)
6(b)
-
-
-
207,544
(153,272)
54,272
(3,364,644)
(3,364,644)
(3,364,644)
(3,364,644)
-
-
153,272
153,272
98,198
207,544
-
207,544
Balance at 30 June 2020
17,039,590
553,342
(14,736,267)
2,856,665
Attributable to owners of Anatara Lifesciences Ltd
Share
capital
Other
reserves
Accumulated
losses
Total
equity
Notes
$
$
$
$
17,039,590
553,342
(14,736,267)
2,856,665
Balance at 1 July 2020
Loss for the year
Total comprehensive loss for the year
Transactions with owners in their
capacity as owners:
Issued capital
Less: Capital raising costs
Unmarketable parcel buy-back
Share based payment expense - options
6(b)
Share based payment expense –
performance rights
Performance rights exercised
-
-
3,070,005
(333,741)
(37,632)
-
-
17,412
-
-
-
-
-
219,853
50,842
(17,412)
Options forfeited/lapsed
6(b)
-
(128,133)
2,716,044
125,150
(1,995,874)
(1,995,874)
(1,995,874)
(1,995,874)
-
-
-
-
-
-
128,133
128,133
3,070,005
(333,741)
(37,632)
219,853
50,842
-
-
2,969,327
Balance at 30 June 2021
19,755,634
678,492
(16,604,008)
3,830,118
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
ANNUAL REPORT 2021
34
Consolidated Statement of Cash Flows
For the year ended 30 June 2021
2021
$
Notes
2020
$
Cash flows from operating activities
Payments to suppliers and employees (inclusive of GST)
(3,096,438)
(3,745,235)
Government grants and tax incentives
Interest received
985,549
924,960
13,412
95,376
Net cash (outflow) from operating activities
7(a)
(2,097,477)
(2,724,899)
Cash flows from investing activities
Payments for investment in term deposits
-
(1,500,000)
Payments for property, plant and equipment
Proceeds from sale of property, plant and equipment
Proceeds from withdrawal from term deposits
(3,979)
-
-
(4,076)
1,266
5,550,000
Net cash (outflow) inflow from investing activities
(3,979)
4,047,190
Cash flows from financing activities
Proceeds from issues of shares and other equity securities
Share issue transaction costs
Principal elements of finance lease payments
Net cash inflow from financing activities
6(a)
6(a)
3,032,373
(180,694)
(514)
2,851,165
-
-
-
-
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
749,709
2,682,368
1,322,291
1,360,077
Cash and cash equivalents at end of year
4(a)
3,432,077
2,682,368
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
ANATARA LIFESCIENCES
Notes to the Financial Statements
Contents to the Notes to the Financial Statements
1
2
3
4
5
6
7
8
9
Segment information
Other income and expense items
Income tax expense
Financial assets and financial liabilities
Non-financial assets and liabilities
Equity
Cash flow information
Critical estimates, judgements and errors
Financial risk management
10
Capital management
11
12
13
14
15
16
17
18
19
Interests in other entities
Contingent liabilities
COVID-19 impact on business
Events occurring after the reporting period
Related party transactions
Share-based payments
Remuneration of auditors
Loss per share
Parent entity financial information
20
Summary of significant accounting policies
35
36
36
38
39
41
43
46
47
47
50
50
50
51
51
51
52
54
55
56
57
ANNUAL REPORT 2021
36
Notes to the Financial Statements
1
Segment information
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 Chief Executive Officer of Anatara
Lifesciences Ltd. The group has identified one reportable segment; that is, the research, development of oral
solutions for gastrointestinal diseases and the commercialisation of the Detach® diarrhea treatment for piglets.
The segment details are therefore fully reflected in the body of the financial statements.
2
Other income and expense items
(a)
Other income
Research and development tax incentive
EMDG
COVID-19 government assistance
(i)
Fair value of R&D tax incentive
2021
$
1,023,028
47,500
37,500
1,108,028
2020
$
659,812
27,634
101,765
789,211
The group's research and development (R&D) activities are eligible under an Australian government tax
incentive for eligible expenditure. Management has assessed these activities and expenditure to determine
which are likely to be eligible under the incentive scheme. Amounts are recognised when it has been
established that the conditions of the tax incentive have been met and that the expected amount can be
reliably measured. For the year ended 30 June 2021, the group has included an item in other income of
$747,946 (2020: $612,967) to recognise income over the year necessary to match the R&D tax incentive on
a systematic basis with the costs that they are intended to compensate. Furthermore, the group subsequently
received additional $275,082 in current financial year as part of the R&D claim for financial year ended 30
June 2020 (2020: an additional refund of $46,845 in the financial year 2020 was received as part of the R&D
claim for financial year ended 30 June 2019).
(ii)
Fair value of EMDG and COVID-19 government assistance
The group's other grant income is recognised when compliance with the conditions attached to the grant have
been determined and the group has ascertained the grant will be received. For the year ended 30 June 2021,
the group has included an item in other income of $85,000 (2020: $129,399) to recognise income over the
year necessary to match the grant on a systematic basis with the costs that they are intended to compensate.
The Group recognised $47,500 Export Market Development Grant (EMDG) (2020: $27,634) in other income.
This is a key Australian Government financial assistance program for aspiring current exporters.
COVID-19 government assistance $37,500 (2020: $101,765) is included in other income. This is mainly
"Cashflow boost for employers" measure announced as part of the Australian Government's economic stimulus
package. In prior year, the government assistance included an additional of $39,265 payroll tax waived credit.
This is the coronavirus payroll tax relief provided by various State Revenue Office for the 2019-20 financial year.
ANATARA LIFESCIENCES
37
2
Other income and expense items (continued)
(b)
Breakdown of expenses by nature
2021
2020
Notes
$
$
General and administrative expenses
Accounting and audit
Consulting
Depreciation
Employee benefits
Insurance
Investor relations
Legal
Listing and share registry
Occupancy
Share-based payments
Superannuation
Travel and entertainment
Other
Research and development expenses
Project research and development
Corporate and finance
16(b)
155,708
148,094
218,665
6,265
335,713
16,098
1,234,470
1,452,317
58,794
33,389
34,206
103,929
53,496
117,648
110,378
4,498
140,457
57,312
120,188
33,821
68,686
93,767
305,744
138,897
32,508
113,833
2,271,903
2,916,978
807,265
1,240,834
33,550
48,107
840,815
1,288,941
ANNUAL REPORT 2021
38
3
Income tax expense
(a)
Numerical reconciliation of income tax expense to prima facie tax payable
Loss from continuing operations before income tax expense
(1,995,874)
(3,364,644)
Tax at the Australian tax rate of 26.0% (2020: 27.5%)
(518,927)
(925,277)
2021
2020
Notes
$
$
Tax effect of amounts which are not deductible (taxable) in
calculating taxable income:
R&D tax incentive
Accounting expenditure subject to R&D tax incentive
Blackhole expenditure (Section 40-880, ITAA 1997)
Share-based payments
Other items
Subtotal
Tax losses and other timing differences for which no deferred
tax asset is recognised
Income tax expense
(b)
Tax losses
(265,987)
(181,448)
611,465
417,122
-
(32,222)
30,588
84,080
(64,754)
3,759
(207,615)
(633,986)
207,615
633,986
-
-
2021
2020
$
$
Unused tax losses for which no deferred tax asset has been recognised
9,348,360
8,549,841
Potential tax benefit @ 26.0% (2020: 27.5%)
2,430,574
2,351,206
The numerical reconciliation of income tax expense to prima facie tax payable and unused tax losses for the
year ended 30 June 2020 have been represented to reflect the income tax return lodged for the same year.
ANATARA LIFESCIENCES
4
Financial assets and financial liabilities
(a)
Cash and cash equivalents
Current assets
Cash at bank and in hand
39
2021
2020
$
$
3,432,077
2,682,368
(i)
Reconciliation to cash flow statement
The above figures reconcile to the amount of cash shown in the consolidated statement of cash flows at
the end of the financial year as follows:
Balances as above
Balances per consolidated statement of cash flows
(ii)
Classification as cash equivalents
2021
2020
$
$
3,432,077
2,682,368
3,432,077
2,682,368
Term deposits are presented as cash equivalents if they have a maturity of three months or less from the
date of acquisition and are repayable with 24 hours notice with no loss of interest. See note 20(i) for the
group’s other accounting policies on cash and cash equivalents.
(iii)
Risk exposure
The group's exposure to interest rate risk is discussed in note 9. The maximum exposure to credit risk at the
end of the reporting period is the carrying amount of each class of cash and cash equivalents mentioned above.
(b)
Trade and other receivables
2021
Current
$
748,516
24,043
772,559
Non-
Current
$
-
-
-
Total
Current
$
$
748,516
630,333
24,043
-
772,559
630,333
Non-
Current
$
-
-
-
2020
Total
$
630,333
-
630,333
Accrued receivables (i)
Other receivables
ANNUAL REPORT 2021
40
4
Financial assets and financial liabilities (continued)
(b)
Trade and other receivables (continued)
(i)
Accrued receivables
Accrued receivables include $747,946 from the Australian Taxation Office in relation to the R&D tax incentive
(2020: $612,967). In prior year, accrued receivables also included $12,500 cash boost in relation to the
COVID-19 relief.
(ii)
Fair value of trade and other receivables
Due to the short-term nature of the current receivables, their carrying amount is considered to be the same
as their fair value.
(c)
Trade and other payables
Current
Non-
Current
$
195,629
103,150
36,671
335,450
$
-
-
-
-
2021
Total
Current
$
$
195,629
33,861
103,150
351,875
36,671
26,619
335,450
412,355
Non-
Current
$
-
-
-
-
2020
Total
$
33,861
351,875
26,619
412,355
Trade payables
Accrued expenses
Other payables
Trade payables are unsecured and are usually paid within 30 days of recognition.
The carrying amounts of trade and other payables are considered to be the same as their fair values, due to
their short-term nature.
ANATARA LIFESCIENCES
5
Non-financial assets and liabilities
(a)
Employee benefit obligations
2021
Current
Non-
Current
Total
Current
Non-
Current
$
$
$
$
$
41
2020
Total
$
Leave obligations (i)
53,037
28,268
81,305
51,679
22,929
74,608
(i)
Leave obligations
The leave obligations cover the group’s liabilities for long service leave and annual leave which are classified
as either other long-term benefits or short-term benefits, as explained in note 20(m).
The current portion of this liability includes all of the accrued annual leave, the unconditional entitlements to
long service leave where employees have completed the required year of service and also for those employees
that are entitled to pro-rata payments in certain circumstances. The entire amount of the provision of $53,037
(2020: $51,679) is presented as current, since the group does not have an unconditional right to defer
settlement for any of these obligations. However, based on past experience, the group does not expect all
employees to take the full amount of accrued leave or require payment within the next 12 months.
(b)
(i)
Leases
Amounts recognised in the balance sheet
The balance sheet shows the following amounts relating to leases:
Right-of-use assets
Property
Cost or fair value
Accumulated depreciation
Lease liabilities
Current
Non-current
2021
2020
$
80,131
(878)
79,253
14,116
65,801
79,917
$
-
-
-
-
-
-
ANNUAL REPORT 2021
42
5
Non-financial assets and liabilities (continued)
(b)
Leases (continued)
(ii)
Amounts recognised in the consolidated statement of profit or loss
The consolidated statement of profit or loss shows the following amounts relating to leases:
Depreciation charge of right-of-use assets
Properties
Interest expense (included in finance cost)
2021
2020
$
878
878
300
$
-
-
-
Expense relating to short-term leases (included in occupancy expenses)
53,496
93,767
Cash paid for principal payments
514
-
(iii)
The group’s leasing activities and how these are accounted for
In June 2021 the group entered into a two-year commercial lease in North Melbourne. The lease is for the
use of office facilities. This lease includes an extension option for a further 2 years.
Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased
asset is available for use by the group. Each lease payment is allocated between the liability and finance cost.
The finance cost is charged to profit or loss over the lease year so as to produce a constant periodic rate of
interest on the remaining balance of the liability for each year. The right-of-use asset is depreciated over the
shorter of the asset's useful life and the lease term on a straight-line basis.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include
the net present value of the following lease payments:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
fixed payments (including in-substance fixed payments), less any lease incentives receivable
variable lease payment that are based on an index or a rate
amounts expected to be payable by the lessee under residual value guarantees
the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that
option.
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be determined,
or the group’s incremental borrowing rate.
ANATARA LIFESCIENCES
43
5
Non-financial assets and liabilities (continued)
(b)
Leases (continued)
(iii)
The group’s leasing activities and how these are accounted for
Right-of-use assets are measured at cost comprising the following:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
the amount of the initial measurement of lease liability
any lease payments made at or before the commencement date, less any lease incentives received
any initial direct costs, and
restoration costs.
Payments associated with short-term leases are recognised on a straight-line basis as an expense in profit or
loss. Short-term leases are leases with a lease term of 12 months or less.
6
Equity
(a)
Share capital
Ordinary shares
Fully paid
2021
2020
2021
2020
Shares
Shares
$
$
70,238,523 49,856,177
19,755,634 17,039,590
70,238,523 49,856,177
19,755,634 17,039,590
ANNUAL REPORT 2021
44
6
Equity (continued)
(a)
Share capital (continued)
(i)
Movements in ordinary shares:
Below is the movement in ordinary shares in the year ended 30 June 2021 (2020: nil):
Details
Balance at 1 July 2019
Exercise of performance rights at $0.227 (2019-10-31)
Exercise of performance rights at $0.205 (2019-11-22)
Exercise of performance rights at $0.227 (2019-12-10)
Exercise of performance rights at $0.227 (2020-01-15)
Number of
shares
Total
$
49,413,236
16,941,392
149,457
106,810
82,599
104,075
33,927
21,896
18,750
23,625
Balance 30 June 2020
49,856,177
17,039,590
Shares issued
20,466,667
3,070,005
Unmarketable parcel buy-back facility payment (2021-02-10)
(211,413)
(37,632)
Exercise of performance rights with nil cash consideration (2020-09-15)
Exercise of performance rights with nil cash consideration (2020-10-28)
Less: Transaction costs arising on share issues
72,363
54,729
7,498
9,914
-
(333,741)
Balance 30 June 2021
70,238,523
19,755,634
(ii)
Ordinary shares
Ordinary shares entitle the holder to participate in dividends, and to share in the proceeds of winding up the
company in proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled
to one vote, and upon a poll each share is entitled to one vote.
Ordinary shares have no par value and the company does not have a limited amount of authorised capital.
(iii)
Options and performance rights
Information relating to options and performance rights, including details of those issued, exercised and
lapsed during the financial year and the outstanding balance as at the end of the reporting year is set out in
note 6(b).
ANATARA LIFESCIENCES
45
6
Equity (continued)
(b)
Other reserves
The consolidated statement of financial position line item ‘other reserves’ comprises the 'share-based
payments reserve'.
(i)
Nature and purpose of other reserves
Share-based payments
The share-based payment reserve records items recognised as expenses on valuation of share options and
performance rights issued to key management personnel, other employees and eligible contractors.
(ii)
Movement in options and performance rights
Details
Opening balance
Number of
options
2,571,000
Issue of unlisted option at $0.2305 on 22 June 2020
761,912
Share-based payment expenses of previously issued options
-
Options cancelled during the year
(412,500)
Share-based payments expenses of performance bonus
-
Balance at 30 June 2020
Options issued during the year
Options forfeited/lapsed during the year
2,920,412
2,117,704
(1,312,500)
Adjust issuance of unlisted option at $0.2305 on 22 June 2020
(761,912)
Share-based payment expenses of previously issued options
Issue of performance rights (2020-08-11)
Performance rights exercised during the year
Share-based payments expenses of performance bonus
-
-
-
-
Number of
performance
rights
-
-
-
-
-
-
-
-
-
-
Total
$
499,070
4,608
81,646
(156,390)
124,408
553,342
199,807
(127,875)
(258)
20,046
908,077
-
(127,092)
(17,412)
-
50,842
Balance at 30 June 2021
2,963,704
780,985
678,492
ANNUAL REPORT 2021
46
7
(a)
Cash flow information
Reconciliation of profit/(loss) after income tax to net cash inflow from operating activities
Loss for the year
Adjustments for
2021
2020
Notes
$
$
(1,995,874)
(3,364,644)
Depreciation and amortisation
2(b)
Net (gain) loss on sale of non-current assets
Finance costs
Share-based payments
Change in operating assets and liabilities:
Movement in trade and other receivables
Movement in other operating assets
Movement in trade and other payables
Movement in other operating liabilities
6,265
-
300
16,098
(280)
-
16(b)
117,648
305,744
(142,226)
265,653
(13,383)
(76,905)
32,327
47,803
6,698
(27,600)
Net cash inflow (outflow) from operating activities
(2,097,477)
(2,724,899)
(b)
Non-cash investing and financing activities
Non-cash investing and financing activities disclosed in other notes are:
(cid:120)
options issued for no cash consideration - note 16.
ANATARA LIFESCIENCES
47
8
Critical estimates, judgements and errors
The preparation of financial statements requires the use of accounting estimates which, by definition, will
seldom equal the actual results. Management also needs to exercise judgement in applying the group’s
accounting policies.
This note provides an overview of the areas that involved a higher degree of judgement or complexity, and
of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be
wrong. Detailed information about each of these estimates and judgements is included in other notes
together with information about the basis of calculation for each affected line item in the financial
statements. In addition, this note also explains where there have been actual adjustments this year as a result
of an error and of changes to previous estimates.
(a)
Significant estimates and judgements
The areas involving significant estimates or judgements are:
(cid:120)
(cid:120)
Estimation of R&D tax incentive income accrual - note 2(a)(i)
Estimation of share-based payments - note 16
Estimates and judgements are continually evaluated. They are based on historical experience and other
factors, including expectations of future events that may have a financial impact on the entity and that are
believed to be reasonable under the circumstances.
9
Financial risk management
This note explains the group's exposure to financial risks and how these risks could affect the group’s future
financial performance.
The group’s risk management is predominantly controlled by the board. The board monitors the group's
financial risk management policies and exposures and approves substantial financial transactions. It also
reviews the effectiveness of internal controls relating to market risk, credit risk and liquidity risk.
(a)
Market risk
(i)
Foreign exchange risk
The majority of the company's operations are denominated in Australian dollars, with the few exceptions on
services acquired from overseas suppliers but at a marginally insignificant amount and frequency. Therefore,
management has concluded that market risk from foreign exchange fluctuation is not material.
ANNUAL REPORT 2021
48
9
(a)
(ii)
Financial risk management (continued)
Market risk (continued)
Cash flow and fair value interest rate risk
The group's main interest rate risk arises from cash and cash equivalents and other financial assets at
amortised cost (deposits at call) held, which expose the group to cash flow interest rate risk. During 2021
and 2020, the group's cash and cash equivalents and deposits at call at variable rates were denominated in
Australian dollars.
The group's exposure to interest rate risk at the end of the reporting year, expressed in Australian dollars, was
as follows:
2021
2020
$
$
Financial instruments with cash flow risk
Cash and cash equivalents
3,432,077
2,682,368
Sensitivity
Profit or loss is sensitive to higher/lower interest income from cash and cash equivalents as a result of
changes in interest rates.
Impact on loss
for the period
Impact on other
components of equity
Interest rates - change by 31 basis
points (2020: 25 basis points)*
* Holding all other variables constant
10,639
6,706
2020
2021
2020
2021
$
$
$
-
$
-
The use of 0.31 percent (2020: 0.25 percent) was determined based on analysis of the Reserve Bank of
Australia cash rate change, on an absolute value basis, at 30 June 2021 and the previous four balance dates.
The average cash rate at these balance dates was 0.93 percent (2020: 1.25 percent). The average change to
the cash rate between balance dates was 33.88 percent (2020: 24.69 percent). By multiplying these two
values, the interest rate risk was derived.
Loss is more sensitive to movements in interest rates in 2021 than 2020 due to increased cash and cash
equivalents and deposits at call as well as low interest rate. The group's exposure to other classes of financial
instruments with cash flow risk is not material.
ANATARA LIFESCIENCES
49
9
(b)
Financial risk management (continued)
Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by
counterparties of contract obligations that could lead to a financial loss to the group.
(i)
Risk management
The company manages credit risk and the losses which could arise from default by ensuring that financial
assets such as cash at bank and deposits at call are held with reputable organisations.
(ii)
Impairment of financial assets
While cash and cash equivalents and term deposits are subject to the impairment requirements of AASB 9,
the identified impairment loss was immaterial.
(c)
Liquidity risk
Liquidity risk arises from the possibility that the group might encounter difficulty in settling its debts or
otherwise meeting its obligations related to financial liabilities. The group manages this risk through the
following mechanisms:
(cid:120)
(cid:120)
preparing forward looking cash flow analyses in relation to its operating, investing and financing activities;
obtaining funding from a variety of sources;
(cid:120) maintaining a reputable credit profile;
(cid:120) managing credit risk related to financial assets;
(cid:120)
(cid:120)
investing cash and cash equivalents and deposits at call with major financial institutions; and
comparing the maturity profile of financial liabilities with the realisation profile of financial assets.
(i)
Maturities of financial liabilities
The tables below analyse the group's financial liabilities into relevant maturity groupings based on their
contractual maturities. The amounts disclosed in the table are the contractual undiscounted cash flows.
Contractual
maturities of
financial liabilities
Less than
6 months
6 – 12
months
Between
1 and 2
years
Between
2 and 5
years
Over 5
years
$
At 30 June 2021
Trade and other payables
335,450
Total
335,450
At 30 June 2020
Trade and other payables
412,355
Total
412,355
$
-
-
-
-
$
-
-
-
-
$
-
-
-
-
$
-
-
-
-
Total
contractual
cash flows
Carrying
amount
(assets)/
liabilities
$
$
335,450
335,450
335,450
335,450
412,355
412,355
412,355
412,355
ANNUAL REPORT 2021
50
10 Capital management
(a)
Risk management
The group's objectives when managing capital are to
(cid:120)
safeguard their ability to continue as a going concern, so that they can continue to provide returns
for shareholders and benefits for other stakeholders, and
(cid:120) maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the group may issue new shares or reduce its capital,
subject to the provisions of the group's constitution. The capital structure of the group consists of equity
attributed to equity holders of the group, comprising contributed equity, reserves and accumulated losses.
By monitoring undiscounted cash flow forecasts and actual cash flows provided to the board by the group's
management, the board monitors the need to raise additional equity from the equity markets.
As at 30 June 2021, the group held cash and equivalents of $3,432,077. The group has put in place measures
to reduce all non-critical expenditure. The group anticipates a delay, to the first half of the financial year
2022, for the commencement of its clinical trial in irritable bowel syndrome (IBS) for its Gastrointestinal
ReProgramming (GaRP) over-the-counter medicine. The anticipated delay clinical trial extends the group's
cash runway, and the group will review funding needs in the future.
(b)
Dividends
No dividends were declared or paid to members for the year ended 30 June 2021 (2020: nil). The group’s
franking account balance was nil at 30 June 2021 (2020: nil).
11
Interests in other entities
(a)
Subsidiaries
The group’s principal subsidiaries at 30 June 2021 are set out below. Unless otherwise stated, they have
share capital consisting solely of ordinary shares that are held directly by the group, and the proportion of
ownership interests held equals the voting rights held by the group. The country of incorporation or
registration is also their principal place of business.
Ownership interest held by the group
Name of entity
Place of business/
country of
incorporation
Sarantis Pty Ltd
Australia
2021
%
100
2020
%
100
12 Contingent liabilities
The group had no contingent liabilities at 30 June 2021 (2020: nil).
ANATARA LIFESCIENCES
51
13 COVID-19 impact on business
Anatara Lifesciences remains committed to its corporate strategy and focused on delivering on its anticipated
milestones during the year ahead. However, the Company is actively planning for disruptions that may lead
to delays in meeting some of these objectives.
The company received financial support from Federal Government incentives through Cashflow Boost and,
through payroll tax refunds and deferrals by state governments. Anatara recorded other income of $37,500
for these items. Anatara did not participate in JobKeeper and has not terminated any employees during this
period. Anatara employees have been able to continue laboratory-based activities and as a result have
advanced GaRP to being clinical trial ready. In addition, new bromelain-based formulations were developed
for challenge trials in piglets (in-feed) and in poultry.
14 Events occurring after the reporting period
On 26 July 2021, the company announced the transition of Dr David Brookes from Non-Executive Director to
Chairman. Ms Sue MacLeman will continue on the Board, transitioning from Chair to Non-Executive Director.
On 13 August 2021, the group has issued 449,781 ordinary shares to Mr Steven Lydeamore as a result of
exercise of his performance rights. Furthermore, the group has issued 336,113 performance rights with nil
exercise price and expiring on 23 August 2024 under the Executive Option Plan.
No other matter or circumstance has occurred subsequent to year end that has significantly affected, or may
significantly affect, the operations of the group, the results of those operations or the state of affairs of the
group or economic entity in subsequent financial years.
15 Related Party Transactions
(a)
Subsidiaries
Interests in subsidiaries are set out in note 11(a).
(b)
Key management personnel compensation
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
2021
2020
$
$
958,413
1,226,979
89,556
11,393
107,112
6,363
108,485
285,873
1,167,847
1,626,327
Detailed remuneration disclosures are provided in the remuneration report on pages 15 to 24.
(c)
Transactions with other related parties
The group did not have any transactions with other related parties during the current financial year (2020: nil).
ANNUAL REPORT 2021
52
16 Share-based payments
(a)
Executive option plan
The establishment of the 'executive option plan' (EOP) was approved by shareholders at the 2020 annual
general meeting. The plan is designed to provide long-term incentives for executives (including directors) to
deliver long-term shareholder returns. Participation in the plan is at the board's discretion and no individual
has a contractual right to participate in the plan or to receive any guaranteed benefits.
Set out below are summaries of options granted under the plan:
Average
exercise
price per
share option
$1.33
$0.25
$1.45
-
$0.23
$0.48
$0.48
2021
2020
Average
exercise
price per
share option
$1.41
$0.23
-
Number of
options
2,920,412
2,117,704
(1,312,500)
Number of
options
2,571,000
761,912
-
-
$1.58
(412,500)
(761,912)
2,963,704
2,963,704
-
$1.33
$1.34
-
2,920,412
1,946,500
As at 1 July
Granted during the year
Forfeited/lapsed during the year
Cancelled during the year
Adjusted during the year
As at 30 June
Vested and exercisable at 30 June
Share options outstanding at the end of the year have the following expiry date and exercise prices:
Number
Grant date
Vesting date
Expiry date Exercise price ($)
Options
Options
Options
Options
Options
Options
Options
Options
Options
210,000
2016-09-23
2019-09-23
2021-09-23
12,000
12,000
12,000
200,000
200,000
200,000
617,704
2017-11-28
2017-11-28
2017-11-28
2018-11-17
2022-11-17
2019-11-17
2022-11-17
2020-11-17
2022-11-17
2019-04-10
2019-02-18
2024-02-17
2019-04-10
2020-02-18
2024-02-17
2019-04-10
2021-02-18
2024-02-17
2020-06-22
2020-12-03
2022-12-03
1,500,000
2020-11-26
2020-11-26
2023-11-25
2,963,704
1.7000
2.2700
2.2700
2.2700
0.7360
0.7400
0.7400
0.2476
0.2500
Weighted average remaining contractual life of options
outstanding at end of period
2021
2020
2.08
1.67
ANATARA LIFESCIENCES
16 Share-based payments (continued)
(b)
Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions recognised during the year were as follows:
53
Performance rights issued under EOP1
Options issued under EOP2
Performance pay3
2021
2020
$
-
66,806
50,842
$
98,198
83,138
124,408
117,648
305,744
1.
2.
3.
In prior year, it was agreed that 50% of performance pay for key management personnel relating to the year ended 30 June 2019 would
be paid out in performance rights rather than cash. 336,131 performance rights were valued at $0.227 each and 106,810 performance
rights were valued at $0.205, total performance rights value was $98,198. $0.227 was the VWAP at the date the terms were agreed being
23 September 2019, and $0.205 was the VWAP at the date the terms were agreed being 11 November 2019.
In June 2020 the board resolved to issue options to key management personnel for salary and directors fee reduction in the year ended
30 June 2020 and 30 June 2021. These options were valued at $0.0737 each with a total value of $66,806 for the current financial year
(2020: $83,138). $0.0737 was the VWAP at the date the terms were proposed being 22 June 2020.
Options granted to directors were issued given the shareholders' approval at the AGM held on 26 November 2020.
It was agreed that performance pay for selected employees for the year ended 30 June 2021 would be paid in performance rights rather
than cash. These performance rights were valued at a total value of $45,203. Performance rights issued to employees are long-term
incentives under the Executive Option Plan (EOP).
ANNUAL REPORT 2021
54
17 Remuneration of Auditors
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)
Grant Thornton Audit Pty Ltd
(i)
Audit and other assurance services
(i)
Audit and other assurance services
Audit and review of financial statements
Total remuneration for audit and other assurance services
(ii)
Taxation services
Tax compliance services
Total remuneration for taxation services
Total auditor's remuneration
2021
2020
$
$
58,000
58,000
35,000
35,000
93,000
57,000
57,000
34,350
34,350
91,350
It is the group's policy to employ Grant Thornton Audit Pty Ltd on assignments additional to their statutory
audit duties where Grant Thornton Audit Pty Ltd's expertise and experience with the group are important.
These assignments are principally tax advice.
ANATARA LIFESCIENCES
18 Loss per share
(a)
Basic earnings per share
Basic loss per share
(b)
Diluted earnings per share
Diluted loss per share
(c)
Reconciliation of loss used in calculating loss per share
55
2020
Cents
(6.77)
2020
Cents
(6.77)
2021
Cents
(3.18)
2021
Cents
(3.18)
2021
Cents
2020
Cents
Basic and diluted loss per share
Loss attributable to the ordinary equity holders of the company used in
calculating loss per share:
From continuing operations
1,995,874
3,364,644
(d) Weighted average number of shares used as the denominator
2021
2020
Number
Number
Weighted average number of ordinary shares used as the denominator in
calculating basic and diluted loss per share
62,708,190
49,670,261
On the basis of the group's losses, the outstanding options as at 30 June 2021 are considered to be anti-
dilutive and therefore were excluded from the diluted weighted average number of ordinary shares
calculation.
ANNUAL REPORT 2021
56
19
Parent entity financial information
(a)
Summary financial information
The individual financial statements for the parent resemble the consolidated financial statements as the
company's subsidiary, Sarantis Pty Ltd is a dormant entity.
(b)
Guarantees entered into by the parent entity
The parent entity has not entered into any guarantees in relation to debts of its subsidiaries in the year ended
30 June 2021 (2020: nil).
(c)
Contingent liabilities of the parent entity
The parent entity did not have any contingent liabilities as at 30 June 2021 or 30 June 2020.
(d)
Contractual commitments for the acquisition of property, plant or equipment
The parent entity has not entered into any contractual commitments for the acquisition of property, plant or
equipment in the year ended 30 June 2021 (2020: nil).
(e)
Determining the parent entity financial information
The financial information for the parent entity has been prepared on the same basis as the consolidated
financial statements, except as set out below.
(i)
Investments in subsidiaries
Investments in subsidiaries are accounted for at cost in the financial statements of Anatara Lifesciences Ltd.
(ii)
Tax consolidation legislation
Anatara Lifesciences Ltd and its wholly-owned Australian controlled entities have implemented the tax
consolidation legislation.
The head entity, Anatara Lifesciences Ltd, and the controlled entities in the tax consolidated group account
for their own current and deferred tax amounts. These tax amounts are measured as if each entity in the tax
consolidated group continues to be a stand-alone taxpayer in its own right.
In addition to its own current and deferred tax amounts, Anatara Lifesciences Ltd also recognises the current
tax liabilities (or assets) and the deferred tax assets arising from unused tax losses and unused tax credits
assumed from controlled entities in the tax consolidated group.
The entities have also entered into a tax funding agreement under which the wholly-owned entities fully compensate
Anatara Lifesciences Ltd for any current tax payable assumed and are compensated by Anatara Lifesciences Ltd for
any current tax receivable and deferred tax assets relating to unused tax losses or unused tax credits that are
transferred to Anatara Lifesciences Ltd under the tax consolidation legislation. The funding amounts are determined
by reference to the amounts recognised in the wholly-owned entities’ financial statements.
The amounts receivable/payable under the tax funding agreement are due upon receipt of the funding advice from
the head entity, which is issued as soon as practicable after the end of each financial year. The head entity may also
require payment of interim funding amounts to assist with its obligations to pay tax instalments.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as
current amounts receivable from or payable to other entities in the group.
Any difference between the amounts assumed and amounts receivable or payable under the tax funding
agreement are recognised as a contribution to (or distribution from) wholly-owned tax consolidated entities.
ANATARA LIFESCIENCES
20 Summary of significant accounting policies
Contents of the summary of significant accounting policies
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(l)
Basis of preparation
Principles of consolidation
Segment reporting
Foreign currency translation
Government grants
Income tax
Leases
Impairment of non-financial assets
Cash and cash equivalents
Trade receivables
Financial assets
Trade and other payables
(m)
Employee benefits
(n)
Contributed equity
(o)
Dividends
(p)
(q)
(r)
Loss per share
Rounding of amounts
Goods and services tax (GST)
57
58
60
60
60
60
61
61
61
62
62
62
64
64
65
65
66
66
66
ANNUAL REPORT 2021
58
20 Summary of significant accounting policies (continued)
This note provides a list of the significant accounting policies adopted in the preparation of these
consolidated financial statements to the extent they have not already been disclosed in the other notes
above. These policies have been consistently applied to all the years presented, unless otherwise stated. The
financial statements are for the group consisting of Anatara Lifesciences Ltd and its subsidiaries.
(a)
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards and Interpretations issued by the Australian Accounting Standards Board and the Corporations Act
2001. Anatara Lifesciences Ltd is a for-profit entity for the purpose of preparing the financial statements.
(i)
Compliance with IFRS
The consolidated financial statements of the Anatara Lifesciences Ltd group also comply with International
Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).
(ii)
Historical cost convention
The financial statements have been prepared on a historical cost basis.
(iii)
Going concern
The financial statements have been prepared on the going concern basis, which contemplates continuity of
normal business activities and the realisation of assets and settlement of liabilities in the normal course
of business.
As disclosed in the financial statements, the group incurred a loss of $1,995,874 and had operating cash
outflows of $2,097,477 for the year ended 30 June 2021. As at 30 June 2021, the group's held cash and cash
equivalents of $3,432,077.
In the process of approving the group's internal forecast and business plan for upcoming financial years, the
board has considered the cash position of the group within the next 12 months from the date of this report.
The group’s internal forecast and business plan for the upcoming financial year does not include capital raising.
The directors are confident, if necessary, the company could raise additional capital to meet the group’s
contractual commitments and working capital requirements. Notwithstanding the uncertainty over either of
these events occurring, based on the above considerations the board has assessed the resources and
opportunities available to the group, and consequently believe that the group will be able to repay its debts
as and when they fall due and are of the opinion that the financial statements have been appropriately
prepared on a going concern basis.
In the event that these measures are unsuccessful, there would be a material uncertainty which may cast
significant doubt as to whether the consolidated entity will continue as a going concern and therefore
whether it will realise its assets and extinguish its liabilities in the normal course of business and at the
amounts stated in the financial report.
The financial report does not include any adjustments related to the amounts or classification of recorded
assets or liabilities that might be necessary if the consolidated entity does not continue as a going concern.
ANATARA LIFESCIENCES
20 Summary of significant accounting policies (continued)
59
(a)
Basis of preparation (continued)
(iii)
Going concern (continued)
COVID-19
The World Health Organisation declared the outbreak of a novel coronavirus (COVID-19) as a pandemic.
In 2021, the Group continued to receive financial support from Federal Government incentives through
Cashflow Boost and, through payroll tax refunds and deferrals by state governments. Anatara recorded other
income of $37,500 (2020: $101,765) for these items. Anatara did not participate in JobKeeper during the year.
Covid-19 had a significant impact on Anatara’s programme, most directly by delaying the manufacturing of
GaRP and the trial placebo.
However, Anatara employees have been able to continue laboratory-based activities and as a result have
advanced GaRP to being clinical trial ready. In addition, new bromelain-based formulations were developed
for challenge trials in piglets (in-feed) and in poultry.
Following successful completion of the poultry challenge trial testing “Efficacy of ANR-pf on the performance
of broilers subject to subclinical and necrotic enteritis challenges” and the piglet challenge trial “BONIFF-
SMEC: An in-field practical delivery mechanism for improved weaner piglet performance”, Anatara is actively
seeking commercial partners.
The spread of Covid-19 has resulted in significant uncertainty around the breadth and duration of business
disruptions. Anatara is unable to determine whether it will have a material impact to its operations. However,
at this stage the directors do not believe this will impact the going concern of the company.
(iv) New and amended standards adopted by the group
The group has adopted all of the new or amended Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been
early adopted.
Configuration or Customisation Costs in a Cloud Computing Arrangement (IAS 38 Intangible Assets)
During the financial year the International Financial Reporting Interpretations Committee IFRIC identified that
various approaches to customisation and configuration costs for cloud computing arrangements were
utilised by companies depending on internal policy. These policies varied from expensing all costs in full to
capitalisation of all costs in full, with most entities taking a more nuanced approach in their capitalisation
policy and differentiating between expenditure with different underlying fact patterns.
The Agenda Decision requires that management capitalise those elements of expenditure that meet the
definition of an “Intangible Asset” as defined by AASB 138 Intangible Assets and recognise any additional
amounts as an expense as the entity benefits from the expenditure - either by applying AASB 138 or applying
another accounting standard.
The impact of this decision has not had a material impact on the group's financial statements.
ANNUAL REPORT 2021
60
20 Summary of significant accounting policies (continued)
(b)
(i)
Principles of consolidation
Subsidiaries
Subsidiaries are all entities (including structured entities) over which the group has control. The group
controls an entity when the group 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 to direct the activities of the entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are
deconsolidated from the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the group.
Intercompany transactions, balances and unrealised gains on transactions between group companies are
eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment
of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure
consistency with the policies adopted by the group.
(c)
Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. This has been identified as the chief executive officer.
(d)
(i)
Foreign currency translation
Functional and presentation currency
Items included in the financial statements of each of the group's entities are measured using the currency
of the primary economic environment in which the entity operates ('the functional currency'). The
consolidated financial statements are presented in Australian dollar ($), which is Anatara Lifesciences Ltd's
functional and presentation currency.
(ii)
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the
dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at
year end exchange rates are generally recognised in profit or loss.
Foreign exchange gains and losses that relate to borrowings are presented in the consolidated income
statement, within finance costs. All other foreign exchange gains and losses are presented in the
consolidated income statement on a net basis within other gains/(losses).
(e)
Government grants
Transactions involving government grants received are accounted for by applying AASB 120 Government
Grants. Grants from the government are recognised at their fair value where there is a reasonable assurance
that the grant will be received and the group will comply with all attached conditions. Note 2 provides further
information on how the group accounts for government grants.
ANATARA LIFESCIENCES
61
20 Summary of significant accounting policies (continued)
(f)
Income tax
The income tax expense or credit for the year is the tax payable on the current year's taxable income based
on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at
the end of the reporting year in the countries where the company and its subsidiaries and associates operate
and generate taxable income. Management periodically evaluates positions taken in tax returns with respect
to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where
appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between
the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements.
However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill.
Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability in a
transaction other than a business combination that at the time of the transaction affects neither accounting
nor taxable profit or loss.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted
by the end of the reporting year and are expected to apply when the related deferred income tax asset is
realised or the deferred income tax liability is settled.
Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise
those temporary differences and losses.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised
in other comprehensive income or directly in equity. In this case, the tax is also recognised in other
comprehensive income or directly in equity, respectively.
(g)
Leases
The Group has adopted AASB 16 from 1 July 2019. With the exception of short-term, low value and immaterial
leases, right-of-use assets and corresponding lease liabilities are recognised in the consolidated statement
of financial position. Straight-line operating lease expense recognition is replaced with a depreciation charge
for the right-of-use assets (included in operating costs) and an interest expense on the recognised lease
liabilities (included in finance costs).
Payments associated with short-term leases, low value and immaterial leases are recognised on a straight-
line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less.
(h)
Impairment of non-financial assets
Intangible assets are tested for impairment whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the
asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's
fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped
at the lowest levels for which there are separately identifiable cash inflows which are largely independent of
the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other
than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of
each reporting year.
ANNUAL REPORT 2021
62
20 Summary of significant accounting policies (continued)
(i)
Cash and cash equivalents
For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents
includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid
investments with original maturities of three months or less that are readily convertible to known amounts
of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts
are shown within borrowings in current liabilities in the consolidated statement of financial position.
(j)
Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using
the effective interest method, less loss allowance. See note 4(b) for further information about the group’s
accounting for trade receivables and note 9(b) for a description of the group's impairment policies.
(k)
Financial assets
(i)
Classification
The group classifies its financial assets in the following measurement categories:
(cid:120)
(cid:120)
those to be measured subsequently at fair value (either through OCI or through profit or loss), and
those to be measured at amortised cost.
The classification depends on the entity’s business model for managing the financial assets and the
contractual terms of the cash flows.
For assets measured at fair value, gains and losses will either be recorded in profit or loss or OCI. For
investments in equity instruments that are not held for trading, this will depend on whether the group has
made an irrevocable election at the time of initial recognition to account for the equity investment at fair
value through other comprehensive income (FVOCI).
(ii)
Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date, the date on which the
group commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive
cash flows from the financial assets have expired or have been transferred and the group has transferred
substantially all the risks and rewards of ownership.
(iii) Measurement
At initial recognition, the group measures a financial asset at its fair value plus, in the case of a financial asset
not at fair value through profit or loss (FVPL), transaction costs that are directly attributable to the acquisition
of the financial asset. Transaction costs of financial assets carried at FVPL are expensed in profit or loss.
ANATARA LIFESCIENCES
20 Summary of significant accounting policies (continued)
63
(k)
Financial assets (continued)
(iii) Measurement (continued)
Debt instruments
Subsequent measurement of debt instruments depends on the group’s business model for managing the
asset and the cash flow characteristics of the asset. There are three measurement categories into which the
group classifies its debt instruments:
(cid:120)
(cid:120)
(cid:120)
Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows
represent solely payments of principal and interest are measured at amortised cost. Interest income
from these financial assets is included in finance income using the effective interest rate method.
Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in
other gains/(losses) together with foreign exchange gains and losses. Impairment losses are
presented as separate line item in the consolidated income statement.
FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial assets,
where the assets’ cash flows represent solely payments of principal and interest, are measured at
FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of
impairment gains or losses, interest income and foreign exchange gains and losses which are
recognised in profit or loss. When the financial asset is derecognised, the cumulative gain or loss
previously recognised in OCI is reclassified from equity to profit or loss and recognised in other
gains/(losses). Interest income from these financial assets is included in finance income using the
effective interest rate method. Foreign exchange gains and losses are presented in other
gains/(losses) and impairment expenses are presented as separate line item in the consolidated
income statement.
FVPL: Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain
or loss on a debt investment that is subsequently measured at FVPL is recognised in profit or loss
and presented net within other gains/(losses) in the year in which it arises.
(iv)
Impairment
The group assesses on a forward looking basis the expected credit losses associated with its debt instruments
carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has
been a significant increase in credit risk.
(v)
Income recognition Interest income
Interest income is recognised using the effective interest method. When a receivable is impaired, the group
reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at
the original effective interest rate of the instrument, and continues unwinding the discount as interest
income. Interest income on impaired loans is recognised using the original effective interest rate.
ANNUAL REPORT 2021
64
20 Summary of significant accounting policies (continued)
(l)
Trade and other payables
These amounts represent liabilities for goods and services provided to the group prior to the end of financial
year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade
and other payables are presented as current liabilities unless payment is not due within 12 months after the
reporting year. They are recognised initially at their fair value and subsequently measured at amortised cost
using the effective interest method.
(m)
Employee benefits
(i)
Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave
that are expected to be settled wholly within 12 months after the end of the year in which the employees
render the related service are recognised in respect of employees’ services up to the end of the reporting
year and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are
presented as current employee benefit obligations in the balance sheet.
(ii)
Other long-term employee benefit obligations
The group also has liabilities for long service leave and annual leave that are not expected to be settled wholly
within 12 months after the end of the year in which the employees render the related service. These
obligations are therefore measured as the present value of expected future payments to be made in respect
of services provided by employees up to the end of the reporting year using the projected unit credit method.
Consideration is given to expected future wage and salary levels, experience of employee departures and
years of service.
Expected future payments are discounted using market yields at the end of the reporting year of high-quality
corporate bonds with terms and currencies that match, as closely as possible, the estimated future cash
outflows. Remeasurements as a result of experience adjustments and changes in actuarial assumptions are
recognised in profit or loss.
The obligations are presented as current liabilities in the balance sheet if the entity does not have an
unconditional right to defer settlement for at least twelve months after the reporting year, regardless of when
the actual settlement is expected to occur.
ANATARA LIFESCIENCES
65
20 Summary of significant accounting policies (continued)
(m)
Employee benefits (continued)
(iii)
Share-based payments
Share-based compensation benefits are provided to employees via the 'employee option plan' (EOP).
Information relating to these schemes is set out in note 16.
Employee options
The fair value of options granted under the EOP is recognised as a share-based payment expense with a
corresponding increase in equity. The total amount to be expensed is determined by reference to the fair
value of the options granted:
(cid:120)
(cid:120)
(cid:120)
including any market performance conditions (e.g. the company’s share price)
excluding the impact of any service and non-market performance vesting conditions (e.g.
profitability, sales growth targets and remaining an employee of the company over a specified time
year), and
including the impact of any non-vesting conditions (e.g. the requirement for employees to save or
holdings shares for a specific year of time).
The total expense is recognised over the vesting year, which is the year over which all of the specified vesting
conditions are to be satisfied. At the end of each year, the entity revises its estimates of the number of options
that are expected to vest based on the non-market vesting and service conditions. It recognises the impact
of the revision to original estimates, if any, in profit or loss, with a corresponding adjustment to equity.
(n)
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.
(o)
Dividends
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at
the discretion of the entity, on or before the end of the reporting year but not distributed at the end of the
reporting year.
ANNUAL REPORT 2021
66
20 Summary of significant accounting policies (continued)
(p)
Loss per share
(i)
Basic loss per share
Basic loss per share is calculated by dividing:
(cid:120)
(cid:120)
the loss attributable to owners of the company, excluding any costs of servicing equity other than
ordinary shares
by the weighted average number of ordinary shares outstanding during the financial year, adjusted
for bonus elements in ordinary shares issued during the year.
(ii)
Diluted loss per share
Diluted loss per share adjusts the figures used in the determination of basic loss per share to take into
account:
(cid:120)
(cid:120)
the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares, and
the weighted average number of additional ordinary shares that would have been outstanding
assuming the conversion of all dilutive potential ordinary shares.
(q)
Rounding of amounts
The company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the 'rounding off' of
amounts in the financial statements. Amounts in the financial statements have been rounded off in
accordance with the instrument to the nearest dollar.
(r)
Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred
is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition
of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount
of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables
in the consolidated statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or
financing activities which are recoverable from, or payable to the taxation authority, are presented as
operating cash flows.
ANATARA LIFESCIENCES
67
Directors’ Declaration
In the directors' opinion:
(a)
the financial statements and notes set out on pages 30 to 66 are in accordance with the
Corporations Act 2001, including:
(i)
(ii)
complying with Accounting Standards, the Corporations Regulations 2001 and other
mandatory professional reporting requirements, and
giving a true and fair view of the consolidated entity's financial position as at 30 June
2021 and of its performance for the financial year ended on that date, and
(b)
there are reasonable grounds to believe that the company will be able to pay its debts as and
when they become due and payable.
Note 20(a) confirms that the financial statements also comply with International Financial Reporting
Standards as issued by the International Accounting Standards Board.
The directors have been given the declarations by the chief executive officer and chief financial officer
required by section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of directors.
Dr David Brookes
Non-Executive Chair
Melbourne
23 August 2021
ANNUAL REPORT 2021
Collins Square, Tower 5
727 Collins Street
Melbourne VIC 3008
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Independent Auditor’s Report
To the Members of Anatara Lifesciences Ltd
Report on the audit of the financial report
Opinion
We have audited the financial report of Anatara Lifesciences Ltd (the Company) and its subsidiaries (the Group), which
comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss
and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows
for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting
policies, and the Directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:
a giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its performance for the year
ended on that date; and
b complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are
further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are
independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and
the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial
report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Material uncertainty related to going concern
We draw attention to Note 20(a)(iii) in the financial statements, which indicates that the Group incurred a net loss of
$1,995,874 and had operating cash outflows of $2,097,477 during the year ended 30 June 2021. As at 30 June 2021 the
Group held cash and cash equivalents of $3,432,077. As stated in Note 20(a)(iii), these events or conditions, and other
matters as set forth in Note 20(a)(iii), indicate that a material uncertainty exists that may cast doubt on the Group’s ability to
continue as a going concern. Our opinion is not modified in respect of this matter.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
In addition to the matter described in the Material uncertainty related to going concern section, we have determined the
matters described below to be the key audit matters to be communicated in our report.
Key audit matter
How our audit addressed the key audit matter
Recognition of research and development tax incentive –
Notes 2(a)(i), 4(b)(i) and 8(a)
The Group receives a refundable tax offset of eligible
expenditure under the research and development (R&D) tax
incentive scheme. An R&D plan is filed with AusIndustry in the
following financial year and, based on this filing, the Group
receives the incentive in cash.
Management perform a detailed review of the Group’s total
research and development expenditure to determine the
potential claim under the R&D tax incentive legislation.
The Group recognises R&D tax incentive rebate income on an
accruals basis, meaning that a receivable is recorded at the
balance date based on the estimated amount that is yet to be
received from the Australian Taxation Office for the period 1
July 2020 to 30 June 2021.
This area is a key audit matter due to the degree of judgement
and interpretation of the R&D tax legislation required by
management to assess the eligibility of the R&D expenditure
under the scheme.
Our procedures included, amongst others:
(cid:120) Obtaining the R&D incentive calculations prepared by
management and engaging an internal R&D Tax Expert to
assist the engagement team in assessing the
reasonableness of the estimate;
(cid:120) Comparing the nature of the R&D expenditure included in
the current year estimate to the prior year approved claim;
(cid:120) Comparing the estimates made in previous years to the
amount of cash actually received after lodgement of the
R&D tax claim;
(cid:120) Considering the nature of the expenses against the
eligibility criteria of the R&D tax incentive scheme to form a
view about whether the expenses included in the estimate
are likely to meet the eligibility criteria;
(cid:120) Assessing the eligible expenditure used to calculate the
estimate to ensure it is in accordance with expenditure
recorded in the general ledger;
(cid:120) Agreeing a sample of individual expenditure items included
in the estimate to underlying supporting documentation to
ensure that they have been appropriately recognised in the
accounting records and that they are eligible expenditures;
(cid:120) Inspecting copies of relevant correspondence with
AusIndustry and the ATO related to the claims; and
(cid:120) Reviewing the appropriateness of the relevant disclosures
in the financial statements.
Information other than the financial report and auditor’s report thereon
The Directors are responsible for the other information. The other information comprises the information included in the
Group’s annual report for the year ended 30 June 2021, but does not include the financial report and our auditor’s report
thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the financial report
The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in
accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors
determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the Group’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the
Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.Auditor’s
responsibilities for the audit of the financial report
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing
Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance
Standards Board website at: https://www.auasb.gov.au/auditors_responsibilites/ar1_2020.pdf. This description forms part of
our auditor’s report.
Report on the remuneration report
Opinion on the remuneration report
We have audited the Remuneration Report included in pages 15 to 24 of the Directors’ report for the year ended 30 June
2021.
In our opinion, the Remuneration Report of Anatara Lifesciences Ltd, for the year ended 30 June 2021 complies with
section 300A of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance
with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report,
based on our audit conducted in accordance with Australian Auditing Standards.
Grant Thornton Audit Pty Ltd
Chartered Accountants
T S Jackman
Partner – Audit & Assurance
Melbourne, 23 August 2021
71
Shareholder Information
The shareholder information set out below was applicable as at 15 September 2021.
A. Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
Number of holders (shares)
Ordinary shares
Holding
1 - 1000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
38
178
163
368
113
860
12,324
689,921
1,286,753
12,618,726
56,411,784
71,019,508
There were 83 holders of less than a marketable parcel of ordinary shares.
ANNUAL REPORT 2021
72
B. Equity security holders
Twenty largest quoted equity security holders
The names of the twenty largest holders of quoted equity securities are listed below:
Number of
ordinary
shares held
Percentage
of issued
shares
Name
UBS NOMINEES PTY LTD
RTL GROUP INVESTMENTS PTY LTD
PARMA CORPORATION
MYENG PTY LTD
SCINTILLA STRATEGIC INVESTMENTS LIMITED
IAIN ROSS
6,371,106
5,400,000
4,683,965
3,580,211
3,498,474
1,500,000
SLADE TECHNOLOGIES PTY LTD
1,500,000
MR BRENDAN PHYLAND
MR CRAIG GRAEME CHAPMAN
MR MICHAEL ANDREW WHITING & MRS TRACEY ANNE WHITING
MR STEVEN GEORGE LYDEAMORE
BEEBEE HOLDINGS PTY LTD
VAMOS TRADING PTY LTD
DAVID CHARLES VENABLES
NAVIGATOR AUSTRALIA LTD
DR MARK DANIEL REEVES
GP SECURITIES PTY LTD
MR BRIAN JAMES WOODLEY
GENETIC HORIZONS PTY LTD
JACOBY MANAGEMENT SERVICES
1,284,000
1,000,000
898,712
849,238
814,218
800,000
719,750
631,327
520,614
500,000
500,000
486,109
485,731
8.97
7.60
6.60
5.04
4.93
2.11
2.11
1.81
1.41
1.27
1.20
1.15
1.13
1.01
0.89
0.73
0.70
0.70
0.68
0.68
36,023,455
50.72
Number on
issue
Number of
holders
2,963,704
336,113
8
2
Unquoted equity securities
Name
Options over ordinary shares issued
Performance rights over ordinary shares issued
ANATARA LIFESCIENCES
73
C. Voting rights
The voting rights attaching to each class of equity securities are set out below:
(a)
(b)
(c)
Ordinary shares: On a show of hands every member present at a meeting in person or by proxy
shall have one vote and upon a poll each share shall have one vote.
Options: No voting rights.
Performance rights: No voting rights.
There are no other classes of equity securities.
ANNUAL REPORT 2021
74
ANATARA LIFESCIENCES