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Annual Report 2018
Contents to Annual Report PageOperations Report 1Intellectual Property Report 5Directors' Report 9Auditor Independence Declaration 21Corporate Governance Statement 22Consolidated Statement of Profit or Loss and Other Comprehensive Income 29Consolidated Statement of Financial Position 30Consolidated Statement of Changes in Equity 31Consolidated Statement of Cash Flows 32Notes to the Financial Statements 33Directors' Declaration 55Independent Auditor's Report 56Shareholder Information 60Corporate Information 62 ?
What is Multiple Sclerosis?
Multiple Sclerosis (MS) is a life-long, chronic disease
that progressively destroys the central nervous system
(CNS). It affects approximately 400,000 people in North
America and more than 1 million worldwide and the
current market for MS drugs is estimated at more than
USD$12 billion. It is a disease that affects more women
than men, with onset typically occurring between 20
and 40 years of age. Symptoms of MS may include
vision problems, loss of balance, numbness, difficulty
walking and paralysis. In Australia MS affects over
15,000 people and worldwide MS may affect more than
one million people.
1
ANNUAL REPORT 2018 Operations ReportOverview of Company’s Activities Antisense Therapeutics Limited (“the Company” or “Antisense Therapeutics”) continued its focus on advancing its antisense oligonucleotide products under development. The following report on operations details the research and development activities undertaken by the Company in the period.Capital RaisingOn the 3rd April 2018 the Company announced that it had received strong financial support from a number of leading healthcare institutional investors to undertake a capital raising that was conducted via a placement to Australian Ethical Investment followed by an Entitlement Issue to all shareholders.Australian Ethical Investment and Platinum Asset Management became the largest shareholders in the Company with 19.31% and 5.97% respectively.Pursuant to the capital raising, the Company successfully raised the target amount of $5.0 millionATL1102 for Multiple Sclerosis (MS)ATL1102 is a second generation antisense inhibitor of CD49d, the alpha subunit of VLA-4 (Very Late Antigen-4). In inflammation, white blood cells (leukocytes) move out of the bloodstream into the inflamed tissue, for example, the Central Nervous System (CNS) in MS, and the lung airways in asthma. In MS, the inhibition of VLA-4 prevents white blood cells from entering the CNS, thereby reducing the severity of the disease and slowing its progression. VLA-4 is a clinically validated target in the treatment of MS. Antisense inhibition of VLA-4 has demonstrated positive effects in a number of animal models of inflammatory disease including MS. ATL1102 was shown to be highly effective in reducing MS lesions in a 77 patient double-blind placebo controlled Phase IIa clinical trial in MS patients. The Phase IIa clinical trial data on ATL1102 has been published in the medical Journal Neurology (Limmroth et al, Neurology, 2014 Nov 11: 83(20: 1780-8).The Company reported that it had submitted an Investigational New Drug (IND) application to the FDA for the conduct of a Phase IIb trial in MS patients.Phase IIb TrialThe FDA advised the Company that modifications to the proposed clinical trial were needed in order for FDA to clear the IND to proceed. The Company reported that it had submitted a formal response to the US FDA in regard to the ATL1102 for MS Phase IIb IND application to address the points specified by the FDA in their clinical hold letter. Subsequently the Company announced that it had received notification from the FDA that the full clinical hold for the Phase IIb clinical study of ATL1102 for MS had been lifted and that the study may proceed at a lower (25mg/week) dose for 6 months under a partial hold introduced by the FDA.The Company is exploring the conditions that would allow MS patients to receive higher doses including potentially generating additional data while monitoring the progress of the ATL1102 DMD trial which could provide support for undertaking studies in MS patients at the FDA approved dose.New DataDuring the period the Company reported that data showing ATL1102 significantly reduces the number of active multiple sclerosis (MS) brain lesions that convert to 'Black Holes' [areas of axonal (nerve fibre) loss or permanent tissue damage] was presented at the 7th Joint ECTRIMS-ACTIMS Meeting in Paris, France. ?
What is Duchennes Muscular
Dystrophy?
Duchenne Muscular Dystrophy (DMD) is an X-linked
disease that affects 1 in 3600 to 6000 live male
births (Bushby et al, 2010). DMD occurs as a result
of mutations in the dystrophin gene which causes
a defect in the protein or reduction or absence of
the dystrophin protein. Children with DMD have
dystrophin deficient muscles and are susceptible to
contraction induced injury to muscle which triggers
the immune system which exacerbates muscle
damage (Pinto Mariz, 2015). Ongoing deterioration
in muscle strength affects lower limbs leading to
impaired mobility, and also affects upper limbs,
leading to further loss of function and self-care
ability. The need for wheelchair use can occur
in early teenage years, with respiratory, cardiac,
cognitive dysfunction also emerging. With no
intervention, the mean age of life is approximately
19 years. The management of the inflammation
associated with DMD is currently via the use of
corticosteroids, which have insufficient efficacy and
significant side effects.
2
2018 ANNUAL REPORT ATL1102 for Duchennes Muscular Dystrophy (DMD)The Company is undertaking a clinical trial of ATL1102 in patients with Duchenne Muscular Dystrophy (DMD). DMD is caused by a mutation in the muscle dystrophin gene leading to severe progressive muscle loss and premature death. One of the most common fatal genetic disorders, DMD affects approximately one in every 3,500 to 5,000 males worldwide. A key challenge in the management of DMD patients is to reduce the inflammation that exacerbates the muscle fibre damage. Corticosteriods are the only approved treatments for muscle inflammation, however they do not sufficiently suppress the muscle inflammation, are not well tolerated and have serious side effects including adversely affecting growth rate. As a consequence, there is an acknowledged high need for new therapeutic approaches for the treatment of inflammation associated with DMD.The clinical trial of ATL1102 in patients with DMD is designed to assess the drug's effects on the inflammation associated with the muscle fibre damage characteristic of this disease. The clinical trial is being conducted at the Royal Children's Hospital (RCH) in Melbourne, with the clinical development of ATL1102 in DMD to be directed by an Advisory Board of international experts in the field.ProgressOn 28th February 2018 the Company advised that it had received approval from the RCH's Human Research Ethical Committee, to undertake the ATL1102 Phase II clinical trial. The study is a single dose investigation of 25mg of ATL1102 administered weekly in wheel chair bound boys with DMD. The primary goal of the study is to establish ATL1102's safety and tolerability in this DMD patient population at the dose being investigated. The potential efficacy of ATL1102 will also be assessed via ATL1102's effects on important blood and imaging (MRI) markers of inflammation and muscle damage associated with DMD. Notably, the extended (6 month) dosing period of this clinical trial may also allow for ATL1102 to show an improvement in key clinical endpoints that are relevant to DMD disease progression (e.g. the upper limb function of the boys) and that are of the type that would be required for future product registration.The Clinical Investigators for the trial are Dr Ian Woodcock, a Neuromuscular Fellow at the RCH and Professor Monique Ryan, Director of the Neurology Department at RCH.Events After The Balance Sheet DateOn 16th July 2018 Antisense Therapeutics advised that an initiation meeting with trial investigators, coordinators, clinical project managers, nurses and other key personnel involved in the study was held at the trial site at the RCH and patient recruitment was to proceed. Subsequently, the first patient into the trial has been dosed with ATL1102.On the 23rd July 2018 the Company announced the appointment of Ms Nuket Desem as Director of Clinical and Regulatory affairs. Nuket brings to Antisense Therapeutics over 20 years' experience in global regulatory affairs, clinical development and project management obtained through her roles with the pharmaceutical/biotechnology industry, including senior positions in various biotechnology companies. Nuket will be responsible for developing the Company's global clinical and regulatory strategy for its product pipeline and for execution of the Company's clinical development plans, including the conduct of the Phase II clinical trial of ATL1102 in Duchenne Muscular Dystrophy at the Royal Children's Hospital in Melbourne.Operations Report continued ?
What is Acromegaly?
Acromegaly is a serious chronic life threatening disease
triggered by excess secretion of growth hormone
(GH) by benign pituitary tumours. Oversupply of GH
over stimulates liver, fat and kidney cells, through
their GH receptors, to produce excess levels of Insulin-
Like Growth Factor-I (IGF-I) in the blood manifesting
in abnormal growth of the face, hands and feet, and
enlargement of body organs including liver, kidney
and heart. The primary treatments for acromegaly
are to surgically remove the pituitary gland and/or
drug therapy to normalize GH and serum IGF-I levels.
In North America and Europe there are approximately
85,000 diagnosed acromegaly patients with about half
requiring drug therapy.
3
ANNUAL REPORT 2018 ATL1103 for AcromegalyATL1103 also referred to as atesidorsen is an antisense drug designed to block growth hormone receptor (GHr) expression thereby reducing levels of the hormone insulin–like growth factor–I (IGF–I) in the blood and is a potential treatment for diseases associated with excessive growth hormone action. By inhibiting GHr production, ATL1103 in turn reduces IGF–I levels in the blood (serum). There are a number of diseases that are associated with excess GH and IGF–I action. These diseases include acromegaly, an abnormal growth disorder of organs, face, hands and feet; diabetic retinopathy, a common disease of the eye and a major cause of blindness; diabetic nephropathy, a common disease of the kidney and major cause of kidney failure, and certain forms of cancer.ATL1103 is in clinical development as a treatment for acromegaly. Normalizing serum IGF–I levels is the therapeutic goal in the treatment of acromegaly and reducing the effects of IGF–I has a potential role in the treatment of diabetic retinopathy, nephropathy and certain forms of cancer. The Company conducted a successful Phase II trial of ATL1103 with the trial having met its primary efficacy endpoint by showing a statistically significant average reduction in sIGF-1 levels. The Company also conducted a high dose study of ATL1103 in adult patients with acromegaly in Australia.The US Food and Drug Administration (FDA) and European Commission have granted Orphan Drug designation to ATL1103 for treatment of Acromegaly.The Company executed a global agreement with innovative early access provider myTomorrows (Amsterdam, The Netherlands) to implement an Early Access Program (EAP) for ATL1103, for treatment of acromegaly and is to initially be established in selected countries within the European Union (EU).ProgressOn 26th February 2018 the Company announced that it had executed an agreement with a GMP manufacturing facility in the US to undertake the formulation of ATL1103 raw material into injectable product for the potential treatment of acromegaly patients under an EAP.On 23rd May 2018 the Company announced the publication of previously reported positive Phase II clinical trial data on ATL1103 (atesidorsen) in the leading peer-reviewed medical Journal, the European Journal of Endocrinology. (Trainer et al, Eur J Endocrinol, 2018 May 22-179:97-108)The article highlights the successful outcomes of the Phase II clinical trial of ATL1103 in acromegaly patients where the safety, tolerability, pharmacokinetics and efficacy of two subcutaneous dosing regimens of ATL1103 in 26 adult acromegaly patients dosed with ATL1103 for 13 weeks were assessed. ATL1103 met its primary endpoint in the study resulting in a median fall in serum insulin-like growth factor-I (sIGF-I) of 27.8% (p=0.0002) at the twice weekly 200mg dose tested.The authors of the publication include the clinical investigators from the Phase II study who are prominent endocrinologists from centres in the UK, France, Spain and Australia. The Principal Investigator of the ATL1103 Phase II study, Dr Peter Trainer, Professor of Endocrinology, The Christie NHS Foundation Trust, UK, is the lead author of the publication.On 14th June 2018 the Company reported that the formulation of ATL1103 raw material into injectable product work had recently been completed with the newly formulated injectable product (Drug Product or DP) to undergo release testing for human use. The DP is then to be appropriately labelled and packaged for supply to patients under the EAP.In parallel, the Company with its partner, myTomorrows advised that they were progressing work on the documentation required for the regulatory approvals to supply ATL1103 product under the EAP. 4
2018 ANNUAL REPORT R&D Tax IncentiveDuring the year the Company received from the ATO a payment of $399,374 in relation to R&D expenditure incurred in the previous financial year.Financial PositionAt 30 June 2018, the Company had cash reserves (including Term Deposits of greater than three months) of $4,299,059 (2017: $1,901,988).Events After The Balance Sheet DateNo matters or circumstances have arisen since the end of the reporting period, not otherwise disclosed in this report, which significantly affected, or may significantly affect, the operations of the Company, the result of those operations, or the state of affairs of the Company in subsequent financial periods.Operations Report continued Country
Patent application or Patent No.
Current Status
Expiry
ATL1103 Patent Portfolio**
USA
USA
USA
7,803,781
8,299,039
8,637,484
Patent Registered
Patent Registered
Patent Registered
International
PCT/US2004/005896
National Phase applications
2004217508
2,517,101
04715642.7
Australia
Canada
Europe
Denmark
Finland
France
Germany
Italy
Patent Registered
Patent Registered
Regional Phase – granted
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
2025*
2024*
2024*
2024*
2024
2024*
2024*
2024*
2024*
2024*
2024*
5
ANNUAL REPORT 2018 Antisense Therapeutics currently has 9 patent families with 85 patents registered or in the process of been registered and 12 patent applications pending covering its two antisense drugs ATL1102 and ATL1103 and their applications. Antisense Therapeutics has also licensed from Ionis Pharmaceuticals, 19 Ionis proprietary patents and applications directed to the antisense drug platform together with rights to 11 other Ionis manufacturing patent families.Since reporting on the status of the Company’s intellectual property portfolio in the 2017 Annual Report the Company has expanded its patent portfolio as follows:• Two European patents and a Canadian patent have been allowed, and a US patent registered as follows:• US patent 9,988,635 has been registered to 2024 covering ATL1103 and other antisense to GHr conjugated to enhance delivery of GHr antisense to the liver to reduce the serum GH binding protein, the soluble form of the GHr;• European 13743020.3 covering ATL1103 and other antisense to GHr used in combination with GHr antagonist Somavert to reduce serum IGF-I has been allowed to 2033 and is in the process of being registered in 10 European countries;• European 15155831.9 and Canadian 2,728562 covering ATL1102 in the treatment of relapsing and active forms of multiple sclerosis with brain lesions have both been allowed to 2029. European 15155831.9 is in the process of being registered in 10 European countries;• International application PCT/Au2016/051059 has been filed in Australia, Canada, Europe and the USA covering the use of ATL1102 in the treatment of the acute myeloid leukemia (AML) to 2036;• International application PCT/AU2018/050598 has been filed covering the use of ATL1102 in the reduction of inflammatory brain lesions converting to black holes for the treatment of multiple sclerosis to 2038;• Australian provisional patent application 2018901531 has been filed covering the use of ATL1102 in the treatment of Duchenne’s Muscular Dystrophy to 2039.The progress outlined above has added significant value to an already extensive intellectual property portfolio. Patents have been registered for the compounds in Antisense Therapeutics' product pipeline, and new applications filed in new indications that underpin Antisense Therapeutics commercialisation plans for its antisense drugs.Intellectual Property Report Country
Patent application or Patent No.
Current Status
Expiry
ATL1103 Patent Portfolio** continued
Spain
Sweden
Switzerland
The Netherlands
United Kingdom
Europe
Denmark
Finland
France
Germany
Italy
Spain
Sweden
Switzerland
The Netherlands
United Kingdom
Japan
Japan
New Zealand
USA
USA
USA
USA
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
11194098.7 Divisional of 04715642.7
Regional Phase – granted
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
4837555
2014-042448 Divisional of 2006-508878
Patent Registered
542,595
7,846,906
8,623,836
9,371,530
9,988,635
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
ATL1103 Combination Patents
International
PCT/AU2013/000095
National Phase Applications
Australian
Canada
2013214698
2863499
Europe***
13743020.3
Japan
New Zealand
USA
USA
2014-555044
629004
9,717,778
9,821,034
International
PCT/AU2014/000613
2014280847
2918787
14810926.7
2016-518801
Australian
Canada
Europe***
Japan
6
Patent Registered
Under Examination
Allowed In the process of
being registered in the 10
European countries above
Under Examination
Patent Registered
Patent Registered
Patent Registered
International Phase
Under Examination
Under Examination
Under Examination
Under Examination
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024*
2024
2024*
2024*
2024*
2024*
2033
2033
2033
2033
2033
2033
2033
2034
2034
2034
2034
2018 ANNUAL REPORT Intellectual Property Report continued Country
Patent application or Patent No.
Current Status
New Zealand
USA
715825
14/897896
ATL1102 Patent Portfolio**
USA
USA
US 5968 826
US 6258 790
Filed
Under Examination
Patent Registered
Patent Registered
International
PCT/US99/18796
National Phase applications
Australia
Canada
Japan
Japan
Europe
Denmark
Finland
France
Germany
Italy
Spain
Sweden
AU 759938
2,345,209
2000-574727
2006-000258
EP1123414
DK/EP1123414
EP(FI)1123414
EP(FR)1123414
DE69934998.2-08
IT40051BE2007
ES2279632
SE99942290.0
United Kingdom
EP(UK)1123414
ATL1102 MS Patent Portfolio
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Regional Phase - granted
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
International
PCT/US2009/003760
National Phase applications
AU 2009271678
2,728562
09798248.2
Patent Registered
Allowed
Regional Phase - granted
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Patent Registered
Allowed In the process of
being registered in the 10
European countries above
Patent Registered
Europe***
15155831.9 Divisional of 09798248.2
Japan
Japan
2011-516297
2014-208153 (Divisional of 2011-5516297)
Patent Registered
Australia
Canada
Europe***
Denmark
Finland
France
Germany
Italy
Spain
Sweden
Switzerland
The Netherlands
United Kingdom
Expiry
2034
2034
2018**
2018*/**
2019*
2019
2019*
2019*
2019*
2019*
2019*
2019*
2019*
2019*
2019*
2019*
2029*
2029
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
2029*
7
ANNUAL REPORT 2018 Intellectual Property Report continued
Country
Patent application or Patent No.
Current Status
Expiry
ATL1102 MS Patent Portfolio continued
USA
USA
PCT
8,415,314
8,759,314
Patent Registered
Patent Registered
PCT/AU2018/050598
Filed
ATL1102 Methods of reducing circulating leukocytes
Australia
Canada
USA
2011301712
2811228
Patent Registered
Under Examination
15/046352 (Continuation of 13/823101)
Under Examination
ATL1102 Therapeutic uses and methods (for treating Muscular Dystrophy)
Provisional
2018901531
Filed
ATL1102 Methods of mobilizing leukaemia cells (for treating AML)
PCT
Australia
Canada
Europe
USA
AU 2016/051059
2016/051059
3007424
16861126.7
15/971938
National Phase applications
Filed
Filed
Filed
Filed
2029*
2029*
2038
2031*
2031*
2031*
2039
2036*
2036*
2036*
2036*
* Potential for up to 5 year extensions to the patent term once the product is a registered drug.
** ATL1102 and ATL1103 are also protected internationally by other Ionis proprietary antisense technology patents and
applications to which Antisense Therapeutics has world-wide license including US7015315 to 2023.
*** Designates all member states of European patent countries including all extension states.
8
2018 ANNUAL REPORT Directors' Report
Directors
The Board of Directors of Antisense Therapeutics Limited present their report on the consolidated entity
(referred to hereafter as ‘the Company’) consisting of Antisense Therapeutics Limited and the entities it
controlled at the end of, or during, the Year Ended 30 June 2018. In order to comply with the provisions of the
Corporations Act 2001, the Board of Directors report as follows:
Mr Robert W Moses BA, MBA, FAICD, FAIM, Independent Non-Executive Chairman
Appointed to the Board
23 October 2001
Last elected by shareholders
1 November 2013
Experience
Robert (Bob) Moses was formerly Corporate Vice President of CSL Limited.
Mr. Moses draws on more than 40 years’ experience in the pharmaceutical/
biotechnology industry. During the period 1993-2001, Mr. Moses played a central role
in CSL's development internationally. Prior to joining CSL, Mr. Moses was Managing
Director of commercial law firm Freehills, Chairman and CEO of a NASDAQ listed
medical service company, and Corporate Manager of New Business Development
at ICI (now Orica). Mr. Moses is also the former Non-Executive Chairman of TGR
Biosciences Pty Ltd. Mr. Moses also spent 17 years in various management roles at the
multinational pharmaceutical company Eli Lilly.
Interest in shares & options
6,721,072 ordinary shares and 1,418,888 options over ordinary shares.
Committees
Chairman of the Remuneration Committee and member of the Audit Committee.
Directorships held in other
listed entities
Nil
Mr Mark Diamond BSc, MBA, Managing Director
Appointed to the Board
31 October 2001
Experience
Mark Diamond has over 30 years’ experience in the pharmaceutical and biotechnology
industry. Before joining Antisense Therapeutics Limited as MD and CEO in 2001, Mr.
Diamond was employed in the US as Director, Project Planning/Business Development
at Faulding Pharmaceuticals. Prior to this he held the positions of Senior Manager,
Business Development and In-licensing within Faulding's European operation based in
the UK and International Business Development Manager with Faulding in Australia.
Interest in shares & options
3,442,144 ordinary shares and 642,772 options over ordinary shares.
Committees
Directorships held in other
listed entities
Nil
Nil
9
ANNUAL REPORT 2018 Directors' Report continued
Dr Graham Mitchell AO, RDA, BVSc, FACVSc, PhD, FTSE, FAA, Independent Non-Executive Director
Appointed to the Board
24 October 2001
Last elected by shareholders
29 November 2017
Experience
Graham Mitchell through Foursight Associates Pty Ltd ("Foursight"), acts as joint
Chief Scientist for the Victorian Government Department of Environment and Primary
Industries. Dr. Mitchell is a Non-Executive Director of Avipep Pty Ltd and is a Principal
of Foursight. Dr. Mitchell has held the position of Director of Research in the R&D
Division of CSL Limited and for many years was a research scientist at The Walter &
Eliza Hall Institute (WEHI). He is currently a Board Member of WEHI.
Interest in shares & options
347,514 ordinary shares and 48,036 options over ordinary shares.
Committees
Member of the Remuneration Committee and Chairman of the Audit Committee.
Directorships held in other
listed entities
Nil
Dr Gary Pace BSc, PhD, Independent Non-Executive Director
Appointed to the Board
9 November 2015
Experience
Gary Pace has more than 40 years of experience in the development and
commercialization of advanced technologies in biotechnology, pharmaceuticals,
medical devices and the food industries. He has long-term board level experience
with both multi-billion and small cap companies. In 2003 Dr. Pace was awarded a
Centenary Medal by the Australian Government “for service to Australian society
in research and development”, and in 2011 was awarded Director of the Year
(corporate governance) by the San Diego Directors Forum. In addition he has held
visiting academic positions at the Massachusetts Institute of Technology and the
University of Queensland. Dr. Pace is an elected Fellow of the Australian Academy of
Technological Sciences and Engineering.
Interest in shares & options
1,236,138 ordinary shares
Committees
Nil
Directorships held in other
listed entities
Dr. Pace is currently a director of ResMed, Pacira Pharmaceuticals Inc. and formerly
late 2015 Transition Therapeutics Inc. and Simavita Limited.
10
2018 ANNUAL REPORT Mr William Goolsbee BA, Independent Non-Executive Director
Appointed to the Board
15 October 2015
Experience
William (Bill) Goolsbee was founder, Chairman and Chief Executive Officer of Horizon
Medical Inc. from 1987 until its acquisition by a unit of UBS Private Equity in 2002.
Mr. Goolsbee was a founding Director of ImmunoTherapy Corporation in 1993, and
became Chairman in 1995, a position he held until overseeing the successful acquisition
of ImmunoTherapy by AVI Biopharma, Inc. (now Sarepta Therapeutics) in 1998. Mr.
Goolsbee served as Chairman of privately held BMG Pharma LLC, a pharmaceutical
company, from 2006 through 2011 and of Metrodora Therapeutics until 2015.
Interest in shares & options
1,014,843 ordinary shares and 84,400 options over ordinary shares.
Committees
Nil
Directorships held in other
listed entities
Mr. Goolsbee was until the end of 2016 a Director of Sarepta Therapeutics Inc.
Mr Phillip Hains, Company Secretary and Chief Financial Officer
Appointed
9 November 2006
Experience
Phillip Hains is a Chartered Accountant operating a specialist public practice, 'The
CFO Solution'. The CFO Solution focuses on providing back office support, financial
reporting and compliance systems for listed public companies. A specialist in the public
company environment, Mr Hains has served the needs of a number of company boards
and their related committees. He has over 30 years' experience in providing businesses
with accounting, administration, compliance and general management services.
Principal Activities
Likely Developments and Expected Results
The principal activity of Antisense Therapeutics
Limited during the financial year was the research and
development of novel antisense pharmaceuticals.
The likely developments in the Company's operations, to
the extent that such matters can be commented upon, are
covered in the 'Operations Report’.
Dividends
Operating and Financial Review
No dividends have been paid or declared since the
end of the previous financial year, nor do the Directors
recommend the declaration of a dividend.
Significant Changes in the State of Affairs
There have been no significant changes in the state of
affairs of the Company during the year.
Significant Events After the Balance Date
There have been no significant events occurring after
the balance date which may affect either the Company's
operations or results of those operations or the
Company's state of affairs.
The net loss after tax of the Company for Year Ended
30 June 2018 was $2,331,015 (2017 loss : $2,754,799)
This result has been achieved after fully expensing all
research and development costs.
The Company had a cash reserve (including Term
Deposits greater than three months) of $4,299,059 at 30
June 2018. ($1,901,988 at 30 June 2017).
The 'Operations Report' provides further details
regarding the progress made by the Company since
the prior financial period, which have contributed to its
results for the year.
11
ANNUAL REPORT 2018 Directors' Report continued
Biotechnology Companies
– Inherent Risks
Pharmaceutical Research and Development
(R&D)
Pharmaceutical R&D involves scientific uncertainty and
long lead times. Risks inherent in these activities include
uncertainty of the outcome of the Company's research
results; difficulties or delays in development of any of the
Company's drug candidates; and general uncertainty related
to the scientific development of a new medical therapy.
The Company's drug compounds require significant
pre-clinical and human clinical development prior to
commercialisation, which is uncertain, expensive and
time consuming. There may be adverse side effects or
inadequate therapeutic efficacy of the Company's drug
candidates which would prevent further commercialisation.
There may be difficulties or delays in testing any of the
Company's drug candidates. There may also be adverse
outcomes with the broader clinical application of the
antisense technology platform which could have a negative
impact on the Company's specific drug development and
commercialisation plans.
No assurance can be given that the Company's product
development efforts will be successful, that any potential
product will be safe and efficacious, that required regulatory
approvals will be obtained, that the Company's products will
be capable of being produced in commercial quantities at an
acceptable cost or at all, that the Company will have access
to sufficient capital to successfully advance the products
through development or to find suitable development
or commercial partners for the development and or
commercialisation of the products and that any products, if
introduced, will achieve market acceptance.
12
2018 ANNUAL REPORT Risk ManagementThe Board is responsible for overseeing the establishment and implementation of the risk management system, and to review and assess the effectiveness of the Company's implementation of that system on a regular basis.The Board and senior management will continue to identify the general areas of risk and their impact on the activities of the Company. The potential risk areas for the Company include:• efficacy, safety and regulatory risk of pre-clinical and clinical pharmaceutical development;• financial position of the Company and the financial outlook;• economic outlook and share market activity;• changing government policy (Australian and overseas);• competitors' products/research and development programs;• market demand and market prices for therapeutics;• environmental regulations;• ethical issues relating to pharmaceutical research and development;• the status of partnership and contractor relationships;• other government regulations including those specifically relating to the biotechnology and health industries; and• occupational health and safety and equal opportunity law.Management will continue to perform a regular review of the following:• the major risks that occur within the business;• the degree of risk involved;• the current approach to managing the risk; and• where appropriate, determine:• any inadequacies of the current approach; and• possible new approaches that more efficiently and effectively address the risk. Partnering and licensing
Due to the significant costs in drug discovery and
development it is common for biotechnology companies
to partner with larger biotechnology or pharmaceutical
companies to help progress drug development. While
the Company has previously entered into such licensing
agreements with pharmaceutical partners, there is no
guarantee that the Company will be able to maintain such
partnerships or license its products in the future. There
is also no guarantee that the Company will receive back
all the data generated by or related intellectual property
from its licensing partners. In the event that the Company
does license or partner the drugs in its pipeline, there is
no assurance as to the attractiveness of the commercial
terms nor any guarantee that the agreements will generate
a material commercial return for the Company.
Regulatory Approvals
Complex government health regulations, which are
subject to change, add uncertainty to obtaining approval
to undertake clinical development and obtain marketing
approval for pharmaceutical products.
Delays may be experienced in obtaining such approvals, or
the regulatory authorities may require repeat of different
or expanded animal safety studies or human clinical
trials, and these may add to the development cost and
delay products from moving into the next phase of drug
development and up to the point of entering the market
place. This may adversely affect the competitive position
of products and the financial value of the drug candidates
to the Company.
There can be no assurance that regulatory clearance will
be obtained for a product or that the data obtained from
clinical trials will not be subject to varying interpretations.
There can be no assurance that the regulatory authorities
will agree with the Company's assessment of future clinical
trial results.
13
ANNUAL REPORT 2018 CompetitionThe Company will always remain subject to the material risk arising from the intense competition that exists in the pharmaceutical industry. A material risk therefore exists that one or more competitive products may be in human clinical development now or may enter into human clinical development in the future. Competitive products focusing on or directed at the same diseases or protein targets as those that the Company is working on may be developed by pharmaceutical companies or other antisense drug companies including Ionis or any of its other collaboration partners or licensees. Such products could prove more efficacious, safer, more cost effective or more acceptable to patients than the Company product. It is possible that a competitor may be in that market place sooner than the Company and establish itself as the preferred product.Technology and Intellectual Property RightsSecuring rights to technology and patents is an integral part of securing potential product value in the outcomes of pharmaceutical R&D. The Company's success depends, in part, on its ability to obtain patents, maintain trade secret protection and operate without infringing the proprietary rights of third parties. There can be no assurance that any patents which the Company may own, access or control will afford the Company commercially significant protection of its technology or its products or have commercial application, or that access to these patents will mean that the Company will be free to commercialise its drug candidates. The granting of a patent does not guarantee that the rights of others are not infringed or that competitors will not develop technology or products to avoid the Company's patented technology or try to invalidate the Company’s patents, or that it will be commercially viable for the Company to defend against such potential actions of competitors.Environmental Regulation and PerformanceThe Company is involved in pharmaceutical research and development, much of which is contracted out to third parties, and it is the Director’s understanding that these activities do not create any significant/material environmental impact. To the best of the Company's knowledge, the scientific research activities undertaken by, or on behalf of, the Company are in full compliance with all prescribed environmental regulations. Directors' Report continued
Risk Management continued
Directors' Meetings
The number of meetings of Directors (including meetings of committees of Directors) held during the year and the
number of meetings attended by each Director were as follows:
Board Meetings
Meetings of committees
Audit
Remuneration*
No. eligible to
attend
No. attended
No. eligible to
attend
No. attended
No. eligible to
attend
No. attended
Robert W Moses
Mr Mark Diamond
Dr Graham Mitchell
Dr Gary Pace
Mr William Goolsbee
7
7
7
7
7
7
7
6
6
6
2
2
2
2
2
2
2
2
2
2
-
-
-
-
-
-
-
-
-
-
(*) A performance and remuneration review was conducted during the June Board meeting.
Committee Membership
As at the date of this report the Company had an Audit Committee and Remuneration Committee, with membership of
the committees as follows:
Audit Committee
Remuneration Committee*
Chairman
Dr Graham Mitchell
Members
Mr Robert W Moses
Mr Robert W Moses
Dr Graham Mitchell
Indemnification and Insurance of Directors and Officers
Under the Company’s constitution:
(a) To the extent permitted by law and subject to the restrictions in section 199A and 199B of the Corporations Act
2001, the Company indemnifies every person who is or has been an officer of the Company against any liability (other
than for legal costs) incurred by that person as an officer of the Company where the Company requested the officer
to accept appointment as Director.
(b) To the extent permitted by law and subject to the restrictions in sections 199A and 199B of the Corporations Act
2001, the Company indemnifies every person who is or has been an officer of the Company against reasonable legal
costs incurred in defending an action for a liability incurred by that person as an officer of the Company.
The Company has insured its Directors, the Company Secretaries and executive officers for the financial year ended 30
June 2018. Under the Company's Directors' and Officers' Liability Insurance Policy, the Company cannot release to any
third party or otherwise publish details of the nature of the liabilities insured by the policy or the amount of the premium.
Accordingly, the Company relies on section 300(9) of the Corporations Act 2001 to exempt it from the requirement to
disclose the nature of the liability insured against and the premium amount of the relevant policy.
14
2018 ANNUAL REPORT
The Company also has in place a Deed of Indemnity, Access
and Insurance with each of the Directors. This Deed:
Auditor Independence and Non-
Audit Services
(1) indemnifies the Director to the extent permitted by
law and the Constitution against certain liabilities and
legal costs incurred by the Director as an officer of any
Group Company;
(2) requires the Company to maintain, and pay the
premium for, a D&O Policy in respect of the Director;
and
(3) provides the Director with access to particular papers
and documents requested by the Director for a
Permitted Purpose,
both during the time that the Director holds office and
for a seven year period after the Director ceases to be an
officer of any Group Company, on the terms and conditions
contained in the Deed.
Indemnification of Auditors - Ernst and Young
To the extent permitted by law, the Company has agreed
to indemnify its auditors, Ernst and Young, as part of the
terms of its audit engagement agreement against claims
by third parties arising from the audit (for an unspecified
amount). No payment has been made to indemnify Ernst
and Young during or since the financial year.
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.
Auditor’s Independence Declaration
The Auditors Independence Declaration as required
under section 307C of the Corporations Act 2001 for the
year ended 30 June 2018 has been received and can be
found in the ‘Auditor’s Independence Declaration’ section
of this Annual Report.
Non-Audit Services
The following non-audit services were provided by
the entity's auditor, Ernst and Young. The Directors
are satisfied that the provision of non-audit services is
compatible with the general standard of independence
for auditors imposed by the Corporations Act 2001.
The nature and scope of each type of non-audit service
provided means that auditor independence was not
compromised.
Ernst and Young received or are due to receive the
following amounts for the provision of non-audit services:
Tax compliance services
Rounding off
2018
$
19,648
19,648
2017
$
19,250
19,250
The Company is of a kind referred to in ASIC
Corporations (Rounding in Financial/Directors’ Reports)
Instrument 2016/191 and in accordance with that
Instrument, amounts in the consolidated financial
statements and directors’ report have been rounded off
to the nearest dollar, unless otherwise stated.
Share Options on Issue as at the Date of the
Report
Remuneration Report (Audited)
1. Remuneration Report Overview
Unissued Shares
The unissued ordinary shares of Antisense Therapeutics
Limited under option as at the date of this report were:
Class
Date of Expiry
Exercise
Price
No. Under
Option
ANPOB
19 December 2019
$0.08
68,681,794
This Remuneration Report outlines the Director and
Executive remuneration arrangements of the Company as
required by the Corporations Act 2001 and its Regulations.
This report details the nature and amount of remuneration
of each Director of Antisense Therapeutics Limited and all
other Key Management Personnel.
15
ANNUAL REPORT 2018 Directors' Report continued
Remuneration Report (Audited) continued
B. REMUNERATION POLICY VERSUS COMPANY
PERFORMANCE
For the purposes of this report, Key Management
Personnel (KMP) are defined as those persons having
authority and responsibility for planning, directing and
controlling the major activities of the Company, directly
or indirectly, including any Director (whether Executive or
otherwise) of the Company.
This report details the nature and amount of remuneration
for each Director of Antisense Therapeutics Limited, and
for the other Key Management Personnel.
Name
Directors:
Position
Mr Robert W Moses
Independent Non-Executive
Chairman
Mr Mark Diamond
Managing Director
Dr Graham Mitchell
Independent Non-Executive
Director
Mr William Goolsbee Independent Non-Executive
Director
Dr Gary Pace
Independent Non-Executive
Director
Other key management personnel:
Dr George Tachas
Mr Phillip Hains
Director, Drug Discovery &
Patents
Company Secretary and Chief
Financial Officer
2. Principles Used to Determine the Nature and
Amount of Remuneration
A. REMUNERATION POLICY
The Remuneration Policy ensures that Directors and
Senior Management are appropriately remunerated having
regard to their relevant experience, their performance, the
performance of the Company, industry norms/standards
and the general pay environment as appropriate. The
Remuneration Policy has been established to enable the
Company to attract, motivate and retain suitably qualified
Directors and Senior Management who will create value
for shareholders.
The Company's Remuneration Policy is not directly based
on the Company's earnings. Prior to the year ended 30
June 2018, the Company's earnings had remained negative
since inception due to the nature of the Company.
Shareholder wealth reflects this speculative and volatile
market sector. No dividends have ever been declared by
the Company.
The Company continues to focus on the research and
development of its intellectual property portfolio with the
objective of achieving key development and commercial
milestones in order to add further Shareholder value.
The Company’s performance over the previous five
financial years is as follows:
Net loss financial year 2018
Net loss financial year 2017
Net profit financial year 2016
Net loss financial year 2015
Net loss financial year 2014
$2,331,015
$2,754,799
$2,514,443
$706,918
$3,013,272
The Company’s share price over the previous five financial
years is as follows:
30 June 2018
30 June 2017
30 June 2016
30 June 2015
30 June 2014
$0.025
$0.033
$0.031
$0.12
$0.14
C. THE REMUNERATION COMMITTEE
The Remuneration Committee of the Board of Directors
of Antisense Therapeutics Limited is responsible for
overseeing the Remuneration Policy of the Company and
for recommending or making such changes to the policy as
it deems appropriate.
16
2018 ANNUAL REPORT D. NON-EXECUTIVE DIRECTOR REMUNERATION
Structure
Objective
The Remuneration Policy ensures that Non-Executive
Directors are appropriately remunerated having regard
to their relevant experience, individual performance, the
performance of the Company, industry norms/standards
and the general pay environment as appropriate.
Structure
The Company's Constitution and the ASX Listing Rules
specify that the aggregate remuneration of Non-Executive
Directors shall be determined from time to time by a
General Meeting. An amount (not exceeding the amount
approved at the General Meeting) is determined by the
Board and then divided between the Non-Executive
Directors as agreed. The latest determination was at
the General Meeting held on 13 November 2001 when
shareholders approved the aggregate maximum sum to
be paid or provided as remuneration to the Directors as a
whole (other than the Managing Director and Executive
Directors) for their services as $300,000 per annum.
In the year ended 30 June 2018, the Non-Executive
Directors were remunerated in aggregate $223,771 per
annum, excluding superannuation.
The manner in which the aggregate remuneration is
apportioned amongst Non-Executive Directors is reviewed
periodically.
The Board is responsible for reviewing its own
performance. Board, and Board committee performance, is
monitored on an informal basis throughout the year with a
formal review conducted during the financial year.
No retirement benefits are payable other than statutory
superannuation, if applicable.
E. EXECUTIVE DIRECTOR AND EXECUTIVE OFFICER
REMUNERATION
Objective
The Remuneration Policy ensures that Executive
Directors are appropriately remunerated having regard
to their relevant experience, individual performance, the
performance of the Company, industry norms/standards
and the general pay environment as appropriate.
The Non-Executive Directors are responsible for
evaluating the performance of the Managing Director,
who in turn evaluates the performance of the other
Senior Executives. The evaluation process is intended
to assess the Company's business performance, whether
long-term strategic objectives are being achieved and the
achievement of individual performance objectives.
The performance of the Managing Director and Senior
Executives are monitored on an informal basis throughout
the year and a formal evaluation is performed annually.
Fixed Remuneration
Executives' fixed remuneration comprises salary and
superannuation and is reviewed annually by the Managing
Director, and in turn, the Remuneration Committee or the
full Board. This review takes into account the Executives'
experience, performance in achieving agreed objectives
and market factors as appropriate.
Variable Remuneration - Short Term Incentive Scheme
All Executives are entitled to participate in the Employee
Short Term Incentive Scheme which provides for annual
cash bonuses for outstanding performance in the
achievement of key corporate and individual objectives.
The Remuneration Committee approves the issue of
cash bonuses following the recommendations of the
Managing Director in his review of the performance of the
Executives and the Company as a whole.
The Short Term Incentive Scheme operates as follows:
The Board determines whether Executives are eligible
for bonuses on an annual basis. The cash bonuses, based
on the recommendations of the Managing Director for
outstanding performance, are not linked to any specific
Key Result Areas (KRA’s). The maximum achievable
bonus for an Executive is 35% of the Executive's base
salary. There were no bonuses paid under the Short Term
Incentive Scheme during the year.
Variable Remuneration - Long Term Incentive Scheme
Executives may also be provided with longer-term incentives
through the Company's Employee Option Plan, to allow the
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. There
were no options granted under the Long Term Incentive
Scheme during the year.
17
ANNUAL REPORT 2018 Directors' Report continued
Remuneration Report (Audited) continued
3. Details of Remuneration
A. DETAILS OF REMUNERATION
The remuneration for each Director and each of the other Key Management Personnel of the Company during the Year
Ended 30 June 2018 was as follows:
30 June 2018
Directors
Mr Robert W Moses
Mr Mark Diamond
Dr Graham Mitchell
Mr William Goolsbee (1)
Dr Gary Pace (1)
Other Key Management Personnel
Dr George Tachas
Mr Phillip Hains (2)
Short-term employee
benefits
Post-employment
Benefits
Long-term
Benefits
Cash salary & fees
$
Pension & Super
Contribution $
Long Service
Leave $
Total $
56,293
366,000
36,500
65,489
65,489
589,771
220,185
99,000
319,185
908,956
5,348
27,450
3,468
-
-
-
61,641
6,991
400,441
-
-
-
39,968
65,489
65,489
36,266
6,991
633,028
20,918
-
20,918
57,184
4,206
-
4,206
11,197
245,309
99,000
344,309
977,337
(1) The US Directors are paid USD$50,000 per annum.
(2) Remunerated through The CFO Solution (see Section 5 below and the Company Secretary details above for further detail).
The remuneration for each Director and each of the other Key Management Personnel of the Company during the Year
Ended 30 June 2017 was as follows:
30 June 2017
Directors
Mr Robert W Moses
Mr Mark Diamond
Dr Graham Mitchell
Mr William Goolsbee (1)
Dr Gary Pace (1)
Other Key Management Personnel
Dr George Tachas
Mr Phillip Hains (2)
Short-term employee
benefits
Post-employment
Benefits
Long-term
Benefits
Cash salary & fees
$
Pension & Super
Contribution $
Long Service
Leave $
Total $
56,293
366,000
36,500
50,458
50,458
559,709
220,185
99,000
319,185
878,894
5,348
22,875
3,468
-
-
-
61,641
6,991
395,866
-
-
-
39,968
50,458
50,458
31,691
6,991
598,391
17,471
-
17,471
49,162
4,206
-
4,206
11,197
241,862
99,000
340,862
939,253
(1) The US Directors are paid USD$50,000 per annum.
(2) Remunerated through The CFO Solution (see Section 5 below and the Company Secretary details above for further detail).
18
2018 ANNUAL REPORT
4. Share-Based Compensation
Shareholdings
The number of shares in the Company held during the financial year by each Director and other Key Management
Personnel of the Company, including their personally related parties, are set out below.
No shares were granted to Directors and Key Management Personal during the period as compensation.
30 June 2018
Directors
Balance at
start of the
year
Granted
as Com-
pensation
Options
Exercised
Net
Change
Other
Total
Balance held nominally
at the end of the
reporting period
Mr Robert W Moses
5,000,000
Mr Mark Diamond
Dr Graham Mitchell
Mr William Goolsbee
Dr Gary Pace
1,721,072
264,180
422,000
618,069
8,025,321
Other Key Management Personnel
Dr George Tachas
Mr Phillip Hains (1)
769,032
4,327,810
5,096,842
13,122,163
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,721,072
6,721,072
1,721,072
3,442,144
83,334
347,514
592,843
1,014,843
618,069
1,236,138
4,736,390
12,761,711
767,532
1,536,564
1,274,718
5,602,528
2,042,250
7,139,092
6,778,640 19,900,803
-
-
-
-
-
-
-
-
-
-
(1) Remunerated through The CFO Solution (see Section 5 below and the Company Secretary details above for further detail).
Options and Rights
The number of options over ordinary shares in the Company held during the financial year by each Director of Antisense
Therapeutics Limited and other Key Management Personnel of the Company, including their personally related parties, are
set out below:
30 June 2018
Balance
at start of
the year
Granted
as Com-
pensation
Options
Exercised
Net
Change
Other
Total
vested at
end of the
year
Total vested
and exercisable
at the end of
the year
Balance held
nominally at
the end of the
reporting period
Directors
Mr Robert W Moses
1,418,888
Mr Mark Diamond
Dr Graham Mitchell
Mr William Goolsbee
Dr Gary Pace
642,772
48,036
84,400
-
2,194,096
Other Key Management Personnel
Dr George Tachas
Mr Phillip Hains (1)
153,808
928,471
1,082,279
3,276,375
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,418,888
1,418,888
642,772
48,036
84,400
-
642,772
48,036
84,400
-
- 2,194,096
2,194,096
-
-
-
-
153,808
928,471
1,082,279
3,276,375
153,808
928,471
1,082,279
3,276,375
-
-
-
-
-
-
-
-
-
-
(1) Remunerated through The CFO Solution (see Section 5 below and the Company Secretary details above for further detail).
19
ANNUAL REPORT 2018 Directors' Report continued
Remuneration Report (Audited) continued
(B) LOANS TO DIRECTORS AND OTHER KEY
MANAGEMENT PERSONNEL
5. Employment Contracts of Key Management
Personnel
At the date of this report, the employment conditions of
the Managing Director, Mr Mark Diamond and other Key
Management Personnel were formalised in contracts
of employment. Mr Mark Diamond is employed under
a contract, which commenced on 31 October 2001.
Subsequent to this contract a notice period for Mr
Diamond of between two and four months was negotiated
depending upon the party ending the agreement.
Antisense Therapeutics Limited has a contract with The
CFO Solution, a specialist public practice, focusing on
providing back office support, financial reporting and
compliance systems for listed public companies. Through
this contract the services of Mr Phillip Hains were provided.
The contract commenced on 9 November 2006 and can
be terminated with three months’ notice of either party.
6. Additional Information
(A) EQUITY ISSUED AS PART OF REMUNERATION FOR
THE YEAR ENDED 30 JUNE 2017
There were no loans made to Directors or other Key
Management Personnel of the Company, including their
personally related parties.
(C) OTHER TRANSACTIONS WITH OTHER KEY
MANAGEMENT PERSONNEL
Transactions between Key Management Personnel are
on normal commercial terms and conditions no more
favourable than those available to other parties unless
otherwise stated.
Signed in accordance with a resolution of the Directors.
Mr Robert W Moses
Independent Non-Executive Chairman
During the financial year ended 30 June 2018, Nil options
have been exercised. No options were granted or lapsed by
any of the Key Management Personnel.
Mr Mark Diamond
Managing Director and Chief Executive Officer
Dated: This day 29th day of August 2018
20
2018 ANNUAL REPORT Auditor’s Independence Declaration
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com
Auditor’s Independence Declaration to the Directors of Antisense
Therapeutics Limited
As lead auditor for the audit of Antisense Therapeutics Limited for the financial year ended 30 June 2018, I
declare to the best of my knowledge and belief, there have been:
a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation
to the audit; and
b) no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Antisense Therapeutics Limited and the entities it controlled during the
financial year.
Ernst & Young
Joanne Lonergan
Partner
Melbourne
29 August 2018
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
21
ANNUAL REPORT 2018 Corporate Governance
22
2018 ANNUAL REPORT The Board of Directors of Antisense Therapeutics Limited ("the Company") is responsible for the corporate governance of the Company and guides and monitors the business and affairs of the Company on behalf of its shareholders.The format of the Corporate Governance Statement is based on the Australian Stock Exchange Corporate Governance Council's ("the Council") "Corporate Governance Principles and Recommendations". In accordance with the Council's recommendations, the Corporate Governance Statement must contain certain specific information and must disclose the extent to which the Company has followed the guidelines during the period.Where a recommendation has not been followed, that fact must be disclosed, together will the reasons for the departure. The Company’s Corporate Governance Statement is structured with reference to the Council's principles and recommendations, which are as follows:Principle 1. Lay solid foundations for management and oversightPrinciple 2. Structure the board to add valuePrinciple 3. Act ethically and responsiblyPrinciple 4. Safeguard integrity in corporate reportingPrinciple 5. Make timely and balanced disclosurePrinciple 6. Respect the rights of shareholdersPrinciple 7. Recognise and manage riskPrinciple 8. Remunerate fairly and responsiblyCommensurate with the spirit of the ASX Corporate Governance Principles and Recommendations, the Company has followed each recommendation where the Board has considered the recommendation to be an appropriate benchmark for corporate governance practices, taking into account factors such as the size of the Company and the Board, resources available and activities of the Company. Where the Company's corporate governance practices depart from the Principles and Recommendations, the Board has offered full disclosure of the nature of, and reason for, the adoption of its own practice.The Company’s corporate governance practices were in place throughout the year ended 30 June 2018. For further information on the corporate governance policies adopted by the Company, please refer to its website:www.antisense.com.auPrinciple 1:Lay solid foundations for management and oversightRole of the BoardIt is the role of the Board of Directors to represent and protect the interests of the Company's shareholders. The Board is responsible for the corporate governance of the Company and guides and monitors the business and affairs of the Company.In furtherance of its responsibilities, the Board of Directors will:• review, evaluate, provide input into and approve, on a regular basis, the Company's corporate governance strategy;• monitor senior management's performance and implementation of strategy, and ensure appropriate resources are available;• review, evaluate and approve the Company's budget and forecasts;• review, evaluate, approve and monitor major resource allocations and capital investments, and any acquisitions and divestitures;• review and monitor the financial and operating results of the Company;• review and evaluate the overall corporate organisational structure, the assignment of senior management responsibilities and plans for senior management development and succession;• review, evaluate and approve compensation strategy as it relates to senior management of the Company;• review and ratify systems of risk management and internal compliance and control, codes of conduct, and legal compliance;• appoint and remove the Managing Director (Chief Executive Officer);• ratify the appointment and, where appropriate, the removal of the Chief Financial Officer and the Company Secretary;• monitor its own performance and recommend and implement appropriate changes in composition and size. Role of Management
Through the Chief Executive Officer / Managing Director,
management is responsible to the Board for the:
(1) Development and implementation of agreed
corporate strategy and performance objectives;
(2) Undertaking the day to day activities of the Company;
(3) Identifying all matters to be included in a risk profile
of the Company and ensuring that effective risk
management systems are implemented and adhered to;
(4) Observing the code of conduct;
(5) Ensuring that the Board is fully informed of all matters
which may have a material impact on the ability of the
Company to meet its obligations.
Board Appointments
The Company undertakes comprehensive reference checks
prior to appointing a director, or putting that person
forward as a candidate to ensure that person is competent,
experienced, and would not be impaired in any way from
undertaking the duties of director. The Company provides
relevant information to shareholders for their consideration
about the attributes of candidates together with whether
the Board supports the appointment or re-election.
The terms of the appointment of a non-executive director,
executive directors and senior executives are agreed upon
and set out in writing at the time of appointment.
The Company Secretary
The Company Secretary is accountable directly to the
Board, through the Chairman, on all matters to do with
the proper functioning of the Board, including agendas,
Board papers and minutes, advising the Board and its
Committees (as applicable) on governance matters,
monitoring that the Board and Committee policies and
procedures are followed, communication with regulatory
bodies and the ASX and statutory and other filings.
Diversity
The Company values the differences between its
personnel and the valuable contribution that these
differences can make to the Company. The Company is an
equal opportunity employer and aims to recruit executives
and employees from as diverse a pool of qualified
candidates as reasonably possible based on their skills,
qualifications and experience.
The Company is committed to increasing diversity
amongst its employees, and not just in the area of
gender diversity. Our workforce is employed based
on the right person for the job regardless of their
gender, age, nationality, race, religious beliefs, cultural
background, sexuality or physical ability or appearance.
Executive and Board positions are filled by the best
candidates available without discrimination. The
Company is committed to increasing gender diversity
within these positions when appropriate appointments
become available. The Company is also committed to
identifying suitable persons within the organisation, and
where appropriate opportunities exist, advance diversity
to support the promotion of talented employees into
management positions.
The Company has not set any gender specific diversity
objectives as it believes that multicultural diversity and
other diversity factors are equally important within its
organisation.
The following table demonstrates the Company’s gender
diversity as at 30 June 2018:
Number of
Males
Number of
Females
Directors
Key Management Personnel
Other Company Employees
5
2
-
-
-
1
The Company employed 8 employees at the end of 2018
(2017: 9 employees).
Board Performance Review
The Board considers the ongoing development and
improvement of its own performance, the performance
of individual directors and Board Committees as critical to
effective governance.
The Board has adopted an informal self-evaluation process
to measure its own performance. The performance of the
Board and individual directors is reviewed at least every
year by the Board as a whole. This process includes a
review in relation to the composition and skills mix of the
Directors of the Company. Performance reviews involve
analysis based on key performance indicators aligned with
the financial and non-financial objectives of the Company.
A performance review in accordance with the processes
disclosed occurred during the 2018 financial year.
23
ANNUAL REPORT 2018 Corporate Governance continued
Performance Review of KMP
On at least an annual basis, the Board conducts a formal
performance review of the Chief Executive Officer and
any other key management personnel (KMP). The Board
assesses the performance of KMP against qualitative and
quantitative key performance indicators relevant to each
KMP. A performance review of KMP occurred during the
2018 financial year in accordance with this process.
Independent Advice
The Board has procedures to allow Directors, in the
furtherance of their duties, to seek independent
professional advice at the Company's expense.
Principle 2:
Structure the Board to add value
Board composition
The length of service, skills, experience and expertise
of each Director in office at the date of this report and
throughout the 2018 financial year are included in the
Directors' Report under the section headed 'Directors'.
The Company's Board Charter stipulates that at least
50% of the Directors on the board should be independent
Directors. Directors of Antisense Therapeutics Limited are
considered to be independent when they are independent
of management and free from any business or other
relationship that could materially interfere with the
exercise of their independent judgement.
In the context of Director independence, to be considered
independent, a Non-Executive Director may not have a
direct or indirect material relationship with the Company.
The board considers that a material relationship is one
which impairs or inhibits, or has the potential to impair or
inhibit, a Director's exercise of judgement on behalf of the
Company and its shareholders.
From a quantitative perspective, an item is considered to
be quantitatively immaterial if it is equal to or less than 5%
of the relevant base amount. It is considered to be material
(unless there is qualitative evidence to the contrary) if it is
equal to or greater than 10% of the relevant base amount.
In accordance with the definition of independence above,
and the materiality thresholds described, the majority of
Directors are independent as set out below:
Name
Position
Mr Robert W Moses
Dr Graham Mitchell
Dr Gary Pace
Mr William Goolsbee
Independent Non-Executive
Chairman
Independent Non-Executive
Director
Independent Non-Executive
Director
Independent Non-Executive
Director
In accordance with the definition of independence above,
and the materiality thresholds described, the majority of
Directors are independent as set out below:
Name
Term in Office
Mr Robert W Moses
Mr Mark Diamond
Dr Graham Mitchell
Mr William Goolsbee
Dr Gary Pace
16 years
16 years
16 years
2 years
2 years
To ensure the Board is appropriately equipped to discharge
its responsibilities, it has developed guidelines for the
nomination and selection of Directors and for the operation
of the Board. As the Antisense Therapeutics Limited's
Board is not a large board, a formal nomination committee
has not been established, as it is perceived that no real
efficiencies would be gained from the existence of such
a committee. The charter of the nomination committee
has been incorporated into the Board Charter and by
this action the Board of Directors considers all matters
that would be relevant for a nomination committee. For
additional details please refer to the Company's Board
Charter on its website.
Induction of New Directors and Ongoing
Development
Any new Directors will be issued with a formal Letter of
Appointment that sets out the key terms and conditions
of their appointment, including Director's duties, rights
and responsibilities, the time commitment envisaged, and
the Board's expectations regarding involvement with any
Committee work.
24
2018 ANNUAL REPORT A new director induction program is in place and Directors
are encouraged to engage in professional development
activities to develop and maintain the skills and knowledge
needed to perform their role as Directors effectively.
Principle 3:
Act ethically and responsibly
Code of Conduct
As part of its commitment to recognising the legitimate
interests of stakeholders, the Company has established a
Code of Conduct to guide compliance with legal and other
obligations to legitimate stakeholders.
The Board acknowledges the legitimate interest of various
stakeholders such as employees, clients, customers,
government authorities, creditors and the community
as a whole. As a good corporate citizen, it encourages
compliance and commitment to appropriate corporate
practices that are fair and ethical via its 'Code of Conduct'.
Trading in Company Securities
The Company has a 'Code of Practice - Buying & Selling
of Shares' that regulates the dealings by Directors and
employees, in shares, options and other securities issued
by the Company. The policy has been formulated to
ensure that Directors and employees are aware of the
legal restrictions on trading in Company securities while in
possession of unpublished price sensitive information.
Principle 4:
Safeguard integrity in corporate reporting
The Audit Committee also provides the Board
with additional assurance regarding the reliability
of financial information for inclusion in the financial
statements. All members of the Audit Committee are
Non-Executive Directors. The Audit Committee is also
responsible for the nomination of the external auditor
and for reviewing the adequacy of the scope and quality
of the annual statutory audit and half year statutory
review. The Audit Committee Charter can be found on the
Company's website.
The Audit Committee consists of two independent Non-
Executive Directors. Given the current size of the Company,
the Board believes that an Audit Committee consisting
of two members is sufficient to enable the committee to
discharge its mandate effectively. The members of the
Audit Committee during the year were Dr Graham Mitchell
(Chairperson) and Mr Robert W Moses.
For details on the number of meetings for the Audit
Committee held during the year and the attendances at
those meetings, refer to the Directors' Report under the
section headed 'Meetings of Directors'.
CEO and CFO Declarations
The CEO and CFO have provided the Board with a
declaration that, in their opinion, the financial records
of the entity have been properly maintained and that
the financial statements comply with the appropriate
accounting standards and give a true and fair view of the
financial position and performance of the entity and that
the opinion has been formed on the basis of a sound
system of risk management and internal control which is
operating effectively.
Audit Committee
External Auditor
The Audit Committee operates under a charter approved
by the Board. It is the Board's responsibility to ensure that
an effective control framework exists within the entity. This
includes ensuring that there are internal controls to deal
with both the effectiveness and efficiency of significant
business processes. This includes the safeguarding of
assets, the maintenance of proper accounting records
and the reliability of financial information as well as non-
financial considerations. The Board has delegated the
responsibility for the establishment and maintenance of a
framework of internal control and ethical standards for the
management of the Company to the Audit Committee.
The Company's external auditor attends each annual
general meeting and is available to answer any questions
with regard to the conduct of the audit and their report.
Prior approval of the Board must be gained for non-audit
work to be performed by the external auditor. There are
qualitative limits on this non-audit work to ensure that the
independence of the auditor is maintained.
There is also a requirement that the audit partner
responsible for the audit not perform in that role for more
than five years.
25
ANNUAL REPORT 2018 Corporate Governance continued
Shareholders may elect to, and are encouraged to, receive
communications from the Company and its securities
registry electronically.
The Company maintains information in relation to its
corporate governance documents, Directors and senior
executives, Board and committee charters, annual reports
and ASX announcements on the Company’s website.
Principle 7:
Recognise and managing risk
The Board is committed to the identification, assessment
and management of risk throughout the Company’s
business activities.
The Board has established a policy for risk oversight and
management within the Company. This is periodically
reviewed and updated. Management reports risks
identified to the Board through the monthly Operations
Report, and via direct and timely communication to the
Board where and when applicable. During the reporting
period, management has reported to the Board as to
the effectiveness of the Company’s management of its
material business risks. The Company does not have an
internal audit function.
The Company faces risks inherent to its business,
including economic risks, which may materially impact
the Company’s ability to create or preserve value for
security holders over the short, medium or long term. The
Company has in place policies and procedures, including
a risk management framework (as described in the
Company’s Risk Management Policy), which is developed
and updated to help manage these risks. The Board does
not consider that the Company currently has any material
exposure to environmental or social sustainability risks.
The Company does not have separate risk committee.
The Board as whole is responsible is responsible for
overseeing the establishment and implementation of the
risk management system. Due to the size of the Board and
the Company, it is perceived that no real efficiencies would
be gained from the existence of separate risk committee.
The Board review’s the entity’s risk management
framework at least annually to satisfy itself that it
continues to be sound. A review of the Company’s risk
management framework was conducted during the 2018
financial year.
26
2018 ANNUAL REPORT Principle 5:Making timely and balanced disclosureThe Company has a Disclosure Policy which outlines the disclosure obligations of the Company as required under the ASX Listing Rules and Corporations Act. The policy is designed to ensure that procedures are in place so that the market is properly informed of matters which may have a material impact on the price at which Company securities are traded.The Board has designated the Company Secretary as the person responsible for overseeing and co-ordinating disclosure of information to the ASX as well as communicating with the ASX. In accordance with ASX Listing Rules the Company immediately notifies the ASX of information concerning the Company:(a) that a reasonable person would or may expect to have a material effect on the price or value of the Company's securities; and(b) that would, or would be likely to, influence persons who commonly invest in securities in deciding whether to acquire or dispose of the Company's securities.Principle 6:Respect the rights of shareholdersThe Company is committed to providing current and relevant information to its shareholders.The Company respects the rights of its shareholders, and to facilitate the effective exercise of the rights, the Company is committed to:(a) communicating effectively with shareholders through ongoing releases to the market via ASX information and general meetings of the Company;(b) giving shareholders ready access to balanced and understandable information about the Company and corporate proposals;(c) making it easy for shareholders to participate in general meetings of the Company; andAny shareholder wishing to make inquiries of the Company is advised to contact the registered office. All public announcements made by the Company can be obtained from the ASX's website www.asx.com.au Principle 8:
Remunerate fairly and responsibly
It is the Company's objective to maintain a high quality
Board and executive team by remunerating Directors at
relevant market conditions. To assist in achieving this
objective the Remuneration Committee remunerates
Directors and executives having regard to their
performance and the performance of the Company.
The expected outcomes of the remuneration policies and
practices are to enable the Company to motivate, retain
and attract Directors and executives who will create value
for shareholders.
Details relating to the policy for performance evaluation
and the amount of remuneration (monetary and non-
monetary) paid to each Director and to each of the five
highest-paid (non-director) executives during the year, are
set out in the Directors' Report under the section headed
'Remuneration Report'.
The members of the Remuneration Committee at the date
of this report were all independent Non-Executive Directors,
being Mr Robert W Moses and Dr Graham Mitchell. Details
relating to performance evaluation are set out in the
Directors' Report under the section headed 'Remuneration
Report'. For details on the number of meetings of the
Remuneration Committee held during the year and the
attendees at those meetings, refer to the Directors' Report
under the section headed 'Meetings of Directors'.
In accordance with the Company’s share trading policy,
participants in any equity based incentive scheme are
prohibited from entering into any transaction that would
have the effect of hedging or otherwise transferring the risk
of any fluctuation in the value of any unvested entitlement
in the Company’s securities to any other person.
Further details in relation to the company’s remuneration
policies are contained in the Remuneration Report, within
the Directors’ report.
27
ANNUAL REPORT 2018 Annual Financial Statements
For the year ended 30 June 2018
Consolidated Statement of Profit or Loss
and other Comprehensive Income
29
Consolidated Statement of Financial
Position
Consolidated Statement of Changes in
Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
Company Information
30
31
32
33
55
56
60
62
28
2018 ANNUAL REPORT Consolidated Statement of Profit or Loss
and other Comprehensive Income
For the year ended 30 June 2018
Revenue
Other income
Depreciation expenses
Administrative expenses
Occupancy expenses
Patent expenses
Research and development expenses
Foreign exchange gains/(losses)
Loss before tax
Income tax benefit
Loss for the year
Other comprehensive income/(loss) for the year, net of tax
Total comprehensive loss for the year, net of tax
Loss per share
Basic loss per share
Diluted loss per share
The accompanying notes form part of these financial statements.
Notes
3
3
4
4
4
4
4
4
5
8
8
2018
$
25,553
272,424
297,977
2017
$
140,169
399,203
539,372
(6,413)
(4,890)
(1,313,949)
(1,855,147)
(114,062)
(119,795)
(210,316)
(202,924)
(975,403)
(1,103,966)
(8,849)
(7,449)
(2,331,015)
(2,754,799)
-
-
(2,331,015)
(2,754,799)
-
-
(2,331,015)
(2,754,799)
($1.20)
($1.20)
($1.71)
($1.71)
29
ANNUAL REPORT 2018
Consolidated Statement of Financial Position
For the year ended 30 June 2018
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Prepayments
Other current assets
Non-Current Assets
Plant and equipment
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Employee benefit liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Accumulated losses
TOTAL EQUITY
The accompanying notes form part of these financial statements.
Notes
2018
$
2017
$
9
10
11
12
13
14
1,899,059
1,901,988
331,162
164,235
2,400,000
427,894
165,105
30,000
4,794,456
2,524,987
7,675
7,675
14,088
14,088
4,802,131
2,539,075
332,619
248,241
364,346
321,306
580,860
685,652
4,221,271
1,853,423
15
62,405,510
56,714,725
(58,184,239)
(53,098,425)
4,221,271
4,577,155
30
2018 ANNUAL REPORT
Consolidated Statement of Changes in Equity
For the year ended 30 June 2018
As at 1 July 2016
Loss for the period
Total comprehensive income
Issue of options
15
Transactions costs on options issues/
capital raising
Shares issued
At 30 June 2017
As at 1 July 2017
Loss for the period
Total comprehensive income
Issue of share capital
Transactions costs on options issues/
capital raising
Shares issued
At 30 June 2018
15.a
15.b
Contributed
Equity
(Note 15)
Notes
Reserves
(Note 16)
Accumulated
Losses
Total
$
$
$
$
56,714,725
960,855 (53,098,425)
4,577,155
-
-
73,169
(42,102)
-
-
-
-
960,855
(960,855)
57,706,647
57,706,647
-
-
5,040,653
(344,350)
2,560
62,405,510
-
-
-
-
-
-
-
-
(2,754,799)
(2,754,799)
(2,754,799)
(2,754,799)
-
-
-
73,169
(42,102)
-
(55,853,224)
1,853,423
(55,853,224)
1,853,423
(2,331,015)
(2,331,015)
(2,331,015)
(2,331,015)
-
-
-
5,040,653
(344,350)
2,560
(58,184,239)
4,221,271
The accompanying notes form part of these financial statements.
31
ANNUAL REPORT 2018 Consolidated Statement of Cash Flows
For the year ended 30 June 2018
OPERATING ACTIVITIES
Licensing fees received
Payments to suppliers and employees
Interest received
R&D tax concession refund
Notes
2018
$
-
2017
$
69,115
(2,718,085)
(3,456,562)
16,918
399,374
77,628
395,597
Net cash flows used in operating activities
19
(2,301,793)
(2,914,222)
INVESTING ACTIVITIES
Purchase of property, plant and equipment
12
-
(15,575)
Term Deposits (Over 90+ days)
Net cash flows used in investing activities
(2,400,000)
-
(2,400,000)
(15,575)
FINANCING ACTIVITIES
Proceeds from issues of securities
Capital raising costs
Net cash flows from financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at 1 July
Cash and cash equivalents at 30 June
The accompanying notes form part of these financial statements.
5,043,214
(344,350)
4,698,864
73,169
(42,102)
31,067
9
9
(2,929)
(2,898,730)
1,901,988
4,800,718
1,899,059
1,901,988
32
2018 ANNUAL REPORT
Notes to the Financial Statements
For the year ended 30 June 2018
Judgements made by management in the
application of Australian Accounting Standards that
have significant effects on the financial statements and
estimates with a significant risk of material adjustments
in the next year are disclosed, where applicable, in the
relevant notes to the financial statements.
Accounting policies are selected and applied in a manner
which ensures that the resulting financial information
satisfies the concepts of relevance and reliability, thereby
ensuring that the substance of the underlying transactions
or other events is reported.
GOING CONCERN
Some of the risks inherent in the development of
pharmaceutical product include the uncertainty of
patent protection and proprietary rights, whether patent
applications and issued patents will offer adequate
protection to enable and commercially justify product
development or may infringe intellectual property rights of
other parties, and uncertainty in obtaining the necessary
clinical trial and/or regulatory authority approvals for product
development and commercialisation. Also a particular
compound may fail to achieve sufficient efficacy or safety
in the research and the clinical development process, or its
viability may be negatively impacted by strategic imperatives
including an assessment that the projects may not deliver a
sufficient return on investment or has been or may likely be
superseded by newer and potentially superior competitive
products or technologies. There is a risk that the Company
will be unable to find suitable development or commercial
partners for its projects, and that these arrangements may
not generate a material return for the Company.
In the period the Company completed a capital raising via
a share placement to Australian Ethical Investment and a
pro-rata Entitlement Issue to shareholders. The ability of
the Company to access additional capital in future years for
the further development of its projects, and the amount of
additional funds required will be dependent on the outcome
of its product development programs along with the
receptiveness of the capital markets to such capital raising
initiatives at the time.
Note 1:
Significant Accounting Policies
1.a Corporate Information
The financial report of Antisense Therapeutics Limited
and its subsidiaries (the ‘Company’) for the Year Ended
30 June 2018 was authorised for issue in accordance with
a resolution of the Directors on 28th August 2018. The
financial report is for the Company consisting of Antisense
Therapeutics Limited and its subsidiaries.
Antisense Therapeutics Limited is a listed public company
limited by shares incorporated and domiciled in Australia
whose shares are publicly traded on the Australian
Securities Exchange. The Company also has a Level 1
American Depository Receipt (ADR) program traded on
the US over-the-counter market.
The principal activity of the Company is the research and
development of novel antisense pharmaceuticals.
1.b Basis of Preparation
The financial report is a general purpose financial
report, which has been prepared in accordance with the
requirements of the Corporations Act 2001 and Australian
Accounting Standards, required for a for-profit entity.
The financial report has been prepared on an accruals
basis and is based on historical costs. These consolidated
financial statements are presented in Australian dollar
($), which is the Company’s functional and presentation
currency. The Company is of a kind referred to in
ASIC Corporations (Rounding in Financial/Directors’
Reports) Instrument 2016/191 and in accordance with
that instrument, amounts in the consolidated financial
statements and directors’ report have been rounded off to
the nearest thousand dollars, unless otherwise stated.
Management is required to make judgements, estimates
and assumptions about carrying values of assets and
liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on
historical experience and various other factors that are
believed to be reasonable under the circumstance, the
results of which form the basis of making the judgements.
Actual results may differ from these estimates. The
estimates and underlying assumptions are reviewed on
an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised
if the revision affects only that period, or in the period of
the revision and future periods if the revision affects both
current and future periods.
33
ANNUAL REPORT 2018 Notes to the Financial Statements
For the year ended 30 June 2018
Note 1:
Significant Accounting Policies continued
1.b Basis of Preparation continued
GOING CONCERN continued
The Company has incurred a loss after tax of $2,331,015 the year ended 30 June 2018, had an operating cash outflow of
$2,301,793 and has a net current asset position of $4,221,271. The financial statements have been prepared on a going
concern basis. Accordingly the financial statements do not include adjustments relating to the recoverability and classification
of recorded asset amounts, or the amounts and classification of liabilities that might be necessary should the Company not
continue as a going concern.
1.c Statement of Compliance
The financial report complies with Australian Accounting Standards as issued by the Australian Accounting Standards
Board and International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board.
1.d New, Revised or Amending Accounting Standards and Interpretations Adopted
The following new, revised or amended Accounting Standards have been adopted for the year ended 30 June 2018:
• AASB 2016-2 Amendments to Australian Accounting standards - Disclosure Initiative: amendments to AASB 107 This
amendment requires the Group to provide disclosures about changes in borrowings, including both changes arising
from cash flows and non-cash changes.
The following Australian Accounting Standards and Interpretations have recently been issued or amended but are not yet
effective and therefore have not been adopted by the Company for the annual reporting period ended 30 June 2018:
Application
date
1 July 2018
Title
Nature of change
Impact
Application
1 January
2018
AASB 9 introduces new requirements for the
classification and measurement of financial assets and
liabilities and includes a forward-looking ‘expected
loss’; impairment model and a substantially-changed
approach to hedge accounting. These requirements
improve and simplify the approach for classification
and measurement of financial assets compared with
the requirements of AASB 139. The main changes are:
a Financial assets that are debt instruments will be
classified based on:
(i) the objective of the entity’s business model for
managing the financial assets; and
(ii) the characteristics of the contractual cash
flows.
b Allows an irrevocable election on initial recognition
to present gains and losses on investments in
equity instruments that are not held for trading in
other comprehensive income (instead of in profit
or loss). Dividends in respect of these investments
that are a return on investment can be recognised
in profit or loss and there is no impairment or
recycling on disposal of the instrument.
Introduces a ‘fair value through other
comprehensive income’; measurement category
for particular simple debt instruments.
c
When assessing
the impact of AASB
9, management
considered the
nature of the
Company's financial
instruments, which
primarily comprise
of receivables from
the Australian Tax
Office (for R&D
tax incentives) and
payables to creditors
for services rendered.
No other material
debtors have been
identified, nor are
expected to be. Based
on this assessment,
management
concluded the impact
of AASB 9 on the
financial report to be
minimal.
AASB 9
Financial
instruments
34
2018 ANNUAL REPORT Title
Nature of change
Impact
Application
Application
date
1 July 2018
1 January
2018
AASB 9
Financial
instruments
cont'd
AASB 15
Revenue
from
contracts
with
customers
d Financial assets can be designated and measured
at fair value through profit or loss at initial
recognition if doing so eliminates or significantly
reduces a measurement or recognition
inconsistency that would arise from measuring
assets or liabilities, or recognising the gains and
losses on them, on different bases.
e Where the fair value option is used for financial
liabilities the change in fair value is to be accounted
for as follows:
• the change attributable to changes in credit risk are
presented in Other Comprehensive Income (OCI)
the remaining change is presented in profit or loss
If this approach creates or enlarges an accounting
mismatch in the profit or loss, the effect of the
changes in credit risk are also presented in profit or
loss. Otherwise, the following requirements have
generally been carried forward unchanged from
AASB 139 into AASB 9:
• classification and measurement of financial
liabilities; and derecognition requirements for
financial assets and liabilities AASB 9 requirements
regarding hedge accounting represent a substantial
overhaul of hedge accounting that enable entities
to better reflect their risk management activities
in the financial statements. Furthermore, AASB
9 introduces a new impairment model based on
expected credit losses. This model makes use of
more forward-looking information and applies to all
financial instruments that are subject to impairment
accounting.
AASB 15 − replaces AASB 118 Revenue, AASB
111 Construction Contracts and some revenue-
related Interpretations− establishes a new revenue
recognition model − changes the basis for deciding
whether revenue is to be recognised over time or
at a point in time − provides new and more detailed
guidance on specific topics (e.g. multiple element
arrangements, variable pricing, rights of return,
warranties and licensing) − expands and improves
disclosures about revenue.
1 January
2018
1 July 2018
The Company is
not generating
any revenue from
contracts with
customers and thus
the impact of AASB
15 is concluded to be
minimal.
35
ANNUAL REPORT 2018 Title
Nature of change
Impact
Application
AASB 16
Leases
AASB 16 − replaces AASB 117 Leases and some
lease-related Interpretations− requires all leases to be
accounted for ‘on-balance sheet’ by lessees, other than
short-term and low value asset leases− provides new
guidance on the application of the definition of lease
and on sale and lease back accounting− largely retains
the existing lessor accounting requirements in AASB
117− requires new and different disclosures about
leases.
1 January
2019
The Company only
has one operating
lease arrangement in
relation to the office
rental - which is on a
short term basis (12
months). Therefore
management does
not expect AASB 16 to
have a material impact
on the Company's
financial report.
Application
date
1 July 2019
1.e Principles of Consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Antisense Therapeutics
Ltd as at 30 June 2018 and the results of all subsidiaries for the year then ended.
Subsidiaries are all those entities where the Company is exposed, or has rights, to variable returns from the Company’s
involvement with the entity and has the ability to affect those returns through the Company’s power to direct the
activities of the entity. The existence and effect of potential voting rights that are currently exercisable or convertible are
considered when assessing whether the Company controls another entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are de-
consolidated from the date that control ceases.
In preparing the consolidated financial statements, all intercompany balances and transactions, and unrealised profits/
losses arising within the consolidated entity are eliminated in full. Investments in subsidiaries are accounted for at cost in
the separate financial statements of Antisense Therapeutics Limited.
1.f Summary of Significant Accounting Policies
a) Revenue Recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the
revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is
recognised.
b) Government Grants
Government grants are recognised when there is reasonable assurance that the grant will be received and all grant
conditions will be complied with.
When the grant relates to an expense item, it is recognised as income over the periods necessary to match the grant
on a systematic basis to the costs that it is expected to compensate.
36
2018 ANNUAL REPORT Notes to the Financial StatementsFor the year ended 30 June 2018Note 1:Significant Accounting Policies continued1.d New, Revised or Amending Accounting Standards and Interpretations Adopted continued
1.f Summary of Significant Accounting Policies
h)
Income Taxes
continued
c) Borrowing Costs
Borrowing costs are expensed as incurred.
d) Leases
The minimum lease payments of operating leases,
where the lessor effectively retains substantially all of
the risks and benefits of ownership of the leased item,
are recognised as an expense on a straight-line basis.
e) Cash and Cash Equivalents
Cash and short-term deposits in the Statement of
Financial Position comprise cash at bank and in hand
and short-term deposits with an original maturity of
three months or less.
For the purposes of the Cash Flow Statement,
cash and cash equivalents consist of cash and cash
equivalents as defined above.
f) Trade and Other Receivables
Trade and other receivables are recognised initially at
fair value and subsequently measured at amortised cost
using the effective interest method, less an allowance for
impairment, once they become over due by more than
60 days. A separate account records the impairment.
An allowance for a doubtful debt is made when there
is objective evidence that the Company will not be able
to collect the debts. The criteria used to determine
that there is objective evidence that an impairment
loss has occurred include whether the Financial Asset
is past due and whether there is any other information
regarding increased credit risk associated with the
Financial Asset. Bad debts which are known to be
uncollectible are written off when identified.
g) Foreign Currencies
The functional currency of the Company is based
on the primary economic environment in which the
Company operates. The functional currency of the
Company is Australian dollars.
Transactions in foreign currencies are converted to
local currency at the rate of exchange at the date of
the transaction.
Amounts payable to and by the Company outstanding
at reporting date and denominated in foreign
currencies have been converted to local currency using
rates prevailing at the end of the financial year.
All exchange differences are taken to profit or loss.
Deferred income tax is provided on all temporary
differences at the balance date between the tax
bases of assets and liabilities and their carrying
amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for
all taxable temporary differences except where the
deferred income tax liability arises from the initial
recognition of an asset or liability in a transaction that
is not a business combination and, at the time of the
transaction, affects neither the accounting loss nor
taxable profit or loss.
Deferred income tax assets are recognised for all
deductible temporary differences, carry-forward of
unused tax assets and unused tax losses, to the extent
that it is probable that taxable profit will be available
against which the deductible temporary differences,
and the carry-forward of unused tax assets and unused
tax losses can be utilised except where the deferred
income tax asset relating to the deductible temporary
differences arises from the initial recognition of an
asset or liability in a transaction that is not a business
combination and, at the time of transaction, affects
neither the accounting loss nor taxable profit or loss.
The carrying amount of deferred income tax assets
is reviewed at each balance date and reduced to the
extent that it is no longer probable that sufficient
taxable profit will be available to allow all or part of the
deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured
at the tax rates that are expected to apply to the year
when the asset is realised or the liability is settled,
based on tax rates (and tax laws) that have been
enacted or substantively enacted at balance date.
Deferred Tax assets are recognised for unused tax
losses to the extent that it is probable that taxable
profit will be available against which the losses can be
utilised. Significant management judgement is required
to determine the amount of deferred tax assets that
can be recognised, based upon the likely timing and
the level of future taxable profits together with future
tax planning strategies.
Given the history of losses, there is limited support for
the recognition of these losses as deferred tax assets.
On this basis, Antisense Therapeutics Limited has
determined it cannot recognise deferred tax assets on
the tax losses carried forward. Further, on this basis,
deferred tax assets have not been recognised related
to temporary differences.
37
ANNUAL REPORT 2018
Notes to the Financial Statements
For the year ended 30 June 2018
38
2018 ANNUAL REPORT 1.f Summary of Significant Accounting Policies continuedh) Income Taxes continued Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.i) Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except:• where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and• receivables and payables are stated with the amount of GST included. Cash flows arising from operating activities are included in the Cash Flow Statement on a gross basis (i.e. including GST) and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows. Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority. The net amount of GST recoverable from or payable to, the taxation authority is included as part of the receivables or payables in the Statement of Financial Position.j) Plant and Equipment Plant and equipment are measured at cost less any accumulated depreciation and any impairment losses. Such assets are depreciated over their useful economic lives as follows: Life Method Equipment 3-5 years Straight linek) Research and Development Costs Research costs are expensed as incurred. An intangible asset arising from development expenditure on an internal project is recognised only when the Company can demonstrate the technical feasibility of completing the intangible asset so that it will be available for use or sale, its intention to complete and its ability to use or sell the asset, how the asset will generate future economic benefits, the availability of resources to complete the development. Following initial recognition of the development expenditure, the cost model is applied requiring the asset to be carried at cost less any accumulated amortisation and accumulated impairment losses. Any expenditure so capitalised is amortised over the period of expected benefits from the related project. The carrying value of an intangible asset arising from development expenditure is tested for impairment annually when the asset is not available for use, or more frequently when an indication of impairment arises during the reporting period.l) Impairment of Non-Financial Assets The carrying values of non-financial 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. 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 that are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets that suffer an impairment are tested for possible reversal of the impairment whenever events or changes in circumstances indicate that the impairment may have reversed. An impairment exists when the carrying value of an asset exceeds its estimated recoverable amount. The asset is then written down to its recoverable amount.m) Trade and Other Payables Trade and other payables are carried at amortised cost and represent liabilities for goods and services provided to the Company prior to the end of the financial year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of these goods and services. Licensing fees are recognised as an expense when it is confirmed that they are payable by the Company. 1.f Summary of Significant Accounting Policies
q) Parent Information
continued
n) Employee Benefits
Wages, salaries and annual leave
Liabilities for wages and salaries, including non-
monetary benefits and annual leave payments
expected to be settled within 12 months of the
reporting date are recognised in other provisions in
respect of employees' service up to the reporting date.
They are measured at the amounts expected to be
paid when the liabilities are settled.
Long Service Leave
The liability for long service leave is recognised for
employee benefits and measured as the present value
of expected future payments to be made in respect
of services provided by employees up to the reporting
date. Consideration is given to expected future wage
and salary levels, experience of employee departures,
and periods of service. Expected future payments are
discounted using market yields at the reporting date
on national corporate bonds with terms to maturity
and currencies that match, as closely as possible, to
the estimated future cash outflows.
0) Contributed Equity
Ordinary shares are classified as equity. Any
transaction costs arising on the issue of ordinary
shares are recognised directly in equity as a reduction
(net of tax) of the share proceeds received.
p) Earnings Per Share
Basic earnings per share is calculated as net gain
attributable to members, adjusted to exclude costs of
servicing equity (other than dividends), divided by the
weighted average number of ordinary shares, adjusted
for any bonus element.
Diluted earnings per share is calculated as net gain
attributable to members, adjusted for:
• costs of servicing equity (other than dividends);
• the after tax effect of dividends and interest
associated with dilutive potential ordinary shares
that have been recognised as expenses;
• other non-discretionary changes in revenues or
expenses during the period that would result from
the dilution of potential ordinary shares; divided by
the weighted average number of ordinary shares
and dilutive potential ordinary shares, adjusted for
any bonus element.
The financial information for the parent entity,
Antisense Therapeutics Limited, disclosed in
Note 2 has been prepared on the same basis as
the consolidated statements with the exception of
investments in subsidiaries which are carried at costs
less any impairment.
39
ANNUAL REPORT 2018
Notes to the Financial Statements
For the year ended 30 June 2018
Note 2: Information Relating to the Antisense Therapeutics Limited (the Parent)
2018
$
2017
$
4,794,456
2,524,987
7,675
14,088
4,802,131
2,539,075
580,860
685,652
(580,860)
(685,652)
62,405,510
57,706,647
(58,184,239)
(55,853,224)
4,221,271
1,853,423
(2,331,015)
(2,754,799)
(2,331,015)
(2,754,799)
2018
$
-
25,553
25,553
272,424
272,424
297,977
2017
$
69,115
71,054
140,169
399,203
399,203
539,372
ASSETS
Current assets
Non-current assets
Total assets
LIABILITIES
Current liabilities
Total liabilities
EQUITY
Contributed equity
Retained earnings
Total equity
Net loss for the year
Total comprehensive loss of the Parent entity
Note 3: Revenue and Other Income
REVENUE
Licensing revenue
Interest from external parties
Total revenue
OTHER INCOME
Research and development tax concession
Total other income
Total revenue & other income
40
2018 ANNUAL REPORT Note 4: Expenses
Administrative Expenses
Compliance expenses
Office expenses
Corporate employee expenses
Other
Business development expenses
Total administrative expenses
Occupancy Expenses
Rent
Other expenses
Total occupancy expenses
Research and Development Expenses
ATL 1102
ATL 1103
R&D Staff Costs
Total Research and Development Expenses
Patent expenses
Depreciation expenses
Foreign exchange gains/(losses)
Total Expenses
2018
$
221,922
38,609
678,913
31,407
2017
$
273,571
50,849
764,360
596
343,098
765,771
1,313,949
1,855,147
100,999
13,063
114,062
333,020
420,606
221,777
98,777
21,018
119,795
567,182
386,700
150,084
975,403
1,103,966
210,316
202,924
6,413
8,849
4,890
7,449
2,628,992
3,294,171
41
ANNUAL REPORT 2018 Notes to the Financial Statements
For the year ended 30 June 2018
Note 5: Income Tax
Accounting loss before income tax
At Australia's statutory income tax rate of 27.5% (2017: 30%)
Research and development tax concession
Non-assessable grant income
Section 40-880 deductions
Entertainment
2018
$
2017
$
2,331,015
2,754,799
(641,029)
(826,439)
685,971
(81,727)
(39,377)
1,032
841,760
(119,761)
(22,920)
1,911
Tax (benefit)/losses not previously recognised
75,130
125,449
Income tax expense reported in the statement of profit or loss
Income tax attributable to a discontinued operation
Income tax expense/(benefit) attributable to the Company
Deferred Tax
Deferred tax assets and liabilities:
Accruals
Provision for annual leave & long service leave
Other
Net deferred tax asset/(liability) not recognised
Previously unbooked losses
Net deferred tax asset/(liability)
Tax Losses
-
-
-
(8,308)
(20,092)
1,569
(26,831)
26,831
-
-
-
-
22,910
8,776
(1,492)
30,194
-
-
Antisense Therapeutics Limited has unconfirmed, unrecouped tax losses in Australia which have not been brought to
account. The ability to be able to recognise a deferred tax asset in respect of these tax losses will be dependent upon
the probability that future taxable profit will be available against which the unused tax losses can be utilised and the
conditions for deductibility imposed by Australian tax authorities will be complied with.
Unused tax losses for which no deferred tax asset has been recognised
44,841,864
44,840,832
44,841,864
44,840,832
2018
$
2017
$
42
2018 ANNUAL REPORT Note 6: Key Management Personnel Compensation
The aggregate compensation made to Directors and other Key Management Personnel of the Company is set
out below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
2018
$
2017
$
908,956
878,894
57,184
11,197
49,162
11,197
977,337
939,253
For more information on Key Management Personnel Compensation, please refer to the Remuneration Report contained
under Directors’ Report.
Note 7: Auditors’ Remuneration
The auditor of Antisense Therapeutics Limited is Ernst and Young.
Amounts received or due and receivable by Ernst and Young for:
An audit or review of the financial report of the entity
50,985
50,985
2018
$
2017
$
Other services in relation to the entity:
Tax compliance services
Note 8: Earnings per share (EPS)
19,648
70,633
19,250
70,235
Basic EPS is calculated by dividing profit for the year attributable to ordinary equity holders of the Parent by the
weighted average number of ordinary shares outstanding during the year.
Diluted EPS is calculated by dividing the net profit attributable to ordinary equity holders of the Parent (after adjusting
for interest on the convertible preference shares) by the weighted average number of ordinary shares outstanding during
the year plus the weighted average number of ordinary shares that would be issued on conversion of all the dilutive
potential ordinary shares into ordinary shares.
The following table reflects the income and share data used in the basic and diluted EPS computations:
Net profit/(earnings/(losses)) used in the calculation of basic and diluted earnings/
(losses) per share
2018
$
2017
$
(2,331,015)
(2,754,799)
Weighted average number of ordinary shares for basic EPS
194,630,185
161,525,282
Adjustments for calculation of diluted earnings/(losses) per share:
Weighted average number of ordinary shares adjusted for the effect of dilution
194,630,185
161,525,282
There have been no other conversions to, call of, or subscriptions for ordinary shares, or issues of potential ordinary
shares since the reporting date and before the completion of this financial report.
43
ANNUAL REPORT 2018 Notes to the Financial Statements
For the year ended 30 June 2018
Note 9: Cash and Cash Equivalents
Cash at bank and on hand
Short-term deposits
2018
$
2017
$
399,059
401,988
1,500,000
1,500,000
1,899,059
1,901,988
The interest rate on cash at bank at 30 June 2018 was 0.10%p.a. (2017: 0.10% p.a.). And the interest rates on term
deposits at 30 June 2018 were 2.24% p.a. (2017: 1.84% p.a.) for 30 days, 2.30% p.a. (2017: 2.19%) for 90 days. The term
deposits have maturity periods of 30 days and 90 days.
Note 10: Trade and Other Receivables
Interest receivable
Research and development tax concession receivable
Other receivables
Note 11: Other Current Assets
Term deposit (greater than 3 months)
Other
2018
$
11,900
272,253
47,009
331,162
2018
$
2,400,000
-
2,400,000
2017
$
3,265
399,203
25,426
427,894
2017
$
-
30,000
30,000
The interest rates on term deposits at 30 June 2018 were , 2.42% for 120 days and 2.55% and 2.48% respectively for 180
days. The term deposits have maturity periods of 120 days and 180 days.
44
2018 ANNUAL REPORT Note 12: Property, Plant and Equipment
Property, plant & equipment
Cost
At 1 July 2016
Additions
At 30 June 2017
At 1 July 2017
At 30 June 2018
Depreciation and impairment
At 1 July 2016
Depreciation charge for the year
At 30 June 2017
At 1 July 2017
Depreciation charge for the year
At 30 June 2018
Gross value
Accumulated depreciation
Note 13: Trade and Other Payables
Trade payables
Accrued expenses
Other payables
Note 14: Employee Benefit Liabilities
Current employee provisions
$
176,070
15,575
191,645
191,645
191,645
(172,667)
(4,890)
(177,557)
(177,557)
(6,413)
(183,970)
2018
$
2017
$
191,645
191,645
(183,970)
(177,557)
7,675
14,088
2018
$
103,755
224,287
4,577
2017
$
165,694
194,075
4,577
332,619
364,346
2018
$
248,241
248,241
2017
$
321,306
321,306
45
ANNUAL REPORT 2018 Notes to the Financial Statements
For the year ended 30 June 2018
Note 15: Contributed Equity
Ordinary fully paid shares
Options over ordinary shares
Note 15(a): Ordinary Shares
Note
15(a)
15(b)
2018
$
2017
$
61,165,398
56,466,535
1,240,112
1,240,112
62,405,510
57,706,647
2018
No.
$
2017
No.
$
At the beginning of the period
161,559,408
56,466,535
161,487,408
55,505,680
Shares issued during the year
210,059,230
Transaction costs relating to share issues
-
5,043,213
(344,350)
72,000
960,855
-
-
Balance at the end of the year
371,618,638
61,165,398
161,559,408
56,466,535
Details of movement in shares:
2018
06 April 2018
Details
Numbers
Institutional Placement to Australian
Ethical Investment
24,233,911
07 May 2018
Non-Renounceable Entitlement Issue
181,045,377
09 May 2018
Non-Renounceable Entitlement Issue
4,747,942
28 June 2018
Conversion of Options (ANPOB)
32,000
210,059,230
2017
Details
Numbers
30 June 2017
Shares issued during the period
72,000
72,000
Issue Price
$
0.024
0.024
0.024
0.08
AUD
$
581,614
4,345,089
113,950
2,560
5,043,213
Issue Price
AUD
$
-
$
-
-
Ordinary shares participate in dividends and the proceeds on winding up of the Company in proportion to the number
of shares held. At shareholder meetings each ordinary share is entitled to one vote when a poll is called, otherwise each
shareholder has one vote on a show of hands. The ordinary shares have no par value.
46
2018 ANNUAL REPORT Note 15(b): Options
Reconciliation of option movement in the period:
2018
No.
$
2017
No.
$
At the beginning of the period
68,713,794
1,240,112
46,950,984
1,209,045
Options issued during the period
Options exercised during the period
Capital raising costs associated with
options issues
Options expired during the period
-
(32,000)
-
-
-
-
-
-
68,713,794
-
-
73,169
-
(42,102)
(46,950,984)
-
68,681,794
1,240,112
68,713,794
1,240,112
Note 16: Reserves
Nature and Purpose of the Reserve
The option reserve recognises the proceeds from the issue of options over ordinary shares and the expense recognised
in respect of share based payments.
Unlisted options over fully paid shares
2018
No.
-
$
-
2017
No.
-
$
-
During the year ended 30 June 2018 32,000 options have been exercised. There was no activity during the year ended
30 June 2017.
Options Outstanding as at 30 June 2018:
On issue at beginning of year
Issued during the year
Exercised during the year
Expired during the year
Forfeited during the year
No. of Options
20 Dec 2016
68,713,794
-
(32,000)
-
-
Outstanding at balance sheet date
68,681,794
Expired subsequent to balance date
Exercised subsequent to balance date
-
-
Outstanding at date of Directors’
Report
Original number of recipients
Number of current holders
Exercise price
Exercise period from
To (expiration day)
No. of Options
-
1,529
1,529
$0.08
20 Dec 2016
19 Dec 2019
The following proportion of options
vest from the dates shown:
100%
19 Dec 2019
47
ANNUAL REPORT 2018 Notes to the Financial Statements
For the year ended 30 June 2018
Note 17: Commitments and Contingencies
Operating Lease Commitments
Future minimum rentals payable under non-cancellable operating leases as at 30 June are, as follows:
Within one year
2018
$
27,000
27,000
2017
$
24,693
24,693
The lease expenditure commitments relate to the leasing of office premises. The lease is for a term of one year, expiring
October 2018.
There are no contingencies in the current or preceding year.
Note 18: Operating Segments
The Company has identified its operating segments based on the internal reports that are reviewed and used by the
management team in assessing performance and determining allocation of the resources.
The operating segments are identified by management based on the manner in which the expenses are incurred, and for
the purpose of making decisions about resource allocation and performance assessment.
Discrete financial information about each of these operating segments is reported by the executive management team to
the board on a regular basis.
For the management purposes, the Company prepares its reporting for the following two operating segments that has
been identified based on its antisense oligonucleotide products that are currently under development:
• ATL1102; and
• ATL1103
All revenue and expenses that do not directly relate to these two operating segments have been currently reported as
unallocated.
30 June 2018
ATL1102
ATL1103
Segment revenue
Segment result
Net result
$
-
(96,349)
(96,349)
Unallocated
(Note a)
$
25,553
Total
$
297,977
$
272,424
(385,024)
(2,147,619)
(2,628,992)
(112,600)
(2,122,066)
(2,331,015)
30 June 2017
ATL1102
ATL1103
Segment revenue
Segment result
Net result
48
$
-
(285,679)
(285,679)
$
69,115
(269,000)
(199,885)
Unallocated
(Note a)
$
71,054
Total
$
140,169
(2,340,289)
(2,894,968)
(2,269,235)
(2,754,799)
2018 ANNUAL REPORT Note 18(a): Unallocated breakdown
Unallocated revenue
Interest from external parties
Unallocated result
Compliance expenses
Business development expenses
Employee expenses
Patent expenses
Other expenses
Note 19: Cash Flow Information
Reconciliation of cash flow from operations with loss after income tax
2018
$
25,553
25,553
(221,922)
(343,098)
(900,690)
(210,316)
(471,593)
2017
$
71,054
71,054
(273,571)
(765,771)
(764,360)
(202,924)
(333,663)
(2,147,619)
(2,340,289)
2018
$
2017
$
Cash flow reconciliation
Reconciliation of net loss after tax to net cash flows from operations:
Net loss before tax
(2,331,015)
(2,754,799)
Adjustments to reconcile loss before tax to net cash flows:
Depreciation expense
Working capital adjustments:
Movement in trade and other receivables
Movement in prepayments
Movement in trade and other payables
Movement in other current assets
Movement in provisions
6,413
4,890
96,740
870
(31,736)
30,000
(73,065)
(7,597)
(62,164)
(93,808)
(30,000)
29,256
Net cash flows used in operating activities
(2,301,793)
(2,914,222)
Note 20: Events After the Reporting Period
There have not been any matters or circumstances, other than that referred to in the financial statements or notes
thereto, that have arisen since the end of the financial year, which significantly affected, or may significantly affect,
the operations of Antisense Therapeutics Limited, the results of those operations or the state of affairs of Antisense
Therapeutics Limited in future financial years.
49
ANNUAL REPORT 2018 Notes to the Financial Statements
For the year ended 30 June 2018
Note 21: Related Party Transactions
The following are identified as Key Management Personnel for the year:
• Mr Robert W Moses
• Mr Mark Diamond
• DrGraham Mitchell
• Mr William Goolsbee
• Dr Gary Pace
• Dr George Tachas
• Mr Phillip Hains
There were no other transactions with related parties during the current financial year other than those declared on the
Remuneration Report.
Note 22: Financial Risk Management Objectives and Policies
Note 22(a): Financial Instruments
The Company's financial instruments consist of cash and cash equivalents, trade and other receivables and trade and
other payables:
Cash and cash equivalents
Other current assets
Trade and other receivables
Trade and other payables
2018
$
2017
$
1,899,059
1,901,988
2,400,000
331,162
30,000
427,894
(332,619)
(364,346)
The Company does not have any derivative instruments at 30 June 2018 (2017: Nil).
Note 22(b): Risk Management Policy
The Board is responsible for overseeing the establishment and implementation of the risk management system, and
reviews and assesses the effectiveness of the Company's implementation of that system on a regular basis.
The Board and Senior Management identify the general areas of risk and their impact on the activities of the Company,
with Management performing a regular review of:
• the major risks that occur within the business;
• the degree of risk involved;
• the current approach to managing the risk; and
•
if appropriate, determine:
(i) any inadequacies of the current approach; and
(ii) possible new approaches that more efficiently and effectively address the risk.
Management report risks identified to the Board through the Operations Report at Board Meetings and periodically via
direct communication as relevant risks are identified.
The Company seeks to ensure that its exposure to undue risk which is likely to impact its financial performance,
continued growth and survival is minimised in a cost effective manner.
50
2018 ANNUAL REPORT Note 22(c): Significant Accounting Policy
Details of significant accounting policies and methods adopted, including the criteria for recognition, the basis for
measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset,
financial liability and equity instrument are disclosed in Note 1 to the financial statements.
The carrying amounts of cash and cash equivalents, trade and other receivables and trade and other payables are
determined in accordance with the accounting policies disclosed in Note 1.
Interest revenue on cash and cash equivalents and foreign exchange movements on trade and other receivables and
trade and other payables are disclosed in Notes 3 and 4.
Note 22(d): Capital Risk Management
The Company's objectives when managing capital are to safeguard the Company's ability to continue as a going concern
and to maintain an optimal capital structure so as to maximise shareholder value. In order to maintain or achieve an
optimal capital structure, the Company may issue new shares or reduce its capital, subject to the provisions of the
Company's constitution.
The capital structure of the Company consists of equity attributed to equity holders of the Company, comprising
contributed equity, reserves and accumulated losses disclosed in Notes 15 and 16. By monitoring undiscounted cash flow
forecasts and actual cash flows provided to the Board by the Company's Management the Board monitors the need to
raise additional equity from the equity markets.
Note 22(e): Financial Risk Management
The main risks the Company is exposed to through its operations are interest rate risk, foreign exchange risk, credit risk
and liquidity risk.
Interest Rate Risk
The Company is exposed to interest rate risks via the cash and cash equivalents that it holds. Interest rate risk is the risk that
a financial instruments value will fluctuate as a result of changes in market interest rates. The objective of managing interest
rate risk is to minimise the Company's exposure to fluctuations in interest rate that might impact its interest revenue and
cash flow.
To manage interest rate risk, the Company locks a portion of the Company's cash and cash equivalents into term deposits.
The maturity of term deposits is determined based on the Company's cash flow forecast.
Interest rate risk is considered when placing funds on term deposits. The Company considers the reduced interest rate
received by retaining cash and cash equivalents in the Company's operating account compared to placing funds into a term
deposit. This consideration also takes into account the costs associated with breaking a term deposit should early access to
cash and cash equivalents be required.
The Company's exposure to interest rate risk and the weighted average interest rates on the Company's financial assets and
financial liabilities is as follows:
51
ANNUAL REPORT 2018 Notes to the Financial Statements
For the year ended 30 June 2018
Note 22(e): Financial Risk Management continued
Interest Rate Risk continued
Weighted
Average
Effective
Interest
Rate
Floating
Interest
Rate
Fixed
Interest
Rate
within
Year
Fixed
Interest
Rate 1 to 5
Years
Fixed
Interest
Rate over
5 Years
%
$
$
Cash & cash equivalents
2.00
398,659
1,500,000
Other Current Assets
Trade & other receivables
Financial Liabilities
-
-
- 2,400,000
-
-
2.00
398,659 3,900,000
Trade & other payables
-
-
-
Weighted
Average
Effective
Interest
Rate
Floating
Interest
Rate
Fixed
Interest
Rate
within
Year
Fixed
Interest
Rate 1 to 5
Years
Fixed
Interest
Rate over
5 Years
%
$
$
30 June 2018
Financial Assets
30 June 2017
Financial Assets
Cash & cash equivalents
2.02
401,588
1,500,000
Trade & other receivables
-
-
-
2.02
401,588 1,500,000
Financial Liabilities
Trade & other payables
-
-
-
Non-
Interest
Bearing
$
Total
$
400
1,899,059
- 2,400,000
331,154
331,154
331,554 4,630,213
332,619
332,619
Non-
Interest
Bearing
$
Total
$
400
1,901,988
427,894
427,894
428,294 2,329,882
364,346
364,346
$
-
-
-
-
-
$
-
-
-
-
-
$
-
-
-
-
$
-
-
-
-
There has been no change to the Company's exposure to interest rate risk or the manner in which it manages and
measures its risk in the year ended 30 June 2018.
The Company has conducted a sensitivity analysis of the Company's exposure to interest rate risk. The percentage
change is based on the expected volatility of interest rates using market data and analysts forecasts. The analysis shows
that if the Company's interest rate was to fluctuate as disclosed below and all other variables had remained constant,
then the interest rate sensitivity impact on the Company's profit after tax and equity would be as follows:
2018: +1% (2017: +1%)
2018: -1% (2017: -1%)
52
(Higher) / Lower
(Higher) / Lower
2018
42,991
(42,991)
2017
19,020
(19,020)
2018 ANNUAL REPORT
Foreign Currency Risk
The Company is exposed to foreign currency risk via the trade and other receivables and trade and other payables that
it holds. Foreign currency risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign
exchange rates. The Company aims to take a conservative position in relation to foreign currency risk hedging when
budgeting for overseas expenditure however; the Company does not have a policy to hedge overseas payments or
receivables as they are highly variable in amount and timing, due to the reliance on activities carried out by overseas entities
and their billing cycle.
The following financial assets and liabilities are subject to foreign currency risk:
Trade and other payables (AUD/USD)
Trade and other payables (AUD/GBP)
Trade and other payables (AUD/EUR)
2018
$
2017
$
22,645
(21,193)
1
943
3,894
1,115
Foreign currency risk is measured by regular review of our cash forecasts, monitoring the dollar amount and currencies
that payment are anticipated to be paid in. The Company also considers the market fluctuations in relevant currencies to
determine the level of exposure. If the level of exposure is considered by Management to be too high, then Management
has authority to take steps to reduce the risk.
Steps to reduce risk may include the acquisition of foreign currency ahead of the anticipated due date of an invoice or
may include negotiations with suppliers to make payment in our functional currency. Management mitigated foreign
currency risk by purchasing Great British Pounds currency during the current financial year. Should Management
determine that the Company should consider taking out a hedge to reduce the foreign currency risk, they would need to
seek Board approval.
The Company conducts some activities outside of Australia which exposes it to transactional currency movements,
where the Company is required to pay in a currency other than its functional currency.
There has been no change in the manner the Company manages and measures its risk in the Year Ended 30 June 2018.
The Company is exposed to fluctuations in United States dollars, Euros, and Great British Pounds. Analysis is conducted
on a currency by currency basis using sensitivity variables.
The Company has conducted a sensitivity analysis of the Company's exposure to foreign currency risk. The sensitivity
analysis variable is based on the expected overall volatility of the significant currencies, which is based on management’s
assessment of reasonable possible fluctuations taking into consideration movements over the last 6 months each year
and the spot rates at each reporting date. The analysis shows that if the Company's exposure to foreign currency risk was
to fluctuate as disclosed below and all other variables had remained constant, then the foreign currency sensitivity impact
on the Company's loss after tax and equity would be as follows:
(Higher) / Lower
(Higher) / Lower
AUD/USD: 2018: +3% (2017: +3%)
AUD/USD: 2018: -3% (2017: -3%)
AUD/GBP: 2018: +3% (2017: +3%)
AUD/GBP: 2018: -3% (2017: -3%)
AUD/EUR: 2018: +3% (2017: +3%)
AUD/EUR: 2018: -3% (2017: -3%)
2018
679
(679)
-
-
8
(8)
2017
636
(636)
117
(117)
33
(33)
53
ANNUAL REPORT 2018 Notes to the Financial Statements
For the year ended 30 June 2018
Note 22(e): Financial Risk Management continued
Credit Risk
The Company is exposed to credit risk via its cash and cash equivalents and trade and other receivables. Credit risk is the
risk that a counter-party will default on its contractual obligations resulting in a financial loss to the Company. To reduce
risk exposure for the Company's cash and cash equivalents and other receivables, it places them with high credit quality
financial institutions.
Historically the Company has had minimal trade and other receivables, with the majority of its funding being provided
via shareholder investment. Traditionally the Company's trade and other receivables relate to GST refunds and Research
and Development Tax Concession amounts due to the Company from the Australian Tax Office. At 30 June 2018 GST
accounted for $3,434 (2017: $7,468) of the trade and other receivables, respectively. At 30 June 2018, accrued interest
from the Commonwealth Bank amounted to $11,900 (2017: $3,265).
The trade and other receivables at 90+ days also include the rent bond on the office premises of $8,231. This is not
considered impaired. The Board believes that the Company does not have significant credit risk at this time in respect of
its trade and other receivables.
The Company has analysed its trade and other receivables below. All trade and other receivables disclosed below have
not been impaired.
2018 Trade and other receivables
2017 Trade and other receivables
Liquidity Risk
0-30 days
31-60 days
61-90 days
90+ days
$
331,162
427,894
$
-
-
$
-
-
$
-
-
The Company is exposed to liquidity risk via its trade and other payables. Liquidity risk is the risk that the Company will
encounter difficulty in raising funds to meet the commitments associated with its financial instruments. Responsibility for
liquidity risk rests with the Board who manage liquidity risk by monitoring undiscounted cash flow forecasts and actual
cash flows provided to them by the Company's Management at Board meetings to ensure that the Company continues to
be able to meet its debts as and when they fall due. Contracts are not entered into unless the Board believes that there
is sufficient cash flow to fund the associated commitments. The Board considers when reviewing its undiscounted cash
flow forecasts whether the Company needs to raise additional funding from the equity markets.
The Company has analysed its trade and other payables below:
2018 Trade and other payables
2017 Trade and other payables
0-30 days
31-60 days
61-90 days
90+ days
$
332,619
364,346
$
-
-
$
-
-
$
-
-
54
2018 ANNUAL REPORT
Note 23: Company Information
Information about subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy:
Name
Principal Activities
Country of incorporation
Antisense Therapeutics (HK) Pty Ltd
Provision of licenses
Australia
% Equity interest
2017
100
2018
100
Directors' Declaration
In accordance with a resolution of the Directors of Antisense Therapeutics Limited, we state that:
1.
In the opinion of the Directors:
(a) the consolidated financial statements and notes of Antisense Therapeutics Limited for the financial Year Ended
30 June 2018 are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity's financial position as at 30 June 2018 and of its
performance for the Year Ended on that date; and
(ii) complying with Accounting Standards and the Corporations Regulations 2001;
(b) the consolidated financial statements and notes also comply with International Financial Reporting Standards as
disclosed in Note 1.c; and
(c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
2. This declaration has been made after receiving the declarations required to be made to the Directors by the chief
executive officer and chief financial officer in accordance with section 295A of the Corporations Act 2001 for the
financial Year Ended 30 June 2018.
On behalf of the board,
Signed in accordance with a resolution of the Directors.
Mr Robert W Moses
Independent Non-Executive Chairman
Mr Mark Diamond
Managing Directer and Chief Executive Officer
Dated: This day 29th day of August 2018
55
ANNUAL REPORT 2018 Independent Auditor's Report
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com
Independent auditor’s report to the members of Antisense
Therapeutics Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Antisense Therapeutics Limited (the Company) and its subsidiaries
(collectively the Group), which comprises the consolidated statement of financial position as at 30 June
2018, the consolidated statement of comprehensive income, consolidated statement of changes in equity
and consolidated statement of cash flows for the year then ended, notes to the 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 consolidated financial position of the Group as at 30 June 2018 and
of its financial 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 (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.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
opinion on these matters. For each matter below, our description of how our audit addressed the matter
is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
56
2018 ANNUAL REPORT 1. Going Concern
Why significant
As disclosed in Note 1(b) of the financial report the
Directors concluded that in their opinion, despite the
Group continuing to generate operating losses there
are reasonable grounds to believe that the Group has
the ability to pay its debts as and when they fall due.
The financial report has been prepared on a going
concern basis.
The going concern assumption is fundamental to the
basis of preparation of the financial report. Given the
judgment involved in the preparation of cash flow
forecasts to support the going concern conclusion,
this was considered a Key Audit Matter.
2. Research & Development tax benefit
How our audit addressed the key audit matter
Our procedures included the following:
Evaluated the assumptions in the cash flow
forecasts as approved by the Board, including
assumptions with respect to timing and
magnitude of cash flows.
Assessed the consistency of the assumptions
included in the cash flow model with
statements related to future plans and
commitments contained in board minutes and
the directors report.
Considered the historical accuracy of the
Group’s cash flow forecasting by reference to
actual results in prior periods compared to the
cash flow forecasts.
Assessed the adequacy of the going concern
disclosures contained in Note 1(b).
Why significant
How our audit addressed the key audit matter
Our procedures included the following:
Evaluated the methodology and assumptions
used by the Group in calculating the R&D
income tax credit claim receivable with
reference to the applicable legislation and in
conjunction with our R&D taxation specialists.
Tested the mathematical accuracy of the
Group’s calculations.
Compared historical estimates against the
actual claims received in prior years.
Under the Australian Government’s Research &
Development (“R&D”) income tax credit regime, the
Group is entitled to an R&D credit on eligible R&D
expenditure incurred, including the decline in value
of depreciating assets used in eligible R&D activities.
The Group has estimated the R&D credit for the year
ended 30 June 2018 and recognised the amount
receivable under the scheme upon filing their
claim along with the lodgement of their tax return.
The estimated amount of $272,424 is recorded
as Other income in the Consolidated Statement
of Comprehensive Income and a receivable in the
Consolidated Statement of Financial Position.
The Group’s policy for accounting for this income and
the receivable are disclosed in Note 1.
This was considered a key audit matter due to
the quantum of the receivable recorded and the
judgment associated with applying the relevant
income tax legislation.
57
ANNUAL REPORT 2018 Independent Auditor's Report continued
Information Other than the Financial Report and Auditor’s Report
The directors are responsible for the other information. The other information comprises the
information included in the Company’s 2018 Annual Report, but does not include the financial report
and our auditor’s report thereon, with the exception of the Remuneration Report and our related
assurance opinion.
Our opinion on the financial report does not cover the other information and accordingly 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 relating 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
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.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
58
2018 ANNUAL REPORT • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions
that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude
that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However,
future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events in a
manner that achieves fair presentation.
We communicate with the directors regarding, among other matters, the planned scope and timing of
the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Report on the Audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 14 to 19 of the directors' report for the year
ended 30 June 2018.
In our opinion, the Remuneration Report of Antisense Therapeutics Limited for the year ended 30 June
2018, 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.
Ernst & Young
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Joanne Lonergan
Partner Melbourne
29 August 2018
59
ANNUAL REPORT 2018 Shareholder Information
As at 17 September 2018
Number of Holders of Equity Securities
Ordinary Shares
Distribution of Quoted Security holders
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 +
Total number of
shareholders
Unmarketable
parcels
(under $500)
371,618,638 fully paid ordinary shares are held by 1,484
individual shareholders.
All ordinary shares carry one vote per share.
Options
68,681,794 options exercisable at $0.08 on or before 19
December 2019, are held by 1,388 individual holders.
Options do not carry a right to vote. Voting rights will be
attached to the unissued shares when the options have
been exercised.
Twenty Largest Ordinary Shareholders
Shareholders
1
2
3
4
5
NATIONAL NOMINEES LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
OPTHEA LIMITED
CITYCASTLE PTY LTD
CITICORP NOMINEES PTY LIMITED
6 MR ROBERT WILLIAM MOSES
7 MR GLEN BULL
8
9
10
11
12
13
SHARED OFFICE SERVICES PTY LTD
SCINTILLA STRATEGIC INVESTMENTS LIMITED
SKED PTY LTD
STATEMOOR PTY LTD
CITYCASTLE PTY LTD
GRANET SUPERANNUATION AND INVESTMENT SERVICES PL
14 MR LESLIE SMITH
15 MR DAVID KENLEY
16 MR JAN MARACH & MRS RENATA MARACH
17 MR MARK DIAMOND
18
19
BNP PARIBAS NOMINEES PTY LTD
TAPP FAMILY INVESTMENTS PTY LTD
20 BAYSPEC PTY LTD
Total
Total balance of remaining holders
No. of Holders
Ordinary Shares
Listed Options
105
137
115
766
361
1,484
640
Number
70,833,333
21,906,913
10,190,649
8,160,866
7,632,869
7,000,000
5,900,000
5,136,426
5,000,000
4,839,792
4,500,000
4,171,611
4,166,667
4,100,000
4,000,000
3,893,030
3,442,144
3,367,488
3,000,000
2,900,000
236
485
235
352
80
1,388
1,282
%
19.06%
5.89%
2.74%
2.20%
2.05%
1.88%
1.59%
1.38%
1.35%
1.30%
1.21%
1.12%
1.12%
1.10%
1.08%
1.05%
0.93%
0.91%
0.81%
0.78%
184,141,788
187,476,850
49.55%
50.45%
60
2018 ANNUAL REPORT
Twenty Largest Listed Option Holders
Option holders
1
XCELERATE TRADING PTY LTD
2 MS LEE GARDINER
3 MR JAN MARACH & MRS RENATA MARACH
4 MR LESLIE SMITH
5. MR RICHARD HUGO HAMERSLEY
6 MR DAVID BOUDVILLE
7
8
9
KIRZY PTY LTD
CITYCASTLE PTY LTD
OPTHEA LIMITED
10 MR ANDREW LEONARD CLARK
11 MR ROBERT WILLIAM MOSES
12 GOFFACAN PTY LTD
13
14
15
16
17
18
CITICORP NOMINEES PTY LIMITED
BROKEN RIDGE PTY LTD
PEJAY PTY LIMITED
SHARED OFFICE SERVICES PTY LTD
BAYSPEC PTY LTD
ARMDIG PTY LTD
19 MR SINI MATHEW
20 BNP PARIBAS NOMINEES PTY LTD
Total
Total balance of remaining holders
Unquoted Equity Securities Holdings Greater Than 20%
Nil
Substantial Shareholders
Number
5,258,773
4,397,803
4,322,050
2,922,651
2,486,087
2,393,992
2,155,000
2,132,754
2,038,130
1,583,600
1,418,888
1,364,000
1,288,005
1,080,000
1,057,067
804,176
800,000
770,000
720,236
656,398
39,649,610
29,032,184
%
7.66%
6.40%
6.29%
4.25%
3.62%
3.49%
3.14%
3.11%
2.97%
2.31%
2.07%
1.98%
1.87%
1.57%
1.54%
1.17%
1.16%
1.12%
1.05%
0.96%
57.73%
42.27%
The names of substantial shareholders the Company is aware of from the register or who have notified the
Company in accordance with Section 671B of the Corporations Act are:
NATIONAL NOMINEES LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
No. of Shares
70,833,333
21,906,913
61
ANNUAL REPORT 2018
Corporate Information
ABN 41 095 060 745
DIRECTORS
SOLICITORS
Minter Ellison
Rialto Towers
Level 23, 525 Collins Street, Melbourne Victoria 3000
Australia
BANKERS
Commonwealth Bank of Australia
Melbourne Victoria
AUDITORS
Ernst and Young
8 Exhibition Street, Melbourne Victoria 3000
Australia
WEBSITE
www.antisense.com.au
Mr Robert W Moses
Independent Non-Executive
Chairman
(Appointed: 23 October 2001)
Mr Mark Diamond
Managing Director
(Appointed: 31 October 2001)
Dr Graham Mitchell
Independent Non-Executive
Director
(Appointed: 24 October 2001)
Dr Gary Pace
Independent Non-Executive
Director
(Appointed: 9 November 2015)
Mr William Goolsbee
Independent Non-Executive
Director
(Appointed: 15 October 2015)
COMPANY SECRETARY
Mr Phillip Hains
Company Secretary and
Chief Financial Officer
REGISTERED OFFICE
6-8 Wallace Avenue, Toorak Victoria 3142
Australia
Telephone:
+61 (0)3 9827 8999
PRINCIPAL PLACE OF BUSINESS
6-8 Wallace Avenue, Toorak Victoria 3142
Australia
Telephone:
Facsimile:
+61 (0)3 9827 8999
+61 (0)3 9827 1166
SHARE REGISTER
Boardroom Pty Ltd
Level 12, 225 George Street, Sydney NSW 2000
Australia
Telephone:
1300 737 760
Antisense Therapeutics Limited shares are listed on the
Australian Stock Exchange (ASX)
62
2018 ANNUAL REPORT
THIS PAGE IS INTENTIONALLY BLANK.
63
ANNUAL REPORT 2018 6-8 Wallace Avenue,
Toorak Victoria 3142
Australia
T: + 61 (0)3 9827 8999
F: + 61 (0)3 9827 1166
Annual Report 2018