Annual
Report
2022
ATO MO D IAGNOSTICS L I MITE D
AC N 14 2 925 684
ATOMODIAGNOSTICS.COM
ATOMO ANNUAL REPORT FY22
CON TE NTS
01 FY22 AT A GLANCE
02 CHAIRMAN’S LETTER
03 CEO REPORT
04 KEY ACHIEVEMENTS AND CHALLENGES FY22
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3
5
7
05 DELIVERING ON OUR STRATEGY WITH UNIQUE TECHNOLOGY AND KNOWLEDGE 8
‘We are a global company.
From our research, development
and corporate office in Sydney,
Australia; with production
capabilities in the U.S.A. and
manufacture and distribution
in South Africa – we are Atomo.’
Atomo Corporate Video 2022
06 WHAT WE VALUE, HOW WE CONTRIBUTE
07 STRATEGY FOR FY23 AND BEYOND
08 DIRECTORS’ REPORT
09 FINANCIAL STATEMENTS
Statement of Profit or Loss and Other Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
10 NOTES TO FINANCIAL STATEMENTS
11 DIRECTORS’ DECLARATION
12 INDEPENDENT AUDITOR'S REPORT
13 SHAREHOLDER INFORMATION
14 CORPORATE DIRECTORY
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13
16
38
41
42
43
44
45
78
80
84
88
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ATOMO ANNUAL REPORT FY22
01 FY22 AT A GLANCE
COM PANY PERFORMANCE Y E AR O N YE AR
)
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"
The growing
popularity of rapid
testing reflects
people exercising
a greater level of
cont rol over their
health. Self-testing
allows individuals
to acc urately
assess and act,
based on their
condi tion.
REVENUE FR OM CUSTOM ER S
For the FY22 $14.0m For the FY21 $6.7m Increase of 108%
REVENUE GROWTH DRIVER S
Increased sales of
COVID-19 rapid tests =
$10.4m in revenue, more
than 1 million tests sold
in Australia
Increased sales of HIV
products = more than half
a million tests sold and
revenue of $1.8m
REVENUE
GROWTH
DRIVERS
Revenue from licence
and settlement fees with
customer Access Bio of
$1.65m
A further $120k in
customer revenues
IN STALLED P RODUCTION CAPAC IT Y
Now at
18 million
devices per year
02 CHAIRMAN’S LETTER
Dear Shareholders,
1. Infectious disease testing
I write to you as we see signs of the COVID-19
pandemic easing and realise the benefits of
the widespread adoption of rapid testing. The
community’s everyday experiences of the
pandemic include the widespread adoption of
rapid testing in the workplace and at home, in
addition to established clinical settings. The
benefits of frequent and convenient screening
relieve demands on centralised testing resources.
The growing popularity of rapid testing reflects
people exercising a greater level of control over
their health. Self-testing allows individuals to
accurately assess and act, based on their condition.
It is against this transformed landscape that I am
pleased to introduce Atomo Diagnostics’ Annual
Report for the 2022 Financial Year.
OUR BUSINESS
Atomo supplies devices and screening tests for
the rapid testing of medical conditions by
professional users and consumers, detecting
infectious diseases and chronic health conditions
and assessing consumer wellness. Atomo
participates in three markets in the development
and commercialisation of diagnostic devices:
Atomo develops, commercialises and sells
finished products such as Atomo’s HIV Tests.
Atomo contracted with US partner Access Bio
to secure supplies of COVID-19 rapid antigen
tests, delivered into Australian markets as
Atomo COVID-19 rapid antigen tests.
2. OEM+ devices
Atomo partners in the development and supply
of our products for use in our partners’ rapid tests.
The extent of our involvement in this process sees
us describe the Original Equipment Manufacturer
activity as OEM+. Tests include NG Biotech’s
pregnancy test and Lumos Diagnostics’ FebriDx
test, which identifies whether a condition is caused
by a viral or bacterial infection. Atomo also supplies
devices to both NG Biotech and Access Bio for their
blood-based rapid antibody tests for the European
and US markets respectively.
3. Consumer health and wellness
Responding to decentralising health services,
Atomo’s user-centric designed devices allow
end users timely and accurate rapid test results.
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ATOMO ANNUAL REPORT FY22
The accelerated adoption of rapid testing for
COVID-19 is viewed as a watershed moment in
the decentralisation of screening diagnostics and
its acceptance by regulators and public health
authorities. We see this in the continued popularity
and adoption of telehealth consultations and
corresponding validation by health authorities,
insurers, and clinicians.
In late 2021, we welcomed the TGA relieving
restrictions on the sale of HIV self-tests,
announcing in June 2022 that Atomo would
partner with the Pharmacy Guild to develop
education in HIV self-testing.
During the year, we announced a material
extension to our diagnostics products. We started
developing swab and saliva devices to add to
our existing portfolio of blood-based lateral flow
devices, significantly expanding the addressable
market in which Atomo can participate. Atomo’s
swab device reflects our user-centric approach
while incorporating the use of our blister to
affect controlled solution delivery and utilise
existing IP.
OUR CAPABILITIES AND
REGULATORY APPROVALS
We responded to the immediate requirements
to serve the public health needs arising from
the COVID-19 pandemic. We also continued
growing our production capability and product
development, seeking out regulatory and other
requisite approvals.
OUR PEOPLE
The people who make up Atomo – its executives,
management, Board and our team – work tirelessly
on the opportunities for rapid diagnostic testing
that have become ever more apparent through
the pandemic.
Reflecting this growth, we are delighted to
welcome San Diego-based Jim McMenamy as
Head of Business Development and Partnerships,
and London-based Anna Tucker as Vice President,
Development – Europe, the Middle East and Africa.
We celebrated Chandra Sukumar’s promotion
to COO after four years with the company, an
appointment that involved an extensive external
and internal search. We thanked UK-based Mark
Smith as he retired as our longstanding COO.
We are also thrilled to have Palo Alto-based
Deborah Neff join the Atomo Board as an
Independent Non-Executive Director. Deborah’s
contribution to the Board draws from her extensive
executive responsibilities in healthcare and life
sciences. Deborah chairs our People, Culture and
Remuneration Committee among other roles. We
thanked Connie Carnabuci as she retired from the
Board.
John Kelly, CEO, and Will Souter, CFO, have
led with care and acumen throughout the year,
navigating conditions that have offered changing
opportunities and different risks. On behalf of
shareholders, the Board warmly recognises these
considerable efforts.
Atomo continues to deliver on its objective to be
a global leader in rapid diagnostics. The adoption
of rapid diagnostics during the pandemic has
changed users’ behaviours and expectations of
testing. Atomo will continue to meet such demand.
We welcome your continuing support and hope
that you share in our excitement.
John Keith
Chair, Atomo Board
"
Beyon d exi st in g
c han n els , Atomo
re main s foc u sed
on i n cre ase d
en gagem en t
wi t h th e broader
di agnost i c
mar ket an d on
rai si n g awaren ess
arou n d Atom o’s
u ni qu e sol ut i on s ,
es pec i al l y i n t he
US mar ket ...
03 CEO REPORT
Atomo has, through the course of FY22, strived
to balance two, at times resource competitive,
objectives. On the one hand, there was a clear
focus on near-term revenue generation through
participation in the rapidly emerging COVID-19 test
market. On the other, continuing to establish the
company’s unique, integrated, user-friendly testing
platforms as preferred solutions in the global point-
of-care test market.
This enabled the company to generate $14 million
in revenue from customers, more than doubling
revenue when compared to the prior period. And,
importantly, providing a strong balance sheet as
the company increasingly switches to commercial
activities, particularly in the US.
Further, a continued focus on delivering the core
value proposition of better blood-based testing has
increased engagement with the diagnostics market
as it began its transition out of a COVID-19 pandemic
mindset and into the vastly changed acceptance of
home-based testing.
Early in the pandemic we also recognised the
need to expand Atomo’s range of products beyond
blood-based testing. Our aim was to include swab
and saliva-based solutions, and we have spent the
last twelve months developing an integrated swab
test device with the aim of improving workflow
and test performance in swab-based testing. Proof
of concept has been completed, with preliminary
usability and performance evaluations carried out
in Q4 FY21 suggesting that the swab device meets its
goals. Initial market feedback on this product, when
presented recently at a major US trade conference,
was encouraging.
Atomo has also completed the build of its
proprietary second-generation automated blister
production system; and that equipment is currently
being qualified in Sydney. This will give the company
the ability to manufacture up to 16 million blister
components and support commercial scale-up of
both blood and swab-based products.
With the completion of most of the planned capital
investment in production capacity, plant, and
equipment there is now a shift of focus and spending
towards commercial scale-up. This has included
the establishment of a US subsidiary to support
US market engagement and, as mentioned in the
Chairman’s letter, the recruitment of several senior
commercial resources in the US and Europe. This
has enabled Atomo to exhibit at several recent
conferences and raise awareness of the company
and its unique product offerings. It has been pleasing
that many US-based attendees have now seen
first-hand the benefits of Atomo after several years
of cancelled industry events and the inability of our
management team to leave Australia.
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The point-of-care market is now undergoing
structural transformation as a result of the COVID-19
pandemic, with the rapid emergence of telehealth-
supported healthcare, broad acceptance of home
testing by the public and reduced clinical and
regulatory barriers to expansion. The scale of this
emerging opportunity, combined with reduced
barriers to adoption, has seen the recent entry of
large commercial players, including Amazon, to
the sector. Additionally, there has been increased
activity by established healthcare retailers looking
to adapt to this new healthcare model where
patients increasingly take more responsibility for
their own healthcare and are demanding greater
levels of access and convenience.
Atomo believes that the increased focus on
decentralised testing channels, particularly
pharmacy and home-based testing, enlarges the
addressable market for our consumer-focused
solutions. We have been encouraged by the interest
shown in our product solutions by both established
diagnostic companies and emerging eHeath
providers during FY22.
We are also pleased to report on the continued
improvement in our financial performance, detailed
in this report. In FY22, customer revenues increased
by 108% to $14.0m, with cash receipts from sales to
customers for the year totalling $16.4m. Revenue
growth was driven primarily by COVID-19-related
product sales, with more than one million tests sold
during the period. HIV Self-Test sales also increased
during the period, with unit sales totalling more than
500,000 tests, including strong pick up in Australian
sales volumes following a change in TGA guidelines.
These guidelines related to the promotion of the
Atomo HIV Self-Test and the removal of a prohibition
of its supply via pharmacies in December 2021.
As we move into FY23, Atomo is working to increase
revenues associated with its current core business.
In the HIV market, we continue to see sales growth in
the Self-Test business across LMIC, Europe and here
in Australia, and look to launching our professional
use product in key international markets this
year. We are also seeing a return to ordering from
our existing OEM customer base. Beyond existing
channels, Atomo remains focused on increased
engagement with the broader diagnostic market
and on raising awareness around Atomo’s unique
solutions, especially in the US market where the
opportunity for growth in the emerging home
test market is clearly defined. We can point to the
successful approvals, including Self-Test approval,
that Atomo’s OEM customers have been able to
achieve using our platforms and are encouraged by
the return of projects for blood-based testing and
new rapid test developments beyond COVID-19.
Outside of OEM channel opportunities, we are
excited by the emergence of a home testing segment
supported by the rapid adoption of telehealth
in the home and the widespread acceptance of
at-home testing by the public, and we note with
interest the entry of large eCommerce players to
the space in the last year. Atomo is actively engaged
with participants in this market that are seeking to
build an online healthcare presence and intends to
commercialise a number of new finished tests that
address opportunities in the home test market. As
we anticipate the most significant impact of the
COVID-19 pandemic being behind us, FY23 promises
to be an exciting year for Atomo. We will expand
our core business and enter into new product
applications, partnerships, and markets globally.
John Kelly
CEO, Atomo
04 KEY ACHIEVEMENTS AND CHALLENGES FY22
1. Completion of industralisation of operations to
support volume production of Atomo products,
including blister manufacturing – up to 18 million
of installed cassette capacity per annum now
available.
and development and commercialisation
of the next Atomo finished test product.
FY22 HIGHLIGHTS
• Strong revenue growth in FY22.
2. Successful participation in the local COVID-19*
market with more than $10 million in sales
revenue for the year, and well positioned for
further market demand in FY23 and beyond.
• Total GM of 42%, lower than FY21 due to skew
to COVID Antigen product resales, and HIV LMIC
global pricing.
• OpEx steady (1m COVID-19
rapid tests;
- $1.8 million from the sale of >500k HIV rapid
self-tests;
- $1.65 million in licence and settlement fees
from Access Bio;
- $120,000 in other customer revenue; and
- A further $1.0 million R&D rebate income.
* COVID-19 rapid testing detects SARS-COV-2, the virus that causes COVID-19
** American Association for Clinical Chemistry
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ATOMO ANNUAL REPORT FY22
05 DELIVERING ON OUR STRATEGY WITH
UNIQUE TECHNOLOGY AND KNOWLEDGE
"
Atomo believes that
the i ncre as ed fo cus on
decentralised testing chann e ls ,
par ticularly pharmacy and
hom e-based testing, enlarge s
the addre ss able market for
our consumer-focused
soluti ons.
John Kelly
CEO
COVID-19 has transformed the diagnostic testing
landscape globally. In the early stages of the
pandemic, Atomo supported its existing partners
in securing approval for a rapid blood-based
Antibody test in Europe and the US and invested
time securing Rapid Antigen Test approval in
Australia so that we could respond quickly when
this technology was needed by the community.
This enabled us to be an active participant in
the COVID-19 market while continuing to drive
forward with our core business of HIV Testing,
assessing new product and OEM opportunities
and continuing the development of unique user
focused rapid test devices.
OPERATIONAL CAPABILITY
AND EXPERTISE
Atomo has completed the expansion of its
manufacturing capabilities to enable the company
to commercialise a larger range of finished home
tests and deliver better supply economics.
We have invested in an improved manufacturing
process for automated high-volume blister
components. Compatible with Pascal and Elion-
based blood tests and the Swab Test device, this
proprietary integrated reagent functionality
offers best-in-class usability across a range of
point-of-care test markets.
INCREASED DECENTRALISED
SUPPLY CHAIN CAPABILITY
AND EXPANDED CAPACITY
• Goal of establishing North American-made
product capability for US customers and future
Government contracts (blister manufacturing
currently in US and component moulding
operations under development)
• Validated annual cassette production capacity
is currently ~18 million cassettes
• Atomo runs a validated fully integrated SAP
ERP system for all global operations and
logistics.
ATOMO’S GEN II BLISTER MACHINE
ATOMO SWAB PLATFORM
• Patented and commercialised proprietary
reagent blister component / delivery process
• Supports integrated test devices that require
a controlled reagent volume to run an assay
• Atomo has developed an automated
manufacturing process to produce at high
volumes, with a second machine built and
in validation.
The Atomo Swab Platform is a unique (patent
pending*) device developed using Atomo’s
existing core IP and know-how.
Developed to simplify workflow and improve
usability and performance of swab-based rapid
tests, this product expands Atomo’s product
range beyond blood-based testing.
Designed to support swab testing across
multiple applications (Nasal, nasopharyngeal,
throat, STI and other types of swabs).
The Atomo Swab platform delivers a measurable line intensity improvement when compared directly to two standard kits format swab rapid test products
(based on internal company testing, not verified as yet by independent external studies)
*Patent application number: 2022900285/P1812AU00
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ATOMO ANNUAL REPORT FY22 ATOMO ANNUAL REPORT FY22
06 WHAT WE VALUE, HOW WE CONTRIBUTE
At Atomo our values are important to us. We hold each other accountable to our values
and encourage them in our partners. We recognise each other for living these values
through our Simply Better Rewards program.
The goal of the program is to acknowledge staff that demonstrate core values by
encouraging employees to “shout out” their peers for demonstrating the values
These “shout outs” act as nominations for quarterly awards. The program reinforces that
collaboration and teamwork stand out as essential elements of how we work as a global
multi-disciplinary team.
This year we have been particularly focused on how we can better collaborate virtually as
our global footprint grows and new commercial team members have joined in the US and
UK. This includes cross functional business project teams selecting problems that they
seek to tackle through to fitness initiatives such as our Steptember global step challenge,
which encourages wellness and provides an opportunity for an informal weekly global
catch up to compare results.
VALUES
IMPACT
Commercialising products that matter to our users.
INNOVATION
Fostering creative thinking and solutions.
INTEGRITY
Ensuring honesty and fairness in all that we do.
COLLABORATION
Working as one global team.
EXCELLENCE
Being recognised as experts in the field.
EXAMPLES OF STAFF NOMINATIONS FOR EACH VALUE
Impact – Commercialising products that matter to our users
“Jimmy has done some great work improving conditions in SA where it was previously thought
these things were not possible. Small changes have a big impact on the staff “
Innovation – Fostering creative thinking and solutions
“Rohit is always thinking of new innovative ideas for Atomo products, in particular, the work he
has done on the app and digital health solutions”
Integrity – Ensuring honesty and fairness in all that we do
“Hanszeline always acts in the best interest of the production staff… Not only does she show
kindness but fairness as well.”
Collaboration – Working as one global team
“Rietha is definitely a team player, goes over and beyond what she needs to do… Honoured
to have her as a mentor”
Excellence – Being recognised as experts in our field
“Mark has a plethora of Quality assurance experience and he never fails to find most practical
solutions to Quality Assurance procedures”
Atomo team members in our Sydney and Cape Town premises
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ATOMO ANNUAL REPORT FY22
ATOMO – COMMUNITY IMPACT, LOCALLY AND GLOBALLY
Atomo’s impact principles reflect our values of collaboration and respect for all our stakeholders.
We operate in diverse communities globally and we are always conscious of the way in which we
operate and interact.
We partner with companies and other stakeholders that share our values, and, like us, place
importance on legal compliance, local community engagement, and sustainability practices.
Environment and sustainability
We ensure materials, energy and resources are used efficiently. Our recycled pallet
production targets reduction in wood use, changes to packaging reduce plastic use and
with production based in South Africa our operations base is closer to primary LMIC
markets helping to minimise logistics and supply chain impacts. We are constantly
seeking to improve environmental and sustainability performance.
Community engagement
We seek to maximise local engagement in operations through employment and contracting.
We demonstrate cultural sensitivity and respect for local customs and rights. We make cost-
effective, high-quality diagnostic products that deliver better health outcomes for people
worldwide, from remote regions of Africa to the streets of the big city.
Health and safety
We proactively apply best practice in
our workplace environments, with
the health and safety of our people
central to what we do. We advocate
for policy change to broaden access
and make testing available to those
that need it most. We commercialise
products that matter to our
users such as HIV, COVID-19 and
pregnancy testing.
Governance and
compliance
We maintain strict compliance with
corporate governance standards.
Our Board prioritises people,
strategies and practices that instil
and reinforce the company’s
purpose and values, ensure health
and wellbeing, and meet diversity
and inclusion objectives.
07 STRATEGY FOR FY23 AND BEYOND
"
Atomo continues to deliver on
its objective to be a global le ader
in rapid diagnostics. The a doption
of rapid diagnostics during the
• Commercialise a range of new Finished Tests
for Home and point of care market channels
for the US market:
- A blood-based pregnancy test for home use
as well as a screening test in A&E/ Emergency;
- An App/reader supported semi-quantitative
pandemic has changed users ’
test for home monitoring; and
behaviours and ex pe ctations of
testing.
John Keith
Chair, Atomo Board
Atomo is now switching focus and investment from
the expansion of installed manufacturing capacity,
which is now complete, to commercial scale up and
business development, including focusing on:
• Expansion of senior commercial resourcing and
associated engagement with market and channel
partners;
• Attendance at key industry conferences – AACC,
Next Gen Dx, Medica and Arab Health;
• Refreshed marketing, collateral and increased
promotion – website, materials, videos (watch our
Corporate video at https://www.youtube.com/
watch?v=RVA3BBcOUP4&t=23s).
• Scale up of Atomo’s OEM customer base utilising
our proven blood testing platforms, eHealth
solutions and in future Atomo’s swab device,
across key OEM channels;
• Direct engagement and promotion to diagnostic
companies;
• Establish a number of reseller partnerships –
development companies with access to new
test development programs; and
• Explore adjacent market opportunities,
including animal health.
- A swab-based test utilising the Atomo swab
device (once commercialised) – applications
of potential interest include COVID/ Flu A & B
combo plus a number of swab based STI’s.
DIGITAL INTEGRATION FOR
RAPID TESTING
The importance of digital health
• Digital health is changing how we predict,
monitor, manage and make decisions about our
health and well-being. Digital health supports
the delivery of healthcare in a broader range
of settings. Digital connectivity enhances the
performance and usefulness of rapid testing
within the healthcare ecosystem. The ability
to promptly deliver actionable diagnoses in
multimedia formats improves test outcomes.
The ability to automatically read accurate results
and, in many cases, quantitate the level of analyte
removes user interpretation errors and provides
increased precision in determining diagnostic
outcomes.
• The ability of digital health solutions to capture
and transmit results provides traceability and
eligibility for reimbursement, both of which
are necessary for widespread adoption in the
healthcare system. Rapidly connecting the dots
between patients, healthcare professionals
and supporters (either public health or
private insurers) is critical to the emergence of
decentralised testing channels in pharmacy
retail and increasingly in the home.
• The US is leading changes in the adoption
of digital health support services and is
implementing regulation that will optimise
product speed to market while maintaining
device safety and effectiveness.
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ATOMO ANNUAL REPORT FY22
ST user app (fully developed and ready for commercialisation)
Desktop reader (proof of concept developed,
not fully developed for commercialisation)
COMMERCIALISATION ROADMAP
Atomo has reviewed the changing point of care
test landscape post-pandemic, including
engagement with emerging eHealth companies
now opening up home-based healthcare. This
assessment of emerging product demand,
technical feasibility, regulatory pathway, and
go-to-market channels is enabling the company
to finalise its growth planning.
The company now intends to bring to market
during FY23 and FY24, in partnership with an
established rapid test player, a number of home
test and professional point of care tests utilising
Atomo’s integrated cassette and digital solutions.
Atomo’s focus on digital health
• During the year, Atomo developed two platform
offerings for use in the digital health space: an
app and a digital reader solution. The app will
accompany our existing platforms for use in
home settings. The second solution is a portable
reader compatible with our platforms for use in
professional point of care settings, such as doctor
offices and pharmacies.
• The app has been specifically designed for
untrained, self-test users and includes easy-
to-follow, animated steps of use, an integrated
incubation timer, functionality to capture a photo
of the developed test, confirmation that blood
has been delivered to the test and interpretation
of results via image recognition. The result is then
stored within the app and can be shared with a
physician or nominated organisations such as
insurance providers or employer.
• The reader solution is designed for fast,
quantitative throughput in point of care and
resource limited professional use settings.
Atomo is working with a number of leading
reader manufacturers to ensure that the readers
of the future in these channels are compatible
with Atomo’s cassettes and that Atomo has a
reader option to offer its customer base as well
as being available for Atomo finished tests.
EXPANDING DEMAND FOR OEM SUPPLY
Post-COVID-19, Atomo is actively engaging with a receptive diagnostic market
Resurgent interest in new
products and home testing
• Atomo has invested in growing our international
footprint, with a US corporate structure established
and senior business development resources engaged
in the US and Europe.
• Atomo has seen an increase in enquiries and
interest in new test development alongside a significant
market increase in point of care and home-based testing
post pandemic.
Anna Tucker and Jim McMenamy representing Atomo at AACC
• Recent engagement with the market, most recently at AACC and the Next Gen Dx conferences in the US,
is helping to raise awareness of Atomo in the industry and provides the company with confidence in the
commercial opportunities open to its blood and swab-based solutions. Recent market engagement also
generates an extensive list of potential new channel partners and customers.
Scalable solutions
With existing in-market products and customers, regulatory approvals and established production all
demonstrated, Atomo’s products are well positioned to establish themselves as a gold standard for
usability in rapid testing and offer the company an opportunity to rapidly expand its customer base
and applications menu through partnerships.
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ATOMO ANNUAL REPORT FY22
08 DIRECTORS' REPORT
The Directors present their report, together with
the financial statements, on the consolidated entity
(referred to hereafter as the 'Group') consisting of
Atomo Diagnostics Limited (referred to hereafter
as the 'Company' or 'Parent Entity') and the
entities it controlled at the end of, or during,
the year ended 30 June 2022.
All amounts are presented in Australian dollars
(AUD) unless otherwise stated.
DIRECTORS
The following persons were Directors of the Company during the year and up to the date of this report.
The Directors were in office for this entire period unless otherwise stated:
Director
Appointed
Resigned
John Keith (Chair & Non-Executive Director)
2 December 2011
John Kelly (Managing Director)
Curt LaBelle (Non-Executive Director)
Paul Kasian (Non-Executive Director)
Connie Carnabuci (Non-Executive Director)
1 April 2010
21 October 2016
4 February 2020
4 February 2020
n/a
n/a
n/a
n/a
9 December 2021
Deborah Neff (Non-Executive Director)
15 September 2021
n/a
The Company Secretary is Tharun Kuppanda, who was appointed on 25 January 2022
(Gilian Nairn resigned on 25 January 2022).
OPERATING & FINANCIAL REVIEW
Principal activities
The principal activities of the Group during the
course of the year were the development and sale
of medical devices.
There were no significant changes in the nature
of the activities of the Group during the year.
Review of operations
The loss for the consolidated entity after providing
for income tax amounted to $5,706,854 (2021: loss
of $6,021,215).
Revenue from customers increased by 108% for
the year to $13.99 million, compared with $6.72
million in 2021. Revenue growth was driven by:
• a substantial increase in sales of COVID-19
rapid tests which accounted for $10.4 million
in revenue, with more than one million tests
sold in Australia;
• an increase in sales of HIV products, with more
than half a million tests sold and revenue
of $1.8 million;
Cash and cash equivalents as at 30 June 2022
amounted to $12.97 million compared to $17.95
million as at 30 June 2021. Cash was invested in
completing investment in manufacturing and
production capacity such that Atomo is now
in a position to produce its Galileo and Pascal
blood-based rapid test devices at scale. Further,
ongoing investment was made in R&D to continue
innovation in rapid test devices, including in the
research, design, development and initial pilot
scale production of a swab-based device. Atomo
also invested in growing its international footprint,
with a US corporate structure established and
senior business development resources engaged
in the US and Europe.
Significant changes in the state
of affairs
• On 8 November 2021, the Company issued
320,000 share options to William Souter, CFO,
in relation to employment agreement re-
negotiation. These options are exercisable at an
exercise price of $0.25 per option and expire on
14 April 2024.
• revenue in relation to licence and settlement
• During the period, 2,293,184 options were
fees with customer Access Bio of $1.65 million,
reported as Other Income; and
• a further $120,000 in other customer revenues.
exercised resulting in the issue of 2,293,184
ordinary shares and a $68,800 cash contribution
when the exercise price was paid.
16
16
17
ATOMO ANNUAL REPORT FY22 • Tranche 1 (2,000,000 options) issued to Bondi
Partners on 31 May 2021 were fully vested on
31 October 2022. These options are exercisable
at an exercise price of $0.40 per option and
expire on 30 April 2024.
In the opinion of the Directors, there were no other
significant changes in the state of affairs of the
Group during the financial year.
Matters subsequent to the end of
the financial year
• 1,733,335 options issued to executives under the
Company's Post-IPO option plan lapsed as the
KPIs applicable to the options were not satisfied
with respect to the year ended 30 June 2022.
• The Board has exercised its discretion to allocate
1,199,999 options to executives under the
Company's post-IPO option plan to reward the
diligent execution of the corporate strategy and
to ensure retention of the key talent needed
to deliver strategic outcomes in the interest
of shareholders.
No other matter or circumstance has arisen since
30 June 2022 that has significantly affected, or
may significantly affect the Group’s operations,
the results of those operations, or the Group's
state of affairs in future financial years.
Impacts of COVID-19
During FY22, COVID-19 continued to have an
impact on operating conditions for the Company,
both positive and negative. Customers and target
customers in the diagnostics industry continued to
focus their efforts and investment on responding
to demand for COVID-19 testing solutions and
prioritised these over other opportunities. This
continued to delay some opportunities for Atomo
to move more quickly ahead with new partnerships
for OEM sales or finished product development.
The company’s performance was positively
impacted by COVID-19 as the Delta and Omicron
variants drove significant demand for Atomo’s
COVID-19 rapid tests in Australia over the period,
resulting in sales of more than one million tests
to the local Australian market in FY22.
Likely developments and expected
results of operations
With approximately $13 million of cash at bank
and no debt, Atomo is in a position to continue to
vigorously pursue its strategic goals in FY23. This
includes focusing on the following areas of activity:
• Continuing to support customer demand for
COVID-19 testing solutions as and when required,
and in the event that new variants impact on the
dynamics of the market;
• Continue to expand the Atomo HIV Self-Test
and point of care business, including growing
the Australian market, working with existing
distributors to ramp up activity in the UK, Europe
and global health markets, and targeting the
appointment of new distributors for the Atomo
HIV professional use product;
• Build and expand the OEM customer pipeline with
continued ramp up in market-facing activities in
developed markets, in particular Australia,
North America and UK/Europe;
• Finalise development and optimisation
of the Atomo swab device and seek initial
commercialisation partners; and
• Continue to work on integration of digital
functionality to enhance Atomo’s product offerings,
in particular the Atomo App for home use and a
clip in reader for point of care settings.
ENVIRONMENTAL AND SOCIAL RISKS
The Group’s operations are not subject to any
significant environmental regulation under
Australian Commonwealth or State law.
The Company has identified the following
sustainability issues most material to its business
and are important to key stakeholders such
as investors, consumers, customers, supplier,
governments and employees.
• Employee health and safety: Ensuring our
employees work in a safe environment,
which meets or exceeds relevant regulatory
expectations, addresses health and safety
concerns as they arise and mitigates the risk of
reoccurrence of incidents.
• Product quality and safety: Choosing materials
from quality sources, complying with ISO 13485
Medical Devices Quality Management, and
delivering safe products to customers. Atomo
aims to adhere to or exceed strict regulatory
standards in all jurisdictions that it serves, and
investigates all concerns to ensure our products
maintain the highest quality.
• Ethical purchasing and human rights in the
supply chain: Responsibility to partners to
ensure our product line is free from human rights
concerns such as forced labour and trafficking,
unsafe labour standards and unfair treatment.
These issues can arise wherever human resources
are utilised across the supply chain.
• Corruption and bribery: Business must be
conducted with transparency, and free from
unethical persuasion. Ethical business practices
relate to every aspect of Atomo’s business,
from identifying product sources, through the
development of diagnostics, transactions with
regulatory bodies and sale to customers.
• Compliance: Responsibility to drive compliance
with legal and regulatory requirements applicable
to our global business. Includes development
of policies and controls, communication and
training, oversight and continuous improvement.
Consequently, compliance affects every aspect
of what we do, to deliver quality products
to consumers.
• Resource use and waste management: Includes
energy usage during manufacture and logistics,
water usage and waste as a by-product of
manufacture, with particular consideration
given to the fact that the products are classified
as medical waste upon use. Stakeholders
increasingly demand disclosure of resource usage
and waste management for a more sustainable
product investment.
• Product pricing and accessibility: Strategies and
initiatives designed to provide more affordable
diagnostic pricing and accessibility to products for
patients through development, manufacture and
marketing of high-quality generic and branded
products, with a particular focus on accessible
diagnostics for the global health and Lower and
Middle Income markets.
The Board believes that the Group has adequate
systems in place for the management of its
exposure to environmental & social risks.
18
19
ATOMO ANNUAL REPORT FY22 INFORMATION ON DIRECTORS
Name: John Keith
Title: Non-Executive Chair
Experience and expertise: John Keith has served
as a Non-Executive Director of Atomo since
December 2011 and became Chair in 2014.
Mr Keith is one of the Managing Director at BNP
Paribas, establishing and leading its financial
institutions coverage team. Prior to joining
BNP Paribas in 2011, Mr Keith held country
management and senior business and coverage
positions for Nomura Securities in Sydney and
Hong Kong. His career comprises working with
supranational, sovereign and institutional
clients across all areas of investment and
institutional banking.
Mr Keith holds a Bachelor of Arts (Hons) majoring
in Economic History from the Victoria University
of Wellington, a Master of Applied Finance from
Macquarie University and a Global Executive MBA
from the University of Sydney.
Other current directorships: Nil
Former directorships (last 3 years): Nil.
Special responsibilities: Member of the Audit
and Risk Committee and Member of the People,
Culture & Remuneration Committee.
Interests in shares: 3,261,056
Interests in options: 1,200,000
Contractual rights to shares: Nil
Name: John Kelly
Title: Managing Director and CEO
Experience and expertise: John Kelly is the
Managing Director and CEO of Atomo.
For more than 20 years Mr Kelly has focused on
developing and commercialising medical devices
to enhance usability and performance, having
started with CR Bard in Europe developing Class III
implantable cardiology products.
Prior to co-founding Atomo in 2010, Mr Kelly
acted as the Chief Operating Officer (COO) of
Unilife Corporation, which was previously an
ASX-listed company (ASX:UNS) and subsequent
to his departure, a Nasdaq listed company
(NASDAQ:UNIS). At Unilife Corporation, he
led the global operations team from 2005 to
2008, developing ‘Unifill’, the world’s first glass
prefilled drug delivery device with integrated auto
retract safety feature, and this technology was
successfully licensed to Sanofi Aventis for US$47
million. Prior to joining Unilife in 2005, Mr Kelly
spent five years at ResMed where he led the New
Product Implementation Group and managed the
development of the ground-breaking Mirage Swift
and Activa mask systems.
Mr Kelly holds an Honours degree in Mechanical
Engineering from the University of Liverpool,
a Master’s degree in Manufacturing Systems
Engineering from Queen’s University Belfast, and
an Executive MBA from the University of Sydney,
where he was awarded the Business School’s
inaugural ‘Excellence in Leadership’ scholarship.
Other current directorships: Nil
Former directorships (last 3 years): Nil
Special responsibilities: Nil
Interests in shares: 72,490,248
Interests in options: 999,999
Contractual rights to shares: Nil
Name: Curt LaBelle
Title: Non-Executive Director
Name: Paul Kasian
Title: Non-Executive Director
Experience and expertise: Curt LaBelle has
served as a Non-Executive Director of Atomo
since October 2016.
Dr LaBelle has been actively involved in the
healthcare industry for over 20 years, both
operationally and as an investor. Dr LaBelle is
President at the Global Health Investment Fund
(GHIF), a social impact investment fund, which
manages approximately US$108 million backed by
the Gates Foundation, JP Morgan and others. He
also serves as a director on the boards of Z Optics,
Revelation Bio and Atticus Medical.
Prior to joining GHIF, Dr LaBelle was Managing
Director at Tullis Health Investors and Vice
President at Investor Growth Capital. He is a former
chairman of Impulse Monitoring (acquired by
Nuvasive), Exagen Inc. (NASDAQ:XGN) and a former
director of Sirion Therapeutics (products acquired
by Alcon and Bausch), SafeOp Surgical (acquired
by AlphaTec) and KAI Pharmaceuticals (acquired
by Amgen).
As Dr LaBelle is President at GHIF, a substantial
shareholder of Atomo, Dr LaBelle is not considered
to be an independent Director.
Dr LaBelle holds a Bachelor of Economics from
Brigham Young University, and MD and MBA
degrees from Columbia University.
Other current directorships: Director of Eyenovia
Inc. (NASDAQ:EYEN)
Former directorships (last 3 years): Former
chairman of Exagen Inc. (NASDAQ: XGN)
Special responsibilities: Nil
Interests in shares: 65,051,280
(inclusive of the GHIF Holding)
Interests in options: 1,200,000
Contractual rights to shares: Nil
Experience and expertise: Dr Kasian is an
experienced executive director with demonstrated
success in both domestic and international
companies encompassing senior leadership,
strategy, investment and risk roles.
His other roles have included Chief Investment
Officer and Head of Global Financials at HSBC Asset
Management, Founding Director of Accordius and
Founding Director of Wallara Asset Management.
He holds a PhD in Microbiology and a Master of
Business Administration, both from the University
of Melbourne, and is a Graduate Member of the
Australian Institute of Company Directors.
Other current directorships: Dr Kasian is currently
Non-Executive Director (appointed 31 August
2016) and Chair (appointed 15 September 2018) of
IODM Limited (ASX: IOD). He was appointed a Non
Executive Director of Zucero Therapeutics Limited
on 10 March 2021 and currently holds the role of
Chairman. He is also Non Executive Director of Eco
Systems Ltd (appointed 16 October 2019).
Former directorships (last 3 years): Previously
he served as a Non-Executive Director, then
Chairman and CEO of Genetic Technologies Limited
(appointed 12 December 2013 and resigned 23
September 2019).
Special responsibilities: Chair of the Audit and Risk
Committee and member of the People, Culture &
Remuneration Committee.
Interests in shares: 100,000
Interests in options: Nil
Contractual rights to shares: Nil
20
21
ATOMO ANNUAL REPORT FY22
Name: Connie Carnabuci
Title: Non-Executive Director
(Resigned 9 December 2021)
Name: Deborah Neff
Title: Non-Executive Director
(Appointed 15 September 2021)
Experience and expertise: Connie Carnabuci has
over 35 years' experience advising intellectual
property and technology intensive businesses in
Australia and across Asia on commercial, corporate
and regulatory matters.
She was recognised by the 2021 Australasian Law
Awards as one of the most influential lawyers
in Australia.
She is a professional Non-Executive Director and
currently serves on the Board and Remuneration
Committee of OFX Group Limited (ASX: OFX).
Ms Carnabuci is the former General Counsel of
the Australian Broadcasting Corporation and a
former partner of Mallesons Stephen Jacques and
Freshfields Bruckhaus Deringer.
She is a member of the Business Advisory Council
of the UNSW Business School.
She was a director and the Chair of the NFP, Kids
Giving Back, from 2015 to 2018.
Ms Carnabuci is a graduate of UNSW (B.Commerce
(Marketing), with merit/LLB, 1986) and the
Australian Institute of Company Directors.
Other current directorships: Connie Carnabuci
currently serves as a Non-Executive Director on the
Board, and the Remuneration Committee of OFX
Group Limited (ASX: OFX).
Former directorships (last 3 years): Nil
Special responsibilities: Nil
Interests in shares: 75,000
Interests in options: Nil
Experience and expertise: A veteran of the life
sciences industry, Deborah has spent most of her
career building market-leading global businesses.
As principal of DJN Consulting, LLC based in the
San Francisco Bay Area, Deborah currently works
with several privately held healthcare start-up
companies providing strategic business advice
and mentoring to the executive management
teams. Previously was CEO of Evanostics, LLC,
Pathwork Diagnostics Inc, and COO at Complete
Genomics following a 15 year career with Becton
Dickinson, where she last served as President of BD
Biosciences, a major business unit of the company.
She is an Executive Trustee of the University of
California, Davis Foundation and also chairs the
College of Biological Sciences Leadership Council
at the University.
She serves as an independent Director and
member of the Governance committee for Guide
Dogs for the Blind, Inc.
Deborah holds a Bachelor in Science degree from
the University of California, Davis.
Other current directorships: Non-Executive
Director and member of the Audit Committee for
Cytek Biosciences, Inc.
Former directorships (last 3 years): Nil
Special responsibilities: Chair of the People,
Culture & Remuneration Committee and member
of the Audit and Risk Committee.
Interests in shares: Nil
Interests in options: Nil
Contractual rights to shares: Nil
Contractual rights to shares: Nil
Other current and former (last 3 years)
directorships' quoted above are directorships for
listed entities only and excludes directorships of
all other types of entities, unless otherwise stated.
COMPANY SECRETARY
Tharun Kuppanda has over 10 years of legal and
governance experience with public companies
including previous roles as a Corporate
Advisory Lawyer.
Mr Kuppanda currently manages the Technical
Advisory function for BoardRoom Pty Ltd’s
Company Secretarial consulting practice. In his
role, Mr Kuppanda predominantly advises on large-
scale corporate actions and an entity’s continuous
disclosure obligations. Prior to joining BoardRoom,
Tharun worked in the Company Secretarial team
of a large financial institution and has previously
held public and private Company Secretarial
appointments in a number of industry sectors.
Mr Kuppanda holds a Bachelor of Laws and a
Bachelor of Business & Commerce (Accounting)
from WSU and a Graduate Diploma in Legal
Practice from ANU. He is a former associate of
the Governance Institute of Australia and holds a
current NSW legal practising certificate.
Mr Kuppanda was appointed as Company Secretary
on 25 January 2022. (Gillian Nairn held the position
between 1 July 2021 to 25 January 2022).
MEETINGS OF DIRECTORS
The number of meetings of the Company's Board
of Directors ('the Board') and of each Board
Committee held during the year ended 30 June
2022, and the number of meetings attended by
each director were:
Board
Audit & Risk
Committee
People, Culture &
Remuneration Committee
Held^
Attended
Held^
Attended
Held^
Attended
John Keith
John Kelly
Curt LaBelle1
Connie Carnabuci2
Paul Kasian
Deborah Neff1,2
13
13
13
8
13
9
13
13
12
8
13
7
6
-
2
3
6
4
6
-
2
3
6
4
4
-
-
3
4
1
4
-
-
3
4
1
^ Represents the number of meetings when the Director was eligible to attend as a member of the relevant committee.
1 Deborah Neff replaced Curt LaBelle on the Audit and Risk Committee effective 15 September 2021.
2 Deborah Neff replaced Connie Carnabuci as Chair of the People, Culture and Remuneration Committee effective 9 December 2021.
22
23
ATOMO ANNUAL REPORT FY22
REMUNERATION REPORT (AUDITED)
Remuneration governance
This Remuneration Report details the remuneration
arrangements of the key management personnel of
the Group, in accordance with the requirements of
the Corporations Act 2001 and its Regulations.
Key management personnel ('KMP') are those
persons having authority and responsibility for
planning, directing and controlling the activities
of the Group, directly or indirectly, including all
Directors of the Company.
The key management personnel of the Group
during the financial year consisted of the
following Directors of the Company:
• John Keith – Non-Executive Chair
• John Kelly – Founder and Managing Director
• Curt LaBelle – Non-Executive Director
• Paul Kasian – Non-Executive Director
• Connie Carnabuci – Non-Executive Director
(Resigned on 9 December 2021)
• Deborah Neff – Non-Executive Director
(Appointed 15 September 2021)
And the following executives:
• William Souter – Chief Financial Officer
• Mark Smith – Chief Operating Officer
(Resigned on 31 March 2022)
• Chandra Sukumar– Chief Operating Officer
(Appointed on 18 April 2022)
• Fabio Baglioni – Chief Commercial Officer
(Resigned on 30 July 2021)
The information in this Remuneration Report
is set out under the following headings:
• Remuneration governance
To assist the Board in fulfilling its responsibilities
in respect of remuneration and nomination
related matters, shortly prior to listing, the Board
established a Nomination and Remuneration
Committee. During the financial year, on the
recommendation of the Nomination and
Remuneration Committee, the Board extended
the scope of the Nomination and Remuneration
Committee’s responsibilities to include monitoring
and making recommendations to the Board in
relation to:
(i) recruitment, retention and termination policies
and practices for Executive Directors and direct
reports to the Managing Director and the
alignment of the policies and practices with the
promotion and sustainment of a culture aligned
with Atomo’s values, the promotion of long-term
sustainable success and the achievement of the
Company’s business objectives;
(ii) people strategies and practices which will instil
and reinforce the Company’s purpose and
values, ensure health and wellbeing (physical
and mental) and support the achievement of
the Company’s long-term business objectives;
and
(iii) the development of, and progress in meeting,
the Company’s diversity objectives.
To reflect the extended scope of the Nomination
and Remuneration Committee's responsibilities,
the Board renamed the Committee the 'People,
Culture & Remuneration Committee' and the
Board resumed nomination responsibilities. The
members of the People, Culture and Remuneration
Committee at the date of this report are:
• Non-Executive Directors’ remuneration
• Deborah Neff (Chair)
• Details of remuneration
• Service agreements
• Share-based compensation
• Additional disclosures relating to KMP
• John Keith
• Paul Kasian
The role and responsibilities, composition,
structure and membership requirements of the
People, Culture and Remuneration Committee
are documented in the People, Culture and
Remuneration Committee Charter available on
Atomo’s website at: https://atomodiagnostics.
com/governance/
The People, Culture and Remuneration Committee
Charter provides that the Committee should
comprise at least three members, all of whom are
Non-Executive Directors and a majority of whom
are independent Directors and the Chair of the
Committee should be an independent Director
who is not Chair of the Board.
All of the current members of the PCRC have been
assessed by the Board as being independent Non-
Executive Directors and the Chair of the Committee
is not Chair of the Board.
Principles used to determine the
nature and amounts of remuneration
Non-Executive Directors'
remuneration
Each of the Non-Executive Directors has entered
into appointment letters with Atomo confirming
the terms of their appointment and their roles and
responsibilities. The appointment letters are on
standard commercial terms.
The Chair, John Keith, receives an annual fee
of $130,000 and each Non-Executive Director
receives an annual fee of $50,000.
Each Chair of a Board Committee receives an
additional amount of $20,000 per annum. The
Chair of the Audit and Risk Committee is Paul
Kasian. Connie Carnabuci was the Chair of the
People, Culture and Remuneration Committee
until her resignation on 9 December 2021, at
which date Deborah Neff assumed the position.
During the period, a wholly owned subsidiary
was established in the US (Atomo US, Inc) which
required the appointment of a local US based
Director. Deborah Neff was appointed Director of
Atomo US, Inc effective 30 March 2022, for which
she receives an annual fee of $20,000.
Directors may also be reimbursed for expenses
properly incurred by them in dealing with the
Company’s business or in carrying out their
duties as a Director.
Under the Constitution, the Board decides the
amount paid to each Non-Executive Director as
remuneration for their services as a Director.
However, under the ASX Listing Rules, the total
amount of fees paid to all Non-Executive Directors
for their services must not exceed in aggregate
in any financial year the amount fixed by the
Company’s shareholders in general meeting. This
amount has been fixed initially in the Company’s
Constitution at $500,000 per annum in aggregate
and may be varied by ordinary resolution in a
general meeting.
Executive remuneration
The Group aims to reward executives based on
their position and responsibility, with a level and
mix of remuneration which has both fixed and
variable components.
The executive remuneration and reward
framework has four components:
• base pay and non-monetary benefits;
• short-term performance incentives;
• long-term performance incentives; and
• other remuneration such as superannuation
and long service leave.
The combination of these comprises the
executive's total remuneration.
Fixed remuneration, consisting of base salary,
superannuation and non-monetary benefits, is
reviewed annually by the People, Culture and
Remuneration Committee based on individual
and business unit performance, the overall
performance of the Group and comparable
market remunerations.
Executives may receive their fixed remuneration
in the form of cash or other fringe benefits (for
example motor vehicle benefits) where it does not
create any additional costs to the consolidated
entity and provides additional value to the
Executive.
The Company's short-term incentives ('STI') plan
is designed to align the targets of the business
units with the performance hurdles of executives.
STI payments are granted to Executives based on
specific targets and key performance indicators
('KPI's') being achieved. Details of STIs paid to
executives during the year can be found under
the heading 'Amounts of remuneration" below.
24
25
ATOMO ANNUAL REPORT FY22 The Company's long-term incentive ('LTI') plan includes share-based payments. Further details in
relation to Atomo’s Employee Share Option Plan ('ESOP') can be found under the heading “Share-based
compensation” below.
Details of remuneration
Amounts of remuneration
Details of the remuneration of the KMP of the Group are set out in the following tables. Where individuals
were KMP for only part of the year, only remuneration relating to that period is included in the tables below.
Short Term Benefits
Post-
employment
benefits
Cash
bonus
$
Other
monetary
$
Super-
annuation
$
Long-term
benefits
Share-based
payments
Long
service
leave
$
Equity-
settled
shares
$
Equity-
settled
options
$
Cash
salary
and fees
$
130,000
50,000
63,636
28,228
53,880
2022
Non-Executive
John Keith
Curt LaBelle
Paul Kasian
Connie Carnabuci*
Deborah Neff **
Executive Directors
John Kelly
367,825
94,500
Other Key Management Personnel
William Souter ++
267,117
90,000
Chandra Sukumar ^
62,864
Mark Smith ^^
Fabio Baglioni +
186,553
52,227
-
-
-
-
-
-
-
-
-
-
-
-
-
-
22,727
-
-
-
-
-
6,364
2,823
-
-
-
-
-
-
38,356
7,748
29,670
5,159
-
-
1,226
4,621
-
-
Total
$
130,000
50,000
70,000
31,051
53,880
-
-
-
-
-
24,662
533,091
39,459
450,199
-
72,644
15,784
202,337
-
52,227
79,905
1,645,428
-
-
-
-
-
-
-
-
-
-
-
1,262,329
184,500
22,727
82,372
13,595
* Resigned on 9 December 2021.
** Appointed on 15 September 2021.
^ Appointed on 18 April 2022.
^^ Resigned on 31 March 2022.
+ Resigned on 30 July 2021.
++ One-off payment of $25,000 (inclusive of super) included in Other monetary in relation to employment agreement re-negotiation
Short-term benefits
Post-
employment
benefits
Cash salary
and fees
$
Cash
bonus
$
Other
monetary
$
Super-
annuation
$
Long-
term
benefits
Long
service
leave
$
Share-based
payments
Equity-
settled
shares
$
Equity-
settled
options
$
Total
$
130,000
50,000
63,927
70,000
-
-
-
-
372,262
84,000
280,902
287,360
230,480
45,000
41,391
-
1,484,931
170,391
-
-
-
-
-
-
-
-
-
-
-
6,073
-
-
-
-
-
36,438
7,023
26,027
-
-
601
257
-
68,538
7,881
-
-
-
-
-
-
-
-
-
20,337
22,730
-
-
150,337
72,730
70,000
70,000
(32,422)
467,301
(25,938)
326,592
(25,938)
303,070
(25,938)
204,542
(67,169) 1,664,572
2021
Non-Executive
John Keith
Curt LaBelle*
Paul Kasian
Connie Carnabuci**
Executive Directors
John Kelly
Other Key
Management
Personnel
William Souter
Mark Smith ^
Fabio Baglioni ^^
* Amounts included under “Equity-settled options” include amounts paid to GHIF, of which Curt LaBelle is President.
** Resigned on 9 December 2021.
^ Resigned on 31 March 2022.
^^ Resigned on 30 July 2021.
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Name
2022
2021
2022
2021
2022
2021
Fixed remuneration
At risk – STI
At risk – LTI
100%
100%
100%
100%
100%
100%
100%
100%
100%
-
78%
89%
66%
100%
92%
100%
94%
-
95%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
18%
5%
(7%)
14%
-
14%
-
9%
-
-
-
(8%)
-
(9%)
-
Non-Executive Directors
John Keith
Curt LaBelle
Paul Kasian
Connie Carnabuci *
Deborah Neff **
Executive Directors
John Kelly
Other Key
Management
Personnel
William Souter
Chandra Sukumar ^
Mark Smith ^^
Fabio Baglioni +
* Resigned on 9 December 2021.
** Appointed on 15 September 2021.
^ Appointed on 18 April 2022.
^^ Resigned on 31 March 2022.
+ Resigned on 30 July 2021.
26
27
ATOMO ANNUAL REPORT FY22 Cash bonuses are dependent on meeting defined performance measures. The maximum bonus values are
established at the start of each financial year and amounts payable to KMPs are determined by the Board in
consultation with the People, Culture and Remuneration Committee.
The proportion of the cash bonus paid/payable or forfeited is as follows:
Name
Non-Executive Directors
John Keith
Curt LaBelle
Paul Kasian
Connie Carnabuci
Deborah Neff
Executive Directors
John Kelly
Other Key Management Personnel
William Souter
Chandra Sukumar*
Mark Smith
Fabio Baglioni
* Appointed on 18 April 2022.
SERVICE AGREEMENTS
Cash bonus paid/payable
Cash bonus forfeited
2022
2021
2022
2021
-
-
-
-
-
-
-
-
-
-
75%
100%
100%
-
-
-
75%
-
75%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Remuneration and other terms of employment for KMPs are formalised in service agreements. Details of
these agreements are as:
Name:
Title:
John Kelly
Managing Director
Employment commenced:
1 October 2011
Term of agreement:
Not specified.
Details:
Annual salary of $421,917.80 (including superannuation). The fixed
remuneration will alter by any changes in the compulsory superannuation
contribution that Atomo Diagnostics Limited is required to make. Plus a cash
bonus of up to 30% of gross salary (subject to the satisfaction of performance
criteria), to be reviewed annually by the People, Culture and Remuneration
Committee.
John Kelly is entitled to participate in the Company’s share and option plans.
Please refer to the section titled “Share-based compensation” for further
details.
Ten (10) week termination notice by either party, however this notice
period does not apply if the employment is terminated for serious and
wilful misconduct or any conduct by John Kelly that amounts to fraud,
theft, violence, harassment, gross negligence or any other action that may
otherwise bring the Company into disrepute.
Name:
Title:
William Souter
Chief Financial Officer
Employment commenced:
10 March 2020
Term of agreement:
Not specified.
Details:
Annual salary of $301,369.90 (including superannuation). The fixed
remuneration will alter by any changes in the compulsory superannuation
contribution that Atomo Diagnostics Limited is required to make. Plus a
cash bonus of up to 30% of gross salary (subject to the satisfaction of
performance criteria), to be reviewed annually by the People, Culture
and Remuneration Committee.
William Souter is entitled to participate in the Company’s share and option
plans. Please refer to the section titled “Share-based compensation” for
further details.
Sixteen (16) week termination notice by either party however this notice
period does not apply if the employment is terminated for serious and
wilful misconduct or any conduct by William Souter that amounts to fraud,
theft, violence, harassment, gross negligence or any other action that may
otherwise bring the Company into disrepute.
Name:
Title:
Chandra Sukumar
Chief Operating Officer
Employment commenced:
31 October 2016 (appointed as COO on 18 April 2022)
Term of agreement:
Not specified.
Details:
Annual salary of $250,000 (excluding superannuation) following appointment
to COO role on 18 April 2022. The fixed remuneration will alter by any changes
in the compulsory superannuation contribution that Atomo Diagnostics
Limited is required to make. Plus a cash bonus of up to 30% of base salary
(subject to the satisfaction of performance criteria), to be reviewed annually
by the People, Culture & Remuneration Committee.
Chandra Sukumar is entitled to participate in the Company’s share and
option plans. Please refer to the section titled “Share-based compensation”
for further details.
Ten (10) week termination notice by either party however this notice period
does not apply if the employment is terminated for serious and wilful
misconduct or any conduct by Chandra Sukumar that amounts to fraud,
theft, violence, harassment, gross negligence or any other action that may
otherwise bring the Company into disrepute.
28
29
ATOMO ANNUAL REPORT FY22
Name:
Title:
Mark Smith
Chief Operating Officer
Employment commenced:
1 October 2019
Resigned on:
31 March 2022
Term of agreement:
Not specified.
Details:
Annual salary of GBP 150,000 plus a cash bonus of up to 20% of base salary
(subject to the satisfaction of performance criteria), to be reviewed annually
by the People, Culture & Remuneration Committee.
Prior to his resignation, Mark Smith is entitled to participate in the
Company’s share and option plans. Please refer to the section titled
“Share-based compensation” for further details.
Eight (8) week termination notice by either party however this notice
period does not apply if the employment is terminated for serious and
wilful misconduct or any conduct by Mark Smith that amounts to fraud,
theft, violence, harassment, gross negligence or any other action that may
otherwise bring the Company into disrepute.
Name:
Title:
Fabio Baglioni
Chief Commercial Officer
Employment commenced:
17 February 2020
Agreement terminated:
30 July 2021
Term of agreement:
Not specified.
Details:
Annual salary of kr 1,320,000 plus a cash bonus of up to 20% of base salary
(subject to the satisfaction of performance criteria) to be reviewed annually
by the Nomination and Remuneration Committee/ Company. In addition,
the Company will also pay the CCO’s occupational pension to Collectum
under the terms of the benefit of ITP1.
Prior to his resignation, Fabio Baglioni was entitled to participate in the
Company’s share and option plans. Please refer to the section titled “Share-
based compensation” for further details.
Eight (8) week termination notice by either party however this notice
period does not apply if the employment is terminated for serious and
wilful misconduct or any conduct by Fabio Baglioni that amounts to fraud,
theft, violence, harassment, gross negligence or any other action that may
otherwise bring the Company into disrepute.
Share-based compensation
Share plan details
Prior to being listed on the ASX, the Company established a tax exempt employee share plan (“Tax
Exempt Plan”). Under the Tax Exempt Plan, the Company may offer an eligible person restricted shares
in the Company which are subject to a three year holding lock while the person remains employed by the
Company. Offers of restricted shares under the Tax Exempt Plan not exceeding a total value of A$1,000
or such other amount as permitted under Subdivision 83A-B of the Tax Act may be reduced from the
assessable income of that eligible person for the income year in which the eligible person acquires those
restricted shares. The objective of the Tax Exempt Plan is to align the interests of eligible Atomo employees
and contractors with shareholders through the sharing of a personal interest in the future growth and
development of the Company and to provide a means of attracting and retaining skilled and experienced
eligible persons.
As at the date of this report, 320,000 shares have been granted under the Tax Exempt Plan.
Option plan details
1. Pre-IPO option plan details
In prior financial years, the Company issued options to employees, Directors and key stakeholders to
align the interests of those parties through the sharing of a personal interest in the future growth and
development of the Company and to provide a means of attracting and retaining skilled and experienced
eligible persons.
As at the date of this report, the Company had the following options outstanding under the pre-IPO
option plans:
Expiry Date
11 April 2023
Total
Exercise price
Number of options
$0.16
4,800,000
4,800,000
All options were granted over unissued fully paid ordinary shares in the Company. Options granted carry
no dividend or voting rights.
2. Post-IPO option plan details
Shortly prior to being listed on the ASX, the Company established a new employee option plan to align the
interests of eligible employees and Directors with shareholders through the sharing of a personal interest
in the future growth and development of the Company and to provide a means of attracting and retaining
skilled and experienced eligible persons.
Upon Atomo’s admission to the official list of ASX, Atomo granted a total of 6,800,000 options under the post-
IPO option plan to the four (4) executive KMPs exercisable at $0.25 within thirty six (36) months from the date
of vesting. The options vest in three equal tranches in 12 months, 24 months and 36 months respectively,
subject to the satisfaction of vesting conditions relating to KPIs determined by the Managing Director or in
the case of the Managing Director, determined by the Board in consultation with the People, Culture and
Remuneration Committee, as follows:
KPI 1: ROI Hurdle:
15% per annum calculated using the following formula:
Change in EBITDA year on year/amount invested in operating assets during the year.
30
31
ATOMO ANNUAL REPORT FY22
KPI 2: Revenue Hurdle:
Tranche 1/FY21 – Revenue growth of 60%
Tranche 2/FY22 – Revenue growth of 40%
Tranche 3/FY23 – Revenue growth of 25%
As at the date of this report, the Company had on issue 4,013,330 options to KMPs under the post-IPO
option plan.
Name
John Kelly
John Kelly
William Souter
William Souter
Mark Smith
Mark Smith
Total
Vesting
date and
exercisable
date
Grant date
Expiry date
Exercise
price
14-Apr-20
14-Apr-23
14-Apr-26
8-Nov-21
8-Nov-21
14-Apr-24
14-Apr-20
14-Apr-23
14-Apr-26
8-Nov-21
8-Nov-21
14-Apr-24
14-Apr-20
14-Apr-23
14-Apr-26
8-Nov-21
8-Nov-21
14-Apr-24
$0.25
$0.25
$0.25
$0.25
$0.25
$0.25
Fair value
per option
at grant
date
$0.141
$0.074
$0.141
$0.074
$0.141
$0.074
Number
of options
granted
666,666
333,333
533,333
533,333
533,333
213,333
2,813,331
In addition to the above, subsequent to 30 June 2022, the Board has exercised its discretion to allocate
the following new options to management as part of the Company's remuneration scheme to reward the
diligent execution of the corporate strategy and to ensure retention of the key talent needed to deliver
strategic outcome in the interest of shareholders:
John Kelly
666,666 options
William Souter
533,333 options
Total
1,199,999 options
These options are exercisable at $0.25 per option and expire on 14 April 2025. In addition, these options
are conditional upon the executive remaining employed by the Company and in the case of John Kelly,
on Shareholder approval of the allocation.
All options were granted over unissued fully paid ordinary shares in the Company. Options granted carry
no dividend or voting rights.
Additional disclosures relating to Key Management Personnel
Shareholding:
The number of shares in the Company held during the financial year by each Director and other members
of the KMP of the Group, including their personally related parties, is set out below:
Ordinary shares
John Keith
John Kelly
Curt LaBelle*
Paul Kasian
Connie Carnabuci **
Deborah Neff ^
William Souter
Mark Smith ^^
Chandra Sukumar +
Totals
Balance at the
start of the year
Exercise
of options
Balance at the
end of the year
3,261,056
73,530,248
65,051,280
100,000
75,000
-
250,000
7,790,224
170,000
-
( 1,040,000)
-
-
-
-
-
-
-
3,261,056
72,490,248
65,051,280
100,000
75,000
-
250,000
7,790,224
170,000
150,227,808
( 1,040,000)
149,187,808
* Includes shares held by Global Health Investment Fund LLC. Curt LaBelle is President at GHIF.
** Resigned on 9 December 2021.
^ Appointed on 15 September 2021.
^^ Resigned on 31 March 2022.
+ Appointed on 18 April 2022.
Option holding:
The number of options over ordinary shares in the Company held during the financial year by each
Director and other members of key management personnel of the consolidated entity, including their
personally related parties, is set out below:
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
Balance
at the start
of the year
3,600,000
1,333,333
2,400,000
-
-
-
1,066,667
1,066,667
-
Options over ordinary shares
John Keith
John Kelly
Curt LaBelle *
Paul Kasian
Connie Carnabuci **
Deborah Neff ^
William Souter
Mark Smith ^^
Chandra Sukumar +
-
333,333
-
-
-
-
533,333
213,333
-
Totals
9,466,667
1,079,999
-
-
-
-
-
-
-
-
-
-
(2,400,000)
(666,667)
(1,200,000)
1,200,000
999,999
1,200,000
-
-
-
-
-
-
(533,334)
(533,334)
-
1,066,667
746,666
-
(5,333,335)
5,213,331
32
33
* Includes shares held by Global Health Investment Fund LLC. Curt LaBelle is President at GHIF.
** Resigned on 9 December 2021.
^ Appointed on 15 September 2021.
^^ Resigned on 31 March 2022.
+ Appointed on 18 April 2022.
ATOMO ANNUAL REPORT FY22
Other transactions with Key Management Personnel and their related parties:
Shares Under Option
Transactions between related parties are on normal commercial terms and conditions and no more
favourable than those available to other parties, unless stated otherwise. The following transactions
occurred with related parties:
Curt LaBelle is a Non-Executive Director of the Company and is also President of GHIF. GHIF is a substantial
shareholder of the Company holding 11.4% of the issued capital of the Company as at 30 June 2022
(2021: 11.4%).
Statutory performance indicators
The Company aims to align its executive remuneration to its strategic and business objective and the
creation of shareholder wealth. The table below shows measures of the Group’s financial performance
over the last three years (being the extent of available historic audited performance information) as required
by the Corporations Act 2001 . However, these are not necessarily consistent with the measures used in
determining the variable amounts of remuneration to be awarded to KMPs. As a consequence, there may
not always be a direct correlation between the statutory key performance measures and the variable
remuneration awarded.
Measure
2022
2021
2020
Loss for the year attributable to the Company ($)
(5,706,854)
(6,021,215)
(9,218,105)
Basic earnings per share (cents)
(1.00)
(1.07)
(2.59)
Dividend payments
Dividend payout ratio^
-
-
-
-
-
-
Increase/(decrease) in share price^^
(70%)
(46%)
70%
Total KMP incentives as a percentage
of profit/(loss) for the year
(28.8%)
(27.6%)
(13.3%)
^ The dividend payout ratio is calculated on dividends paid and profit for the year.
^^ Atomo’s shares first traded on the ASX on 16 April 2020 after successful completion of its IPO. Accordingly, no
share price information has been provided prior to FY20. For FY20, the movement in shares price has been calculated as the difference
between the IPO price (i.e. $0.20) and the closing price as at 30 June 2020 (i.e. $0.34).
Unissued ordinary shares of Atomo Diagnostics Limited under option as at the date of this report are as
follows:
Expiry Date
11 April 2023
14 April 2024
14 April 2025
14 April 2026
30 April 2024
30 April 2024
Total
Exercise Price
Number of Options
$0.16
$0.25
$0.25
$0.25
$0.40
$0.60
4,800,000
1,613,332
533,331
2,266,668
2,000,000
2,000,000
13,213,331
In addition to the above, the Board has exercised its discretion to allocate the following new options to
management as part of the Company's remuneration scheme to reward the diligent execution of the
corporate strategy and to ensure retention of the key talent needed to deliver strategic outcome in the
interest of shareholders:
John Kelly
666,666 options
William Souter
533,333 options
Total
1,199,999 options
These options are exercisable at $0.25 per option and expire on 14 April 2025. In addition, these options
are conditional upon the executive remaining employed by the Company and in the case of John Kelly,
on Shareholder approval of the allocation.
No person entitled to exercise the options had or has any right by virtue of the option to participate in
any share issue of the Company or of any other body corporate.
Shares issued on the Exercise of Options
The following ordinary shares of Atomo Diagnostics Limited were issued during the year ended 30 June
2022 and up to the date of this report on the exercise of options granted:
This concludes the Remuneration Report, which has been audited.
Date options granted
Exercise Price
Number of Options
21 November 2012
$0.03
Total
2,293,185
2,293,185
34
35
ATOMO ANNUAL REPORT FY22
Indemnity and insurance of officers
Officers of the Company who are former partners of the Company’s auditors
The Company has indemnified the Directors and Executives of the Group for costs incurred, in their capacity
as a Director or Executive, for which they may be held personally liable, except where there is a lack of
good faith.
During the financial year, the Group paid a premium in respect of a contract to insure the Directors and
Executives of the Group against a liability to the extent permitted by the Corporations Act 2001. The contract
of insurance prohibits disclosure of the nature of the liability and the amount of the premium.
Indemnity and insurance of the auditor
The Group has not, during or since the end of the financial year end, indemnified or agreed to indemnify the
auditor of the Group or any related entity against any liability incurred by the auditor.
During the financial year, the Group has not paid a premium in respect of a contract to insure the auditor of
the Group or any related entity.
Proceedings on behalf of the Group
No person has applied to the Court under Section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Group, or to intervene in any proceedings to which the Group is a party for the
purpose of taking responsibility on behalf of the Group for all or part of those proceedings.
Non-audit services
Details of the amounts paid or payable to the Company’s auditors for non-audit services provided during
the financial year by the auditors are outlined in Note 19 to the financial statements.
The Directors are satisfied that the provision of non-audit services during the financial year, by the
auditors (or by another person or firm on the auditors’ behalf), is compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001 .
The Directors are of the opinion that the services as disclosed in Note 19 to the financial statements do
not compromise the external auditors’ independence requirements of the Corporations Act 2001 for the
following reasons:
• all non-audit services have been reviewed and approved to ensure that they do not impact the integrity
and objectivity of the auditors; and
• none of the services undermine the general principles relating to auditor independence as set out in
APES 110 Code of Ethics for Professional Accountants issued by the Accounting Professional and Ethical
Standards Board, including reviewing or auditing the auditor's own work, acting in a management
or decision-making capacity for the Company, acting as advocate for the Company or jointly sharing
economic risks and rewards.
There are no officers of the company who are former partners of BDO.
Rounding of amounts
The Group is of a kind referred to in Corporations Instrument 2016/191 , issued by the Australian Securities
and Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in
accordance with that Corporations Instrument to the nearest dollar.
Auditor’s independence declaration
A copy of the auditor's independence declaration as required under Section 307C of the Corporations Act
2001 is set out immediately after this Directors' Report.
Auditor
BDO Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution of Directors, pursuant to Section 298(2)(a)
of the Corporations Act 2001.
On behalf of the Directors:
John Keith
Chair
25 August 2022
Sydney
36
37
ATOMO ANNUAL REPORT FY22
ATOMO ANNUAL REPORT FY22
09 FINANCIAL STATEMENTS
AUDITOR’S DECLARATION
Tel: +61 2 9251 4100
Fax: +61 2 9240 9821
www.bdo.com.au
Level 11, 1 Margaret St
Sydney NSW 2000
Australia
DECLARATION OF INDEPENDENCE BY GARETH FEW TO THE DIRECTORS OF ATOMO DIAGNOSTICS
LIMITED
As lead auditor of Atomo Diagnostics Limited for the year ended 30 June 2022, I declare that, to the
best of my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Atomo Diagnostics Limited and the entities it controlled during the
period.
Gareth Few
Director
BDO Audit Pty Ltd
Sydney
25 August 2022
38
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members
of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent
member firms. Liability limited by a scheme approved under Professional Standards Legislation.
39
CONTENTS
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
41
42
43
44
45
78
80
GENERAL INFORMATION
The financial statements cover Atomo Diagnostics Limited as a consolidated entity consisting
of Atomo Diagnostics Limited and the entities it controlled at the end of, or during, the year.
The financial statements are presented in Australian Dollars, which is Atomo Diagnostics
Limited's functional and presentation currency.
Atomo Diagnostics Limited is a listed public company limited by shares, incorporated and
domiciled in Australia. Its registered office and principal place of business are:
Registered office
Principal place of business
Level 1
3 - 5 George Street
Leichhardt NSW 2040
Level 1
3 - 5 George Street
Leichhardt NSW 2040
A description of the nature of the Group’s operations and its principal activities are
included in the Directors’ Report, which is not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution
of Directors, on 25 August 2022. The Directors have the power to amend and reissue
the financial statements.
Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the Year Ended 30 June 2022
Revenue
Cost of sales
Gross profit
Other income
Employee benefits expenses
Foreign exchange gains/(losses)
Depreciation and amortisation
Research and development expenses
Insurance
Inventory obsolescence expense
IT expenses
Occupancy expenses
Professional and consulting fees expense
Regulatory expenses
Travel expenses
Other expenses
Results from operating activities
Finance income
Finance costs
Net finance income/(cost)
Loss before income tax
Income tax (expense)/benefit
Loss for the year
Other comprehensive income and expenses
Foreign currency translation reserve
Consolidated
Note
2022
2021
3
3
12,336,111
(8,090,427)
4,245,684
6,715,659
(3,296,835)
3,418,824
2,685,407
814,226
4(a)
(4,102,416)
4(b)
4(c)
4(c)
4(c)
5(a)
87,653
(1,997,405)
(1,410,756)
(441,499)
(362,889)
(264,263)
(43,929)
(3,813,094)
(408,689)
(1,318,327)
(820,640)
(349,621)
(332,332)
(214,862)
(6,417)
(2,325,613)
(1,786,510)
(689,010)
(123,735)
(954,069)
(397,854)
12,573
(901,403)
(5,696,840)
(6,104,126)
5,456
(15,470)
(10,014)
90,696
(7,785)
82,911
(5,706,854)
(6,021,215)
-
-
(5,706,854)
(6,021,215)
164,612
223,652
Total comprehensive income for the period
(5,542,242)
(5,797,563)
Loss per share for profit attributable to owners
of Atomo Diagnostics Limited
Basic earnings per share
Diluted earnings per share
27
27
Cents
(1.003)
(1.003)
Cents
(1.067)
(1.067)
The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes
40
41
ATOMO ANNUAL REPORT FY22
Consolidated Statement of Financial Position
As at 30 June 2022
Consolidated Statement of Changes in Equity
For the Year Ended 30 June 2022
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Lease liabilities
Provisions
Total current liabilities
Non-current liabilities
Lease liabilities
Provisions
Total non-current liabilities
Total Liabilities
Net assets
Equity
Issued capital
Foreign currency translation reserve
Share based payment reserve
Accumulated losses
Total equity
Consolidated
Note
2022
2021
6(a)
12,966,400
17,946,517
7
8
9
10
11
12
13
14
13
14
15
16
16
2,678,106
3,420,647
4,494,368
3,042,245
19,065,153
25,483,130
3,665,230
316,786
3,574,690
7,556,706
3,662,977
66,865
3,025,834
6,755,676
26,621,859
32,238,806
1,083,212
1,783,958
155,926
291,158
67,589
276,804
1,530,296
2,128,351
184,879
92,970
277,849
-
23,074
23,074
1,808,145
2,151,425
24,813,714
30,087,381
68,036,837
67,921,661
(63,078)
866,426
(227,690)
713,027
(44,026,471)
(38,319,617)
24,813,714
30,087,381
The above statement of financial position should be read in conjunction with the accompanying notes
Loss for the year
Other comprehensive income
Total other comprehensive
income for the year
Transactions with owners,
recorded directly in equity
Equity-settled share based
payments
Exercise of options
Issue costs
Issued
Capital
Foreign
Currency
Translation
Reserve
Share Based
Payment
Reserve
Accumulated
Losses
Total Equity
Balance as at 1 July 2020
66,514,571
(451,342)
746,970
(32,329,359)
34,480,840
-
-
-
-
223,652
223,652
-
-
-
(6,021,215)
(6,021,215)
-
223,652
(6,021,215)
(5,797,563)
108,000
1,311,482
(12,392)
-
-
-
-
-
320,951
(188,373)
-
(166,521)
(33,943)
-
-
-
30,957
30,957
428,951
1,123,109
(12,392)
(135,564)
1,404,104
Lapsed and Cancelled Options
-
Total transactions with owners
1,407,090
Balance as at 30 June 2021
67,921,661
(227,690)
713,027
(38,319,617)
30,087,381
Balance as at 1 July 2021
67,921,661
(227,690)
713,027
(38,319,617)
30,087,381
Loss for the year
Other comprehensive income
Total other comprehensive
income for the year
Transactions with owners,
recorded directly in equity
Equity-settled share based
payments
Exercise of options
Issue costs
Total transactions with owners
-
-
-
-
116,426
(1,250)
115,176
-
164,612
164,612
-
-
-
(5,706,854)
(5,706,854)
-
164,612
(5,706,854)
(5,542,242)
-
-
-
-
201,029
(47,630)
-
153,399
-
-
-
-
201,029
68,796
(1,250)
268,575
Balance as at 30 June 2022
68,036,837
(63,078)
866,426
(44,026,471)
24,813,714
The above statement of changes in equity should be read in conjunction with the accompanying notes
42
43
ATOMO ANNUAL REPORT FY22
10 NOTES TO THE FINANCIAL STATEMENTS
Consolidated Statement of Cash Flows
For the Year Ended 30 June 2022
Cash flows from operating activities
Receipts from customers (inc. GST)
Payments to suppliers and employees (inc. GST)
Cash used in operations
Interest received
Interest paid
R&D and other government incentives received
Consolidated
Note
2022
2021
16,315,588
8,012,295
(20,951,514)
(13,480,610)
(4,635,926)
(5,468,315)
5,456
-
90,696
(5,430)
1,823,828
1,157,798
Net cash from/(used in) operating activities
6(b)
(2,806,642)
(4,225,251)
Cash flows from investing activities
Payments for property, plant and equipment
Payments for intangible asset
Net cash from/(used in) investing activities
Cash flows from financing activities
Repayment of leases
Net proceeds from issue of share capital
Net cash from/(used in) financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effect of exchange rate fluctuations on cash held
(1,392,793)
(3,119,797)
(912,709)
(2,777,775)
(2,305,502)
(5,897,572)
(49,938)
67,546
17,608
(113,347)
1,110,718
997,371
(5,094,536)
(9,125,452)
17,946,517
27,103,838
114,419
(31,869)
Cash and cash equivalents at the end of the financial year
6(a)
12,966,400
17,946,517
The above statement of cash flows should be read in conjunction with the accompanying notes
44
4545
ATOMO ANNUAL REPORT FY22
NOTES TO THE FINANCIAL STATEMENTS
Note 1: Significant accounting
policies
The principal accounting policies adopted in
the preparation of the financial statements
are set out below. These policies have been
consistently applied to all the years presented,
unless otherwise stated.
(a) New or amended Accounting
Standards and Interpretations adopted
The consolidated entity has adopted all of the
new or amended Accounting Standards and
Interpretations issued by the Australian Accounting
Standards Board ('AASB') that are mandatory for
the current reporting period.
Any new or amended Accounting Standards or
Interpretations that are not yet mandatory have
not been early adopted.
The Directors have reviewed all of the new and
revised accounting standards and interpretations
issued by the Australian Accounting Standards
Board for annual reporting periods beginning
or after 1 July 2021. It has been determined that
there is no impact, material or otherwise, of any
other new or revised accounting standards
and interpretations.
(b) Basis of preparation
These general purpose financial statements have
been prepared in accordance with Australian
Accounting Standards and Interpretations
issued by the Australian Accounting Standards
Board ('AASB') and the Corporations Act 2001 , as
appropriate for for-profit oriented entities. These
financial statements also comply with International
Financial Reporting Standards as issued by the
International Accounting Standards Board ('IASB').
Historical cost
The financial statements have been prepared
under the historical cost convention, except for,
where applicable, the revaluation of financial
assets and liabilities at fair value through profit or
loss, financial assets at fair value through other
comprehensive income, investment properties,
certain classes of property, plant and equipment
and derivative financial instruments.
Reclassification of prior year amounts
and balances:
When required by Accounting Standards,
comparative figures have been adjusted to
conform to changes in presentation for the
current financial year.
Critical accounting estimates:
The preparation of the financial statements
requires the use of certain critical accounting
estimates. It also requires management to exercise
its judgement in the process of applying the
consolidated entity's accounting policies. The
areas involving a higher degree of judgement
or complexity, or areas where assumptions
and estimates are significant to the financial
statements, are disclosed in Note 2.
(c) Parent entity
In accordance with the Corporations Act 2001 ,
these financial statements present the results
of the consolidated entity only. Supplementary
information about the parent entity is disclosed
in Note 24.
(d) Principles of consolidation
The consolidated financial statements incorporate
the assets and liabilities of all subsidiaries of Atomo
Diagnostics Limited ('company' or 'parent entity')
as at 30 June 2022 and the results of all subsidiaries
for the year then ended. Atomo Diagnostics Limited
and its subsidiaries together are referred to in these
financial statements as the 'consolidated entity'.
Subsidiaries are all those entities over which the
consolidated entity has control. The consolidated
entity controls an entity when the consolidated
entity is exposed to, or has rights to, variable
returns from its involvement with the entity and
has the ability to affect those returns through
its power to direct the activities of the entity.
Subsidiaries are fully consolidated from the date
on which control is transferred to the consolidated
entity. They are de-consolidated from the date that
control ceases.
Intercompany transactions, balances and
unrealised gains on transactions between entities
in the consolidated entity are eliminated except
where such amounts arise on monetary items
that form part of the net investments in a foreign
operation, in which case they are recognised in
reserves. Unrealised losses are also eliminated
unless the transaction provides evidence of the
impairment of the asset transferred. Accounting
policies of subsidiaries have been changed where
necessary to ensure consistency with the policies
adopted by the consolidated entity.
The acquisition of subsidiaries is accounted for
using the acquisition method of accounting. A
change in ownership interest, without the loss of
control, is accounted for as an equity transaction,
where the difference between the consideration
transferred and the book value of the share of the
non-controlling interest acquired is recognised
directly in equity attributable to the parent.
Non-controlling interest in the results and equity of
subsidiaries are shown separately in the statement
of profit or loss and other comprehensive income,
statement of financial position and statement of
changes in equity of the consolidated entity. Losses
incurred by the consolidated entity are attributed
to the non-controlling interest in full, even if that
results in a deficit balance.
Where the consolidated entity loses control over
a subsidiary, it derecognises the assets including
goodwill, liabilities and non-controlling interest
in the subsidiary together with any cumulative
translation differences recognised in equity. The
consolidated entity recognises the fair value of the
consideration received and the fair value of any
investment retained together with any gain or loss
in profit or loss.
(e) Operating segments
The Group manages its operations as a single
business operation and there are no parts of the
Group that qualify as operating segments under
AASB 8 Operating Segments. The CEO (Chief
Operating Decision Maker or “CODM”) assesses the
financial performance of the Group in an integrated
basis only and accordingly, the Group is managed
on the basis of a single segment, being medical
device research and development. Information
presented to the CODM on a monthly basis is
categorised by type of expenditure.
(f) Foreign currency translation
The financial statements are presented in
Australian dollars, which is Atomo Diagnostics
Limited's functional and presentation currency.
Foreign currency transactions:
Foreign currency transactions are translated
into Australian dollars using the exchange rates
prevailing at the dates of the transactions. Foreign
exchange gains and losses resulting from the
settlement of such transactions and from the
translation at financial year-end exchange rates
of monetary assets and liabilities denominated in
foreign currencies are recognised in profit or loss.
Foreign operations:
The assets and liabilities of foreign operations
are translated into Australian dollars using the
exchange rates at the reporting date. The revenues
and expenses of foreign operations are translated
into Australian dollars using the average exchange
rates, which approximate the rates at the dates
of the transactions, for the period. All resulting
foreign exchange differences are recognised in
other comprehensive income through the foreign
currency reserve in equity.
The foreign currency reserve is recognised in
profit or loss when the foreign operation or net
investment is disposed of.
(g) Revenue recognition
The consolidated entity recognises revenue
as follows:
Revenue from contracts with customers
and sale of goods
Revenue is measured based on the consideration
specified in a contract with a customer. The Group
recognises revenue when it transfers control over
a good or service to a customer.
46
47
ATOMO ANNUAL REPORT FY22
Customers obtain control of the HIV self-testing kits
when the goods are ready and released by Quality
Assurance (QA). It is then the responsibility of the
customer to make the necessary arrangements for
freight and the collection of goods from the Group’s
warehouse. Invoices are generated once the goods
are released by QA and ready for collection by the
customer. Invoices are usually payable within 30 to
75 days, dependent on the contracted agreement.
The contracts do not allow the customers to return
the goods as the testing kits have a set shelf-life
and have gone through vigorous testing prior
to delivery.
Where sales are made to customers on an OEM
basis for use in their own test, including for
COVID-19, revenue is recognised at the point
transfer of control over those products at the
warehouse delivery point.
Since none of the contracts permit the customer
to return an item, revenue is recognised for all
the goods once the goods have been released
by QA and are available for collection at the
Group’s warehouse.
Interest
Interest revenue is recognised as interest accrues
using the effective interest method. This is a
method of calculating the amortised cost of a
financial asset and allocating the interest income
over the relevant period using the effective
interest rate, which is the rate that exactly
discounts estimated future cash receipts through
the expected life of the financial asset to the net
carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or
when the right to receive payment is established.
(h) Income tax
Income tax expense comprises current and
deferred tax. It is recognised in profit or loss
except to the extent that it relates to a business
combination, or items recognised directly in
equity or in other comprehensive income.
Current tax:
Current tax comprises the expected tax payable
or receivable on the taxable income or loss for
the year and any adjustment to tax payable
or receivable in respect of previous years. It is
measured using tax rates enacted or substantively
enacted at the reporting date. Current tax also
includes any tax liability arising from dividends.
Current tax assets and liabilities are offset only if
certain criteria are met.
Deferred tax:
Deferred tax is recognised in respect of temporary
differences between the carrying amounts of assets
and liabilities for financial reporting purposes and
the amounts used for taxation purposes. Deferred
tax is not recognised for temporary differences on
the initial recognition of assets or liabilities in a
transaction that is not a business combination and
that affects neither accounting nor taxable profit or
loss, or on taxable temporary differences arising on
the initial recognition of goodwill.
Deferred tax assets are recognised for unused
tax losses, tax credits and deductible temporary
differences, to the extent that it is probable that
future taxable profits will be available against
which they can be utilised. Deferred tax assets are
reviewed at each reporting date and are reduced
to the extent that it is no longer probable that the
related tax benefit will be realised; such reductions
are reversed when the probability of future taxable
profits improves.
Unrecognised deferred tax assets are reassessed at
each reporting date and recognised to the extent
that it has become probable that future taxable
profits will be available against which they can
be used.
Deferred tax is measured at the tax rates that are
expected to be applied to temporary differences
when they reverse, using tax rates enacted or
substantively enacted at the reporting date.
The measurement of deferred tax reflects the tax
consequences that could follow the manner in
which the Group expects, at the reporting date,
to recover or settle the carrying amount of its
assets and liabilities.
Deferred tax assets and liabilities are offset only
if certain criteria are met.
R&D tax incentives:
R&D tax incentives received by the Group are
recognised as other income over the periods
necessary to match the benefit of the incentive
with the costs for which it is intended to
compensate (“associated costs”). Such periods
will depend on whether the associated costs are
capitalised or expensed as incurred.
Under this policy, for that portion of associated
costs which are expensed during the period, the
proportional incentive is recognised in other
income in full during the same period. For that
portion of associated costs which are capitalised
during the period, the proportional incentive is
initially offset against the capitalised associated
costs and recognised against amortisation expense
on a systematic basis matching the useful life of
the capitalised asset.
(i) Current and non-current classification
Assets and liabilities are presented in the statement
of financial position based on current and non-
current classification.
An asset is classified as current when: it is either
expected to be realised or intended to be sold or
consumed in the consolidated entity's normal
operating cycle; it is held primarily for the purpose
of trading; it is expected to be realised within
12 months after the reporting period; or the asset
is cash or cash equivalent unless restricted from
being exchanged or used to settle a liability for at
least 12 months after the reporting period. All other
assets are classified as non-current.
A liability is classified as current when: it is either
expected to be settled in the consolidated entity's
normal operating cycle; it is held primarily for the
purpose of trading; it is due to be settled within
12 months after the reporting period; or there is
no unconditional right to defer the settlement
of the liability for at least 12 months after the
reporting period. All other liabilities are classified
as non-current.
Deferred tax assets and liabilities are always
classified as non-current.
(j) Cash and cash equivalents
Cash and cash equivalents includes cash on hand,
deposits held at call with financial institutions,
other short-term, highly liquid investments with
original maturities of three months or less that are
readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes
in value.
(k) Trade and other receivables
Trade receivables are initially recognised at fair
value and subsequently measured at amortised
cost using the effective interest method, less
any allowance for expected credit losses. Trade
receivables are generally due for settlement
within 30 days but certain customers have longer
payment terms.
Other receivables are recognised at amortised cost,
less any allowance for expected credit losses.
(l) Inventories
Raw materials, work in progress and finished goods
are stated at the lower of cost and net realisable
value on a 'first in first out' basis.
Net realisable value is the estimated selling price in
the ordinary course of business less the estimated
costs of completion and the estimated costs
necessary to make the sale.
(m) Property, plant and equipment
Recognition and measurement:
Items of property, plant and equipment are
measured at cost less accumulated depreciation
and accumulated impairment losses. Cost includes
expenditure that is directly attributable to the
acquisition of the asset.
If significant parts of an item of property, plant
and equipment have different useful lives, they
are accounted for as separate items (major
components) of property, plant and equipment.
Any gain and loss on disposal of an item of
property, plant and equipment is recognised in
profit or loss.
48
49
ATOMO ANNUAL REPORT FY22 Subsequent expenditure:
Subsequent expenditure is capitalised only when
it is probable that the future economic benefits
associated with the expenditure will flow to
the Group.
Depreciation:
Depreciation is calculated based on the cost of
property, plant and equipment less their estimated
residual values using the straight-line basis over
their estimated useful lives, and is generally
recognised in profit or loss.
The estimated useful lives of property, plant and
equipment are as follows:
Plant and equipment
2 - 5 years
Depreciation methods, useful lives and residual
values are reviewed at each reporting date and
adjusted if appropriate.
(n) Leases
The Group recognises a right-of-use asset and a
lease liability at the lease commencement date.
The right-of-use asset is initially measured at cost,
which comprises the initial amount of the lease
liability adjusted for any lease payments made at
or before the commencement date, plus any initial
direct costs incurred and an estimate of costs to
dismantle and remove the underlying asset or to
restore the underlying asset or the site on which it
is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated
using the straight-line method from the
commencement date to the earlier of the end of
the useful life of the right-of-use asset or the end of
the lease term. The estimated useful lives of right-
of-use assets are determined on the same basis
as those of property and equipment. In addition,
the right-ofuse asset is periodically reduced by
impairment losses, if any, and adjusted for certain
remeasurements of the lease liability.
The lease liability is initially measured at the
present value of the lease payments that are not
paid at the commencement date, discounted using
the interest rate implicit in the lease or, if that
rate cannot be readily determined, the Group’s
incremental borrowing rate. Generally, the Group
uses its incremental borrowing rate as the
discount rate.
The lease liability is measured at amortised
cost using the effective interest method. It is
remeasured when there is a change in future lease
payments arising from a change in an index or rate,
if there is a change in the Group’s estimate of the
amount expected to be payable under a residual
value guarantee, or if the Group changes its
assessment of whether it will exercise a purchase,
extension or termination option.
The Group has elected not to recognise right-of-use
assets and lease liabilities for short-term leases
that have a lease term of 12 months or less and
leases of low-value assets. The Group recognises
the lease payments associated with these leases
as an expense on a straight-line basis over the
lease term.
(o) Intangible assets
Recognition and measurement
Computer software:
Computer software comprises computer
application system software and licenses. Costs
incurred in developing products or systems and
costs incurred in acquiring software and licenses
that will contribute to future period financial
benefits through revenue generation and/or cost
reduction are capitalised to computer software.
Costs capitalised include external direct costs of
materials and services, direct payroll and payroll-
related costs.
Patents, trademarks and licences
Other intangible assets, including patents,
trademarks and licences that are acquired by the
Group and have finite useful lives are measured
at cost less any accumulated amortisation and
impairment losses.
Capitalised development costs
Capitalised development costs relate to the
Company’s rapid test platforms and associated
manufacturing assets and are capitalised only if the
expenditure can be measured reliably, the product
or process is technically and commercially feasible,
future economic benefits are probable, and the
Group intends to and has sufficient resources to
complete development and to use or sell the
asset. Otherwise, it is recognised in profit or loss
as incurred. Subsequent to initial recognition,
development expenditure is measured at cost less
accumulated amortisation and any accumulated
impairment losses.
Expenditure on research activities is recognised in
profit or loss as incurred.
Subsequent expenditure
Subsequent expenditure is capitalised only when it
increases the future economic benefits embodied
in the specific asset to which it relates. All other
expenditure, including expenditure on internally
generated goodwill and brands, is recognised in
profit or loss as incurred.
Amortisation
Amortisation is calculated based on the cost of
intangible assets less their estimated residual
values using the straight-line method over their
estimated useful lives, and is generally recognised
in profit or loss.
The estimated useful lives of intangible assets are
as follows:
Patents and trademarks
Other intangibles
Capitalised development costs
10 - 20 years
10 years
10 years
Amortisation methods, useful lives and residual
values are reviewed at each reporting date and
adjusted if appropriate.
(p) Impairment
Non-financial assets
At each reporting date, the Group reviews the
carrying amounts of its non-financial assets (other
than deferred tax assets) to determine whether
there is any indication of impairment. If any such
indication exists, then the asset’s recoverable
amount is estimated.
For impairment testing, assets are grouped
together into the smallest group of assets that
generates cash inflows from continuing use that
are largely independent of the cash inflows of other
assets or cash generating units ("CGUs").
The recoverable amount of an asset or CGU is the
greater of its value in use and its fair value less
costs to sell. Value in use is based on the estimated
future cash flows, discounted to their present value
using a pre-tax discount rate that reflects current
market assessments of the time value of money
and the risks specific to the asset or CGU.
An impairment loss is recognised if the carrying
amount of an asset or CGU exceeds its recoverable
amount. Impairment losses are recognised in
profit or loss. They are allocated first to reduce
the carrying amount of any goodwill allocated
to the CGU, and then to reduce the carrying
amount of assets in the CGU on a pro rata basis.
An impairment loss is reversed only to the extent
that the asset’s carrying amount does not exceed
the carrying amount that would have been
determined, net of depreciation or amortisation,
if no impairment loss had been recognised.
(q) Trade and other payables
These amounts represent liabilities for goods
and services provided to the Group prior to the
end of the financial year and which are unpaid.
Due to their short-term nature they are measured
at amortised cost and are not discounted. The
amounts are unsecured and are usually paid within
30 days of recognition.
(r) Financial instruments
Classification and measurement –
non-derivative financial assets and
financial liabilities:
The Group's management assessed which business
models applied to the financial assets held by the
Group and classified its financial instruments into
the appropriate AASB 9 categories.
Financial assets classified as held-to-maturity
and loans and receivables under AASB 139 that
were measured at amortised cost continued to
be measured at amortised cost under AASB 9 as
they are held within a business model to collect
contractual cash flows and these cash flows consist
solely of payments of principal and interest on the
principal amount outstanding.
50
51
ATOMO ANNUAL REPORT FY22 In relation to the impairment of financial assets,
AASB 9 requires an expected credit loss model as
opposed to an incurred credit loss model under
AASB 139. The expected credit loss model requires
the Group to account for expected credit losses
and changes in those expected credit losses at
each reporting date to reflect changes in credit
risk since initial recognition of the financial assets.
Consequently, it is no longer necessary for a
credit event to have occurred before credit losses
are recognised.
The Group has one type of financial assets (trade
and other receivables) that are subject to AASB 9's
new expected credit loss model.
Financial liabilities are classified as measured at
amortised cost or FVTPL. A financial liability is
classified as at FVTPL if it is classified as held-for-
trading, it is a derivative or it is designated as such
on initial recognition. Financial liabilities at FVTPL
are measured at fair value and net gains and losses,
including any interest expense, are recognised
in profit or loss. Other financial liabilities are
subsequently measured at amortised cost using
the effective interest method. Interest expense and
foreign exchange gains and losses are recognised
in profit or loss. Any gain or loss on derecognition
is also recognised in profit or loss.
Apart from the above, the application of AASB
9 had no impact on the classification and
measurement of the Group's financial assets
and liabilities.
(s) Provisions
Provisions are recognised when the Group has a
present (legal or constructive) obligation as a result
of a past event, it is probable the consolidated
entity will be required to settle the obligation, and
a reliable estimate can be made of the amount
of the obligation. The amount recognised as a
provision is the best estimate of the consideration
required to settle the present obligation at the
reporting date, taking into account the risks and
uncertainties surrounding the obligation. If the
time value of money is material, provisions are
discounted using a current pre-tax rate specific
to the liability. The increase in the provision
resulting from the passage of time is recognised
as a finance cost.
(t) Employee benefits
Short-term employee benefits:
Liabilities for wages and salaries, including
non-monetary benefits, annual leave and long
service leave expected to be settled wholly within
12 months of the reporting date are measured
at the amounts expected to be paid when the
liabilities are settled.
Other long-term employee benefits:
The liability for annual leave and long service leave
not expected to be settled within 12 months of the
reporting date are measured at the present value of
expected future payments to be made in respect of
services provided by employees up to the reporting
date using the projected unit credit method.
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 corporate bonds with terms to maturity
and currency that match, as closely as possible,
the estimated future cash outflows.
Defined contribution superannuation
expense:
Contributions to defined contribution
superannuation plans are expensed in the
period in which they are incurred.
Share-based payments:
Equity-settled and cash-settled share-based
compensation benefits are provided to employees.
Equity-settled transactions are awards of shares,
or options over shares, that are provided to
employees in exchange for the rendering of
services. Cash-settled transactions are awards
of cash for the exchange of services, where the
amount of cash is determined by reference to
the share price.
The cost of equity-settled transactions are
measured at fair value on grant date. Fair value
is independently determined using either the
Binomial or Black-Scholes option pricing model
that takes into account the exercise price, the term
of the option, the impact of dilution, the share
price at grant date and expected price volatility of
the underlying share, the expected dividend yield
and the risk free interest rate for the term of the
option, together with non-vesting conditions that
do not determine whether the consolidated entity
receives the services that entitle the employees to
receive payment. No account is taken of any other
vesting conditions.
The cost of equity-settled transactions are
recognised as an expense with a corresponding
increase in equity over the vesting period. Where
early exercise has occurred, this cost is accelerated.
The cumulative charge to profit or loss is calculated
based on the grant date fair value of the award,
the best estimate of the number of awards that are
likely to vest and the expired portion of the vesting
period. The amount recognised in profit or loss for
the period is the cumulative amount calculated
at each reporting date less amounts already
recognised in previous periods.
The cost of cash-settled transactions is initially,
and at each reporting date until vested, determined
by applying either the Binomial or Black-Scholes
option pricing model, taking into consideration
the terms and conditions on which the award
was granted. The cumulative charge to profit or
loss until settlement of the liability is calculated
as follows:
• during the vesting period, the liability at each
reporting date is the fair value of the award at
that date multiplied by the expired portion of
the vesting period.
• from the end of the vesting period until
settlement of the award, the liability is the full
fair value of the liability at the reporting date.
All changes in the liability are recognised in
profit or loss. The ultimate cost of cash-settled
transactions is the cash paid to settle the liability.
Market conditions are taken into consideration
in determining fair value. Therefore any awards
subject to market conditions are considered to
vest irrespective of whether or not that market
condition has been met, provided all other
conditions are satisfied.
If equity-settled awards are modified, as a
minimum an expense is recognised as if the
modification has not been made. An additional
expense is recognised, over the remaining vesting
period, for any modification that increases the total
fair value of the share-based compensation benefit
as at the date of modification.
If the non-vesting condition is within the control
of the consolidated entity or employee, the failure
to satisfy the condition is treated as a cancellation.
If the condition is not within the control of the
consolidated entity or employee and is not
satisfied during the vesting period, any remaining
expense for the award is recognised over the
remaining vesting period, unless the award
is forfeited.
If equity-settled awards are cancelled, it is treated
as if it has vested on the date of cancellation, and
any remaining expense is recognised immediately.
If a new replacement award is substituted for the
cancelled award, the cancelled and new award is
treated as if they were a modification.
(u) Fair value measurement
When an asset or liability, financial or non-
financial, is measured at fair value for recognition
or disclosure purposes, the fair value is based on
the price that would be received to sell an asset or
paid to transfer a liability in an orderly transaction
between market participants at the measurement
date; and assumes that the transaction will
take place either: in the principal market; or in
the absence of a principal market, in the most
advantageous market.
Fair value is measured using the assumptions
that market participants would use when pricing
the asset or liability, assuming they act in their
economic best interests. For non-financial
assets, the fair value measurement is based on
its highest and best use. Valuation techniques
that are appropriate in the circumstances and for
which sufficient data are available to measure fair
value, are used, maximising the use of relevant
observable inputs and minimising the use of
unobservable inputs.
Assets and liabilities measured at fair value are
classified into three levels, using a fair value
hierarchy that reflects the significance of the inputs
used in making the measurements. Classifications
are reviewed at each reporting date and transfers
between levels are determined based on a
reassessment of the lowest level of input that is
significant to the fair value measurement.
For recurring and non-recurring fair value
measurements, external valuers may be used
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ATOMO ANNUAL REPORT FY22 when internal expertise is either not available or
when the valuation is deemed to be significant.
External valuers are selected based on market
knowledge and reputation. Where there is a
significant change in fair value of an asset or
liability from one period to another, an analysis is
undertaken, which includes a verification of the
major inputs applied in the latest valuation and
a comparison, where applicable, with external
sources of data.
(v) Issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue
of new shares or options are shown in equity as a
deduction, net of tax, from the proceeds.
(w) Dividends
Dividends are recognised when declared during the
financial year and no longer at the discretion of
the Company.
(x) Earnings per share
Basic earnings per share:
Basic earnings per share is calculated by dividing
the profit attributable to the owners of Atomo
Diagnostics Limited, excluding any costs of
servicing equity other than ordinary shares, by
the weighted average number of ordinary shares
outstanding during the financial year, adjusted for
bonus elements in ordinary shares issued during
the financial year.
Diluted earnings per share:
Diluted earnings per share adjusts the figures used
in the determination of basic earnings per share
to take into account the after income tax effect of
interest and other financing costs associated with
dilutive potential ordinary shares and the weighted
average number of shares assumed to have been
issued for no consideration in relation to dilutive
potential ordinary shares.
(y) Goods and Services Tax (‘GST’)
and other similar taxes
Revenues, expenses and assets are recognised net
of the amount of associated GST, unless the GST
incurred is not recoverable from the tax authority.
In this case it is recognised as part of the cost of the
acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive
of the amount of GST receivable or payable.
The net amount of GST recoverable from, or
payable to, the tax authority is included in other
receivables or other payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST
components of cash flows arising from investing
or financing activities which are recoverable from,
or payable to the tax authority, are presented as
operating cash flows.
Commitments and contingencies are disclosed net
of the amount of GST recoverable from, or payable
to, the tax authority.
(z) Rounding of amounts
The Company is of a kind referred to in
Corporations Instrument 2016/191, issued by the
Australian Securities and Investments Commission,
relating to 'rounding-off'. Amounts in this report
have been rounded off in accordance with that
Corporations Instrument to the nearest dollar.
Note 2: Critical accounting
judgements, estimates and
assumptions
The preparation of the financial statements
requires management to make judgements,
estimates and assumptions that affect the
reported amounts in the financial statements.
Management continually evaluates its judgements
and estimates in relation to assets, liabilities,
contingent liabilities, revenue and expenses.
Management bases its judgements, estimates and
assumptions on historical experience and on other
various factors, including expectations of future
events, management believes to be reasonable
under the circumstances. The resulting accounting
judgements and estimates will seldom equal the
related actual results. The judgements, estimates
and assumptions that have a significant risk of
causing a material adjustment to the carrying
amounts of assets and liabilities (refer to the
respective notes) within the next financial year
are discussed below.
Revenue recognition:
When recognising revenue in relation to the sale
of goods to customers, the key performance
obligation is considered to be the point the
customer obtains control of the goods as outlined
in the arrangement.
Share-based payment transactions:
The Group measures the cost of equity-settled
transactions with employees by reference to the
fair value of the equity instruments at the date at
which they are granted. The fair value of options
is determined by using the Black-Scholes model
taking into account the terms and conditions upon
which the instruments were granted and includes
assumptions which require judgement.
Allowance for expected credit losses:
The allowance for expected credit losses
assessment requires a degree of estimation and
judgement. It is based on the lifetime expected
credit loss, grouped based on days overdue, and
makes assumptions to allocate an overall expected
credit loss rate for each group. These assumptions
include recent sales experience and historical
collection rates.
Write-down of inventories:
Any write-down of inventories requires a degree of
estimation and judgement. The level of the write-
down is assessed by taking into account the recent
sales experience, the ageing of inventories and
other factors that affect inventory obsolescence.
Fair value measurement hierarchy:
The Group is required to classify all assets and
liabilities, measured at fair value, using a three level
hierarchy, based on the lowest level of input that
is significant to the entire fair value measurement,
being: Level 1: Quoted prices (unadjusted) in
active markets for identical assets or liabilities that
the entity can access at the measurement date;
Level 2: Inputs other than quoted prices included
within Level 1 that are observable for the asset
or liability, either directly or indirectly; and Level
3: Unobservable inputs for the asset or liability.
Considerable judgement is required to determine
what is significant to fair value and therefore
which category the asset or liability is placed in
can be subjective.
The fair value of assets and liabilities classified
as level 3 is determined by the use of valuation
models. These include discounted cash flow
analysis or the use of observable inputs that
require significant adjustments based on
unobservable inputs.
54
55
ATOMO ANNUAL REPORT FY22 Estimation of useful lives of assets:
The Group determines the estimated useful lives
and related depreciation and amortisation charges
for its property, plant and equipment and finite life
intangible assets. The useful lives could change
significantly as a result of technical innovations
or some other event. The depreciation and
amortisation charge will increase where the useful
lives are less than previously estimated lives, or
technically obsolete or non-strategic assets that
have been abandoned or sold will be written off or
written down.
Lease term
The lease term is a significant component in
the measurement of both the right-of-use asset
and lease liability. Judgement is exercised
in determining whether there is reasonable
certainty that an option to extend the lease or
purchase the underlying asset will be exercised,
or an option to terminate the lease will not be
exercised, when ascertaining the periods to be
included in the lease term. In determining the
lease term, all facts and circumstances that create
an economical incentive to exercise an extension
option, or not to exercise a termination option,
are considered at the lease commencement date.
Factors considered may include the importance of
the asset to the consolidated entity's operations;
comparison of terms and conditions to prevailing
market rates; incurrence of significant penalties;
existence of significant leasehold improvements;
and the costs and disruption to replace the asset.
The consolidated entity reassesses whether it is
reasonably certain to exercise an extension option,
or not exercise a termination option, if there is a
significant event or significant change
in circumstances.
Incremental borrowing rate
Where the interest rate implicit in a lease cannot
be readily determined, an incremental borrowing
rate is estimated to discount future lease payments
to measure the present value of the lease liability
at the lease commencement date. Such a rate is
based on what the consolidated entity estimates it
would have to pay a third party to borrow the funds
necessary to obtain an asset of a similar value to
the right-of-use asset, with similar terms, security
and economic environment.
Lease make good provision
A provision has been made for the present value
of anticipated costs for future restoration of
leased premises. The provision includes future
cost estimates associated with closure of the
premises. The calculation of this provision requires
assumptions such as application of closure dates
and cost estimates. The provision recognised for
each site is periodically reviewed and updated
based on the facts and circumstances available at
the time. Changes to the estimated future costs for
sites are recognised in the statement of financial
position by adjusting the asset and the provision.
Reductions in the provision that exceed the
carrying amount of the asset will be recognised in
profit or loss.
Employee benefits provision
As discussed in note 1, the liability for employee
benefits expected to be settled more than
12 months from the reporting date are recognised
and measured at the present value of the estimated
future cash flows to be made in respect of all
employees at the reporting date. In determining
the present value of the liability, estimates
of attrition.
Impairment of intangible assets:
The Group tests intangible assets for impairment
for each reporting period or more frequently if
events or changes in circumstances indicate it
has suffered any impairment, in accordance with
the accounting policy stated in Note 3(o). The
recoverable amount of a cash generating unit
("CGU") is determined based on value-in-use
calculations whereby cash flows are projected and
extrapolated over a five year period with growth
rates that do not exceed the long-term average
growth rate for the market in which the Group
operates. The discount rate used reflects the
Group's pre-tax weighted average cost of capital.
Note 3: Revenue and other income
Revenue:
Revenue from sale of goods
COVID-19
HIV
Other OEM
Other
Other income:
R&D tax rebate
R&D tax rebate overprovisioned in prior year
COVID-19 Government grants
License and settlement fees
Other income
Consolidated
2022
2021
10,416,675
1,799,271
-
120,165
12,336,111
1,029,205
-
-
1,656,202
-
2,685,407
3,664,613
1,082,528
1,942,878
25,640
6,715,659
754,676
(161,808)
108,588
-
112,770
814,226
Total revenue and other income
15,021,518
7,529,885
Note 4: Expenses
Loss before income tax from continuing
operations includes the following specific expenses:
(a)
Employee benefits expense
Salaries, wages and Directors’ fees
Contributions to superannuation
Equity-settled share-based payments
Other employment related expenses
(b)
Depreciation and amortisation expense
Depreciation expense (Note 9)
Amortisation expense (Note 11)
Right-of-use assets (Note 10)
(c)
Net finance income/(cost)
Interest income
Cash interest expense
Effective Interest Expense (Note 13)
Consolidated
2022
2021
3,210,355
3,141,315
263,815
201,029
427,217
267,779
293,386
110,614
4,102,416
3,813,094
1,390,540
487,992
118,873
1,997,405
5,456
-
(15,470)
(10,014)
884,690
319,396
114,241
1,318,327
90,697
(2,880)
(4,906)
82,911
56
57
ATOMO ANNUAL REPORT FY22
Note 5: Income tax
(a) Income tax benefit
Income tax benefit comprises current and deferred tax expense and is recognised in profit or loss, except
to the extent that it relates to a business combination or items recognised directly in equity or other
comprehensive income. The components of income tax benefit comprise:
Current tax
Deferred tax
Total income tax benefit
Consolidated
2022
2021
-
-
-
-
-
-
The prima facie tax on profit before income tax is reconciled to the income tax benefit as follows:
Loss before income tax
Tax using the Company’s domestic Australian tax rate of 26.0% (2021: 26%)
Permanent and temporary differences
Tax losses not brought to account
Total income tax benefit
(b) Deferred tax assets and liabilities
Consolidated
2022
2021
(5,706,854)
(6,021,215)
1,516,038
(480,166)
(1,035,872)
-
1,444,097
(1,093,633)
(350,464)
-
Due to the uncertainty of the Group generating sufficient taxable income to offset tax losses carried forward,
the future tax benefits of these losses, to the extent that they do not set off temporary differences that have
resulted in deferred tax liabilities, has not been brought to account in these financial statements.
Net tax effect of carried forward losses not brought to account
3,800,722
2,804,480
Note 6: Current assets – cash and cash equivalents
(a) Cash and cash equivalents in statement of cash flows
Cash at bank
(b) Reconciliation of cash flows from operating activities
Loss for the year
Adjustments for:
Depreciation and amortisation
Unrealised currency translation movements
Equity-settled share-based payment transactions
Finance costs
Operating profit before changes in working capital and provisions
Changes in working capital and provisions:
Decrease in trade and other receivables
Decrease in trade and other payables
Increase in inventories
Increase in employee benefits
Consolidated
2022
2021
12,966,400
12,966,400
17,946,517
17,946,517
(5,706,854)
(6,021,215)
1,997,405
1,318,327
48,944
201,029
15,470
255,522
293,386
-
2,262,848
1,867,235
(3,444,006)
(4,153,980)
1,712,120
(731,853)
(377,152)
34,249
637,364
1,369,989
359,024
(1,832,569)
32,285
(71,271)
Net cash from operating activities
(2,806,642)
(4,225,251)
Note 7: Current assets – trade and other receivables
Receivables from trade customers
Expected credit loss/bad debt provision
R&D Tax Rebate Receivable
Other receivables
Consolidated
2022
2021
975,854
(56,884)
1,171,954
587,182
2,678,106
1,934,717
(70,433)
1,823,828
806,256
4,494,368
58
59
ATOMO ANNUAL REPORT FY22
Note 7: Current assets – trade and other receivables (continued)
Note 9: Non-current assets – property, plant and equipment (continued)
Allowance for expected credit losses:
Reconciliations:
The Group monitors its level of debt recovery at each reporting date (including interim reporting dates)
in order to assess for any changes in the probability of customers’ ability to pay, including due to external
factors such as the COVID-19 pandemic.
The ageing of receivables from trade customers and allowance for expected credit losses provide for above
are as follows:
Consolidated – 2022
0 to 30
Days
31 to 60
Days
61 to 90
Days
91 to 120
Days
121+
Days
Total
Trade receivables
621,507
172,178
12,586
Allowance for expected credit losses
(8,128)
(6)
(378)
Carrying value of trade receivables before
additional bad debt provisions
613,379
172,172
12,208
-
-
-
169,583
975,854
(48,372)
(56,884)
121,211
918,970
Note 8: Current assets – inventories
Raw material
Raw materials provision
Work in progress
Work in progress provision
Finished goods
Finished goods provision
Consolidated
2022
2021
1,924,952
1,809,489
(23,541)
58,349
(24,871)
1,485,758
-
3,420,647
(8,247)
130,498
-
1,309,497
(198,992)
3,042,245
Note 9: Non-current assets – property, plant and equipment
Reconciliations of the written down values at the beginning and end of the current and previous financial
year are set out below:
Consolidated
Balance at 1 July 2020
Additions
Depreciation expense
Balance at 30 June 2021
Balance at 1 July 2021
Additions
Depreciation expense
Balance at 30 June 2022
Note 10: Non-current assets – right-of-use assets
Land and buildings – right-of-use (Note 13)
Less: Accumulated depreciation (Note 13)
Plant and equipment – right-of-use (Note 13)
Less: Accumulated depreciation (Note 13)
Total right-of-use assets
Plant and
equipment
1,452,598
3,091,543
(881,164)
3,662,977
3,662,977
1,392,793
(1,390,540)
3,665,230
Total
1,452,598
3,091,543
(881,164)
3,662,977
3,662,977
1,392,793
(1,390,540)
3,665,230
Consolidated
2022
2021
436,930
(123,767)
313,163
14,493
(10,870)
3,623
316,786
68,136
(8,517)
59,619
14,493
(7,247)
7,246
66,865
Plant and equipment – at cost
Less: Accumulated depreciation
Total plant and equipment
Total property, plant and equipment
Consolidated
2022
2021
7,534,920
6,142,127
(3,869,690)
(2,479,150)
3,665,230
3,662,977
3,665,230
3,662,977
The Company entered into a new lease prior to 30 June 2021 which commenced in September 2021.
Upon commencement, a lease liability in the amount of $320,711 was recognised along with a
corresponding right-of-use asset.
The Group leases land and buildings for its offices in Sydney Australia and warehouse in South Africa under
agreements of between one (1) to three (3) years with, in some cases, options to extend, which have not
been taken up. The Group also leases a single piece of office equipment under a five (5) year agreement.
60
61
ATOMO ANNUAL REPORT FY22
Note 11: Non-current assets – intangible assets
Note 12: Current liabilities – trade and other payables
Patents and trademarks – at cost
Less: accumulated amortisation
Total patents and trademarks
Product development assets – at cost
Less: accumulated amortisation
Total product development assets
Other intangibles – at cost
Less: accumulated amortisation
Total other intangibles
Total intangible assets
Reconciliations:
Consolidated
2022
2021
1,627,443
(668,822)
958,621
2,909,418
(706,905)
2,202,513
492,902
(79,346)
413,556
1,555,258
(598,715)
956,543
2,317,974
(291,428)
2,026,546
119,683
(76,938)
42,745
3,574,690
3,025,834
Reconciliations of the written down values at the beginning and end of the current and previous financial
year are set out below:
Consolidated
Balance at 1 July 2020
Additions
Amortisation expense
Capitalisation of R&D rebate
Reversal of over-accrued capitalised
R&D rebate from prior year
Capitalised R&D rebate recognised
as income
Patents and
trademarks
Product devel-
opment costs
Other
intangibles
913,060
106,034
(62,551)
-
-
-
584,995
2,671,740
(254,583)
(1,162,207)
93,546
93,055
20,279
28,254
(5,788)
-
-
-
Total
1,518,334
2,806,028
(322,922)
(1,162,207)
93,546
93,055
Balance at 30 June 2021
956,543
2,026,546
42,745
3,025,834
Balance at 1 July 2021
Additions
Amortisation expense
Capitalisation of R&D rebate
Capitalised R&D rebate recognised
as income
956,543
72,185
(70,107)
-
-
2,026,546
734,193
(415,477)
(319,374)
176,625
42,745
373,219
(2,408)
-
-
3,025,834
1,179,597
(487,992)
(319,374)
176,625
Balance at 30 June 2022
958,621
2,202,513
413,556
3,574,690
Trade payables
Accrued expenses
Other payables
Consolidated
2022
2021
378,262
627,986
76,964
654,502
825,188
304,268
1,083,212
1,783,958
All amounts are short term and the carrying values are considered to be a reasonable approximation of
fair value.
Note 13: Lease liabilities
Current:
Lease liabilities (Note 10)
Non-current:
Lease liabilities (Note 10)
Total lease liabilities
Please refer to Note 10 for further details on leases entered into.
Note 14: Provisions
Current:
Liability for annual leave
Liability for long service leave
Non-current:
Liability for long service leave
Make good provision
Consolidated
2022
2021
155,926
155,926
184,879
184,879
340,805
67,589
67,589
-
-
67,589
Consolidated
2022
2021
211,167
79,991
291,158
42,970
50,000
92,970
204,561
72,243
276,804
23,074
-
23,074
Total provisions
384,128
299,878
The current provision for employee benefits includes all unconditional entitlements where employees have
completed the required period of service and also those where employees are entitled to pro-rata payments
in certain circumstances. The entire amount is presented as current since the consolidated entity does not
have an unconditional right to defer settlement.
Make good provision recognised in the current period in respect of new lease as per Note 10 and Note 13.
62
63
ATOMO ANNUAL REPORT FY22
Note 15: Equity – issued capital
Movements in ordinary share capital:
Ordinary Shares
Total
2022
2021
2022
2021
Number of shares:
On issue as at 1 July
568,597,807
561,077,807
568,597,807
561,077,807
Issue of Shares Under Employee Share Plan
-
320,000
-
320,000
Exercise of Options
On issue as at 30 June
Value ($):
On issue as at 1 July
Issue of Shares Under Employee Share Plan
Exercise of Options
Costs Associated with the Issues of Shares
2,293,184
7,200,000
2,293,184
7,200,000
570,890,991
568,597,807
570,890,991
568,597,807
67,921,661
66,514,571
67,921,661
66,514,571
-
116,426
(1,250)
108,000
1,311,482
(12,392)
-
108,000
116,426
(1,250)
1,311,482
(12,392)
Note 16: Equity – reserves
Foreign currency translation reserve
Share based payment reserve
Consolidated
2022
2021
(63,078)
866,426
803,348
(227,690)
713,027
485,337
Foreign currency translation reserve:
This reserve is used to recognise exchange differences arising from the translation of the financial
statements of foreign operations to Australian dollars and the effect of permanent loans with foreign
operations within the Group.
Share based payment reserve:
This reserve is used to recognise the fair value of equity-settled share-based payments where they relate
to yet-to-be exercised options.
On issue as at 30 June
68,036,837
67,921,661
68,036,837
67,921,661
Movements in reserves:
Ordinary shares:
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the
company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary
shares have no par value and the company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and
upon a poll each share shall have one vote.
Capital risk management:
The Group's objectives when managing capital is to safeguard its ability to continue as a going concern, so
that it can provide returns for shareholders and benefits for other stakeholders, maintain sufficient financial
flexibility to pursue its growth objectives and to maintain an optimum capital structure to reduce the cost
of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net
debt is calculated as total borrowings less cash and cash equivalents.
In order to maintain or adjust the capital structure, the Group may take one of several actions which may
include the issue of new shares, the payment of dividends, a return capital to shareholders, or sell assets to
reduce debt. The Group is not actively pursuing or considering any of these options at the time of this report.
The Company may look to raise capital when an opportunity to invest in a business or company was seen as
value adding relative to the current Company's share price at the time of the investment. The Group is not
actively pursuing additional investments in the short term as it continues to grow its existing businesses.
The Group currently has no debt and is not subject to any finance arrangement covenants.
Movements in each class of reserve during the current and previous financial year are set out below:
Consolidated
Balance at 1 July 2020
Equity-settled share-based payments
Exercise of options
Lapsed and Cancelled Options
Foreign currency translation
Balance at 30 June 2021
Balance at 1 July 2021
Equity-settled share-based payments
Exercise of options
Foreign currency translation
Balance at 30 June 2022
Foreign
currency
Share based
payment
(451,342)
-
-
-
223,652
(227,690)
(227,690)
-
-
164,612
(63,078)
746,970
320,951
(188,373)
(166,521)
-
713,027
713,027
201,029
(47,630)
-
866,426
Total
295,628
320,951
(188,373)
(166,521)
223,652
485,337
485,337
201,029
(47,630)
164,612
803,348
Note 17: Equity – dividends
No dividends were paid or declared during the financial year (2021: Nil).
Franking credits:
Franking credits available for subsequent financial years
-
-
Consolidated
2022
2021
64
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ATOMO ANNUAL REPORT FY22
Note 18: Financial risk management
Financial risk management objectives
The Group's activities expose it to a variety of financial risks including market risk (including foreign
currency risk, price risk and interest rate risk), credit risk and liquidity risk. The Group's overall risk
management objectives seek to minimise potential adverse effects on the financial performance of the
Group. The Group uses different methods to measure different types of risk to which it is exposed. These
methods include sensitivity analysis in the case of interest rate, foreign exchange and other price risks,
ageing analysis for credit risk and beta analysis in respect of investment portfolios to determine market risk.
Risk management is carried out by senior finance executives ('finance') under policies approved by the
Board of Directors ('the Board'). These policies include identification and analysis of the risk exposure of the
Group and appropriate procedures, controls and risk limits. Finance identifies and evaluates financial risks
within the Group. Finance reports to the Board on a monthly basis.
Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because
of changes in market prices, such as foreign exchange rates and interest rates. The objective of market
risk management is to manage and control market risk exposures within acceptable parameters, while
optimising the return.
Foreign currency risk
The consolidated entity undertakes certain transactions denominated in foreign currency and is exposed
to foreign currency risk through foreign exchange rate fluctuations.
Foreign exchange risk arises from future commercial transactions and recognised financial assets and
financial liabilities denominated in a currency that is not the entity's functional currency. The risk is
measured using sensitivity analysis and cash flow forecasting.
The carrying amount of the consolidated entity's foreign currency denominated financial assets and
financial liabilities at the reporting date were as follows:
Consolidated
2022
2021
2022
2021
Assets
Liabilities
US Dollars
British Pounds
South African Rand
EURO
Swiss Franc
136,504
22,025
932,485
-
-
2,693,426
4,455
491,346
-
-
1,091,014
3,189,227
7,711
8,981
25,978
53,974
-
96,644
240,296
11,163
33,990
-
14,420
299,869
Note 18: Financial risk management (continued)
Reasonably possible movements in the Australian dollar against all other currencies as at 30 June 2022
would have affected the measurement of financial instruments denominated in a foreign currency and
affected profit or loss and equity by the amounts shown below. This analysis assumes that all other
variables remain constant and ignores any impact of forecast sales and purchases:
Consolidated
AUD Strengthening by 10%
AUD Weakening by 10%
Price risk
Profit Before Tax
Equity
2022
2021
2022
2021
(90,397)
110,486
(262,669)
321,040
(90,397)
110,486
(262,669)
321,040
The Group is not exposed to any significant price risk.
Interest rate risk
As at 30 June 2022, the Group was not exposed to any significant interest rate risk. There is minimal
exposure to the impact of adverse changes in benchmark interest rates.
The Group was exposed to variable interest rate risks on cash and short-term deposits. A reasonably
possible change of 100 basis points in interest rates during the year would have increased or decreased
profit before tax by $119,561 (2021: $198,794). This analysis assumes that all other variables remain
constant.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in
financial loss to the Group. The Group has a code of credit, including undertaking customer due diligence,
confirming references and setting appropriate credit limits as appropriate. The maximum exposure to
credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions
for impairment of those assets, as disclosed in the statement of financial position and notes to the
financial statements.
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators
of this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a
failure to make contractual payments for a period greater than 1 year.
66
67
ATOMO ANNUAL REPORT FY22 Note 18: Financial risk management (continued)
Note 19: Remuneration of auditors
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with
its financial liabilities that are settled by delivering cash or another financial asset. The Group manages
liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously
monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and
liabilities.
Financing arrangements:
The Group has no used or unused financing facilities in place as at 30 June 2022 (2021: Nil).
Remaining contractual maturities:
The following tables detail the Group’s remaining contractual maturity for its financial instrument liabilities.
The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the
earliest date on which the financial liabilities are required to be paid. The tables include both interest and
principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ
from their carrying amount in the statement of financial position.
Consolidated – 2022
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Interest-bearing
Lease liabilities
Total non-derivatives
Consolidated – 2021
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Interest-bearing
Lease liabilities
Total non-derivatives
Weighted
average
interest
rate
1 year or
less
Between 1
and 2 years
Between 2
and 5 years
Over 5
years
Remaining
contractual
maturities
-
-
378,262
704,950
-
-
-
-
5.18%
169,517
1,252,729
142,985
142,985
48,205
48,205
-
-
-
-
-
-
-
-
Weighted
average
interest
rate
1 year or
less
Between 1
and 2 years
Between 2
and 5 years
Over 5
years
Remaining
contractual
maturities
-
-
654,502
1,129,456
7.00%
67,589
1,851,547
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
The cash flows in the maturity analysis above are not expected to occur significantly earlier than
contractually disclosed above.
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
During the financial year the following fees were paid or payable for services provided by the Company’s
auditors, their network firms and unrelated firms:
Audit and assurance services:
BDO Australia:
Audit and review of financial statements
Total audit and assurance services
Other services:
BDO Australia:
Tax advisory services
Other services
Total other services
Consolidated
2022
2021
88,000
88,000
11,755
52,416
64,171
81,000
81,000
30,000
11,442
41,442
Total auditors’ remuneration
152,171
122,442
Note 20: Contingent assets
There were no contingent assets as at 30 June 2022.
Note 21: Contingent liabilities
There were no contingent liabilities as at 30 June 2022.
Note 22: Commitments
Capital commitments
Committed at the reporting date but not recognised as liabilities payable:
Plant and equipment and intangibles
-
2,189,174
Consolidated
2022
2021
Other commitments
Inventory
Lease liabilities
Total commitments
145,060
-
145,060
1,037,221
320,711
3,547,106
Inventory commitments relate to volumes of devices committed to be purchased throughout the year for
sale to customers.
Capital commitments relate to the expansion of manufacturing capacity to support growth. Plant and
equipment to be purchased includes additional tooling, assembly lines and associated machinery to
support increased production of Atomo’s suite of devices.
Lease liabilities relate to a new lease which the Company entered into prior to 30 June 2021 but which
did not commence until September 2021. Upon commencement, a lease liability in the amount of $320,711
was recognised along with a corresponding right-of-use asset.
68
69
ATOMO ANNUAL REPORT FY22 Note 23: Related party transactions
Parent entity:
Atomo Diagnostics Limited is the Parent Entity.
Subsidiaries:
Interests in subsidiaries are set out in Note 25.
Key management personnel compensation:
The aggregate compensation made to Directors and other members of key management personnel of the
Group is set out below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Total key management personnel compensation
Consolidated
2022
2021
1,469,556
1,655,322
82,372
13,595
79,905
1,645,428
68,538
7,881
(67,169)
1,664,572
Further details relating to key management personnel compensation are set out in the remuneration report
included in the Directors’ report.
Transactions with other related parties:
There were no other transactions between related parties during the year (2021: Nil)
Key management personnel transactions:
Directors and other key management personnel hold 26.1% of the issued capital of the company as at
30 June 2022 (30 June 2021: 26.4%).
Note 24: Parent entity information
Set out below is the supplementary information about the Parent Entity.
Statement of profit or loss and other comprehensive income
Loss for the year
Other comprehensive income
Total comprehensive income
Statement of financial position
Assets
Total current assets
Total non-current assets
Total assets
Liabilities
Total current liabilities
Total non-current liabilities
Total liabilities
Total net assets
Equity
Share capital
Share based payment reserve
Retained earnings
Total equity
Parent
2022
2021
(15,708,461)
(11,982,954)
-
-
(15,708,461)
(11,982,954)
Parent
2022
2021
15,087,005
7,895,767
22,982,772
1,555,247
277,848
1,833,095
24,096,206
7,031,323
31,127,529
2,059,279
23,074
2,082,353
21,149,677
29,045,176
68,036,837
67,921,661
866,426
713,027
(47,753,586)
(39,589,512)
21,149,677
29,045,176
Guarantees entered into by the Parent Entity in relation to the debts of its subsidiaries
None.
Contingent liabilities
There were no contingent liabilities attributed to the parent entity as at 30 June 2022 (2021: Nil).
70
71
ATOMO ANNUAL REPORT FY22 Note 24: Parent entity information (continued)
Note 25: Interests in subsidiaries
Commitments
Capital commitments
Committed at the reporting date but not recognised as liabilities payable:
Plant and equipment and intangibles
-
2,106,035
Consolidated
2022
2021
Other commitments
Inventory
Lease liabilities
Total commitments
145,060
-
1,037,221
320,711
145,060
3,463,967
Inventory commitments relate to volumes of devices committed to be purchased throughout the year
for sale to customers.
Capital commitments relate to the expansion of manufacturing capacity to support growth. Plant and
equipment to be purchased includes additional tooling, assembly lines and associated machinery to
support increased production of Atomo’s suite of devices.
Lease liabilities relate to a new lease which the Company entered into prior to 30 June 2021 but which
does not commence until September 2021. Upon commencement, a lease liablity in the amount of
$320,711 will be recognised along with a corresponding right-of-use asset.
Significant accounting policies
The accounting policies of the Parent Entity are consistent with those of the consolidated entity, as
disclosed in Note 1, except for the following:
• Investments in subsidiaries are accounted for at cost, less any impairment, in the Parent Entity.
• Dividends received from subsidiaries are recognised as other income by the Parent Entity
and its receipt may be an indicator of an impairment of the investment.
The consolidated financial statements incorporate the assets, liabilities and results of the following wholly-
owned subsidiaries andbranch operations in accordance with the accounting policy described in Note 1:
Name
Parent entity:
Atomo Diagnostics Limited
Subsidiaries:
Atomo Australia Pty Limited
Atomo Limited
Atomo US Inc.
Atomo Operations US LLC
Branch operations:
Atomo South Africa
(operating branch of Atomo Australia Pty Limited)
Principal
place of business/
Country of
incorporation
Ownership
interest
2022
%
2021
%
Australia
Australia
United Kingdom
United States
United States
100%
100%
100%
100%
100%
100%
n/a
n/a
South Africa
100%
100%
Note 26: Events after the reporting period
• 1,733,335 options issued to executives under the Company’s Post-IPO options plan lapsed
as the KPIs applicable to the options were not satisfied with respect to the year ended
30 June 2022.
• The Board has exercised its discretion to allocate 1,199,999 options to executives under the Company's
post-IPO option plan to reward the diligent execution of the corporate strategy and to ensure retention
of the key talent needed to deliver strategic outcomes in the interest of shareholders.
No other matter or circumstance has arisen since 30 June 2022 that has significantly affected, or may
significantly affect the consolidated entity's operations, the results of those operations, or the
consolidated entity's state of affairs in future financial years.
72
73
ATOMO ANNUAL REPORT FY22
Note 27: Earnings per share
Consolidated
2022
2021
Note 28: Share-based payments
Set out below are summaries of options granted:
2022
Loss after income tax attributable to the owners of Atomo Diagnostics Limited
(5,706,854)
(6,021,215)
Loss after income tax attributable to the owners of Atomo Diagnostics Limited
used in calculating diluted earnings per share
(5,706,854)
(6,021,215)
Grant date
Note
Expiry date
Exercise
price
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
Basic earnings per share
Diluted earnings per share
Weighted average number of ordinary shares:
Weighted average number of ordinary shares used in calculating basic
earnings per share
Adjustments for calculation of diluted earnings per share:
Cents
(1.003)
(1.003)
Cents
(1.067)
(1.067)
Number
Number
568,949,638
564,334,355
No adjustments given that in a loss situation, this would be anti-dilutive
-
-
Weighted average number of ordinary shares used in calculating diluted
earnings per share
568,949,638
564,334,355
21/11/2012
6/04/2018
11/04/2019
14/04/2020
14/04/2020
14/04/2020
31/05/2021
31/05/2021
28(a)
28(a)
28(a)
28(b)
28(b)
28(b)
28(c)
28(c)
14/04/2022
06/04/2022
11/04/2023
14/04/2024
14/04/2025
14/04/2026
30/04/2024
30/04/2024
$0.03
$0.16
$0.16
$0.25
$0.25
$0.25
$0.40
$0.60
2,293,184
6,800,000
4,800,000
-
-
-
533,333
1,079,999
2,266,666
2,266,668
2,000,000
2,000,000
-
-
-
-
(2,293,184)
-
-
-
(6,800,000)
-
-
4,800,000
1,613,332
(1,733,335)
533,331
-
-
-
2,266,668
2,000,000
2,000,000
-
-
-
-
-
-
-
Weighted average exercise price
$0.23
$0.25
$0.03
$0.18
Weighted average remaining contractual life (years)
$0.29
1.8
22,959,851
1,079,999
(2,293,184)
(8,533,335)
13,213,331
2021
Grant date
Note
Expiry date
Exercise
price
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
21/11/2012
24/11/2016
6/04/2017
6/04/2018
15/09/2018
11/04/2019
14/04/2020
14/04/2020
14/04/2020
31/05/2021
31/05/2021
28(a)
28(a)
28(a)
28(a)
28(a)
28(a)
28(b)
28(b)
28(b)
28(c)
28(c)
14/04/2022
24/11/2020
6/04/2021
6/04/2022
15/09/2022
11/04/2023
14/04/2024
14/04/2025
14/04/2026
30/04/2024
30/04/2024
$0.03
$0.16
$0.16
$0.16
$0.16
$0.16
$0.25
$0.25
$0.25
$0.40
$0.60
2,293,184
5,000,000
3,600,000
6,800,000
800,000
4,800,000
2,799,999
2,799,999
2,800,002
-
-
-
-
-
-
-
-
-
-
-
2,000,000
2,000,000
-
-
2,293,184
(4,000,000)
(1,000,000)
(2,400,000)
(1,200,000)
-
-
-
(800,000)
-
-
-
-
-
-
-
-
-
6,800,000
-
4,800,000
(2,266,666)
533,333
(533,333)
2,266,666
(533,334)
2,266,668
-
-
2,000,000
2,000,000
31,693,184
4,000,000
(7,200,000)
(5,533,333)
22,959,851
Weighted average exercise price
$0.17
$0.50
$0.16
$0.21
Weighted average remaining contractual life (years)
$0.23
2.1
74
75
ATOMO ANNUAL REPORT FY22
(a) Pre-IPO Options
(c) Other Options
During the prior financial year, the Company issued 4,000,000 new options to Bondi Partners as part of Bondi
Partners' appointment to assist with the development and execution of its US go-to-market strategy and
commercial engagements across both private and public sectors as announced to the ASX on 30 April 2021.
Tranche 1 (2,000,000 options) issued to Bondi Partners on 31 May 2021 were fully vested on 31 October 2022.
These options are exercisable at an exercise price of $0.40 per option and expire on 30 April 2024.
Tranche 2 (2,000,000 options) are exercisable at $0.60, were fully vested on 30 April 2022 and expire on
30 April 2024.
The Company has adopted the 'Black-Scholes' option model to determine the fair value of these options.
The valuation model inputs used to determine the fair value at the grant date, are as follows:
Grant date
Expiry date
Share price
at grant
date
Exercise
price
Expected
volatility
Dividend
yield
Risk-free
interest rate
Fair value
at grant
date
31/05/2021
30/04/2024
31/05/2021
30/04/2024
$0.22
$0.22
$0.40
$0.60
60.00%
60.00%
0.00%
0.00%
0.25%
0.25%
$0.051
$0.031
In estimating the expected volatility, management relied on historical volatility trends applicable to the
Company's shares. Accordingly, the expected volatility used to assess the fair value of options may not
necessarily be indicative of the actual volatility of Atomo's shares over the exercise period(s).
In prior financial years, the Company issued options to employees, directors and key stakeholders to
align the interests of those parties through the sharing of a personal interest in the future growth and
development of the Company and to provide a means of attracting and retaining skilled and experienced
eligible persons.
All options were granted over unissued fully paid ordinary shares in the Company. Options granted carry
no dividend or voting rights.
(b) Post-IPO Options
Shortly prior to being listed on the ASX, the Company established a new employee option plan to align the
interests of eligible employees and Directors with shareholders through the sharing of a personal interest
in the future growth and development of the Company and to provide a means of attracting and retaining
skilled and experienced eligible persons.
Upon Atomo’s admission to the official list of ASX, Atomo granted a total of 8,400,000 options under the
post-IPO option plan to the four (4) executive KMPs exercisable at $0.25 within thirty six (36) months from
the date of vesting. The options vest in three equal tranches in 12 months, 24 months and 36 months
respectively, subject to the satisfaction of vesting conditions relating to KPIs determined by the Managing
Director or in the case of the Managing Director, determined by the Board in consultation with the People,
Culture and Remuneration Committee as follows:
KPI 1: ROI Hurdle
15% per annum calculated using the following formula:
Change in EBITDA year on year/amount invested in operating assets during the year.
KPI 2: Revenue Hurdle
Tranche 1/FY21 – Revenue growth of 60%
Tranche 2/FY22 – Revenue growth of 40%
Tranche 3/FY23 – Revenue growth of 25%
In addition, KPIs with respect to an additional 1,733,335 options with an expiry date of 14 April 2025 were
not satisfied and have subsequently lapsed. Accordingly, as at the date of this report, the Company had on
issue 2,813,331 options to KMPs under the post-IPO option plan.
In addition, subsequent to 30 June 2022, the Board has exercised its discretion to allocate the following new
options to management as part of the Company's remuneration scheme to reward the diligent execution of
the corporate strategy and to ensure retention of the key talent needed to deliver strategic outcome in the
interest of shareholders:
John Kelly
666,666 options
William Souter
533,333 options
Total
1,199,999 options
These options are exercisable at $0.25 per option and expire on 14 April 2025. In addition, these options
are conditional upon the executive remaining employed by the Company and in the case of John Kelly,
on Shareholder approval of the allocation.
76
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ATOMO ANNUAL REPORT FY22 ATOMO ANNUAL REPORT FY22
1 1 DIRECTORS' DECLARATION
DIRECTOR’S DECLARATION
In the Directors’ opinion:
• the attached financial statements and notes comply with the Corporations Act 2001, the Accounting
Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;
• the attached financial statements and notes comply with International Financial Reporting Standards as
issued by the International Accounting Standards Board as described in note 1 to the financial statements;
• the attached financial statements and notes give a true and fair view of the consolidated entity’s financial
position as at 30 June 2022 and of its performance for the financial year ended on that date; and
• there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations
Act 2001.
On behalf of the Directors:
John Keith
Chair
25 August 2022
Sydney
78
78
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ATOMO ANNUAL REPORT FY22 ATOMO ANNUAL REPORT FY22
1 2 INDEPENDENT AUDITOR'S REPORT
INDEPENDENT AUDITOR’S REPORT
To the members of Atomo Diagnostics Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Atomo Diagnostics Limited (the Company) and its subsidiaries
(the Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the
financial report, 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:
(i) Giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its financial
performance for the year ended on that date; and
(ii) 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 Corporations Act 2001 and the ethical
requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit
of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance
with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given
to the Directors of the Company, would be in the same terms if given to the Directors as at the time of this
auditor’s report.
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 judgement, were of most significance in our
audit of the financial report of the current period. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities which are all members of BDO
Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit Pty Ltd and BDO Australia Ltd are members
of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member
firms. Liability limited by a scheme approved under Professional Standards Legislation.
80
80
81
ATOMO ANNUAL REPORT FY22
Revenue recognition
Key audit matter
How the matter was addressed in our audit
As disclosed in Note 3, the Group recognised
revenue of $12,336,111 for the year ended 30 June
2022. Revenue was identified as a key audit matter
as it is a key performance indicator to the users of
the financial report.
Our procedures, amongst others, include:
- Reviewed whether the revenue recognition policies are in
accordance with Australian Accounting Standards and the
Group’s accounting policies described in Note 1;
- Substantive testing around year end to ensure revenue is
correctly recorded in the period to which it relates;
- Performed controls testing around the process in place for
revenue transactions;
- Performed analytical procedures on material revenue
streams and compared them against expectations; and
- Selected a sample of revenue transactions during the
year and substantively test to ensure revenue has been
appropriately reflected in the financial statements for the
year ended 30 June 2022.
Carrying Value of Intangible Assets
Key audit matter
How the matter was addressed in our audit
As at 30 June 2022, the Group recognised intangible
assets with a carrying value of $3,574,690 as
disclosed in Note 11.
The valuation of intangible assets is significant to
our audit because of the significant value in the
Statement of Financial Position and the significant
judgement required by management in assessing
recoverability.
The Group has determined the recoverable amount
through a value-in-use calculation for the cash
generating unit. This process is judgmental and
based on management’s assumptions, specifically
those in relation to growth rates, estimated
expenditure and discount rates, which are affected
by current and future markets.
Our procedures, amongst others, include:
- Obtained management’s value-in-use model and
assessment of impairment;
- Critically assessed the valuation and impairment analysis
completed by management, including the reasonableness
of the assumptions and estimates used to determine the
recoverable amount of its intangible assets;
- Together with BDO valuation specialists, assessed
the reasonableness of the discount rates applied by
management;
- Where appropriate, considered the accuracy of the Group’s
historical cash flow forecasts; and
- Evaluated the sensitivity analysis applied to the discounted
cash flow model to assess whether changes in the key
assumptions would impact the recoverable amount of the
intangible assets.
Other information
The Directors are responsible for the other information. The other information comprises the information in
the Group’s annual report for the year ended 30 June 2022, but does not include the financial report and the
auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial report or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The Directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the Directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the Directors either intend to liquidate the Group or to cease operations,
or has 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.
A further description of our responsibilities for the audit of the financial report is located at the Auditing
and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx)
at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the Directors’ report for the year ended 30 June 2022.
In our opinion, the Remuneration Report of Atomo Diagnostics Limited, for the year ended 30 June 2022,
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.
BDO Audit Pty Ltd
Gareth Few
Director
25 August 2022
Sydney
82
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ATOMO ANNUAL REPORT FY22 ATOMO ANNUAL REPORT FY22
1 3 SHAREHOLDER INFORMATION
The shareholder information set out below was applicable as at 31 August 2022.
Number of security holders
At the specified date, there were 8,387 holders of ordinary shares (quoted and unquoted) and 10 holders
of options (unquoted) over ordinary shares. These were the only classes of equity securities on issue.
DISTRIBUTION OF EQUITABLE SECURITIES
Analysis of number of equitable security holders by size of holding:
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Total
Number
of holders
297
3,452
1,504
2,662
472
8,387
Number
of shares
186,186
9,371,629
12,192,195
88,421,255
460,719,726
570,890,991
EQUITY SECURITY HOLDERS
Twenty largest holders of quoted ordinary shares
The names of the twenty largest holders of quoted ordinary shares are listed below:
Dalraida Holdings Pty Limited
Global Health Investment Fund
Walker Group Holdings Pty Ltd
Hsbc Custody Nominees
J P Morgan Nominees Australia
Grand Challenges Canada
Liverbird Pty Ltd
Mr Xiaoyi Lin
Mark Andrew Smith
I D E Pty Ltd
Mr Ian Fredrick Johnson
John Michael Kelly
Leo James Lynch & Judith Anne Beswick
Australia North Holdings Pty
Citicorp Nominees Pty Limited
Ruth Karen Devney
H & L Management Pty Ltd
Sokolov Pty Ltd
Rue Des Rocs Pty Ltd
GZ Family Holdings Pty Ltd
Total top 20 shareholders
Ordinary shares
Number held
% of total
share issued
65,120,000
64,811,280
37,660,718
16,426,792
14,768,406
11,390,824
10,931,653
9,500,000
7,790,224
7,542,816
7,506,080
7,370,248
7,321,121
6,500,000
5,923,014
5,626,408
4,050,000
4,031,888
3,735,843
3,448,616
11.41
11.35
6.60
2.88
2.59
2.00
1.91
1.66
1.36
1.32
1.31
1.29
1.28
1.14
1.04
0.99
0.71
0.71
0.65
0.60
301,455,931
52.80
84
84
85
ATOMO ANNUAL REPORT FY22 VOTING RIGHTS
The voting rights attached to ordinary shares are set out below:
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and
upon a poll each share shall have one vote.
There are no other classes of equity securities.
UNMARKETABLE PARCELS
There are 4,393 holders of an unmarketable parcel of shares based on the closing market price of $0.065
at the specified date.
OTHER ASX REQUIRED INFORMATION
During the period between admission to the Official List of ASX and the end of the reporting period, the
Company used the cash and assets in a form readily convertible to cash that it had at the time of admission
to the ASX, in a way consistent with its business objectives. This statement is made pursuant to ASX Listing
Rule 4.10.19.
SUBSTANTIAL HOLDERS*
Substantial holders in the company as disclosed in substantial holding notices given to the Company
are set out below:
John Kelly
Global Health Investment Fund LLC
Walker Group Holdings Pty Ltd
Ellerston Capital Limited
Total substantial shareholders
* Based on substantial holder notices lodged
Ordinary shares
Number
held
% of total
shares issued
72,490,248
64,811,280
37,660,718
42,736,544
217,698,790
12.70
11.35
6.60
7.49
38.14
UNQUOTED RESTRICTED SECURITIES
There are no unquoted restricted ordinary shares securities and unquoted options over ordinary shares
as at 31 August 2022.
OPTION HOLDING DISTRIBUTION
Size of option holding
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Total
Number
of holders
Number
of options
% of Issued
Options
-
-
-
-
10
10
-
-
-
-
13,746,664
13,746,664
-
-
-
-
100
100
UNQUOTED OPTIONS OVER ORDINARY SHARES
There were 13,746,664 unquoted options over ordinary shares on issue as follows:
Unquoted options – description
Options exercisable at 0.15625 expiring 11 Apr 2023
Options exercisable at $0.25 expiring various dates
Options exercisable at $0.25 expiring on various dates
Options exercisable at $0.40 expiring 30.4.2024
Options exercisable at $0.60 expiring 30.4.2024
Number
of options
4,800,000
2,599,999
2,346,665
2,000,000
2,000,000
Number
of holders
5
2
2
1
1
One option holder holds more than 20% of the unquoted options on issue.
86
87
ATOMO ANNUAL REPORT FY22 ATOMO ANNUAL REPORT FY22
1 4 CORPORATE DIRECTORY
Directors
John Keith (Chair & Non-Executive Director)
John Kelly (Managing Director & CEO)
Curt LaBelle (Non-Executive Director)
Paul Kasian (Non-Executive Director)
Deborah Neff (Non-Executive Director)
Company Secretary
Tharun Kuppanda
Registered office
Principal place of business
Share registry
Auditor
Solicitors
Level 1
3 - 5 George Street
Leichhardt NSW 2040
Tel: +61 2 9099 4750
Level 1
3 - 5 George Street
Leichhardt NSW 2040
Tel: +61 2 9099 4750
Link Market Services Limited
Level 12
680 George Street
Sydney NSW 2000
Tel: 1300 554 474
BDO Audit Pty Ltd
Level 11, 1 Margaret Street
Sydney NSW 2000
HWL Ebsworth Lawyers
Level 14, Australia Square
264 - 278 George Street
Sydney NSW 2000
Stock exchange listing
Atomo Diagnostics Limited shares are listed on
the Australian Securities Exchange (ASX code: AT1)
Website
www.atomodiagnostics.com
Corporate Governance Statement
www.atomodiagnostics.com/governance
88
89
ATOMO DIAGNOSTICS LIMITED
ACN 142 925 684