Aurora Labs Limited
ABN 44 601 164 505
Annual Financial Report
30 June 2018
CONTENTS
Corporate Directory
Chairman’s Review
Directors’ Report
Auditor’s Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Additional ASX Information
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Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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CORPORATE DIRECTORY
ABN 44 601 164 505
Directors
David Budge
Nathan Henry
Paul Kristensen
Mel Ashton
Mathew Whyte
Company secretary
Mathew Whyte
Registered Address and Principal
Place of business
Unit 2, 79 Bushland Ridge
Bibra Lake WA 6163
Telephone: +61 (08) 9434 1934
Email:
enquiries@auroralabs3d.com
Solicitors
Jackson McDonald
Level 17, 225 St Georges Terrace
Perth WA 6000
Bankers
ANZ Bank
Riseley Centre
1/35 Riseley Street
Booragoon WA 6154
Auditors
HLB Mann Judd (WA Partnership)
Level 4, 130 Stirling Street
Perth WA 6000
Share Registry
Security Transfer Australia
770 Canning Highway,
Applecross WA 6153
Stock Exchange
Listed on Australian Securities Exchange
The home exchange is Perth, Western Australia
ASX Code
A3D
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CHAIRMANS REVIEW
Dear Shareholder,
As Chairman of the Board of Aurora Labs, newly appointed in January of this year, I take great pleasure in presenting the Company’s 2018
Annual Financial Report.
The Company has made substantial progress on several fronts during the reporting year. I am confident that the intrinsic value of this
progress greatly overshadows the simple bottom line result that may disappoint some of you.
The separate ‘Review of Operations’ in the Directors Report provides you with details of the Company’s activities and ongoing initiatives.
Working with the Aurora team, I have been impressed by the quality of the Company’s directors, executives and staff as well as by its
advanced technology. Aurora Labs is built on very strong foundations and the company shows tremendous commercial potential. Every
effort is being made to turn this potential into hard earnings as soon as possible.
All successful companies need capital to grow, and in April 2018 the company successfully closed an equity raising of $5 million (before
costs), subsequently ratified at a general meeting of shareholders. Pleasingly, this meeting gave me the first opportunity to meet some of
the Company’s valued shareholders.
During the year, with my full support, the Company’s powder production innovation (patent pending) has become the subject of intensified
development and testing. When fully developed, it promises a relatively short path towards securing a substantial, reliable and rapidly
increasing cash-flow, in addition to the more fluctuating revenues from the sale of 3D printers. The new process has already generated
considerable interest from potential business partners as well as the investment community.
This letter to shareholders cannot adequately detail the inventiveness, initiative and hard work that has been demonstrated by the entire
team of Aurora Labs. On behalf of the Board, I offer them and my fellow directors my sincere thanks. A special thanks goes to you, our
shareholders, for your continuing support for which I am confident you will be well rewarded in due course.
Paul Kristensen
Chairman
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DIRECTORS’ REPORT
The Board of Directors of Aurora Labs Limited (“Aurora “or “the Company”) present their report together with the financial report on the
Company for the financial year ended 30 June 2018 (FY 2018) and the independent auditor’s report thereon.
PRINCIPAL ACTIVITIES
The principal activities of the Company during the year included the design and development of 3D metal printers, metal powder
manufacturing plant, digital parts and their associated intellectual property.
OPERATING RESULTS AND REVIEW OF OPERATIONS FOR THE YEAR
Operating Results and Financial Position
Aurora reported a statutory after- tax loss for the year ended 30 June 2018 of $ 5,531,257 (2017: $3,398,989). At the end of the financial
year the Company had net assets of $6,446,642 (2017: $6,775,662) and $3,790,081 in cash and cash equivalents (2017: $5,249,614).
Review of Operations
Aurora is an Australian-based industrial technology and innovation company based in Perth that specialises in the development of 3D
metal printers, metal powder manufacturing plant, digital parts and their associated intellectual property. During the year the Company
made significant progress on the development of its proprietary 3D printer and powder technologies in pursuit of Aurora’s aim to
transform how metal parts and products are manufactured.
Highlights during the year in review were as follows:
•
•
Progress made with Aurora’s Large Format Technology with the prototype being able to print simple parts at market speed.
The signing of a binding term sheet with WorleyParsons in November 2017 to establish a 50/50 joint venture AdditiveNow to service
the mining, oil and gas and major infrastructure industries around the world.
Completion of a capital raising of $5,000,000 (before costs) by way of a placement to institutional and sophisticated investors in
February 2018.
Enhancement of the Board with the appointment of new Board members Mr Paul Kristensen as non-executive Chairman and Mr
Mel Ashton as non-executive director.
Roll out of the Company’s Industry Partner Program including signing of non-binding term sheets with:
•
• VEEM Ltd.
Aurora’s prototype Powder Production Unit successfully producing laboratory scale powder in June 2018.
Expansion of Small Format Printer distribution network into South Korea, Russia and Africa.
DNV GL; and
•
•
•
•
•
Large Format Technology (LFT)
The Company reached a critical milestone during the year announcing the ability
for its prototype to print simple parts at market speed. Market speed is at a rate
comparable to existing technology in the market, but at a fraction of the ultimate
speed of the Large Format Technology, approximately 100 times faster than
existing 3D-printers. This achievement signifies that the key components of the
Large Format Technology have been proven at a fundamental level and will lead
the way for the development of the Medium and Large Format Printer (MFP / LFP).
The Company continues to deliver on the key milestones outlined in the timeline
below. These milestones will demonstrate the progress in the development and
ultimate commercialisation of the Medium and Large Format Printers.
Ti6Al4V DMLM Print - Turbine stator
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Estimated Large Format Technology Development Timeline
Powder production prototype (PPU)
Aurora’s prototype Powder Production Unit (PPU) successfully produced laboratory test scale powder in June, which was a significant
achievement in the process to commercial powder production. The development of the PPU has potential to open considerable new
markets for Aurora and be a source of ongoing revenue for the Company.
The powder from the test samples has demonstrated a very tight size distribution, and this is a positive indication of the very high yields
that Aurora is targeting. The primary advantage the Company is aiming to achieve is to produce a higher quality product at a lower cost
of production.
It is intended that the powders will support part of the projected high utilisation of consumables from the Company’s Large Format
Printer which is currently under development. Currently, the international powdered metals market, e.g. Metal Injection Moulding
(MIM) powders, is valued in the billions of dollars. Advancing Aurora’s PPU technology is intended to develop significant synergies
between metal powder production and the anticipated demand created by additive manufacturing.
Aurora will also be exploring business models and commercial opportunities internationally where there is a large demand for metal
powders in markets not related to 3D printing. The Company continues to deliver on the key milestones outlined in the timeline below.
Estimated Powder Production Unit Development Timeline
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Expansion of distribution network for S Titanum Pro (STP)
During the year, Aurora signed several distribution agreements to advance the marketing and commercialisation of the STP:
• with Partner Labs Co Ltd for exclusive distribution rights in South Korea;
• with Nissa Digispace for exclusive distribution rights in Russia and certain other CIS regions; and
• with Weartech Pty Ltd for exclusive distribution rights in South Africa and non-exclusive distribution license in the 14-member
countries of the Southern African Development Community.
Aurora continues to work with a view to developing its overseas distributor network in order to generate indirect sales of its STP. Sales
will assist with funding the development of the Large Format Technology.
Aurora Labs’ latest distrubtor network
Expansion of the Company’s Industry Partner Program
During the year the Company made significant breakthroughs with the rollout of its Industry Partner Program by the signing of:
•
•
•
a binding term sheet with WorleyParsons to establish a 50/50 incorporated joint venture to be called AdditiveNow Pty Ltd.
AdditiveNow will provide a 3D printing solutions centre to major infrastructure, mining and other resource companies globally
to provide those companies with a competitive advantage over the general market through expert use of key 3D printing
technologies;
of a non-binding term sheet with DNV GL, which allows for the independent certification of Aurora’s 3D-printed parts as fit for
their intended purpose and meeting global certification requirements. DNV GL is a leading global quality assurance and risk
management company, providing classification, technical assurance, software and independent expert advisory services to the
maritime, oil & gas, power and renewables industries.
a non-binding term sheet signed with VEEM Ltd which outlines the opportunity for Aurora to work directly with VEEM for
early access to the Company’s technology, the potential for the purchase of the Company’s 3D-printing machines and the
ability to do R&D on areas that are appropriate for VEEM’s business. VEEM is an ASX-listed company (ASX:VEE) that specialises
in high-technology propellers and gyrostabilisers.
Aurora will continue to grow the Industry Partner Program, and the agreements achieved to date are a validation of Aurora’s business
and acknowledge the potential that 3D printing has in how parts are created and optimised.
FUTURE DEVELOPMENTS AND EXPECTED RESULTS
The objective of the Company is to create long-term shareholder value through the design and development of metal 3D printers and
associated products and services.
The activities outlined in the Review of Operations are inherently risky and the Board is unable to provide certainty of the expected timing
and financial results of these activities, or that any or all of these likely developments will be achieved. All future activities are subject to
various risks and there are no assurances that these targeted milestones will be reached or that the stated timeframes will be met.
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SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Other than reported above in the Review of Results and Operations, there were no significant changes in the state of affairs of the Company
during the reporting period.
LOSS PER SHARE
Basic loss per share
DIVIDENDS OR DISTRIBUTIONS
2018
$
0.091
2017
$
0.063
No dividends were paid during the financial year and the Directors do not recommend the payment of a dividend.
EMPLOYEES
The Company had 36 employees as at the 30 June 2018 (2017: 40).
SUBSEQUENT EVENTS AFTER THE REPORTING DATE
On 12 July 2018, 7,087,500 Class B Performance Shares were automatically redeemed and cancelled as the relevant milestone for their
conversion was not satisfied by 30 June 2018. Refer Aurora’s announcement to ASX dated 12 July 2018 ‘Changes to Company Securities’.
On 16 August 2018 32,260,696 Shares and 9,092,500 Unquoted options (exercisable at $0.20 and expiring 31 December 2018) were
released from escrow.
Other than the above there have been no other matters or circumstances which have arisen since 30 June 2018 that have significantly
affected or may significantly affect:
a) Aurora Labs operations in future financial years; or
b) The results of those operations in future financial years; or
c) Aurora Labs state of affairs in future financial years.
ENVIRONMENTAL LAWS AND REGULATIONS
Aurora Labs operations are subject to various environmental laws and regulations under the relevant government's legislation. The
Company adheres to these laws and regulations. There have been no known breaches of environmental laws and regulations by the
Company during the financial year.
INFORMATION ON THE DIRECTORS
The Directors of the Company at any time during or since the end of the financial year are as follows.
David Budge
Managing Director
Director since incorporation
Nathan Henry
Executive Director
Appointed 23 November 2015
Mathew Whyte
Non-Executive Director and
Company Secretary
Appointed 26 July 2017
Appointed 13 October 2016
Paul Kristensen
Non-Executive Chairman
Appointed 22 January 2018
Mel Ashton
Non-Executive Director
Appointed 22 January 2018
Samantha Tough
Non-Executive Chairman
Appointed 12 June 2017, resigned 25 July 2017
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
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CURRENT DIRECTORS AND OFFICERS
David Budge
Managing Director
Qualifications: Bachelor of Science (Chemistry) from University of Western Australia
Term of office: Since incorporation.
Mr Budge has extensive industry experience in robotics, robotic welding, surfacing engineering, product development and manufacturing
processes. He has become recognised for his experience in solving difficult fabrication and surface engineering problems for clients. He
is the primary inventor of the large majority of Aurora’s inventions that are the subject of its patent applications.
Mr Budge has experience developing and manufacturing a range of products for Australian and international markets. He has previously
worked for a number of engineering companies overseeing several departments, product development and R&D. More recently Mr Budge
established and ran Advanced Industrial Manufacturing Pty Ltd, a company that specialised in providing robotic welding and specialised
technology solutions to the mining and oil and gas sectors.
Mr Budge is a founding director and significant shareholder in Aurora.
During the three- year period to the end of the financial year, Mr Budge has not been a director of any other listed company.
John (Nathan) Henry
Executive Director (Business Development)
Term of office: Since 23 November 2015.
Mr Henry has held senior management roles over the last 25 years. He has been involved in every level of strategic planning, divisional
financial reporting and senior corporate accountability up to Board level. His roles have covered the full spectrum of responsibility
including process and business model development, new business development, technology implementation and roll out through
distributed networks, market research and writing of business plans. He has experience with ISO certification, equipment purchases
recommendations, workflow planning, skilled employee hires, securing AVL status and marketing plans. He has previously developed and
led sales teams for market leading companies both in Australia and in the USA.
Mr Henry is responsible for developing the strategy and processes required for branding and marketing the Company’s products and
services. These include, but are not limited to, 3D printers, consumables, services and licensing. He is responsible for developing advertising
materials, overseeing web design and social media campaigns as well as monitoring metrics for these modes of communication and
marketing.
During the three- year period to the end of the financial year, Mr Henry has not been a director of any other listed company.
Paul Kristensen
Non-Executive Chairman
Qualifications: Bachelor of Science (Mech.Eng.(Hons.)) from the Technical University of Denmark and Member of the Institution of
Engineers Australia (Engineers Australia)
Term of office: Since 22 January 2018
Mr Kristensen is a veteran angel investor and serial entrepreneur with a passion for turning exceptional technology into great business.
Based on initial expertise gained during a career in nuclear science R&D, he combines vision and enthusiasm with innovative strategy
development and in-depth corporate and commercial knowledge, acquired over subsequent decades of activity as a technology investor
and serial entrepreneur. Paul is a highly experienced company chair and director who has taken IP-based companies to IPOs both in
Australia and on overseas stock exchanges. He has previously served as a Chairman of a London AIM -listed Group for 11 years.
During the three-year period to the end of the financial year, Mr Kristensen has not been a director of any other listed company.
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Mel Ashton
Non-Executive Director
Qualifications: Bachelor of Commerce from the University of Western Australia, Fellow of Chartered Accountants Australia and New
Zealand.
Term of office: Since 22 January 2018
Mr Ashton has over 35 years' experience as a Chartered Accountant and leverages his strategic approach and business network in his role
as a specialist in Corporate Restructuring and Finance and as a Professional Company Director. Mel is the independent Chair of the Finance
and Risk Committee at the Hawaiian Group, the Western Australian based property group.
During the three- year period to the end of the financial year Mr Ashton served as Chairman of the Board of Venture Minerals Ltd (May
2006 to Current), Credit Intelligence Ltd (May 2018 to current), Gryphon Minerals Ltd (May 2004 until October 2016) and Empired Ltd
(December 2005 to November 2016).
Mathew Whyte
Non-Executive Director and Company Secretary
Qualifications: Bachelor of Business (Accounting) from Curtin University, CPA and a Fellow of Institute of Chartered Secretaries and
Administrators (Governance Institute of Australia).
Term of office: Company Secretary since 13 October 2016. Non -Executive Director since 26 July 2017.
Mr Whyte is a professional executive with over 25 years’ experience in corporate administration and financial management of small to
medium ASX listed entities. He has specific and hands on Board, Company Secretarial and CFO experience for WA based ASX Listed
Mining, Mining Services, Biotech, Oleochemical and Renewable fuel generation industries with overseas operations experience in USA,
South East Asia, Africa, Eurozone and the UK.
During the three- year period to the end of the financial year, Mr Whyte has served as a Company Secretary for Novo Litio Ltd
(November 2011 – Current), Galileo Mining Ltd (October 2017 – Current) and Tiger Resources Ltd (July 2018 – Current).
Samantha Tough
Non-Executive Chairman
Qualifications: Fellow of the AICD and completed a Bachelor of Laws and Bachelor of Jurisprudence at University of WA.
Term of office: 12 June 2017 to 25 July 2017
DIRECTORS’ INTERESTS
As at the date of this report the relevant interests of each of the Directors, held either directly or indirectly through their associates, in the
securities of Aurora are as follows:
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kristensen
Mel Ashton
Number of fully paid
ordinary shares
Number of unquoted
options over ordinary
shares
Number of performance
shares (Class C)
23,946,785
982,151
-
-
-
1,020,0001
1,973,3342
165,0003
100,0004
100,0004
3,358,334
5,341,975
185,624
-
-
-
5,527,599
Total
28,928,936
1 Unquoted options: 725,000 Ex $0.20/ Exp 31 December 2018; 115,000 Ex $2.23/Exp 30 November 2019;
165,000 Ex $3.00/Exp 31 March 2020; & 15,000 Ex $0.79/Exp 31 August 2020
2 Unquoted options: 1,693,334 Ex $0.20/ Exp 31 December 2018; 140,000 Ex $2.23/Exp 30 November 2019;
125,000 Ex $3.00/Exp 31 March 2020; & 15,000 Ex $0.79/Exp 31 August 2020
3 Unquoted options: 50,000 Ex $3.00/Exp 31 March 2020; 15,000 Ex $0.79/Exp 31 August 2020
& 100,000 EX $0.92/ Exp 31 July 2020
4 Unquoted options 100,000 Ex $1.08/Exp 31 January 2021
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MEETINGS OF DIRECTORS
The following table sets out the number of meetings of Directors held during the year ended 30 June 2018 and the number of meetings
attended by each Director. There was a total of nine (9) Directors’ meetings for the financial year.
2018
David Budge
Nathan Henry
Mathew Whyte
Paul Kristensen
Mel Ashton
Directors’ meetings
Audit Committee meetings
Directors’ meetings
held while a
director
9
9
9
6
6
Number
attended
Audit meetings
held
Audit meetings
attended
9
9
9
6
6
1
1
1
1
1
-
-
1
1
1
In addition, throughout the course of the year there were 12 resolutions of directors which were made by unanimous written resolution.
The Audit Committee was re-established on 17 May 2018 and one (1) Audit Committee meetings was held during the year.
REMUNERATION REPORT (AUDITED)
This remuneration report, which forms part of the Directors’ report, outlines the remuneration arrangements in place for the key
management personnel (“KMP”) of Aurora for the financial year ended 30 June 2018. The information provided in this remuneration report
has been audited as required by Section 308(3C) of the Corporations Act 2001.
Key Management Personnel
(a)
The remuneration report details the remuneration arrangements for key management personnel (“KMP”) of the Company who are
defined as those persons having authority and responsibility for planning, directing and controlling the major activities of the Company,
directly or indirectly, including any Director (whether executive or otherwise) of the Company.
The KMP of the Company during or since the end of the financial year were as follows:
KMP
David Budge
Nathan Henry
Position
Managing Director
Executive Director
Mathew Whyte
Company Secretary ; and
Paul Kristensen
Mel Ashton
Non-Executive Director
Non-Executive Chairman
Non-Executive Director
Samantha Tough
Non-Executive Chairman
(b)
Remuneration Philosophy and Policy
Period of Employment
1 November 2015 to current
23 November 2015 to current
13 October 2016 to current
26 July 2017 to current
22 January 2018 to current
22 January 2018 to current
12 June 2017 to 25 July 2017
The Board has adopted Remuneration and Nomination Policy dated May 2016 (Refer http://auroralabs3d.com/corporate-compliance/ ).
The Company’s remuneration policy for its KMP’s is administered by the Board taking into account the size of the Company, the size of the
management team, the nature and stage of development of the Company’s current operations, and market conditions and comparable
salary levels for companies of a similar size and operating in similar sectors.
Independent external advice is sought from remuneration consultants when required, however no advice has been sought during the
period ended 30 June 2018. The Corporate Governance Statement provides further information on the Company’s remuneration
governance.
Due to the Company’s size and current stage of development, the Board has not established a separate nomination and remuneration
committee at this stage. This function (Remuneration Function) is performed by the Board. Therefore, the Board of Directors of the
Company is responsible for determining and reviewing compensation arrangements for the Managing Director, the Directors and the
executive team.
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In addition, all matters of remuneration will continue to be in accordance with the Corporations Act requirements, especially with regard
to related party transactions. That is, none of the directors participate in any deliberations regarding their own remuneration or related
issues.
In accordance with best practice corporate governance, the structure of Non-Executive Director and Executive remuneration is separate
and distinct.
(c) Non-Executive Director remuneration
On appointment to the Board, all Non-Executive Directors enter into service agreements with the Company in the form of a Non- Executive
deed of Engagement. The Deed of Engagement summarises the Board policies and terms of engagement including remuneration relevant
to the office of director.
The maximum aggregate amount of fees that can be paid to Non-Executive Directors was set by shareholders at General Meeting held on
8 June 2016 at $250,000 per annum. Total Non–Executive remuneration fees paid during the year ended 30 June 2018 were $212,784
(including Superannuation contributions). The Board considers that the aggregate remuneration available for payment will provide the
ability to attract and retain Directors of the highest calibre to meet the Company’s growth in market capitalisation and complexity, at a
cost that is acceptable to shareholders.
Within that maximum aggregate the Board seeks to remunerate Non-Executive Directors at commercial market rates for comparable
companies for their time, commitment and responsibilities. Fees may also be paid to Non-Executive Directors for additional consulting
services provided to the Company.
Fees for Non-Executive Directors are not linked to the performance of the Company. Non-Executive Directors’ remuneration may also
include an incentive portion consisting of options, subject to shareholder approval. Non-Executive Directors are considered Eligible
Employees for the purposes of participation in the Company’s Employee Incentive Plan.
Executive Director Remuneration
(d)
In determining Executive Director remuneration, the Board aims to ensure that remuneration practices are:
• Competitive and reasonable, enabling the Company to attract and retain key talent;
• Aligned to the Company’s strategic and business objectives and the creation of shareholder value;
• Transparent and easily understood; and
• Acceptable to shareholders.
The Company’s remuneration policy is to provide a fixed remuneration component and a short and long-term performance-based
component. The Board believes that this remuneration policy is appropriate given the considerations discussed in the section above and
is appropriate in aligning executives’ objectives with shareholder and business objectives.
Fixed Remuneration
Fixed remuneration consists of base salaries, statutory superannuation contributions and other non-cash benefits. Fixed remuneration is
reviewed annually by the Board in accordance with the Remuneration and Nomination Policy.
Performance Based Remuneration – Short Term Incentive
No Short-Term Incentives were paid or are payable in relation to FY 2018 or FY 2017.
The Board intends to implement a system where Executives may be entitled to an annual cash bonus upon achieving various key
performance indicators (“KPI’s”), as set by the Board. Having regard to the operations of the Company, the Board may determine these
KPI’s, including measures such as successful commercialisation of the Company’s products and services, production and sales levels,
operational cash flows, corporate activities and business development activities.
Performance Based Remuneration – Long Term Incentive
The Board seeks to align the interests of its Directors and Employees with those of its shareholders and accordingly has adopted an
Employee Incentive Share Plan (“Plan”) which provides for the issue of Options or Performance Rights (Awards) as a key component of the
Long-Term Incentive portion of remuneration. Awards under the Plan are based on the following three categories:
1. Package Awards – As part of their employment package with Aurora Labs to attract and retain quality Executives and Employees.
2. Performance Awards – As a reward for Executives and Employees exceeding Company deliverables.
3. Innovation Awards – As a reward for Executives and Employees who have come up with innovative ideas that are deemed to be
beneficial to Aurora and its business operations, usually by reference to whether the idea is likely to be patented or otherwise, form
the basis for potentially valuable proprietary technology of Aurora.
Since the balance date, on 26 July 2018, the Company amended its Plan to provide that any Performance Rights issued under the Plan in
the future will be exercisable Awards and will therefore only be converted into fully paid ordinary shares in the Company (Shares) upon
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receipt by the Company of a notice of exercise from the holder of the Performance Rights. Prior to these amendments, any Performance
Rights issued under the Plan were required to be immediately converted into Shares by the Company upon vesting. The purpose of these
amendments is to allow participants in the Plan to defer the taxing point applicable to the issue of Shares upon the conversion of
performance rights, and therefore make the issue of Performance Rights to participants under the Plan more efficient.
A copy of the Plan is available on the Company’s Website.
During the financial year ended 30 June 2018 the Company granted a total of 867,000 Unquoted Options pursuant to the Plan (2017:
1,411,000). Of these, 345,000 Unquoted Options were granted to Directors with the approval of shareholders at General Meeting. The
remaining 522,000 Unquoted Options were granted to Eligible Employees under the Plan.
Relationship between Remuneration of KMP and the Company’s Performance
(e)
Director’s remuneration is set by reference to payments made by other companies of similar size and industry, and by reference to the
skills and experience of Directors. Fees paid to Directors are not currently linked to the performance of the Company. This policy may
change once the Company’s design, development and commercialisation phases of its business is complete and the Company is generating
revenue and profits. The Board anticipates that the Company will retain earnings (if any) and other cash resources for the development of
its metal 3D printing and associated products and services activities. During the current and previous financial period the Company’s
remuneration policy is not impacted by the Company’s performance including earnings and changes in shareholder wealth (dividends,
changes in share price or returns of capital to shareholders), however this will be reviewed on an annual basis.
Voting and comments made at the Company’s 2017 Annual General Meeting
(f)
Aurora received 92.6% of “Yes“ votes on its remuneration report for the 2017 financial year. The Company did not receive any specific
feedback at the AGM or throughout the year on its remuneration practices.
Executive Director Engagement Deeds
(g)
Remuneration and other terms of employment for KMP are formalised in Engagement Deeds which specify the components of
remuneration, benefits and notice period.
David Budge
Mr Budge is remunerated pursuant to the terms and conditions of his Engagement Deed dated 3 May 2016, as varied on 10 January 2017
following a review of his employment conditions conducted by the Board.
Mr Budge was paid an annual salary of $250,000 plus superannuation. Mr Budge is also paid (by way of reimbursement) a vehicle allowance
comprising business fuel costs, reasonable servicing costs, comprehensive insurance premiums, registration and third-party insurance
costs, and finance payments of between $350 and $400 per month.
Nathan Henry
Mr Henry is remunerated pursuant to the terms and conditions of his Engagement Deed dated 4 May 2016, as varied on 15 March 2017
following a review of his employment conditions conducted by the Board.
Mr Henry was paid an annual salary of $230,000 plus superannuation.
The material terms of both the Deeds for the Executive Directors are as follows:
(i) The employment of each Director may be terminated without cause by the Director or Aurora giving 6 months’ notice. Aurora may
otherwise terminate a Director’s employment immediately for cause (e.g. serious misconduct).
(ii) Each Director is subject to a post-employment restraint on engaging in a business of the same or substantially similar nature to Aurora
or soliciting Aurora’s employees, suppliers or clients within the Asia Pacific region for up to 6 months.
The Deeds otherwise contain terms and conditions considered standard for deeds of this nature.
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Remuneration of KMP
Details of the nature and amount of each element of the emoluments of each of the KMP of Aurora during the financial year were as
follows:
Short-term benefits
Post-
employment
benefits
Share-based
payments
Salary &
fees
$
Motor vehicle
payments
$
Superannuation
$
Options
$
Total
$
Percentage
performance
related
%
250,000
230,000
147,508
33,794
24,029
5,385
690,716
4,795
-
-
-
-
-
4,795
23,750
21,850
1,171
-
-
512
47,283
7,169
7,169
52,369
23,810
23,810
-
114,327
285,714
259,019
201,048
57,604
47,839
5,897
857,121
-
-
-
-
-
-
-
FY 2018
Directors
David Budge1
Nathan Henry2
Mathew Whyte3
Paul Kristensen4
Mel Ashton4
Samantha Tough
Total
1 David Budge was granted 15,000 Unquoted Options, as approved by shareholders at General Meeting held on 29 November 2017,
exercisable at $0.79 and expiring on 31 August 2020 pursuant to Aurora Employee Incentive Plan which were valued using Black-Scholes
pricing model at $0.4779 each:
2 Nathan Henry was granted 15,000 Unquoted Options, as approved by shareholders at General Meeting held on 29 November 2017,
exercisable at $0.79 and expiring on 31 August 2020 pursuant to Aurora Employee Incentive Plan which were valued using Black-Scholes
pricing model at $0.4779 each:
3 Mathew Whyte provided company secretarial services through his controlled entity WhyPro Corporate Services ABN 53 844 654 790.
Payments for company secretarial services during FY 2018 totalled: $115,200 (excluding superannuation). Mr Whyte also received a non-
executive fee of $32,508 (plus superannuation of $1,117). Mr Whyte was granted 115,000 Unquoted Options, as approved by shareholders
at General Meeting held on 29 November 2017, pursuant to Aurora Employee Incentive Plan of which:
• 15,000 Options Exercisable at $0.79 and Expiring 31 August 2020 were valued using Black-Scholes pricing model at $0.4779 each;
and
• 100,000 Options Exercisable at $0.95 and Expiring 31 July 2020 were valued using Black-Scholes pricing model at $0.4520 each.
4 Paul Kristensen and Mel Ashton were each granted 100,000 Unquoted Options, as approved by shareholders at General Meeting held
on 17 April 2018, pursuant to Aurora’s Employee Incentive Plan, Exercisable at $1.08 and Expiring 31 January 2021 which were valued
using Black-Scholes pricing model at $0.2381 each.
Short-term benefits
FY 2017
Directors
David Budge1
Nathan Henry2
Mathew Whyte3
Paul Kehoe
David Parker4
Hendrikus Herman
Samantha Tough
Total
Salary &
fees
$
201,538
172,462
70,400
43,654
29,365
26,250
3,231
546,900
Share-
based
payments
Post- employment
benefits
Superannuation
Options
$
$
Percentage
performance
related
Total
$
%
6,550
-
-
-
-
-
-
6,550
19,146
16,384
-
4,147
985
2,494
307
43,463
79,302
75,544
58,380
-
-
-
-
213,226
306,536
264,390
128,780
47,801
30,350
28,744
3,538
810,139
-
-
-
-
-
-
-
-
1 David Budge was granted 280,000 Unquoted Options pursuant to Aurora Employee Incentive Plan as approved by shareholders at General
Meeting held on 12 Jun 2017 of which:
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 14
• 115,000 Options Exercisable at $2.23 and Expiring 30 November 2019 were valued using Black-Scholes pricing model at $0.2925
each; and
• 165,000 Options Exercisable at $3.00 and Expiring 31 March 2020 were valued using Black-Scholes pricing model at $0.2768 each.
2 Nathan Henry was granted 265,000 Unquoted Options pursuant to Aurora Employee Incentive Plan as approved by shareholders at
General Meeting held on 12 June 2017 of which:
• 140,000 Options Exercisable at $2.23 and Expiring 30 November 2019 were valued using Black-Scholes pricing model at $0.2925
each; and
• 125,000 Options Exercisable at $3.00 and Expiring 31 March 2020 were valued using Black-Scholes pricing model at $0.2768 each.
3 Mathew Whyte provided company secretarial services commencing on 13 Oct 2016 through his controlled entity WhyPro Corporate
Services ABN 53 844 654 790. Payments for company secretarial services during FY 2017 totalled: $70,400. Mr Whyte was also granted
50,000 Unquoted Options on 14 Mar 2017, pursuant to Aurora’s Employee Incentive Plan, Exercisable at $3.00 and Expiring 31 Mar 2020
which were valued using Black-Scholes pricing model at $1.1676 each.
4 David Parker provided company secretarial services through a controlled entity Cobblestones Corporate Pty Ltd. Payments for company
secretarial services during FY 2017 year totalled: $19,000. David Parker is also an employee of Alto Capital who provided Lead Manager
and capital raising services to the Company. Alto Capital was paid $222,452 for services during FY 2017. David Parker was also issued
363,333 ordinary shares as consideration for services from Alto Capital through the Lead Manager mandate agreement during FY 2017.
Cash bonuses granted as compensation for the current financial year.
No cash bonuses were granted during the year ended 2018 (2017: nil)
Options
Details of Options granted as compensation pursuant to the Aurora Employee Incentive Plan for the current financial year
For details on the valuation of the options, including models and assumptions used, please refer to Note 20. There were no material
alterations to the terms and conditions of options granted as remuneration since their grant date.
During FY 2018 KMP were issued Company Options, pursuant to the Employee Share Plan, and with shareholder approval where required.
The table below details all options issued during FY 2018, noting some options have been issued to employees or consultants that are not
KMPs.
FY 2018
Date options granted
Number of
Options
Exercise price of
option
$
Expiry date of
option
1.17
0.79
0.95
0.72
1.08
30 June 20
31 Aug 20
31 Jul 20
30 Sept 20
31 Jan 21
Value of
Options at
grant date
$
0.26
0.30
0.48
0.23
0.24
12 July 17
29 Nov 17
29 Nov 17
3 Oct 2017
17 Apr 18
Total
FY 2017
Date options granted
22 Nov 16
14 Mar 17
10 May 17
12 Jun 17
Total
40,000
477,000
100,000
50,000
200,000
867,000
Number of
Options
225,000
641,000
290,000
255,000
1,411,000
Exercise price of
option
$
Expiry date of
option
2.23
3.00
3.00
2.23
30 Nov 19
31 Mar 20
31 Mar 20
30 Nov 19
Value of Options at
grant date
$
0.29
1.17
0.28
0.29
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 15
Company Options granted to KMP
During the financial year, Unquoted Options were granted to the following KMP, or the entities they controlled, pursuant to the Employee
Incentive Plan as part of their remuneration.
Exercise price
Expiry date
Number of options
granted
Total number of shares
under option at the end of
the year
FY 2018
Directors
David Budge
Nathan Henry
Mathew Whyte
Mathew Whyte
Paul Kristensen
Mel Ashton
Total
FY 2017
Directors
David Budge
David Budge
Nathan Henry
Nathan Henry
Mathew Whyte
Paul Kehoe
Samantha Tough
Hendrikus Herman
David Parker
Total
$
0.79
0.79
0.79
0.95
1.08
1.08
$
2.23
3.00
2.23
3.00
3.00
-
-
-
-
Exercise price
Expiry date
Number of options
granted
Total number of shares
under option at the end of
the year
31 Aug 20
31 Aug 20
31 Aug 20
31 Jul 20
31 Jan 21
31 Jan 21
15,000
15,000
15,000
100,000
100,000
100,000
345,000
15,000
15,000
15,000
100,000
100,000
100,000
345,000
30 Nov 19
31 Mar 20
30 Nov 19
31 Mar 20
31 Mar 20
-
-
-
-
115,000
165,000
140,000
125,000
50,000
-
-
-
-
115,000
165,000
140,000
125,000
50,000
-
-
-
-
595,000
595,000
There were no alterations to the terms and conditions of Options granted as remuneration since their grant date, other than minor
amendments to the term relating to transferability of the Options which was approved by shareholders at a general meeting on 13 June
2016.
There were no shares issued during FY 2018 or FY 2017 as a result of the exercise of an Option by KMP. No Options lapsed during FY 2018
or FY 2017.
Shares and performance shares issued to KMP
During FY 2018 no shares or performance shares were issued to KMP as part of their remuneration.
During FY 2017 no shares or performance shares were issued to KMP as part of their remuneration.
Loans to and from KMP
There were no loans made to or from KMP during FY 2018 and there are no loans outstanding from KMP at the date of this report.
There were no loans made to or from KMP during FY 2017 and there are no loans outstanding from KMP at the date of this report.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 16
KMP equity holdings
Fully paid ordinary shares
Balance at
beginning of
year
Number
Granted as
compensation
Number3
Received
on exercise
of options
Number
Net change
other
Number2
Balance at end
of year
Number
Balance held
nominally
Number
23,946,785
982,151
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
23,946,785
982,151
-
-
-
-
-
150,000
-
-
-
-
Balance at
beginning
of period
Number
Granted as
compensation
Number3
Received
on exercise
of options
Number
Net change
other
Number2
Balance at end
of year
Number
Balance held
nominally
Number
23,946,785
832,151
-
1,093,750
246,667
782,151
-
-
-
-
-
363,333
-
-
-
-
-
-
-
-
-
-
150,000
-
1,000,000
250,000
150,000
-
23,946,785
982,151
-
2,093,750
860,000
932,151
-
-
150,000
-
2,093,750
400,000
932,151
-
FY 2018
Directors
David Budge
Nathan Henry
Paul Kristensen
Mel Ashton
Mathew Whyte
Samantha Tough
FY 2017
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kehoe1
David Parker1
Hendrikus Herman1
Samantha Tough1
1 Held as at date of resignation.
2 Shares acquired by subscription through IPO Prospectus for a consideration paid of $0.20 per share
3 David Parker was also an employee of Alto Capital who provided Lead Manager and capital raising services to the Company. David Parker
was issued 363,333 ordinary shares as consideration for services from Alto Capital through the Lead Manager mandate agreement during
FY 2017.
Company Options
Balance at
beginning of
year
Number
1,005,000
1,958,334
50,000
-
-
Balance at
beginning of
year
Number
725,000
1,693,334
-
500,000
-
1,693,333
-
FY 2018
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kristensen
Mel Ashton
FY 2017
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kehoe1
David Parker1
Hendrikus Herman1
Samantha Tough1
Granted as
compensation
Number
Exercised
Number
Net change
other
Number2
Balance at end of year
Number
15,000
15,000
115,000
100,000
100,000
Granted as
compensation
Number
Exercised
Number
280,000
265,000
50,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,020,000
1,973,334
165,000
100,000
100,000
Net change
other
Number2
Balance at end of year
Number
-
-
-
1,000,000
1,000,000
-
-
1,005,000
1,958,334
50,000
1,500,000
1,000,000
1,693,333
-
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 17
1 Held as at date of resignation.
2 Options acquired by subscription through IPO Prospectus for a consideration paid of $0.01 per share.
All Company Options issued to KMP were made in accordance with the provisions of the Employee Incentive Plan. During the year, no
options were exercised or sold. No amounts remain unpaid on the options during the financial year at year end.
Performance Shares Class A
Balance at
beginning of
year
Number
Granted as
compensation for
services
Number
Issued pursuant
to pro-rata bonus
issue
Number
4,420,945
153,628
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Redeemed and
cancelled
Number
4,420,9451
153,6281
-
-
-
-
Balance
at end of
year
Number
Balance held
nominally
Number
-
-
-
-
-
-
-
-
-
-
-
-
FY 2018
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kristensen
Mel Ashton
Samantha Tough
1 Subsequent to beginning of year on 7 July 2017 all Class A Performance Shares were redeemed and cancelled.
Balance at
beginning of
year
Number
Granted as
compensation for
services
Number
Issued pursuant to
pro-rata bonus
issue
Number
Redeemed
and cancelled
Number
Balance
at end
of year
Number
Balance held
nominally
Number
4,420,945
153,628
-
75,000
80,192
144,397
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,420,945
153,628
-
75,000
80,192
144,397
-
-
-
-
75,000
27,692
46,154
-
FY 2017
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kehoe1
David Parker1
Hendrikus Herman1
Samantha Tough1
1 Held as at date of resignation.
Performance Shares Class B
Balance at
beginning of
year
Number
Granted as
compensation for
services
Number
Issued pursuant to
pro-rata bonus issue
Number
Balance at end
of year
Number
Balance held
nominally
Number
4,973,945
172,832
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,973,945
172,832
-
-
-
-
-
-
-
-
-
-
FY 2018
Directors
David Budge1
Nathan Henry1
Mathew Whyte
Paul Kristensen
Mel Ashton
Samantha Tough
1 Subsequent to balance date all Class B Performance shares were redeemed and cancelled on 12 July 2018
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 18
Balance at
beginning of
year
Number
Granted as
compensation for
services
Number
Issued pursuant to
pro-rata bonus issue
Number
Balance at end
of year
Number
Balance held
nominally
Number
Performance Shares Class B
FY 2017
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kehoe1
David Parker1
Hendrikus Herman1
Samantha Tough
4,973,945
172,832
-
84,375
90,216
162,448
-
1 Held as at date of resignation.
Performance Shares Class C
Balance at
beginning of
year
Number
Granted as
compensation for
services
Number
5,341,975
185,624
-
-
-
-
FY 2018
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kristensen
Mel Ashton
Samantha Tough
Performance Shares Class C
Balance at
beginning of
year
Number
Granted as
compensation for
services
Number
5,341,975
185,624
-
90,625
96,898
174,480
-
FY 2017
Directors
David Budge
Nathan Henry
Mathew Whyte
Paul Kehoe
David Parker
Hendrikus Herman
Samantha Tough
END OF AUDITED REMUNERATION REPORT
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,973,945
172,832
-
84,375
90,216
162,448
-
-
-
-
84,375
31,154
51,924
-
Issued pursuant to
pro-rata bonus issue
Number
Balance at end
of year
Number
Balance held
nominally
Number
-
-
-
-
5,341,975
185,624
-
-
-
-
-
-
Issued pursuant to
pro-rata bonus issue
Number
Balance at end
of year
Number
Balance held
nominally
Number
5,341,975
185,624
-
90,625
96,898
174,480
-
-
-
-
-
-
-
-
-
-
90,625
33,461
55,769
-
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 19
SHARE OPTIONS
At the date of this report the unissued ordinary shares of the Company under option are as follows:
Grant Date
23 Nov 151
10 May 16
3 Aug 162
22 Nov 163
14 Mar 173
12 Jun 174
12 Jun 174
12 Jul 175
29 Aug 175
27 Sep 175
29 Nov 175
29 Nov 175
17 Apr 185
17 Apr 186
17 Apr 186
TOTAL
Date of
Expiry
31 Dec 18
31 Dec 18
31 Dec 18
30 Nov 19
31 Mar 20
30 Nov 19
31 Mar 20
30 Jun 20
31 Aug 20
30 Sep 20
31 Aug 20
31 Jul 20
31 Jan 21
17 Apr 20
17 Apr 20
Exercise Price
$
0.20
0.20
0.20
2.23
3.00
2.23
3.00
1.17
0.79
0.72
0.79
0.95
1.08
1.00
1.00
Outstanding at
1 Jul 17
1,400,000
4,250,000
5,500,000
225,000
641,000
255,000
290,000
-
-
-
-
-
-
-
-
12,561,000
Lapsed/
Cancelled or
Exercised
(1,292,075)7
-
-
-
-
-
-
-
(15,000)
-
-
-
-
(1,307,075)
Outstanding at Date
of this Repot
107,925
4,250,000
5,500,000
225,000
641,000
255,000
290,000
40,000
417,000
50,000
45,000
100,000
200,000
500,000
3,186,000
15,806,925
1 Number of options issued on a post consolidation basis.
2 Options issued pursuant to the Initial Public Offering for $0.01 per option.
3 Options issued to eligible non- related parties pursuant to Aurora Employee Incentive Plan.
4 Options issued to eligible related parties pursuant to Aurora Employee Incentive Plan approved at General Meeting on 12 June 2017.
5 Options issued to eligible related parties pursuant to Aurora Employee Incentive Plan approved at General Meeting on 17 April 2018.
6 Options issued pursuant to the Placement and SPP for $0.01 per option.
71,292,075 fully paid ordinary shares were issued during the year (2017: 100,000) as a result of the exercise of Options.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied for leave of court to bring proceedings on behalf of the Company or intervene in any proceedings to which the
Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company
was not a party to any such proceedings during the year.
INDEMNITIES GIVEN AND INSURANCE PREMIUMS PAID TO OFFICERS AND AUDITORS
The Company has entered into Deeds of Indemnity, Insurance and Access with each Director.
Under these deeds, the Company has undertaken, subject to restrictions in the Corporations Act, to:
Indemnify each Director from certain liabilities incurred from acting in that position under specified circumstances;
a)
b) Maintain directors’ and officers’ insurance cover (if available) in favour of each Director whilst that person maintains such office and
for seven years after the Director has ceased to be a Director;
c) Provide access to any Company records which are relevant to the Director’s holding of office with the Company, for a period of seven
years after the Director has ceased to be a director.
During the year, the Company paid a premium to insure officers of the Company. The officers of the Company covered by the insurance
policy include all directors and the company secretary.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 20
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be bought against the officers
in their capacity as officers of the Company, and any payments arising from liabilities incurred by the officers in connection with such
proceedings, other than where such liabilities arise out of conduct involving a wilful breach of duty by the officers or the improper use by
the officers of their position or of information to gain advantage for themselves or someone else to cause detriment to the Company.
Details of the amount of the premium paid in respect of the insurance policies is not disclosed as such disclosure is prohibited under the
terms of the contract.
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted by law, indemnified or agreed
to indemnify any current or former officer or auditor of the Company against any liability as such by an officer or auditor.
NON-AUDIT SERVICES
There were no non -audit services provided during the financial year by the auditor.
AUDITOR INDEPENDENCE AND NON-AUDIT SERVICES
Section 307C of the Corporations Act 2001 requires our auditors, HLB Mann Judd, to provide the Directors of the Company with an
Independence Declaration in relation to the audit of the annual report. This Independence Declaration is set out on page 21 and forms
part of this Directors’ report for the year ended 30 June 2018.
Signed in accordance with a resolution of the Directors.
Mr David Budge
Managing Director
Dated this 21 August 2018
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 21
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Aurora Labs Limited for the year ended 30
June 2018, I declare that, to the best of my knowledge and belief, there have been no
contraventions of:
(a)
(b)
the auditor independence requirements as set out in the Corporations Act 2001 in relation to
the audit; and
any applicable code of professional conduct in relation to the audit.
Perth, Western Australia
21 August 2018
N G Neill
Partner
HLB Mann Judd (WA Partnership) ABN 22 193 232 714
Level 4 130 Stirling Street Perth WA 6000 | PO Box 8124 Perth BC WA 6849 | Telephone +61 (08) 9227 7500 | Fax +61 (08) 9227 7533
Email: mailbox@hlbwa.com.au | Website: www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation
HLB Mann Judd (WA Partnership) is a member of International, a world-wide organisation of accounting firms and business advisers
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 22
CONDENSED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2018
Notes
30 June 18
30 June 17
$
$
Continuing operations
Revenue
Cost of sales
Other income
Advertising
3(a)
3(b)
329,970
(116,692)
79,647
(213,877)
Research and development expenses
3(c)
(1,321,085)
Rent
Corporate expenses
Depreciation
Employee benefits
Employee share based payments (non-cash)
Other expenses
Loss before income tax benefit
Income tax benefit
Loss for the year
(347,794)
(811,870)
(158,899)
20
3(d)
(3,184,438)
(2,044,314)
(265,722)
(1,084,984)
(1,053,214)
(576,349)
(7,063,974)
(4,802,916)
4
1,532,717
1,403,927
(5,531,257)
(3,398,989)
237,995
(154,062)
52,255
(155,232)
(504,592)
(113,177)
(432,037)
(28,419)
Loss attributable to members of the Company
(5,531,257)
(3,398,989)
Other comprehensive income, net of income tax
-
-
Total comprehensive loss for the year
(5,531,257)
(3,398,989)
Basic loss per share
Diluted loss per share
5(d)
5(d)
cents
9.13
9.13
cents
6.30
6.30
The accompanying notes form part of these financial statements.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 23
CONDENSED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2018
Assets
Current Assets
Cash and cash equivalents
Trade and other receivables
Inventories
Total Current Assets
Non-Current Assets
Property, plant and equipment
Intangible assets
Total Current Assets
Total Assets
Liabilities
Current Liabilities
Trade and other payables
Other liabilities
Accrued annual leave
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Net Equity
Notes
30 June 18
30 June 17
$
$
7
8
9
10
11
12
12
12
5(a)
5(c)
3,790,081
1,807,024
656,437
6,253,542
475,162
510,137
985,299
5,249,614
1,433,179
509,402
7,192,195
357,081
225,545
582,626
7,238,841
7,774,821
555,184
52,534
184,481
792,199
632,908
242,108
124,143
999,159
6,446,642
6,775,662
15,232,021
1,513,206
(10,298,585)
6,446,642
10,345,506
1,197,484
(4,767,328)
6,775,662
The accompanying notes form part of these financial statements.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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CONDENSED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2018
Issued
Capital
$
Option Reserve
$
Accumulated
Losses
$
Total Equity
$
Balance at 1 July 2017
10,345,506
1,197,484
(4,767,328)
6,775,662
Equity issued during the year (net of
share issue costs)
Loss for the year
Other comprehensive income for the
year, net of income tax
Total comprehensive loss for the year
4,886,515
315,722
-
5,202,237
-
-
-
-
-
-
(5,531,257)
(5,531,257)
-
-
(5,531,257)
(5,531,257)
Balance as at 30 June 2018
15,232,021
1,513,206
(10,298,585)
6,446,642
Issued
Capital
Option Reserve
$
$
Accumulated
Losses
$
Total Equity
$
Balance at 1 July 2016
1,365,625
57,500
(1,368,339)
54,786
Equity issued during the year (net of
share issue costs)
Loss for the year
Other comprehensive income for the
year, net of income tax
Total comprehensive loss for the year
8,979,881
1,139,984
-
10,119,865
-
-
-
-
-
-
(3,398,989)
(3,398,989)
-
-
(3,398,989)
(3,398,989)
Balance as at 30 June 2017
10,345,506
1,197,484
(4,767,328)
6,775,662
The accompanying notes form part of these financial statements.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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CONDENSED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2018
Cash flows from operating activities
Payments to suppliers and employees
(6,998,234)
(4,130,484)
30 June 18
30 June 17
Note
$
$
Receipts from customers
Refunds to customers
Interest Received
Income tax benefit
306,050
(149,390)
89,839
1,052,717
112,000
-
41,639
323,927
Net cash (used in) operating activities
7
(5,699,018)
(3,652,918)
Cash flows from investing activities
Property, plant and equipment
Payments for intangible assets
Net cash (used in) investing activities
Cash flows from financing activities
Proceeds from issue of shares (net of capital raising
costs)
Net cash provided by financing activities
(283,629)
(300,357)
(583,986)
(345,619)
(161,775)
(507,394)
4,825,309
4,825,309
7,056,521
7,056,521
Net decrease in cash held
(1,457,695)
(2,896,209)
Cash and cash equivalents at the beginning of the
year
Exchange rate adjustments
5,249,614
2,353,226
(1,838)
179
Cash and cash equivalents at the end of the year
7
3,790,081
5,249,614
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
(a)
These financial statements are general purpose financial statements, which have been prepared in accordance with the requirements of
the Corporations Act 2001, Accounting Standards and Interpretations and comply with other requirements of the law.
The financial statements comprise the financial statements for the Company. For the purposes of preparing the financial statements, the
Company is a for-profit entity.
The accounting policies detailed below have been consistently applied to all of the years presented unless otherwise stated. The financial
statements are for Aurora Labs Limited (“Aurora” or the “Company”) which has no subsidiaries.
The financial statements have been prepared on a historical cost basis. Historical cost is based on the fair values of the consideration
given in exchange for goods and services.
The financial statements are presented in Australian dollars.
The principal activities of the Company during the year included the design and development of 3D metal printers, powders, digital parts
and their associated intellectual property.
(b)
Adoption of new and revised standards
Standards and Interpretations applicable to 30 June 2018
In the year ended 30 June 2018, the Directors have reviewed all of the new and revised Standards and Interpretations issued by the AASB
that are relevant to the Company and effective for the current annual reporting period. As a result of this review, the Directors have
determined that there is no material impact of the new and revised Standards and Interpretations on the Company and, therefore, no
material change is necessary to Group accounting policies.
Standards and Interpretations in issue not yet adopted
The Directors have also reviewed all Standards and Interpretations issued but not yet adopted for the year ended 30 June 2018. As a result
of this review the Directors have determined that the following Standards and Interpretations may have a material effect on Group
accounting policies in future financial periods, namely:
•
•
The Company has elected not to early adopt these Standards and Interpretations.
AASB 15 Revenue from Contracts with Customers
AASB 16 Leases
AASB 15 Revenue from Contracts with Customers
Rendering of services
The Company provides installation services to customers. The Company recognises service revenue by reference to the stage of
completion. Under AASB 15 the revenue allocated to the service will be recognised over time as the customer utilises the service. The
impact to revenue and profit or loss for the current year is not material.
AASB 16 Leases
AASB 16 replaces the AASB 117 Leases, Interpretation 4 Determining whether an Arrangement contains a Lease, Interpretation 115
Operating Leases-Incentives and Interpretation 127 Evaluating the Substance of Transactions Involving the Legal Form of a Lease. AASB
16 removes the classification of leases as either operating leases or finance leases- for the lessee - effectively treating all leases as finance
leases. Most leases will be capitalised on the balance sheet by recognising a lease liability for the present value obligation and a 'right-of-
use' asset. The right of use assets is calculated based on the lease liability plus initial direct costs, prepaid lease payments and estimated
restoration costs less lease incentives received. This will result in an increase in the recognised assets and liabilities in the statement of
financial position as well as a change in expense recognition, with interest and deprecation replacing operating lease expense. There are
exemptions for short-term leases and leases of low-value items.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Lessor accounting remains similar to current practice, i.e. lessors continue to classify leases as finance and operating leases.
This standard will primarily affect the accounting for the Company’s operating leases. As at 30 June 2018, the Company has $267,493 of
non-cancellable operating lease commitments relating to a property lease. The Company is considering the available options to account
for this transition but the Company expects a change in reported earnings before interest, tax, depreciation and amortisation (EBITDA)
and increase in lease assets and liabilities recognition. The lease standard is also expected a considerable impact on deferred tax balances.
This will however be dependent on the lease arrangements in place when the new standard is effective. The Company has commenced
the process of evaluating the impact of the new lease standard.
AASB 16 is effective from annual reporting periods beginning on or after 1 January 2019, with early adoption permitted for entities that
also adopt AASB 15. A lessee can choose to apply the standard using a full retrospective or a modified retrospective approach.
Statement of compliance
(c)
The financial report was authorised for issue in accordance with a resolution of the Directors on 21 August 2018.
The financial report complies with Australian Accounting Standards, which include Australian equivalents to International Financial
Reporting Standards (AIFRS). Compliance with AIFRS ensures that the financial report, comprising the financial statements and notes
thereto, complies with International Financial Reporting Standards (IFRS).
Significant accounting estimates and judgements
(d)
The application of accounting policies requires the use of judgements, estimates and assumptions about carrying values of assets and
liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience
and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions are recognised in the period in which the estimate
is revised if it affects only that period, or in the period of the revision and future periods if the revision affects both current and future
periods.
Impairment of intangibles with indefinite useful lives:
The Company determines whether intangibles with indefinite useful lives are impaired at least on an annual basis. This requires an
estimation of the recoverable amount of the cash generating units to which the intangibles with indefinite useful lives are allocated.
Share-based payment transactions:
The Company 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 is determined using internal valuation models in conjunction with the market price
of the share-based payments.
Segment reporting
(e)
The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating segments,
has been identified as the Board of Directors of Aurora Labs Limited.
The Company operating segment has been determined with reference to the monthly management accounts used by the chief operating
decision maker to make decisions regarding the Company operations and allocation of working capital.
Based on the quantitative thresholds included in AASB 8, there is only one reportable segment, being the design, development and
manufacture of 3D metal printers and associated products and services for the year ended 30 June 2018 and the year ended 30 June
2017.
The revenues and results of this segment are those of the Company as set out in the statement of comprehensive income and the assets
and liabilities of the Company are set out in the statement of financial position.
Foreign currency translation
(f)
Both the functional and presentation currency of Aurora Labs Limited is Australian dollars.
Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates ruling at the date of the
transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the
balance date.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued
All exchange differences in the financial report are taken to profit or loss with the exception of differences on foreign currency borrowings
that provide a hedge against a net investment in a foreign entity. These are taken directly to equity until the disposal of the net
investment, at which time they are recognised in profit or loss.
Tax charges and credits attributable to exchange differences on those borrowings are also recognised in equity.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate as at the
date of the initial transaction.
Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value
was determined. Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss.
Revenue recognition
(g)
Revenue is measured at fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade
allowances, rebates and amounts collected on behalf of third parties.
Sale of goods
Revenue is recognised when all the following conditions are satisfied:
•
•
the Company has transferred to the buyer the significant risks and rewards of ownership of the goods;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective
control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the economic benefits associated with the transaction will flow to the Company; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.
•
•
•
Interest income
Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the
amount of revenue can be reliably measured. Interest income is accrued on a time basis, by reference to the principal outstanding and
at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life
of the financial asset to that assets’ net carrying amount on initial recognition.
Leases
(h)
Operating lease payments are recognised as an expense on a straight line basis over the lease term, except where another systematic
basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. In the event that lease
incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is
recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the
time pattern in which economic benefits from the leased asset are consumed.
Income tax
(i)
The income tax expense or benefit for the period is the tax payable on the current period’s taxable income based on the applicable
income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary difference and
to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting
period. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is
subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to
the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by
the balance date.
Deferred income tax is provided on all temporary differences at the balance date between the tax bases of assets and liabilities and their
carrying amounts for financial reporting purposes.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Deferred income tax liabilities are recognised for all taxable temporary differences except:
•
when the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a
business combination and that, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures,
and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference will
not reverse in the foreseeable future.
•
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and unused tax
losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the
carry-forward of unused tax credits and unused tax losses can be utilised, except:
•
•
when the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset
or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting
profit nor taxable profit or loss; or
when the deductible temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures,
in which case a deferred tax asset is only recognised to the extent that it is probable that the temporary difference will reverse in
the foreseeable future and taxable profit will be available against which the temporary difference can be utilised.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Unrecognised deferred income tax assets are reassessed at each balance date and are recognised to the extent that it has become
probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised
or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in profit or loss.
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against
current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority.
Other taxes
(j)
Revenues, expenses and assets are recognised net of the amount of GST except:
•
•
when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST
is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
receivables and payables, which are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the
statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from investing and
financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows.
Deferred income tax liabilities are recognised for all taxable temporary differences except:
•
•
when the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a
business combination and that, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
when the taxable temporary difference is associated with investments in subsidiaries, associates or interests in joint ventures,
and the timing of the reversal of the temporary difference can be controlled and it is probable that the temporary difference will
not reverse in the foreseeable future.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Impairment of tangible and intangible assets other than goodwill
(k)
The Company assesses at each balance date whether there is an indication that an asset may be impaired. If any such indication exists,
or when annual impairment testing for an asset is required, the Company makes an estimate of the asset’s recoverable amount. An
asset’s recoverable amount is the higher of its fair value less costs to sell and its value in use and is determined for an individual asset,
unless the asset does not generate cash inflows that are largely independent of those from other assets or companies of assets and the
asset's value in use cannot be estimated to be close to its fair value.
In such cases the asset is tested for impairment as part of the cash-generating unit to which it belongs. When the carrying amount of an
asset or cash-generating unit exceeds its recoverable amount, the asset or cash-generating unit is considered impaired and is written
down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset. Impairment losses relating to continuing
operations are recognised in those expense categories consistent with the function of the impaired asset unless the asset is carried at
revalued amount (in which case the impairment loss is treated as a revaluation decrease).
An assessment is also made at each balance date as to whether there is any indication that previously recognised impairment losses may
no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously recognised impairment
loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last
impairment loss was recognised. If that is the case the carrying amount of the asset is increased to its recoverable amount. That increased
amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been
recognised for the asset in prior years. Such reversal is recognised in profit or loss unless the asset is carried at revalued amount, in which
case the reversal is treated as a revaluation increase. After such a reversal the depreciation charge is adjusted in future periods to allocate
the asset’s revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.
Cash and cash equivalents
(l)
Cash comprises cash at bank and in hand. Cash equivalents are short term, highly liquid investments that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in value.
For the purposes of the statement of cash flows, cash and cash equivalents consist of cash and cash equivalents as defined above.
(m) Trade and other receivables
Trade receivables are measured on initial recognition at fair value and are subsequently measured at amortised cost using the effective
interest rate method, less any allowance for impairment. Trade receivables are generally due for settlement within periods ranging from
15 to 30 days.
Impairment of trade receivables is continually reviewed and those that are considered to be uncollectible are written off by reducing the
carrying amount directly. An allowance account is used when there is objective evidence that the Company will not be able to collect all
amounts due according to the original contractual terms. Factors considered by the Company in making this determination include known
significant financial difficulties of the debtor, review of financial information and significant delinquency in making contractual payments
to the Company. The impairment allowance is set equal to the difference between the carrying amount of the receivable and the present
value of estimated future cash flows, discounted at the original effective interest rate. Where receivables are short-term discounting is
not applied in determining the allowance.
The amount of the impairment loss is recognised in the statement of comprehensive income within other expenses. When a trade
receivable for which an impairment allowance had been recognised becomes uncollectible in a subsequent period, it is written off against
the allowance account. Subsequent recoveries of amounts previously written off are credited against other expenses in the statement of
comprehensive income.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Inventories
(n)
Inventories are valued at the lower of cost and net realisable value.
Costs incurred in bringing each product to its present location and condition is accounted for as follows:
•
•
Raw materials – purchase cost on a first-in, first-out basis; and
Finished goods and work-in-progress – cost of direct materials and labour and a proportion of manufacturing overheads based
on normal operating capacity but excluding borrowing costs.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated
costs necessary to make the sale.
Property, plant and equipment
(o)
Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses. Such cost includes the cost
of replacing parts that are eligible for capitalisation when the cost of replacing the parts is incurred. Similarly, when each major inspection
is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement only if it is eligible for
capitalisation.
Depreciation is calculated on diminishing value basis using the following notes:
Plant and equipment 10% to 30%
Leasehold Improvements Over the term of the lease
The assets' residual values, useful lives and amortisation methods are reviewed, and adjusted if appropriate, at each financial year end.
Impairment
The carrying values of plant and equipment are reviewed for impairment at each reporting date, with recoverable amount being
estimated when events or changes in circumstances indicate that the carrying value may be impaired.
The recoverable amount of plant and equipment is the higher of fair value less costs to sell and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments
of the time value of money and the risks specific to the asset.
For an asset that does not generate largely independent cash inflows, recoverable amount is determined for the cash-generating unit to
which the asset belongs, unless the asset's value in use can be estimated to approximate fair value.
An impairment exists when the carrying value of an asset or cash-generating unit exceeds its estimated recoverable amount. The asset
or cash-generating unit is then written down to its recoverable amount.
For plant and equipment, impairment losses are recognised in the statement of comprehensive income in the cost of sales line item.
However, because land and buildings are measured at revalued amounts, impairment losses on land and buildings are treated as a
revaluation decrement.
Derecognition and disposal
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from
its use or disposal.
Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying
amount of the asset) is included in profit or loss in the year the asset is derecognised.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(p)
Intangible assets
Intangible assets acquired separately
Intangible assets acquired separately are recorded at cost less accumulated amortisation and impairment. Amortisation is charged on a
straight-line basis over their estimated useful lives. The estimated useful life and amortisation method is reviewed at the end of each
annual reporting period, with any changes in these accounting estimates being accounted for on a prospective basis.
Internally generated intangible assets – research and development expenditure
Expenditure on research activities is recognised as an expense in the period in which it is incurred. Where no internally-generated
intangible asset can be recognised, development expenditure is recognised as an expense in the period as incurred.
An intangible asset arising from development (or from the development phase of an internal project) is recognised if, and only if, all of
the following have been demonstrated:
•
•
•
•
•
•
The technical feasibility of completing the intangible asset so that it will be available for use or sale;
The intention to complete the intangible asset and use or sell it;
The ability to use or sell the intangible asset;
How the intangible asset will generate probable future economic benefits;
The availability of adequate technical, financial and other resources to complete development and to use or sell the intangible
asset; and
The ability to measure reliably the expenditure attributable to the intangible asset during its development.
The amount initially recognised for internally-generated intangible assets is the sum of the expenditure incurred from the date when the
intangible asset first meets the recognition criteria listed above.
Subsequent to initial recognition, internally-generated intangible assets are reported at cost less accumulated amortisation and
accumulated impairment losses, on the same basis as intangible assets acquired separately.
The following useful lives are used in the calculation of amortisation:
Patents 20 years from application following grant of patent
Trade and other payables
(q)
Trade payables and other payables are carried at amortised cost and represent liabilities for goods and services provided to the Company
prior to the end of the financial year that are unpaid and arise when the Company becomes obliged to make future payments in respect
of the purchase of these goods and services. Trade and other payables are presented as current liabilities unless payment is not due
within 12 months.
Provisions
(r)
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that
an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of
the amount of the obligation. Provisions are not recognised for future operating losses.
When the Company expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is
recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented
in the statement of comprehensive income net of any reimbursement.
Provisions are measured at the present value or management’s best estimate of the expenditure required to settle the present obligation
at the end of the reporting period.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects the risks specific
to the liability.
When discounting is used, the increase in the provision due to the passage of time is recognised as an interest expense.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(s)
Employee leave benefits
Wages, salaries, annual leave and sick leave
Liabilities accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave expected to be settled
within 12 months of the balance date are recognised in other payables in respect of employees’ services up to the balance date. They are
measured at the amounts expected to be paid when the liabilities are settled. Liabilities for non-accumulating sick leave are recognised
when the leave is taken and are measured at the rates paid or payable.
Liabilities accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave not expected to be
settled within 12 months of the balance date are recognised in non-current other payables in respect of employees’ services up to the
balance date. They are measured as the present value of the estimated future outflows to be made by the Company.
Long service leave
The liability for long service leave is recognised in the provision for employee benefits and measured as the present value of expected
future payments to be made in respect of services provided by employees up to the balance date. Consideration is given to expected
future wage and salary levels, experience of employee departures, and period of service. Expected future payments are discounted using
market yields at the balance date on national government bonds with terms to maturity and currencies that match, as closely as possible,
the estimated future cash outflows.
Share-based payment transactions
(t)
Equity settled transactions
The Company provides benefits to employees (including senior executives) of the Company in the form of share-based payments,
whereby employees render services in exchange for shares or rights over shares (equity-settled transactions).
The Company has the following plan in place:
•
the Employee Incentive Plan (EIP), which provides benefits to Directors and senior executives and is governed by the Employee
Incentive Plan Rules.
The cost of these equity-settled transactions with employees is measured by reference to the fair value of the equity instruments at the
date at which they are granted. The fair value is determined by internal valuation using a Black-Scholes model, further details of which
are given in Note 20.
In valuing equity-settled transactions, no account is taken of any performance conditions, other than conditions linked to the price of the
shares of Company (market conditions) if applicable.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the
performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the
award (the vesting period).
The cumulative expense recognised for equity-settled transactions at each balance date until vesting date reflects (i) the extent to which
the vesting period has expired and (ii) the Company’s best estimate of the number of equity instruments that will ultimately vest. No
adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the
determination of fair value at grant date. The statement of comprehensive income charge or credit for a period represents the movement
in cumulative expense recognised as at the beginning and end of that period.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is only conditional upon a market
condition.
If the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been modified. In
addition, an expense is recognised for any modification that increases the total fair value of the share-based payment arrangement, or is
otherwise beneficial to the employee, as measured at the date of modification.
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P a g e | 34
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
If an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised for
the award is recognised immediately. However, if a new award is substituted for the cancelled award and designated as a replacement
award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the original award, as
described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of earnings per share, refer
Note 5.
Cash settled transactions:
The Company also provides benefits to employees in the form of cash-settled share-based payments, whereby employees render services
in exchange for cash, the amounts of which are determined by reference to movements in the price of the shares of Company.
The cost of cash-settled transactions is measured initially at fair value at the grant date using the Black-Scholes formula taking into account
the terms and conditions upon which the instruments were granted, refer Note 20. This fair value is expensed over the period until vesting
with recognition of a corresponding liability. The liability is remeasured to fair value at each balance date up to and including the
settlement date with changes in fair value recognised in profit or loss.
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. Incremental costs directly attributable to the issue of new shares or options for the
acquisition of a new business are not included in the cost of acquisition as part of the purchase consideration.
Earnings per share
(u)
Basic earnings per share is calculated as net profit attributable to members of the parent, adjusted to exclude any costs of servicing equity
(other than dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any
bonus element.
Diluted earnings per share is calculated as net profit attributable to members of the parent, adjusted for:
•
•
•
costs of servicing equity (other than dividends) and preference share dividends;
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognised as
expenses; and
other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential
ordinary shares; divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for
any bonus element.
(v)
Going Concern
The financial report has been prepared on a going concern basis which is based on the realisation of the future potential of the Company’s
assets and discharge of its liabilities in the normal course of business.
As disclosed in the financial statements, the Company has incurred a net loss after tax for the year ended 30 June 2018 of $5,531,257
(2017: $3,398,989) and had net cash outflows from operating activities of $5,699,018 (2017: $3,652,918). As at 30 June 2018, the
Company has a net current asset position of $5,461,343 (2017: $6,193,036).
The net current asset position as at 30 June 2018 includes the following:
- cash at bank of $3,790,081 (2017: $5,249,614);
- Income tax benefit receivable $1,560,000 (2017: $1,080,000);
- inventories of $656,437 (2017: $509,402)
The Directors consider that the Company is a going concern however current cash flow forecasts indicate that the Company will need to
generate sufficient revenue from its operations or other sources to continue as a going concern. As the Company is in the formative
stages of its business model there exists circumstances that give rise to a material uncertainty in relation to going concern.
Should the Company be unsuccessful in generating sufficient revenue from operations or additional sources of funding, there is a material
uncertainty that may cast significant doubt as to whether the company will able to continue as a going concern and be able to realise its
assets and extinguish its liabilities in the normal course of business.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 35
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Notwithstanding the above, the Directors believe there are reasonable grounds to believe that the Company will be able to continue as
a going concern after consideration of the following factors:
- The current business development prospects show an increase in activity and should lead to increasing ongoing revenue and net cash
flows which as has been documented in the Company’s cash flow forecast for the period ending 30 September 2019;
- The Directors remain committed to the long-term business plan that is contributing to improved results as the business progresses;
- The budgets and forecasts reviewed by the Directors for the next twelve months anticipate the business will continue to produce
improved cash flow results, including proceeds from the expected exercise of existing options before their expiry at 31 December 2018;
and
- The Directors and the business have a successful track record of capital raising and have the option of seeking further funding to support
working capital and the R& D activities of the Company by way of equity capital.
The Directors are of the opinion that these factors will allow the Company to focus on growth areas and on improving profitability. The
Directors continue to monitor the situation closely and are focused on taking all measures necessary to optimise the Company’s
performance.
The Directors believe that the above indicators demonstrate that the Company will be able to pay its debts as and when they become
due and payable and to continue as a going concern and be in a position to realise its assets and settle its liabilities and commitments in
the normal course of business and at the amounts stated in the financial report. Accordingly, the Directors also believe that it is
appropriate to adopt the going concern basis in the preparation of the financial statements.
No adjustments have been made to the recoverability and classification of recorded asset values and the amount and classification of
liabilities that might be necessary should the company not continue as a going concern.
NOTE 2: SEGMENT REPORTING
The Company only operated in one segment, being design, development and manufacture of 3D metal printers and associated products
and services for the year ended 30 June 2018 and the year ended 30 June 2017.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 36
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 3: REVENUE AND EXPENSES
(a) Revenue
Sale of Goods
Total
(b) Other Income
Interest received
Total
(c) Research and Development expenses*
Consultancy fees
Consumables, design and engineering services
Total
(d) Other Expenses
Freight and Courier
Insurance
Software
Travel
Bad debts written off
Payroll Tax
Other
Total
30 June 18
30 June 17
$
$
329,970
329,970
79,647
79,647
251,266
1,069,819
1,321,085
117,398
166,413
75,380
235,887
56,489
149,428
252,219
1,053,214
237,995
237,995
52,255
52,255
157,843
346,749
504,592
80,911
59,465
55,727
128,380
-
72,228
179,638
576,349
* Research and Development expenses relate to direct expenses only. It should be noted that a significant portion of
Employee Benefits and Other Costs is considered eligible expenses for R&D tax claim purposes.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 37
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 4: INCOME TAX
(a) Income tax benefit
(b) Numerical reconciliation between tax-benefit and pre-tax net
loss
(Loss) from ordinary activities
Income tax using the Company’s tax rate of 27.5% (27.5% 2017)
Current period (loss) for which no deferred tax liability was
recognised
Income tax benefit relating to Research and Development claim
Income tax benefit attributable to entity
(c) Unrecognised deferred tax
Tax losses for which no deferred tax asset has been recognised
Losses available for offset against future taxable income
Total
Potential tax benefits of 27.5% (27.5% 2017)
30 June 18
$
1,532,717
30 June 17
$
1,403,927
(7,063,974)
(1,942,593)
1,942,593
1,532,717
1,532,717
30 June 18
$
10,391,043
10,391,043
2,857,537
(4,802,916)
(1,320,801)
1,320,801
1,403,927
1,403,927
30 June 17
$
4,859,786
4,859,786
1,336,441
The benefit of deferred tax assets not brought to account will only be brought to account if:
•
•
•
future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;
the conditions for deductibility imposed by tax legislation continue to be complied with; and
no changes in tax legislation adversely affect the Company in realising the benefit.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 5: ISSUED CAPITAL
a) Ordinary Shares
30 Jun 18
30 Jun 18
30 Jun 17
30 Jun 17
Number
$
Number
$
Movements in ordinary shares on issue
Balance at beginning of the year
57,900,000
10,345,506
Shares issued
Sub total
Less share issue costs
Balance at end of year
7,699,271
5,389,803
65,599,271
15,735,309
40,000,000
17,900,000
57,900,000
1,365,625
10,020,000
11,385,625
-
(503,288)
-
(1,040,119)
65,599,271
15,232,021
57,900,000
10,345,506
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number
of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or proxy, is entitled to one vote, and upon a poll each
share is entitled to one vote.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
NOTE 5: ISSUED CAPITAL (continued)
b) Performance Shares
2017
Movements in performance shares on issue
Balance at beginning of year
Performance Shares issued
Total at end of year to 30 June 2017
Class A
Number
Class B
Number
Class C
Number
Total
Number
6,300,000
-
6,300,000
7,087,500
-
7,087,500
7,612,500
-
7,612,500
21,000,000
-
21,000,000
2018
Class A
Number
Class B
Number
Class C
Number
Total
Number
Balance at beginning of year
6,300,000
7,087,500
7,612,500
21,000,000
Performance Shares redeemed and cancelled
(6,300,000)
-
-
-
Total at end of year to 30 June 2018
-
7,087,500
7,612,500
14,700,000
Performance Shares were all issued for nil consideration.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 39
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
Performance Shares hold no rights over ordinary shares and do not receive any dividends, however convert to Ordinary Shares based on
Company Milestones being achieved:
•
•
•
A Class A Performance Share in the relevant class will convert into one Share upon achievement of Aurora (or an entity controlled
by Aurora) having cumulative revenue of A$1,500,000 before 30 June 2017..On 7 July 2017, 6,300,000 Class A Performance
Shares were automatically redeemed and cancelled as the relevant milestone for their conversion was not satisfied by 30 June
2017. Refer Aurora’s announcement to ASX dated 14 July 2017 (‘Release of Options from Escrow & other changes to Securities’).
A Class B Performance Share in the relevant class will convert into one Share upon achievement of Aurora (or an entity controlled
by Aurora) having cumulative revenue of A$5,000,000 before 30 June 2018..On 12 July 2018, 7,087,500 Class B Performance
Shares were automatically redeemed and cancelled as the relevant milestone for their conversion was not satisfied by 30 June
2018. Refer Aurora’s announcement to ASX dated 12 July 2018 (‘Changes to Company Securities and Appendix 3Y’).
A Class C Performance Share in the relevant class will convert into one Share upon achievement of Aurora (or an entity controlled
by Aurora) having cumulative revenue of A$7,250,000 before 30 June 2019.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 40
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 5: ISSUED CAPITAL (continued)
c) Reserves
Reserves
Balance at beginning of year
Option Reserve
Balance at the end of the year
30 June 18
$
1,197,484
315,722
1,513,206
30 June 17
$
57,500
1,139,984
1,197,484
This reserve is used to record the value of equity benefits provided to employees and Directors as part of their remuneration. Refer to
Note 6 for further details.
d) Loss per share
30 June 18
30 June 17
Total loss from continuing operations
Weighted number of average shares
$5,531,257
60,589,796
$3,398,989
54,013,973
Loss per share
$0.091
$0.063
e) Dividends
There were no dividends declared or paid in the year to 30 June 2018 or the period to 30 June 2017.
NOTE 6: COMPANY OPTIONS
Company Options
30 June 18
30 June 18
30 June 17
30 June 17
Number
$
Number
$
Balance at the beginning of the year
Options issued
Options exercised
Balance at the end of year
12,561,000
4,553,000
(1,307,075)
15,806,925
1,197,484
315,722
-
5,750,000
6,911,000
(100,000)
57,500
1,139,984
-
1,513,206
12,561,000
1,197,484
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 41
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
The following options were in place during the current and prior periods:
Number
Grant date
Expiry date
Exercise
price
Fair value
Vesting date
at grant date
Employee options
Employee options
Options issued under IPO
prospectus
Employee Incentive Plan
Employee Incentive Plan
Employee Incentive Plan
Employee Incentive Plan
Employee Incentive Plan
Employee Incentive Plan
Employee Incentive Plan
Employee Incentive Plan
Employee Incentive Plan
Employee Incentive Plan
Placement
Placement
1,500,000
4,250,000
5,500,000
23 Nov 15
31 Dec 15
10 May 18
31 Dec 15
3 Aug 16
31 Dec 15
225,000
641,000
255,000
290,000
40,000
432,000
50,000
100,000
45,000
200,000
500,000
22 Nov 16
30 Nov 19
14 Mar 17
31 Mar 20
12 Jun 17
12 Jun 17
12 Jul 17
29 Aug 17
3 Oct 17
29 Nov 17
29 Nov 17
17 Apr 18
17 Apr 18
30 Nov 19
31 Mar 20
30 Jun 20
31 Aug 20
30 Sep 20
31 Jul 20
31 Aug 20
31 Jan 21
17 April 20
3,686,000
17 Apr 18
17 Apr 20
$
$0.20
$0.20
$0.20
$2.23
$3.00
$2.23
$3.00
$1.17
$0.79
$0.72
$0.95
$0.79
$1.08
$1.00
$1.00
$
$0.20
$0.20
$0.20
$0.29
$1.17
$0.29
$0.28
$0.26
$0.30
$0.23
$0.48
$0.45
$0.24
-
-
23 Nov 15
31 Dec 15
31 Dec 15
22 Nov 16
14 Mar 17
12 Jun 17
12 Jun 17
12 Jul 17
29 Aug 17
3 Oct 17
29 Nov 17
29 Nov 17
17 Apr 18
17 Apr 18
17 Apr 18
The fair value of the equity-settled share options granted is estimated as at the date of grant using the Black-Scholes model taking into
account the terms and conditions upon which the options were granted. Share options issued prior to listing on the ASX have not been
valued using the Black Scholes model.
NOTE 7: CASH AND CASH EQUIVALENTS
Cash at hand and in bank
Term Deposits
Total
30 June 18
$
1,990,081
1,800,000
3,790,081
30 June 17
$
1,228,655
4,020,959
5,249,614
Cash at bank earns interest at floating rates based on daily deposit rates.
The Company did not engage in any non-cash financing activities for the year ended 30 June 2018.
Reconciliation to the Statement of Cash Flows:
For the purposes of the statement of cash flows, cash and cash equivalents comprise cash on hand and at bank and investments in money
market instruments, net of outstanding bank overdrafts.
Cash and cash equivalents as shown in the statement of cash flows is reconciled to the related items in the statement of financial position
as follows:
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 42
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
Cash and cash equivalents
Total
Reconciliation of loss after tax to net cash outflow from operating activities:
Loss for the year/period
Adjustment for non-cash income and expense items
Depreciation
Equity settled share-based payments
Bad debt expenses
Change in assets and liabilities
Increase in trade and other receivables
Increase in annual leave accrual
Increase in inventories
Decrease in trade and other payables
Net cash outflow from operating activities
30 June 18
$
3,790,081
3,790,081
30 June 18
$
(5,531,257)
158,899
265,722
56,489
(484,450)
60,338
(147,035)
(77,724)
(5,699,018)
30 June 17
$
5,249,614
5,249,614
30 June 17
$
(3,398,989)
28,419
1,084,984
-
(1,342,274)
107,726
(405,504)
272,720
(3,652,918)
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 43
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 8: TRADE AND OTHER RECEIVABLES
Bank guarantee
Accounts Receivable
GST
Advances to suppliers
Interest receivable
Other receivables
Income tax benefit receivable
Pre-paid expenses
Total
NOTE 9: INVENTORIES
Stock on Hand
Raw materials – Powders at cost
Work in progress – Small Format Printers at cost
Total
Parts used in development were classified as research and development and expensed.
NOTE 10: PROPERTY, PLANT AND EQUIPMENT
(i)Carrying value
30 June 18
$
92,959
-
33,712
15,203
2,702
57,777
1,560,000
44,671
1,806,024
30 June 18
$
228,025
32,972
395,440
656,437
30 June 17
$
117,959
61,361
86,678
10,979
11,075
-
1,080,000
65,127
1,433,179
30 June 17
$
190,690
15,107
303,605
509,402
Cost
Accumulated depreciation and
impairment
Plant and
Equipment
$
206,115
(26,130)
Computers and
Cameras
$
202,686
(60,944)
Office
Equipment
$
Leasehold
Improvements
$
Total
$
70,368
(9,780)
185,692
(92,845)
664,861
(189,699)
Carrying value as at 30 June 2018
179,985
141,742
60,588
92,847
475,162
Cost
Accumulated depreciation and
impairment
131,656
(7,153)
125,220
(20,571)
34,538
(3,086)
96,477
-
387,891
(30,810)
Carrying value as at 30 June 2017
124,503
104,649
31,452
96,477
357,081
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 44
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 10: PROPERTY, PLANT AND EQUIPMENT (continued)
(ii)Reconciliation
Plant and
Equipment
$
124,503
74,475
(18,993)
179,985
6,550
124,606
(6,653)
124,503
Computers and
Cameras
$
104,649
77,457
(40,364)
141,742
2,593
121,956
(19,900)
104,649
Office
Equipment
$
Leasehold
Improvements
$
31,452
35,831
(6,695)
60,588
3,630
29,688
(1,866)
31,452
96,477
89,217
(92,847)
92,847
-
96,477
-
96,477
Total
357,081
276,980
(158,899)
475,162
12,773
372,727
(28,419)
357,081
Carrying value as at 1 July 2017
Additions
Depreciation expense
Balance at end of year
Carrying value as at 1 July 2016
Cost
Depreciation expense
Balance at end of year
NOTE 11: INTANGIBLES
(i) Carrying amount
Intangibles consist of patents lodged by the Company
Cost
Impairment (for lapsed or forfeited patents)
Balance at end of year
(ii) Reconciliation
Intangibles consist of patents lodged by the Company
Balance at the beginning of the year
Capitalised payments for patent related costs
Less impairment (for lapsed or forfeited patents)
Balance at end of year
30 June 18
$
513,467
(3,330)
510,137
30 June 18
$
225,545
287,922
(3,330)
510,137
30 June 17
$
225,545
-
225,545
30 June 17
$
59,947
165,598
-
225,545
Patents that have lapsed or are forfeited and are not rolled into a new patents have been impaired and moved to an expense in the year
the patents lapsed/expired.
NOTE 12: FINANCIAL LIABILITIES
Trade and other payables
Accounts Payable
Other payables
Sub Total
Deferred Revenue - Deposits / pre-payments for Small Format Printers
Accrued annual leave
Total
30 June 18
$
30 June 17
$
320,478
234,706
555,184
52,534
184,481
792,199
206,474
426,434
632,908
242,108
124,143
999,159
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 45
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 13: SIGNIFICANT EVENTS AFTER THE BALANCE DATE
On 12 July 2018, 7,087,500 Class B Performance Shares were automatically redeemed and cancelled as the relevant milestone for their
conversion was not satisfied by 30 June 2018. Refer Aurora’s announcement to ASX dated 12 July 2018 ‘Changes to Company Securities’.
On 16 August 2018 32,260,696 Shares and 9,092,500 Unquoted options (exercisable at $0.20 and expiring 31 December 2018) were
released from escrow.
Other than the above, there have been no other matters or circumstances which has arisen since 30 June 2018 that has significantly
affected or may significantly affect:
a) Aurora Labs operations in future financial years; or
b) The results of those operations in future financial years; or
c) Aurora Labs state of affairs in future financial years.
NOTE 14: DIVIDENDS
The Directors of the Company have not declared any dividend for the year ended 30 June 2018 or the period ended 30 June 2017.
NOTE 15: COMMITMENTS
As at the balance date, the Company has a total of 7 Small Format Printers that were either: pre-sold at discount rates to various non-
related parties as part of a crowd-funding initiative called “kickstarter”; or full price pre-sales in financial year ended June 2018. In total a
liability of $52,534 is recognised on the statement of financial position which corresponds to funds received from these pre-sales.
The Company has an obligation to either a) deliver a commercial version of the pre-sold Small Format Printer for each pre-sold machine
or b) if the Company is unable to deliver commercial Small Format Printers to cover the pre-sold machines then the funds received will
have to be returned to the customers.
Lease Agreement
The Company leased a warehouse and office space at Unit 2, 79 Bushland Ridge Bibra Lake, Western Australia: The rental agreement
commenced 1 June 2017 with an initial 24-month period that can be extended, there is a payment of $24,318 per month plus standard
outgoings.
Lease commitments
Not longer than 1 year
Longer than 1 year and shorter than 5 years
Total
30 June 18
30 June 17
$
$
267,493
-
267,493
289,152
265,056
554,208
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
P a g e | 46
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 16: FINANCIAL INSTRUMENTS
a) Overview
The Company's principal financial instruments comprise receivables, payables and cash. The main risks arising from the Company's financial
instruments are credit risk, liquidity risk, interest rate risk and foreign currency risk. This note presents information about the Company's
exposure to each of the above risks, its objectives, policies and processes for measuring and managing risk, and the management of capital.
Other than as disclosed, there have been no significant changes since the previous financial year to the exposure or management of these
risks.
The Company manages its exposure to key financial risks in accordance with the Company's risk management policy. Key financial risks are
identified and reviewed annually, and policies are revised as required. The overall objective of the Company's risk management policy is
to recognise and manage risks that affect the Company and to provide a stable financial platform to enable the Company to operate
efficiently.
The Company does not enter into derivative transactions to mitigate the financial risks. In addition, the Company's policy is that no trading
in financial instruments shall be undertaken for the purposes of making speculative gains. As the Company's operations change, the
Directors will review this policy periodically going forward.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework. The Board reviews
and agrees policies for managing the Company's financial risks as summarised below.
b) Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The
Company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral where appropriate, as a
means of mitigating the risk of financial loss from defaults.
The Company only transacts with entities that are rated the equivalent of investment grade and above. This information is supplied by
independent rating agencies where available and, if not available, the Company uses publicly available financial information and its own
trading record to rate its major customers.
The Company does not have any significant credit risk exposure to any single counterparty or any Company of counterparties having similar
characteristics.
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual
obligations. This arises principally from cash and cash equivalents and trade and other receivables.
There are no significant concentrations of credit risk within the Company. The carrying amount of the Company's financial assets
represents the maximum credit risk exposure, as represented below:
Cash and cash equivalents
Trade and other receivables
Total
30 Jun 18
$
3,790,081
1,807,024
5,546,105
30 Jun 17
$
5,249,614
1,433,179
6,682,793
Trade and other receivables are comprised primarily of advances to suppliers, bank guarantee, prepayments, interest receivable and GST
refunds due. Where possible the Company trades only with recognised, creditworthy third parties. It is the Company's policy that all
customers who wish to trade on credit terms are subject to credit verification procedures.
With respect to credit risk arising from cash and cash equivalents, the Company's exposure to credit risk arises from default of the counter
party, with a maximum exposure equal to the carrying amount of these instruments.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 16: FINANCIAL INSTRUMENTS (continued)
c) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Board's approach to
managing liquidity is to ensure, as far as possible, that the Company will always have sufficient liquidity to meet its liabilities when due by
continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.
The contractual maturities of financial liabilities, including estimated interest payments, are provided below. There are no netting
arrangements in respect of financial liabilities.
2018
Financial Liabilities
Trade and other payables
Deferred revenue
Accrued annual leave
Total
2017
Financial Liabilities
Trade and other payables
Deferred revenue
Accrued annual leave
Total
d) Interest Rate Risk
≤6 Months
$
6-12 Months
$
1-5 Years
$
≥5 Years
$
555,184
52,534
184,481
792,199
-
-
-
-
-
-
-
-
-
-
≤6 Months
$
6-12 Months
$
1-5 Years
$
≥5 Years
$
632,908
242,108
124,143
999,159
-
-
-
-
-
-
-
-
-
-
-
-
Total
$
555,184
52,534
184,481
792,199
Total
$
632,908
242,108
124,143
999,159
The Company's exposure to the risk of changes in market interest rates relates primarily to the cash and short-term deposits with a floating
interest rate.
These financial assets with variable rates expose the Company to cash flow interest rate risk. All other financial assets and liabilities, in
the form of receivables and payables are non-interest bearing.
At the reporting date, the interest rate profile of the Company's interest-bearing financial instruments was:
Interest-bearing financial instruments
Cash at bank and on hand
Term Deposits
Total
30 Jun 18
30 Jun 17
$
$
1,990,081
1,800,000
3,790,081
1,228,655
4,020,959
5,249,614
The Company's cash at bank and on hand and short-term deposits had a weighted average floating interest rate at year end of 1.97%
(2017: 1.68%).
The Company currently does not engage in any hedging or derivative transactions to manage interest rate risk.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 16: FINANCIAL INSTRUMENTS (continued)
Interest rate sensitivity
The Company considers that a 1% movement in interest rates would result in an immaterial impact on equity and the profit and loss.
e) Foreign Exchange Risk
The Company's has an exposure to foreign exchange rates given that the Company purchases parts as part of the manufacture process of
the SFP from international suppliers. A fluctuation in foreign exchange rates may affect the cost base of the SFP. The Company is actively
marketing the SFP to international customers in USD. If foreign exchange rates change this may make the SFP more or less price
competitive with competitor’s metal 3D printers. Given the Company is not yet in production it is too early to quantify the financial impact
of foreign exchange risk.
f) Fair values
The net fair value of financial assets and financial liabilities approximates their carrying value. The methods for estimating fair value are
outlined in the relevant notes to the financial statements.
NOTE 17: CONTINGENT LIABILITIES / ASSETS
The Company had no contingent liabilities or assets as at the reporting date.
NOTE 18: KEY MANAGEMENT PERSONNEL
a) Key Management Personnel
The KMP of the Company during or since the end of the financial year were as follows:
Directors
Position
KMP
David Budge
Nathan Henry
Mathew Whyte
Samantha Tough
Paul Kristensen
Mel Ashton
Position
Managing Director
Executive Director
Company Secretary ; and Non-Executive Director
Non- Executive Chairman
resigned 25 July 2017
Non- Executive Chairman
appointed 22 January 2018
Non-Executive Director
appointed 22 January 2018
b) Key Management Personnel Compensation
Short-term employee benefits
Post- employment benefits
Share-based payments
Total compensation
30 Jun 18
30 Jun 17
$
$
695,896
47,283
114,337
857,516
553,450
43,463
213,226
810,139
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NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 19: KEY MANAGEMENT PERSONNEL (continued)
c) Other Transactions
Mathew Whyte provided company secretarial services through a controlled entity Whypro Corporate Services. Payments for company
secretarial services during the year totalled: $115,200 (2017: $70,400).
These items have been recognised as expenses in the Statement of Comprehensive Income.
NOTE 20: SHARE-BASED PAYMENTS
a) Recognised Share-based Payment Expense
From time to time, the Company provides incentive options to officers, employees, consultants and other key advisors as part of
remuneration and incentive arrangements. The number of options granted, and the terms of the options granted are determined by the
Board. Shareholder approval is sought where required. During the past two years, the following equity-settled share-based payments
have been recognised:
Expense arising from equity-settled share-based payment
transactions
Net share based payment expense/(income) recognised
in the profit or loss
b) Remaining Contractual Life
30 June 18
Number
30 June 18
30 June 17
30 June 17
$
Number
$
867,000
265,722
1,411,000
1,084,984
867,000
265,722
1,411,000
1,084,984
All Incentive Options outstanding at 30 June 2018 are able to be exercised prior to 31 January 2021, so there is 2.5 years remaining
contractual life on all options as at the balance date (2017: 1.5 years).
c) Range of Exercise Prices
The exercise price of Incentive Options outstanding at 30 June 2018 are detailed in Note 6.
d) Weighted Average Fair Value
The fair value of all options issued during the year was $0.01 per option.
e) Option Pricing Model
The fair value of the equity-settled Company Options granted is estimated as at the date of grant using an internal valuation methodology
taking into account the terms and conditions upon which the options were granted. In conjunction to the internal valuation model, the
Board gave consideration to the market price for options being issued at arm’s length during and since the end of the reporting date.
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NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2018
NOTE 21: AUDITORS REMUNERATION
AUDITORS' REMUNERATION
Amounts received or due and receivable by HLB Mann Judd for:
an audit or review of the financial report of the entity
other services in relation to the entity
Total
30 Jun 18
30 Jun 17
$
$
26,500
-
24,500
24,500
-
24,500
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DIRECTORS DECLARATION
1.
In the opinion of the Directors of Aurora Labs Limited (“Aurora” or the “Company”):
a.
the accompanying financial statements and notes are in accordance with the Corporations Act 2001 including:
i.
ii.
giving a true and fair view of the Company’s financial position as at 30 June 2018 and of its performance for the year
then ended; and
complying with Australian Accounting Standards, the Corporations Regulations 2001, professional reporting
requirements and other mandatory requirements.
b.
c.
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and
payable.
the financial statements and notes thereto are in accordance with International Financial Reporting Standards issued by the
International Accounting Standards Board.
2.
This declaration has been made after receiving the declarations required to be made to the Directors in accordance with Section
295A of the Corporations Act 2001 for the financial year ended 30 June 2018.
This declaration is signed in accordance with a resolution of the Board of Directors.
______________________________
David Budge
Managing Director
Dated this 21 August 2018
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Independent Auditor’s Report to the Members of Aurora Labs Limited
REPORT ON THE AUDIT OF THE FINANCIAL REPORT
Opinion
We have audited the financial report of Aurora Labs Limited (“the Company”) which comprises the
statement of financial position as at 30 June 2018, the statement of profit or loss and other
comprehensive income, the statement of changes in equity and the statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant accounting
policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Company is in accordance with the
Corporations Act 2001, including:
a) giving a true and fair view of the Company’s financial position as at 30 June 2018 and of its
financial performance for the year then ended; and
b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Company in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (“the Code”) that are relevant to our audit of the financial report in Australia. We have
also fulfilled our other ethical responsibilities in accordance with the Code.
We 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.
Material Uncertainty Regarding Going Concern
We draw attention to Note 1 in the financial report, which indicates that a material uncertainty exists
that may cast significant doubt on the Company’s ability to continue as a going concern. Our opinion
is not modified in respect of this matter.
HLB Mann Judd (WA Partnership) ABN 22 193 232 714
Level 4 130 Stirling Street Perth WA 6000 | PO Box 8124 Perth BC WA 6849 | Telephone +61 (08) 9227 7500 | Fax +61 (08) 9227 7533
Email: mailbox@hlbwa.com.au | Website: www.hlb.com.au
Liability limited by a scheme approved under Professional Standards Legislation
HLB Mann Judd (WA Partnership) is a member of International, a world-wide organisation of accounting firms and business advisers
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context
of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. In addition to the matter described in the Material
Uncertainty Related to Going Concern section, we have determined the matters described below to
be the key audit matters to be communicated in our report.
Key Audit Matter
Share Based payments
Refer to Note 20
During the financial year the Company issued
unlisted options to Key Management Personnel and
employees.
We have considered this to be a key audit matter as
where accounting for the transactions requires
involving
significant management
estimates that require a degree of estimation.
judgement
Research and development expenditure
Refer to Notes 1(p) and 3(c)
During the current year, the Company incurred
significant expenditure in relation to medium, large
format printers and powder production unit. The
Company is in the process of developing its 3D
printer and powder production unit designs as it
moves toward commercialisation of its various
designs.
We considered the accounting for this expenditure
to be a key audit matter due to the complexity of
determining an appropriate accounting policy and
the high
required by
management in assessing the stage of the process.
level of estimation
How our audit addressed the key audit
matter
Our procedures included but were not
limited to:
- We evaluated management's process
and key controls regarding share based
payments;
- Ensured that the treatment of the
share-based payment arrangements
entered into by the Company were
consistent with the requirements of
AASB 2 Share-based payment; and
in
calculation of the value of options.
inputs used
- Testing
the
the
Our procedures included but were not
limited to:
- We evaluated management's process
and key controls regarding research and
development expenditure; and
- We
considered
management’s
assessment of whether or not various
expenditures met the definition for
deferral as development expenditure
under AASB 138 Intangible asset.
Information Other than the Financial Report and Auditor’s Report Thereon
The directors are responsible for the other information. The other information comprises the
information included in the Company’s annual report for the year ended 30 June 2018, but does not
include the financial report and our auditor’s report thereon.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due
to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Company
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 Company or
to cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company’s ability to continue as a
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial report or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
We communicate with the directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control that
we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter
should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
REPORT ON THE REMUNERATION REPORT
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 11 to 19 of the directors’ report for the
year ended 30 June 2018.
In our opinion, the Remuneration Report of Aurora Labs Limited for the year ended 30 June 2018
complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
HLB Mann Judd
Chartered Accountants
Perth, Western Australia
21 August 2018
N G Neill
Partner
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ASX ADDITIONAL INFORMATION
Additional information required by the Australian Securities Exchange Limited Listing Rules and not disclosed elsewhere in this report.
COMPANY SECURITIES
The following information is based on share registry information processed up to 16 August 2018.
Quoted Securities
There are two classes of quoted securities, being:
1.
2.
Fully paid ordinary shares (ASX: A3D);
Listed Options exercisable at $1.00 and expiring 17 April 2020 (ASX: A3DO).
1) Fully Paid Ordinary Shares
a) Distribution and spread of Ordinary shares
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Shares
Shareholders
401
584
329
512
67
1,893
Shares
240,598
1,737,177
2,667,710
14,390,875
46,562,911
65,599,271
b) Marketable parcel
There are 428 shareholders with less than a marketable parcel (basis price $0.42).
c) Voting rights
All ordinary shares carry one vote per share without restriction. Options and Performance Shares do not carry any voting rights.
d) Substantial Shareholders
There was one substantial shareholder who has provided a Substantial shareholder notice, being David Budge, holding 23,946,785 fully
paid ordinary shares, being 36.5% of the fully paid ordinary shares on issue.
e) On market buy-back
There is no on-market buy-back scheme in operation for the Company’s quoted shares.
Aurora Labs Limited ANNUAL FINANCIAL REPORT 2018
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ASX ADDITIONAL INFORMATION (continued)
f) Top 20 security holders
The names of the twenty largest holders of each class of quoted equity security, being fully paid ordinary shares, the number of equity
security each holds and the percentage of capital each holds is as follows:
Number
Shareholder Name / Entity
Number of Ordinary Shares
% of Issued Capital
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
David James Budge
Gasmere Pty Ltd
William McKenzie Crisp
Jessica C E Snelling
Citicorp Nom Pty Ltd
Peter Anthony
John Nathan Henry
Peterson MG & Wake SA
Theodore Lionel Chatz
Harry Hatch
Pabasa Pty Ltd
Kacha Pty Ltd
David R Parker
Anna Felicia Belton
Rodney Alan Brack
Anna Katherine Campbell
J P Morgan Nom Aust Ltd
Craig Ian Brown + JL Craig
Martin James Daley
Aileen & Arthur Budge
23,946,785
2,717,888
1,436,415
1,330,377
1,199,889
1,093,750
832,151
701,000
700,000
688,000
593,750
557,151
460,000
460,000
423,338
399,113
390,855
350,000
266,074
266,074
36.50
4.14
2.23
2.03
1.83
1.67
1.27
1.07
1.07
1.05
0.91
0.85
0.70
0.70
0.65
0.61
0.60
0.53
0.41
0.41
Total
38,839,610
59.23
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ASX ADDITIONAL INFORMATION (continued)
2) Listed Options:
Exercisable at $1.00 and expiring 17 April 2020 (ASX: A3DO)
a) Distribution and spread of Listed Options
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Listed Options
Option holders
1
26
19
69
6
121
Options
1,000
77,564
150,013
1,959,186
1,498,237
3,686,000
b) Marketable parcel
There are 19 option holders with less than a marketable parcel (basis price $0.12).
c) Top 20 security holders
The names of the twenty largest holders of Listed Options, the number of Options each holds, and the percentage of total issued Listed
Options each holds is as follows:
Number
Option Holders Name / Entity
Number of Listed Options
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
LTL Cap Pty Ltd
Rodney Alan Brack
Harrison John Perkins
Simon William Tritton
Michael Benedict Cookson
Luke Kukulj
Shellcrest Holdings Pty Ltd
D Super Pty Ltd
Kim Barbara Dowling
Ian Stuart Fisher
JDDD Super PL
Citicorp Nom PL
Spider Cap Ltd
HSBC Custody Nom Aust Ltd
Michelle Annette Solty
Lee Miller INV PL
Feltrim Past Co PL
Sunset River PL
Feltrim Past CO PL
Martin John Gardiner
440,625
408,987
214,375
158,000
150,000
126,250
100,000
91,272
88,000
80,000
68,586
65,105
62,500
62,500
45,000
43,750
42,500
40,000
36,875
35,625
% of Issued
Options
11.95
11.10
5.82
4.29
4.07
3.43
2.71
2.48
2.39
2.17
1.86
1.77
1.70
1.70
1.22
1.19
1.51
1.09
1.00
0.97
Total
2,359,950
64.06
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ASX ADDITIONAL INFORMATION (continued)
Unquoted Securities – Company Options and Performance Shares
There are two classes of unquoted securities, being:
Company Options: and
1.
2. Performance Shares.
1a) Company Options – Exercisable $0.20/ Expiry 31 December 2018
Distribution & Spread of unquoted Options holder numbers
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Options
Option holders
1
5
3
13
15
37
1b) Company Options – Exercisable $2.23/ Expiry 30 November 2019
Distribution & Spread of unquoted Options holder numbers
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Options
Option holders
-
-
1
7
2
10
1c) Company Options – Exercisable $3.00/ Expiry 31 Mar 20
Distribution & Spread of unquoted Options holder numbers
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Options
Option holders
-
-
1
17
2
20
Options
500
22,500
30,000
547,425
9,257,500
9,857,925
Options
-
-
10,000
215,000
255,000
480.000
Options
-
-
10,000
631,000
290,000
931,000
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ASX ADDITIONAL INFORMATION (continued)
1d) Company Options – Exercisable $1.17/ Expiry 30 Jun 2020
Distribution & Spread of unquoted Options holder numbers
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Options
Option holders
Options
-
-
1
-
10
-
-
-
40,000
-
40,000
1e) Company Options – Exercisable $0.72/ Expiry 30 September 2020
Distribution & Spread of unquoted Options holder numbers
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Options
Option holders
Options
-
-
1
-
1
-
-
-
50,000
-
50,000
1f) Company Options – Exercisable $0.95/ Expiry 31 September 2020
Distribution & Spread of unquoted Options holder numbers
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Options
Option holders
Options
-
-
1
-
1
-
-
-
100,000
-
100,000
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ASX ADDITIONAL INFORMATION (continued)
1f) Company Options – Exercisable $0.95/ Expiry 31 September 2020
Distribution & Spread of unquoted Options holder numbers
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Options
Option holders
Options
-
-
1
-
1
-
-
-
100,000
-
100,000
1g) Company Options – Exercisable $1.08/ Expiry 31 January 2021
Distribution & Spread of unquoted Options holder numbers
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Ordinary Options
Option holders
Options
-
-
2
-
2
-
-
-
200,000
-
200,000
2.
Performance Shares - Class C
Distribution of unquoted Performance Shares Class C
.
Category
(Size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Performance Shares
Class C
Shareholders
Shares
-
2
2
44
5
53
-
4,460
17,844
1,320,646
6,269,550
7,612,500
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ASX ADDITIONAL INFORMATION (continued)
2b) Holders of more than 20% of unquoted Performance Shares (Class B & Class C)
Performance Shares Class C: David Budge owns 5,341,975 Performance Shares Class C which is equal to 70.2% of the Performance
Shares Class C on issue.
PERFORMANCE SHARES
The Company provides the following information in relation to Performance Shares (ASX Code: A3DAJ):
1.
2.
3.
4.
5.
6.
7.
Number of Performance Shares at the beginning of the financial year ended 30 June 2018 was 21,000,000, comprising:
a) 6,300,000 Class A Performance Shares;
b) 7,087,500 Class B Performance Shares; and
c) 7,612,500 Class C Performance Shares.
Each Performance Share will convert into a fully paid ordinary shares (Shares), on a one-for-one basis, upon the satisfaction of the
following milestones (Milestones):
a)
for Class A Performance Shares – upon achievement of Aurora (or an entity controlled by Aurora) having cumulative revenue
of A$1,500,000 before 30 June 2017;
b) for Class B Performance Shares – upon achievement of Aurora (or an entity controlled by Aurora) having cumulative revenue
c)
of A$5,000,000 before 30 June 2018; and
for Class C Performance Shares – upon achievement of Aurora (or an entity controlled by Aurora) having cumulative revenue
of A$7,250,000 before 30 June 2019.
If the relevant Milestone for a class of Performance Share is not achieved by the required date, then each Performance Share in
that class will be automatically redeemed and cancelled by Aurora for the sum of $0.00001 within 10 business days of non-
satisfaction of that Milestone.
None of the Performance Shares in any class were converted or cancelled during the year.
On 7 July 2017 6,300,000 Class A Performance Shares were automatically redeemed and cancelled as the relevant Milestone for
their conversion was not satisfied by the required dated (i.e. by 30 June 2017). Refer Aurora’s announcement to ASX dated 14 July
2017 (‘Release of Options from Escrow & other changes to Securities’).
Since the end of the financial year on 12 July 2018 7,087,500 Class B Performance Shares were automatically redeemed and
cancelled as the relevant Milestone for their conversion was not satisfied by the required dated (i.e. by 30 June 2018). Refer
Aurora’s announcement to ASX dated 12 July 2018 (‘Changes to Company Securities”).
No Milestones were met during the financial year in review.
OTHER ASX INFORMATION
1. Corporate Governance
The Company’s Corporate Governance Statement as at 30 June 2018 as approved by the Board can be viewed at www.auroralabs3d.com
2. Company Secretary
The name of the Company Secretary is Mathew Whyte.
3. Address and telephone details of the entity’s registered administrative office and principle place of business:
Unit 2/ 79 Bushland Ridge
Bibra Lake WA 6163
Telephone:
+61 (08) 9434 1934
Email:
enquiries@auroralabs3d.com
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ASX ADDITIONAL INFORMATION (continued)
4. Address and telephone details of the office at which a registry of securities is kept:
Security Transfer Registrars Pty Ltd
770 Canning Highway
APPLECROSS WA 6153
Telephone:
Fax:
(08) 9315 2333
(08) 9315 2233
5. Stock exchange on which the Company’s securities are quoted:
The Company’s listed equity securities are quoted on the Australian Securities Exchange under the code (ASX: A3D).
6. Review of Operations
A review of operations is contained in the Directors’ Report.
7. Consistency with business objectives - ASX Listing Rule 4.10.19
In accordance with Listing Rule 4.10.19, the Company states that it has used the cash and assets in a form readily convertible to cash that
it had at the time of admission in a way consistent with its business objectives. The business objective is primarily design, development
and manufacture of metal 3D printers and associated products and services.
The Company believes it has used its cash in a materially consistent manner to which was disclosed under the prospectus dated 9 June
2016.
8. Restricted Securities
The Company has no restricted securities as at the date of this report.
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