21 October 2003
The Manager Companies
Australian Stock Exchange Limited
20 Bridge Street
SYDNEY NSW 2000
Level 8, 261 George Street
Sydney NSW 2000
Tel: (61-2) 9247 8212
Fax: (61-2) 9247 3932
E-mail: pnightingale@biotron.com.au
Website: www.biotron.com.au
(33 pages by email)
Dear Madam
RE: ANNUAL REPORT
In accordance with Listing Rule 4.7, I attach the Company's Annual Report for the year ended 30 June
2003.
Yours sincerely
Peter J. Nightingale
Company Secretary
pjn2337
L I M I T E D
CHAIRMAN’S REPORT
The past year has been a year of challenge for Biotron. The Company has been deliberately focusing its
efforts on commercial development of the Company’s Tier 1 projects. These two projects, C-Test and Virion,
have enormous commercial potential, addressing unmet medical needs with huge potential markets. The
projects are the most advanced within the Company, and have the potential to generate returns in a shorter
time frame.
Scientific research is by nature unpredictable. No matter how well planned and executed, unexpected delays
can and do occur. This does not indicate that there are significant flaws in the underlying technologies. We
are committed to ensuring that Biotron’s projects have clear, strong competitive positions. At times this
means additional work has to be done to enhance aspects of a product to ensure that it will be the market
leader in its class. While these delays can be frustrating they will ultimately translate to increased returns to
shareholders. We are, however, ever mindful of the need to increase these returns in a timely fashion.
Significant progress has been made with the Virion Project during this past year. We have generated a large
number of compounds with increased ability to inhibit the Vpu protein of HIV-1. We are in the process of
determining which compound is most likely to be a successful drug candidate, and will be moving ahead
with preclinical testing with the aim of initiating clinical studies as soon as practicable and feasible from a
regulatory and safety perspective. The value of the Virion technology has been increased by design,
synthesis, testing and identification of additional series of compounds. In recent months, Biotron
researchers have extended the Virion technology to encompass a range of other very significant viral
diseases, including Hepatitis C virus, SARS coronavirus and dengue virus. As a consequence of this latest
work, Biotron has firmly cemented its hold on the viral ion channel field and has a very solid patent position
over a far broader range of therapeutic compounds and indications. This translates into a substantial
increase in the value of Virion, which will greatly benefit shareholders.
During the year we have been in on-going discussions with potential partners regarding the Virion
technology. While we are keen to secure a partner to take the compounds through into clinical development,
Biotron can vastly increase the value of the technology by undertaking an early clinical study in man before
forming an alliance. This will translate into much higher returns to the Company in the form of upfront
payments as well as increased milestone and royalty payments in the future.
The competitive position of C-Test has been significantly enhanced by marked improvements in sample
extraction and processing methodologies. The importance of having better, faster and cheaper methods of
sample handling should not be underestimated in developing a competitive diagnostic product. In addition,
we have developed a robust mathematical methodology for analysing the vast quantities of data generated
in the C-Test assays. These protocols will translate into more specific, sensitive cancer tests, and will facilitate
attracting a potential partner for the technology.
The Company’s key objective for 2003/4 is to increase the market’s understanding of the long-term strength
and benefit of Biotron’s technology and business. Biotron has an extraordinary depth of expertise available
to it from its Scientific Advisory Panel and various consultants. Biotron’s primary focus is on maximising
returns to shareholders. The Company continually exercises rigorous cost control to ensure it has sufficient
capital on hand to develop its technologies to a suitable stage for partnering.
On behalf of the shareholders and Directors, I would like to thank all Biotron staff for the untiring efforts
during the year. Thanks to their commitment and dedication, your Company is well placed to meet the next
stage of its development.
Yours sincerely
Michael J. Hoy
Chairman
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
REVIEW OF OPERATIONS
OVERVIEW
During the year ended 30 June 2003 there has been a continued focus on the commercial development of
the key biomedical projects managed and funded by the Company.
The following significant events were achieved during the year under review:
•
Independently conducted tests confirmed that the Virion Project’s BIT009 compound inhibits HIV-1
replication in human cells without harming human cell survival.
• Demonstration that proteins from Ross River and Barmah Forest viruses are able to form ion channels,
validating the Company’s position that viral proteins can form ion channels. This supports Biotron’s ion
channel platform technology, that proteins from other viruses, including the HIV-1 virus, form ion
channels and that these ion channels can be targeted to inhibit viral replication. The research was
published in the prestigious Journal of Biological Chemistry.
• Receipt of ARC Linkage Grants, in conjunction with the Australian National University (ANU), with a total
value of $414,000 for development of the Virion and Muscion Projects.
• Commencement of clinical trials of the Company’s CT-2 diagnostic test for detection of colorectal cancer
in conjunction with clinicians from the Sydney Colorectal Associates at the Prince of Wales Hospital and
St George Hospital, Sydney.
BIOTRON’S PROJECTS
Biotron has the rights to develop, exploit and commercialise six biomedical projects known as C-Test, Virion,
Muscion, Hypoxion, Gabion and GeneTrans. An independent valuation of the projects during the 2000-2001
financial year concluded that the Company’s projects have a value in the range $25.6 million to $36.8 million
with a mean valuation of $31.2 million. The Company has not revalued its projects for the purposes of the
financial report. If the Company were to adopt the independent expert’s mean valuation of $31.2 million for
the Company’s projects, the total assets reported on the Statement of Financial Position would be increased
by $31.2 million. This does not take into account the substantially increased value that has been added to the
projects during the subsequent two years.
As stated in the Financial Report for year ended 30 June 2002 and reiterated in the Update to Shareholders
earlier this year, the Company’s efforts are currently focused on commercial development of the Virion and
C-test Projects. These projects, the most advanced within the Company, have the potential to generate
returns in a shorter time frame.
Biotron’s model is to take projects such as C-Test and Virion through proof-of-concept studies into preclinical
and early-stage clinical development. The Company then aims to form partnerships and alliances with
international pharmaceutical or biotechnology companies for further late-stage clinical development and
marketing of products. Income received from such alliances will be committed to further the commercial
development of existing and new Tier 2 Projects.
The Company is committed to increasing shareholder value through the establishment of partnerships for
the clinical development of the C-Test and Virion Projects. Central to this is the expansion and strengthening
of Biotron’s intellectual property portfolio. Strong, defensible, international patents are essential to attract
partners and to ensure a competitive advantage for our products in the marketplace.
The remaining Tier 2 Projects are underpinned by a platform technology, research on ion channels in
membranes, which allows several scientists to work in different, yet related, areas of research with the
results of work in one area providing benefits to other research activities. Additional resources will be
committed to these projects once they reach specific commercially-focused milestones.
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
Virion
The Virion Project is aimed at developing novel antiviral agents that will interact with a new kind of target,
virus ion channels, to depress HIV replication. Biotron researchers have shown that a particular class of
compounds blocks the ion channel activity of one of the HIV proteins called Vpu, a new drug target in the
fight against HIV.
The Vpu protein represents a novel anti-HIV-1 drug target. It plays important roles in the budding and release
of newly formed viruses from infected cells, a process that is crucial for the progression of infection.
Due to the nature of the market, the seriousness of the disease and the lack of treatment options, compounds
for the treatment of AIDS may be fast tracked through clinical trials to market.
It is estimated that 36.1 million people are living with AIDS, with more than 5 million contracting the disease
in 2000.
Current anti-AIDS drug therapies primarily target the HIV-1 reverse-transcriptase and protease enzymes. To
counteract the ability of the HIV-1 virus to rapidly mutate and develop resistance, patients are given a cocktail
of drugs as part of a Highly Active Anti-Retroviral Therapy (HAART). Discovery and development of new anti-
HIV-1 drugs that attack different parts of the virus life cycle is essential in the continuing fight
against resistance.
There is a particular need for therapeutics that target HIV in a particular type of cell known as
monocyte/macrophages. Recent studies have shown that these cell types act as pools or reservoirs of virus
in HIV-infected individuals. Existing regimens of HAART are ineffective at attacking HIV-1 in those cells.
Biotron has shown that several related compounds significantly inhibit HIV replication in primary human
monocyte/macrophage cultures. The compounds are effective even at very low concentrations, inhibiting
replication by up to 100% compared to untreated controls, with no sign of toxicity at the low, effective
concentrations. The results are exciting as they open up the possibility of a new class of therapeutic agents
that will act in combination with existing therapies.
For most of this year, the focus has been on expanding the number and range of potential antiviral
compounds by designing, synthesising and testing additional novel analogues of the original BIT009
molecule. The aim has been to identify the best candidate to move forward into clinical trials. Biotron has
identified a lead series of compounds, and additional testing is currently underway to determine the best
candidate with the highest chances of successfully passing though the rigorous testing that is required by
regulatory authorities before the compound can be tested in man. Highly experienced consultants with
extensive expertise in lead optimisation and preclinical testing have been engaged to facilitate as rapid a
move as possible into clinical trials. A potential site for undertaking a Phase I/IIa clinical trial has been
identified and the Company is in discussions with appropriate regulatory authorities.
The Company’s proprietary screening assays have proved invaluable in rapidly screening new compounds
for anti-Vpu activity. Work is on-going at the prestigious Burnet Institute in Melbourne, investigating the
effect of the compounds on HIV-1 replication.
Since the end of the financial year, Biotron has significantly extended the Virion technology platform to
include a very broad range of viruses, including Hepatitis C virus, SARS coronavirus, and dengue virus.
Biotron’s proprietary compounds inhibit ion channel activity associated with these viruses, opening up
potential antiviral therapies for these currently untreatable viruses. Each is a medically significant virus,
affecting very large numbers of people around the world. Equally, if not more importantly, as a result of this
latest work Biotron has substantially broadened and strengthened its patent position over the Virion
technology. This means that the value of the technology has greatly increased, and will facilitate the
negotiation of potential partnerships.
During the year, on-going discussions have been held with potential partners regarding the Virion
technology. Whilst keen to secure a partner to take the compounds through into clinical development,
Biotron can vastly increase the value of the technology by undertaking the proposed early (Phase I/IIa)
clinical trial before forming an alliance. This will translate into much higher returns to the Company in the
form of upfront payments as well as increased milestone and royalty payments in the future.
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
C-Test
Cancer cells have a number of characteristics that distinguish them from normal cells. Most tumour markers
are neither sensitive nor specific enough to screen for or diagnose cancer without the support of other
clinical findings. While a number of different tumour markers have been identified, they have generally been
found to lack sensitivity and specificity for specific cancers. There is a real need for new tests that allow
unambiguous cancer diagnoses to be made at an early stage. The best tests will be simple and non-invasive
assays that allow rapid and accurate diagnosis of the type of cancer and its stage.
The C-Test Project is developing diagnostic tests for early detection and diagnosis of cancer. CT-1 is designed
to detect the presence of any type of cancer while CT-2 is designed to diagnose the type of cancer. As
previously noted in the Update to Shareholders in March 2003, the focus has been redirected to developing
a cheaper and faster method of purifying serum samples prior to analysis by mass spectrometry. During the
year, significant information regarding the chemical nature and structure of the biomarkers has been
obtained and this information is being used to simplify and refine the methods for extracting and analysing
patients’ samples. The Company’s researchers’ efforts to date have significantly enhanced the purity of the
biomarkers which facilitates their detection and analysis, resulting in significant improvements to the time
and cost of sample handling. This will translate into a more robust, competitive product and enhance the
commercial value of the C-test technology. A range of other technologies which may be able to be adapted
to further improve the C-Test technology are also being investigated.
CT-2 trials for diagnosis of prostate cancer and colorectal cancer are continuing. When the prostate cancer
trial was initiated in mid-2002, it was initially planned that the trial would be completed within six months.
The speed of recruitment of patients into the trial has been slower than initially anticipated which has caused
delays in completing the trial. The results to date have been encouraging. The CT-2 trial for colorectal cancer
diagnosis commenced earlier this year with clinicians from the Sydney Colorectal Associates at the Prince
of Wales and St George Hospitals, Sydney. Analysis of these samples has commenced in Biotron’s
laboratories, and will continue through to the second half of 2003. While trials are being planned for other
specific cancer types, they will not proceed until sufficient data from the current trials is available. The aim
is to develop specific, highly sensitive tests that distinguish each of the four major cancer types and enable
rapid, non-invasive diagnosis of each of these cancers and to move these tests into the marketplace as
rapidly as possible. To this end, discussions with potential partners who can facilitate this process have been
initiated.
Biotron has developed sophisticated methods for mathematical analysis of the data generated by the trial,
which significantly strengthens the Company’s competitive and intellectual property position. The work done
this year to improve sample processing and analysis, combined with the clinical samples from patients and
the mathematical models for analysing the data are likely to translate into a vastly improved and competitive
product.
TIER 2 PROJECTS
Tier 2 Projects are at an earlier stage of development than the C-Test and Virion Projects and, in accordance
with the Company’s focus on the commercial development of the Virion and C-test Projects, limited
resources are committed to the Tier 2 Projects at this stage. As the Tier 2 Projects develop and resources
become available through the commercialisation of the more advanced Tier 1 Projects, further resources will
be committed to those projects with maximal commercial potential.
Research has progressed throughout the year on the Tier 2 Projects as discussed below.
Muscion
Contraction of muscle, including heart muscle, depends on release of calcium from stores inside cells
through calcium channels called ryanodine receptors. The Muscion Project team is identifying compounds
that selectively target ryanodine receptors in heart, skeletal and insect muscle. As previously reported, the
researchers have discovered that some small peptides and toxins can modulate cardiac ryanodine receptors.
A number of these compounds have been found in vitro to stimulate heart muscle contraction leading to
increased cardiac output. Following identification of lead compounds from this research, Biotron will
develop drugs to boost the output of a damaged or failing heart muscle.
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
During the past year, work has been focused on the design, synthesis and testing of non-peptide mimetics
of the previously identified peptides that target the cardiac ryanodine receptors. A number of small molecule
compounds have been identified that have increased specificity for the cardiac ryanodine receptor
compared to skeletal ryanodine receptors. This has been an important step on the way to developing a lead
series of compounds that have potential utility in treatment of cardiac-related disorders.
Hypoxion
The Hypoxion research team is developing compounds that will reduce damage in cells deprived of their
blood supply (eg following heart attack or stroke). When blood supply is compromised, cells are starved of
oxygen. The consequent build-up of calcium in cells exposed to hypoxia kills them. The research team aims
to significantly reduce the patient death/disablement rate by stopping the build-up of calcium and saving
cells.
The project has two approaches, both aimed at preventing the flow of sodium ions through ‘persistent’
sodium channels that they have found are opened by hypoxia. The first approach is to screen for compounds
that can specifically block ‘persistent’ sodium channels. The second line of research that is in progress aims
to find a way to break the link between hypoxia and the opening of ‘persistent’ sodium channels.
GeneTrans
Biotron researchers have identified the mechanism by which a drug transport protein called MRP2 is directed
to membranes surrounding cells. Drug transport proteins have utility in drug screening tests that will help
predict the metabolism and safety of new pharmaceuticals. Screening tests are a vital part of the drug
development process. If toxicity is detected in the early pre-clinical stage of testing, further testing on
animals is avoided and the cost of drug development is significantly decreased. A library of toxicity results
from the screening process can be compiled for future use. High throughput screening tests of this type
provide a short-cut in product development and are in demand by the international pharmaceutical industry.
Biotron has generated a novel cell line expressing MRP2 and during the year has been optimising a drug
screening assay using this technology. Discussions are underway with potential licensees for this
technology.
Gabion
The Gabion Project team is researching the effects of known compounds that act on the GABAA receptor.
Research undertaken as part of the Gabion Project to determine the effects of GABA receptor associated
protein on expressed receptors is providing important new information about drug effects on these
receptors and has implications for the development of high throughput screens that will assist and
accelerate the drug discovery process.
PATENT APPLICATION DEVELOPMENTS
The C-Test Project patent entitled “Method of identifying cancer markers and uses therefor in the diagnosis
of cancer” has entered national phase in all jurisdictions, and is currently awaiting examination. A second
patent application relating to the nature of the biological marker for CT-1 (the detection of cancers), entitled
“A novel cancer marker and uses therefor in the diagnosis of cancer” has also entered national phase and
is currently awaiting examination. A new provisional application covering improvements to the subject
matter of this patent was filed earlier this year.
A USA patent was issued for the Virion patent application entitled “Method for determining ion channel
activity of a substance”. This patent is currently under examination in other countries. The second Virion
application entitled “Method of modulating ion channel functional activity” has entered national phase. It is
currently under examination in the USA and awaiting examination in other countries. Three additional
provisional applications have been filed to expand the scope of this original application to include a wider
range of compounds and viral targets.
The Muscion Project patent application entitled “Method of modulating the activity of calcium channels in
cardiac cells and reagents therefor” is at the PCT stage and is due to enter national phase later this year.
The GeneTrans patent application entitled “Modified proteins, isolated novel peptides and uses therefor”
has entered national phase and is currently awaiting examination.
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
CORPORATE GOVERNANCE STATEMENT
This statement outlines the main Corporate Governance practices that were in place throughout the financial
year, unless otherwise stated.
Board of Directors
The board of directors is responsible for the overall Corporate Governance of the Company including its
strategic direction, establishing goals for management and monitoring the achievement of these goals.
The composition of the board has been determined on the basis of providing the Company with the benefit
of a broad range of technical, administrative and financial skills, combined with an appropriate level of
experience at a senior corporate level.
The composition of the board is monitored constantly to ensure that it provides the Company with the
appropriate levels of both expertise and experience.
When a vacancy exists, through whatever cause, or where it is considered that the board would benefit from
the services of a new director with particular skills, the board identifies a panel of candidates with
appropriate expertise and experience. A selection procedure is then completed and the board appoints the
most suitable candidate who must stand for election at the next general meeting of shareholders.
Each director has the right to seek independent professional advice at the Company’s expense. Prior
approval of the Chairman is required, but such approval is not unreasonably withheld.
In the event that a potential conflict of interest may arise, involved directors must withdraw from all
deliberations concerning the matter.
The remuneration of the directors is determined by the board as a whole, with the director to whom a
particular decision relates being absent from the meeting during the time that the remuneration level is
discussed and decided upon.
Internal Controls
The board of directors acknowledges that it is responsible for the overall internal control framework, but
recognises that no cost effective internal control system will preclude all errors and irregularities. The system
of internal control adopted by the Company seeks to provide an appropriate division of responsibility and
careful selection and training of personnel relative to the level of activities and size of the Company.
The full board takes responsibility for reviewing financial reporting procedures, internal controls and the
performance of the financial management.
External Auditors
Board nominees review the performance of the external auditors and meet with them at the commencement
of the half yearly review and annual audit to discuss any issues that have arisen with respect to accounting
policies, any significant operational issues and level of proposed audit fees.
KPMG, the Company’s auditors, were appointed on 20 November 2001.
Audit Committee
As at the date of the Directors’ Report, there was no Audit Committee. An Audit Committee is not considered
to be warranted because of the involvement of the full board of directors in the activities of the Company.
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
Ethical Standards
All directors, managers and employees are expected to act with the utmost integrity and objectivity,
endeavouring at all times to enhance the performance and reputation of the Company. Every employee has
direct access to a director to whom they may refer any ethical issues that may arise from their employment.
The Role of Shareholders
The board ensures that the shareholders are informed of all major developments affecting the Company by
the following means:
• distribution of the annual report to all shareholders which contains relevant information about the
operations of the Company during the year in addition to disclosures required by the Corporations
Act 2001;
•
•
lodgement of the half yearly report with the Australian Stock Exchange, which contains summarised
and audit reviewed financial information. Copies of half yearly financial statements prepared in
accordance with the Corporations Act are available to any shareholder on request;
lodgement of quarterly reports with the Australian Stock Exchange which show summarised financial
information for the quarter. Copies of these reports are available to shareholders on request;
• announcements to the Australian Stock Exchange concerning any significant development in the
Company’s operations, financing and administration. All announcements are immediately available to
the general public; and
• disclosure of all major announcements to the Australian Stock Exchange on the Company’s website,
(www.biotron.com.au).
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
DIRECTORS’ REPORT
The directors present their report together with the financial report of Biotron Limited (‘the Company’) for
the year ended 30 June 2003 and the auditors’ report thereon.
Directors
The names of the directors of the Company holding office at any time during or since the end of the financial
year are:
Mr Michael J. Hoy
Chairman
Mr Hoy has more than 30 years’ corporate experience in Australia, the United Kingdom, USA and Asia. He
is Chairman of Cityprint Holdings Pty Ltd and Motoron.com Pty Ltd and a former director of John Fairfax
Holdings Limited and FXF Trust. He has been a Director since 7 February 2000 and Chairman since
16 March 2000.
Dr Michelle Miller, BSc, MSc, PhD
Managing Director
Dr Miller has over 20 years’ in the bioscience industry, with extensive experience in managing commercial
bioscience research. She completed her PhD in the Faculty of Medicine at Sydney University investigating
molecular models of cancer development. Her experience includes a number of years at Johnson and
Johnson developing anti-HIV gene therapeutics through preclinical research to clinical trials. She has
experience in early-stage start-ups from time spent as Investment Manager with a specialist bioscience
venture capital fund. She was appointed as Managing Director on 21 June 2002.
Professor Peter W. Gage, MB ChB, PhD, DSc FAA
Research Director
Professor Gage is a professor of Physiology at the John Curtin School of Medical Research at the Australian
National University and President of the Australian Physiological and Pharmacological Society.
He has more than 35 years’ experience in medical research, including training medical researchers,
particularly PhD students. For the past 25 years his research focus has been on ion channels.
Professor Gage was admitted as a fellow of the Australian Academy of Science in 1977 and was the recipient
of an Award of a Special Research Centre by the government in 1982 for research on nerve and muscle ion
channels.
He has been a Director since 23 February 1999.
Dr Michael S. Hirshorn, MBA, MB, BS
Non-Executive Director
Dr Hirshorn has over 20 years’ experience in the commercialisation of Australian Technology, particularly in
the medical device industry, and extensive experience in collaboration with Australian research institutes.
He played a major role in all commercial aspects of Cochlear Limited’s development, was a founding director
of Resmed Inc., and Chief Executive Marketing for Polartechnics Limited.
He has served on numerous government advisory committees, including the Start IT and T Committee, the
Start Grants Biological Sciences Committee of the Department of Industry, Science and Resources and is
currently an Investment Manager with a venture capital firm, Nanyang Ventures.
Dr Hirshorn was appointed as a Director on 16 March 2000.
Mr Bruce Hundertmark, BE, BEc
Non-Executive Director
Mr Hundertmark is an independent businessman and company director with a wide range of experience in
high technology based company start-up operations and promoting the formation of venture capital
companies, including News Datacom Limited in Israel and PT Indo Bio Products in Indonesia.
He has been a director of News International PLC, Prudential Cornhill Insurance Limited and was Managing
Director of IMFC Limited, a merchant bank.
Mr Hundertmark was appointed as a Director on 16 March 2000.
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
Mr Peter G. Scott
Non-Executive Director
Mr Scott is a founding director of Biotron Limited with more than 30 years’ of commercial and
entrepreneurial experience in Australia.
He is a director of Scott’s Acorn Pty Ltd and was formerly Chairman and Managing Director of Scottcom Pty
Ltd and Managing Director of ICAM Pty Ltd, audio visual and multimedia companies.
Mr Scott has been a Director since 23 February 1999.
Directors’ Meetings
The number of directors’ meetings and number of meetings attended by each of the directors of the
Company during the year are:
Director
Board Meetings
Held Attended
Michael J. Hoy
Michelle Miller
Peter W. Gage
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
6
6
6
6
6
6
6
6
6
6
6
6
Directors’ Interests
At the date of this report, the interests of each director of the Company in the issued share capital and
options of the Company are:
Fully Paid
Ordinary
Shares
1,000,000
-
9,400,000
-
-
8,550,000
18,950,000
30 September
2005 $0.50
Options
500,000
-
-
200,000
200,000
-
900,000
14 January
2007 $0.60
Options
-
250,000
-
-
-
-
14 January
2007 $0.75
Options
-
500,000
-
-
-
-
14 January
2007 $1.00
Options
-
500,000
-
-
-
-
250,000
500,000
500,000
Michael J. Hoy
Michelle Miller
Peter W. Gage
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Total
F I N A N C I A L R E P O R T 2 0 0 3
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L I M I T E D
Directors’ and Senior Executives’ Emoluments
The policy of remuneration of directors and senior executives is to ensure the remuneration package
properly reflects the person’s duties and responsibilities, and that remuneration is competitive in attracting,
retaining and motivating people of the highest quality. The Board is responsible for reviewing its own
performance. The non-executive directors are responsible for evaluating the performance of the executive
directors who, in turn, evaluate the performance of all other senior executives. The evaluation process is
intended to assess the Company’s business performance, whether long term strategic objectives are being
achieved and the achievement of individual performance objectives.
Remuneration generally comprises salary and superannuation. Longer term incentives are able to be
provided through the Company’s Incentive Option Plan which acts to align the directors and senior
executives’ actions with the interests of the shareholders. The emoluments disclosed below represent the
cost to the Company for the services provided under these arrangements.
Details of options granted to directors and senior executives as part of their remuneration and the nature
and amount of each major element of the emoluments of each director and senior executive of the
Company are:
Base
Emolument
$
125,039
30,000
60,000
30,000
30,000
30,000
Service
Charge
$
-
40,000
-
-
-
-
-
65,000
Directors
Executive
Michelle Miller
Peter W. Gage
Non-Executive
Michael J. Hoy
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Executive Officer
Peter J. Nightingale
Super
Contributions
$
11,244
2,700
5,400
2,700
2,700
2,700
-
Options
$
19,000
-
-
-
-
-
-
Total
$
155,283
72,700
65,400
32,700
32,700
32,700
65,000
Each option entitles the holder to purchase one ordinary share in the Company. During the financial year
ended 30 June 2002, a fair value of options, totalling $48,750, has been estimated at the date of granting,
using the Black-Scholes options pricing formula, of which $19,000 has been included in directors’
emoluments during the financial year ended 30 June 2003.
Options
At the date of this report, unissued ordinary shares of the Company under option are:
Number of Options
Exercise Price
Expiry Date
900,000
250,000
500,000
500,000
$0.50
$0.60
$0.75
$1.00
30 September 2005
14 January 2007
14 January 2007
14 January 2007
The options do not entitle the holder to participate in any share issue of the Company or any other body
corporate.
Principal Activities
The principal activities of the Company during the financial year were the funding and management of
intermediate and early applied biotechnology research and development projects.
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L I M I T E D
Financial Result and Review of Operations
The operating loss of the Company for the financial year after income tax was $2,728,701 (2002 - $1,667,894).
The operations of the Company for the year are set out in the Review of Operations.
Dividends
The directors recommend that no dividend be paid by the Company. No dividend has been paid or declared
since the end of the previous financial year.
State of Affairs
There were no significant changes in the state of affairs of the Company that occurred during the financial
year under review.
Environmental Regulation
The Company’s operations are not subject to significant environmental regulations under Commonwealth or
State legislation in relation to its research projects.
Events Subsequent to Balance Date
There has not arisen in the interval between the end of the financial year and the date of this report any item,
transaction or event of a material and unusual nature likely, in the opinion of the directors of the Company,
to affect significantly the operations of the Company, the results of those operations, or the state of affairs
of the Company, in future financial years.
Likely Developments
During the year ended 30 June 2003, the Company continued to fund and manage its research and
development projects. The success of these research projects, which cannot be assessed on the same
fundamentals as trading and manufacturing enterprises, will determine future likely developments.
In the opinion of the directors, it would prejudice the interests of the Company to provide additional
information, except as reported in this Annual Report, relating to likely developments in the operations of
the Company.
This report has been signed in accordance with a resolution of the directors and dated 29 September 2003:
Michael J. Hoy
Director
Michelle Miller
Director
F I N A N C I A L R E P O R T 2 0 0 3 1 1
2002
$
430,000
430,000
(490,576)
(226,343)
(448,328)
(998,229)
(74,620)
(14,076)
(220,058)
299,407
299,407
(474,832)
(211,582)
(371,306)
(1,197,012)
(81,605)
(60,636)
(256,799)
(2,354,365)
(2,042,230)
(374,336)
374,336
(2,728,701)
(1,667,894)
4.26 cents
4.26 cents
2.60 cents
2.60 cents
L I M I T E D
STATEMENT OF FINANCIAL PERFORMANCE
FOR THE YEAR ENDED 30 JUNE 2003
Note
2003
$
Other revenues from ordinary activities
Total revenue
Administration and consultants’ expenses
Depreciation
Employee and director expenses
Direct research and development expenses
Rent and outgoings expenses
Legal expenses
Other expenses from ordinary activities
Loss from ordinary activities before related income
tax expense
Income tax (expense)/benefit relating to ordinary activities
Net Loss
Basic loss per share
Diluted loss per share
2
3
3
5
4
4
F I N A N C I A L R E P O R T 2 0 0 3 1 2
L I M I T E D
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2003
CURRENT ASSETS
Cash assets
Receivables
Inventories
Other
Total Current Assets
NON-CURRENT ASSETS
Plant and equipment
Total Non-Current Assets
Total Assets
CURRENT LIABILITIES
Payable
Provisions
Total Current Liabilities
Total Liabilities
Net Assets
EQUITY
Contributed equity
Reserves
Accumulated losses
Total Equity
Note
6
7
8
9
10
11
12
13
14
2003
$
5,375,413
66,685
65,511
10,399
2002
$
7,577,479
412,739
90,455
29,752
5,518,008
8,110,425
391,080
391,080
5,909,088
132,844
15,232
148,076
148,076
5,761,012
522,183
522,183
8,632,608
137,494
5,401
142,895
142,895
8,489,713
11,444,960
11,444,960
110,850
110,850
(5,794,798)
(3,066,097)
5,761,012
8,489,713
F I N A N C I A L R E P O R T 2 0 0 3 1 3
L I M I T E D
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2003
Cash flows from operating activities
Cash receipts in the course of operations
Note
2003
$
-
2002
$
75,800
Cash payments in the course of operations
(1,223,982)
(1,127,222)
Interest received
Payments for research and development
Net cash used in operating activities
299,407
(1,197,012)
(2,121,587)
15
367,260
(998,229)
(1,682,391)
Cash flows from investing activities
Payments for plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Interest paid
Net cash provided by financing activities
Net decrease in cash held
Cash at the beginning of the financial year
(80,479)
(80,479)
(480,461)
(480,461)
-
-
-
28,200
(951)
27,249
(2,202,066)
(2,135,603)
7,577,479
9,713,082
Cash at the end of the financial year
15
5,375,413
7,577,479
F I N A N C I A L R E P O R T 2 0 0 3 1 4
L I M I T E D
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2003
1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
The significant policies which have been adopted in the preparation of this financial report are:
Basis of preparation
This financial report is a general purpose financial report which has been prepared in accordance with
Accounting Standards, Urgent Issues Group Consensus Views, other authoritative pronouncements of the
Australian Accounting Standards Board and the Corporations Act 2001.
It has been prepared on the basis of historical costs and, except where stated, does not take into account
changing money values or fair values of non-current assets.
These accounting policies have been consistently applied and, except where there is a change in accounting
policy, are consistent with those of the previous year.
Revenue recognition
Interest revenue
Interest revenue is recognised as it accrues.
Research and development grants
Research and development grants received in relation to research and development costs that have been
expensed are recognised as revenue.
Taxation
Income tax
The Company adopts the liability method of tax effect accounting. Income tax expense is calculated on
operating profit adjusted for permanent differences between taxable and accounting income. The tax effect
of timing differences, which arises from items being brought to account in different periods for income tax
and accounting purposes, is carried forward in the statement of financial position as a future income tax
benefit or a provision for deferred income tax.
Future income tax benefits are not brought to account unless realisation of the asset is assured beyond
reasonable doubt. Future income tax benefits relating to tax losses are only brought to account when their
realisation is virtually certain. The tax effect of capital losses is not recorded unless realisation is virtually
certain.
Goods and services tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except
where the amount of GST incurred is not recoverable from the Australian Tax Office (ATO). In these
circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of
the expense.
Receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from or payable to, the ATO is included as a current asset or liability in
the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows
arising from investing and financing activities which are recoverable from, or payable to, the ATO are
classified as operating cash flows.
Research and development costs
Research and development expenditure is expensed as incurred except to the extent that its recoverability
is assured beyond reasonable doubt, in which case it is deferred and amortised on a straight line basis over
the period in which the related benefits are expected to be realised.
F I N A N C I A L R E P O R T 2 0 0 3 1 5
L I M I T E D
Plant and equipment
Items of plant and equipment are initially recorded at cost and are depreciated over their estimated useful
lives using the reducing balance method from the date of acquisition at rates between 13% and 40% per
annum.
Accounts payable
Liabilities are recognised for amounts to be paid in the future for goods or services received, whether or not
billed to the Company. Trade accounts payable are normally settled within 60 days.
Incentive option plan
Where options are issued as remuneration for services rendered, the difference between the fair value of the
options issued and the consideration received, if any, is expensed and the fair value of the options is
recorded in the option premium reserve.
2. REVENUE FROM ORDINARY ACTIVITIES
Other revenues:
From operating activities
Interest - other parties
Research and development grants
Total revenue from ordinary activities
3. LOSS FROM ORDINARY ACTIVITIES BEFORE INCOME TAX EXPENSE
Loss from ordinary activities before income tax expense has been
arrived at after charging the following items:
Auditors’ remuneration paid to KPMG
- Audit and review of financial reports
Depreciation
- Office equipment
- Plant and equipment
Borrowing costs - interest paid to other parties
Direct research and development expenditure
expensed as incurred
Provision for employee entitlements
4. EARNINGS PER SHARE
Basic and diluted loss per share has been calculated using:
Net loss for the year
2003
$
2002
$
299,407
-
299,407
367,260
62,740
430,000
15,234
21,095
190,487
-
1,197,012
9,831
14,519
24,217
202,126
951
998,229
5,401
2,728,701
1,667,894
Weighted average number of ordinary shares
64,055,750
64,010,179
Options disclosed in the Contributed Equity note below are potential ordinary shares, but are not included
in the calculation of diluted loss per share as they are not dilutive.
F I N A N C I A L R E P O R T 2 0 0 3 1 6
L I M I T E D
5. INCOME TAX EXPENSE
Prima facie income tax benefit on operating loss
at 30% (2002 - 30%)
Tax effect of:
2003
$
2002
$
706,310
612,669
Tax losses not brought to account
(705,243)
(311,271)
Research and development expenditure rebated
Permanent differences
Income tax underprovided in prior year
-
(1,067)
-
(374,336)
75,000
(2,062)
374,336
-
Income tax benefit/(expense) attributable to profit
from ordinary activities
(374,336)
374,336
As at 30 June 2002, the directors intended to claim a research and development expenditure rebate which
would have resulted in a tax benefit of $374,336. During the year ended 30 June 2003, the directors
revised their assessment of this rebate and the tax benefit of $374,336 has been reversed.
The following potential income tax benefit calculated at 30% (2002 - 30%) arising from tax losses has not
been recognised as an asset because recovery is not virtually certain.
Tax losses
1,721,066
716,487
The Company has no franking credits.
The potential future income tax benefit will only be obtained if:
(a)
the Company derives future assessable income of a nature and of an amount sufficient to enable the
benefit to be realised;
(b)
the Company continues to comply with the conditions for deductibility imposed by law; and
(c)
no changes in tax legislation adversely affect the Company in realising the benefit.
6. RECEIVABLES
Current
Other debtors
7. INVENTORIES
Stores - at cost
8. OTHER CURRENT ASSETS
Prepayments
66,685
412,739
65,511
10,399
90,455
29,752
F I N A N C I A L R E P O R T 2 0 0 3 1 7
L I M I T E D
9. PLANT AND EQUIPMENT
Office equipment - at cost
Accumulated depreciation
Plant and equipment - at cost
Accumulated depreciation
Total plant and equipment - net book value
Reconciliations
Reconciliations of the carrying amounts for each
class of plant and equipment are set out below:
Office equipment
Carrying amount at beginning of year
Additions
Depreciation
Carrying amount at end of year
Plant and equipment
Carrying amount at beginning of year
Additions
Depreciation
Carrying amount at end of year
10. PAYABLES
Current
2003
$
87,658
(49,990)
37,668
746,464
(393,052)
353,412
391,080
49,612
9,151
(21,095)
37,668
472,571
71,328
(190,487)
353,412
2002
$
78,508
(28,896)
49,612
675,135
(202,564)
472,571
522,183
44,104
29,725
(24,217)
49,612
223,961
450,736
(202,126)
472,571
Other creditors and accruals
132,844
137,494
11. PROVISIONS
Current
Employee entitlement provisions
Number of employees at year end
12. CONTRIBUTED EQUITY
Issued and paid up capital
64,055,750 (2002 - 64,055,750) fully paid
ordinary shares
15,232
2
5,401
1
11,444,960
11,444,960
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled
to one vote per share at shareholders’ meetings. In the event of winding up of the Company, ordinary
shareholders rank after creditors and are fully entitled to any proceeds of liquidation.
F I N A N C I A L R E P O R T 2 0 0 3 1 8
L I M I T E D
Options
The following options were on issue at 30 June 2003, each exercisable to acquire one fully paid
ordinary share:
900,000 (2002 - 900,000) at $0.50 each at any time up to 30 September 2005.
250,000 (2002 - 250,000) at $0.60 each at any time up to 14 January 2007.
500,000 (2002 - 500,000) at $0.75 each at any time from 30 June 2003 to 14 January 2007.
500,000 (2002 - 500,000) at $1.00 each at any time from 30 June 2004 to 14 January 2007.
13. RESERVES
Option premium reserve
Balance at beginning of year
Issue of options at a premium
Transfer to accumulated losses on lapse of options
Balance at end of year
This reserve represents the fair value, at the date of issue,
of options on issue.
14. ACCUMULATED LOSSES
Accumulated losses at beginning of year
Net loss attributable to members of the Company
Transfer from option premium reserve
Accumulated losses at end of year
15. STATEMENT OF CASH FLOWS
Reconciliation of operating loss after tax to net cash used in operating activities
Operating loss after tax
Items classified as investing/financing activities
Interest paid
Non-cash items
Depreciation
Options granted as part of directors’ remuneration
Provisions
Changes in assets and liabilities
Prepayments
Receivables
Inventories
Payables
2003
$
110,850
-
-
110,850
2002
$
85,600
48,750
(23,500)
110,850
3,066,097
2,728,701
-
5,794,798
1,421,703
1,667,894
(23,500)
3,066,097
(2,728,701)
(1,667,894)
-
951
211,582
-
9,831
19,353
346,054
24,944
(4,650)
226,343
24,750
5,401
(5,752)
(302,121)
9,886
26,045
Net cash used in operating activities
(2,121,587)
(1,682,391)
F I N A N C I A L R E P O R T 2 0 0 3 1 9
L I M I T E D
Reconciliation of cash
For the purposes of the Statement of Cash Flows, cash includes cash
on hand and at bank and cash on deposit net of bank overdrafts and
excluding security deposits. Cash at the end of the financial year as
shown in the Statement of Cash Flows is reconciled to the related
items in the Statement of Financial Position as follows:
Cash
16. DIRECTORS’ REMUNERATION
The number of directors of the Company whose income from the
Company or any related party falls within the following bands:
$20,000 - $29,999
$30,000 - $39,999
$50,000 - $59,999
$60,000 - $69,999
$70,000 - $79,999
$150,000 - $159,999
$180,000 - $189,999
2003
$
2002
$
5,375,413
7,577,479
2003
Number
2002
Number
-
3
-
1
1
1
-
2003
$
1
3
1
-
1
-
1
2002
$
Total income paid or payable, or otherwise made available, to all
directors of the Company from the Company or any related party
391,483
439,589
17. EXECUTIVES’ REMUNERATION
The number of executive officers of the Company, whose
remuneration from the Company or related parties
falls within the following bands:
$150,000 - $159,999
$180,000 - $189,999
2003
Number
2002
Number
1
-
-
1
F I N A N C I A L R E P O R T 2 0 0 3
2 0
L I M I T E D
Total income received, or due and receivable, from the Company
or related parties by executive officers of the Company
whose income is $100,000 or more
2003
$
2002
$
155,283
187,639
The executive was also a director of the Company.
18. RELATED PARTY DISCLOURES
Directors
The name of each person holding the position of director of the Company during the financial year is
Michael J. Hoy, Michelle Miller, Peter W. Gage, Michael S. Hirshorn, Bruce Hundertmark, and Peter G. Scott.
Details of directors’ remuneration are set out above.
Details of relevant interests of directors of the Company and their director-related entities in shares and
options of the Company at year end are as follows:
Fully paid ordinary shares
30 September 2005 $0.50 options
14 January 2007 $0.60 options
30 June 2003 to 14 January 2007 $0.75 options
30 June 2004 to 14 January 2007 $1.00 options
2003
Number
2002
Number
18,950,000
19,050,000
900,000
250,000
500,000
500,000
900,000
250,000
500,000
500,000
During the year ended 30 June 2003, directors and director-related entities did not purchase any fully paid
ordinary shares or options and disposed of 100,000 fully paid ordinary shares for no consideration as a
charitable contribution.
During the year ended 30 June 2003, Michael J. Hoy had an interest in an entity, CityPrint Pty Limited, which
provided printing services to the Company. Payments to CityPrint Pty Limited, which were in the ordinary
course of business and on normal terms and conditions, amounted to $22,377 (2002 - $37,228).
F I N A N C I A L R E P O R T 2 0 0 3
2 1
L I M I T E D
19. EMPLOYEES AND INCENTIVE OPTION PLAN
At 30 June 2003, the Company had 2 employees (2002 - 1). All other personnel are contracted by the
Company on a consultancy basis.
The Company has an Incentive Option Plan to provide eligible persons, being employees or directors, or
individuals whom the Plan Committee determine to be employees for the purposes of the Plan, with the
opportunity to acquire options over unissued ordinary shares in the Company. The number of options
granted or offered under the Plan will not exceed 10% of the Company’s issued share capital and the exercise
price of options will be the greater of the market value of the Company’s shares as at the date of grant of the
option or such amount as the Plan Committee determines. Options have no voting or dividend rights. In the
event that the employment or office of the optionholder is terminated, any options which have not reached
their exercise period will lapse and any options which have reached their exercise period may be exercised
within three months of the date of termination of employment. Any options not exercised within this three
month period will lapse.
No options were granted pursuant to the Incentive Option Plan during the year ended 30 June 2003. No
ordinary shares have been issued as a result of the exercise of any options granted pursuant to the Incentive
Option Plan.
These options are not listed and accordingly have no market value at year end. The market value of the
ordinary shares under option at 30 June 2003 was $0.31 (2002 - $0.35) each.
The amount recognised in the financial statements in relation to the Incentive Option Plan during the
financial year was $19,000 (2002 - $48,750). Options issued pursuant to the plan are summarised below:
Grant
Date
24/01/03
06/02/02
28/06/03
28/06/03
Exercise
Date
24/01/03
06/02/02
30/06/03
30/06/04
Expiry
Date
30/09/05
14/01/07
14/01/07
14/01/07
Exercise
Date
30 June 2002
On Issue
$0.50
$0.60
$0.75
$1.00
900,000
250,000
500,000
500,000
Number of Options
30 June 2003
On Issue
900,000
250,000
500,000
500,000
Vested
900,000
250,000
500,000
-
2,150,000
2,150,000
1,650,000
F I N A N C I A L R E P O R T 2 0 0 3
2 2
L I M I T E D
20. FINANCIAL INSTRUMENTS DISCLOSURE
Interest rate risk
The Company’s exposure to interest rate risk and the effective weighted average interest rate for classes of
financial assets and financial liabilities is as follows:
Note
6
Weighted
average
interest
rate
%
Floating
interest
rate
$
4.62
5,375,413
-
-
Non-
interest
bearing
$
-
66,685
Total
$
5,375,413
66,685
148,076
148,076
10 and 11
-
Note
Weighted
average
interest
rate
%
Floating
interest
rate
$
Non-
interest
bearing
$
Total
$
4.55
7,577,479
6
10 and 11
-
-
-
-
-
412,739
7,577,479
412,739
142,895
142,895
Financial assets
Cash assets
Receivables
Financial liabilities
Payables and provisions
2002
Financial assets
Cash assets
Receivables
Financial liabilities
Payables and provisions
Credit risk exposure
The credit risk exposure on financial assets of the Company which have been recognised in the statement
of financial position is the carrying amount, net of any provision for doubtful debts.
Credit risk on cash assets is minimised by dealing with Australian regulated banks.
Net fair values of financial assets and liabilities
The carrying amounts of financial assets and liabilities approximate their net fair values.
21. FINANCIAL REPORTING BY SEGMENTS
The Company operates in the biotechnology industry in Australia.
F I N A N C I A L R E P O R T 2 0 0 3
2 3
L I M I T E D
DIRECTORS’ DECLARATION
In the opinion of the directors of Biotron Limited:
(a)
the financial statements and notes, set out on pages 12 to 23, are in accordance with the Corporations
Act 2001, including:
(i)
giving a true and fair view of the financial position of the Company as at 30 June 2003 and of its
performance, as represented by the results of its operations and its cash flows for the year ended
on that date; and
(ii)
complying with Accounting Standards in Australia and the Corporations Regulations 2001; and
(b)
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
This report has been signed in accordance with a resolution
of the directors and dated 29 September 2003:
Michael J. Hoy
Director
Michelle Miller
Director
F I N A N C I A L R E P O R T 2 0 0 3
2 4
L I M I T E D
INDEPENDENT AUDIT REPORT TO THE MEMBERS
OF BIOTRON LIMITED
Scope
We have audited the financial report of Biotron Limited for the financial year ended 30 June 2003, consisting
of the statement of financial performance, statement of financial position, statement of cash flows,
accompanying notes, and the directors’ declaration set out on pages 12 to 24. The Company’s directors are
responsible for the financial report. We have conducted an independent audit of this financial report in order
to express an opinion on it to the members of the Company.
Our audit has been conducted in accordance with Australian Auditing Standards to provide reasonable
assurance whether the financial report is free of material misstatement. Our procedures included
examination, on a test basis, of evidence supporting the amounts and other disclosures in the financial
report, and the evaluation of accounting policies and significant accounting estimates. These procedures
have been undertaken to form an opinion whether, in all material respects, the financial report is presented
fairly in accordance with Accounting Standards and other mandatory professional reporting requirements in
Australia and statutory requirements so as to present a view which is consistent with our understanding of
the Company’s financial position, and performance as represented by the results of its operations and its
cash flows.
The audit opinion expressed in this report has been formed on the above basis.
Audit Opinion
In our opinion, the financial report of Biotron Limited is in accordance with:
(a)
the Corporations Act 2001, including:
(i)
giving a true and fair view of the Company’s financial position as at 30 June 2003 and of its
performance for the year ended on that date; and
(ii)
complying with Accounting Standards in Australia and the Corporations Regulations 2001; and
(b) other mandatory professional reporting requirements in Australia.
KPMG
W.E. Austin
Partner
Brisbane
29 September 2003
F I N A N C I A L R E P O R T 2 0 0 3
2 5
L I M I T E D
ADDITIONAL ASX INFORMATION
Home Exchange
The Company is listed on the Australian Stock Exchange Limited. The home exchange is Sydney.
Use of Cash and Assets
Since the Company’s listing on the Australian Stock Exchange, the Company has used its cash and assets in
a way consistent with its stated business objectives.
Class of Shares and Voting Rights
There is only one class of shares in the Company, fully paid ordinary shares.
The rights attaching to shares in the Company are set out in the Company’s Constitution. The following is a
summary of the principal rights of the holders of shares in the Company.
Every holder of shares present in person or by proxy, attorney or representative at a meeting of shareholders
has one vote on a vote taken by a show of hands, and, on a poll every holder of shares who is present in
person or by proxy, attorney or representative has one vote for every fully paid share registered in the
shareholder’s name on the Company’s share register.
A poll may be demanded by the chairperson of the meeting, by at least 5 shareholders entitled to vote on
the resolution or shareholders with at least 5% of the votes that may be cast on the resolution on a poll.
Substantial Shareholders
As at the date of the Directors’ Report, the Register of Substantial Shareholders showed the following:
Peter Gage
Australian National University
Peter G. Scott
Gail S. Scott
9,400,000 fully paid ordinary shares
5,600,000 fully paid ordinary shares
4,250,000 fully paid ordinary shares
4,249,550 fully paid ordinary shares
Distribution of Equity Securityholders
As at 1 September 2003, the distribution of each class of equity was as follows:
Range
1- 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Fully Paid
Ordinary
Shares
30 September
2005 $0.50
Options
14 January
2007 $0.60
Options
14 January
2007 $0.75
Options
14 January
2007 $1.00
Options
71
812
469
412
38
1,802
-
-
-
-
3
3
-
-
-
-
1
1
-
-
-
-
1
1
-
-
-
-
1
1
At 1 September 2003, 105 shareholders held less than a marketable parcel of 1,316 shares.
F I N A N C I A L R E P O R T 2 0 0 3
2 6
L I M I T E D
Twenty Largest Quoted Shareholders and Optionholders
At 1 September 2003 the twenty largest fully paid ordinary shareholders held 65.4% of fully paid
ordinary as follows:
Name
1 Peter Gage
2 Australian National University
3 Peter Scott
4 Gail Scott
5 Angela Dulhunty
6 Philip and Marylyn Board
7 Chris and Bhama Parish
8 Carrington Services Pty Ltd
9 Altinova Nominees Pty Limited
10 Tom Mann
11 Commonwealth Custodial Services Ltd
12 Michael Hoy
13 Peter Nightingale
14 CBDF Pty Ltd
15 Gary Ewart
16 S. Family Pty Ltd
17 LPA No 2 Pty Ltd
18 Imnau Holdings Pty Ltd
19 Wightholme Nominees Pty Ltd
20 Lujeta Pty Limited
There are no current on-market buy-backs.
Fully Paid
Ordinary
Shares
9,400,000
5,600,000
4,250,000
4,249,550
2,500,000
2,199,950
2,100,000
2,000,000
1,895,305
1,780,000
1,000,000
1,000,000
1,000,000
550,000
500,000
475,000
410,844
352,178
350,000
329,610
%
14.7
8.7
6.6
6.6
3.9
3.4
3.3
3.1
3.0
2.8
1.6
1.6
1.6
0.9
0.8
0.7
0.6
0.5
0.5
0.5
F I N A N C I A L R E P O R T 2 0 0 3
2 7