Level 2, 66 Hunter Street, Sydney NSW 2000 Australia
Annual Report-2008
BIOTRON LIMITED ABN 60 086 399 144
Contents
Operating and Financial Review
Statement of Corporate Governance
Directors’ Report
Income Statement for the Year Ended 30 June 2008 1
Statement of Recognised Income and Expense for
the Year Ended 30 June 2008 1
Balance Sheet as at 30 June 2008 1
Statement of Cash Flows for the Year Ended 30 June 2008 1
Notes to the Financial Statements for
the Year Ended 30 June 2008 1
Directors’ Declaration
Independent Audit Report to the Members of
Biotron Limited 3
Additional Stock Exchange Information
Corporate Directory
2
5
7
4
5
6
7
8
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3
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36
Operating and Financial Review
The last 12 months have seen significant
advances on clinical progression of Biotron
Limited’s (‘Biotron’ or the ‘Company’)
antiviral drug development program, with
a major focus on developing new drugs
for treatment of HIV and Hepatitis C virus
(HCV). The Company has made excellent
progress during this time with its clinical
HCV and HIV programs – these are truly
world-class, with a new first-in class drug,
BIT225, in development for treatment of
both HIV and HCV infections. BIT225
offers the potential to significantly advance
treatments of both these debilitating
infections.
Significant events achieved during the past
year include:
•
Successful completion of Phase I clinical
trial of the Company’s lead antiviral
drug BIT225. This was the first trial of
BIT225 in humans.
• Receipt of a competitive Commercial
Ready Grant from the Australian
Federal Government for aspects of
development of BIT225.
• Demonstration that BIT225 is highly
synergistic with existing treatments for
HCV, which significantly strengthens
and advances the Company’s HCV
development program.
• Demonstration of activity of Biotron
compounds against Hepatitis B virus.
•
•
•
Presentation of Phase I data on BIT225
at an international HCV meeting in
Hawaii, USA in December 2007.
Presentation of other data from the
Company’s HIV and HCV programs
at several international scientific
conferences.
Presentation of Biotron programs at
international partnering conferences
including BIO2008 in San Diego and
the Fifth Anti-Infectives Partnering
& Deal Making Summit, held in
Philadelphia, USA.
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Biotron Limited Annual Report 2008
•
Initiation and successful completion of
an underwritten Share Purchase Plan,
raising $2.5 million for further clinical
development of BIT225.
Since the end of the financial year under
review, Biotron has progressed to the next
stage of clinical development of BIT225
with the initiation of a Phase Ib/IIa clinical
trial of BIT225 in HCV-infected patients at
two trial sites. Commencement of this trial
is a major milestone for the Company.
Clinical Development of BIT225
BIT225 is an investigational, orally-
administered, novel antiviral compound in
development by Biotron for treatment of
HIV and HCV infections. The successful
completion of the first human trial of
BIT225 during the second half of 2007 was
a major value adding milestone for Biotron.
This trial followed on from the completion
of a comprehensive program of preclinical
safety studies, and demonstrated the safety
of the drug in humans and its suitability
for progression into trials in patient
populations.
The data from this Phase I clinical trial
indicated BIT225 was well tolerated, with
no dose limiting toxicities. Analysis of the
data indicated that potentially therapeutic
blood levels of BIT225 were achieved,
based on calculations extrapolated from
preclinical in vitro antiviral efficacy studies.
The data from this Phase I trial is the first
human clinical analysis of BIT225, and are
important as they set the stage for further
studies of the drug in patient populations.
The Phase I trial demonstrated that the
absorption, distribution, half-life and
tolerability of BIT225 were acceptable, and
that safety and pharmacokinetic profiles
of BIT225 supported ongoing clinical
development.
The completed Phase I clinical trial in
healthy volunteers will support trials of
BIT225 in both HCV and HIV patient
populations, which significantly reduces
the costs and timelines of Biotron’s clinical
development programs.
The first half of 2008 has been spent in
extensive consultation with international
and national clinical advisors who have
specific expertise in the design of trials
of new drugs in patients. As BIT225 is a
new class of drug with a new mode of
action, it is critical that the next series of
trials are designed correctly to ensure that
the required outcomes can be achieved.
The data from these trials will be used to
support ongoing development of BIT225
and, critically, will be the major item
that maximises their value to a potential
commercial partner. Correctly designed
and implemented trials will benefit
shareholders as returns to the Company
from a commercial deal will be maximised.
The other key reason for ensuring the
trials are correctly designed is to maximise
patient recruitability. Defining inclusion
and exclusion criteria for trial participants
– such as stage of disease, past treatments,
current co-treatment, unrelated diseases,
age and gender – determine how quickly a
trial can recruit sufficient patients and be
completed. Rushing into poorly designed
trials may result in slow recruitment and
significantly prolonged outcomes.
Since the end of the financial year,
Biotron has commenced a Phase Ib/IIa
trial of BIT225 in HCV-infected patients,
after receipt of the necessary ethics and
regulatory approvals. The commencement
of this trial marks another major milestone
for the Company. The trial, code named
BIT225-003, will run over two sites during
the second half of 2008. The trial is a
placebo controlled, randomised study of
the safety, pharmacokinetics and antiviral
activity of BIT225 in patients with HCV
infection. The primary objective is to assess
the safety and tolerability of BIT225, given
twice daily, for 14 consecutive days. The
secondary objectives are to assess the
pharmacokinetics of BIT225 as well as to
assess the antiviral efficacy of BIT225 in
OpeRating and Financial Review
these patients. Eighteen patients will be
randomly assigned to receive one of two
dose levels of BIT225 or placebo. The
use of two trial sites, based in Sydney
and Brisbane, is aimed at maximising the
recruitment rate for the trial.
BIT225 represents a first-in-class drug
for treatment of HCV, targeting the p7
protein of HCV. It is estimated that in
the USA alone, some 4 million people
have been infected with HCV with 2.7
million suffering from chronic infection.
Worldwide, 170 million people are infected.
HCV causes inflammation of the liver,
which may lead to fibrosis and cirrhosis,
liver cancer and, ultimately, liver failure.
Existing drugs for HCV have limited
effectiveness and toxicity issues, leaving
a significant need for new therapies. The
worldwide market is currently almost
US$3.0 billion, but is estimated that this
market will expand to over US$10.0 billion
as safe, effective therapies enter the market.
During the past 12 months independent
research in the USA demonstrated that
BIT225 significantly enhances the activity
of existing HCV therapies in an in vitro
model system. The results of this research,
performed by Southern Research Institute
in Maryland, USA, are significant as they
indicate that BIT225 has the potential to be
used in combination therapy to achieve a
higher level of antiviral activity against HCV
than is currently possible, while improving
the potency of each of the drugs in the
combination. The results demonstrated
that BIT225 was highly synergistic in a
triple combination with two of the most
common HCV therapies in use today,
ribavirin and interferon- . The addition
of BIT225 to ribavirin and interferon-
increased the level of inhibition of viral
replication from 70% with the two other
drugs to 100% when BIT225 was added
to the mix. The potency of BIT225 was
increased tenfold in this triple combination,
compared to its activity on its own. The
studies were conducted in vitro against the
widely accepted surrogate model of the
HCV, bovine viral diarrhea virus (BVDV).
BVDV is closely related to HCV and is an
in vitro predictor of the efficacy of anti-
HCV drugs in humans. Previously, Biotron
reported that BIT225 is a potent inhibitor
of activity in this HCV surrogate model
system.
Biotron has filed a new patent to extend
the current protection over its lead antiviral
drug BIT225 and analogues. This latest
patent filing further strengthens Biotron’s
extensive intellectual property portfolio in
the antiviral drug development field.
BIT225 also represents a novel, first in class
approach to the treatment of HIV. BIT225
specifically targets HIV in reservoir cells
and represents an opportunity to attack
HIV at its source in the body. Current HIV
therapies have little or no effect on HIV in
the underlying reservoir of infected cells
where the virus hides from the immune
system. The market for HIV is very large,
with the USA market alone for HIV worth
over US$3.3 billion per annum. Biotron
is currently finalising protocols and other
documentation through the necessary
ethics and regulatory processes, with the
aim of progressing BIT225 into a Phase
Ib/IIa trial in HIV-positive patients.
These trials in HIV and HCV patients
are critical steps in the Company’s
development. Demonstration that BIT225
can attack these viruses in patients will be
a truly major advance in terms of Company
and technology valuations. The Company is
focused on achieving a successful outcome,
and has been holding discussions with
potential pharmaceutical companies in
anticipation of finalising a deal once these
trials have been completed. The proposed
trials are designed to benefit shareholders
through significantly increasing the value
of Biotron in the market and to its future
pharmaceutical company partners.
Biotron continues to leverage shareholder
funds by accessing non-equity funding
to support its development programs. In
the second half of 2007, the Company
received a grant of $465,000 from the
Federal Government’s Commercial Ready
Grant program. The grant is a partial
reimbursement of expenditures incurred
in the Phase I clinical development and
testing of BIT225. This latest grant is in
addition to the previous grants, including a
Biotechnology Innovation Fund Grant which
assisted with early stage development of
new drugs for various targeted viruses, and
a Start Grant which facilitated the selection
and preclinical testing of BIT225.
In December 2007 Biotron initiated and
subsequently completed a Share Purchase
Plan (SPP) to raise additional capital
for clinical development of its antiviral
programs. The issue of 14,700,000 shares
to raise $2.5 million was fully underwritten
and the funds raised by the SPP are being
used to support the Company’s ongoing
operational costs, including funding the
BIT225 Phase Ib/IIa clinical trials in infected
patients.
The Director’s would like to thank all those
shareholders who supported the Company
by participating in this capital raising.
Other Viral Programs
In addition to excellent progress with
the Company’s anti-HIV and anti-HCV
development programs, Biotron further
advanced its antiviral platform with the
finding that several of its proprietary
compounds have shown potent activity
against the Hepatitis B virus (HBV).
According to the World Health
Organisation, 350 to 400 million people
are chronically infected with HBV. Chronic
Hepatitis B (CHB) is a serious global health
problem, with infection progressing to liver
cirrhosis and hepatocellular carcinoma,
resulting in up to 1.2 million deaths
worldwide each year. Up to 80% of the
world’s primary liver cancer, which is
currently the fifth most frequent cancer
worldwide, is attributable to CHB.
Biotron Limited Annual Report 2008 I
3
OpeRating and Financial Review
This latest activity data against HBV
demonstrates the depth of Biotron’s
antiviral portfolio. The Company has
an impressive portfolio of clinical and
preclinical antiviral programs developing
drugs targeting HCV, HIV, Dengue virus
and Influenza virus. At present, focus is on
development of the HCV and HIV programs
into trials in infected patient populations,
and additional resources will be committed
to these additional programs once these
more advanced programs have been
successfully commercialised.
During the year, ongoing discussions were
held with potential partners regarding the
Virion technology. Whilst keen to secure a
partner to take the Company’s compounds
through into clinical development, Biotron
can significantly increase the value of the
technology by undertaking the proposed
Phase Ib/IIa clinical trials 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 level of interest by the international
community in Biotron’s antiviral programs
was reflected by the selection of Biotron
to participate in several prestigious
international scientific conferences
during the year. In July 2007 Biotron was
selected to give two presentations at the
International AIDS Society conference
in Sydney, NSW, and in December 2007
Biotron scientists were selected to present
data at an HCV conference and at an HIV
conference in Hawaii, USA. Presentation
at these meetings provided an excellent
opportunity to further discussions of the
Company’s technologies with potential
pharmaceutical partners. In addition
to these scientific meetings, Biotron
participated in international partnering
forums including the Fifth Anti-Infectives
Partnering & Deal Making Summit, held
in Philadelphia, USA and the annual
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Biotron Limited Annual Report 2008
biotechnology partnering conference
BIO2008 in San Diego, USA. These forums
provide an excellent opportunity to
showcase Biotron’s antiviral drug programs
to an international audience and to hold
meetings with business executives and
potential partners from USA and European
biotechnology and pharmaceutical
companies.
Patent Update
Biotron is focused on progressing patents
related to its antiviral programs through
the international patenting process.
The Company recognises that the key
to establishment of partnerships is the
expansion and continued strengthening of
Biotron’s intellectual property (IP) portfolio.
Strong, defensible, international patents are
essential to attract partners and to ensure
a competitive advantage for the Company’s
products in the marketplace. Biotron
continues to build a strong wall of patents
around its IP to maximise the value of the
technologies and to ensure its competitive
position.
As discussed above, during the past year
Biotron has filed an additional patent to
extend the current protection over its lead
antiviral drug BIT225 and analogues. This
latest patent filing further strengthens
Biotron’s extensive intellectual property
portfolio in the antiviral drug development
field. In addition, Biotron has progressed
existing patents through the international
PCT system into national jurisdictions.
A summary of Biotron’s patent portfolio is
set out below:
TITLE
WO0021538
Method of
modulating ion
channel functional
activity.
STATUS
Granted in
Australia, New
Zealand and China.
Under examination
elsewhere.
STATUS
Granted in
Australia and USA.
Under examination
elsewhere.
Entered into
national phase.
Entered into
national phase.
PCT filed in August
2008.
TITLE
WO9813514
Method of
determining ion
channel activity of
a substance.
WO04112687
Antiviral
compounds and
methods.
WO6135978
Antiviral
compounds and
methods.
Recent PCT filing
Hepatitis
C antiviral
compositions and
methods.
On behalf of the Board we would like
to thank the dedicated Biotron staff for
their commitment and efforts during the
year. Biotron is poised to achieve the
outcome that we have all been working
towards – demonstration that its antiviral
drug development program can produce
new, novel drugs which can attack virus
infections in humans, resulting in significant
clinical benefit to patients, and generating
major financial benefits to our shareholders.
We look forward to the next year with
confidence.
Michael J. Hoy
Chairman
Michelle Miller
Managing Director
Statement of corporate governance
This statement outlines the main Corporate
Governance practices that were in place
throughout the financial year, which
comply with the Australian Stock Exchange
(‘ASX’) Corporate Governance Council
recommendations, unless otherwise stated.
Board of Directors
The board of directors is responsible for
the overall corporate governance of the
Company including its strategic direction,
setting remuneration, establishing goals
for management and monitoring the
achievement of these goals and ensuring
the integrity of internal control and
management information systems. It
is also responsible for approving and
monitoring financial and other reporting.
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
names and further information regarding
the skills, experience, qualifications and
relevant expertise of the directors are set
out in the Directors’ Report. The board is
composed of a minimum of three directors.
The composition of the board is monitored
constantly to ensure that it provides the
Company with the appropriate levels of
both expertise and experience. The board
comprises a majority of independent,
non-executive directors including the
Chairperson. The independence of directors
is based on their capacity to put the
best interests of the Company and its
shareholders ahead of all other interests.
When a board 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.
Directors, other than the Managing
Director, are subject to re-election by the
shareholders at least every three years.
Having regard to the current membership
of the board and the size, organisational
complexity and scope of operations of
the entity, a Nomination Committee, a
Remuneration Committee and an Audit
Committee have not been established.
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. A copy of the
advice received by the director is made
available to all other members of the board.
In the event that a potential conflict of
interest may arise, involved directors must
withdraw from all deliberations concerning
the matter.
Remuneration
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.
For details on the amount of remuneration
and any amount of equity based executive
remuneration payment for each director,
refer to the Key Management Personnel
note to the financial statements and the
Remuneration Report in the Directors’
Report.
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. Selected
internal control mechanisms employed to
support the business include:
•
Investment appraisal – the Company
has documented guidelines for capital
expenditure and investment appraisals.
These include annual budgets,
expenditure review procedures and
appropriate levels of authority.
• Business planning, budgeting and
reporting – a comprehensive business
planning process includes evaluation of
strategies, objectives, and risks resulting
in an annual budget approved by the
board. Monthly actual performance is
reported against budget and revised
forecasts for the year are prepared
regularly.
• Quality and integrity of employees
– there are clearly defined
accountabilities, performance measures,
and reinforcement of values and ethics
by management.
The CEO and CFO state in writing to
the board that the Company’s financial
statements present a true and fair view,
in all material respects, of the Company’s
financial condition and operational results
and are in accordance with relevant
accounting standards.
Biotron Limited Annual Report 2008 I
5
Statement OF cORpORate GOVERnAnCE
External Auditors
Board nominees review the performance
of the external auditors and meet with
them during the half yearly review and
annual audit to discuss any issues that
have arisen with respect to accounting
policies, any significant operational issues
and the level of proposed audit fees. The
auditor is requested to attend the Annual
General Meeting and be available to answer
shareholder questions about the conduct of
the audit and the preparation and content
of the auditor’s report.
KPMG, the Company’s auditors, were
appointed on 20 November 2001.
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.
Directors, officers and employees are
permitted to trade in the Company’s
securities only in accordance with the
provisions of the Corporations Act and ASX
Listing Rules. The directors are under an
obligation to report any dealings by them
in the Company’s securities.
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.
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Biotron Limited Annual Report 2008
•
•
•
Lodgement of quarterly reports with
the ASX which show summarised
financial information for the quarter.
Copies of these reports are available to
shareholders on request.
Lodgement of the half yearly
report with the ASX 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 the annual report with
the ASX which contains full audited
financial information prepared in
accordance with the Corporations Act.
The annual report is distributed to all
shareholders (unless a shareholder has
specifically requested not to receive the
document).
• Announcements to the ASX concerning
any significant development in the
Company’s operations, financing and
administration. All announcements are
immediately available to the general
public.
• Disclosure of all major announcements
to the ASX on the Company’s website.
•
The Annual General Meeting is the
main opportunity for the shareholders
to hear the Managing Director and
Chairman provide updates on the
Company’s performance, ask questions
of the board and to express views and
vote on various matters of business on
the agenda.
The shareholders are responsible for voting
on the appointment of directors.
Risk Management
Due to the size of the Company, the
number of officers and employees and
the nature of the Company’s business, a
formal risk management policy and internal
compliance and control system has not
been implemented. The chief executive
officer and chief financial officer declare,
in writing, to the board that that the
system of risk management and internal
compliance and control which implements
the policies adopted by the board has
been assessed and found to be operating
efficiently and effectively in all material
respects.
Each director reviews the business
risks affecting his particular area of
expertise annually and reports to the
board. The board then determines the
appropriate actions to eliminate or
minimise the identified business risks. The
full board oversees the establishment,
implementation and ongoing review of the
Company’s risk management and internal
control system. The internal control
system covers financial, operational and
compliance risks.
Recommendations made by external
auditors and other external advisers are
investigated by the board and, where
necessary, appropriate action is taken to
ensure that the Company has the internal
control environment to manage the key
risks identified. Ways of enhancing existing
risk management strategies, including
segregation of duties, employment
and training of suitably qualified and
experienced personnel are investigated by
the board.
Performance Evaluation of the Board
and Key Executives
Due to the size of the Company, the
number of officers and employees and
the nature of the Company’s business,
the board has adopted an informal and
continuous performance evaluation process
of the directors and key executives. The
Company has not established formal
performance review measures for the board
or key executives nor has it established a
nomination committee.
Directors’ Report
The directors present their report together
with the financial report of Biotron Limited
(‘the Company’) for the year ended 30 June
2008 and the auditor’s report thereon.
Directors
The names and particulars of the directors
of the Company at any time during or since
the end of the financial year are:
Mr Michael J. Hoy
Independent and Non-Executive
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 Limited, Chairman of
Tellesso Technologies Limited 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,
GCertAppFin (Finsia)
Managing Director
Dr Miller has worked for 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.
Dr Michael S. Hirshorn, MBA, MB, BS
Independent and Non-Executive
Director
Dr Hirshorn has a 30 years career of
founding, building, managing and investing
in technology companies. 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 over eight years of private equity
experience, raising a fund and investing
and developing companies. 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. He is
currently a director of Dynamic Hearing
and TGR BioSciences.
Dr Hirshorn was appointed as a director on
16 March 2000.
Mr Bruce Hundertmark
Independent and Non-Executive
Director
Mr Hundertmark is an independent
businessman and company director with a
wide range of experience in diverse business
operations. He has specialised in recent
years in high technology based company
start-up operations and in promoting the
formation of venture capital companies
including News Datacom Research Limited
in Israel, News Datacom Limited in Hong
Kong and both PT Indo Bio Products and PT
Indo Bio Fuels in Indonesia.
He has been a director of numerous private
and publicly listed companies including
News International PLC, Sky Television PLC,
Prudential Cornhill Insurance Limited, Harris
Scarfe Limited, Bernkastel Wines Limited,
Codan Limited, Samic Limited
and Investment & Merchant Finance
Corporation Limited.
Mr Hundertmark was appointed as a
director on 16 March 2000.
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.
Peter J. Nightingale
Company Secretary
Mr Nightingale graduated with a Bachelor
of Economics degree from the University of
Sydney and is a member of the Institute of
Chartered Accountants in Australia. He has
worked as a chartered accountant in both
Australia and the USA.
As a director or company secretary Mr
Nightingale has, for the past 21 years,
been responsible for the financial control,
administration, secretarial and in-house
legal functions of a number of private
and public listed companies in Australia,
the USA and Europe including Pangea
Resources Limited, Timberline Minerals Inc.,
Perseverance Corporation Limited, Valdora
Minerals N.L., ETT Limited, Bolnisi Gold NL
and Palmarejo Silver and Gold Corporation.
Mr Nightingale is currently a director of
Cockatoo Coal Limited and Planet Gas
Limited.
Mr Nightingale has been Company
Secretary since 23 February 1999.
Biotron Limited Annual Report 2008 I
7
diRectORS’ RepORt
Directors’ Meetings
The number of directors’ meetings held and number of meetings attended by each of the directors of the Company, while they were a
director, during the year are:
no. of Meetings Held
no. of Meetings Attended
Michael J. Hoy
Michelle Miller
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Directors’ Interests
7
7
7
7
7
7
7
6
7
7
At the date of this report, the beneficial interests of each director of the Company in the issued share capital of the Company and options,
each exercisable to acquire one fully paid ordinary share of the Company are:
Fully Paid Ordinary Shares
Options
1,345,714
-
-
-
-
-
8,924,414
500,000
500,000
500,000
500,000
200,000
200,000
-
Option Terms
(Exercise Price and Term)
$0.35 at any time up to 30 September 2010
$0.35 at any time up to 30 September 2010
$0.40 at any time from 30 September 2006 up to
30 September 2006 up to 30 September 2010
$0.45 at any time from 30 September 2007 up to
30 September 2010
$0.35 at any time up to 30 September 2010
$0.35 at any time up to 30 September 2010
-
Michael J. Hoy
Michelle Miller
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Option Holdings
The movement during the reporting period in the number of options over ordinary shares in the Company held directly, indirectly or
beneficially, by each specified director, including their personally-related entities, is as follows:
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Biotron Limited Annual Report 2008
diRectORS’ RepORt
Option holdings - 2008
Held at
1 July 2007
Granted as
remuneration
Expired
Held at
30 June 2008
Vested and
exercisable at
30 June 2008
Directors
Michael J. Hoy
Michelle Miller
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Executives
500,000
1,500.000
200,000
200,000
-
Peter J. Nightingale
200,000
Option holdings - 2007
Held at
1 July 2006
Granted as
remuneration
Directors
Michael J. Hoy
Michelle Miller
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Executives
500,000
2,750.000
200,000
200,000
-
Peter J. Nightingale
200,000
Remuneration Report - Audited
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Expired
1,250.000
-
-
-
-
500,000
1,500.000
200,000
200,000
-
500,000
1,500.000
200,000
200,000
-
200,000
200,000
Held at
30 June 2007
Vested and
exercisable at
30 June 2007
500,000
1,500.000
200,000
200,000
-
500,000
1,500.000
200,000
200,000
-
200,000
200,000
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
remuneration disclosed below represents the cost to the Company for the services provided under these arrangements.
No directors or senior executives receive performance related remuneration. No bonuses were paid during the year.
Biotron Limited Annual Report 2008 I
9
diRectORS’ RepORt
Details of director and senior executive remuneration and the nature and amount of each major element of the remuneration of each
director and senior executive of the Company are:
Year
Primary Salary
and Fees
Post-
Employment
Superannuation
Benefits
Equity
Compensation
Value of
Options
$
$
Directors
Non-executive
Michael J. Hoy
(Chairman)
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Executive
Michelle Miller
(Managing Director)
Total, all specified
directors
Executives
Peter J. Nightingale
(Company Secretary)
Total, all specified
directors and
executives
2008
2007
2008
2007
2008
2007
2008
2007
2008
2007
2008
2007
2008
2007
2008
2007
60,000
60,000
30,000
30,000
30,000
30,000
5,000
5,000
200,000
200,000
325,000
325,000
75,000
60,848
400,000
385,848
5,400
5,400
2,700
2,700
2,700
2,700
27,700
27,700
18,000
33,385
56,500
71,885
-
-
56,500
71,885
$
-
-
-
-
-
-
-
-
2,403
15,068
2,403
15,068
-
-
2,403
15,068
Total
$
65,400
65,400
32,700
32,700
32,700
32,700
32,700
32,700
220,403
248,453
383,903
411,953
75,000
60,848
458,903
472,801
Options
as a % of
Remuneration
-
-
-
-
-
-
-
-
1%
6%
1%
4%
-
-
1%
3%
10
I
Biotron Limited Annual Report 2008
diRectORS’ REPORT
Options granted as compensation - Audited
Details of options that were granted as compensation to each key management person:
Director
Grant Date
number of
options granted
Fair value at
grant date
Michelle Miller
14 October 2005
500,000
$24,016
Michelle Miller
14 October 2005
500,000
$21,114
Michelle Miller
14 October 2005
500,000
$18,701
Option Terms
(Exercise Price and Term)
$0.35 at any time up to
30 September 2010
$0.40 at any time from 30 September 2006
up to 30 September 2010
$0.45 at any time from 30 September 2007
up to 30 September 2010
The number of options that had vested as at 30 June 2008 is 1,500,000 (2007 – 1,000,000). There were 500,000 options (2007 – 500,000)
that vested during the year ended 30 June 2008.
The fair value of the options at grant date was determined based on the Black-Scholes formula. The model inputs of the options issued, were
the Company’s share price of $0.17 at the grant date, a volatility factor of 50% based on historic share price performance and a risk free
interest rate of 5.25% based on the 10 year government bond rate.
Consequences of Performance on Shareholder Wealth - Audited
In considering the Company’s performance and benefits for shareholders wealth, the board have regard to the following indices in respect of
the current financial year and the previous four financial years.
Net loss attributable to equity
holders of the Company
2008
2007
2006
2005
2004
$1,882,093
$3,234,004
$2,198,973
$1,883,575
$2,805,115
Dividends paid
-
-
-
-
-
Change in share price
(9.00) cents
4.50 cents
7.02 cents
(5.77) cents
(11.52) cents
The overall level of key management personnel’s compensation has been determined based on market conditions and advancement of the
Company’s projects.
Service Contracts - Audited
There are no service contracts for the key management personnel.
Non-executive Directors - Audited
Total compensation for all non-executive directors is determined by the board based on market conditions.
Options
At the date of this report, unissued ordinary shares of the Company under option are:
number of Options
Exercise Price
5,450,000
750,000
500,000
$0.35
$0.40
$0.45
Expiry Date
30 September 2010
30 September 2010
30 September 2010
The options do not entitle the holder to participate in any share issue of the Company or any other body corporate.
Biotron Limited Annual Report 2008 I
11
diRectORS’ RepORt
Principal Activities
Events Subsequent to Balance Date
non-audit Services
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 2008, 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.
Indemnification of Officers and
Auditors
During or since the end of the financial
year, the Company has not indemnified or
made a relevant agreement to indemnify an
officer or auditor of the Company against
a liability incurred by such an officer or
auditor. In addition, the Company has not
paid or agreed to pay, a premium in respect
of a contract insuring against a liability
incurred by an officer or auditor.
During the year KPMG, the Company’s
auditor, has performed certain other
services in addition to their statutory
duties.
The board has considered the non-audit
services provided during the year by the
auditor and is satisfied that the provision
of those non-audit services during the year
by the auditor is compatible with, and did
not compromise, the auditor independence
requirements of the Corporations Act 2001
for the following reasons:
•
•
all non-audit services were subject to
the corporate governance procedures
adopted by the Company and have
been reviewed by the board to ensure
they do not impact the integrity and
objectivity of the auditor; and
the non-audit services provided do
not undermine the general principles
relating to auditor independence as
set out in APES 110 Code of Ethics
for Professional Accountants, as they
did not involve reviewing or auditing
the auditor’s own work, acting in
a management or decision making
capacity for the Company, acting as an
advocate for the Company or jointly
sharing risks and rewards.
A copy of the auditors’ independence
declaration as required under Section 307C
of the Corporations Act 2001 is included in
the Directors’ Report.
The principal activities of the Company
during the financial year were the funding
and management of intermediate and
applied biotechnology research and
development projects.
Financial Result and Review of
Operations
The operating loss of the Company for
the financial year after income tax was
$1,882,093 (2007 - $3,234,004).
A review of the Company’s operations for
the year is set out in the Operating and
Financial Review.
Impact of Legislation and Other
External Requirements
There were no changes in environmental or
other legislative requirements during the
year that have significantly impacted the
results or operations of the Company.
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
In the opinion of the directors, 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.
12
I
Biotron Limited Annual Report 2008
diRectORS’ RepORt
Details of the amounts paid to the auditor of the Company, KPMG, and its related practices for audit and non-audit services provided during
the year are set out below.
Statutory audit
- Audit and review of financial reports (KPMG Australia)
Services other than statutory audit
- Grant audit (KPMG Australia)
Lead Auditor’s Independence Declaration
2008
$
18,043
2007
$
25,783
5,000
1,000
The Lead Auditor’s Independence Declaration is set out below and forms part of the Directors’ Report for the year ended 30 June 2008.
This report has been signed in accordance with a resolution of the directors and is dated 29 August 2008:
Michael J. Hoy
Chairman
Michelle Miller
Managing Director
Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001
To the Directors of Biotron Limited:
I declare that, to the best of my knowledge and belief, in relation to the audit for the financial year ended 30 June 2008, there have been:
(i) no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit, and
(ii) no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
29 August 2008
S.J. Board
Partner
Biotron Limited Annual Report 2008 I
13
income Statement FOR tHe YeaR ended 30 JUne 2008
Other income
Administration and consultants’ expenses
Depreciation
Employee and director expenses
Direct research and development expenses
Rent and outgoings expenses
Legal expenses
Refund of grant
Other expenses from ordinary activities
Operating loss before financing income
Interest income
net financing income
Loss before tax
Income tax expense
Loss for the year
Basic loss per share attributable to ordinary equity shareholders
Diluted loss per share attributable to ordinary equity shareholders
notes
2008
$
2007
$
2
3
3
5
4
4
431,409
402,457
(289,473)
(40,444)
(476,405)
(373,287)
(51,492)
(455,440)
(1,303,421)
(2,412,418)
(25,818)
(8,978)
-
(244,096)
(44,320)
(73,939)
(127,177)
(254,351)
(1,957,226)
(3,389,967)
75,133
75,133
155,963
155,963
(1,882,093)
(3,234,004)
-
-
(1,882,093)
(3,234,004)
(2.00) cents
(2.00) cents
(3.60) cents
(3.60) cents
14
I
Biotron Limited Annual Report 2008
Statement of Recognised income and expense
FOR tHe YeaR ended 30 JUne 2008
Loss for the year
Total recognised income and expense for the year
Other movements in equity arising from transactions with owners as owners are set out in note 11.
2008
$
2007
$
(1,882,093)
(1,882,093)
(3,234,004)
(3,234,004)
Biotron Limited Annual Report 2008 I
15
Balance Sheet aS at 30 JUne 2008
Current assets
Cash and cash equivalents
Trade and other receivables
Other
Total current assets
non-current assets
Plant and equipment
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Employee entitlements
Total current liabilities
Total liabilities
net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
16
I
Biotron Limited Annual Report 2008
notes
2008
$
2007
$
6
7
8
9
10
11
12
13
2,063,596
1,378,722
59,483
29,160
41,051
6,000
2,152,239
1,425,773
115,083
115,083
93,265
93,265
2,267,322
1,519,038
317,627
106,318
423,945
423,945
117,618
45,405
163,023
163,023
1,843,377
1,356,015
19,146,365
16,865,134
359,608
296,497
(17,662,596)
(15,805,616)
1,843,377
1,356,015
Statement of cash Flows FOR tHe YeaR ended 30 JUne 2008
Cash flows from operating activities
Cash receipts in the course of operations
Payments for research and development
Cash payments in the course of operations
Cash generated from operations
notes
2008
$
470,893
(1,219,196)
(937,163)
(1,685,466)
2007
$
-
(2,629,535)
(1,167,288)
(3,796,823)
Interest received
63,147
151,694
net cash from operating activities
14
(1,622,319)
(3,645,129)
Cash flows from investing activities
Proceeds on sale of intellectual property
Payments for plant and equipment
net cash from investing activities
Cash flows from financing activities
Proceeds from issue of shares
Cost of issue of shares
net cash from financing activities
net increase/(decrease) in cash and cash equivalents held
Cash and cash equivalents at the beginning of the financial year
Cash and cash equivalents at the end of the financial year
14
-
(62,261)
(62,261)
2,499,000
(129,546)
2,369,454
684,874
1,378,722
2,063,596
402,457
(2,192)
400,265
-
-
-
(3,244,864)
4,623,586
1,378,722
Biotron Limited Annual Report 2008 I
17
notes to the Financial Statements FOR tHe YeaR ended 30 JUne 2008
1. REPORTInG EnTITY
Biotron Limited (the ‘Company’) is a
company domiciled in Australia.
Basis of preparation
Statement of compliance
The financial report is a general purpose
financial report which has been prepared
in accordance with Australian Accounting
Standards (‘AASBs’) adopted by the
Australian Accounting Standards Board
(‘AASB’) and the Corporations Act 2001.
The financial report of the Company also
complies with the IFRSs and interpretations
adopted by the International Accounting
Standards Board.
The financial report was authorised for
issue by the directors on 29 August 2008.
Basis of measurement
The financial statements have been
prepared on the historical cost basis.
Functional and presentation currency
These financial statements are presented in
Australian dollars, which is the Company’s
functional currency.
Use of estimates and judgements
The preparation of financial statements
requires management to make judgements,
estimates and assumptions that affect
the application of accounting policies and
the reported amounts of assets, liabilities,
income and expenses. Actual results may
differ from these estimates.
Estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the
period in which the estimate is revised and
in any future periods affected.
In particular, information about significant
areas of estimation uncertainty and critical
judgements in applying accounting policies
that have the most significant effect on
18
I
Biotron Limited Annual Report 2008
the amount recognised in the financial
statements are described in the following
note 1, Going concern:
Going concern
The financial report has been prepared on
a going concern basis which contemplates
the realisation of assets and settlement of
liabilities in the ordinary course of business.
The ongoing operation of the Company is
dependent on:
•
•
The Company raising additional fund
from shareholders; and/or
The Company reducing expenditure in
line with available funding.
The directors have prepared cash flow
projections that support the ability of the
Company to continue as a going concern.
These cash flow projections assume the
Company obtaining additional funding
from shareholders. If such funding is
not achieved, the Company can reduce
expenditures significantly.
In the event that the Company does not
obtain additional funding and /or reduce
expenditure in line with available funding,
it may be unable to continue its operations
as a going concern and therefore may not
be able to realises its assets and extinguish
its liabilities in the ordinary courses of
operations and at the amounts stated in
the financial statements.
Significant accounting policies
The accounting policies set out below have
been applied consistently to all periods
presented in the Company financial report
and have been applied consistently.
New standards and interpretations
not yet adopted
The following standards, amendments to
standards and interpretations have been
identified as those which may impact the
entity in the period of initial application.
They are available for early adoption at 30
June 2008, but have not been applied in
preparing this financial report:
• Revised AASB 3 Business Combinations
changes the application of acquisition
accounting for business combinations
and the accounting for non-controlling
(minority) interests. Key changes
include: the immediate expensing of
all transaction costs; measurement of
contingent consideration at acquisition
date with subsequent changes through
the income statement; measurement
of non-controlling (minority) interests
at full fair value or the proportionate
share of the fair value of the underlying
net assets; guidance on issues such
as reacquired rights and vendor
indemnities; and the inclusion of
combinations by contract alone and
those involving mutuals. The revised
standard becomes mandatory for the
Company’s 30 June 2010 financial
statements. The Company has not yet
determined the potential effect of the
revised standard on the Company’s
financial report.
• AASB 8 Operating Segments introduces
the “management approach” to
segment reporting. AASB 8, which
becomes mandatory for the Company’s
30 June 2010 financial statements,
will require the disclosure of segment
information based on the internal
reports regularly reviewed by the
Company’s Chief Operating Decision
Maker in order to assess each segment’s
performance and to allocate resources
to them. The Company has not yet
determined the potential effect of the
revised standard on the Company’s
disclosures.
• Revised AASB 101 Presentation of
Financial Statements introduces
as a financial statement (formerly
“primary” statement) the “statement
of comprehensive income”. The
revised standard does not change the
recognition, measurement or disclosure
of transactions and events that are
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
required by other AASBs. The revised
AASB 101 will become mandatory for
the Company’s 30 June 2010 financial
statements. The Company has not yet
determined the potential effect of the
revised standard on the Company’s
disclosures.
• Revised AASB 123 Borrowing Costs
removes the option to expense
borrowing costs and requires that
an entity capitalise borrowing costs
directly attributable to the acquisition,
construction or production of a
qualifying asset as part of the cost of
that asset. The revised AASB 123 will
become mandatory for the Company’s
30 June 2010 financial statements and
will constitute a change in accounting
policy for the Company. In accordance
with the transitional provisions the
Company will apply the revised AASB
123 to qualifying assets for which
capitalisation of borrowing costs
commences on or after the effective
date. The Company has not yet
determined the potential effect of the
revised standard on future earnings.
• AASB 2008-1 Amendments to
Australian Accounting Standard - Share-
based Payment: Vesting Conditions
and Cancellations changes the
measurement of share-based payments
that contain non-vesting conditions.
AASB 2008-1 becomes mandatory for
the Company’s 30 June 2010 financial
statements. The Company has not yet
determined the potential effect of the
amending standard on the Company’s
financial report.
Cash and cash equivalents
Cash and cash equivalents comprise cash
balances and call deposits.
Trade and other receivables
Trade and other receivables are stated at
their amortised cost less impairment losses.
Property, plant and equipment
Property plant and equipment are stated
at their historical cost less accumulated
depreciation and impairment loss.
Depreciation is recognised in profit or loss
using the reducing balance method from
the date of acquisition at rates between
13% and 40% per annum.
Research and development
Grants
Where a grant is received relating to
research and development costs that have
been expensed, the grant is recognised as
revenue when there is reasonable assurance
it will be received.
Costs
Expenditure on research activities,
undertaken with the prospect of gaining
new scientific or technical knowledge and
understanding, is recognised in profit and
loss when incurred.
Development activities involve a plan
or design for the production of new or
substantially improved products and
processes. Development expenditure is
capitalised only if development costs can
be measured reliably, the product or process
is technically and commercially feasible,
future economic benefits are probable, and
the Company intends to and has sufficient
resources to complete development and
to use or sell the asset. The expenditure
capitalised includes the cost of materials,
direct labour and overhead costs that are
directly attributable to preparing the asset
for its intended use. Other development
expenditure is recognised in profit or loss
when incurred.
Capitalised development expenditure
is measured at cost less accumulated
amortisation and accumulated impairment
losses.
Trade and other payables
Trade and other payables are stated at their
amortised cost, are non-interest bearing
and are normally settled within 60 days.
Employee entitlements
Wages, salaries, annual leave and sick leave
Liabilities for employee entitlements for
wages, salaries, annual leave, long service
leave and sick leave represent present
obligations resulting from employees’
services provided to reporting date,
calculated at undiscounted amounts based
on remuneration wages and salary rates
that the company expect to pay as to
reporting date including related on-cost,
such as workers compensation insurance
and superannuation.
Taxation
Income tax
Income tax on the profit or loss for the year
comprises current and deferred tax. Income
tax is recognised in the income statement
except to the extent that it relates to items
recognised directly in equity, in which case
it is recognised in equity.
Current tax is the expected tax payable on
the taxable income for the year, using tax
rates enacted or substantially enacted at
the balance sheet date, and any adjustment
to tax payable in respect of previous years.
Deferred tax is provided using the balance
sheet method, providing for temporary
differences between the carrying amounts
of assets and liabilities for financial
reporting purposes and the amounts
used for taxation purposes. The initial
recognition of assets or liabilities that
affect neither accounting nor taxable profit
and differences relating to investments in
subsidiaries to the extent that they will
probably not reverse in the foreseeable
future are temporary differences and are
not provided for. The amount of deferred
tax provided is based on the expected
manner of realisation or settlement of the
carrying amount of assets and liabilities,
using tax rates enacted or substantively
enacted at the balance sheet date.
Biotron Limited Annual Report 2008 I
19
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
A deferred tax asset is recognised only to
the extent that it is probable that future
taxable profits will be available against
which the asset can be utilised. Deferred
tax assets are reduced to the extent that it
is no longer probable that the related tax
benefit will be realised.
Goods and services tax
Revenue, 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 taxation authority. In these
circumstances, the GST is recognised as
part of the cost of acquisition of the asset
or as part 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 balance sheet.
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.
Revenue recognition
Finance income
Interest revenue is recognised as it accrues
using the effective interest rate method.
Earnings per share
The Company presents basic and diluted
earnings per share (EPS) data for its
ordinary shares. Basic EPS is calculated by
dividing the profit or loss attributable to
ordinary shareholders of the Company by
the weighted average number of ordinary
shares outstanding during the period.
Diluted EPS is determined by adjusting
the profit or loss attributable to ordinary
shareholders and the weighted average
number of ordinary shares outstanding for
the effects of all dilutive potential ordinary
20
I
Biotron Limited Annual Report 2008
shares, which comprise share options
granted to employees.
Incentive option plan
The Incentive Option Plan allows the
Company’s 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 shares
in the Company. The fair value of options
granted is measured at grant date and
spread as an expense over the period
during which the employees or directors
become unconditionally entitled to the
options. The fair value of the options
granted is measured using Black-Scholes
formula, taking into account the terms and
conditions upon which the options were
granted. The amount recognised as an
expense is adjusted to reflect the actual
number of options that vest except where
forfeiture is only due to share prices not
achieving the threshold for vesting.
Impairment
Financial assets
A financial asset is assessed at each
reporting date to determine whether
there is any objective evidence that it is
impaired. A financial asset is considered
to be impaired if any objective evidence
indicates that one or more events have had
a negative effect on the estimated future
cash flows of that asset.
An impairment loss in respect of a financial
asset measured at amortised cost is
calculated as the difference between its
carrying amount, and the present value of
the estimated future cash flows discounted
at the original effective interest rate. An
impairment loss in respect of an available-
for-sale financial asset is calculated by
reference to its fair value.
All impairment losses are recognised in
profit or loss. Any cumulative loss in
respect of an available-for-sale financial
asset recognised previously in equity is
transferred to the profit and loss.
An impairment loss is reversed if the
reversal can be related objectively to an
event occurring after the impairment
loss was recognised. For financial assets
measured at amortised cost and available-
for-sale financial assets that are debt
securities, the reversal is recognised in profit
or loss. For available-for-sale financial
assets that are equity securities the reversal
is recognised directly in equity.
Non-financial assets
The carrying amounts of the Company’s
non-financial assets are reviewed at each
reporting date to determine whether
there is any indication of impairment. If
any such indication exists then the asset’s
recoverable amount is estimated.
The recoverable amount of an asset or
cash-generating unit is the greater of its
value in use and its fair value less costs to
sell. 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.
An impairment loss is recognised if the
carrying amount of an asset or its cash-
generating unit exceeds its recoverable
amount. Impairment losses are recognised
in profit or loss.
An impairment loss in respect of goodwill
is not reversed. In respect of other assets
impairment losses recognised in prior
periods are assessed at each reporting
dare for any indications that the loss
has decreased or no longer exists. An
impairment loss is reversed if there has
been a change in the estimates used to
determine the recoverable amount. An
impairment loss is reversed only to the
extent that the asset’s carrying amount
does not exceed the carrying amount
that would have been determined, net
of depreciation or amortisation, if no
impairment had been recognised.
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
2. OTHER InCOME
Research and development grants
Sale of intellectual property
Total
3. LOSS FROM OPERATInG ACTIVITIES
Loss from ordinary activities has been arrived at after charging the following items:
Auditors’ remuneration paid to KPMG
- Audit and review of financial reports
- Other audit services
Depreciation
- Office equipment
- Plant and equipment
Direct research and development expenditure
expensed as incurred
Provision for employee entitlements
4. LOSS PER SHARE
2008
$
431,409
-
431,409
18,043
5,000
8,763
31,681
2007
$
-
402,457
402,457
25,783
1,000
4,586
46,906
1,303,421
60,913
2,412,418
(1,915)
The calculation of basic loss per share at 30 June 2008 was based on the loss attributable to ordinary shareholders of $1,882,093 (2007 -
$3,234,004) and a weighted average number of ordinary shares outstanding during the financial year ended 30 June 2008 of 94,070,553
(2007 - 89,743,565), calculated as follows:
Net loss for the year
1,882,093
3,234,004
Issued ordinary shares at 1 July
Effect of shares issued on 21 December 2007
Effect of shares issued on 31 March 2008
Effect of shares issued on 22 May 2008
2008
number
89,743,565
1,913,548
2,129,222
284,218
2007
number
89,743,565
-
-
-
Weighted average number of ordinary shares
94,070,553
89,743,565
Options disclosed in the Issued Capital note below are potential ordinary shares, but are not included in the calculation of diluted loss per
share as they are not dilutive.
Biotron Limited Annual Report 2008 I
21
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
2008
$
2007
$
5.
InCOME TAX EXPEnSE
numerical reconciliation between tax expense and pre-tax net profit
Loss before tax - continuing operations
(1,882,093)
(3,234,004)
Income tax using the domestic corporation tax rate of 30%
(564,628)
(970,201)
Increase in income tax expense due to:
- Adjustments not resulting in temporary differences
- Unrecognised temporary differences
-
Effect of tax losses not recognised
Income tax expense current and deferred
Deferred tax assets have not been recognised in respect of the following
items:
Deductible temporary differences (net)
Tax losses
Net
3,090
(41,243)
602,781
-
99,068
6,064,035
6,163,103
501
(22,962)
992,662
-
105,203
5,200,350
5,305,553
The deductible temporary differences and tax losses do not expire under the current tax legislation. Deferred tax assets have not been
recognised in respect of these items because it is not probable that future taxable profit will be available against which the Company can
utilise the benefits of the deferred tax asset.
6. RECEIVABLES
Current
Other debtors
GST receivable
7. OTHER
Current prepayments
Security deposits
22
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Biotron Limited Annual Report 2008
15,395
44,088
59,483
3,941
25,219
29,160
4,270
36,781
41,051
6,000
-
6,000
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
8. 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
Balance at 1 July
Additions
Depreciation
Carrying amount at the end of the financial year
Plant and equipment
Balance at 1 July
Depreciation
Carrying amount at the end of the financial year
Total carrying amount at the end of the financial year
2008
$
157,439
(93,784)
63,655
892,480
(841,052)
51,428
115,083
10,156
62,262
(8,763)
63,655
83,109
(31,681)
51,428
115,083
2007
$
95,177
(85,021)
10,156
892,480
(809,371)
83,109
93,265
12,550
2,192
(4,586)
10,156
130,015
(46,906)
83,109
93,265
Biotron Limited Annual Report 2008 I
23
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
9. TRADE AnD OTHER PAYABLES
Current
Creditors
Accruals
10. EMPLOYEE EnTITLEMEnTS
Current
Employee annual leave provision
Long service leave provision
Number of employees at the end of the financial year
2008
$
2007
$
227,030
90,597
317,627
72,202
34,116
106,318
2008
number
4
2008
$
117,618
-
117,618
45,405
-
45,405
2007
number
8
2007
$
11. ISSUED CAPITAL
Issued and paid up capital
104,443,565 (2007 - 89,743,565) fully paid ordinary shares
19,146,365
16,865,134
Fully paid ordinary shares
Balance at the beginning of the financial year
Issue of shares
Costs of issue
Balance at the end of financial year
24
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Biotron Limited Annual Report 2008
16,865,134
2,499,000
(217,769)
12,651,368
4,586,894
(373,128)
19,146,365
16,865,134
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
Effective 1 July 1998, the Company Law Review Act abolished the concept of par value shares and the concept of authorised capital.
Accordingly, the Company does not have authorised capital or par value in respect of its issued shares.
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.
During the year ended 30 June 2008, the Company issued 14,700,000 ordinary shares through a Share Purchase Plan for cash totalling
$2,499,000. Total issue costs of $217,769 were recognised as a reduction of the proceeds of issue of these shares.
During the year ended 30 June 2008, the Company issued 1,000,000 options (2007 – 1,500,000). No ordinary shares have been issued as a
result of the exercise of any option during the year ended 30 June 2008 and 30 June 2007.
The following options were on issue at 30 June 2008, each exercisable to acquire one fully paid ordinary share:
• 1,000,000 options, each exercisable at 35 cents to acquire one fully paid ordinary share at any time up to 30 September 2010. These
options were issued as part of underwriting fee on the Share Purchase Plan to Martin Place Securities during the year ended 30 June
2008.
• 4,450,000 options, each exercisable at 35 cents to acquire one fully paid ordinary share at any time up to 30 September 2010.
• 750,000 options, each exercisable at 40 cents to acquire one fully paid ordinary share at any time up to 30 September 2010.
• 500,000 options, each exercisable at 45 cents to acquire one fully paid ordinary share at any time up to 30 September 2010.
The fair value of the options at grant date was determined based on the Black-Scholes formula. The model inputs of the options issued
during the year ended 30 June 2008, were the Company’s share price of $0.22 at the grant date, a volatility factor of 89.4% based on historic
share price performance and a risk free interest rate of 7.25% based on the 10 year government bond rate.
The model inputs of the options issued during the year ended 30 June 2007 were the Company’s share price of $0.22 at the grant date, a
volatility factor of 50% based on historic share price performance and a risk free interest rate of 5.55% based on the 10 year government
bond rate.
Total expense arising from share based payment transactions recognised during the year ended 30 June 2008 was $88,223 (2007 – nil).
During the year ended 30 June 2008, 400,000 options with a value of $25,112 lapsed unexercised.
Biotron Limited Annual Report 2008 I
25
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
12. RESERVES
Equity compensation
Balance at the beginning of the financial year
Issue of options
Transfer to accumulated losses on lapse of options
Balance at the end of the financial year
This reserve represents the fair value, at the date of issue, of options issued as compensation.
13. ACCUMULATED LOSSES
Accumulated losses at the beginning of the financial year
Transfer from reserve
Net loss attributable to members of the Company
Accumulated losses at the end of the financial year
14. STATEMEnT OF CASH FLOWS
Reconciliation of cash flows from operating activities
Loss for the period
Non-cash items
Depreciation of plant and equipment
Provisions
Equity compensation
Gain on sale of intellectual property
Changes in assets and liabilities
Decrease in receivables
Decrease in inventories
Decrease in prepayments
(Increase)/decrease in payables
Increase in other
2008
$
2007
$
296,497
88,223
(25,112)
359,608
251,076
94,171
(48,750)
296,497
15,805,615
(25,112)
1,882,093
12,620,362
(48,750)
3,234,004
17,662,596
15,805,616
(1,882,093)
(3,234,004)
40,444
60,913
-
-
(18,434)
-
2,059
200,010
(25,218)
51,492
(1,915)
109,239
(402,457)
(36,228)
21,538
376
(153,170)
-
Net cash used in operating activities
(1,622,319)
(3,645,129)
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 Balance Sheet as follows:
Cash and cash equivalents in the statement of cash flows
2,063,596
1,378,722
26
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Biotron Limited Annual Report 2008
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
15. KEY MAnAGEMEnT PERSOnnEL DISCLOSURES
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
remuneration disclosed below represents the cost to the Company for the services provided under these arrangements.
No directors or senior executives receive performance related remuneration. No bonuses were paid during the year.
Details of director and senior executive remuneration and the nature and amount of each major element of the remuneration of each
director and senior executive of the Company are:
Year
Primary Salary and
Fees
Directors
Non-executive
Michael J. Hoy
(Chairman)
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Executive
Michelle Miller
(Managing Director)
Total, all specified
directors
Executives
Peter J. Nightingale
(Company Secretary)
Total, all specified
directors and executives
2008
2007
2008
2007
2008
2007
2008
2007
2008
2007
2008
2007
2008
2007
2008
2007
$
60,000
60,000
30,000
30,000
30,000
30,000
5,000
5,000
200,000
200,000
325,000
325,000
75,000
60,848
400,000
385,848
Post-Employment
Superannuation
Benefits
$
Equity
Compensation
Value of Options
$
Total
$
Options
as a % of
Remuneration
5,400
5,400
2,700
2,700
2,700
2,700
27,700
27,700
18,000
33,385
56,500
71,885
-
-
56,500
71,885
-
-
-
-
-
-
-
-
65,400
65,400
32,700
32,700
32,700
32,700
32,700
32,700
2,403
15,068
220,403
248,453
2,403
15,068
383,903
411,953
-
-
75,000
60,848
2,403
15,068
458,903
472,801
-
-
-
-
-
-
-
-
1%
6%
1%
4%
-
-
1%
3%
Biotron Limited Annual Report 2008 I
27
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
Equity holdings and transactions
The movement during the reporting period in the number of ordinary shares in the Company held directly, indirectly or beneficially, by each
specified director, including their personally-related entities, is as follows
Fully paid ordinary shareholdings and transactions - 2008
Held at 1 July 2007
Purchased
Received on exercise
of options
Sales
Held at 30 June
2008
Directors
Michael J. Hoy
Michelle Miller
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Executives
1,316,314
29,400
-
-
-
-
-
-
8,895,014
29,400
Peter J. Nightingale
1,610,497
29,400
Fully paid ordinary shareholdings and transactions - 2007
-
-
-
-
-
-
-
-
-
-
-
-
1,345,714
-
-
-
8,924,414
1,639,897
Held at 1 July 2006
Purchased
Received on exercise
of options
Sales
Held at 30 June
2007
Directors
Michael J. Hoy
Michelle Miller
Michael S. Hirshorn
Bruce Hundertmark
Peter G. Scott
Executives
1,316,314
-
-
-
8,895,014
Peter J. Nightingale
1,610,497
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,316,314
-
-
-
8,895,014
1,610,497
During the year ended 30 June 2008, Michael J. Hoy had an interest in an entity, CityPrint Holdings Pty Limited, which provided printing
services to the Company. Payments to CityPrint Holdings Pty Limited, which were in the ordinary course of business and on normal terms
and conditions, amounted to $24,259 (2007 - $23,480). Outstanding amounts at 30 June 2008 total nil (2007 - nil).
During the year ended 30 June 2008, Peter J. Nightingale had an interest in an entity, MIS Corporate Pty Limited, which provided full
administrative services, including rental accommodation, administrative staff, services and supplies, to the entity. Fees paid to MIS Corporate
Pty Limited during the year, which were in the ordinary course of business and on normal terms and conditions, amounted to $122,588
(2007 - $124,178). Outstanding amounts at 30 June 2008 total nil (2007 - nil).
Apart from the details disclosed in this note, no director has entered into a material contact with Company since the end of the previous
financial year and there were no material contracts involving directors; interests existing at year end.
28
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Biotron Limited Annual Report 2008
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
16. EMPLOYEE AnD DIRECTOR InCEnTIVE OPTIOn PLAn
At 30 June 2008, the Company had 4 employees (2007 - 8). 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.
During the year ended 30 June 2008, no options were granted to employees (2007 – 1,500,000). No ordinary shares have been issued as a
result of the exercise of any option granted pursuant to the Incentive Option Plan during the year ended 30 June 2008 and 30 June 2007.
17. FInAnCIAL InSTRUMEnTS DISCLOSURE
The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework. Risk management
policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor
risks and adherence to limits. These policies are reviewed regularly to reflect changes in market conditions and the Company’s activities.
The main risks arising from the Company’s financial instruments are credit risk, liquidity risk and interest rate risk. The summaries below
present information about the Company’s exposure to each of these risks, their objectives, policies and processes for measuring and
managing risk, the management of capital and financial instruments.
Credit risk
Credit risk arises mainly from the risk of counterparties defaulting on the terms of their agreements. The carrying amounts of the following
assets represent the Company’s maximum exposure to credit risk in relation to financial assets:
Cash and cash equivalents
Trade and other receivables
Security deposits
note
Carrying amount
2008
Carrying amount
2007
$
$
6
7
2,063,596
15,395
25,219
2,104,210
1,378,722
4,270
-
1,382,992
The Company mitigates credit risk on cash and cash equivalents by dealing with regulated banks in Australia. Credit risk of trade and other
receivables is very low as it consists predominantly of amounts recoverable from taxation authorities in Australia.
Impairment losses
No impairment has been taken up against the Company’s financial assets.
None of the Company’s trade and other receivables are past due, no amount receivable has been renegotiated.
Biotron Limited Annual Report 2008 I
29
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company’s approach to
managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both
normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.
The following are the contractual maturities of financial liabilities, including estimated interest payments:
Company
Carrying amount Contractual cash
flows
Less than one
year
Between one and
five years
Interest
30 June 2008
Trade and other payables
317,627
(317,627)
(317,627)
$
$
$
$
-
$
-
Ultimate responsibility for liquidity management rests with the Board of Directors. The Company manages liquidity risk by maintaining
adequate funding and monitoring of future rolling cash flow forecasts of its operations, which reflect management’s expectations of expected
settlement of financial assets and liabilities.
Interest rate risk
The Company’s income statement is affected by changes in interest rates due to the impact of such changes on interest income from cash
and cash equivalents and interest bearing security deposits.
At balance date, the Company had the following mix of financial assets exposed to variable interest rate risk that are not designated as cash
flow hedges:
Financial Assets
Cash and cash equivalents
Security deposits
Net exposure
Sensitivity analysis
note
7
2008
$
2,063,596
25,219
2,088,815
2007
$
1,378,722
-
1,378,722
An increase of 100 basis points in interest rates throughout the reporting period would have decreased the loss for the period by the amounts
shown below, whilst a decrease would have had the increased loss by the same amount. The Company’s equity consists of fully paid ordinary
shares. There is no effect on fully paid ordinary shares by an increase or decrease in interest rates during the period.
30 June 2008
30 June 2007
30
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Biotron Limited Annual Report 2008
Loss for the period
$
20,888
13,787
nOteS tO tHe Financial StatementS FOR tHe YeaR ended 30 JUne 2008
Capital management
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future
development of the business.
The Board ensures costs are not incurred in excess of available funds and will seek to raise additional funding through issues of shares for the
continuation of the Company’s operation. There were no changes in the Company’s approach to capital management during the year.
The Company is not subject to externally imposed capital requirements.
net fair values of financial assets and liabilities
The carrying amounts of financial assets and liabilities approximate their net fair values, given the short time frames to maturity and or
variable interest rates.
18. FInAnCIAL REPORTInG BY SEGMEnTS
The Company operates in the biotechnology industry in Australia.
Biotron Limited Annual Report 2008 I
31
directors’ declaration
In the opinion of the directors of Biotron Limited:
1. a)
the financial statements and notes set out on pages 14 to 31, and the remuneration disclosures that are contained in the
Remuneration Report in the Directors’ Report, set out on pages 9 to 11, are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Company’s financial position as at 30 June 2008 and of its performance for the financial year
ended on that date; and
(ii) complying with Australian Accounting Standards (including Australian Accounting Interpretations) and the Corporations
Regulations 2001;
b) the financial report also complies with International Financial Reporting Standards as disclosed in note 1;
c) the remuneration disclosures that are contained in the Remuneration Report in the Directors’ Report comply with Australian
Accounting Standards AASB 124 Related Party Disclosures, the Corporations Act 2001 and the Corporations Regulations 2001; and
d) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.
2. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the chief executive officer
and chief financial officer for the financial year ended 30 June 2008.
This report has been signed in accordance with a resolution of the directors and is dated 29 August 2008:
Michael J. Hoy
Chairman
Michelle Miller
Managing Director
32
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Biotron Limited Annual Report 2008
independent audit Report tO tHe memBeRS OF BiOtROn limited
Report on the financial report
We have audited the accompanying
financial report of Biotron Limited (the
Company), which comprises the balance
sheet as at 30 June 2008, and the income
statement, statement of recognised income
and expense and cash flow statement for
the year ended on that date, a description
of significant accounting policies and other
explanatory notes 1 to 18 and the directors’
declaration.
Directors’ responsibility for the financial
report
The directors of Biotron Limited are
responsible for the preparation and fair
presentation of the financial report in
accordance with Australian Accounting
Standards (including the Australian
Accounting Interpretations) and the
Corporations Act 2001. This responsibility
includes establishing and maintaining
internal control relevant to the preparation
and fair presentation of the financial report
that is free from material misstatement,
whether due to fraud or error; selecting and
applying appropriate accounting policies;
and making accounting estimates that are
reasonable in the circumstances.
In note 1, the directors also state, in
accordance with Australian Accounting
Standard AASB 101 Presentation of
Financial Statements, that the financial
report of the Company, comprising the
financial statements and notes, complies
with International Financial Reporting
Standards.
Auditor’s responsibility
Our responsibility is to express an opinion
on the financial report based on our audit.
We conducted our audit in accordance
with Australian Auditing Standards. These
Auditing Standards require that we comply
with relevant ethical requirements relating
to audit engagements and plan and
perform the audit to obtain reasonable
assurance whether the financial report is
free from material misstatement.
An audit involves performing procedures
to obtain audit evidence about the
amounts and disclosures in the financial
report. The procedures selected depend
on the auditor’s judgement, including
the assessment of the risks of material
misstatement of the financial report,
whether due to fraud or error. In making
those risk assessments, the auditor
considers internal control relevant to the
entity’s preparation and fair presentation
of the financial report 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 entity’s internal
control. An audit also includes evaluating
the appropriateness of accounting policies
used and the reasonableness of accounting
estimates made by the directors, as well as
evaluating the overall presentation of the
financial report.
We performed the procedures to
assess whether in all material respects
the financial report presents fairly, in
accordance with the Corporations Act
2001 and Australian Accounting Standards
(including the Australian Accounting
Interpretations), a view which is consistent
with our understanding of the Company’s
financial position and of its performance.
We believe that the audit evidence we have
obtained is sufficient and appropriate to
provide a basis for our audit opinion.
Independence
In conducting our audit, we have complied
with the independence requirements of the
Corporations Act 2001.
Auditor’s opinion on the financial
report
In our opinion:
(a) the financial report of Biotron Limited
is in accordance with the Corporations
Act 2001, including:
(i) giving a true and fair view of the
Company’s financial position
as at 30 June 2008 and of its
performance for the year ended on
that date; and
(ii) complying with Australian
Accounting Standards (including
the Australian Accounting
Interpretations) and the
Corporations Regulations 2001.
(b) the financial report also complies
with International Financial Reporting
Standards as disclosed in note 1.
Report on the remuneration report
We have audited the Remuneration
Report included in pages 9 to 11 of the
directors’ report for the year ended 30
June 2008. 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 auditing standards.
Auditor’s opinion
In our opinion, the remuneration report of
Biotron Limited for the year ended 30 June
2008, complies with Section 300A of the
Corporations Act 2001.
KPMG
29 August 2008
S.J. Board
Partner
Biotron Limited Annual Report 2008 I
33
additional Stock exchange 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:
Australian National University 3,378,658
fully paid ordinary shares
Distribution of Equity Securityholders
As at 31 July 2008, 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
2010 $0.35
Options
30 September
2010 $0.40
Options
30 September
2010 $0.45
Options
48
424
317
558
119
1,466
-
-
-
-
11
11
-
-
-
-
2
2
-
-
-
-
1
1
At 31 July 2008, 203 shareholders held less than a marketable parcel of 3,847 shares.
34
I
Biotron Limited Annual Report 2008
additiOnal StOck excHange inFORmatiOn
At 31 July 2008 the twenty largest fully paid ordinary shareholders held 47.96% of fully paid ordinary as follows:
name
Dr Angela Fay Dulhunty
Scott’s A V Pty Ltd
Rigi Investments Pty Ltd
Twynam Agricultural Group Pty Ltd
Australian National University
CBDF Pty Ltd
Lenvat Pty Ltd
Linkenholt Pty Ltd
Philip and Marylyn Board
Pathold No 222 Pty Ltd
Chris and Bhama Parish
Christopher David Hammer
1
2
3
4
5
6
7
8
9
10
11
12
13 Michael John Hoy
14 National Nominees Limited
15
16
17
18
Prof Alan Jonathan Berrick
Carrington Services Pty Ltd
Peter James Nightingale
Shano Developments Pty Ltd
19 Wightholme Nominees Pty Ltd
20
Jey Investment Pty Ltd
There are no current on-market buy-backs.
Fully Paid
Ordinary Shares
9,905,862
8,924,414
4,380,145
3,700,000
3,378,658
2,875,254
2,100,000
2,000,000
1,799,950
1,610,000
1,600,000
1,350,265
1,345,714
1,259,300
1,200,000
1,200,000
1,175,714
1,150,000
1,100,000
879,056
%
9.48
8.54
4.19
3.54
3.23
2.75
2.01
1.91
1.72
1.54
1.53
1.29
1.29
1.21
1.15
1.15
1.13
1.10
1.05
0.84
Biotron Limited Annual Report 2008 I
35
corporate directory
Auditors:
KPMG
Level 16, Riparian Plaza
71 Eagle Street
BRISBANE QLD 4000
Home Exchange:
Australian Stock Exchange Limited
20 Bridge Street
SYDNEY NSW 2000
Solicitors:
Minter Ellison
88 Phillip Street
SYDNEY NSW 2000
Directors:
Mr Michael J. Hoy (Chairman)
Dr Michelle Miller (Managing Director)
Dr Michael S. Hirshorn
Mr Bruce Hundertmark
Mr Peter G. Scott
Company Secretary:
Mr Peter J. Nightingale
Registered Office:
Level 2, 66 Hunter Street
SYDNEY NSW 2000
Phone:
Fax:
E-mail:
Homepage: www.biotron.com.au
61-2 9300 3344
61-2 9221 6333
enquiries@biotron.com.au
Principal Administration Office:
Suite 1.9, 56 Delhi Road
NORTH RYDE NSW 2113
Phone:
Fax:
61-2 9805 0488
61-2 9805 0688
Share Registrar:
Computershare Investor Services Pty Limited
PO Box 523
BRISBANE QLD 4001
Phone: 61-7 3237 2100
61-7 3229 9860
Fax:
Biotron Limited, incorporated and domiciled in Australia, is a publicly listed company limited
by shares.
Biotron Limited Annual Report 2008 I
36
Level 2, 66 Hunter Street, Sydney NSW 2000 Australia
Annual Report-2008
BIOTRON LIMITED ABN 60 086 399 144