Growth
through
medtech
innovation
Hydrix annual report 2021
Our vision
Improve
a billion
lives
To achieve our vision of improving a
billion lives, our mission is to develop,
invest in, and commercialise new
and innovative medical technologies:
Products which satisfy unmet needs,
significantly improve patient quality of
life, and reduce cost burdens of chronic
health diseases on global healthcare
systems.
We have the talent and know-how to
identify and develop high potential
medtech product winners to deliver
superior stakeholder value.
2 Executive Chairman’s letter
3 FY21 business highlights
6 A medtech strategy to drive growth
8 A cardiovascular technology focus
10 An innovation culture for market success
12 Picking winning ventures
14 Developing award winning products
16 Introducing LUDO
18 Global expansion to drive growth
19 People. Culture. Values.
20 Corporate directory
21 Financial statements
1
Hydrix annual report 2021 Gavin Coote
Executive Chairman
As we pursue our
strategy to become
a global medtech
company, we look
forward to initial
cardiovascular
product revenues
in CY 2022.
I would like to begin with a personal note of gratitude
to our investors, each Hydrix employee, the Board
members, our customers, suppliers, and business
partners. You all play a critical and pivotal role in our
collective purpose and bold vision to improve a billion
lives.
Our vision, purpose and stated objectives will drive,
sustain, and guide us. It will be our compass and
measurement through which we create significant
growth trajectory to build a formidable business
enterprise and achieve superior stakeholder returns.
Our vision for 2025
Hydrix’s history as a specialist product design and
engineering consulting company make us unique in
highly regulated markets. Our future is to build and
expand on this rich experience to become a primarily
medtech product development and distribution
company, with a focus on cardiovascular products and
services.
products
in market
Our objective is to have, by 2025, at least three
cardiovascular
producing
significant revenues – many times that of the existing
consulting business. Covid-19 has slowed the rate
of implementation, but we already have two cardiac
products under distribution arrangements in place.
The first is AngelMed, with distribution rights in eight
Asia Pacific countries, to begin roll out in CY2022.
The second is Phyzhon, where rights cover Australia
and New Zealand, also to begin market development
in CY2022. With additional company and technology
evaluations underway we are making exciting and
steady progress towards that vision.
Building a global medtech company
investment
The successful execution of Hydrix’s
strategy is focused on three important value drivers:
Talent, Strategy, Risk (TSR). Each strategic initiative we
undertake must pass a simple test: it fits the company
purpose; it is good for customers; we can deliver; and
the company can create value for all stakeholders. I will
describe briefly what we are doing in each of these key
value drivers.
Talent (T) focused on business development
We are
resource
future proofing our human
infrastructure to support our 2025 global growth
objectives. We are focused on how best to evolve our
employee value proposition to exceed the needs of a
more agile, work anywhere, anytime workforce; one
that is capable of adapting to a more complex world that
restricts face to face engagement that is traditional to
building deeply connected, enduring relationships.
Over the last 12 months we strengthened our high
calibre talent pool across product engineering, program
management, regulatory, clinical, and importantly, our
cardiac medical device sales and operations leadership.
We ended the year with 70 employees located across
Australia, USA, Europe, and Singapore. Hydrix annual
increased
employee engagement survey
substantially year on year to the Company’s highest ever
recorded level; proof-positive our talent management
strategy is working.
results
Strategy (S) product innovation & commercialisation
know-how driving growth
In 2021, a majority of Hydrix revenues were product
development services provided to external clients; many
of those clients are developing emerging cardiovascular
technologies. While revenues to external clients were
down 50% year on year, some product development
resources were expended on Ventures efforts which
provide potential for future equity returns in lieu of fee
revenues.
The carrying value of Hydrix ventures grew 27% to
$2.85 million during the year. The portfolio value
could grow more than five-fold as commercialisation
milestones are achieved by our investee companies
over the next 24 months and beyond. Investment
returns, in the future, can be reinvested to fund further
growth opportunities.
Risk (R) to deliver commensurate rewards
To achieve growth and create value requires appropriate
risk-taking and implementation of enterprise risk-
management systems. The business is well led and
governed. The Board and leadership team each have
FY21 business
highlights
Made seven sales
and implants of the
AngelMed Guardian, the
world’s only implantable
heart-attack detection
device, establishing
market credibility for
the technology ahead of
planned commercial sales
Completed significant
regulatory milestones
advancing us closer to
commercial sales of the
Guardian
Invested in sales and
business development
to drive growth in future
product sales and product
development services
Announced exclusive
agreement to distribute
Phyzhon Health’s novel
cardiovascular technology
Recorded receipts of $9.9
million and net cash used
in operating activities of
$1.9 million
Recapitalised the
company, paid off all
secured debt, ended with
$6.6 million cash on hand
2
3
Hydrix annual report 2021 Hydrix annual report 2021 decades of experience leading, governing, and growing
businesses both big and small that create meaningful
stakeholder returns.
We continue to review and reshape how we manage
Talent to execute Strategy and manage a high growth
Risk-adjusted investment agenda to achieve our goals.
Pathway to sustainable growth and profitability
We successfully recapitalised the business raising net
$12.75 million in equity and discharged $5.0 million
debt and interest costs. We ended the year with $6.6
million cash on hand. Hydrix listed options have the
potential to raise $2.3 million if fully exercised (ASX:
HYDO $0.12 exercise price, 31 July 2022 expiry).
The intended use of available capital is to continue to
support and advance:
•
•
•
Sales, marketing, operations, and regulatory
efforts to build towards commercial sales of
cardiac products commencing in CY 2022
Investments in existing and new high potential
medtech products
Product development services working capital
requirements
The audited financial accounts reflect the important
investments we are making to build a high growth,
cardiac medtech product sales operation, despite the
difficult trading conditions experienced in client product
development services. The Covid-19 pandemic has not
discouraged us from pursuing our vision and purpose.
The reported loss from ordinary activities after tax
was $9.8 million. After allowing for non-cash expenses
and intangible asset adjustments, and working capital
movements, that loss translates to $1.9 million of net
cash used in operating activities. A significant amount
of the loss from ordinary activities is attributable to
product development services, which was significantly
impacted by:
• Difficult trading conditions caused by the
pandemic, such as client project deferrals,
funding and budget constraints, hard lockdowns
hampering prospecting and face to face client
engagement, supply chain component availability
and increased lead times, and restricted access
to product development facilities and clinics
•
•
•
Future proofing
services business
client
development, making appointments in the USA
and Europe to better support our global client
base and improve sales prospecting outcomes
Investing in product development know-how,
systems, tools, and platform technologies to
advance our global competitiveness
Supporting clients, including through expending
resources to develop stronger positions
in
venture investments for future equity returns
We remain optimistic that business conditions will
improve beginning in the coming year. For historical
context, you might recall sales revenues to external
clients in the pre-Covid-19 6-month period to 31
December 2019, grew 44% over the comparative prior
year period; our focus remains on returning to growth.
Importantly, we also invested significantly in cardiac
product sales operations, regulatory and reimbursement
applications, and evaluating additional medical product
opportunities, all to pursue new sales growth.
While the financial accounts don’t yet reflect the
significant progress made transforming Hydrix into the
Global MedTech Product Company we plan to be, we
remain confident we are on the right track. The most
important focus for Hydrix right now is taking care of
our customers and creating value from our investments
for all stakeholders.
The future creates the challenge to think big
Where are we on our journey for long term business
success?
What we aspire to, is to be a highly successful ASX-listed
global medical technology company which improves
people’s health, safety, and well-being. For many of
today’s successful ASX-listed medtech companies who
have achieved significant and sustained 20, 30, 40-plus
times share price growth over a 10-plus year period, the
path has been more of a marathon, than a sprint.
Today we are building the solid foundations inspired
by the possibilities of a similar trajectory guided by a
very clear and singularly focused purpose to improve a
billion lives. We believe the course we have chartered,
each investment decision we make, and will continue
to make in medtech technologies, is a catalyst for long
term sustainable growth and a creator of significant
value for all stakeholders.
The Board, the Hydrix team, and I, remain passionately
committed to our collective purpose that underpins
the long-term success for Hydrix. We are positive
and unwavering in our commitment about our future
prospects and outlook and are delighted to have you
join us on this important journey.
Improving a billion lives matters.
Sincerely,
Gavin Coote
Executive Chairman
Sales &
Distribution
We identify breakthrough
medical products for
development and
distribution
Product
innovation
Our design, engineering
and regulatory capability
transforms ideas into
commercial products
Venture
investment
We invest in high
potential, early-stage
medical device
companies
Maximum impact as
a medtech product
company
5
Hydrix annual report 2021 A medtech strategy
to drive growth
A primary focus for Hydrix is investing in the large
addressable market of cardiovascular device technologies
31%
Percentage of all global deaths
from cardiovascular disease
$70-80 B
Estimated global CVD device
market for 2027
Ambulatory
Monitoring Devices
Interventional
Devices
Cardiac Rhythm
Management
Cardiovascular
Surgery Devices
$3.8 B
Global Market
2020
Estimated
2027
$17.5 B
Global Market
2020
$20.4 B
Global Market
2020
Estimated
2027
Estimated
2027
$6.7 B
$26.8 B
$31.2 B
$1.9 B
Global Market
2020
Estimated
2027
$2.1 B
investment focus for Hydrix
A significant
is the
large addressable market of cardiovascular device
technologies. It is a US$60 billion global market growing
at a CAGR of 6.9%, due to 14% of the global population
suffering from cardiovascular disease. The statistics are
remarkable:
• Cardiovascular disease is the world’s
•
•
leading cause of death
520 million live with CVD
1 in 5 people aged less than 70
will die from CVD
Over the past 18 months, Hydrix acquired the rights
to exclusively distribute unique cardiac devices in the
APAC Region:
• AngelMed Guardian, the world’s only patient
•
implantable heart attack alert system
Phyzhon, a unique pressure sensing guidewire
used in the treatment of patients with coronary
artery disease, during interventional procedures,
in particular stent placement
It is anticipated that significant revenue growth will
come from Hydrix Medical sales from calendar year
2022 onwards.
In
line with strategy, we continue to undertake
assessment and due diligence of companies, devices and
technologies that have a potential fit within our cardiac
product portfolio.
The Guardian market opportunity alone has potential
to be a significant catalyst for Hydrix. For example, the
Guardian:
•
Satisfies an unmet need for more than 500,000
APAC-region patients suffering annually from
acute coronary syndrome events (including
silent heart attacks)
• Has no like-for-like competitive product
• Can deliver strong revenues and gross profit
margins based on predicate market pricing in
the USA and Singapore
• Can achieve 1% to 3% of the unmet market,
which equates to annual product revenues of
$35 million to $100 million delivering strong
cash flow earnings
A successful market launch of the Guardian will be a
catalyst to access additional medtech products, venture
investing, and product development opportunities.
Growth in
product revenues is
the catalyst to drive
market value
Product
Sales
Investment
Returns
Design
Services
2021
>2025
7
Hydrix annual report 2021 A cardiovascular
technology focus
Improving patient quality of life and well-being
through introducing new medical technologies
Paul Kelly
General Manager
Hydrix Medical
As General Manager of the Medical division of Hydrix,
an integral part of my role is the identification, selection
and introduction of new technologies and treatments
that align with our cardiac device market strategy. This
includes distribution deals, venture investments, and
potential product acquisitions.
With market experience that spans more than 40 years,
I’ve been lucky to have shaped the medical technologies
landscape in Australia, introducing many outstanding
devices that the community has benefited from
including:
•
•
Coronary Stents
Advanced Cardiac Pacing Systems
• Heart Valve Replacement Devices
I am building on long time relationships with senior
management of many international companies that are
involved in the development of new cardiac technologies
and treatments.
The medical device market is undergoing a major
change with more treatments becoming less invasive,
requiring less hospital time, and allowing patients to
return to home earlier. The importance of returning
cardiovascular patients home sooner to go about
their daily lives and be with their loved ones cannot be
underestimated.
As a team we understand the needs of the
cardiovascular market and are identifying emerging
medical devices and technologies that will provide a
platform for long term sustainable product revenue
and earnings growth.
520 million
people live with
CVD &
18.6 million die
each year
Diagnosis of
heart attack
is complex
with atypical
or even silent
symptoms
Symptoms of
heart attack in
women are less
obvious than
for men
Vickie Edwards
Director Sales & Operations
Hydrix Medical
As a 20+ year veteran in the cardiovascular device
commercialisation space, and with a background in
cardiac and ICU nursing, I am excited to have joined
the Hydrix team as Director Sales & Operations to lead
efforts to bring new and innovative products to market.
It has been a very busy and rewarding past 12 months
for Hydrix Medical with a number of milestones
reached and I expect many more to follow. We were
proud to announce the first commercial implants of
the AngelMed Guardian performed by Dr Leslie Lam
in Singapore in August 2020. These were followed
by further implants in October 2020 and January
2021 under special access schemes. All patients are
doing very well. Two further sites in Singapore were
recently granted special access permits to implant the
Guardian.
immediately
AngelMed received FDA approval in June for the
Gen 3 AngelMed Guardian. Hydrix in-house regulatory
team
lodged regulatory submissions
for approvals in Australia, NZ and Singapore, and
commenced preparations for regulatory submissions
in Thailand, Malaysia, Indonesia, and Hong Kong.
Subject to regulatory timelines, approvals are expected
to be received throughout CY2022, with TGA approval
in early CY2022. NZ WAND listing was completed in
September 2021 and we expect to commence sales
once NZ emerges from hospital elective surgery
lockdowns due to Covid-19. Commercial sales are
expected to commence in Australia after receipt of TGA
approval and completion of applicable reimbursement
scheme approvals.
In this regard, in Australia, we are working to secure
a Medical Benefits Scheme (MBS) Item number and
Prosthetic listing for the AngelMed Guardian. Once
complete, private health insurance patients will be
eligible for reimbursement of the procedure and
device. Public hospital patients will also be eligible
for medical coverage under public health scheme
arrangements.
In terms of generating market awareness of the
Guardian, regulatory approvals are required prior to
marketing the Guardian into our target geographies.
We are, however, permitted to build awareness through
participation in key trade events. In January this year we
held a seminar on the AngelMed Guardian at Singapore
Live 2021, Asia’s pre-eminent annual live course in
cardiac interventions. The event was moderated by
Dr Leslie Lam, Farrer Park Hospital in Singapore with
presentations by USA-based Drs Kelly Tucker, David
Fischell and Andrew Kaplan. This event was followed
with virtual attendance and promotion of the Guardian
at the CSANZ (Cardiac Society of Australia and New
Zealand Meeting) in August.
Building from awareness generated at these events,
we are working with prospective master distributors
in South East Asia to sub-distribute the AngelMed
Guardian into Malaysia, Hong Kong, Thailand and
Indonesia. We will sell direct to market in Singapore.
We are working with a major private cardiac group
towards an arrangement whereby they will undertake
pre-approval implants under an Australian Clinical
Registry for the AngelMed Guardian, data for which will
be collated to further support the potential benefits of
the Guardian alert system.
In regards to early market adoption of the Phyzhon
Phyrari FFR catheter guidewire, the first in human study
while having been delayed for various reasons, is still
expected to commence and complete in the December
quarter 2021.
And finally, marketing and awareness activities are
ramping-up, and we continue to engage with key opinion
leaders in the cardiac industry to help commence
commercial sales in CY2022.
Much was achieved in 2021 to lay the foundations upon
which we will build a global medtech company; I fully
expect 2022 will be the year in which the hard work will
begin to pay off and we’ll see exciting growth shoots!
9
Hydrix annual report 2021 Building an innovation
culture for market success
Global clients expect broad innovation capability in
their development partners
Michael Trieu
General Manager
Hydrix Services
It’s been a year of growth for our product design and
engineering
the ongoing
teams, notwithstanding
disruptions and lockdowns. We advanced and matured
our flexible work-from-anywhere
arrangements
with improved tools and processes, creating a more
collaborative and engaging environment for project
teams and we continue to see efficiencies across project
operations because of these improvements.
To prepare for a return to the office we have been
revitalising our work environment, focusing on the
creation of innovative and collaborative spaces, which
is in line with our strategy of continuously improving
our innovation credentials. Through the recruitment of
senior business development personnel in both the USA
and Europe, we have created a more certain business
opportunity funnel, while establishing a global presence
close to our major markets.
Growing our
innovation culture
is fundamental
to the success
of our design &
development
offering
Launch
Manufacture
Distribution
& Sales
Prototype
Market
Release
Design
& Engineer
Regulatory &
Clinical Guidance
Commercialisation
Strategy
Hydrix offers a comprehensive
and unique product realisation offering
10
11
Some of the exciting projects the team has been engaged with in the last year include: • Market insights and voice of customer research in the US and EU to enable launch of our proprietary cardiac platform, LUDO• Non-invasive brain trauma injury (BTI) monitoring prototypes to use in early clinical studies intended to be developed into commercial products that create a new standard in patient care• Improving ergonomics and functional control systems for a robotic exoskeleton to significantly enhance patient and physician usability• Safety critical software and electronics control device for a novel mechanical heart pump• A cardiac technology device intended to enable doctors and nurses to deliver better care in Neonatal Intensive Care Units• Development of cloud based IoT utilities technologies with applications in domestic water supply• Development of an advanced radiation imaging technology for industrial, military and security applicationsAt Hydrix, we pride ourselves with having the best and brightest, not just in design and engineering but also in areas such as regulatory, clinical affairs and commercialisation. It is this high calibre foundation that allows us to provide award-winning commercialisation solutions to accelerate products on the road to success.I would like to thank every person in Hydrix who has helped transform so many concepts to real world successful products – continuing our voyage to improve a billion lives.Hydrix annual report 2021 Hydrix annual report 2021 Picking winning ventures
in medical technologies
Generating equity returns through investing
in high potential clients
Cyban
Gyder
Memphasys
AngelMed
*For illustrative
purposes only
Launch
Manufacture
Distribution
& Sales
Prototype
Market
Release
Design
& Engineer
Regulatory &
Clinical Guidance
Commercialisation
Strategy
Each of Hydrix’s venture companies
takes advantage of our unique
product realisation offering
12
Venture investment growth
The proportion of our early-stage medtech client ventures which
were revalued on milestone events during the past 12 months increased
36.5%, with the overall investment portfolio value increasing from
$2.2m to $3.1m including revaluations and additional investments.*
* On a constant currency basis, excluding unrealised FX impacts
Our portfolio includes ASX-listed Memphasys, private Melbourne-based
companies Cyban and Gyder, and US-based AngelMedical Systems.
Hydrix continues to actively assist each company in its development
journey and we remain very excited for the future prospects of each
organisation.
+10.3% increase in value
Memphasys - Felix, a unique technology to separate
high quality sperm for improved IVF procedures
+54.2% increase in value
Gyder Surgical - an intra-operative surgical
navigation system to assist surgeons position
implants during total hip arthroplasty
+16.7% increase in value
Cyban - non-invasive continuous tissue oxygen
monitor measuring cerebral (brain oxygen) in
intensive care and ED
Anticipate significant value uplift in FY22
AngelMed USA - the world’s first implantable
heart attack alert device
13
Hydrix annual report 2021 Hydrix annual report 2021 Developing award
winning products
Ansto Coris 360
x2
Hydrix recently worked with ANSTO (Australian
Nuclear Science and Technology Organisation) on
the development of a breakthrough Gamma radiation
detection system, the CORIS360™.
To keep workers safe and improve decision making for
those working in radioactive environments, it is critical
to identify and locate sources of radiation quickly and
accurately. ANSTO’s novel platform imaging technology,
CORIS360®, makes the invisible visible, by identifying
and imaging the exact location of radiation sources.
Hydrix assisted with
the product development
including industrial design, Graphical User Interface
(GUI) development, software architecture and thermal
design. Our role was critical in enabling the device
to meet the robustness and long-term performance
required in such demanding environments.
CORIS360 was recently awarded two Good Design
Gold Awards in both product design and engineering
catagories.
“It was a pleasure to collaborate with
the Hydrix team on the development
of the CORIS360. They assisted our
physicists and engineers to refine
what was a technical concept into a
commercial product. Their experience
and involvement in this project was
critical in creating a product that is
now designed with the user in mind,
from deployment through to device
operation. Hydrix has helped ANSTO
Detection and Imaging realise its first
commercial product, and one that we
are proud to take to market”.
Rosanne Robinson
General Manager
Business Development & Commercialisation
ANSTO
14
15
Hydrix annual report 2021 Hydrix annual report 2021 Introducing
LUDO
An award winning
MCS development platform
To address the continued rise in cardiovascular disease,
there is an urgency to develop smarter and safer
mechanical (pump) technologies to assist or replace
damaged hearts in both adults and children. As a leader
in the development of cardiac assist device control
systems Hydrix identified a common need among
companies developing artificial hearts and mechanical
circulatory assist devices (MCS). Control systems
for these devices are incredibly complex. Hydrix has
developed a first of kind MCS ‘platform technology’ for
emerging MCS innovators which they can tailor to meet
their development needs, and enable them to derisk
and accelerate their MCS device development.
LUDO has been warmly received in
the evolving MCS market. It was recently awarded
a Good Design Award in recognition of its
industry-changing design features.
Building on 10 years
of Mechanical Circulatory
Support (MCS)
market engagement
2010
2015
2020
AUS
Pneumatic VAD
AUS
Intravascular VAD
USA
TAH
EU
VAD
AUS
VAD
VAD
USA
Pneumatic VAD
USA
VAD
UK
pVAD
AUS
In preparing for the launch of LUDO, we undertook
market
insights and research across global MCS
markets. What this work revealed was that Hydrix
has a very strong reputation as a market-leader in
cardiac-assist device development.
It also helped us create a go-to-market strategy that
is proving very successful, resulting in substantial
awareness of both LUDO and Hydrix across medical
device innovators.
LUDO with the mock loop at
Monash University’s CREATElab
17
Hydrix annual report 2021 Global expansion
to drive growth
Hydrix is growing a global network
employees, customers and suppliers
travel restrictions was
In a year of disruption, one positive outcome from
the
Covid-19 pandemic
acceleration to recruit experienced medtech business
development executives in the USA and Europe. This
has enabled us to be closer to key clients as we expand
global revenue prospects.
Hydrix representatives are now located in Melbourne,
Sydney, Singapore, Malmö and Minneapolis.
Employees
70
International clients
16
FY21 new projects
26
Malmö
10%
FY21 revenue
Europe
Minneapolis
13%
FY21 revenue
USA
Singapore
77%
FY21 revenue
Asia Pacific
Melbourne
Sydney
18
Our values
Exceed
Expectations
Champion
Innovation
Be
Courageous
Unleash Our
Potential
People.
Culture. Values.
The bedrock upon which to achieve our vision to
improve a billion lives and our mission to build a
successful global medtech company, is our people. We
are focused on creating a culture and identity to which
our people feel connected. The values and behaviours
we are committed to engage with all our stakeholders
are as follows:
•
•
•
•
Exceed Expectations - we deliver outstanding
outcomes for all stakeholders
Champion Innovation – we apply initiative and
creativity to tackle tough problems
Be Courageous – we respect honesty,
transparency and diversity of thinking
Unleash Our Potential – we empower everyone
to achieve their best performance
Challenge
your
limits
Don’t limit your challengesHydrix annual report 2021 Corporate
directory
Directors Mr Gavin Coote
(Executive Chairman)
Ms Julie King
(Non-Executive Director)
Ms Joanne Bryant
(Non-Executive Director)
Mr Paul Wright
(Non-Executive Director)
Company Secretary Ms Alyn Tai
Registered Office
Principal place of business
Share register
30-32 Compark Circuit
Mulgrave VIC 3170
Phone: (03) 9550 8100
30-32 Compark Circuit
Mulgrave VIC 3170
Boardroom Pty Limited
Grosvenor Place
Level 12, 225 George Street
Sydney NSW 2000
Auditor Grant Thornton Audit Pty Ltd
Collins Square, Tower 5
727 Collins Street
Melbourne VIC 3008
Solicitors Holding Redlich
Level 8, 555 Bourke Street
Melbourne VIC 3000
Stock Exchange Listing Hydrix Limited's shares are listed on
the Australian Securities Exchange
(ASX code: HYD)
Websites
www.hydrix.com
www.hydrixmedical.com
Country of incorporation and domicile
Australia
Financial
statements
For the year ended 30 June 2021
ABN: 84 060 369 048
General i nfo rmation
The financial statements cover Hydrix Limited as a consolidated entity consisting of
Hydrix Limited and the entities it controlled at the end of, or during, the year. The
financial statements are presented in Australian dollars, which is Hydrix Limited's
functional and presentation currency.
Hydrix Limited is a listed public company limited by shares, incorporated and
domiciled in Australia. Its registered office and principal place of business are:
Reg is ter ed of fic e
3 0- 32 Com park Ci rcu i t
Mu lgrave VIC 31 70
Prin c ipal p lace of business
3 0- 32 Co mp ar k Cir cuit
Mu lgrave VIC 3170
A description of the nature of the consolidated entity's operations and its principal
activities are included in the directors' report, which is not part of the financial
statements.
The financial statements were authorised for issue, in accordance with a resolution
of directors, on 31 August 2020. The directors have the power to amend and reissue
the financial statements.
22 Directors’ report
35 Auditor’s independence declaration
36 Consolidated statement of profit & loss
37 Consolidated statement of financial position
38 Consolidated statement of changes in equity
39 Consolidated statement of cash flows
40 Notes accompanying the financial statements
77 Directors’ declaration
78 Independent auditor’s report
82 Additional securities exchange information
20
21
Hydrix annual report 2021 Hydrix annual report 2021 Directors’
report
The directors present their report, together with
the financial statements, on the consolidated entity
(referred to hereafter as the ‘consolidated entity’)
consisting of Hydrix Limited (referred to hereafter
as the ‘company’ or ‘parent entity’) and the entities
it controlled at the end of, or during, the year ended
30 June 2021.
Directors
The following persons were directors of Hydrix
Limited during the whole of the financial year and up
to the date of this report, unless otherwise stated:
22
Gain Coote
Executive Chairman
Appointed as Non-Executive Director 12 January 2017;
appointed as Non-Executive Chairman 28 March 2017;
appointed as Executive Chairman 1 January 2020
Mr Coote brings 25+ years executive
leadership
in corporate and financial strategy, and private
equity. His experience
includes 5 years with
PricewaterhouseCoopers in Australia and the USA, a
decade in technology mergers & acquisitions, corporate
development, and venture investing in the United
States, and fifteen years in Australian private equity in
various sectors healthcare, industrial and residential
construction materials, leisure and hospitality, and
sports and entertainment.
He has played significant roles in several turnaround
and acquisition-led growth strategies culminating in
successful trade sales. These include NASDAQ-listed
Platinum Technology Inc., where revenues grew from
$100 million to over $1 billion in 4 years driven by
organic revenue growth and 40+ acquisitions, and
eventually sold to CA Technologies for $3.5 billion, and
several above-average SME private-equity exits.
Gavin has a Bachelor of Economics & Politics
(Accounting) from Monash University, a Masters of
Business Administration from University of Michigan,
and is a Graduate of the Australian Institute of Company
Directors.
Joanne Bryant
Non-Executive Director
Appointed 29 November 2016
Ms Bryant brings more than 40 years’ of experience in
the health sciences as an occupational therapist, trainer
and vocational specialist. Currently, she is using this
expertise to provide forensic opinion as a vocational
specialist to the Victorian court system in addition to
running a small clinical practice. She has worked for many
years as an approved Rehabilitation Provider, providing
injury management services to both Commonwealth
and State organisations. Ms Bryant is a Member of the
Australian Association of Occupational Therapists and
a member of the GriefLine Board. She also manages a
small privately owned investment company.
Julie King
Non-Executive Chairman
Appointed 28 March 2017
Ms King holds a Bachelor of Commerce degree from
the University of Melbourne. With 40 years’ experience
in various industries including utilities, maritime, airline,
banking and FMCG, she is a specialist in commercial
negotiations and leading high performance leadership
and culture programs. Ms King currently operates
a private philanthropic family Foundation and is a
Graduate of the Australian Institute of Company
Directors.
Paul Wright
Non-Executive Director
Appointed 8 August 2018
Mr Wright has spent 18 years as CEO of three of
Australia’s leading international technology companies.
At ASX-listed Universal Biosensors (“UBI”), Paul built
long term partnerships with global diagnostics leaders
Siemens Healthcare and Johnson & Johnson, and led
the company through a period of strong growth and
new product development. Before UBI, Paul was CEO
of Invetech (1999-2007), an internationally renowned
product design and development company, and Vision
BioSystems (2007-2008), the major subsidiary of
ASX-listed Vision Systems Limited that developed,
manufactured and marketed diagnostic instruments
and consumables to pathology laboratories worldwide.
Prior to this, Paul spent over 8 years working in Europe,
North America and Asia with corporate strategy
consultants Bain & Company, advising multi-national
clients on growth strategy, mergers and acquisitions,
and manufacturing improvement. As General Manager
of Corporate Development at TNT Logistics, Paul
played a key role in the development of a major contract
logistics business in Asia establishing Joint Venture
businesses in China, Malaysia, and Indonesia.
Paul has a Masters Degree in Engineering from the
University of Cambridge, has studied corporate finance
at the London Business School, and is a Fellow of the
Australian Institute of Company Directors.
23
Hydrix annual report 2021 Hydrix annual report 2021 Hydrix Limited
Directors' Report
30 June 2021
Directors
stated:
Mr Gavin Coote
Executive Chairman
January 2020
Ms Julie King
Non-Executive Director
Appointed 28 March 2017
Directors.
Ms Joanne Bryant
Non-Executive Director
Appointed 29 November 2016
Mr Paul Wright
Non-Executive Director
Appointed 8 August 2018
The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'consolidated
entity') consisting of Hydrix Limited (referred to hereafter as the 'company' or 'parent entity') and the entities it controlled at the end of, or
during, the year ended 30 June 2021.
The following persons were directors of Hydrix Limited during the whole of the financial year and up to the date of this report, unless otherwise
Appointed as Non-Executive Director 12 January 2017; appointed as Non-Executive Chairman 28 March 2017; appointed as Executive Chairman 1
Mr Coote brings 25+ years executive leadership in corporate and financial strategy, and private equity. His experience includes 5 years with
PricewaterhouseCoopers in Australia and the USA, a decade in technology mergers & acquisitions, corporate development, and venture investing
in the United States, and fifteen years in Australian private equity in various sectors healthcare, industrial and residential construction materials,
leisure and hospitality, and sports and entertainment.
He has played significant roles in several turnaround and acquisition-led growth strategies culminating in successful trade sales. These include
NASDAQ-listed Platinum Technology Inc., where revenues grew from $100 million to over $1 billion in 4 years driven by organic revenue growth
and 40+ acquisitions, and eventually sold to CA Technologies for $3.5 billion, and several above-average SME private-equity exits.
Gavin has a Bachelor of Economics & Politics (Accounting) from Monash University, a Masters of Business Administration from University of
Michigan, and is a Graduate of the Australian Institute of Company Directors.
Ms King holds a Bachelor of Commerce degree from the University of Melbourne. With 40 years’ experience in various industries including
utilities, maritime, airline, banking and FMCG, she is a specialist in commercial negotiations and leading high performance leadership and culture
programs. Ms King currently operates a private philanthropic family Foundation and is a Graduate of the Australian Institute of Company
Ms Bryant brings more than 40 years’ of experience in the health sciences as an occupational therapist, trainer and vocational specialist.
Currently, she is using this expertise to provide forensic opinion as a vocational specialist to the Victorian court system in addition to running a
small clinical practice. She has worked for many years as an approved Rehabilitation Provider, providing injury management services to both
Commonwealth and State organisations. Ms Bryant is a Member of the Australian Association of Occupational Therapists and a member of the
GriefLine Board. She also manages a small privately owned investment company.
Mr Wright has spent the last 18 years as CEO of three of Australia’s leading international technology companies. At ASX-listed Universal
Biosensors (“UBI”), Paul built long term partnerships with global diagnostics leaders Siemens Healthcare and Johnson & Johnson, and led the
company through a period of strong growth and new product development. Before UBI, Paul was CEO of Invetech (1999-2007), an internationally
renowned product design and development company, and Vision BioSystems (2007-2008), the major subsidiary of ASX-listed Vision Systems
Limited that developed, manufactured and marketed diagnostic instruments and consumables to pathology laboratories worldwide.
Directors'
report
Prior to this, Paul spent over 8 years working in Europe, North America and Asia with corporate strategy consultants Bain & Company, advising
multi-national clients on growth strategy, mergers and acquisitions, and manufacturing improvement. As General Manager of Corporate
Development at TNT Logistics, Paul played a key role in the development of a major contract logistics business in Asia establishing Joint Venture
businesses in China, Malaysia, and Indonesia.
Paul has a Masters Degree in Engineering from the University of Cambridge, has studied corporate finance at the London Business School, and is a
Fellow of the Australian Institute of Company Directors.
Hydrix Limited
Hydrix Limited
Hydrix Limited
Hydrix Limited
Hydrix Limited
Hydrix Limited
Directors' Report
Directors' Report
Directors' Report
Directors' Report
Directors' Report
Directors' Report
Other current directorships
Paul Wright is a director of Memphasys Limited (ASX: MEM).
30 June 2021
30 June 2021
30 June 2021
30 June 2021
30 June 2021
30 June 2021
Company secretary
Ms Alyn Tai LLB (Hons) has held the role of Company Secretary since June 2016. She is a Partner with law firm Holding Redlich specialising in
corporate and commercial law, and the provision of company secretarial and legal counsel services to ASX-listed entities.
Company secretary
Company secretary
Company secretary
Ms Alyn Tai LLB (Hons) has held the role of Company Secretary since June 2016. She is a Partner with law firm Holding Redlich specialising in
Ms Alyn Tai LLB (Hons) has held the role of Company Secretary since June 2016. She is a Partner with law firm Holding Redlich specialising in
Ms Alyn Tai LLB (Hons) has held the role of Company Secretary since June 2016. She is a Partner with law firm Holding Redlich specialising in
corporate and commercial law, and the provision of company secretarial and legal counsel services to ASX-listed entities.
corporate and commercial law, and the provision of company secretarial and legal counsel services to ASX-listed entities.
corporate and commercial law, and the provision of company secretarial and legal counsel services to ASX-listed entities.
Company secretary
Company secretary
Ms Alyn Tai LLB (Hons) has held the role of Company Secretary since June 2016. She is a Partner with law firm Holding Redlich specialising in
Ms Alyn Tai LLB (Hons) has held the role of Company Secretary since June 2016. She is a Partner with law firm Holding Redlich specialising in
corporate and commercial law, and the provision of company secretarial and legal counsel services to ASX-listed entities.
corporate and commercial law, and the provision of company secretarial and legal counsel services to ASX-listed entities.
6
Meetings of directors
The number of meetings of the company's Board of Directors ('the Board') held during the year ended 30 June 2021, and the number of meetings
attended by each director were:
Meetings of directors
Meetings of directors
The number of meetings of the company's Board of Directors ('the Board') held during the year ended 30 June 2021, and the number of meetings
The number of meetings of the company's Board of Directors ('the Board') held during the year ended 30 June 2021, and the number of meetings
attended by each director were:
attended by each director were:
Meetings of directors
Meetings of directors
The number of meetings of the company's Board of Directors ('the Board') held during the year ended 30 June 2021, and the number of meetings
The number of meetings of the company's Board of Directors ('the Board') held during the year ended 30 June 2021, and the number of meetings
attended by each director were:
attended by each director were:
Meetings of directors
The number of meetings of the company's Board of Directors ('the Board') held during the year ended 30 June 2021, and the number of meetings
attended by each director were:
Attended
Director
Director
Director
Attended
Director
Director
Director
Attended
17
Mr Gavin Coote
17
Mr Gavin Coote
Mr Gavin Coote
17
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Ms Julie King
17
Ms Julie King
17
Ms Julie King
Ms Julie King
Ms Julie King
Ms Julie King
17
Ms Joanne Bryant
Ms Joanne Bryant
17
Ms Joanne Bryant
Ms Joanne Bryant
Ms Joanne Bryant
17
Ms Joanne Bryant
17
17
Mr Paul Wright
Mr Paul Wright
17
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
17
Board of Directors'
Board of Directors'
Board of Directors'
Board of Directors'
Board of Directors'
Board of Directors'
Meetings
Meetings
Meetings
Meetings
Meetings
Meetings
Attended
Held
Attended
Held
Held
Attended
Held
Held
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
17
Held
17
17
17
17
Nomination and
Nomination and
Nomination and
Nomination and
Nomination and
Nomination and
Remuneration Committee
Remuneration Committee
Remuneration Committee
Remuneration Committee
Remuneration Committee
Remuneration Committee
Held
Attended
Attended
Held
Held
Attended
Attended
Held
Attended
Attended
-
-
-
-
-
-
-
-
-
-
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
Held
Held
-
-
2
2
2
2
2
2
Held: represents the number of meetings held during the time the director held office.
Held: represents the number of meetings held during the time the director held office.
Held: represents the number of meetings held during the time the director held office.
Held: represents the number of meetings held during the time the director held office.
Held: represents the number of meetings held during the time the director held office.
Held: represents the number of meetings held during the time the director held office.
Interest in the shares and options of the company
At the date of this report, the relevant interests of directors in the company's securities were:
Interest in the shares and options of the company
Interest in the shares and options of the company
At the date of this report, the relevant interests of directors in the company's securities were:
At the date of this report, the relevant interests of directors in the company's securities were:
Interest in the shares and options of the company
Interest in the shares and options of the company
At the date of this report, the relevant interests of directors in the company's securities were:
At the date of this report, the relevant interests of directors in the company's securities were:
Interest in the shares and options of the company
At the date of this report, the relevant interests of directors in the company's securities were:
Audit and Risk Committee
Audit and Risk Committee
Audit and Risk Committee
Audit and Risk Committee
Audit and Risk Committee
Audit and Risk Committee
Attended
Held
Attended
Attended
Attended
Held
Held
Attended
Attended
-
-
-
-
-
-
-
-
-
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
Held
Held
-
-
2
2
2
2
2
2
Held
-
2
2
2
Director
Director
Director
Director
Director
Director
No. of Ordinary Shares
No. of Ordinary Shares
No. of Ordinary Shares
No. of Ordinary Shares
No. of Ordinary Shares
No. of Ordinary Shares
No. of Options
No. of Options
No. of Options
No. of Options
No. of Options
No. of Options
No. of Performance Rights
No. of Performance Rights
No. of Performance Rights
No. of Performance Rights
No. of Performance Rights
No. of Performance Rights
Mr Gavin Coote (i)
Mr Gavin Coote (i)
Mr Gavin Coote (i)
Mr Gavin Coote (i)
Mr Gavin Coote (i)
Mr Gavin Coote (i)
Ms Julie King (ii)
Ms Julie King (ii)
Ms Julie King (ii)
Ms Julie King (ii)
Ms Julie King (ii)
Ms Julie King (ii)
Ms Joanne Bryant (iii)
Ms Joanne Bryant (iii)
Ms Joanne Bryant (iii)
Ms Joanne Bryant (iii)
Ms Joanne Bryant (iii)
Ms Joanne Bryant (iii)
Mr Paul Wright (iv)
Mr Paul Wright (iv)
Mr Paul Wright (iv)
Mr Paul Wright (iv)
Mr Paul Wright (iv)
Mr Paul Wright (iv)
2,441,883
17,639,345
1,515,051
951,782
2,441,883
2,441,883
17,639,345
17,639,345
1,515,051
1,515,051
951,782
951,782
2,441,883
2,441,883
17,639,345
17,639,345
1,515,051
1,515,051
951,782
951,782
2,441,883
17,639,345
1,515,051
951,782
750,000
182,657
182,657
750,000
-
666,667
666,667
-
-
126,256
126,256
-
158,066 150,000
158,066 150,000
182,657
182,657
750,000
750,000
666,667
666,667
-
-
126,256
126,256
-
-
158,066 150,000
158,066 150,000
182,657
182,657
750,000
750,000
666,667
666,667
-
-
126,256
126,256
-
-
158,066 150,000
158,066 150,000
The directors' relevant interests in the company's securities shown above are as follows:
The directors' relevant interests in the company's securities shown above are as follows:
The directors' relevant interests in the company's securities shown above are as follows:
The directors' relevant interests in the company's securities shown above are as follows:
The directors' relevant interests in the company's securities shown above are as follows:
The directors' relevant interests in the company's securities shown above are as follows:
(i) Mr Gavin Coote has a relevant interest in 2,441,883 fully paid ordinary shares, which are held as follows:
(i) Mr Gavin Coote has a relevant interest in 2,441,883 fully paid ordinary shares, which are held as follows:
(i) Mr Gavin Coote has a relevant interest in 2,441,883 fully paid ordinary shares, which are held as follows:
(i) Mr Gavin Coote has a relevant interest in 2,441,883 fully paid ordinary shares, which are held as follows:
(i) Mr Gavin Coote has a relevant interest in 2,441,883 fully paid ordinary shares, which are held as follows:
(i) Mr Gavin Coote has a relevant interest in 2,441,883 fully paid ordinary shares, which are held as follows:
a. 1,970,385 fully paid ordinary shares are held by Beachridge Advisory Services Pty Ltd as Trustee for the Coote Family Discretionary Trust
b. 471,498 fully paid ordinary shares, held by a custodian as registered owner on behalf of the Coote Family Super Fund.
a. 1,970,385 fully paid ordinary shares are held by Beachridge Advisory Services Pty Ltd as Trustee for the Coote Family Discretionary Trust
a. 1,970,385 fully paid ordinary shares are held by Beachridge Advisory Services Pty Ltd as Trustee for the Coote Family Discretionary Trust
a. 1,970,385 fully paid ordinary shares are held by Beachridge Advisory Services Pty Ltd as Trustee for the Coote Family Discretionary Trust
a. 1,970,385 fully paid ordinary shares are held by Beachridge Advisory Services Pty Ltd as Trustee for the Coote Family Discretionary Trust
b. 471,498 fully paid ordinary shares, held by a custodian as registered owner on behalf of the Coote Family Super Fund.
b. 471,498 fully paid ordinary shares, held by a custodian as registered owner on behalf of the Coote Family Super Fund.
b. 471,498 fully paid ordinary shares, held by a custodian as registered owner on behalf of the Coote Family Super Fund.
b. 471,498 fully paid ordinary shares, held by a custodian as registered owner on behalf of the Coote Family Super Fund.
a. 1,970,385 fully paid ordinary shares are held by Beachridge Advisory Services Pty Ltd as Trustee for the Coote Family Discretionary Trust
b. 471,498 fully paid ordinary shares, held by a custodian as registered owner on behalf of the Coote Family Super Fund.
In addition, Gavin Coote has a relevant interest in 182,657 options and 750,000 performance rights.
In addition, Gavin Coote has a relevant interest in 182,657 options and 750,000 performance rights.
In addition, Gavin Coote has a relevant interest in 182,657 options and 750,000 performance rights.
In addition, Gavin Coote has a relevant interest in 182,657 options and 750,000 performance rights.
In addition, Gavin Coote has a relevant interest in 182,657 options and 750,000 performance rights.
In addition, Gavin Coote has a relevant interest in 182,657 options and 750,000 performance rights.
(ii) Ms Julie King has a relevant interest in 17,639,345 fully paid ordinary shares, held by John W King Nominees Pty Ltd.
(ii) Ms Julie King has a relevant interest in 17,639,345 fully paid ordinary shares, held by John W King Nominees Pty Ltd.
(ii) Ms Julie King has a relevant interest in 17,639,345 fully paid ordinary shares, held by John W King Nominees Pty Ltd.
(ii) Ms Julie King has a relevant interest in 17,639,345 fully paid ordinary shares, held by John W King Nominees Pty Ltd.
(ii) Ms Julie King has a relevant interest in 17,639,345 fully paid ordinary shares, held by John W King Nominees Pty Ltd.
(ii) Ms Julie King has a relevant interest in 17,639,345 fully paid ordinary shares, held by John W King Nominees Pty Ltd.
In addition, Julie King has a relevant interest in 666,667 options.
In addition, Julie King has a relevant interest in 666,667 options.
In addition, Julie King has a relevant interest in 666,667 options.
In addition, Julie King has a relevant interest in 666,667 options.
In addition, Julie King has a relevant interest in 666,667 options.
In addition, Julie King has a relevant interest in 666,667 options.
(iii) Ms Joanne Bryant has a relevant interest in 1,515,051 fully paid ordinary shares, which are held as follows:
(iii) Ms Joanne Bryant has a relevant interest in 1,515,051 fully paid ordinary shares, which are held as follows:
(iii) Ms Joanne Bryant has a relevant interest in 1,515,051 fully paid ordinary shares, which are held as follows:
(iii) Ms Joanne Bryant has a relevant interest in 1,515,051 fully paid ordinary shares, which are held as follows:
(iii) Ms Joanne Bryant has a relevant interest in 1,515,051 fully paid ordinary shares, which are held as follows:
(iii) Ms Joanne Bryant has a relevant interest in 1,515,051 fully paid ordinary shares, which are held as follows:
a. 817,050 fully paid ordinary shares are held by ELG Nominees Pty Ltd as trustee for The Gude Family No. 2 A/C
b. 508,001 fully paid ordinary shares are held by ELG Nominees Pty Ltd
c. 190,000 fully paid ordinary shares are held by JBB Superannuation Pty Ltd as trustee for the JBB Super Fund A/C
a. 817,050 fully paid ordinary shares are held by ELG Nominees Pty Ltd as trustee for The Gude Family No. 2 A/C
a. 817,050 fully paid ordinary shares are held by ELG Nominees Pty Ltd as trustee for The Gude Family No. 2 A/C
b. 508,001 fully paid ordinary shares are held by ELG Nominees Pty Ltd
b. 508,001 fully paid ordinary shares are held by ELG Nominees Pty Ltd
c. 190,000 fully paid ordinary shares are held by JBB Superannuation Pty Ltd as trustee for the JBB Super Fund A/C
c. 190,000 fully paid ordinary shares are held by JBB Superannuation Pty Ltd as trustee for the JBB Super Fund A/C
a. 817,050 fully paid ordinary shares are held by ELG Nominees Pty Ltd as trustee for The Gude Family No. 2 A/C
a. 817,050 fully paid ordinary shares are held by ELG Nominees Pty Ltd as trustee for The Gude Family No. 2 A/C
b. 508,001 fully paid ordinary shares are held by ELG Nominees Pty Ltd
b. 508,001 fully paid ordinary shares are held by ELG Nominees Pty Ltd
c. 190,000 fully paid ordinary shares are held by JBB Superannuation Pty Ltd as trustee for the JBB Super Fund A/C
c. 190,000 fully paid ordinary shares are held by JBB Superannuation Pty Ltd as trustee for the JBB Super Fund A/C
a. 817,050 fully paid ordinary shares are held by ELG Nominees Pty Ltd as trustee for The Gude Family No. 2 A/C
b. 508,001 fully paid ordinary shares are held by ELG Nominees Pty Ltd
c. 190,000 fully paid ordinary shares are held by JBB Superannuation Pty Ltd as trustee for the JBB Super Fund A/C
In addition, Joanne Bryant has a relevant interest in 126,256 options.
In addition, Joanne Bryant has a relevant interest in 126,256 options.
In addition, Joanne Bryant has a relevant interest in 126,256 options.
In addition, Joanne Bryant has a relevant interest in 126,256 options.
In addition, Joanne Bryant has a relevant interest in 126,256 options.
In addition, Joanne Bryant has a relevant interest in 126,256 options.
(iv) Mr Paul Wright has a relevant interest in 951,782 fully paid ordinary shares, held by a custodian as registered owner on behalf of PKW Super
Fund.
(iv) Mr Paul Wright has a relevant interest in 951,782 fully paid ordinary shares, held by a custodian as registered owner on behalf of PKW Super
(iv) Mr Paul Wright has a relevant interest in 951,782 fully paid ordinary shares, held by a custodian as registered owner on behalf of PKW Super
Fund.
Fund.
(iv) Mr Paul Wright has a relevant interest in 951,782 fully paid ordinary shares, held by a custodian as registered owner on behalf of PKW Super
(iv) Mr Paul Wright has a relevant interest in 951,782 fully paid ordinary shares, held by a custodian as registered owner on behalf of PKW Super
Fund.
Fund.
(iv) Mr Paul Wright has a relevant interest in 951,782 fully paid ordinary shares, held by a custodian as registered owner on behalf of PKW Super
Fund.
In addition, Paul Wright has a relevant interest in 158,066 options and 150,000 performance rights.
In addition, Paul Wright has a relevant interest in 158,066 options and 150,000 performance rights.
In addition, Paul Wright has a relevant interest in 158,066 options and 150,000 performance rights.
In addition, Paul Wright has a relevant interest in 158,066 options and 150,000 performance rights.
In addition, Paul Wright has a relevant interest in 158,066 options and 150,000 performance rights.
In addition, Paul Wright has a relevant interest in 158,066 options and 150,000 performance rights.
Hydrix Limited
Directors' Report
30 June 2021
Principal activities
The principal activities of the consolidated entity during the year were providing product design, engineering, and regulatory services to
customers in the medical industry, and the pursuit of the entity’s ‘Buy, Build, Invest’ medtech product growth strategy.
The consolidated entity operates three wholly owned subsidiary entities:
Hydrix Services transforms client ideas into market leading commercialisable products primarily under fee-for-services contracts.
It offers a
comprehensive range of engineering and regulatory services including software, electronics, mechanical, industrial design, and general product
development services. It’s product development and commercialisation services range from applied research through all stages of engineering
design, development, prototyping, manufacturer management, certification process management and supply for global markets.
Hydrix Medical distributes cardiac monitoring and diagnostic medical device technologies. During the year, it continued to expand its range of
products for distribution and completed its first seven sales of the AngelMed Guardian product for implant in Singapore; the implants were
completed under special access schemes in August 2020. The AngelMed Guardian continuously monitors a patient’s heart signal 24/7 uniquely
against the patient’s own baseline heart signal. It is the world’s only FDA-approved, implantable cardiac monitoring device and alerts patients of
an impending Acute Coronary Syndrome (ACS) event, including against deadly silent heart attacks.
On 30 October 2020, Hydrix Medical announced it had entered into an exclusive agreement with Phyzhon Health Inc, for the rights to distribute
Phyzhon’s PHYRARI FFR-WIRE product in Australia and New Zealand. The product is primarily for use by interventional cardiologists during
procedures which manage blockages in coronary arteries, including patients who have suffered a heart attack.
Hydrix Ventures which makes investments in high potential Hydrix Services clients to generate equity capital gains on investments where it can
directly leverage the entity’s powerful product innovation capability.
It made further early-stage investments during the year, which included
increasing its holdings in Gyder Surgical Pty Ltd and Cyban Pty Ltd.
The consolidated entity has approximately 70 employees and its headquarters are located in Mulgrave, Victoria Australia.
Dividends
No dividends have been paid or declared since the start of the period and the directors do not recommend the payment of a dividend in respect
of the period.
Review of operations
The consolidated entity continued to make progress with its ‘buy, build, invest’ strategy through the expansion of activities in the Hydrix Medical
and Hydrix Ventures.
The Hydrix Medical business recorded its first revenue from seven product sales of the AngelMed Guardian device in Singapore under special
access schemes. Pre-regulatory approval access schemes help accelerate market awareness ahead of the consolidated entity making full
regulatory submissions in Australia under the Therapeutic Goods Administration (TGA) and in Singapore, under the Health Sciences Authority
(HSA).
In October, Hydrix Medical entered into an exclusive agreement with Phyzhon Health Inc, to distribute Phyzhon’s PHYRARI FFR-WIRE product in
Australia and New Zealand and entered to an arrangement to conduct first-in-human (FIH) clinical trials.
In June, the US Food and Drug Administration (FDA) approved the upgraded battery for the AngelMed Guardian for commercial release in the
USA. The achievement of this milestone paves the way for Hydrix Medical to submit applications for regulatory and healthcare reimbursements,
commencing with Australia and Singapore.
Hydrix Ventures continued to invest in MedTech clients which include an orthopaedic surgical tool for hip replacements, an implantable heart
attack alert device, and a non-invasive brain trauma injury monitoring device. For each of these clients, Hydrix Services provided arms-length
design, engineering, and regulatory services.
During the year, the consolidated entity experienced disruptions from COVID-19 related matters, including slowdowns and deferrals of Hydrix
Services client projects and interruptions to various regulatory approval pathways for Hydrix Medical devices.
In response to impacts on short term revenue generating activities, the business lowered operating costs by temporarily reducing wages, building
lease and discretionary costs, and accessing government stimulus cost-offset programs.
While various discretionary expenditures were paused, we continued employee training and development, and internal developments to advance
proprietary engineering systems which increase the value of our client project management systems and product innovation capability.
It is
important we retain, develop, and incentivise the consolidated entity’s highly skilled and talented engineering and regulatory team, and talent
mix to leverage the Group’s powerful product innovation strategy.
24
25
7
7
7
7
7
7
8
Hydrix annual report 2021 Hydrix annual report 2021 Hydrix Limited
Directors' Report
30 June 2021
Matters subsequent to the end of the financial year
On 21 July 2021, the consolidated entity lodged its regulatory approval submission to the TGA for commercial distribution of the AngelMed
Guardian device. Further, the consolidated entity commenced the Medical Services Advisory Committee (MSAC) application process in Australia
to establish a surgical code for the reimbursement of fees pertaining to implant procedures. The Company also commenced the Prostheses List
Advisory Committee (PLAC) process to establish a device reimbursement code for the Guardian.
On 2 August 2021, the consolidated entity announced that Angel Medical Systems had completed the first commercial implantation in the USA of
the AngelMed Guardian device.
On 11 August 2021 the consolidated entity established Hydrix Medical New Zealand Ltd as a wholly owned subsidiary of Hydrix Medical Pty Ltd.
On 27 August 2021 the consolidated entity deferred the 17 March 2022 maturity of the $1,000,000 unsecured shareholder loan to 31 December
2022.
During July and August 2021, the Victorian Government made multiple public health and safety directions that required the consolidated entity to
reduce its on-site operations due to the COVID-19 pandemic. The consolidated entity's business remains operational after complying with the
additional restrictions, with most employees having already transitioned to working from home where possible. Where work is permitted on-site,
the consolidated entity continues to operate with processes and protocols in place to support the safety and wellbeing of our employees.
Likely developments and expected results of operations
The consolidated entity’s principal activities for the next financial year ending 30 June 2022 will continue to be medtech product design,
engineering and regulatory services, distribution of cardiovascular technologies and early stage medtech venture investing.
The consolidated entity will continue its ‘Buy, Build, Invest’ strategy to increase global market share and growth, and to extend the business' core
capabilities and customer offer. Areas of focus are within the consolidated entity's experience and know-how developing and commercialising
medtech product technologies which have the potential to significantly increase shareholder value.
Environmental regulation
The consolidated entity's operations are subject to environmental regulations under the law of the Commonwealth and State. The Board believes
that the consolidated entity has adequate systems in place for the management of its environmental requirements and is not aware of any
breach of those environmental requirements as they apply to the consolidated entity.
Non-IFRS financial measures
The consolidated entity uses certain measures to manage and report on its business that are not recognised under Australian Accounting
Standards. These measures are collectively referred to as “non-IFRS financial measures”. Non-IFRS financial measures are intended to supplement
the measures calculated in accordance with Australian Accounting Standards and are not a substitute for those measures. Underlying statutory
and pro forma results and measures are intended to provide shareholders additional information to enhance their understanding of the
performance of the consolidated entity.
A reconciliation between the loss before income tax expense to the net cash used in operating activities has been perfromed for the consolidated
entity. The following table reconciles the statutory results for the period ended 30 June 2021 to the net cash used in operating activities for the
consolidated entity (noting that this information has not been reviewed in accordance with Australian Auditing Standards):
Directors'
report
Hydrix Limited
Directors' Report
30 June 2021
Review of financials
The consolidated entity delivered revenues of $9,311,738 for a year-on-year decrease of 41.4% (30 June 2020: $15,899,742). Net cash used in
operating activities to support the growth and expansion of the consolidated entity was $1,933,245 compared to $196,954 for the prior year
ending 30 June 2020.
Net cash used in investing activities was $641,563 down from $1,067,482 in the prior year ending 30 June 2020. The consolidated entity made
two direct venture investments in clients and continues to operate one services contract under which it is entitled to earn equity in-lieu and cash
fees for services rendered. These arrangements focus on high potential investment capital gains.
Net cashflow from financing activities were $7,531,864 compared to $2,720,003 for the prior year ending 30 June 2020. These activities were net
of repaying $4,000,000 in borrowings to significantly deleverage the business and increase operational flexibility.
The operating loss before income tax for the consolidated entity of $9,778,693 increased by 240% compared to the prior year period (2020:
$2,872,734). This loss included a $4,561,327 in depreciation, amortisation and other non-cash charges which when added back results in an
EBITDA loss (before non-cash expenses) of $4,107,284 as identified in the table contained under "non-IFRS financial measures". Hydrix Medical
and other discretionary ‘buy, build, invest’ initiatives contributed $1,394,905 to the total operating loss before income tax (2020: $472,083).
As noted in the Financial Accounts, management assessed the carrying value of intangible assets as it is required to do under generally accepted
accounting standards. After taking into consideration various factors, management concluded that Goodwill was impaired and that the expected
benefit period for intangible assets with finite lifespans should be reduced to one year. While the revenue pipeline of the business remains
healthy, Hydrix Services revenues have been impacted by COVID. Management anticipates this situation will improve as global vaccinations are
advanced, international travel reopens and business appetite to invest in early stage medtech companies improves.
The fluidity of COVID over the near term increases the risks of impairment and makes the period that intangible assets can be expected to provide
benefits less certain. As such, management deemed it prudent to recognise the potential impairment risk and write the Goodwill off and reduce
the useful life for intangible assets with finite lifespans. The long-term prospects of the Group remain strong, and the powerful product
innovation capability of Hydrix Services is an important part of the long-term medtech product growth strategy and competitive advantage of the
Group.
In July 2020, the consolidated entity raised $3,040,647 through a 1-for-3 fully underwritten entitlement offer and placement issuing 40,541,960
shares of new common stock priced at $0.075c per share, each issued with 1-for-3 attaching Options or 13,513,987 Options. There were a
further 11,847,325 Options granted to corporate advisers and sub-underwriters. All Options have a strike price of $0.12 per share and an
expiration date of 31 July 2022. During the year 6,070,672 of these Options were exercised, raising a further $728,480.
In November 2020, the consolidated entity raised $10,000,000 through a Placement offer issuing 35,714,286 shares of new common stock priced
at $0.28c per share.
The consolidated entity’s cash position was $6,647,225 at 30 June 2021, compared to $1,690,194 at 30 June 2020. The main uses of cash were to
repay borrowings, support the principal activities of the business, and strategic growth initiatives.
Outlook
The business prospects for the consolidated entity remain strong taking into consideration several factors, including:
- cash on hand at 30 June 2021 of $6,647,225 and potential exercise by investors of approximately 19,290,850 Hydrix Listed Stock Options (HYDO)
at $0.12 cents prior 31 July 2022 for a total of $2,314,902 cash inflows;
- future product revenue and gross profit margins from Hydrix Medical distribution of cardiovascular products anticipated to commence in fiscal
2022;
- potential for future capital gains from investments made by Hydrix Ventures in high potential clients; and
- continued investment in global business development efforts to build a high potential prospective client pipeline of product development
projects.
Significant changes in the state of affairs
There were no significant changes in the state of affairs of the consolidated entity during the financial year.
Loss before income tax expense
Depreciation and amortisation expense
Finance costs
Interest income
EBITDA (after non-cash expenses)
Less: non-cash expenses
Share based payment expenses
Impairment of goodwill
Impairment of receivables
(Gain)/Loss on financial instruments at FVTPL
(Gain)/Loss on contingent consideration liability
Unrealised foreign exchange (Gain)/Loss
Contract asset write offs (c/fwd from FY20)
EBITDA (before non-cash expenses)
Less: other non-cash adjustments
Add: changes in operating assets and liabilities
Net cash used in operating activities
(5,849,242)
2,428,553
390,813
-
(3,029,876)
-
1,269,400
(94,602)
-
-
-
173,010
(1,682,068)
(792,348)
17,727
-
-
(774,621)
-
-
-
-
190,486
(215,281)
-
(799,416)
(557,393)
-
-
-
(557,393)
-
-
-
-
-
-
-
(557,393)
(45,164)
-
-
-
(45,164)
-
-
-
(250,303)
-
294,818
-
(649)
431,893
(776,360)
(557,393)
(507)
(1,030,877)
(2,534,546)
620
719,269
(15,328)
(1,829,985)
(9,778,693)
2,446,900
1,110,082
(15,328)
(6,237,039)
426,771
-
-
320,128
-
-
-
(1,083,086)
426,771
1,269,400
(94,602)
69,825
190,486
79,537
173,010
(4,107,284)
(224,112)
2,398,151
(1,933,245)
27
26
9
10
The decrease in operating assets and liabilities is due to the year on year decrease in product development services contract revenues.
Hydrix annual report 2021 Hydrix annual report 2021
Directors'
report
Hydrix Limited
Directors' Report
30 June 2021
REMUNERATION REPORT (Audited)
Hydrix Limited
Directors' Report
30 June 2021
REMUNERATION REPORT (Audited) (Continued)
The remuneration report details the key management personnel (KMP) remuneration arrangements for the consolidated entity, in accordance
with the requirements of the Corporations Act 2001 and its Regulations.
The Board has established a formal Nomination and Remuneration Committee which operates under the Nomination and Remuneration
Committee Charter approved and adopted by the Board.
KMP are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly,
including all directors.
The remuneration report is set out under the following main headings:
- Details of key management personnel
- Remuneration philosophy
- Details of remuneration
Details of Key Management Personnel
(i) Specified Directors
Mr Gavin Coote
Non-Executive Chairman - Appointed 28 March 2017, Executive Chairman - Appointed 1 January 2020
Ms Julie King
Non-Executive Director - Appointed 28 March 2017
Ms Joanne Bryant
Non-Executive Director - Appointed 29 November 2016
Mr Paul Wright
Non-Executive Director - Appointed 8 August 2018
Remuneration Philosophy
The performance of the company depends on the quality of the company’s directors, executives and employees and therefore the company must
attract, motivate and retain appropriately qualified industry personnel.
The remuneration policy of the company has been designed to align KMP objectives with shareholder and business objectives by providing a fixed
remuneration component and offering specific short-term and long-term incentives based on key performance areas affecting the company’s
financial results. The Board believes the remuneration policy to be appropriate and effective in its ability to attract and retain the high-quality
KMP to run and manage the company, as well as create goal congruence between directors, executives and shareholders.
The Board’s policy for determining the nature and amount of remuneration for KMP of the company is as follows:
- The remuneration policy is to be developed by the Nomination and Reumeration Committee and approved by the Board after professional
advice is sought from independent external consultants where required.
- All KMP receive a base salary, superannuation, options (subject to shareholder approval in the case of directors) and performance incentives.
- Performance incentives are only paid once predetermined key performance indicators (KPIs) have been met.
- Incentives paid in the form of options or rights are intended to align the interests of the directors and company with those of the shareholders.
In this regard, KMP are prohibited from limiting risk attached to those instruments by use of derivatives or other means.
- The Nomination and Remuneration Committee reviews KMP packages annually by reference to the consolidated entity's performance,
executive performance and comparable information from industry sectors.
The Nomination and Remuneration Committee reviews remuneration packages and practices applicable to the senior executives and the Board.
This role also includes responsibility for share option schemes, incentive performance packages and retirement and termination entitlements.
Remuneration levels are competitively set to attract the most qualified and experienced Directors and senior executives. The Nomination and
Remuneration Committee may obtain independent advice on the appropriateness of remuneration packages.
The performance of KMP is measured against criteria agreed annually with each executive and is based predominantly on the the performance of
the consolidated entity. All bonuses and incentives must be linked to predetermined performance criteria. The Nomination and Remuneration
Committee may, however, exercise its discretion in relation to approving incentives, bonuses and options. Any change must be justified by
reference to measurable performance criteria. The policy is designed to attract the highest calibre of executives and reward them for
performance results leading to long-term growth in shareholder wealth.
KMP are also entitled and encouraged to participate in the employee share and option arrangements to align directors’ interests with
shareholders’ interests.
The employment terms and conditions of KMP are formalised in contracts of employment or consultancy agreements.
In accordance with the company’s Constitution, the aggregate remuneration that can be paid to the company’s Non-Executive Directors is
$500,000 per annum, and the Board determines how this aggregate amount should be divided among individual directors and in what
proportions.
Further details of the Key Management Personnel remuneration for the year are detailed in Note 25.
Directors are entitled to be paid reasonable travelling, accommodation and other expenses incurred in consequence of their attendance at
meetings of directors and otherwise in the execution of their duties as directors. A director may also be paid additional amounts as fees or as the
directors determine where a director performs extra services or makes any special exertions, which in the opinion of the directors are outside the
scope of the ordinary duties of a director.
Details of remuneration
(i) Specified Director Remuneration
Mr Gavin Coote - Executive Chairman
Term and termination
Mr Coote’s appointment as Executive Chairman was effective on 1 January 2020, and continues on an ongoing basis under a services agreement
between Mr Coote and the company. Either the company or Mr Coote may terminate the services agreement with 6 months’ notice (other than
by the company for cause).
Remuneration
Mr Coote’s total fixed remuneration for his executive services under the employment agreement is $330,000 per annum (inclusive of
superannuation). Mr Coote’s remuneration for his executive services is in addition to the fee of $60,000 per annum (inclusive of superannuation)
that Mr Coote is currently entitled to receive (and will continue to receive) for his roles and responsibilities as Chairman and Director of the
Company.
Variable performance-based reward will be in the form of short-term and long-term incentives, as determined by the Board at its sole discretion.
Restraints
Mr Coote must not, during his employment, except with the written consent of the company, engage in (directly or indirectly) any undertaking or
business of a similar nature to, or in competition with, the business of the company. In addition, certain non-compete and non-solicit restraints
apply to Mr Coote for a period of 12 months after termination of his employment with the company.
Ms Julie King - Non-Executive Director
i. Fixed remuneration – The base remuneration is $48,000 per annum (exclusive of GST, but inclusive of any applicable superannuation).
ii. Expenses – Ms King is entitled to claim from the company reimbursement of reasonable out-of-pocket expenses properly incurred in the
performance of her duties and responsibilities (and upon production of satisfactory receipts).
28
29
11
12
Hydrix annual report 2021 Hydrix annual report 2021 Directors'
report
Hydrix Limited
Directors' Report
30 June 2021
REMUNERATION REPORT (Audited) (Continued)
Hydrix Limited
Hydrix Limited
Directors' Report
Directors' Report
30 June 2021
30 June 2021
Hydrix Limited
Directors' Report
30 June 2021
Hydrix Limited
Hydrix Limited
Hydrix Limited
Hydrix Limited
Directors' Report
Directors' Report
Directors' Report
Directors' Report
30 June 2021
30 June 2021
30 June 2021
30 June 2021
Hydrix Limited
Directors' Report
30 June 2021
Hydrix Limited
Directors' Report
30 June 2021
Hydrix Limited
Hydrix Limited
Directors' Report
Directors' Report
30 June 2021
30 June 2021
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
REMUNERATION REPORT (Audited) (Continued)
Ms Joanne Bryant - Non-Executive Director
i. Fixed remuneration – The base remuneration is $48,000 per annum (exclusive of GST, but inclusive of any applicable superannuation).
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Fixed remuneration
Fixed remuneration
Fixed remuneration
Fixed remuneration
At risk - STI
Fixed remuneration
Fixed remuneration
Fixed remuneration
At risk - STI
At risk - STI
Fixed remuneration
Fixed remuneration
Fixed remuneration
At risk - STI
At risk - STI
At risk - STI
ii. Expenses – Ms Bryant is entitled to claim from the company reimbursement of reasonable out-of-pocket expenses properly incurred in the
2021
2020
Name
2020
2021
2020
2021
Name
2021
Name
2021
2021
2020
2021
2020
2021
2020
2020
2021
2020
2021
2020
2021
2020
2021
Name
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2021
2020
Directors
Directors
Directors
Directors
performance of her duties and responsibilities (and upon production of satisfactory receipts).
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
74%
74%
Ms Julie King
Ms Julie King
Ms Julie King
Ms Julie King
100%
100%
Ms Joanne Bryant
Ms Joanne Bryant
Ms Joanne Bryant
Ms Joanne Bryant
100%
100%
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
61%
61%
Name
Name
Name
Name
Name
Name
Directors
Directors
Directors
Directors
Directors
Directors
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Ms Julie King
Ms Julie King
Ms Julie King
Ms Julie King
Ms Julie King
Ms Julie King
Ms Joanne Bryant
Ms Joanne Bryant
Ms Joanne Bryant
Ms Joanne Bryant
Ms Joanne Bryant
Ms Joanne Bryant
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright - Non-Executive Director
i. Fixed remuneration – The base remuneration is $48,000 per annum (exclusive of GST, but inclusive of any applicable superannuation).
74%
67% - -
100%
100% - -
100%
100% - -
61%
43% - -
Name
Directors
Mr Gavin Coote
Ms Julie King
Ms Joanne Bryant
Mr Paul Wright
26%
67% - -
67% - -
74%
33%
26%
67% - -
26%
67% - -
74%
74%
67% - -
26%
33%
26%
67% - -
74%
33%
74%
33%
26%
67% - -
74%
26%
33%
33%
26%
67% - -
74%
100% - -
100% - -
100%
-
-
100%
100% - -
100% - -
100%
100% - -
-
-
-
-
100% - -
100%
100%
-
-
-
-
100% - -
100%
-
-
-
-
100% - -
100%
100% - -
100%
-
-
100% - -
100%
100% - -
100%
-
-
-
100% - -
100%
-
100% - -
100%
-
-
100% - -
-
-
100% - -
100%
-
-
-
-
100% - -
100%
43% - -
39%
61%
43% - -
39%
57%
39%
43% - -
61%
61%
43% - -
43% - -
39%
57%
39%
43% - -
61%
61%
57%
57%
39%
43% - -
61%
57%
39%
57%
39%
43% - -
61%
67% - -
100% - -
100% - -
43% - -
At risk - LTI
At risk - LTI
At risk - STI
At risk - STI
At risk - STI
At risk - LTI
At risk - LTI
At risk - LTI
2021
2020
2020
2020
2021
2021
2021
2021
2021
2020
At risk - LTI
At risk - STI
2021
2021
At risk - LTI
2021
2020
2021
2020
26%
33%
26%
-
-
-
-
-
-
39%
57%
39%
2020
2020
2020
2020
At risk - LTI
2021
2020
2021
At risk - LTI
At risk - LTI
2020
-
-
-
-
-
-
ii. Expenses – Mr Wright is entitled to claim from the company reimbursement of reasonable out-of-pocket expenses properly incurred in the
performance of his duties and responsibilities (and upon production of satisfactory receipts).
N/A
Other KMP
Mr Peter Lewis AM
Other KMP
Other KMP
Other KMP
Other KMP
Mr Peter Lewis AM
Mr Peter Lewis AM
Mr Peter Lewis AM
Mr Peter Lewis AM
N/A
100%
N/A
N/A
N/A
N/A
Other KMP
Other KMP
Other KMP
Other KMP
Mr Peter Lewis AM
Mr Peter Lewis AM
Mr Peter Lewis AM
Mr Peter Lewis AM
Other KMP
Mr Peter Lewis AM
Other KMP
Mr Peter Lewis AM
100%
N/A
N/A -
100%
N/A
N/A -
100%
N/A
100%
N/A
100%
N/A -
100%
N/A -
100%
N/A -
N/A -
100%
100%
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
N/A -
Engagement of remuneration consultants
During the financial year ended 30 June 2021, the consolidated entity, through the Nomination and Remuneration Committee, engaged HR
Ascent, remuneration consultants, to review its existing remuneration policies and provide recommendations.
Share-based compensation
Share-based compensation
Issue of shares
Issue of shares
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Share-based compensation
Share-based compensation
Share-based compensation
Issue of shares
Issue of shares
Issue of shares
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Issue of shares
Issue of shares
Issue of shares
Issue of shares
Issue of shares
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Share-based compensation
Issue of shares
Details of shares issued to directors and other KMP as part of compensation during the year ended 30 June 2021 are set out below:
Remuneration details for the year ended 30 June 2021
The following tables detail, in respect to the financial year, the components of remuneration for each member of KMP of the company:
Table of benefits and payments for the year ended 30 June 2021
Name
Name
Name
Name
Name
Name
Name
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Shares
Name
Name
Date
Name
Date
Name
Date
Date
Date
Date
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
6-Nov-20
250,000
6-Nov-20
6-Nov-20
6-Nov-20
6-Nov-20
6-Nov-20
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
17-Dec-20
17-Dec-20
17-Dec-20
150,000
17-Dec-20
17-Dec-20
17-Dec-20
Issue Price
Date
Shares
Shares
Shares
Shares
Shares
$0.275
6-Nov-20
250,000
250,000
250,000
250,000
250,000
$0.275
17-Dec-20
150,000
150,000
150,000
150,000
150,000
$
Date
Date
Shares
Date
Issue Price
Issue Price
Issue Price
Issue Price
Issue Price
$68,750
$0.275
$0.275
$0.275
$0.275
$0.275
6-Nov-20
6-Nov-20
250,000
6-Nov-20
$0.275
$0.275
$41,250
$0.275
$0.275
$0.275
17-Dec-20
17-Dec-20
150,000
17-Dec-20
$
$
$
$
$
Shares
Shares
Issue Price
Shares
$68,750
$0.275
$68,750
$68,750
$68,750
$68,750
250,000
250,000
250,000
$0.275
$41,250
$41,250
$41,250
$41,250
$41,250
150,000
150,000
150,000
Issue Price
$0.275
$0.275
$
Issue Price
Issue Price
$68,750
$0.275
$0.275
$0.275
$41,250
$0.275
$
$68,750
$41,250
$
$
$68,750
$68,750
$41,250
$41,250
Fixed remuneration
2020
2020
2021
2020
2021
2020
2021
2020
At risk - STI
At risk - LTI
33%
33%
33%
57%
57%
57%
74%
100%
100%
61%
67% - -
100% - -
-
-
100% - -
-
-
43% - -
33%
57%
26%
39%
N/A
100%
N/A -
N/A -
Date
Shares
Issue Price
6-Nov-20
250,000
17-Dec-20
150,000
$0.275
$0.275
$
$68,750
$41,250
rights
granted
Grant date
& exercisable
Expiry date
Exercise price
option at grant
Vesting date
Fair value per
17-Dec-19
17-Dec-19
17-Dec-20
17-Dec-20
date
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-23
$0.00
$0.00
$0.00
$0.00
date
$0.275
$0.275
$0.255
$0.255
2021
$
2020
$
2019
$
9,311,738
15,899,742
14,165,305
(9,778,693)
(9,778,693)
(2,872,734)
(3,994,173)
(3,219,461)
(4,219,742)
2018
$
5,715,182
(5,539,445)
(5,080,967)
2017
$
793,258
(4,375,949)
(4,375,949)
2021
$0.19
$0.00
(6.84)
(6.84)
2020
$0.09
$0.00
(4.35)
(4.35)
2019
$0.22
$0.00
(6.54)
(6.54)
2018
$0.47
$0.00
(9.40)
(9.40)
2017
$0.38
$0.00
(8.64)
(8.64)
date
date
$0.275
$0.275
$0.275
$0.275
$0.255
$0.255
$0.255
$0.255
2017
2017
$
$
793,258
793,258
(4,375,949)
(4,375,949)
(4,375,949)
(4,375,949)
2017
2017
$0.38
$0.38
$0.00
$0.00
(8.64)
(8.64)
(8.64)
(8.64)
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Performance rights granted carry no dividend or voting rights.
Additional information
Additional information
Additional information
Additional information
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
Additional information
Additional information
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
Additional information
Additional information
Additional information
Additional information
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
Additional information
The earnings of the consolidated entity for the five years ended 30 June 2021 are summarised below:
262,557
-
24,943
3,399 -
Revenue
Revenue
Revenue
Revenue
Revenue
(Loss) before tax
(Loss) before tax
(Loss) before tax
(Loss) before tax
(Loss) before tax
(Loss) after tax
(Loss) after tax
(Loss) after tax
(Loss) after tax
(Loss) after tax
Revenue
(Loss) before tax
(Loss) after tax
Revenue
(Loss) before tax
(Loss) after tax
-
290,899
Revenue
Revenue
Revenue
Revenue
(Loss) before tax
(Loss) before tax
(Loss) before tax
(Loss) before tax
(Loss) after tax
(Loss) after tax
(Loss) after tax
(Loss) after tax
2021
$
9,311,738
(9,778,693)
(9,778,693)
2021
2021
2020
2021
2021
2021
$
$
$
$
$
$
15,899,742
9,311,738
9,311,738
9,311,738
9,311,738
9,311,738
(2,872,734)
(9,778,693)
(9,778,693)
(9,778,693)
(9,778,693)
(9,778,693)
(9,778,693)
(9,778,693)
(3,219,461)
(9,778,693)
(9,778,693)
(9,778,693)
2021
2020
2020
2019
2020
2020
2020
$
$
$
$
$
$
$
9,311,738
14,165,305
15,899,742
15,899,742
15,899,742
15,899,742
15,899,742
(3,994,173)
(9,778,693)
(2,872,734)
(2,872,734)
(2,872,734)
(2,872,734)
(2,872,734)
(9,778,693)
(3,219,461)
(3,219,461)
(4,219,742)
(3,219,461)
(3,219,461)
(3,219,461)
2019
2020
2021
2018
2019
2020
2021
2018
2019
2020
2019
2020
2021
2017
2017
2019
2019
2018
2018
2018
2017
2017
2019
2018
2017
2017
2018
2019
2019
2018
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
5,715,182
5,715,182
14,165,305
15,899,742
9,311,738
793,258
15,899,742
14,165,305
9,311,738
15,899,742
5,715,182
14,165,305
15,899,742
14,165,305
9,311,738
793,258
793,258
14,165,305
14,165,305
5,715,182
793,258
14,165,305
5,715,182
793,258
14,165,305
5,715,182
793,258
14,165,305
5,715,182
(5,539,445)
(5,539,445)
(5,539,445)
(3,994,173)
(2,872,734)
(9,778,693)
(3,994,173)
(2,872,734)
(9,778,693)
(2,872,734)
(3,994,173)
(3,994,173)
(2,872,734)
(3,994,173)
(9,778,693)
(4,375,949)
(4,375,949)
(3,994,173)
(5,539,445)
(4,375,949)
(4,375,949)
(3,994,173)
(5,539,445)
(4,375,949)
(5,539,445)
(3,994,173)
(4,375,949)
(3,994,173)
(5,539,445)
(4,219,742)
(3,219,461)
(9,778,693)
(4,219,742)
(3,219,461)
(9,778,693)
(5,080,967)
(4,219,742)
(3,219,461)
(4,219,742)
(3,219,461)
(9,778,693)
(4,375,949)
(4,375,949)
(4,219,742)
(4,219,742)
(5,080,967)
(5,080,967)
(5,080,967)
(4,375,949)
(4,375,949)
(4,219,742)
(5,080,967)
(4,375,949)
(5,080,967)
(4,219,742)
(4,375,949)
(4,219,742)
(5,080,967)
2018
2017
2017
2018
$
$
$
$
5,715,182
5,715,182
793,258
5,715,182
793,258
(4,375,949)
(5,539,445)
(4,375,949)
(5,539,445)
(5,539,445)
(5,080,967)
(4,375,949)
(5,080,967)
(4,375,949)
(5,080,967)
497,444 228,436
Total
1 Non-salary short-term benefits relate to professional fees payable to Mr Gavin Coote and Mr Paul Wright for consultancy and advisory work
performed by them outside the scope of their roles as director; the fees are at arm's length rates agreed by the Board.
2 Mr Gavin Coote was appointed Executive Chairman effective 1 January 2020.
3 Non-salary short-term benefits payable to Mr Paul Wright are non-monetary and were settled by way of issuing 155,172 number of shares.
4 Mr Peter Lewis AM transitioned from CEO to the role of Executive Vice President - Corporate Development effective 1 January 2020.
5 Short-term salary benefits payable to Mr Coote include $60,000 for work performed in his role as director.
6 Between 1 April 2020 and 30 June 2020, the fixed remuneration paid to all KMP was reduced by 20%.
5,886 148,431 -
50,128
930,324
2019
2021
2020
2021
2021
2018
2019
2017
2017
2017
2021
2020
2021
2017
Share price at financial year end ($)
$0.22
$0.19
$0.19
$0.19
$0.09
$0.47
$0.22
$0.38
$0.38
Share price at financial year end ($)
Share price at financial year end ($)
Share price at financial year end ($)
Share price at financial year end ($)
Share price at financial year end ($)
$0.38
$0.19
$0.09
$0.19
$0.38
Share price at financial year end ($)
Share price at financial year end ($)
Share price at financial year end ($)
Total dividends declared (cents per share)
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
Total dividends declared (cents per share)
Total dividends declared (cents per share)
Total dividends declared (cents per share)
Total dividends declared (cents per share)
Total dividends declared (cents per share)
$0.00
$0.00
$0.00
$0.00
$0.00
Total dividends declared (cents per share)
Total dividends declared (cents per share)
Total dividends declared (cents per share)
Basic loss per share (cents per share)
(9.40)
(6.54)
(6.84)
(4.35)
(6.84)
(6.84)
(6.54)
(8.64)
(8.64)
Basic loss per share (cents per share)
Basic loss per share (cents per share)
Basic loss per share (cents per share)
Basic loss per share (cents per share)
Basic loss per share (cents per share)
(8.64)
(6.84)
(4.35)
(6.84)
(8.64)
Basic loss per share (cents per share)
Basic loss per share (cents per share)
Basic loss per share (cents per share)
(6.54)
(6.84)
(6.84)
(6.84)
(4.35)
(9.40)
(6.54)
Diluted loss per share (cents per share)
(8.64)
(8.64)
Diluted loss per share (cents per share)
Diluted loss per share (cents per share)
Diluted loss per share (cents per share)
Diluted loss per share (cents per share)
Diluted loss per share (cents per share)
(6.84)
(8.64)
(4.35)
(6.84)
(8.64)
Diluted loss per share (cents per share)
Diluted loss per share (cents per share)
Diluted loss per share (cents per share)
2021
Share price at financial year end ($)
$0.19
Total dividends declared (cents per share)
$0.00
Basic loss per share (cents per share)
(6.84)
Diluted loss per share (cents per share)
(6.84)
Share price at financial year end ($)
Total dividends declared (cents per share)
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
2017
2020
2018
2019
2020
2018
2018
2018
$0.09
$0.22
$0.09
$0.47
$0.47
$0.38
$0.47
$0.47
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
(8.64)
(4.35)
(9.40)
(6.54)
(4.35)
(9.40)
(9.40)
(9.40)
(4.35)
(6.54)
(4.35)
(9.40)
(9.40)
(8.64)
(9.40)
(9.40)
2017
2018
2018
$0.47
$0.47
$0.38
$0.00
$0.00
$0.00
(8.64)
(9.40)
(9.40)
(9.40)
(8.64)
(9.40)
2018
2021
2020
2021
2019
2019
2019
2019
$0.19
$0.47
$0.09
$0.19
$0.22
$0.22
$0.22
$0.22
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
(6.84)
(9.40)
(4.35)
(6.84)
(6.54)
(6.54)
(6.54)
(6.54)
(6.84)
(4.35)
(6.84)
(6.54)
(6.54)
(9.40)
(6.54)
(6.54)
2021
2019
$0.19
$0.22
$0.00
$0.00
(6.84)
(6.54)
(6.84)
(6.54)
2019
2021
2020
2020
2020
2020
$0.19
$0.09
$0.09
$0.22
$0.09
$0.09
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
(6.54)
(6.84)
(4.35)
(4.35)
(4.35)
(4.35)
(6.84)
(4.35)
(4.35)
(6.54)
(4.35)
(4.35)
2020
$0.09
$0.00
(4.35)
(4.35)
2017
$0.38
$0.00
(8.64)
(8.64)
2018
$0.47
$0.00
(9.40)
(9.40)
2017
$0.38
$0.00
(8.64)
(8.64)
2019
$0.22
$0.00
(6.54)
(6.54)
2018
$0.47
$0.00
(9.40)
(9.40)
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
The factors that are considered to affect total shareholders return (TSR) are summarised below:
30
31
13
14
14
14
14
14
14
14
14
14
14
14
Directors
Mr Gavin Coote1,2
Ms Julie King2
Ms Joanne Bryant2
Mr Paul Wright2
Short-term benefits
Salary
$
367,260
-
-
42,627
Fees
$
-
41,268
41,268
-
Share-based payments
Long-term
benefits
Long Service
Leave
$
Post-
employment
benefits
Super-
annuation
Total
$
$
529,769
26,815
- 45,600
-
4,332 -
4,332 -
- 45,600
-
3,956 - 26,838 - 73,421
Equity-settled
shares
$
Equity-settled
options
$
5,014 130,680 -
Total
1 Short-term salary benefits payable to Mr Coote include $60,000 for work performed in his role as director.
2 Between 1 July 2020 and 30 September 2020, the fixed remuneration paid to all directors was reduced by 20%.
82,536
39,435
409,887
5,014 157,518 -
694,390
Name
Name
Name
Name
Name
Name
Name
Name
Table of benefits and payments for the year ended 30 June 2020
Short-term benefits
Salary
$
Fees
$
192,260 100,900
41,268
-
41,268
-
45,000
42,627
Share-based payments
Long-term
benefits
Long Service
Leave
$
Post-
employment
benefits
Super-
annuation
$
12,565
4,332 -
4,332 -
3,956 - 55,662 -
Equity-settled
shares
$
Equity-settled
options
$
2,486 92,769 -
Total
$
400,980
- 45,600
- 45,600
147,245
-
-
Mr Gavin Coote
Mr Gavin Coote
Mr Paul Wright
Mr Paul Wright
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Paul Wright
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Paul Wright
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Mr Gavin Coote
Directors
Mr Gavin Coote1,2,5,6
Ms Julie King6
Ms Joanne Bryant6
Mr Paul Wright1,3,6
Other KMP
Mr Peter Lewis AM4,6
Grant date
Number of
performance
Name
Name
rights
granted
250,000
Mr Gavin Coote
Mr Paul Wright
150,000
250,000
Mr Gavin Coote
Mr Gavin Coote
250,000
Number of
Number of
Number of
Number of
Number of
performance
performance
performance
performance
performance
Name
Grant date
rights
rights
rights
rights
rights
granted
granted
granted
granted
granted
17-Dec-19
250,000
250,000
250,000
250,000
250,000
Mr Gavin Coote
Mr Gavin Coote
Mr Paul Wright
Mr Paul Wright
17-Dec-19
150,000
150,000
150,000
150,000
150,000
17-Dec-20
250,000
250,000
Mr Gavin Coote
Mr Gavin Coote
250,000
250,000
250,000
Mr Gavin Coote
Mr Gavin Coote
250,000
250,000
17-Dec-20
250,000
250,000
250,000
Number of
Vesting date
performance
& exercisable
Grant date
Grant date
Grant date
Grant date
rights
date
granted
250,000
30-Jun-21
17-Dec-19
17-Dec-19
17-Dec-19
17-Dec-19
30-Jun-21
150,000
17-Dec-19
17-Dec-19
17-Dec-19
17-Dec-19
30-Jun-21
250,000
17-Dec-20
17-Dec-20
17-Dec-20
17-Dec-20
250,000
17-Dec-20
17-Dec-20
30-Jun-22
17-Dec-20
17-Dec-20
Number of
Number of
Number of
Vesting date
Vesting date
Vesting date
Vesting date
Vesting date
performance
performance
performance
Expiry date
Grant date
& exercisable
& exercisable
& exercisable
& exercisable
& exercisable
rights
rights
rights
date
date
date
date
date
granted
granted
granted
250,000
30-Jun-22
250,000
17-Dec-19
250,000
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-22
150,000
150,000
17-Dec-19
150,000
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-22
250,000
250,000
17-Dec-20
250,000
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
250,000
250,000
17-Dec-20
250,000
30-Jun-22
30-Jun-22
30-Jun-23
30-Jun-22
30-Jun-22
30-Jun-22
17-Dec-19
17-Dec-19
17-Dec-20
17-Dec-20
Mr Gavin Coote
Mr Paul Wright
Mr Gavin Coote
Mr Gavin Coote
Grant date
Expiry date
Vesting date
Expiry date
Expiry date
Expiry date
Expiry date
Exercise price
Grant date
& exercisable
Grant date
date
Vesting date
& exercisable
date
Fair value per
Vesting date
Vesting date
Expiry date
option at grant
Exercise price
Exercise price
& exercisable
& exercisable
Exercise price
Exercise price
Exercise price
date
date
date
Fair value per
Fair value per
Fair value per
Fair value per
Fair value per
Expiry date
Expiry date
Expiry date
Exercise price
Exercise price
option at grant
option at grant
option at grant
option at grant
option at grant
date
date
date
date
date
Fair value per
Exercise price
option at grant
date
Number of
Fair value per
Fair value per
Fair value per
performance
option at grant
option at grant
option at grant
date
Exercise price
17-Dec-19
17-Dec-19
17-Dec-20
17-Dec-20
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-23
$0.00
17-Dec-19
30-Jun-21
17-Dec-19
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
$0.00
17-Dec-19
30-Jun-21
17-Dec-19
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
$0.00
17-Dec-20
30-Jun-21
17-Dec-20
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
$0.00
17-Dec-20
30-Jun-22
17-Dec-20
30-Jun-23
30-Jun-23
30-Jun-23
30-Jun-23
$0.00
30-Jun-21
$0.00
30-Jun-21
$0.00
30-Jun-21
$0.00
30-Jun-22
$0.275
$0.00
$0.00
$0.00
$0.00
30-Jun-21
30-Jun-22
30-Jun-21
$0.275
$0.00
$0.00
$0.00
$0.00
30-Jun-21
30-Jun-22
30-Jun-21
$0.255
$0.00
$0.00
$0.00
$0.00
30-Jun-21
30-Jun-22
30-Jun-21
$0.00
$0.00
$0.255
$0.00
$0.00
30-Jun-22
30-Jun-23
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-23
$0.275
$0.00
$0.275
$0.275
$0.275
$0.275
30-Jun-22
30-Jun-22
$0.275
$0.00
$0.275
$0.275
$0.275
$0.275
30-Jun-22
30-Jun-22
$0.255
$0.00
$0.255
$0.255
$0.255
$0.255
30-Jun-22
30-Jun-22
$0.00
$0.255
$0.255
$0.255
$0.255
$0.255
30-Jun-23
30-Jun-23
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.275
$0.275
$0.00
$0.255
$0.00
$0.00
$0.255
250,000
150,000
250,000
250,000
$0.275
$0.275
$0.255
$0.255
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
The 250,000 shares issued to Mr Gavin Coote were for nil consideration, upon vesting of performance rights issued under the consolidated
entity's long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 06-Nov-20.
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
The 150,000 shares issued to Mr Paul Wright were for nil consideration, upon vesting of performance rights issued under the consolidated entity's
long term incentive plan. The performance rights were granted on 17-Dec-19, vested on 30-Jun-20 and were exercised on 17-Dec-20.
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
financial year or future reporting years are as follows:
financial year or future reporting years are as follows:
financial year or future reporting years are as follows:
financial year or future reporting years are as follows:
financial year or future reporting years are as follows:
Performance rights
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
financial year or future reporting years are as follows:
financial year or future reporting years are as follows:
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
financial year or future reporting years are as follows:
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
financial year or future reporting years are as follows:
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
financial year or future reporting years are as follows:
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and other KMP in this
financial year or future reporting years are as follows:
Hydrix annual report 2021 Hydrix annual report 2021
Directors'
report
Hydrix Limited
Directors' Report
30 June 2021
REMUNERATION REPORT (Audited) (Continued)
Additional disclosures relating to KMP
Shareholding
The number of shares in the company held during the financial year by each director and other members of KMP of the consolidated entity,
including their personally related parties is set out below:
Mr Gavin Coote
Ms Julie King
Ms Joanne Bryant
Mr Paul Wright
Balance at
the start of
the year
Received as
part of
remuneration
1,643,912 250,000
-
15,639,345
1,136,287
-
327,586 150,000
18,747,130
Additions
Disposals /
Other
Balance at the
end of the year
547,971 -
2,000,000 -
378,764 -
474,196 -
-
2,441,883
17,639,345
1,515,051
951,782
22,548,061
400,000 3,400,931
Performance rights holding
The number of performance rights over ordinary shares in the company held during the financial year by each director and other members of
KMP of the consolidated entity, including their personally related parties is set out below:
Mr Gavin Coote
Ms Julie King
Ms Joanne Bryant
Mr Paul Wright
Balance at
the start of
the year
Granted
Exercised
Expired /
forfeited /
other
500,000 500,000
-
-
300,000
800,000 500,000 400,000
- -
- -
-
250,000 -
-
-
150,000 -
-
Balance at the
end of the year
750,000
-
-
150,000
900,000
The performance rights vest subject to satisfaction of prescribed vesting conditions including financial, operational, corporate governance,
strategic planning and business development objectives set by the Board.
This concludes the remuneration report, which has been audited
Hydrix Limited
Hydrix Limited
Hydrix Limited
Directors' Report
Directors' Report
Directors' Report
30 June 2021
30 June 2021
30 June 2021
Shares under option / performance rights
Shares under option / performance rights
Shares under option / performance rights
At the date of this report, there were 20,710,070 options and 900,000 performance rights to acquire ordinary shares of the company as follows:
At the date of this report, there were 20,710,070 options and 900,000 performance rights to acquire ordinary shares of the company as follows:
At the date of this report, there were 20,710,070 options and 900,000 performance rights to acquire ordinary shares of the company as follows:
Class of Unlisted
Class of Unlisted
Class of Unlisted
Options
Options
Options
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Attaching options
Attaching options
Attaching options
Underwriter options
Underwriter options
Underwriter options
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Attaching options
Attaching options
Attaching options
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Employee LTIP
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
Note
Note
Note
(i)
(i)
(i)
(i)
(i)
(i)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(iii)
(iii)
(iii)
(iv)
(iv)
(iv)
(v)
(v)
(v)
(v)
(v)
(v)
(v)
(v)
(v)
(v)
(v)
(v)
(vi)
(vi)
(vi)
(vii)
(vii)
(vii)
(vii)
(vii)
(vii)
(vii)
(vii)
(vii)
(vii)
(vii)
(vii)
(viii)
(viii)
(viii)
(viii)
(viii)
(viii)
Exercise
Exercise
Exercise
Price
Price
Price
$0.000
$0.000
$0.000
$0.000
$0.000
$0.000
$0.290
$0.290
$0.290
$0.290
$0.290
$0.290
$0.290
$0.290
$0.290
$0.290
$0.290
$0.290
$0.120
$0.120
$0.120
$0.120
$0.120
$0.120
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.120
$0.120
$0.120
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.075
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
Vesting Date
Vesting Date
Vesting Date
Expiry Date
Expiry Date
Expiry Date
Grant Date
Grant Date
Grant Date
Fair Value at
Fair Value at
Fair Value at
Grant Date
Grant Date
Grant Date
Balance at 30
Balance at 30
Balance at 30
June 2021
June 2021
June 2021
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-21
9-Mar-20
9-Mar-20
9-Mar-20
1-Jul-20
1-Jul-20
1-Jul-20
1-Jul-21
1-Jul-21
1-Jul-21
1-Jul-22
1-Jul-22
1-Jul-22
30-Jul-20
30-Jul-20
30-Jul-20
31-Jul-20
31-Jul-20
31-Jul-20
8-Sep-20
8-Sep-20
8-Sep-20
1-Jul-21
1-Jul-21
1-Jul-21
1-Jul-22
1-Jul-22
1-Jul-22
1-Jul-23
1-Jul-23
1-Jul-23
18-Sep-20
18-Sep-20
18-Sep-20
2-Oct-20
2-Oct-20
2-Oct-20
1-Jul-21
1-Jul-21
1-Jul-21
1-Jul-22
1-Jul-22
1-Jul-22
1-Jul-23
1-Jul-23
1-Jul-23
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
31-Jul-22
31-Jul-22
31-Jul-22
31-Jul-22
31-Jul-22
31-Jul-22
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
31-Jul-22
31-Jul-22
31-Jul-22
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-25
30-Jun-22
30-Jun-22
30-Jun-22
30-Jun-23
30-Jun-23
30-Jun-23
17-Dec-19
17-Dec-19
17-Dec-19
17-Dec-19
17-Dec-19
17-Dec-19
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
9-Mar-20
30-Jul-20
30-Jul-20
30-Jul-20
31-Jul-20
31-Jul-20
31-Jul-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
8-Sep-20
18-Sep-20
18-Sep-20
18-Sep-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
2-Oct-20
17-Dec-20
17-Dec-20
17-Dec-20
17-Dec-20
17-Dec-20
17-Dec-20
$0.275
$0.275
$0.275
$0.275
$0.275
$0.275
$0.082
$0.082
$0.082
$0.082
$0.082
$0.082
$0.082
$0.082
$0.082
$0.082
$0.082
$0.082
$0.033
$0.033
$0.033
$0.029
$0.029
$0.029
$0.272
$0.272
$0.272
$0.272
$0.272
$0.272
$0.272
$0.272
$0.272
$0.272
$0.272
$0.272
$0.204
$0.204
$0.204
$0.262
$0.262
$0.262
$0.262
$0.262
$0.262
$0.262
$0.262
$0.262
$0.262
$0.262
$0.262
$0.255
$0.255
$0.255
$0.255
$0.255
$0.255
250,000
250,000
250,000
150,000
150,000
150,000
136,578
136,578
136,578
136,552
136,552
136,552
131,087
131,087
131,087
131,098
131,098
131,098
5,776,859
5,776,859
5,776,859
8,847,325
8,847,325
8,847,325
171,566
171,566
171,566
161,055
161,055
161,055
161,055
161,055
161,055
161,061
161,061
161,061
4,666,666
4,666,666
4,666,666
128,439
128,439
128,439
142,498
142,498
142,498
142,498
142,498
142,498
142,502
142,502
142,502
250,000
250,000
250,000
250,000
250,000
250,000
Balance at
Balance at
Balance at
Date of this
Date of this
Date of this
Report
Report
Report
250,000
250,000
250,000
150,000
150,000
150,000
136,578
136,578
136,578
136,552
136,552
136,552
131,087
131,087
131,087
131,098
131,098
131,098
5,450,090
5,450,090
5,450,090
8,847,325
8,847,325
8,847,325
171,566
171,566
171,566
161,055
161,055
161,055
161,055
161,055
161,055
161,061
161,061
161,061
4,666,666
4,666,666
4,666,666
128,439
128,439
128,439
142,498
142,498
142,498
142,498
142,498
142,498
142,502
142,502
142,502
250,000
250,000
250,000
250,000
250,000
250,000
(i) On 17 December 2019, 800,000 Performance Rights were issued to Directors under the LTIP, and subsequently 250,000 and 150,000 were
(i) On 17 December 2019, 800,000 Performance Rights were issued to Directors under the LTIP, and subsequently 250,000 and 150,000 were
(i) On 17 December 2019, 800,000 Performance Rights were issued to Directors under the LTIP, and subsequently 250,000 and 150,000 were
exercised on 6 November 2020 and 17 December 2020 respectively.
exercised on 6 November 2020 and 17 December 2020 respectively.
exercised on 6 November 2020 and 17 December 2020 respectively.
(ii) On 9 March 2020, 785,127 options were issued to employees under the LTIP, and subsequently 155,995 were forfeited due to failure to meet
(ii) On 9 March 2020, 785,127 options were issued to employees under the LTIP, and subsequently 155,995 were forfeited due to failure to meet
(ii) On 9 March 2020, 785,127 options were issued to employees under the LTIP, and subsequently 155,995 were forfeited due to failure to meet
vesting conditions and 93,817 lapsed after not being exercised within 60 days of cessation of employment. These options vest subject to time-
vesting conditions and 93,817 lapsed after not being exercised within 60 days of cessation of employment. These options vest subject to time-
vesting conditions and 93,817 lapsed after not being exercised within 60 days of cessation of employment. These options vest subject to time-
based and performance-based vesting conditions, including the employee remaining in the employ of the consolidated entity during the
based and performance-based vesting conditions, including the employee remaining in the employ of the consolidated entity during the
based and performance-based vesting conditions, including the employee remaining in the employ of the consolidated entity during the
performance period and satisfaction of individual KPI's.
performance period and satisfaction of individual KPI's.
performance period and satisfaction of individual KPI's.
(iii) On 30 July 2020, 8,847,531 Attaching Options were issued under the Entitlement Offer as announced by the consolidated entity on 6 July
(iii) On 30 July 2020, 8,847,531 Attaching Options were issued under the Entitlement Offer as announced by the consolidated entity on 6 July
(iii) On 30 July 2020, 8,847,531 Attaching Options were issued under the Entitlement Offer as announced by the consolidated entity on 6 July
2020, and subsequently 3,397,441 were exercised.
2020, and subsequently 3,397,441 were exercised.
2020, and subsequently 3,397,441 were exercised.
(iv) On 31 July 2020, 11,847,325 Attaching Options were issued to underwriters under the Entitlement Offer as announced by the consolidated
(iv) On 31 July 2020, 11,847,325 Attaching Options were issued to underwriters under the Entitlement Offer as announced by the consolidated
(iv) On 31 July 2020, 11,847,325 Attaching Options were issued to underwriters under the Entitlement Offer as announced by the consolidated
entity on 6 July 2020, and subsequently 3,000,000 were exercised.
entity on 6 July 2020, and subsequently 3,000,000 were exercised.
entity on 6 July 2020, and subsequently 3,000,000 were exercised.
(v) On 8 September 2020, 878,038 options were issued to employees under the LTIP, and subsequently 7,813 were exercised, 175,349 were
(v) On 8 September 2020, 878,038 options were issued to employees under the LTIP, and subsequently 7,813 were exercised, 175,349 were
(v) On 8 September 2020, 878,038 options were issued to employees under the LTIP, and subsequently 7,813 were exercised, 175,349 were
forfeited due to failure to meet vesting conditions and 40,139 lapsed after not being exercised within 60 days of cessation of employment. These
forfeited due to failure to meet vesting conditions and 40,139 lapsed after not being exercised within 60 days of cessation of employment. These
forfeited due to failure to meet vesting conditions and 40,139 lapsed after not being exercised within 60 days of cessation of employment. These
including the employee remaining in the employ of the
options vest subject to time-based and performance-based vesting conditions,
including the employee remaining in the employ of the
options vest subject to time-based and performance-based vesting conditions,
including the employee remaining in the employ of the
options vest subject to time-based and performance-based vesting conditions,
consolidated entity during the performance period and satisfaction of individual KPI's.
consolidated entity during the performance period and satisfaction of individual KPI's.
consolidated entity during the performance period and satisfaction of individual KPI's.
(vi) On 31 July 2020, 4,666,666 Attaching Options were issued under the Placement Offer as announced by the consolidated entity on 6 July 2020.
(vi) On 31 July 2020, 4,666,666 Attaching Options were issued under the Placement Offer as announced by the consolidated entity on 6 July 2020.
(vi) On 31 July 2020, 4,666,666 Attaching Options were issued under the Placement Offer as announced by the consolidated entity on 6 July 2020.
(vii) On 2 October 2020, 582,500 options were issued to employees under the LTIP, and subsequently 26,563 were exercised during the year
(vii) On 2 October 2020, 582,500 options were issued to employees under the LTIP, and subsequently 26,563 were exercised during the year
(vii) On 2 October 2020, 582,500 options were issued to employees under the LTIP, and subsequently 26,563 were exercised during the year
ended 30 June 2021. These options vest subject to time-based and performance-based vesting conditions, including the employee remaining in
ended 30 June 2021. These options vest subject to time-based and performance-based vesting conditions, including the employee remaining in
ended 30 June 2021. These options vest subject to time-based and performance-based vesting conditions, including the employee remaining in
the employ of the consolidated entity during the performance period and satisfaction of individual KPI's.
the employ of the consolidated entity during the performance period and satisfaction of individual KPI's.
the employ of the consolidated entity during the performance period and satisfaction of individual KPI's.
(viii) On 17 December 2020, 500,000 Performance Rights were issued to Directors under the LTIP.
(viii) On 17 December 2020, 500,000 Performance Rights were issued to Directors under the LTIP.
(viii) On 17 December 2020, 500,000 Performance Rights were issued to Directors under the LTIP.
Option holders do not have any right, by virtue of the option, to participate in any share issue of the company or any related entity or in the
Option holders do not have any right, by virtue of the option, to participate in any share issue of the company or any related entity or in the
Option holders do not have any right, by virtue of the option, to participate in any share issue of the company or any related entity or in the
interest issue of any other registered scheme. For details of options issued to directors and executives as remuneration, refer to the
interest issue of any other registered scheme. For details of options issued to directors and executives as remuneration, refer to the
interest issue of any other registered scheme. For details of options issued to directors and executives as remuneration, refer to the
Remuneration Report.
Remuneration Report.
Remuneration Report.
32
33
15
16
16
16
Hydrix annual report 2021 Hydrix annual report 2021
Directors'
report
Hydrix Limited
Directors' Report
30 June 2021
Indemnity and insurance of officers
The company has indemnified the directors and executives of the consolidated entity for costs incurred, in their capacity as a director or
executive, for which they may be held personally liable, except where there is a lack of good faith.
During the financial year, the consolidated entity paid a premium in respect of a contract to insure the directors and executives of the company
against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability
and the amount of the premium.
Auditor's independence
declaration
Indemnity and insurance of auditor
To the extent permitted by law, the company has agreed to indemnify its auditors, Grant Thornton Audit Pty Ltd, as part of the terms of its audit
engagement agreement against claims made by third parties arising from the audit (for an unspecified amount). No payment has been made to
indemnify Grant Thornton Audit Pty Ltd during or since end of the financial year.
The company has not otherwise, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the consolidated
entity or any related entity against a liability incurred by the auditor.
Proceedings on behalf of the company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf of the company or to
intervene in any proceedings to which the company is a party, for the purpose of taking responsibility on behalf of the company for all or part of
those proceedings.
Non-audit services
Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor are outlined in note
26 to the financial statements.
The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another person or firm on the
auditor's behalf), is compatible with the general standard of independence for auditors imposed by the Corporations Act 2001.
The directors are of the opinion that the services as disclosed in note 26 to the financial statements do not compromise the external auditor's
independence requirements of the Corporations Act 2001 for the following reasons:
- all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity of the auditor; and
- none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional
Accountants issued by the Accounting Professional and Ethical Standards Board, including reviewing or auditing the auditor's own work, acting in
a management or decision-making capacity for the company, acting as advocate for the company or jointly sharing economic risks and rewards.
Rounding of amounts
The company is of a kind referred to in Corporations Instrument 2016/191,
relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that Corporations Instrument to the nearest dollar.
issued by the Australian Securities and Investments Commission,
Auditor’s Independence Declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 is set out immediately after this
directors' report.
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001.
On behalf of the directors
Mr Gavin Coote
Executive Chairman
31-August-2021
Melbourne
34
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35
Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389 ‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited. Liability limited by a scheme approved under Professional Standards Legislation. www.grantthornton.com.au Collins Square, Tower 5 727 Collins Street Melbourne VIC 3008 Correspondence to: GPO Box 4736 Melbourne VIC 3001 T +61 3 8320 2222 E info.vic@au.gt.com W www.grantthornton.com.au Auditor’s Independence Declaration To the Directors of Hydrix Limited In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Hydrix Limited for the year ended 30 June 2021, I declare that, to the best of my knowledge and belief, there have been: a no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and b no contraventions of any applicable code of professional conduct in relation to the audit. Grant Thornton Audit Pty Ltd Chartered Accountants A C Pitts Partner – Audit & Assurance Melbourne, 31 August 2021 Hydrix annual report 2021 Hydrix annual report 2021
Consolidated statement
of profit & loss and other comprehensive income
Hydrix Limited
Hydrix Limited
year ended 30 June 2021
Consolidated Statement of Profit & Loss and Other Comprehensive Income
Consolidated Statement of Profit & Loss and Other Comprehensive Income
For the year ended 30 June 2021
For the year ended 30 June 2021
Revenue
Revenue
Interest income
Revenue
Revenue
Interest income
Operating expenses
Operating expenses
Employee benefits expense
Employee benefits expense
Project material expenses
Project material expenses
Cost of sales
Cost of sales
Depreciation and amortisation expense
Depreciation and amortisation expense
Finance costs
Finance costs
Rental expense
Rental expense
Selling, advertising and distribution expenses
Selling, advertising and distribution expenses
Research and development expenses
Research and development expenses
Other expenses
Other expenses
Share based payment expenses
Share based payment expenses
Impairment of goodwill
Impairment of goodwill
Impairment of receivables
Impairment of receivables
Gain/(Loss) on financial instruments at fair value through profit or loss
Gain/(Loss) on financial instruments at fair value through profit or loss
Gain/(Loss) on contingent consideration liability
Gain/(Loss) on contingent consideration liability
Impairment of plant and equipment
Impairment of plant and equipment
Debt extinguishment loss
Debt extinguishment loss
Unrealised foreign exchange Gain/(Loss)
Unrealised foreign exchange Gain/(Loss)
Note
Note
2021
2021
$
$
2020
2020
$
$
4
4
5
5
5
5
5
5
5
31
5
31
8
5
8
5
9
9
9,296,410
9,296,410
15,328
15,328
9,311,738
9,311,738
15,887,868
15,887,868
11,875
11,875
15,899,742
15,899,742
(9,654,553)
(9,654,553)
(1,766,079)
(1,766,079)
(38,896)
(38,896)
(2,446,900)
(2,446,900)
(1,110,082)
(1,110,082)
46,378
46,378
(208,041)
(208,041)
-
-
(1,970,840)
(1,970,840)
(426,771)
(426,771)
(1,269,400)
(1,269,400)
94,602
94,602
(69,825)
(69,825)
(190,486)
(190,486)
-
-
-
-
(79,537)
(79,537)
(19,090,431)
(19,090,431)
-
(11,617,956)
(11,617,956)
(1,576,638)
(1,576,638)
-
(1,160,581)
(1,160,581)
(1,304,961)
(1,304,961)
(160,505)
(160,505)
(362,918)
(362,918)
162,763
162,763
(2,292,113)
(2,292,113)
(183,484)
(183,484)
-
-
(133,091)
(133,091)
927,303
927,303
(85,994)
(85,994)
(201,652)
(201,652)
(1,063,586)
(1,063,586)
280,938
280,938
(18,772,476)
(18,772,476)
Loss before income tax expense
Loss before income tax expense
(9,778,693)
(9,778,693)
(2,872,734)
(2,872,734)
Income tax (expense)/ benefit
Income tax (expense)/ benefit
6
6
-
-
(346,727)
(346,727)
Loss after income tax expense
Loss after income tax expense
(9,778,693)
(9,778,693)
(3,219,461)
(3,219,461)
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss:
Movement in functional currency of foreign operations
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss:
Movement in functional currency of foreign operations
21
21
(1,909)
(1,909)
-
-
Total comprehensive loss for year attributable to the Owners of Hydrix
Limited
Total comprehensive loss for year attributable to the Owners of Hydrix
Limited
(9,780,602)
(9,780,602)
(3,219,461)
(3,219,461)
Loss per share
Basic and diluted earnings per share (cents per share)
Loss per share
Basic and diluted earnings per share (cents per share)
30
30
$
$
Cents
(6.84)
Cents
(6.84)
Cents
(4.35)
Cents
(4.35)
$
$
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
Hydrix Limited
Hydrix Limited
Hydrix Limited
Consolidated Statement of Financial Position
Consolidated Statement of Financial Position
Consolidated Statement of Financial Position
As at 30 June 2021
As at 30 June 2021
As at 30 June 2021
Current assets
Current assets
Current assets
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents
Trade and other receivables
Trade and other receivables
Trade and other receivables
Contract assets
Contract assets
Contract assets
Prepayments
Prepayments
Prepayments
Inventory
Inventory
Inventory
Total current assets
Total current assets
Total current assets
Non-current assets
Non-current assets
Non-current assets
Financial assets at fair value through profit & loss
Financial assets at fair value through profit & loss
Financial assets at fair value through profit & loss
Plant and equipment
Plant and equipment
Plant and equipment
Right of use assets
Right of use assets
Right of use assets
Intangible assets
Intangible assets
Intangible assets
Other assets
Other assets
Other assets
Security deposits
Security deposits
Security deposits
Total non-current assets
Total non-current assets
Total non-current assets
Total Assets
Total Assets
Total Assets
Current liabilities
Current liabilities
Current liabilities
Trade and other payables
Trade and other payables
Trade and other payables
Contract liabilities
Contract liabilities
Contract liabilities
Borrowings
Borrowings
Borrowings
Derivative liabilities
Derivative liabilities
Derivative liabilities
Employee benefits
Employee benefits
Employee benefits
Lease liabilities C
Lease liabilities C
Lease liabilities C
Other liabilities
Other liabilities
Other liabilities
Total current Liabilities
Total current Liabilities
Total current Liabilities
Non-current liabilities
Non-current liabilities
Non-current liabilities
Borrowings NC
Borrowings NC
Borrowings NC
Employee benefits'
Employee benefits'
Employee benefits'
Lease liabilities NC
Lease liabilities NC
Lease liabilities NC
Provisions'
Provisions'
Provisions'
Other liabilities (NC)
Other liabilities (NC)
Other liabilities (NC)
Total non-Current Liabilities
Total non-Current Liabilities
Total non-Current Liabilities
Total Liabilities
Total Liabilities
Total Liabilities
Net Assets
Net Assets
Net Assets
Equity
Equity
Equity
Issued capital
Issued capital
Issued capital
Reserves
Reserves
Reserves
Accumulated losses
Accumulated losses
Accumulated losses
Total Equity
Total Equity
Total Equity
Consolidated statement
of financial position
as at 30 June 2021
Note
Note
Note
2021
2021
2021
$
$
$
2020
2020
2020
$
$
$
7
7
7
8
8
8
13
13
13
11
11
11
9
9
9
19
19
19
10
10
10
12
12
12
13
13
13
17
17
17
18
18
18
15
15
15
19
19
19
14
14
14
17
17
17
15
15
15
19
19
19
16
16
16
14
14
14
20
20
20
21
21
21
22
22
22
6,647,225
6,647,225
6,647,225
574,504
574,504
574,504
1,090,544
1,090,544
1,090,544
178,482
178,482
178,482
11,281
11,281
11,281
8,502,036
8,502,036
8,502,036
1,690,194
1,690,194
1,690,194
3,088,210
3,088,210
3,088,210
681,832
681,832
681,832
140,278
140,278
140,278
-
-
-
5,600,514
5,600,514
5,600,514
2,847,102
2,847,102
2,847,102
454,604
454,604
454,604
2,076,561
2,076,561
2,076,561
4,985,965
4,985,965
4,985,965
87,602
87,602
87,602
424,980
424,980
424,980
10,876,814
10,876,814
10,876,814
2,234,704
2,234,704
2,234,704
328,031
328,031
328,031
2,538,019
2,538,019
2,538,019
7,875,857
7,875,857
7,875,857
20,768
20,768
20,768
424,980
424,980
424,980
13,422,359
13,422,359
13,422,359
19,378,850
19,378,850
19,378,850
19,022,873
19,022,873
19,022,873
1,529,393
1,529,393
1,529,393
1,601,717
1,601,717
1,601,717
1,000,000
1,000,000
1,000,000
770,910
770,910
770,910
902,302
902,302
902,302
637,184
637,184
637,184
2,499,687
2,499,687
2,499,687
8,941,193
8,941,193
8,941,193
1,250,000
1,250,000
1,250,000
201,863
201,863
201,863
3,086,770
3,086,770
3,086,770
189,371
189,371
189,371
-
-
-
4,728,004
4,728,004
4,728,004
1,247,101
1,247,101
1,247,101
1,291,008
1,291,008
1,291,008
276,664
276,664
276,664
450,782
450,782
450,782
734,011
734,011
734,011
507,294
507,294
507,294
120,000
120,000
120,000
4,626,860
4,626,860
4,626,860
5,742,597
5,742,597
5,742,597
248,931
248,931
248,931
3,393,824
3,393,824
3,393,824
190,209
190,209
190,209
2,524,482
2,524,482
2,524,482
12,100,043
12,100,043
12,100,043
13,669,197
13,669,197
13,669,197
16,726,903
16,726,903
16,726,903
5,709,653
5,709,653
5,709,653
2,295,970
2,295,970
2,295,970
95,402,178
95,402,178
95,402,178
1,772,905
1,772,905
1,772,905
(91,465,430)
(91,465,430)
(91,465,430)
5,709,653
5,709,653
5,709,653
82,506,939
82,506,939
82,506,939
1,814,874
1,814,874
1,814,874
(82,025,843)
(82,025,843)
(82,025,843)
2,295,970
2,295,970
2,295,970
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction
with the accompanying notes
The above consolidated statement of financial position should be read in conjunction
with the accompanying notes
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
36
19
19
20
20
20
37
Hydrix annual report 2021 Hydrix annual report 2021
Consolidated statement
of changes in equity
year ended 30 June 2021
Hydrix Limited
Consolidated Statement of Changes in Equity
For the year ended 30 June 2021
Hydrix Limited
Consolidated Statement of Changes in Equity
For the year ended 30 June 2021
Consolidated
Consolidated
Issued
Issued
Capital
Capital
$
$
Reserves
Reserves
$
$
Accumulated
Accumulated
Losses
Losses
$
$
Total
$
Total
$
Balance at 1 July 2019
Balance at 1 July 2019
79,276,500
79,276,500
810,437
810,437
(78,950,429)
(78,950,429)
1,136,508
1,136,508
Reclassification of financial assets
Reclassification of financial assets
-
-
31,529
31,529
(31,529)
(31,529)
-
-
Loss after income tax expense for the year
Other comprehensive income, net of tax
Total comprehensive income for the year
Loss after income tax expense for the year
Other comprehensive income, net of tax
Total comprehensive income for the year
-
-
-
-
-
-
-
-
-
-
-
-
(3,219,461)
(3,219,461)
-
-
(3,219,461)
(3,219,461)
(3,219,461)
(3,219,461)
-
-
(3,219,461)
(3,219,461)
Transactions with owners in their capacity as owners:
Share based payments
Exercised options / performance rights
Expired options
Contributions of equity, net of transaction costs
Contingent equity consideration
Transactions with owners in their capacity as owners:
Share based payments
Exercised options / performance rights
Expired options
Contributions of equity, net of transaction costs
Contingent equity consideration
-
-
355,000
355,000
-
-
2,875,439
2,875,439
-
-
183,484
183,484
(355,000)
(355,000)
(175,576)
(175,576)
-
-
1,320,000
1,320,000
-
-
-
-
175,576
175,576
-
-
-
-
183,484
183,484
-
-
-
-
2,875,439
2,875,439
1,320,000
1,320,000
Balance at 30 June 2020
Balance at 30 June 2020
82,506,939
82,506,939
1,814,874
1,814,874
(82,025,843)
(82,025,843)
2,295,970
2,295,970
Consolidated
Consolidated
Issued
Issued
Capital
Capital
$
$
Reserves
Reserves
$
$
Accumulated
Accumulated
Losses
Losses
$
$
Total
$
Total
$
Balance at 1 July 2020
Balance at 1 July 2020
82,506,939
82,506,939
1,814,874
1,814,874
(82,025,843)
(82,025,843)
2,295,970
2,295,970
Loss after income tax expense for the year
Other comprehensive income, net of tax
Total comprehensive income for the year
Loss after income tax expense for the year
Other comprehensive income, net of tax
Total comprehensive income for the year
-
-
-
-
-
-
-
-
(1,909)
(1,909)
(1,909)
(1,909)
(9,778,693)
(9,778,693)
-
-
(9,778,693)
(9,778,693)
(9,778,693)
(9,778,693)
(1,909)
(1,909)
(9,780,602)
(9,780,602)
Transactions with owners in their capacity as owners:
Share based payments
Exercised options / performance rights
Expired options
Contributions of equity, net of transaction costs
Transactions with owners in their capacity as owners:
Share based payments
Exercised options / performance rights
Expired options
Contributions of equity, net of transaction costs
-
-
130,303
130,303
-
-
12,764,936
12,764,936
426,771
426,771
(136,814)
(136,814)
(330,017)
(330,017)
-
-
-
-
9,089
9,089
330,017
330,017
-
-
426,771
426,771
2,578
2,578
-
-
12,764,936
12,764,936
Consolidated statement
of cash flows
year ended 30 June 2021
Hydrix Limited
Consolidated Statement of Cash Flows
For the year ended 30 June 2021
Hydrix Limited
Consolidated Statement of Cash Flows
For the year ended 30 June 2021
Cash Flows from operating activities
Cash Flows from operating activities
Receipts from customers (including GST)
Receipts from customers (including GST)
Payments to suppliers and employees (including GST)
Payments to suppliers and employees (including GST)
Receipt of government grants
Receipt of government grants
Income tax receipt (R&D tax incentive)
Income tax receipt (R&D tax incentive)
Net cash used in operating activities
Net cash used in operating activities
Cash Flows from Investing Activities
Payments for plant and equipment
Payments for intangible assets
Payments for investments
Cash Flows from Investing Activities
Payments for plant and equipment
Payments for intangible assets
Payments for investments
Net cash used in investing activities
Net cash used in investing activities
Cash Flows from financing activities
Cash Flows from financing activities
Proceeds from issue of shares
Proceeds from issue of shares
Share issue transaction costs paid
Share issue transaction costs paid
Proceeds from borrowings
Proceeds from borrowings
Borrowing transaction costs paid
Borrowing transaction costs paid
Repayments of borrowings
Repayments of borrowings
Interest received
Interest received
Interest and other finance costs paid
Interest and other finance costs paid
Repayments of lease liabilities
Repayments of lease liabilities
Note
Note
2021
$
2021
$
2020
$
2020
$
9,883,931
(13,650,460)
1,716,151
117,133
9,883,931
(13,650,460)
1,716,151
117,133
16,812,408
(17,749,255)
477,500
262,393
16,812,408
(17,749,255)
477,500
262,393
23
9
10
(1,933,245)
23
(1,933,245)
(196,954)
(196,954)
(239,839)
9
(251,684)
10
(150,040)
(641,563)
(239,839)
(251,684)
(150,040)
(42,610)
(12,362)
(1,012,510)
(42,610)
(12,362)
(1,012,510)
(641,563)
(1,067,482)
(1,067,482)
13,718,757
2,567,700
13,718,757
(209,462)
(986,726)
(986,726)
-
5,678,235
-
(120,000)
-
-
(3,632,016)
(4,026,664)
(4,026,664)
11,875
15,328
15,328
(1,131,485)
(943,605)
(943,605)
(444,844)
(245,226)
(245,226)
2,567,700
(209,462)
5,678,235
(120,000)
(3,632,016)
11,875
(1,131,485)
(444,844)
Net cash flow from financing activities
Net cash flow from financing activities
7,531,864
7,531,864
2,720,003
2,720,003
Net increase in cash and cash equivalents
Net increase in cash and cash equivalents
4,957,056
4,957,056
1,455,567
1,455,567
Cash and cash equivalents at start of year
Cash and cash equivalents at start of year
Effects of exchange rate changes on cash and cash equivalents
Effects of exchange rate changes on cash and cash equivalents
1,690,194
(25)
1,690,194
(25)
234,627
-
234,627
-
Cash and cash equivalents at end of year
Cash and cash equivalents at end of year
7
6,647,225
7
6,647,225
1,690,194
1,690,194
Balance at 30 June 2021
Balance at 30 June 2021
95,402,178
95,402,178
1,772,905
1,772,905
(91,465,430)
(91,465,430)
5,709,653
5,709,653
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
38
22
22
39
21
21
Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
1 General Information
The financial statements cover Hydrix Limited as a consolidated entity consisting of Hydrix Limited and the entities it controlled at the end of, or
during, the year. The financial statements are presented in Australian dollars, which is Hydrix Limited's functional and presentation currency.
Hydrix Limited is a company limited by shares and incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange.
A description of the nature of the consolidated entity's operations and its principal activities are included in the directors' report, which is not part
of the financial statements.
The financial statements were authorised for issue by the directors of the company on 31 August 2021.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
Accordingly, the directors believe the consolidated entity will continue as a going concern and it is appropriate to adopt the going concern basis in
the preparation of the financial report.
The financial statements do not include any adjustments relating to amounts or classification of recorded assets or liabilities that might be
necessary should the consolidated entity not be able to continue as a going concern.
b) Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the consolidated entity only. Supplementary
information about the parent entity is disclosed in note 28.
a) Basis of Preparation
c) Principles of consolidation
The financial statements are general purpose financial statements that have been prepared in accordance with Australian Accounting Standards,
Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board (AASB) and the
Corporations Act 2001. The Company is a for-profit entity for financial reporting purposes under the Australian Accounting Standards.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in financial statements containing relevant
and reliable information about transactions, events and conditions. Compliance with Australian Accounting Standards ensures that the financial
statements and notes also comply with International Financial Reporting Standards as issued by the IASB. Material accounting policies adopted in
the preparation of the financial statements are presented below and have been consistently applied unless stated otherwise.
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where applicable, the revaluation of financial assets
and derivatives.
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its
judgement in the process of applying the consolidated entity's accounting policies. The areas involving a higher degree of judgement or complexity,
or areas where assumptions and estimates are significant to financial statements are disclosed in note 2.
Going concern
The financial statements have been prepared on the going concern basis, which contemplates continuity of normal business activities and the
realisation of assets and discharge of liabilities in the ordinary course of business.
For the year ended 30 June 2021, the consolidated entity incurred a net loss before tax of $9,778,693, reported cash used in operations of
$1,933,245 and had a net current assets deficit (current assets less current liabilities) of $439,157. Subsequent to balance date, Victoria (the
consolidated entity’s principal place of business) and Australia more broadly, continued to be significantly disrupted by COVID-19 outbreaks
impacting upon near term revenue generation of product development services and commencing distribution of the consolidated entity’s
cardiovascular technologies.
The above factors create business uncertainty which may cast doubt over the business continuing as a going concern and whether the consolidated
entity will be able to realise its assets and extinguish its liabilities in the normal course of business at the amounts stated in the financial report.
Despite these business uncertainties, the directors are of the opinion the consolidated entity will continue as a going concern, taking into
consideration various factors including:
- The consolidated entity had an available cash balance of $6,647,225 at 30 June 2021;
- The consolidated entity, at 30 June 2021, had 19,290,850 in-the-money listed $0.12 cents HYDO options expiring 31 July 2022 which if exercised,
will provide additional cash of $2,314,902;
- Subsequent to the end of the financial year, the consolidated entity deferred the March 2022 maturity of the $1,000,000 unsecured shareholder
loan to 31 December 2022 (refer Note 17);
- Based on anticipated timing of milestone achievements, the directors believe the consolidated entity will not be required to pay the second
tranche of USD$1,000,000 of the contingent consideration liability during the next 12 months (refer Note 14);
- The derivative liability is treated as current in the financial statements based on the warrants issued to Pure Asset Management (PAM) being
exercisable any time before the expiration date of 17 December 2023. In the event PAM fully exercises the warrants, the consolidated entity would
receive approximately $2,384,036 cash inflow;
- A budget and cash flow forecast for the 12 month period from the date of signing of the financial statements, which supports the directors'
assertion, has been prepared based on assumptions about certain economic, operating and trading performance achievement contingent on
future events and actions yet to occur, and which may not necessarily occur. Should the need arise, there are operating costs of the business that
will be reduced if required. Whilst the directors believe the assumptions are best estimate assumptions based upon information available, the
occurrence and timing of future events are not certain. The directors will continually monitor the operating performance against the budget and
cash flow forecast; and
- The directors believe the consolidated entity would be able to raise additional capital if required to support strategic growth initiatives and
working capital.
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Hydrix Limited ('company' or 'parent entity') as at
30 June 2021 and the results of all subsidiaries for the year then ended. Hydrix Limited and its subsidiaries together are referred to in these
financial statements as the 'consolidated entity'.
Subsidiaries are all those entities over which the consolidated entity has control. The consolidated entity controls an entity when the consolidated
entity is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its
power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the consolidated
entity. They are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the consolidated entity are eliminated. Unrealised
losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with the policies adopted by the consolidated entity.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest, without the loss of
control, is accounted for as an equity transaction, where the difference between the consideration transferred and the book value of the share of
the non-controlling interest acquired is recognised directly in equity attributable to the parent.
d) Foreign currency translation
The financial statements are presented in Australian dollars, which is Hydrix Limited's functional and presentation currency. Foreign currency
transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains
and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in profit or loss.
e) Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the company's normal operating
cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the reporting period; or the asset is cash or
cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period. All other assets
are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the company's normal operating cycle; it is held primarily for the
purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no unconditional right to defer the settlement of
the liability for at least 12 months after the reporting period. All other liabilities are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
f)
Impairment of assets
At the end of each reporting period, the consolidated entity assesses whether there is any indication that an asset may be impaired. The
assessment will include the consideration of external and internal sources of information including dividends received from subsidiaries, associates
or jointly controlled entities deemed to be out of pre-acquisition profits. If such an indication exists, an impairment test is carried out on the asset
by comparing the recoverable amount of the asset, being the higher of the asset’s fair value less costs of disposal and value in use, to the asset’s
carrying amount. Any excess of the asset’s carrying amount over its recoverable amount is recognised immediately in profit or loss.
Where it is not possible to estimate the recoverable amount of an individual asset, the consolidated entity estimates the recoverable amount of
the cash-generating unit to which the asset belongs.
40
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41
Hydrix annual report 2021 Hydrix annual report 2021 Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
g) Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the tax
authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to,
the tax authority is included in other receivables or other payables in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable
from, or payable to the tax authority, are presented as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority.
h) Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any
allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days.
The consolidated entity has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance. To
measure the expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
i) Contract assets
Contract assets are recognised when the consolidated entity has transferred goods or services to the customer but where an unconditional right to
consideration is yet to be established, less any allowance for expected credit losses.
j)
Investments and other financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial measurement, except
for financial assets at fair value through profit or loss. Such assets are subsequently measured at either amortised cost or fair value depending on
their classification. Classification is determined based on both the business model within which such assets are held and the contractual cash flow
characteristics of the financial asset, unless an accounting mismatch is being avoided.
Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the consolidated entity has
transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of recovering part or all of a financial
asset, its carrying value is written off.
Financial assets at fair value through profit or loss
Financial assets not measured at amortised cost or at fair value through other comprehensive income are classified as financial assets at fair value
through profit or loss. Typically, such financial assets will be either: (i) held for trading, where they are acquired for the purpose of selling in the
short-term with an intention of making a profit, or a derivative; or (ii) designated as such upon initial recognition where permitted. Fair value
movements are recognised in profit or loss.
Financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income include equity investments which the consolidated entity intends to hold for the
foreseeable future and has irrevocably elected to classify them as such upon initial recognition.
Impairment of financial assets
The consolidated entity recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised cost or
fair value through other comprehensive income. The measurement of the loss allowance depends upon the consolidated entity's assessment at the
end of each reporting period as to whether the financial instrument's credit risk has increased significantly since initial recognition, based on
reasonable and supportable information that is available, without undue cost or effort to obtain.
Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit loss allowance is
estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a default event that is possible within the
next 12 months. Where a financial asset has become credit impaired or where it is determined that credit risk has increased significantly, the loss
allowance is based on the asset's lifetime expected credit losses. The amount of expected credit loss recognised is measured on the basis of the
probability weighted present value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.
For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within other comprehensive
income. In all other cases, the loss allowance is recognised in profit or loss.
k) Contract liabilities
Contract liabilities represent the consolidated entity's performance obligation with respect to the transfer of goods or services to a customer and
are recognised when a customer pays consideration before the consolidated entity has transferred the goods or services to the customer.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
l) Financial liabilities
The consolidated entity’s financial liabilities include borrowings, trade and other payables and derivative financial instruments. Financial liabilities
are initially measured at fair value, and, where applicable, adjusted for transaction costs unless the Group designated a financial liability at fair
value through profit or loss.
Subsequently, financial liabilities are measured at amortised cost using the effective interest method except for derivatives and financial liabilities
designated at FVTPL, which are carried subsequently at fair value with gains or losses recognised in profit or loss (other than derivative financial
instruments that are designated and effective as hedging instruments).
All interest-related charges are included within finance costs or finance income.
m) Fair value measurement of financial instruments
The consolidated entity is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy, based on the lowest
level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical
assets or liabilities that the entity can access at the measurement date; Level 2: Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly or indirectly; and Level 3: Unobservable inputs for the asset or liability. Considerable judgement
is required to determine what is significant to fair value and therefore which category the asset or liability is placed in can be subjective.
The fair value of assets and liabilities classified as level 2 and level 3 are determined by the use of valuation models. These include discounted cash
flow analysis or the use of observable inputs that require significant adjustments based on unobservable inputs.
The following table shows the levels within the hierarchy of financial assets and liabilities measured at fair value on a recurring basis at 30 June
2021 and 30 June 2020.
30 June 2021
Financial assets
Listed securities
Investment in Angel Medical Systems, Inc.
Investment in Cyban Pty Ltd
Investment in Gyder Surgical Pty Ltd
Gyder Surgical Pty Ltd convertible note
Total financial assets recognised at fair value
Financial liabilities
Embedded derivative liability
Total financial liabilities recognised at fair value
30 June 2020
Financial assets
Listed securities
Investment in Angel Medical Systems, Inc.
Investment in Cyban Pty Ltd
Investment in Gyder Surgical Pty Ltd
Total financial assets recognised at fair value
Financial liabilities
Embedded derivative liability
Total financial liabilities recognised at fair value
Level 1
$
Level 2
$
Level 3
$
Total
$
33,371
-
-
-
33,371
-
-
-
-
-
-
1,330,182
400,050
835,071
248,428
2,813,731
33,371
1,330,182
400,050
835,071
248,428
2,847,102
-
-
770,910
770,910
-
-
770,910
770,910
Level 1
$
Level 2
$
Level 3
$
Total
$
30,224
-
-
-
30,224
-
-
-
-
-
-
1,625,000
200,010
379,470
2,204,480
30,224
1,625,000
200,010
379,470
2,234,704
-
-
450,782
450,782
-
-
450,782
450,782
There were no transfers between Level 1, Level 2, and Level 3 during the twelve month period to 30 June 2021.
The valuation techniques used for instruments categorised in Levels 2, and 3 are described below:
Embedded derivative liability (Level 2)
A Black-Scholes model has been used as a valuation technique to value the embedded derivative liability.
Gyder Surgical Pty Ltd convertible note (Level 3)
Management determined the fair value of this investment by reference to the number of notes held and the face value of each note. Gyder
Surgical Pty Ltd is a private company and its valuation is less prone to fluctuations in response to economic and business developments or general
market sentiment as compared to a public company.
42
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43
Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
Investment in Gyder Surgical Pty Ltd (Level 3)
Management determined the fair value of this investment by reference to the issue price achieved during its last capital raise during September
2020. Gyder Surgical Pty Ltd is a private company and its valuation is less prone to fluctuations in response to economic and business
developments or general market sentiment as compared to a public company.
Investment in Cyban Pty Ltd (Level 3)
Management determined the fair value of this investment by reference to the issue price achieved during its last capital raise during April 2021.
Cyban Pty Ltd is a private company and its valuation is less prone to fluctuations in response to economic and business developments or general
market sentiment as compared to a public company.
Investment in Angel Medical Systems, Inc. (Level 3)
Management determined the fair value of the investment in Angel Medical Systems, Inc. based on unobservable inputs using the best information
available in the circumstances, which as Angel Medical Systems’ engineering partner included data and information gathered during the design,
engineering, and regulatory consulting services provided for the next generation of product upgrades. Management do not anticipate any change
in forecast performance of the next generation product.
Angel Medical Systems, Inc. is a private company and its valuation is less prone to fluctuations in response to economic and business developments
or general market sentiment as compared to a public company. However, as the investment in Angel Medical Systems, Inc. is held in USD it is
exposed to exchange rate risk.
n) New or amended Accounting Standards and Interpretations adopted
The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting
Standards Board ('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
The adoption of these Accounting Standards and interpretations did not have any significant impact on the financial performance or position of the
consolidated entity.
The following Accounting Standards and Interpretations are most relevant to the consolidated entity:
AASB 2020-4 Amendments to Australian Accounting Standards – COVID-19-Related Rent Concessions
The consolidated entity applied AASB 2020-4 for the first time from 1 July 2020. AASB 2020-4 makes amendments to AASB 16 Leases to provide a
practical expedient that permits lessees not to assess whether rent concessions that occur as a direct consequence of the COVID-19 pandemic and
meet specified conditions are lease modifications and, instead, to account for those rent concessions as if they were not lease modifications.
o) New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory, have not been early
adopted by the consolidated entity for the annual reporting period ended 30 June 2021. The consolidated entity's assessment of the impact of
these new or amended Accounting Standards and Interpretations, most relevant to the consolidated entity, are set out below.
2 Critical Accounting Estimates, Assumptions and Judgements
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported
amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent
liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various
factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting
judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are
discussed below.
Fair value measurement of non-cash consideration - revenue recognition
(i)
To determine the transaction price for contracts in which a customer promises consideration in a form other than cash, the consolidated entity
measures the non-cash consideration (or promise of non-cash consideration) at fair value on contract inception date. The fair value of non-cash
At the end of each reporting period, the consolidated entity updates the estimated transaction price (including updating its assessment of whether
an estimate of variable consideration is constrained) to represent faithfully the circumstances present at the end of the reporting period and the
changes in circumstances during the reporting period. The consolidated entity accounts for changes in the transaction price by recognising as
revenue, or as a reduction of revenue, amounts allocated to satisfied performance obligations, in the period in which the transaction price changes.
Share-based payment transactions
(ii)
The consolidated entity assesses the fair value of options granted applying the Black-Scholes valuation model. The use of this model requires
management to make assumptions regarding key inputs such as risk free rate, share price volatility and time to maturity.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
Impairment of goodwill and non-financial assets
(iii)
The consolidated entity tests annually, or more frequently if events or changes in circumstances indicate impairment, whether goodwill and other
non-financial assets have suffered any impairment. The recoverable amounts of cash-generating units have been determined based on value-in-
use calculations. These calculations require the use of assumptions, including estimated discount rates based on the current cost of capital and
growth rates of the estimated future cash flows.
Recovery of deferred tax assets
(iv)
Deferred tax assets are recognised for deductible temporary differences only if the consolidated entity considers it is probable that future taxable
amounts will be available to utilise those temporary differences and losses.
Employee benefits provision
(v)
The liability for employee benefits expected to be settled more than 12 months from the reporting date are recognised and measured at the
present value of the estimated future cash flows to be made in respect of all employees at the reporting date. In determining the present value of
the liability, estimates of attrition rates and pay increases through promotion and inflation have been taken into account.
Lease make-good provision
(vi)
A provision has been made for the present value of anticipated costs for future restoration of leased premises. The provision includes future cost
estimates associated with closure of the premises. The calculation of this provision requires assumptions such as application of closure dates and
cost estimates. The provision recognised for each site is periodically reviewed and updated based on the facts and circumstances available at the
time. Changes to the estimated future costs for sites are recognised in the statement of financial position by adjusting the asset and the provision.
Reductions in the provision that exceed the carrying amount of the asset will be recognised in profit or loss.
(vii) Derivative liability
Management uses valuation techniques, such as a Black-Scholes model, when determining the fair value of derivative liabilities. Inputs to the
valuation technique include assumptions and estimates on volatility and risk-free interest rates.
(viii) Leases
The consolidated entity assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to control
the use of an identified asset for a period of time in exchange for consideration. A single recognition and measurement approach for all leases,
except for short-term leases and leases of low-value assets. The consolidated entity recognises lease liabilities to make lease payments and right-of-
use assets representing the right to use the underlying assets.
Impairment of financial assets
(ix)
At the end of each reporting period, the consolidated entity assesses whether there is objective evidence that a financial asset has been impaired.
A financial asset or a group of financial assets is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one
or more events (a “loss event”) having occurred, which has an impact on the estimated future cash flows of the financial asset(s).
Useful lives and residual values of depreciable and amortisable assets
(x)
Management reviews its estimate of useful lives and residual values of depreciable and amortisable assets at each reporting date, based on the
expected benefit from these assets.
44
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45
Hydrix annual report 2021 Hydrix annual report 2021 Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
3 Operating Segments
Identification of reportable operating segments
The consolidated entity is organised into four operating segments based on the internal reports that are reviewed and used by the Board of
Directors [who are identified as the Chief Operating Decision Makers ('CODM')] in assessing performance and in determining the allocation of
resources. There is no aggregation of operating segments.
Operating segments are presented using the 'management approach’, where the information presented is on the same basis as the internal
reports provided to the CODM, who are responsible for the allocation of resources to operating segments and assessing their performance.
The consolidated entity's operations are in two geographical locations, being Australia and Singapore.
Operating Segment Information
Consolidated - 2021
Hydrix
Services
$
Hydrix Limited
Hydrix
Medical
$
Hydrix Services
Hydrix
Digital
$
Hydrix
Ventures
$
Total
Operations
$
Hydrix
Hydrix
Revenue
Sales to external customers Revenue from ordinary activities
Other revenue
Total Segment revenue
Unallocated revenue:
Other revenue
Interest income
Total Segment Revenue
7,373,601
1,626,416
9,000,017
-
-
9,000,017
71,620
32,319
103,939
-
-
103,939
-
-
-
-
-
-
-
-
-
-
-
-
(1,682,068)
(799,416)
(557,393)
(649)
EBITDA
Unallocated EBITDA
Total EBITDA
Finance costs
Depreciation and amortisation expense
Impairment of goodwill
Impairment of receivables
Gain/(Loss) on financial instruments at FVTPL
Gain/(Loss) on contingent consideration liability
Unrealised foreign exchange Gain/(Loss)
Contract asset write offs (c/fwd from FY20)
Unallocated expenses:
Finance costs
Depreciation and amortisation expense
Share based payment expenses
Gain/(Loss) on financial instruments at FVTPL
Profit/(Loss) before income tax expense
Income tax (expense)/ benefit
(Loss) after income tax expense
Assets
Segment assets
Unallocated assets:
Cash and cash equivalents
Intangible assets
Other assets
Total assets
Liabilities
Segment liabilities
Unallocated liabilities:
Borrowings
Other liabilities
Total liabilities
(390,813)
(2,428,553)
(1,269,400)
94,602
-
-
-
(173,010)
-
-
-
-
(5,849,242)
-
(5,849,242)
-
(17,727)
-
-
-
(190,486)
215,281
-
-
-
-
-
(792,348)
-
(792,348)
4,760,794
4,541,305
-
-
-
4,760,794
-
-
-
4,541,305
7,778,330
2,600,474
-
-
7,778,330
-
-
2,600,474
7,445,221
1,658,735
9,103,956
192,454
15,328
9,311,738
(3,039,526)
(1,067,758)
(4,107,284)
(390,813)
(2,446,280)
(1,269,400)
94,602
250,303
(190,486)
(79,537)
(173,010)
(719,269)
(620)
(426,771)
(320,128)
(9,778,693)
-
(9,778,693)
-
-
-
-
-
-
-
-
-
-
-
-
(557,393)
-
(557,393)
-
-
-
-
250,303
-
(294,818)
-
-
-
-
-
(45,164)
-
(45,164)
-
-
-
-
-
-
-
-
-
2,847,385
12,149,484
-
-
-
2,847,385
-
-
-
-
6,647,225
525,000
57,141
19,378,850
10,378,804
2,250,000
1,040,393
13,669,197
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
3 Operating Segments (continued)
Consolidated - 2020
Hydrix
Services
$
Hydrix Limited
Hydrix
Medical
$
Hydrix Services
Hydrix
Digital
$
Hydrix
Ventures
$
Total
Operations
$
Hydrix
Hydrix
Revenue
Sales to external customers Revenue from ordinary activities
Other revenue
Total Segment Revenue
Unallocated revenue:
Other revenue
Interest income
Total Segment Revenue
14,949,975
770,371
15,720,346
-
-
15,720,346
-
-
-
-
-
-
EBITDA
Unallocated EBITDA
Total EBITDA
Finance costs
Depreciation and amortisation expense
Impairment of receivables
Gain/(Loss) on financial instruments at FVTPL
Gain/(Loss) on contingent consideration liability
Unrealised foreign exchange Gain/(Loss)
Contract asset write offs (c/fwd from FY19)
Unallocated expenses:
Debt extinguishment loss
Finance costs
Depreciation and amortisation expense
Impairment of plant and equipment
Other
Profit/(Loss) before income tax expense
Income tax (expense)/ benefit
(Loss) after income tax expense
Assets
Segment assets
Unallocated assets:
Cash and cash equivalents
Intangible assets
Other assets
Total assets
Liabilities
Segment liabilities
Unallocated liabilities:
Borrowings
Other liabilities
Total liabilities
1,772,384
(662,518)
(433,850)
(1,146,940)
(133,091)
-
-
-
(74,508)
-
-
-
-
-
(16,006)
(346,727)
(362,733)
-
(1,933)
-
-
(85,994)
280,938
-
-
-
-
-
-
(469,507)
-
(469,507)
9,917,277
4,496,924
-
-
-
9,917,277
-
-
-
4,496,924
7,356,022
2,609,461
-
-
7,356,022
-
-
2,609,461
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(2,576)
-
-
-
-
-
-
-
-
-
-
-
-
(2,576)
-
(2,576)
14,949,975
770,371
15,720,346
178,469
927
15,899,742
1,107,290
(1,328,891)
(221,601)
(433,850)
(1,148,873)
(133,091)
927,303
(85,994)
280,938
(74,508)
(1,063,586)
(871,110)
(11,708)
(201,652)
165,000
(2,872,734)
(346,727)
(3,219,461)
2,235,129
17,174,330
-
-
-
2,235,129
-
-
-
-
1,690,194
525,000
158,349
19,022,873
9,965,483
5,992,597
768,823
16,726,903
During the year the consolidated entity temporarily ceased discretionary expenditure and investment in Hydrix Digital.
46
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30
Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
4 Revenue
Revenue from contracts with customers
Rendering of services
Project materials and travel recovered
Support and maintenance
Sales of AngelMed Guardian System
Other income:
Research and development tax incentive
Rental income
Government grant
Other income
Total income from continuing operations
Disaggregation of revenue
The disaggregation of revenue from contracts with customers is as follows:
Timing of revenue recognition
Goods transferred at a point in time
Services transferred over time
2021
$
6,264,786
971,908
136,907
71,620
7,445,221
117,133
-
1,716,151
17,905
1,851,189
9,296,410
2020
$
13,894,275
892,474
147,476
-
14,934,225
262,393
15,750
675,500
-
953,643
15,887,868
71,620
7,373,601
7,445,221
-
14,934,225
14,934,225
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
4
Revenue (continued)
Accounting Policy - Revenue recognition
Revenue is recognised when it is probable that the economic benefit will flow to the consolidated entity and the revenue can be reliably
measured. Revenue is measured at the fair value of the consideration received or receivable.
Revenue from contracts with customers
Revenue is recognised over time at an amount that reflects the consideration to which the consolidated entity is expected to be entitled in
exchange for transferring goods or services to a customer. For each contract with a customer, the consolidated entity: identifies the contract
with a customer; identifies the performance obligations in the contract; determines the transaction price which takes into account estimates of
variable consideration and the time value of money; allocates the transaction price to the separate performance obligations on the basis of the
relative stand-alone selling price of each distinct good or service to be delivered; and recognises revenue when or as each performance
obligation is satisfied in a manner that depicts the transfer to the customer of the goods or services promised.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as discounts, rebates and refunds,
any potential bonuses receivable from the customer and any other contingent events. Such estimates are determined using either the 'expected
value' or 'most likely amount' method. The measurement of variable consideration is subject to a constraining principle whereby revenue will
only be recognised to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue recognised will not
occur. The measurement constraint continues until the uncertainty associated with the variable consideration is subsequently resolved. Amounts
received that are subject to the constraining principle are initially recognised as deferred revenue in the form of a separate refund liability.
(i)
(ii)
(iii)
(iv)
(v)
Rendering of services
Revenue is recognised over time by measuring progress towards the complete satisfaction of each performance obligation. The
input method is used to measure progress of performance as a labour cost input method allows revenue to be recognised based on
labour hours expended relative to the total labour hours expected to be input to the complete satisfaction of the performance
obligation. At the end of each reporting period progress towards complete satisfaction of the performance obligation is
remeasured.
Interest income
Interest income is recognised as interest accrues using the effective interest method. This is a method of calculating the amortised
cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate, which is the
rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the net carrying
amount of the financial asset.
Research and development tax incentive
R&D tax incentives will be recognised in profit before tax (in EBIT) during the period in which they are received from the Australian
Taxation Office.
Government grant
Government grant represents the job keeper and cash flow boost payments received from Federal Government in response to
ongoing novel coronavirus (COVID-19) pandemic. Government grants are recognised in the financial statements at their fair values
when there is a reasonable assurance that the Group will comply with the requirements and that the grant will be received.
Other income
Other income is recognised when it is received or when the right to receive payment is established.
48
49
31
32
Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
5
Expenses
(Loss) before income tax includes the following specific expenses:
2021
$
2020
$
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
5
Expenses (continued)
Accounting Policy - Expenses
Employee benefits expenses
Salaries, wages and leave entitlements
Defined contribution superannuation expense
Employee on-costs
Employee training and development
Total employee benefits expenses
Depreciation
Plant and equipment
Computer equipment
Furniture and fixtures
Right-of-use Asset
Amortisation
Software - including CHEF Framework
Customer Contracts & Relationships
8,503,199
707,968
412,042
31,344
9,654,553
13,857
62,258
37,151
461,458
574,724
1,512,212
359,964
1,872,176
10,056,523
880,543
570,320
110,570
11,617,956
28,844
41,755
36,470
461,458
568,527
525,054
67,000
592,054
Total depreciation and amortisation expense
2,446,900
1,160,581
Finance costs
Interest expense on lease liabilities
Pure Asset Management facility fees
Interest on loans and borrowing costs
Total finance costs
Gain/(Loss) on financial instruments at fair value through profit or loss
Gain/(Loss) on derivatives
Gain/(Loss) on financial assets
Other expenses
Bad debts written off
Consultancy charges
Corporate advisory transaction costs
Directors' fees
Insurance
IT related expenses
Legal and professional charges
Listing fees and share register maintenance
Recruitment fees
Travelling costs
Administration expenses
Total other expenses
389,641
411,487
308,954
1,110,082
(320,128)
250,303
(69,825)
4,415
391,336
-
197,783
134,020
336,496
325,948
104,775
26,134
5,140
444,793
1,970,840
414,942
111,712
778,307
1,304,961
916,921
10,382
927,303
74,508
305,225
447,250
197,783
116,034
367,006
250,631
85,797
124,243
119,744
203,892
2,292,113
Amortisation
The amortisable amount of all intangible assets is amortised on a straight-line basis over the period of their expected benefit to the consolidated
entity commencing from the time the asset is recognised.
Depreciation
The depreciable amount of all fixed assets is depreciated on a diminishing value basis over the asset's useful life to the consolidated entity
commencing from the time the asset is held ready for use.
Defined contribution superannuation expense
Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred.
Finance costs
All finance costs are expensed in the period in which they are incurred.
6
Income Taxes
(a)
Income tax (expense)/ benefit
Current income tax
Deferred tax - origination and reversal of temporary differences
Adjustment recognised for prior periods
Numerical reconciliation of income tax benefit and tax at the statutory rate
Loss before income tax expense
Tax at the statutory tax rate of 26.00% (Previous year 27.50%)
Tax effect amounts which are not (deductible) / taxable in calculating taxable income:
Temporary differences not brought to account
Share based payments
R&D tax incentive income - non assessable
Deferred Tax Asset (DTA) on tax losses not brought to account
(b)
(c)
Deferred tax assets
The balance comprises temporary differences attributable to:
Allowance for expected credit losses
Provision for annual leave
Provision for long service leave
Derivative liability
Lease liability
Accruals
Lease make-good provision
Deferred tax liabilities
The balance comprises temporary differences attributable to:
Contingent consideration
Contract assets
Financial assets at fair value through profit & loss
Intangible assets
2021
$
-
-
-
-
2020
$
-
(346,727)
-
(346,727)
9,778,693
2,872,734
2,542,460
26.00%
790,002
27.50%
(211,136)
(110,960)
30,455
(2,250,818)
-
(168,098)
(50,458)
72,158
(990,331)
(346,727)
26,688
180,191
106,891
200,437
968,229
242,662
49,236
1,774,334
57,132
283,541
59,375
676,406
1,076,454
54,243
139,990
130,318
-
1,072,807
25,885
52,307
1,475,550
-
187,503
-
941,320
1,128,823
51
50
33
34
Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
6
Income Taxes (continued)
(d)
(e)
(f)
Net deferred tax assets / (liabilities)
Provision for impairment
Movement in deferred tax assets/(liabilities)
Opening balance
Credited to profit and loss
Credited to equity
Closing Balance
Deferred tax assets not brought to account at reporting date
Operating losses
Capital losses
2021
2020
697,880
697,880
$
-
-
-
-
346,727
346,727
$
346,727
(346,727)
-
-
7,566,481
74,097
5,635,121
78,372
The deferred tax asset not brought to account will only be obtained if:
(a) future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;
(b) the conditions for deductibility imposed by tax legislation continue to be complied with; and
(c) the company is able to meet the continuity of business and or continuity of ownership tests
Accounting Policy - Income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable income tax rate for
each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary differences, unused tax losses and the
adjustment recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the assets are
recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for:
● When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not
a business combination and that, at the time of the transaction, affects neither the accounting nor taxable profits; or
● When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the timing of the reversal
can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts
will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax assets recognised
are reduced to the extent that it is no longer probable that future taxable profits will be available for the carrying amount to be recovered.
Previously unrecognised deferred tax assets are recognised to the extent that it is probable that there are future taxable profits available to
recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against current tax
liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on either the same taxable entity
or different taxable entities which intend to settle simultaneously.
Hydrix Limited (the 'head entity') and its wholly-owned Australian subsidiaries have formed an income tax consolidated group under the tax
consolidation regime. The head entity and the subsidiary in the tax consolidated group continue to account for their own current and deferred
tax amounts. The tax consolidated group has applied the 'separate taxpayer within group' approach in determining the appropriate amount of
taxes to allocate to members of the tax consolidated group.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
7
Cash and cash equivalents
Cash at bank
Cash on hand
2021
$
6,647,223
2
6,647,225
2020
$
1,690,192
2
1,690,194
Reconciliation to cash and cash equivalents at the end of the financial year
The above figures are reconciled to cash and cash equivalents at the end of the financial year as shown in the statement of cash
flows as follows:
Balances as above
Balance as per statement of cash flows
Accounting Policy - Cash and cash equivalents
6,647,225
6,647,225
1,690,194
1,690,194
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with
original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of
changes in value.
8
Trade and other receivables
Current
Trade receivables
Less: Allowance for expected credit losses
GST receivable
Other receivables
2021
$
616,044
(102,647)
513,397
57,915
3,192
574,504
2020
$
2,998,012
(197,249)
2,800,763
21,437
266,010
3,088,210
Allowance for expected credit losses
The consolidated entity has recognised a profit of $94,602 in profit or loss in respect of the expected credit losses for the year
ended 30 June 2020 (30 June 2020: loss of $133,091).
The aging of the receivables and allowance for expected credit losses provided for above are as follows:
Consolidated
Not overdue
0 to 3 months overdue
3 to 6 months overdue
Over 6 months overdue
Accounting Policy - Trade and other receivables
Expected credit
loss rate
2021
%
0.6%
0.9%
12.5%
57.7%
Gross carrying
amount
2021
$
333,428
74,642
44,000
163,974
616,044
Allowance for
expected credit
losses
2021
$
1,917
688
5,500
94,542
102,647
Net carrying
amount
2021
$
331,511
73,954
38,500
69,432
513,397
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any
allowance for expected credit losses. Trade receivables are generally due for settlement within 30 days.
The consolidated entity has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance.
To measure the expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
52
53
35
36
Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
9
Plant and Equipment
Plant and equipment
At cost
Less accumulated depreciation
Computer equipment
At cost - Computer equipment
Less accumulated depreciation - Computer equipment
Furniture and fixtures
At cost - furniture and fixtures
Less accumulated depreciation - furniture and fixtures
2021
$
168,225
(81,202)
87,023
288,151
(186,775)
101,376
400,979
(134,774)
266,205
2020
$
127,129
(67,345)
59,784
175,001
(124,517)
50,484
315,386
(97,623)
217,763
454,604
328,031
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below:
Balance as at 1 July 2019
Additions
Impairment expense
Depreciation expense
Plant &
Equipment
$
286,792
3,488
(201,652)
(28,844)
Computer
Equipment
$
54,251
37,988
-
(41,755)
Furniture &
Fixtures
$
253,099
1,134
-
(36,470)
Total
$
594,142
42,610
(201,652)
(107,069)
Balance as at 30 June 2020
59,784
50,484
217,763
328,031
Balance as at 1 July 2020
Additions
Depreciation expense
59,784
41,096
(13,857)
50,484
113,150
(62,258)
217,763
85,593
(37,151)
328,031
239,839
(113,266)
Balance as at 30 June 2021
87,023
101,376
266,205
454,604
Accounting Policy - Plant and equipment
The useful lives adopted for each class of depreciable assets are:
Class of Fixed Asset
Plant and equipment
Computer equipment
Furniture and fixtures
Leasehold improvements
Useful lives
2 to 5 years
3 to 4 years
10 to 15 years
Over the initial period of the lease
Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes expenditure that is
directly attributable to the acquisition of the items. In the event the carrying amount of plant and equipment is greater than the estimated
recoverable amount, the carrying amount is written down immediately to the estimated recoverable amount and impairment losses are
recognised in profit or loss.
A formal assessment of recoverable amount is made when impairment indicators are present (refer to Note 1(f) for details of impairment). The
carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable amount from these
assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the asset's employment and
subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.
An item of plant and equipment is derecognised upon disposal or when there is no future economic benefit to the consolidated entity. Gains and
losses between the carrying amount and the disposal proceeds are taken to profit or loss.
54
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
10 Intangible assets
Distribution Rights (i)
Less: Accumulated amortisation (ii)
Goodwill
Less: Impairment
Brand Name
Less: Impairment
Customer Contracts & Relationships
Less: Accumulated amortisation (iii)_
Software - including CHEF Framework
Less: Accumulated amortisation (iii)-
2021
$
4,459,426
-
4,459,426
1,269,400
(1,269,400)
-
525,000
-
525,000
536,000
(536,000)
-
2020
$
4,459,426
-
4,459,426
1,269,400
-
1,269,400
525,000
-
525,000
536,000
(176,036)
359,964
2,833,823
(2,832,284)
1,539
2,582,139
(1,320,072)
1,262,067
4,985,965
7,875,857
Distribution Rights
The distribution rights is a finite life asset which is not yet available for use. The recoverable amount of the distribution rights has been
determined using a value-in-use calculation.
(i) On the 13th of March 2020 the consolidated entity entered into an agreement to acquire the exclusive Asia Pacific distribution rights for the
AngelMed Guardian System payable with a mix of upfront and contingent consideration. The distributions rights were measured based on the
cost of shares issued and fair value of the contingent consideration on acquisition date. The contingent consideration is payable in three
tranches upon receipt of FDA and other applicable regulatory approvals of AngelMed’s next generation product.
(ii) No amortisation has been recognised on the distribution rights for the AngelMed Guardian System given the Distribution and Supply
agreement continues in force for seven years, with year one not commencing until after FDA approval has been received and the first
commercial implant of the product has received reimbursement in the United States of America.
Effective Useful Life
(iii) During the year Management reassessed the effective useful life of intangible assets with finite lifespans allocated to the Hydrix Services
cash-generating unit and determined that the expected benefit period for these assets should be reduced to one year. This reassessment
resulted in additional amortisation charges of $292,964 and $958,087 to the Customer Contracts & CHEF Software intangible assets.
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out below:
Balance as at 1 July 2019
Additions
Amortisation expense
Balance as at 30 June 2020
Balance as at 1 July 2020
Additions
Impairment expense
Amortisation expense
Balance as at 30 June 2021
Distribution
Rights
$
-
4,459,426
-
4,459,426
4,459,426
-
-
-
4,459,426
Goodwill
$
1,269,400
-
-
1,269,400
1,269,400
-
(1,269,400)
-
-
Brand Name
$
525,000
-
-
525,000
525,000
-
-
-
525,000
Customer
Contracts
$
426,964
-
(67,000)
359,964
359,964
-
-
(359,964)
-
Software
including CHEF
$
1,774,759
12,362
(525,054)
1,262,067
1,262,067
251,684
-
(1,512,212)
1,539
Total
$
3,996,123
4,471,788
(592,054)
7,875,857
7,875,857
251,684
(1,269,400)
(1,872,176)
4,985,965
55
37
38
Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
10 Intangible assets (continued)
The recoverable amount of the consolidated entity's indefinite life or not yet available for use intangible assets, being Brand Name, Goodwill,
and Distribution Rights, have been determined by a value-in-use calculation using a discounted cash flow model, based on a 2 year projection
period approved by the directors and extrapolated for a further 3 years using a steady rate, together with a terminal value. Key assumptions are
those to which the recoverable amount of an asset or cash-generating units is most sensitive and are listed in the tables below.
Impairment testing
Brand Name, Goodwill and Distribution Rights have been allocated to the following cash-generating units:
Goodwill
Hydrix Services
2021
$
-
-
2020
$
1,269,400
1,269,400
In assessing the carrying value of Goodwill, Management took various factors into consideration and concluded that Goodwill was fully
impaired. While the revenue pipeline remains healthy, the business has been impacted by COVID. Management anticipates this situation will
improve as global vaccinations advance, travel resumes and business appetite to invest in early stage medtech companies improves.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
10 Intangible assets (continued)
Brand Name
Group (Hydrix Services & Hydrix Medical)
2021
$
525,000
525,000
2020
$
525,000
525,000
The key assumptions used in the discounted cash flow model for the Group CGU are included in the tables on the previous page.
Sensitivity
As disclosed in note 2, the directors have made judgements and estimates in respect of impairment testing. Should these judgements and
estimates not occur, the resulting carrying amount of Brand Name may decrease. The sensitivities are as follows: (a) Revenue and cost of sales
would need to decrease by more than 50% for the Group of cash generating units before Brand Name would need to be impaired, with all other
assumptions remaining constant. (b) The discount rate would be required to increase by at least 50% for the Group of cash generating units
before Brand Name would need to be impaired, with all other assumptions remaining constant.
The directors believe that other reasonable changes in the key assumptions on which the recoverable amount of the consolidated entity's Brand
Name is based on would not cause the cash-generating unit’s carrying amount to exceed its recoverable amount.
The following key assumptions were used in the discounted cash flow model for the Hydrix Services division:
Accounting Policy - Intangible assets
Item
Assumption
Rationale
Revenue Growth Rates – FY 2022 onwards
Per approved budget
Revenue Growth Rates – FY 2023 onwards
10% p.a annual average growth
Expenditure Growth Rates – FY 2022 onwards
Per approved budget
Expenditure Growth Rates – FY 2023 onwards
5% p.a annual average growth
5 years
25.00%
12% of revenues
17% pre-tax
Years forecasted
Tax Rate
Working Capital
Discount Rate
Distribution Rights
Hydrix Medical
Based on existing contracts and proposals in various
stages of negotiation
The ‘buy, build, invest’ strategy is expected to continue to
increase both the scale of the services business and
generate other revenue streams
In line with expected margins
The business has existing capacity to deliver increased
revenues without adding significant costs. Managements
estimate also takes into account the prevailing interest
rate and efforts to contain costs.
5 years as per recommended length of time per AASB136
Base rate entity company tax rate
Average working capital required
Management’s estimate of the Group’s weighted average
cost of capital, the risk free rate and the volatility of the
share price relative to market movements
2021
$
4,459,426
4,459,426
2020
$
4,459,426
4,459,426
The following key assumptions were used in the discounted cash flow model for the Hydrix Medical division:
Item
Assumption
Rationale
Revenue Growth Rates – FY 2022 onwards
Per approved budget
Based on estimated timing of key regulatory approvals
and market adoption
Revenue Growth Rates – FY 2023 onwards
Minimum sales requirements
outlined in distribution and supply
Minimum performance required
Expenditure Growth Rates – FY 2022 onwards Per approved budget
In line with expected margins
Expenditure Growth Rates – FY 2023 onwards
Years forecasted
Tax Rate
Working Capital
Discount Rate
56
Minimum sales requirements
outlined in distribution and supply
5 years
25.00%
16% of revenues
17% pre-tax
Minimum performance required
5 years as per recommended length of time per AASB136
Base rate entity company tax rate
Average working capital required
Management’s estimate of the Group’s weighted average
cost of capital, the risk free rate and the volatility of the
share price relative to market movements
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value at the date of the
acquisition. Intangible assets acquired separately are initially recognised at cost. Indefinite life intangible assets are not amortised and are
subsequently measured at cost less any impairment. Finite life intangible assets are subsequently measured at cost less amortisation and any
impairment. The gains or losses recognised in profit or loss arising from the derecognition of intangible assets are measured as the difference
between net disposal proceeds and the carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are
reviewed annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation
method or period.
Distribution Rights
The acquired distribution rights have been measured based on the cost of shares issued and fair value of the contingent considerations on
acquisition date. The distribution rights is a finite life asset which is not yet available for use. The recoverable amount of the distribution rights
has been determined using a value-in-use calculation.
Goodwill
Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested annually for impairment, or more
frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses.
Impairment losses on goodwill are taken to profit or loss and are not subsequently reversed.
Customer Contracts
Customer contracts acquired in a business combination are amortised on a straight-line basis over the period of their expected benefit, being
their finite life of 8 years.
Brand Name
The Hydrix brand name is thought to have an indefinite life and is not amortised. Instead, the brand is tested annually for impairment, or more
frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses.
Impairment losses on the brand are taken to profit or loss are are not subsequently reversed.
Software (including CHEF)
Significant costs associated with the Common Hydrix Embedded Framework (CHEF) software are deferred and amortised on a straight-line basis
over a period of 5 years given its assumed amortisation rate of 20%. Other software costs are deferred and amortised on a straight-line basis
over the period of their expected benefit, being their finite life of 2 years.
57
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Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
11 Financial assets at fair value through profit & loss
Listed ordinary shares
Unlisted ordinary shares
Convertible Note
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
12 Trade and other payables
Trade payables
Other payables
Accrued liabilities
2021
$
33,371
2,565,303
248,428
2,847,102
2020
$
30,224
2,204,480
-
2,234,704
Reconciliation
Reconciliation of the fair values at the beginning and end of the current and previous financial year are set out below:
Accounting Policy - Trade and other payables
2021
$
346,322
260,208
922,863
2020
$
684,371
363,619
199,111
1,529,393
1,247,101
Opening fair value as at 1 July 2019
Additions (i) (ii)
Revaluation increments/(decrements)
Closing fair value as at 30 June 2020
Opening fair value as at 1 July 2020
Additions (iii) (iv) (v) (vi)
Revaluation increments/(decrements)
Revaluation increments/(decrements) due to foreign exchange
Closing fair value as at 30 June 2021
Unlisted
ordinary
$
379,470
1,825,010
-
2,204,480
2,204,480
400,038
255,603
(294,818)
2,565,303
Listed ordinary
shares
$
19,842
-
10,382
30,224
Convertible
Note
$
-
-
-
-
30,224
-
3,147
-
256,875
(8,447)
33,371
248,428
Total
$
399,312
1,825,010
10,382
2,234,704
2,234,704
656,913
250,303
(294,818)
2,847,102
(i) On the 13th of March 2020 the consolidated entity acquired 1,000,000 shares of Series A Preferred Stock in Angel Medical Systems, Inc., for
$1,625,000 with $812,500 of that consideration being provided as services in-kind.
(ii) During the last quarter of 2020 the consolidated entity acquired 6,667 shares of Series A Stock of Cyban Pty Ltd for $200,010.
(iii) During July 2020 the consolidated entity acquired 3,333 shares of Series A stock in Cyban Pty Ltd for $99,990.
(iv) During July 2020 the consolidated entity entered into a convertible note agreement with Gyder Surgical Pty Ltd with a total issue price of
$250,000.
(v) During September 2020 the consolidated entity received 4,446 ordinary shares in Gyder Surgical Pty Ltd valued at $249,998 as payment for
services rendered.
(vi) During April 2021 the consolidated entity acquired 1,430 shares of Series A Stock of Cyban Pty Ltd for $50,050.
Accounting Policy - Financial assets at fair value through profit & loss
All assets and liabilities, measured at fair value, are classified using a three level hierarchy, based on the lowest level of input that is significant
to the entire fair value measurement, being: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity
can access at the measurement date; Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or
liability, either directly or indirectly; and Level 3: Unobservable inputs for the asset or liability. Considerable judgement is required to determine
what is significant to fair value and therefore which category the asset or liability is placed in can be subjective. Refer to note 1(m) for further
information on fair value measurement.
These amounts represent liabilities for goods and services provided to the consolidated entity prior to the end of the financial year and which are
unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts are unsecured and are usually
paid within 30 days of recognition.
13 Contract assets and contract liabilities
Contract assets
Current
2021
$
1,090,544
2020
$
681,832
The value of contract assets at the end of the reporting period was $1,090,544 (30 June 2020: $681,832) and is expected to be
invoiced in future periods as follows:
Consolidated
Within 6 months
6 to 12 months
12 to 18 months
18 to 24 months
Contract liabilities
Current
2021
$
1,090,544
-
-
-
1,090,544
2021
$
2020
$
681,832
-
-
-
681,832
2020
$
1,601,717
1,291,008
Unsatisfied performance obligations
The aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied at the end of the
reporting period was $1,601,717 (30 June 2020: $1,291,008) and is expected to be recognised as revenue in future periods as
follows:
Consolidated
Within 6 months
6 to 12 months
12 to 18 months
18 to 24 months
2021
$
699,307
466,667
435,743
-
1,601,717
2020
$
765,166
525,842
-
-
1,291,008
Accounting Policy - Contract assets and contract liabilities
Contract assets
Contract assets are recognised when the consolidated entity has transferred goods or services to the customer but where an unconditional right
to consideration is yet to be established, less any allowance for expected credit losses.
Contract liabilities
Contract liabilities represent the consolidated entity's obligation to transfer goods or services to a customer and are recognised when a
customer pays consideration before the consolidated entity has transferred the goods or services to the customer.
58
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Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
14 Other liabilities
Current
Customer deposits
Contingent consideration liability C
Non - Current
Contingent consideration liability NC
2021
$
-
2,499,687
2,499,687
2020
$
120,000
-
120,000
-
-
2,524,482
2,524,482
Contingent consideration liability
The contingent consideration for the Asia Pacific distribution rights of the AngelMed Guardian System (refer to Note 10) is payable
in three tranches upon receipt of FDA and other applicable regulatory approvals of AngelMed’s next generation product.
Accounting Policy - Other liabilities
Contingent consideration liability
The contingent consideration liability is measured based on management's estimate of the expected cash outflows and the probability of
meeting the milestones in accordance with the terms of the acquisition of AngelMed Distribution Rights agreement (see Note 10). The liability
also factors in the time value of money at acquisition date and year-end; the discount rate applied was 10% and 6% respectively.
15 Employee benefits
Current
Annual leave
Long service leave
Non - current
Long service leave (NC)
Accounting Policy - Employee benefits
2021
$
693,044
209,258
902,302
2020
$
509,056
224,955
734,011
201,863
201,863
248,931
248,931
Wages and salaries, annual leave and sick leave
Liabilities for wages and salaries, annual leave and long service leave which are expected to be settled within 12 months of the reporting date
and which the entity does not have a conditional right to defer settlement beyond 12 months, are recognised as part of provisions in respect of
employees’ service up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled.
Long service leave
The liability for long service leave is recognised in the provision for long service leave and measured as the present value of expected future
payments to be made in respect of services provided by employees up to the reporting date. Consideration is given to expected future wage and
salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the
reporting date on corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
16 Provisions
Non - current
Lease make-good provision
2021
$
189,371
189,371
2020
$
190,209
190,209
Lease make-good provision
The provision represents the present value of the estimated costs to make-good the Mulgrave premises leased by the consolidated
entity expiring in the year 2025 with options to extend to two further terms of four years each.
Movements in provisions
Movements in the lease make-good provision during the current financial year are set out below:
Consolidated
Carrying amount at the start of the year
Additional provisions recognised
Amounts used
Unused amounts reversed
Carrying amount at the end of the year
Accounting Policy - Provisions
2,021
$
190,209
(838)
-
-
189,371
2,020
$
180,854
9,355
-
-
190,209
A provision is recognised in the statement of financial position when the consolidated entity has a present legal or constructive obligation as a
result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation.
17 Borrowings
Current
Shareholder loans - Unsecured C
Pure Asset Management loan - Secured C
BOQ Finance
Non-Current
Shareholder loans - Unsecured
Pure Asset Management loan - Secured
Less: Capitalised Transaction Costs / Warrant Shares
2021
$
1,000,000
-
-
1,000,000
1,250,000
-
-
1,250,000
2020
$
-
250,000
26,664
276,664
2,750,000
3,250,000
(257,403)
5,742,597
Total unsecured borrowings
An unsecured loan facility of $1,250,000 with a 6% p.a. interest rate has been provided by a major shareholder. As at 30 June
2021, this loan was fully drawn. The loan is repayable on 31 December 2022 or such later date as agreed by the parties.
A separate unsecured loan facility of $1,000,000 with a 6% p.a. interest rate has been provided by a shareholder. As at 30 June
2021, this loan was fully drawn and was repayable on 17 March 2022 or such later date as agreed by the parties. Subsequent to
the end of the financial year the maturity date of this loan was extended to 31 December 2022.
Total secured borrowings including assets pledged as security
On 16 November 2020, the consolidated entity repaid the final $3,250,000 owing under the Pure Asset Management refinance
facility.
Refer to note 24 for further information on financial instruments.
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Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
17 Borrowings (continued)
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
19 Leasing
Financing arrangements
Unrestricted access was available at the reporting date to the following lines of credit:
The consolidated entity leases an office building. The lease liability is secured by the related underlying right-of-use asset. The maturity analysis
of lease payments at 30 June 2021 were as follows:
Total facilities
Pure Asset Management loan
Shareholder loans
Used at the reporting date
Pure Asset Management loan
Shareholder loans
Unused at the reporting date
Pure Asset Management loan
Shareholder loans
Accounting Policy - Borrowings
2021
$
-
2,250,000
2,250,000
-
2,250,000
2,250,000
2020
$
3,500,000
2,750,000
6,250,000
3,500,000
2,750,000
6,250,000
-
-
-
-
-
-
Lease payments
Lease liabilities
Current
Non-current
Maturity analysis
Within one year One to five years
$
981,281
$
3,682,614
After five years
$
-
2021
$
637,184
3,086,770
3,723,954
Total
$
4,663,895
2020
$
507,294
3,393,824
3,901,118
During the year ended 30 June 2021 the consolidated entity and its landlord agreed to the following rent concessions as a direct consequence of
the COVID-19 pandemic:
a) for the period from 1 April 2020 to 30 June 2020, 100.0% of the rent is deferred;
b) for the period from 1 July 2020 to 30 September 2020, 50.0% of the rent is deferred;
c) for the period from 26 October 2020 to 31 December 2020, 33.0% of the rent is deferred and 33.0% of the rent is waived; and
d) for the period from 19 February 2021 to 28 March, 33.5% of the rent is deferred and 33.5% of the rent is waived
The deferred rent is payable in equal monthly instalments during the period from 1 July 2021 to 31 December 2025.
Borrowings are classified as current liabilities unless the consolidated entity has an unconditional right to defer settlement of the liability for at
least 12 months after balance date. Loans and borrowings are initially recognised at the fair value of the consideration received, net of
transaction costs. They are subsequently measured at amortised cost using the effective interest method.
Accounting Policy - Lease payments
18 Derivative liability
The consolidated entity has elected not to recognise a lease liability for short term leases (leases with an expected term of 12 months or less) or
for leases of low value assets. Payments made under such leases are expensed on a straight-line basis. In addition, certain variable lease
payments are not permitted to be recognised as lease liabilities and are expensed as incurred.
In December 2019, 8,000,000 warrant shares were issued to Pure Asset Management as interest consideration on the borrowings. The
warrants have an exercise price of $0.30 and expiry date of 17 December 2023. Refer to Note 17 for details on the borrowings.
Set out below are the carrying amounts of the consolidated entity’s right-of-use assets:
The fair value of the embedded derivative liability was determined using the Black-Scholes model using the following inputs:
Share price at measurement date
Expected volatility
Dividend yield
Risk-free interest rate
Carrying amount of liability
2021
$0.19
110.00%
0.00%
0.83%
$770,910
2020
$0.09
90.00%
0.00%
1.47%
$450,782
Right-of-use assets
Depreciation on Right-of-use assets
2021
$
2,999,477
(922,916)
2,076,561
2020
$
2,999,477
(461,458)
2,538,019
62
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Hydrix annual report 2021 Hydrix annual report 2021 Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
20 Equity - issued capital
Consolidated
a) Ordinary shares - fully paid
Movements in ordinary share capital
Balance
Issue of shares to KMP
Issues of shares under Placement
Issues of shares under Placement
Issues of shares to KMP under Placement
Issue of shares to KMP in lieu of cash payments
Issue of shares towards purchase of distribution rights
Share issue transaction costs, net of tax
Balance
Issue of shares to employees under company's LTIP
Issue of shares under rights issue
Issue of shares under option
Issue of shares under option
Issue of shares under option
Issue of shares under option
Issue of shares to employees under company's LTIP
Issue of shares to employees under company's LTIP
Issue of shares under placement
Issue of shares to KMP in lieu of cash payments
Issue of shares under option
Issue of shares to employees under company's LTIP
Issue of shares under option
Issue of shares under option
Issue of shares under placement
Issue of shares to KMP
Issue of shares under option
Issue of shares under option
Issue of shares under option
Issue of shares under placement
Issue of shares to KMP
Issue of shares under option
Issue of shares under option
Issue of shares under option
Issue of shares to employees under company's LTIP
Share issue transaction costs, net of tax
Balance
2021
Shares
162,815,530
Date
1-Jul-19
8-Nov-19
8-Nov-19
27-Nov-19
17-Dec-19
17-Dec-19
12-Mar-20
30-Jun-20
30-Jul-20
30-Jul-20
21-Aug-20
28-Aug-20
28-Aug-20
3-Sep-20
4-Sep-20
16-Sep-20
18-Sep-20
18-Sep-20
24-Sep-20
2-Oct-20
6-Oct-20
25-Oct-20
6-Nov-20
6-Nov-20
11-Nov-20
16-Nov-20
17-Dec-20
17-Dec-20
17-Dec-20
5-Jan-21
2-Feb-21
23-Mar-21
7-May-21
30-Jun-21
2020
Shares
79,622,263
Shares
66,932,951
500,000
8,255,172
434,140
344,828
155,172
3,000,000
-
79,622,263
50,000
26,541,959
950,000
3,000,000
1,173,402
94,625
37,500
7,813
13,999,998
344,476
51,134
12,500
500,000
28,000
28,571,429
250,000
586
134
2,778
7,142,857
150,000
12
3,334
266,667
14,063
-
162,815,530
2021
$
2020
$
95,402,178
82,506,939
Issue price
$
$0.710
$0.290
$0.290
$0.290
$0.290
$0.140
$0.092
$0.075
$0.120
$0.149
$0.120
$0.120
$0.350
$0.075
$0.075
$0.103
$0.120
$0.075
$0.120
$0.120
$0.280
$0.275
$0.120
$0.120
$0.120
$0.280
$0.275
$0.120
$0.120
$0.120
$0.075
79,276,500
355,000
2,394,000
125,900
100,000
45,000
420,000
(209,461)
82,506,939
4,600
1,990,647
114,000
446,473
140,808
11,355
13,125
586
1,050,000
35,484
6,136
938
60,000
3,360
8,000,000
68,750
70
16
334
2,000,000
41,250
1
400
32,000
1,055
(1,126,148)
95,402,178
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to
the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the company does not
have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall
have one vote.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
20 Equity - issued capital (continued)
b) Unlisted options issued
At 1 July 2019
- Options which expired unexercised
- Options issued under the LTIP
- Options cancelled on failure to meet vesting conditions
At the end of the reporting period - 30 June 2020
At 1 July 2020
- Options which expired unexercised
- Options issued under the LTIP
- Options exercised
- Options cancelled on failure to meet vesting conditions
At the end of the reporting period - 30 June 2021
c) Listed options issued
At 1 July 2020
- Options issued
- Options exercised
- Options which expired unexercised
At the end of the reporting period - 30 June 2021
d ) Performance rights issued
At 1 July 2019
- Performance rights issued
- Performance rights exercised
At the end of the reporting period - 30 June 2020
At 1 July 2020
- Performance rights issued
- Performance rights exercised
At the end of the reporting period - 30 June 2021
Options
3,642,500
(522,188)
785,127
(76,872)
3,828,567
3,828,567
(3,254,268)
1,460,538
(34,376)
(254,472)
1,745,989
-
25,361,522
(6,070,672)
-
19,290,850
Performance
rights
500,000
800,000
(500,000)
800,000
800,000
500,000
(400,000)
900,000
Refer to note 31 for share based payments in the current period.
Capital risk management
The Board controls the capital of the consolidated entity in order to maintain a sustainable debt to equity ratio, generate long-
term shareholder value and ensure that the consolidated entity can fund its operations and continue as a going concern. The
consolidated entity’s debt and capital includes ordinary share capital and financial liabilities, supported by financial assets. There
are no externally imposed capital requirements. Management effectively manages the consolidated entity’s capital by assessing
the consolidated entity's financial risks and adjusting its capital structure in response to changes in these risks and in the market.
These responses include the management of debt levels, distributions to shareholders and share issues.
There have been no changes in the strategy adopted by management to control the capital of the consolidated entity since the
prior year.
Accounting Policy - Issued capital
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a
deduction, net of tax, from the proceeds.
64
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Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
21 Equity - reserves
Share based payments reserve
Contingent consideration equity reserve
Foreign currency translation reserve
Consolidated
2021
$
454,814
1,320,000
(1,909)
1,772,905
2020
$
494,874
1,320,000
-
1,814,874
Contingent consideration equity reserve
The reserve records contingent equity consideration for the acquisition of the Asia Pacific distribution rights for the AngelMed
Guardian System (refer to Note 10). The contingent consideration is made up of both cash payments (refer to Note 14) and equity
issues. The equity contingent consideration component meets the definition of an equity as it is expected to be settled in a fixed
number of shares.
Movement in reserves
Movement in each class of reserve during the current and previous financial year are set out below:
Balance at 30 June 2019
Share based payments
Removing prior year expired options
Cancelled options failing vesting conditions
Options exercised
Performance rights exercised
Contingent equity consideration
Reclassification - transfer to accumulated losses
Balance at 30 June 2020
Share based payments
Removing prior year expired options
Cancelled options failing vesting conditions
Options exercised
Performance rights exercised
Contingent equity consideration
Movement in functional currency of foreign operations
Contingent
consideration
equity reserve
$
-
-
-
-
-
-
1,320,000
-
1,320,000
-
-
-
-
-
-
-
Share based
payments
reserve
$
841,966
183,484
(175,576)
-
-
(355,000)
-
-
494,874
426,771
(311,775)
(18,242)
(26,814)
(110,000)
-
-
Other
reserves
$
(31,529)
-
-
-
-
-
-
31,529
-
-
-
-
-
-
(1,909)
Total
Reserves
$
810,437
183,484
(175,576)
-
-
(355,000)
1,320,000
31,529
1,814,874
426,771
(311,775)
(18,242)
(26,814)
(110,000)
-
(1,909)
Balance at 30 June 2021
1,320,000
454,814
(1,909)
1,772,905
Accounting Policy - Equity reserves
Share based payments reserve
The share based payments reserve records items recognised as expenses on valuation of employee share options and performance rights.
Contingent consideration equity reserve
The contingent consideration equity reserve is measured based on the share price and number of shares to be issued under the tranche payment
and the probability of meeting the required milestones on acquisition date. Equity is not subsequently remeasured.
Foreign currency translation reserve
The foreign currency translation reserve is used to recognise increments and decrements in the fair value of foreign currency through other
comprehensive income.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
22 Equity - accumulated losses
Accumulated losses at the beginning of the financial year
Loss after income tax expense for the year
Transfer from options reserve to account for exercised options
Transfer from options reserve to account for expired options
Transfer from financial assets reserve to account for change in accounting policy
Accumulated losses at the end of the financial year
23 Reconciliation of loss after income tax to net cash from operating activities
Total comprehensive loss for year
Adjustments for:
Effects of exchange rate changes on cash and cash equivalents
Income tax expense / (benefit)
Debt extinguishment loss
Depreciation and amortisation
Gain/(Loss) on contingent consideration liability
Gain/(Loss) on financial instruments at fair value through profit or loss
Impairment of goodwill
Impairment of plant and equipment
Impairment of receivables
Non-cash finance charges
Services rendered for equity
Share based payments
Directors and consultant fees paid by issue of ordinary shares
Unrealised foreign exchange (Gain)/Loss
Unwinding of the discount on provisions
Interest on convertible note
Interest received
Interest and other finance costs paid
Changes in operating assets and liabilities:
Decrease/(increase) in trade and other receivables
Decrease/(increase) in contract assets
Decrease/(increase) in prepayments
Decrease/(increase) in inventory
Decrease/(increase) in other assets
Increase/(decrease) in trade and other payables
Increase/(decrease) in contract liabilities
Increase/(decrease) in provisions
Increase/(decrease) in other liabilities
Net cash from operating activities
66
49
50
2021
$
(82,025,843)
(9,778,693)
9,089
330,017
-
(91,465,430)
2020
$
(78,950,429)
(3,219,461)
175,576
(31,529)
(82,025,843)
2021
$
2020
$
(9,780,602)
(3,219,461)
25
-
-
2,446,900
190,486
69,825
1,269,400
-
(94,602)
257,403
(249,999)
426,771
35,484
79,537
(838)
(6,875)
(15,328)
943,605
2,358,308
(408,712)
(38,204)
(11,281)
(66,834)
282,292
310,709
121,223
(51,938)
(1,933,245)
-
346,727
1,063,586
1,160,581
85,994
(927,303)
-
201,652
133,091
166,715
(812,500)
183,484
45,000
(280,938)
9,355
-
(11,875)
1,131,485
429,095
169,684
31,123
-
(26,004)
(763,765)
655,046
32,274
-
(196,954)
67
Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
24 Financial Instruments
Financial risk management objectives
The entity's activities expose it to a variety of financial risks: market risk (consisting of interest rate risk), credit risk and liquidity risk. The
consolidated entity's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential
adverse effects on the financial performance of the consolidated entity.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the consolidated entity.
The consolidated entity has a strict code of credit, including obtaining agency credit information, confirming references and setting appropriate
credit limits. The consolidated entity obtains guarantees where appropriate to mitigate credit risk. Receivables balances are in general
unsecured and non-interest-bearing. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying
amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial
statements. The consolidated entity does not hold any collateral.
Market risk
Interest rate risk
The consolidated entity's main interest rate risk arises from long-term borrowings. Borrowings obtained at variable rates expose the
consolidated entity to interest rate risk. Borrowings obtained at fixed rates expose the consolidated entity to fair value risk. As at 30 June 2021
all borrowings were at fixed rates.
The consolidated entity's shareholder loans outstanding, totalling $2,250,000 (2020: $2,750,000), are interest only loans. Monthly cash outlays
of $11,250 (2020: $13,750) are required to service the interest payments. As at 30 June 2021, no repayments on the loans were due until 17
March 2022. Subsequent to the end of the financial year, repayments on the loans were extended to 31 December 2022.
Price risk
The consolidated entity is exposed to equity securities price risk arising from investments held by the consolidated entity and classified on the
Statement of Financial Position as fair value through profit or loss of $2,893,492 (2020: $2,234,704).
Sensitivity Analysis
At reporting date, if equity prices had been 10% lower/higher, profit or loss before income tax of the consolidated entity would have
decreased/increased by $256,530 (2020: $223,470).
The following investments constitute 5% or more of the consolidated entity's equity portfolio:
Company
2021
Angel Medical Systems, Inc.
Cyban Pty Ltd
Gyder Surgical Pty Ltd
Company
2020
Angel Medical Systems, Inc.
Cyban Pty Ltd
Gyder Surgical Pty Ltd
Fair Value ($)
1,330,182
400,050
835,071
Fair Value ($)
1,625,000
200,010
379,470
%
51.2%
15.4%
32.1%
%
72.7%
9.0%
17.0%
Liquidity risk
Vigilant liquidity risk management requires the consolidated entity to maintain sufficient liquid assets (mainly cash and cash equivalents) and
available borrowing facilities to be able to pay debts as and when they become due and payable.
The consolidated entity manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously
monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.
The shareholder loan facilities have been fully drawn down as at the reporting date.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
24 Financial Instruments (continued)
2021
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Accrued liabilities
Weighted
average
interest rate
%
1 year or less
Between 1 and
2 years
Between 2 and
5 years
Over 5 years
$
$
$
$
Remaining
contractual
maturities
$
346,322
260,208
922,863
-
-
-
-
-
-
-
-
-
346,322
260,208
922,863
Interest-bearing - fixed rate
Pure Asset Management loan
Shareholder loans
Total non-derivatives
10.00%
0.00%
-
1,000,000
2,529,393
-
1,250,000
1,250,000
-
-
-
-
-
-
-
2,250,000
3,779,393
Derivatives
Warrants
Total derivatives
2020
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Accrued liabilities
770,910
770,910
-
-
-
-
-
-
770,910
770,910
Weighted
average
interest rate
%
1 year or less
Between 1 and
2 years
Between 2 and
5 years
Over 5 years
$
$
$
$
Remaining
contractual
maturities
$
684,371
363,619
199,111
-
-
-
-
-
-
-
-
-
684,371
363,619
199,111
Interest-bearing - fixed rate
Pure Asset Management loan
Shareholder loans
Total non-derivatives
10.00%
6.00%
Derivatives
Warrants
Total derivatives
250,000
-
1,497,101
-
1,000,000
1,000,000
3,250,000
1,750,000
5,000,000
-
-
-
3,500,000
2,750,000
7,497,101
450,782
450,782
-
-
-
-
-
-
450,782
450,782
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed above.
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
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Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
Accounting Policy - Financial instruments
Recognition and Initial Measurement
Financial assets and financial liabilities are recognised when the consolidated entity becomes a party to the contractual provisions to the
instrument. For financial assets, this is equivalent to the date that the consolidated entity commits itself to either the purchase or sale of the
asset (i.e. trade date accounting is adopted). Financial instruments are initially measured at fair value plus transaction costs except where the
instrument is classified ‘at fair value through profit or loss’ in which case transaction costs are expensed to profit or loss immediately.
Classification and Subsequent Measurement
Financial instruments are subsequently measured at fair value, amortised cost using the effective interest method, or cost. Amortised cost is
calculated as the amount at which the financial asset or financial liability is measured at initial recognition less principal repayments and any
reduction for impairment, and adjusted for any cumulative amortisation of the difference between that initial amount and the maturity amount
calculated using the effective interest method.
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to determine the fair value for
all unlisted securities, including recent arm’s length transactions, reference to similar instruments and option pricing models.
The effective interest method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that
discounts estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) over the expected life
(or when this cannot be reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or
financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying amount with a consequential
recognition of an income or expense item in profit or loss.
The consolidated entity does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements
of Accounting Standards specifically applicable to financial instruments.
(i) Financial assets at fair value through profit or loss
Financial assets are classified at “fair value through profit or loss” when they are held for trading for the purpose of short-term profit taking,
derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance
evaluation where a company of financial assets is managed by key management personnel on a fair value basis in accordance with a
documented risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying amount
being included in profit or loss.
(ii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are
subsequently measured at amortised cost. Loans and receivables are included in current assets, where they are expected to mature within 12
months after the end of the reporting period.
(iii) Financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income are held within a business model whose objective is achieved by both
collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash
flows that are solely payments of principal and interest on the principal amount outstanding.
They are subsequently measured at fair value with any measurements other than impairment losses and foreign exchange gains and losses
recognised in other comprehensive income. When the financial asset is derecognised, the cumulative gain or loss pertaining to that asset
previously recognised in other comprehensive income is reclassified into profit or loss.
Financial assets a fair value through other comprehensive income are classified as non-current assets when they are expected to be sold after 12
months from the end of the reporting period.
(iv) Financial Liabilities
Non-derivative financial liabilities other than financial guarantees are subsequently measured at amortised cost. Gains or losses are recognised
in profit or loss through the amortisation process and when the financial liability is derecognised.
Impairment
At the end of each reporting period, the consolidated entity assesses whether there is objective evidence that a financial asset has been
impaired. A financial asset or a group of financial assets is deemed to be impaired if, and only if, there is objective evidence of impairment as a
result of one or more events (a “loss event”) having occurred, which has an impact on the estimated future cash flows of the financial asset(s).
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
25 Key Management Personnel
Compensation
The aggregate compensation made to directors and other members of key management personnel (KMP) of the consolidated entity is set out
below:
Short-term employee benefits
Fees paid to director
Post-employment benefits
Long-term benefits
Share-based payments:
- Expensed during the year
Consolidated
2021
$
409,887
82,536
39,435
2020
$
497,444
228,436
50,128
5,014
5,886
157,518
694,390
148,431
930,324
Further information in relation to remuneration paid or payable to each member of the consolidated entity's KMP can be found in the Director's
Remuneration Report.
26 Auditors remuneration
During the financial year the following fees were paid or payable for services provided by Grant Thornton Audit Pty Ltd, the auditor of the
company, its network firms and unrelated firms:
Audit services - Grant Thornton Audit Pty Ltd
Audit or review of the financial statements GT
Tax Services - Grant Thornton Australia Limited
Other services
27 Related party transactions
Parent entity
Hydrix Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 29.
Consolidated
2021
$
130,000
130,000
2020
$
60,000
60,000
Consolidated
2021
$
35,885
35,885
2020
$
-
-
Key management personnel
Disclosures relating to key management personnel are set out in note 25 and the remuneration report included in the director's report.
Transactions with related parties
Loans received from shareholders
Loans repaid to shareholders
Interest expenses on loans from shareholders
2021
$
Related Party
-
500,000
153,759
2020
$
Related Party
1,544,717
3,000,000
335,052
Receivable from and payable to related parties
There were no receivables from / payables to related parties as at reporting date (30 June 2020: nil).
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Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
27 Related party transactions (continued)
Loans to/from related parties
Loans from shareholders
Consolidated
2021
$
2020
$
2,250,000
2,750,000
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates. Terms of the loans are disclosed in note 17.
28 Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
(Loss) after income tax
Total comprehensive income
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued Capital
Reserves
Accumulated losses
Total Equity
Parent
2021
$
2020
$
(2,363,045)
(2,274,906)
(2,363,045)
(2,274,906)
Parent
2021
$
2020
$
6,057,074
1,176,246
21,683,145
14,322,931
1,031,911
763,656
3,290,393
6,761,419
95,402,178
1,774,814
(78,784,240)
18,392,752
82,506,939
1,814,874
(76,760,301)
7,561,512
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity, and the subsidiaries are not a party to a deed of cross guarantee.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2021 (2020: nil)
Capital commitments - Plant and equipment
The parent entity had no capital commitments for plant and equipment as at 30 June 2021 and 30 June 2020.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in note 1.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
29 Interests in subsidiaries
29 Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following wholly-owned subsidiaries in accordance
with the accounting policy described in note 1:
The consolidated financial statements incorporate the assets, liabilities and results of the following wholly-owned subsidiaries in accordance
with the accounting policy described in note 1:
Name
Name
Hydrix Services Pty Ltd
Hydrix Ventures Pty Ltd
Hydrix Medical Pty Ltd
Hydrix Medical Pte Ltd
Hydrix Services Pty Ltd
Hydrix Ventures Pty Ltd
Hydrix Medical Pty Ltd
Hydrix Medical Pte Ltd
Principal place of
business / Country
of incorporation
Australia
Australia
Australia
Singapore
Principal place of
business / Country
2021
of incorporation
%
Australia
100%
Australia
100%
Australia
100%
Singapore
100%
Ownership interest
2021
%
100%
100%
100%
100%
2020
%
100%
100%
100%
100%
2020
%
100%
100%
100%
100%
Ownership interest
30 Earnings per share
30 Earnings per share
Consolidated
Consolidated
Loss after income tax attributable to the owners of Hydrix Limited
Loss after income tax attributable to the owners of Hydrix Limited
2021
$
(9,778,693)
2021
$
2020
$
(9,778,693)
(3,219,461)
2020
$
(3,219,461)
Weighted average number of ordinary shares used in calculating basic earnings per share
Weighted average number of ordinary shares used in calculating basic earnings per share
Anti-dilutive shares excluded from weighted average number of ordinary shares:
Options over ordinary shares
Warrant shares
Contingent equity consideration
Anti-dilutive shares excluded from weighted average number of ordinary shares:
Options over ordinary shares
Warrant shares
Contingent equity consideration
Number
Number
Number
Number
142,927,338
142,927,338
74,014,724
74,014,724
21,036,839
8,000,000
12,000,000
21,036,839
8,000,000
12,000,000
3,828,567
8,000,000
12,000,000
3,828,567
8,000,000
12,000,000
Weighted average number of ordinary shares used in calculating diluted earnings per share
Weighted average number of ordinary shares used in calculating diluted earnings per share
142,927,338
142,927,338
74,014,724
74,014,724
Basic and diluted loss per share
Basic and diluted loss per share
Cents
(6.84)
Cents
Cents
(6.84)
(4.35)
Cents
(4.35)
In addition to the 1,745,989 non-quoted options issued under the LTIP (refer to Note 31) the following HYDO options were in existence during
the year:
In addition to the 1,745,989 non-quoted options issued under the LTIP (refer to Note 31) the following HYDO options were in existence during
the year:
Grant date
30-Jul-20
31-Jul-20
18-Sep-20
Grant date
Expiry date
30-Jul-20
31-Jul-22
31-Jul-20
31-Jul-22
18-Sep-20
31-Jul-22
Expiry date
Exercise price
31-Jul-22
$0.120
31-Jul-22
$0.120
31-Jul-22
$0.120
Balance at the
start of the
Exercise price
year
$0.120
$0.120
$0.120
-
-
-
-
Balance at the
start of the
year
Options
granted
-
8,847,531
-
11,847,325
-
4,666,666
-
25,361,522
Options
Options
granted
exercised
8,847,531
11,847,325
4,666,666
25,361,522
3,070,672
3,000,000
-
6,070,672
Options
exercised
Options
expired/
forfeited
3,070,672
3,000,000
-
6,070,672
-
-
-
-
Options
expired/
Balance at the
forfeited
end of the year
5,776,859
8,847,325
4,666,666
19,290,850
-
-
-
-
Balance at the
end of the year
5,776,859
8,847,325
4,666,666
19,290,850
During July 2020 20,694,856 options were issued under the Entitlement and Underwriter Offer. On 18 September 2020 a further 4,666,666
During July 2020 20,694,856 options were issued under the Entitlement and Underwriter Offer. On 18 September 2020 a further 4,666,666
options were issued under the Placement Offer. These options can be transferred and are quoted on the ASX (ASX: HYDO).
options were issued under the Placement Offer. These options can be transferred and are quoted on the ASX (ASX: HYDO).
Accounting Policy - Earnings per Share
Accounting Policy - Earnings per Share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Hydrix Limited, excluding any costs of servicing equity
other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus
elements in ordinary shares issued during the financial year.
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Hydrix Limited, excluding any costs of servicing equity
other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus
elements in ordinary shares issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax
effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares
assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax
effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of shares
assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
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Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
31 Share-based payments
On 31 July 2020 3,000,000 HYDO options with a fair value of $86,473 were granted to the lead underwriter of the Entitlement Offer. On 19
September 2020 344,476 shares were issued to Mr Paul Kelly in lieu of cash payments for fees at an issue price of $0.1030 per share and a total
fair value of $35,484. On 6th November 2020 250,000 shares were issued to key management personnel with a total fair value of $68,750. A
further issue of 150,000 shares with a total fair value of $41,250 was made to key management personnel on 17 December 2020 as identified in
the issued capital disclosure (refer to note 20).
Recognised share-based payment expenses
The expense recognised from employee services received during the year is shown in the table below:
Expenses arising from equity-settled share-based payment transactions
Consolidated
2021
$
426,771
2020
$
183,484
Types of share-based payment plan
Employee Share Option Plan, ‘ESOP’
A Long Term Incentive Plan (LTIP) has been established and approved by shareholders where the company may, at the discretion of the Board,
grant options over the ordinary shares of Hydrix Limited to Directors, Executives, contractors and employees of the consolidated entity. The
exercise of the options are subject to time-based and performance-based vesting conditions. The options cannot be transferred and will not be
quoted on the ASX.
The following non-quoted options were in existence during the 2021 financial year.
Grant date
7-Aug-18
9-Nov-18
9-Mar-20
8-Sep-20
2-Oct-20
Expiry date
31-Jul-20
31-Jul-20
30-Jun-25
30-Jun-25
30-Jun-25
Exercise price
$0.800
$0.800
$0.290
$0.075
$0.075
Balance at the
start of the
year
2,250,000
875,000
703,567
-
-
3,828,567
Options
granted
-
-
-
878,038
582,500
1,460,538
Options
exercised
-
-
-
7,813
26,563
34,376
Options
expired
2,250,000
875,000
168,252
215,488
-
3,508,740
Balance at the
end of the year
-
-
535,315
654,737
555,937
1,745,989
The options issued under the LTIP vest subject to time-based and performance-based vesting conditions, including the employee remaining in
the employ of the consolidated entity during the performance period and satisfaction of individual KPI's.
Weighted average remaining contractual life
The weighted average remaining contractual life for the share options outstanding as at 30 June 2021 is 4 years (2020: 1 year)
Range of exercise price
The range of exercise prices for options outstanding at end of the year was $0.075 - $0.29 (2020: $0.29 - $0.80).
The following performance rights were in existence during the 2021 financial year.
Grant date
17-Dec-19
17-Dec-19
17-Dec-19
17-Dec-19
17-Dec-20
17-Dec-20
Vesting date
30-Jun-20
30-Jun-20
30-Jun-21
30-Jun-21
30-Jun-21
30-Jun-22
Exercise price
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
Fair value at
grant date
$0.26
$0.26
$0.28
$0.28
$0.26
$0.26
Balance at the
start of the
year
250,000
150,000
250,000
150,000
-
-
800,000
Performance
rights granted
-
-
-
-
250,000
250,000
500,000
Performance
rights exercised
250,000
150,000
-
-
-
-
400,000
Balance at the
end of the year
-
-
250,000
150,000
250,000
250,000
900,000
The performance rights vest subject to satisfaction of prescribed vesting conditions including financial, operational, corporate governance,
strategic planning and business development objectives set by the Board.
Hydrix Limited
Notes accompanying the financial statements
For the year ended 30 June 2021
31 Share-based payments (continued)
Weighted average remaining contractual life
The weighted average remaining contractual life for the performance rights outstanding as at 30 June 2021 is 1 year and three months (2020: 1
year and six months).
Weighted average fair value
The weighted average fair value of performance rights granted during the year was $0.275 (2020: $0.275).
For movements in share options during the prior year, refer to note 20.
For the performance rights granted during the current financial year, the fair value at the grant date was equal to the share price.
Accounting Policy - Share-based payments
Equity-settled and cash-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of
services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the
share price.
The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined using either the
Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the
share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the
term of the option, together with non-vesting conditions that do not determine whether the consolidated entity receives the services that entitle
the employees to receive payment. No account is taken of any other vesting conditions.
The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting period. The
cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate of the number of awards that
are likely to vest and the expired portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative amount
calculated at each reporting date less amounts already recognised in previous periods.
Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions are considered to
vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An additional expense is
recognised, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit
as at the date of modification.
If the non-vesting condition is within the control of the consolidated entity or employee, the failure to satisfy the condition is treated as a
cancellation. If the condition is not within the control of the consolidated entity or employee and is not satisfied during the vesting period, any
remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognised
immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award is treated as if they were a
modification.
32 Contingent liabilities
The consolidated entity had no contingent liabilities as at 30 June 2021 (2020: nil).
74
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Hydrix annual report 2021 Hydrix annual report 2021
Notes accompanying the
financial statements
Directors'
declaration
Hydrix Limited
Directors' Declaration
30 June 2021
In the directors' opinion:
-
-
-
-
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting
Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;
the attached financial statements and notes comply with International Financial Reporting Standards as issued
by the International Accounting Standards Board as described in note 1 to the financial statements;
the attached financial statements and notes give a true and fair view of the consolidated entity's financial
position as at 30 June 2021 and of its performance for the financial year ended on that date;
there are reasonable grounds to believe that the company will be able to pay its debts as and when they
become due and payable; and
The directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act
2001.
Mr Gavin Coote
Executive Chairman
Dated: 31 August 2021
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Hydrix LimitedNotes accompanying the financial statementsFor the year ended 30 June 202133Events after the reporting periodOn 11 August 2021 the consolidated entity established Hydrix Medical New Zealand Limited as a wholly owned subsidiary of Hydrix Medical Pty Ltd.On 2 August 2021 the consolidated entity announced that Angel Medical Systems had completed the first commercial implantation in the USA of the Guardian device. On 27 August 2021 the consolidated entity deferred the 17 March 2022 maturity of the $1,000,000 unsecured shareholder loan to 31 December 2022.During July and August 2021, the Victorian Government made multiple public health and safety directions that required the consolidated entity to reduce its on-site operations due to the COVID-19 pandemic. The consolidated entity's business remains operational after complying with the additional restrictions, with most employees having already transitioned to working from home where possible. Where work is permitted on-site, the consolidated entity continues to operate with processes and protocols in place to support the safety and wellbeing of our 59Hydrix annual report 2021 Hydrix annual report 2021
Independent
auditor's report
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
In addition to the matter described in the Material uncertainty related to going concern section, we have determined the
matters described below to be the key audit matters to be communicated in our report.
Key audit matter
How our audit addressed the key audit matter
Carrying value of intangible assets and right-of use assets – Note 10 and Note 19
At 30 June 2021, the carrying values of intangible assets is
$4,985,965 (inclusive of goodwill, brand name, distribution
rights, customer relationships and software) and right-of-
assets is $2,076,561.
In accordance with AASB 136 Impairment of Assets, the
Consolidated Entity is required to assess if there are any
indicators of impairment and in respect to goodwill, brand
name, distribution rights, assess if the carrying value of each
Cash Generating Unit (CGU) is in excess of the recoverable
amount of intangible assets.
Our procedures included, amongst others:
Reviewing the value-in-use (VIU) model for goodwill, brand
name and distribution rights for compliance with AASB 136;
Verifying the mathematical accuracy and methodology
appropriateness of the underlying VIU calculations;
Evaluating the cash flow projections by assessing
management's ability to historically forecast by comparing
actual results to previous forecasts;
Assessing key judgements and assumptions and
performed a sensitivity analysis of the inputs in the model;
This area is a key audit matter due to the high level of
management judgement and estimation required to determine
the recoverable amount of the CGU.
Reviewing management’s assessment of the existence of
impairment indicators on other intangible assets and right-
of-use assets during the year;
Revenue recognition – Note 4
For the year ended 30 June 2021, the Consolidated Entity
recognised revenue of $7,445,221 (2020: $14,934,225) from
variable and fixed price service contracts. Revenue is
recognised in accordance with AASB 15 Revenue from
Contracts with Customers.
The process to measure the amount of revenue to recognise
in the financial statements, including the identification of
performance obligations, evaluation of stand-alone selling
prices and timing of revenue recognition, involves significant
management judgement.
This area is a key audit matter due to the complexity and
judgement associated with the recognition of revenue.
Reviewing management’s assessment of the estimated
useful life of customer relationships and software; and
Assessing the adequacy of disclosures for compliance in
accordance with the Australian Accounting Standards.
Our procedures included, amongst others:
Gaining an understanding of revenue trends for significant
revenue categories through analytical review;
Testing a sample of revenue contracts to supporting
documentation and assessing whether revenue recognition
is in compliance with AASB 15;
Testing the accuracy of revenue recognition where
consideration is in the form of equity issued in the
customer’s share capital;
Reviewing the progress of fixed price contracts to critically
assess management’s estimates of project stage of
completion and progress against budget; and
Assessing the adequacy of disclosures for compliance in
accordance with the Australian Accounting Standards.
Information other than the financial report and auditor’s report thereon
The Directors are responsible for the other information. The other information comprises the information included in the
Consolidated Entity’s annual report for the year ended 30 June 2021, but does not include the financial report and our auditor’s
report thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of assurance
conclusion thereon.
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Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389 ‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited. Liability limited by a scheme approved under Professional Standards Legislation. www.grantthornton.com.au Collins Square, Tower 5 727 Collins Street Melbourne VIC 3008 Correspondence to: GPO Box 4736 Melbourne VIC 3001 T +61 3 8320 2222 E info.vic@au.gt.com W www.grantthornton.com.au Independent Auditor’s Report To the Members of Hydrix Limited Report on the audit of the financial report Opinion We have audited the financial report of Hydrix Limited (the Company) and its subsidiaries (the Consolidated Entity), which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated statement of profit or loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies, and the Directors’ declaration. In our opinion, the accompanying financial report of the Consolidated Entity is in accordance with the Corporations Act 2001, including: a giving a true and fair view of the Consolidated Entity’s financial position as at 30 June 2021 and of its performance for the year ended on that date; and b complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Consolidated Entity in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Material uncertainty related to going concern We draw attention to Note 1 in the financial statements, which indicates that the Consolidated Entity incurred a net loss before tax of $9,778,693 and reported cash used in operations of $1,933,245 during the year ended 30 June 2021. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast doubt on the Consolidated Entity’s ability to continue as a going concern. Our opinion is not modified in respect of this matter. Hydrix annual report 2021 Hydrix annual report 2021
Independent
auditor's report
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the financial report
The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in
accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors
determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the Consolidated Entity’s ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting
unless the Directors either intend to liquidate the Consolidated Entity or to cease operations, or have no realistic alternative but
to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing
Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance
Standards Board website at: https://www.auasb.gov.au/auditors_responsibilites/ar1_2020.pdf. This description forms part of
our auditor’s report.
Report on the remuneration report
Opinion on the remuneration report
We have audited the Remuneration Report included in pages 11 to 15 of the Directors’ report for the year ended 30 June
2021.
In our opinion, the Remuneration Report of Hydrix Limited, for the year ended 30 June 2021 complies with section 300A
of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance
with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report,
based on our audit conducted in accordance with Australian Auditing Standards.
Grant Thornton Audit Pty Ltd
Chartered Accountants
A C Pitts
Partner – Audit & Assurance
Melbourne, 31 August 2021
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Hydrix annual report 2021 Hydrix annual report 2021
Additional securities
exchange information
In accordance with ASX Listing Rule 4.10, the Company provides the following information to shareholders not elsewhere disclosed in
this Annual Report. The information provided is current as at 1 October 2021 (Reporting Date).
CORPORATE GOVERNANCE STATEMENT
The Company’s Directors and management are committed to conducting the Group’s business in an ethical manner and in
accordance with the highest standards of corporate governance. The Company has adopted and substantially complies with the
ASX Corporate Governance Principles and Recommendations (Fourth Edition) (Recommendations) to the extent appropriate to
the size and nature of the Group’s operations.
The Company has prepared a statement which sets out the corporate governance practices that were in operation throughout
the financial year for the Company, identifies any Recommendations that have not been followed, and provides reasons for not
following such Recommendations (Corporate Governance Statement).
In accordance with ASX Listing Rules 4.10.3 and 4.7.4, the Corporate Governance Statement will be available for review on the
Company’s website (https://www.hydrix.com/about/corporate-governance), and will be lodged together with an Appendix 4G with
ASX at the same time that this Annual Report is lodged with ASX.
The Appendix 4G will particularise each Recommendation that needs to be reported against by the Company, and will provide
shareholders with information as to where relevant governance disclosures can be found.
The Company’s corporate governance policies and charters are all available on its website at https://www.hydrix.com/about/
corporate-governance.
SUBSTANTIAL HOLDERS
As at the Reporting Date, the names of the substantial holders of the Company and the number of ordinary voting shares in which
those substantial holders and their associates have a relevant interest (based on the Company’s share register as at the Reporting
Date and/or substantial holding notices given to the Company) are as follows:
Holder of
Equity Securities
Class of Equity
Securities
Number of Equity
Securities held
% of total issued
securities capital in
relevant class
John W King Nominees Pty Ltd
Ordinary shares
17,639,345
10.75%
John King*
Julie King**
Ordinary shares
17,939,811
10.93%
Ordinary shares
17,639,345
10.75%
National Nominees Pty Limited
Ordinary shares
9,790,737
5.96%
* John King has a relevant interest in the shares held by:
- King Family Foundation Ltd
- John W King Nominees Pty Ltd
** Julie King has a relevant interest in the shares held by John W King Nominees Pty Ltd
NUMBER OF HOLDERS
As at the Reporting Date, the number of holders in each class of equity securities:
Class of Equity Securities
Fully paid ordinary shares
Listed options exercisable at $0.12 each, expiring on 31 July 2022
LTIP Options exercisable at $0.075 each, expiring on 30 June 2025
LTIP Options exercisable at $0.029 each, expiring on 30 June 2025
Warrants
LTIP Performance rights
Number of holders
4,255
490
46
32
1
2
VOTING RIGHTS OF EQUITY SECURITIES
The only class of equity securities on issue in the Company which carries voting rights is ordinary shares.
As at the Reporting Date, there were 4,255 holders of a total of 164,167,299 ordinary shares of the Company.
At a general meeting of The Company, every holder of ordinary shares present in person or by proxy, attorney or representative
has one vote on a show of hands and on a poll, one vote for each ordinary share held. On a poll, every member (or his or her proxy,
attorney or representative) is entitled to vote for each fully paid share held and in respect of each partly paid share, is entitled to
a fraction of a vote equivalent to the proportion which the amount paid up (not credited) on that partly paid share bears to the
total amounts paid and payable (excluding amounts credited) on that share. Amounts paid in advance of a call are ignored when
calculating the proportion.
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Hydrix annual report 2021 Hydrix annual report 2021 Additional securities
exchange information
DISTRIBUTION OF HOLDERS OF EQUITY SECURITIES
The distribution of holders of equity securities on issue in the Company as at the Reporting Date is as follows:
Distribution of ordinary shareholders
Distribution of performance rights holders
Holdings Ranges
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Totals
Holders
Total Units
1,276
1,218
528
995
238
611,859
3,267,998
4,194,518
32,143,846
123,949,078
%
0.37
1.99
2.56
19.58
75.50
Holdings Ranges
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – 999,999,999
4,255
164,167,299
100.00
Totals
Distribution of listed option holders
Distribution of warrant holders
Holders
Total Units
%
0.31
2.33
2.50
12.93
81.94
Holdings Ranges
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – 999,999,999
19,592,361
100.00
Totals
Holdings Ranges
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – 999,999,999
Totals
Distribution of unlisted option holders
Holdings Ranges
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – 999,999,999
Totals
84
144
165
65
88
28
490
0
3
10
56
1
70
58,270
441,442
474,145
2,451,975
15,538,249
0
11,741
70,238
1,487,166
134,375
Holders
Total Units
%
0.00
0.69
4.12
87.30
7.89
LESS THAN MARKETABLE PARCELS OF ORDINARY SHARES (UMP SHARES)
The number of holders of less than a marketable parcel of ordinary shares based on the closing market price at the Reporting Date
is as follows:
Total Shares
164,167,299
UMP Shares
UMP Holders
% of issued shares
held by UMP holders
2,652,345
2,227
1.62%
1,703,520
100.00
85
Holders
Total Units
%
-
-
-
-
2
2
-
-
-
-
-
-
-
-
900,000
900,000
100.00
100.00
Holders
Total Units
%
1
-
-
-
-
1
1
-
-
-
-
1
100.00
-
-
-
-
100.00
Hydrix annual report 2021 Hydrix annual report 2021 Additional securities
exchange information
TWENTY LARGEST SHAREHOLDERS
The Company has two classes of quoted securities, being ordinary shares and HYDO options (exercisable at $0.12 each, expiring
on 31 July 2022 (ASX: HYDO)). The names of the 20 largest holders of each quoted class of securities, and the number of securities
and percentage of capital held by each holder is as follows:
Ordinary shares:
Shareholder Name
Balance as at
Reporting Date
%
HYDO options:
Shareholder Name
Balance as at
Reporting Date
%
JOHN W KING NOMINEES PTY LTD
17,639,345
10.745%
CS THIRD NOMINEES PTY LIMITED
2,250,728
11.868%
NATIONAL NOMINEES LIMITED
9,790,737
5.964%
PATAGORANG PTY LIMITED
2,222,222
11.718%
PATAGORANG PTY LIMITED
6,666,666
4.061%
NETHERFIELD INVESTMENTS PTY LTD
1,360,000
7.171%
INVIA CUSTODIAN PTY LIMITED
3,958,333
2.411%
INVIA CUSTODIAN PTY LIMITED
1,111,111
5.859%
INVIA CUSTODIAN PTY LIMITED
3,958,333
2.411%
INVIA CUSTODIAN PTY LIMITED
1,111,111
5.859%
JASPER CAPITAL LTD
3,000,000
1.827%
MADORA VIEW PTY LTD
932,473
4.917%
BNP PARIBAS NOMINEES PTY LTD
2,075,264
1.264%
MR TUDOR JOHN EVANS
MR PETER DAVID RUSSELL & MS DOMINIQUE KAREN DU MAURIER
1,989,494
1.212%
BLUE VALLEY PTY LTD
BEACHRIDGE ADVISORY SERVICES PTY LTD
1,970,385
1.200%
MR BRIAN BAHRAM MAHBOD
PATAGORANG PTY LTD
1,785,714
1.088%
MACKLY PTY LTD
SANDHURST TRUSTEES LTD
1,555,975
0.948%
CONDRON FAMILY PTY LTD
732,000
3.860%
666,667
3.515%
650,000
3.428%
566,667
2.988%
533,334
2.812%
483,334
2.549%
AUSTRALIAN PHILANTHROPIC & SERVICES FOUNDATION P/L
1,367,952
0.833%
MR MOBEEN IQBAL
BNP PARIBAS NOMS PTY LTD
1,352,529
0.824%
MR BILAL AHMAD
FLET SUPERANNUATION PTY LTD
1,207,030
0.735%
LAMPSAC PTY LTD
BRIDGESTAR PTY LTD
1,200,000
0.731%
KIMBRY PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
1,139,989
0.694%
HENSLOW PTY LTD
285,000
1.503%
265,000
1.397%
247,222
1.304%
217,578
1.147%
210,000
1.107%
CITICORP NOMINEES PTY LIMITED
1,139,653
0.694%
SUPER FOR SUNDOWNERS PTY LTD
205,000
1.081%
MEMPHASYS LIMITED
1,000,000
0.609%
BEACHRIDGE ADVISORY SERVICES PTY LTD
182,657
0.963%
Total number of shares of Top 20 Holders
66,322,399
40.399%
Total number of shares of Top 20 Holders
Total Remaining Holders Balance
164,167,299
59.601%
Total Remaining Holders Balance
86
14,527,795
76.607%
18,964,081
23.393%
87
Hydrix annual report 2021 Hydrix annual report 2021 OTHER INFORMATION
The Company is not currently conducting an on-market buy-back.
There are no issues of securities approved for the purposes of item 7 of section 611 of the Corporations Act which have not yet
been completed.
No securities were purchased on-market during the reporting period under or for the purposes of an employee incentive scheme
or to satisfy the entitlements of the holders of options or other rights to acquire securities granted under an employee incentive
scheme.
Additional securities
exchange information
COMPANY SECRETARY
The Company’s secretary is Ms Alyn Tai.
REGISTERED OFFICE
The address and telephone number of the Company’s registered office is:
30 – 32 Compark Circuit
Mulgrave Victoria 3170
Telephone: +61 (0)3 9550 8100
SHARE REGISTRY
The address and telephone number of the Company’s share registry, Boardroom Pty Limited, are:
Grosvenor Place
Level 12, 225 George Street
Sydney NSW 2000
Telephone: 1300 737 760 / +61 (0)2 9290 9600
STOCK EXCHANGE LISTING
The Company’s ordinary shares and HYDO options are quoted on the Australian Securities Exchange (ASX)
(ASX issuer code: HYD).
ESCROW
As at the reporting date, the Company has 3,000,000 ordinary shares on issue which are subject to voluntary escrow until 12
March 2022.
UNQUOTED EQUITY SECURITIES
The number of each class of unquoted equity securities on issue, and the number of holders in each such class, are as follows:
Class of Equity Securities
Number of unquoted
Equity Securities
Number of holders
LTIP Options exercisable at $0.075 each, expiring on 30 June 2022
LTIP Options exercisable at $0.29 each, expiring on 30 June 2025
Warrant
LTIP Performance rights
1,122,799
513,439
1
900,000
46
32
1
2
The Warrant is held by Pure Asset Management Pty Ltd ABN 46 616 178 771 in its capacity as trustee for The Income and
Growth Fund. The Warrant was issued to the holder under a loan facility agreement, and is exercisable into 8,000,000
ordinary shares.
All other unquoted equity securities on issue in the Company were issued under the Company’s Long Term Incentive Plan.
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Hydrix annual report 2021 Hydrix annual report 2021 Hydrix Limited
ABN: 84 060 369 048
30-32 Compark Circuit
Mulgrave, Victoria, 3170
Australia
+61 3 9550 8100
hydrix.com