2020 Annual Report
Annual Report
IMEXHS™ is the place where innovation and technology meet medical experience
2020 Why IMEXHS®?
Our purpose is to democratise access to high-tech imaging management platforms
with advanced clinical applications, user-friendly software and AI.
Affordable next-gen
imaging tech
We are a full-service radiology enterprise software
provider with platforms comprising the full suite of
services including Radiology Information Systems
(RIS), workflow management, patient data and
image distribution systems and Picture Archiving
and Communications Systems (PACS). IMEXHS was
founded in 2012 with the goal of bringing high quality
medical imaging to radiologists through modern
technology, while keeping care accessible and
affordable. We are focused on next generation AI
applications and exploring other “ologies” within the
hospital system. Teleradiology is central to IMEXHS’s
approach of providing a multimodal and fully
web-based platform.
IMEXHS® is about Digital
Transformation for a better
future
With a background in neuroradiology and software
engineering,
IMEXHS
is
leading
the digital
transformation of the medical imaging industry by
providing advanced technologies for hospitals and
clinics that are scalable, adaptable, accessible and
can offer seamless interoperability while maintaining
data integrity.
At IMEXHS® we continue to demonstrate that digital
transformation in the health sector is essential to the
evolution of medical practice and to ensuring better
patient outcomes.
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2020 Table of Contents
Chairman’s Letter
Chief Executive Officer’s Report
About Imexhs
What´s to come in software development
Directors' report
Auditor's independence declaration
Statement of profit or loss and other comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Directors' declaration
Independent auditor's report to the members of IMEXHS Limited
Shareholder information
Corporate directory
5
7
10
21
22
36
37
38
39
40
41
72
73
77
79
Certifications
Certifications
“Democratising
access to
high-tech imaging
management
platforms around
the world”
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Chairman’s Letter
based in Sydney. In October, Reena Minhas joined IMEXHS as
Chief Financial Officer and Company Secretary taking over from
Tony Thomas and Peter Webse, and we thank them for their
contribution since the company listed.
As part of our process to improve governance, the Board has
established committees
for Audit and Risk and
for
Remuneration and Nominations, chaired respectively by
Damian Banks and Carlos Palacio.
In July, the company set up a system to allow shareholders with
holdings worth $2,000 or less to sell their shares efficiently. This
also helped the company to reduce costs associated with
servicing smaller holdings.
The company also repaid a loan of $1.0 million to an entity
associated with director Dr Doug Lingard and at the same time
agreed to issue 16,666,667 shares to Dr Lingard’s entity, subject to
Chairman’s
Letter
Dear Shareholder,
The financial year ended 31 December 2020 has been a year of
significant achievement for IMEXHS because of the considerable
progress made at every level of the business as well as in terms of
shareholder approval.
its corporate governance.
One of the key changes in the Board’s composition this year was
the retirement of Howard Digby in April, and the Board thanks
Howard for his service and support since the establishment of
IME as an ASX-listed company.
I was appointed in March 2020 as an independent non-executive
chairman, and Damian Banks was appointed as an independent
non-executive director in May 2020. Damian brings extensive
business experience and has made an important contribution to
the Board's processes and decision-making.
We have sought to have our Australian services and capabilities
The company held an Extraordinary
General Meeting in October at which a
number of matters were approved:
Capital consolidation: by reducing the number of shares
issued based on 1 share for every 50 held. This improved
the attractiveness of the shares to certain institutions and
reduced the scope for buy-sell spread arbitrage.
Approval of a long-term incentive plan, which we expect to
implement in 2021 as we havn’t finalised this yet and the
start of 2021 is almost over.
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Chairman’s Letter
Appointment and removal of an auditor
following a
01
Product Development
competitive process, which allowed us to move the audit
function to Sydney.
Approval of the issue of shares to Dr Lingard’s entity.
02
Organisation Development
03
04
Sales and Marketing
Distribution Network
05
Geographic Expansion
In October, the Company successfully raised $8.3m in capital
through placement, which introduced some new institutions to
the Company’s register. This effort provided the Company with
adequate funding for the journey ahead as we continue to invest in
the development of our world-leading software and expand our
sales distribution capability into new geographies.
In closing, 2020 has marked a very important building block for
the future. Despite the travails of COVID-19, our Company has
prevailed. There is no doubt that some decision-making was
slowed, particularly at larger hospitals as they dealt with more
pressing matters.
I would like to thank our Board members and our management
It is important to mention that, despite travel restrictions out of
team, most ably lead by Dr Arango, for their hard work and
Australia in relation to COVID-19, the Board is working well and
contributions during this unusual and difficult year. I would also
closely with the senior management team. The
level of
like to sincerely thank all our shareholders, both new and
engagement and professionalism of the management team is
longer-term, for their ongoing support.
exemplary. Complexities abound for an ASX-listed company with a
Board—not including its CEO—based in Australia and whose major
operations are in Latin America. Very regular dialogue is important,
as is ongoing improvement of processes and systems. The Board
has an appropriate mix of business and industry skills, as well as
international experience.
While good progress has been made in terms of governance, our
management team has made great progress regarding the
business. I will leave it to Dr. Arango to elaborate, however in my
view we have made notable changes in:
Doug Flynn
Chairman
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2020 Chief Executive Officer’s Report
At the same time, we established a Partners Program to create a
new channel for the distribution of this standardised offering. To
support these distributors, we have produced an online centre
which provides training as well as sales and post-sales support.
Distributors can sign up for one of three fixed packages and receive
discounts based on performance. Aquila in the Cloud will also be
available on online marketplaces and I believe the combination of
these two sales channels will allow us to efficiently scale this
business model.
Aquila in the Cloud is hosted within Microsoft Azure so it can be
rapidly deployed across multiple geographies and has an average
implementation time of just 13 days. At less than 60 days, the sales
cycle, is also about three times shorter than our customised
solutions. At 31 December, we had received 41 orders across eleven
markets which will contribute around $945,000 in ARR and we have
a strong pipeline of opportunities.
With Aquila in the Cloud, we are democratising access to world-class
medical imaging software for an underserved segment that has not
been able to afford comprehensive on-premise solutions. This
innovative offering provides us with a significant opportunity across
all our geographies including the US, where the small to mid-size
segment represents approximately 80% in number of sites, within
an estimate US market size of US$1.5bn. We were pleased to sign
and go live with our first US customer in December.
In August, we announced a global agreement with Vital Images, a
subsidiary of Canon Medical Systems to integrate its advanced
post-processing tools. This is the first time that Vital’s advanced
visualisation system will be available on the cloud and accessible to
IMEXHS’s customers under its subscription model.
Chief Executive
Officer’s Report
The 2020 financial year was an important year for IMEXHS and I
am proud of the progress we have made across a number of key
business areas. However, it has also been a year that was marked
by a global pandemic and I would like to extend our deepest
condolences to those who have been affected by COVID-19,
including families who have lost loved ones. I also wish to
acknowledge and express our gratitude to healthcare workers
around the world who have worked tirelessly to treat and stop the
spread of this virus.
The pandemic has accelerated the demand for affordable and
accessible technology across many different fields including
healthcare. At IMEXHS, it demonstrated the critical nature of our
teleradiology solution and in May, we launched our disruptive
Aquila in the Cloud offering, which is generating strong interest
across our core markets. We developed this new business model
to
leverage the multi-tenancy capabilities of our AQUILA
Radiology solution.
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Chief Executive Officer’s Report
The collaboration with Vital further strengthens our value proposition
and meets our objective of providing customers of all sizes with the best
and most affordable medical imaging solutions. It is also a strong vote of
confidence in IMEXHS, as we were the first company Vital has worked
with in order to provide availability of these tools on the cloud.
During 2020, we made key appointments to the management team
and implemented a new sales structure. We have also made significant
progress in our new markets the USA, Australia and Brazil.
We established the first IMEXHS office in Miami from which we
will initially target the markets of Florida and Texas.
We filled key management positions in the US and Australia.
In Brazil, we received ANVISA certification which means we can
commence operations in Latin America’s largest market.
We were also delighted to receive CE mark registration for our HIRUKO
Essential software suite, which provides us with access to the European
Union, one of the world’s largest RIS / PACS markets which is projected to
be worth approximately US$570m by 2023.
In October, we completed an $8.3m placement which will fund
the next phase of IMEXHS’s growth and has introduced additional
high-quality institutional investors to the register.
The net proceeds from the placement will be used to accelerate
our penetration into new markets via increased investment in sales
and marketing, which will drive digital sales through cloud
marketplaces. It will also allow us to expand our software
development to create the world’s first pathology marketplace
using Alula, and enhance Aquila, our radiology platform. In
addition, we will further build our AI capability and develop other
–ologies or medical verticals.
The placement proceeds, together with the revenue generated by the
business , are expected to fund IMEXHS’s operations through to
monthly run rate EBITDA breakeven by December 2021. The success
of the placement and the fact that it was heavily oversubscribed, is a
strong endorsement of our investment program and growth strategy.
Turning to our 2020 financial performance, revenue of $10.9m
increased by 41% year on year (yoy) and was in line with our guidance
of $10-12m. On a constant currency basis, revenue increased by 59%,
and was underpinned by 29% growth in contracted recurring revenue
to $8.5m. ARR of $10.1m, was 19% higher yoy and 33% higher on a
constant currency basis.
Our revenue was impacted by decreased volumes in key markets as
second waves of COVID-19 resulted in a reduction in non-essential
imaging. This situation has improved since the end of September but
there remains a delay in decision-making by the big hospitals.
However, this is being partly offset by demand at the small to medium
end of the market with strong interest in our Aquila in the Cloud
offering.
IMEXHS had a consolidated loss of $3.6m; with an EBITDA loss of $1.3m
which was a $3.3m improvement over 2019 and an underlying EBITDA
loss of $0.7m which was a $3.8m improvement over the same period.
When excluding the impact of software capitalisation in the period,
underlying EBITDA improvement was $3.0m.
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Chief Executive Officer’s Report
IMEXHS is in a strong financial position with closing cash of $10.8m and net assets of $15.5m at 31 December 2020.
2020 was a year that brought many positive changes to our Company. I would like to take this opportunity to thank the Board for their valuable contribution,
our shareholders for their ongoing support and our entire IMEXHS team for their dedication to ensuring better healthcare outcomes for our customers and
their patients. We are excited about the ongoing remarkable developments at IMEXHS and look forward to sharing the next phase of our journey with you.
I want to share some operational highlights from 2020:
1. AQUILA in the Cloud launched in May 2020 - 41 new
6. First place in the 2020 INGENIO Awards Category:
contracts, 11 markets, A$945k in ARR
Health Success Story
2. Certification received to operate in Brazil and the
European Union
7. IMEXHS team of nearly 200 members worldwide
3. Aquila 3.0 - intuitive interface, improved user
algorithms
experience, advanced tools
8. Stella AI - proprietary artificial
intelligence
4. Project implementation times reduced by 50 %
9. Opened new office in the USA
5. Partners Program adds new distribution channel
technology marketplace
10. Available on
Ingram Micro, world's
largest
Dr. Germán Arango Bonnet
CEO
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About IMEXHS®
About IMEXHS®
Innovative Provider of
End-to-End
Imaging Software
Solutions
Next Generation multi-modality cloud-based Medical
Imaging Software
Scalable SaaS subscription model with more than 227
customers globally
International distribution with more than 15 agreements in
countries including Australia, US, Spain & LATAM
Global RIS/PACS market opportunity of $5.8b with a CAGR of
7.4%
A leading global innovator working in medical imaging and
AI
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About IMEXHS®
Our Global Footprint
USA
Mexico
Spain
Costa Rica
El Salvador
Nicaragua
Honduras
Colombia
Panama
Peru
Ecuador
Chile
Bolivia
Brazil Paraguay
Uruguay
Australia
IMEXHS Currently
Operating
We have never lost ground
+ 95%
customer retention
+ 6M
new studies
per year
+400M
images stored
(anonymised)
+270
sites running
our application
+2,000
specialists using
our application
+ 25
distributors
+ 15
countries
Headquarters
Australia
US
LATAM - Colombia
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About IMEXHS®
Award - Winning
At IMEXHS, we support the organisations that work to
In 2020, we won First place in the 2020 INGENIO
bring our industry together, generating dialogue and
Awards in the Health Success Story category. The
helping to set standards. We are proud when these
INGENIO Awards are the most important awards for
organisations recognise our efforts.
the ICT sector in Colombia.
2013
First place
CEEI Business Innovation Awards
2018
Finalists
IT Business leader, Colciencias
2019
First place
Society for Imaging informatics in
Medicine (SiiM) Hackthon People Choice
2019
Award
Winning Company
Transformation” ANDICOM
First place
Digital Transformation Business Awards, for
“Innovative solutions that enable Digital
2014
Special mention:
IT innovation for Health Care
Ingenuity Awards 2014 Log
2019
Finalists
in the Ingram Micro-Comet Contest
2019
Semifinalist
“Best New Radiology Vendor In the
US”, Minies by Auntminnie.com
2020
Winner
in the category of health success case at
Premios ingenio.
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About IMEXHS®
Enhancing the medical imaging experience,
Enhancing the medical
imaging experience, for patients & doctors
for patients & doctors
A.
Our Value Proposition
IMEXHS™ is the place where innovation and
technology meet medical experience.
Modern platform
Patient centric
Reduce IT infrastructure, system & administration
Regional image exchange workflows
Multi-disciplinary imaging
Shared Applications
100% Web technology
Real-time exchanged networks
Physicians & patients portals
Care coordination
Clinical collaboration
Shared workflows
Dynamic presentation model
Real-time communications & collaborations
ETR embedded workflows
Analytics
Multi-departamental business intelligence
Clinical intelligence
Live dashboards
Predictive analysis
AI enabled
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About IMEXHS®
B. Company Culture
Every project and daily action reflects the values
upon which IMEXHS ™ was founded:
Be
Innovative
Be
Resilient
Be
Ethical
Be
human
Be
Humble
Focus on
Positive Social
Impact
Insist on the
highest of
standards
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About IMEXHS®
C. Development Pillars
We are committed to
delivering high value tools
for the modern healthcare
sector. Nearly one third of
our team works in
software development.
We assist with and
facilitate academic
collaborations, industrial
interactions, and
knowledge transfer:
Alliances with the prestigious universities to
collaborate in the generation of new knowledge and
product
innovation projects
for
the medical
imaging sector.
Identify emerging technological opportunities to
include in our technological stack.
Explore novel approaches to solving complex
clinical problems.
Lead cooperative research initiatives and support
software development projects.
Develop
research projects
to enable
the
development of novel services for the clinical
context.
2020
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About IMEXHS®
Our Team
IMEXHS® is a place for passionate, enthusiastic
and committed individuals to give their best
every day.
We are a young and dynamic group of health,
technology and business specialists committed to
the development of innovative solutions for a
better future.
2020
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About IMEXHS®
A.
IMEXHS Universe -
Enterprise Imaging Solutions
Business intelligence
Post-processing advanced tools
Artificial intelligence Tools
VNA universal web viewer powered by hiruko ™
Radiology Solution. Streamlined Radiology
Workflow Management Solution
Pathology Solution. Advanced workflow management
for pathological processes
Cardiology Solution. Fully integrated cardiology imaging workflow.
The future of cardiology
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About IMEXHS®
Aquila in the Cloud:
a disruptive and
successful new
business model
Aquila in the Cloud (AiC) was launched in May 2020 to improve
41 contracts across 11 markets which are expected to contribute
patient outcomes in imaging diagnosis and treatment. This new
IMEXHS business model leverages the multi-tenancy capabilities
over A$945,000 in Annual Recurring Revenue (ARR).
of AQUILA™ to provide small to medium-sized customers with an
20 AiC distribution partners
affordable and accessible RIS/PACS product.
Hosted within Microsoft Azure, AiC can be rapidly deployed across
multiple geographies, with customers paying a connection and
establishment fee for the software service with ongoing user
charges on a per study basis. Vitrea’s advanced post-processing
tools, provided by Canon Group, are also available to AiC customers.
This provides small to medium-sized customer’s access to
sophisticated advanced imaging tools on a fee per study basis,
helping to reduce overall costs while improving patient outcomes.
IMEXHS’ new standardised AQUILA in the Cloud (AiC) radiology
solution continues to experience strong sales.
Signed first AiC customer in US
Significant US market opportunity as high on-premise costs limit
Access to medical imaging technology for 80% of the market
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About IMEXHS®
Discover AQUILA 3.0:
the future of radiology software
solutions is here.
Intuitive, flexible, and accessible
This improved version offers a renewed design, greater ease of
use and implementation, an improved user experience, and
compatibility with StellA.I (Artificial Intelligence). It can be
purchased as a package (Lite, Pro, Ultimate and Custom) and
powered by the best advanced visualisation tools in the cloud
(thanks to our alliance with Vital by Canon Group).
Scaling revenue:
IMEXHS Partners Program
Our new distribution model is designed to help our partners
create a sustainable source of revenue, without having to
make heavy initial investments, by leveraging the potential
of our innovative platforms in the medical imaging field.
IMEXHS Partners
Program journey:
LITE
Basic
ULTIMATE
+ Lite & Pro features
PRO
+ Lite features
CUSTOM
Just for you
Benefits for patients and doctors:
Powered by Vitrea de Vital, an embedded tool that offers the
possibility of making more accurate and safe diagnoses, even
when it’s difficult to visualise using standard technology. It also
reduces waiting times for patients and facilitates clinical work,
thanks to its multiple connectivity options.
Starter
Intermediate
Advanced
Champion
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About IMEXHS®
Strategic global
business alliances
Among the objectives of IMEXHS® is growth in all areas. In order to
join forces and promote growth and competitiveness, we have
established alliances with different companies and entities.
AGMednet
We have expanded the clinical research collaboration
agreement and provided additional resources to develop
new features specifically related to clinical trials.
2020 Alliances:
IMEXHS signed a new global partnership agreement to license
Vitrea® software by Vital Images, Inc.
IMEXHS entered a partnership agreement with Entelai Pic, an
in medical artificial
Argentinian company specialising
Thanks to the IMEXHS-Vital Images collaboration, the Vitrea®
intelligence (AI). Entelai’s AI tools for neurology will be available
application suite will now be available in the cloud through an
through the AQUILA platform via an on-demand subscription
affordable subscription-on-demand model, allowing
IMEXHS
model. As a result of this new partnership, Entelai’s AI tools will
customers to access their data, performing advanced analysis and
be seamlessly embedded within AQUILA to perform an
visualisation processes, directly from our AQUILA platform.
automated MRI analysis of the brain using the convolutional
Vitrea® is an advanced 2D, 3D, and 4D visualisation system that
neural networks developed by Entelai for brain extraction,
allows users to analyse medical data from various modalities such
hyperintense lesions, tissues and other areas of the brain
as computed tomography, magnetic resonance spectroscopy,
(starting from a volumetric T1 and a volumetric FLAIR). The use
X-ray angiography, positron emission tomography, photon
of these technologies significantly enhances the screening
emission tomography, and ultrasound,
improving diagnosis
process across medical centres.
through its clinical tools.
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About IMEXHS®
What's to come in
Software Development
At IMEXHS, innovation is at the heart of our business as it allows us to
yield patient-centered medical imaging technology. In the months
to come, our highly specialised Development team will focus on
further developing
in Machine Learning and
Artificial Intelligence (AI) which will consolidate Stella AI, our AI
portfolio, as an intelligent decision support system (IDSS).
investigations
The development of Alula Market place, the world’s first dedicated
pathology marketplace workflow platform will also be carried out.
This unique platform will provide genetic diagnostics, logistics
management and second opinions, among many other services.
We are also excited about venturing into the veterinary imaging
field where we will develop a Veterinary Information Medical System
(VIMS).
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IMEXHS Limited
Directors' report
31 December 2020
The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as
the 'Group') consisting of IMEXHS Limited (referred to hereafter as the 'Company' or 'parent entity') and the entities it
controlled at the end of, or during, the year ended 31 December 2020.
Directors
The following persons were directors of IMEXHS Limited during the whole of the financial year and up to the date of this
report, unless otherwise stated:
Mr Douglas Flynn
Dr German Arango
Dr Douglas Lingard
Mr Carlos Palacio
Mr Damian Banks
Mr Howard Digby
Chairman (appointed 12 March 2020)
Chief Executive Officer
Non-Executive Director
Non-Executive Director
Non-Executive Director (appointed on 22 May 2020)
Non-Executive Director (resigned on 30 April 2020)
Principal activities
The Group remains focussed on the development and sale of its HIRUKO™ software platform. HIRUKO™ is a modular
imaging system that includes a Radiology Information System ('RIS'); a Cardiology Information System ('CIS'); an Anatomical
Pathology and Laboratory Information System ('APLIS'); and a Picture Archiving and Communications System ('PACS'). The
RIS, CIS and APLIS combine a workflow management system with a patient data and image distribution system, and the
PACS allows a healthcare organisation to capture, store, view and share radiology images.
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Review of operations
A review of operations of the Group for the financial year ended 31 December 2020 is contained in Chairman's and Chief
Executive Officer's Report. The Chairman's and Chief Executive Officer's Report precedes the Directors' Report.
Significant changes in the state of affairs
COVID-19
On 11 March 2020, the World Health Organisation recognised COVID-19 as a pandemic. IMEXHS has since adopted remote
working policies and procedures for its workforce to address the health and wellbeing of our employees.
IMEXHS has operated effectively during the year and has continued to meet its service level obligations to its customers.
Although there has been some delay in decision-making for some of the larger deals in the pipeline, they remain open
opportunities. As a result of the pandemic, there has also been increased interest in the teleradiology capabilities of
HIRUKO™ which is expected to lead to future sales opportunities.
There were no other significant changes in the state of affairs of the Group during the financial year.
Matters subsequent to the end of the financial year
On 2 March 2021, 301,680 share options were exercised and on 9 March 2021, 193,320 share options were exercised. The
share options were granted on 22 July 2017 and had an exercise price of $1.25 per share option.
On 4 March 2021, 140,000 share options were granted to Ms Reena Minhas, the Group's Chief Financial Officer and
Company Secretary. The share options have an exercise price of $nil and expire on the 1 March 2031.
ANNUAL REPORT 2020
22
IMEXHS Limited
Directors' report
31 December 2020
The consequences of the Coronavirus (COVID-19) pandemic are continuing to be felt around the world, and its impact on
the Group, if any, has been reflected in its published results to date. Whilst it would appear that control measures and related
government policies, including the roll out of the vaccine, have started to mitigate the risks caused by COVID-19, it is not
possible at this time to state that the pandemic will not subsequently impact the company's operations going forward. The
Group now has experience in the swift implementation of business continuation processes should future lockdowns of the
population occur, and these processes continue to evolve to minimise any operational disruption. Management continues to
monitor the situation both locally and internationally.
No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly
affect the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
Likely developments and expected results of operations
Other than as referred to in this report, further information as the likely developments in the operations of the Group and
likely results of those operations would, in the opinion of the Directors, be speculative.
Environmental regulation
The Group is not subject to any significant environmental regulation under Australian Commonwealth or State law.
Information on directors
Name:
Title:
Qualifications:
Experience and expertise:
Mr Douglas Flynn (appointed 12 March 2020)
Non-Executive Chairman
B.Eng., MBA
Mr Flynn is a businessman with extensive executive and non-executive leadership
experience in large and small listed companies in Australia, UK and Hong Kong. He
also has sound experience in early stage technology businesses.
NextDC Limited
Other current directorships:
Former directorships (last 3 years): Konekt Limited, APN Outdoor Group Limited, iSentia Group Limited
Special responsibilities:
Member of the Remuneration and Nomination Committee and Audit and Risk
Committee
591,649 ordinary shares
608,340 unlisted options over ordinary shares
Interests in shares:
Interests in options:
Experience and expertise:
Name:
Title:
Qualifications:
Dr German Arango
Chief Executive Officer
Medical Doctor and Surgery (El Bosque), Diagnostic Radiology (La Sabana),
Diagnostic Neuroradiology (McGill), Member of RSNA, Member of CAR, Member of
ACR, Member of ASNR
Dr Arango is the CEO and founder of Imaging Experts and Healthcare Services S.A.S.
and has over 15 years’ experience as a practising radiologist in Colombia.
None
Other current directorships:
Former directorships (last 3 years): None
None
Special responsibilities:
3,150,503 ordinary shares
Interests in shares:
917,235 options over ordinary shares
Interests in options:
ANNUAL REPORT 2020
23
IMEXHS Limited
Directors' report
31 December 2020
Name:
Title:
Qualifications:
Experience and expertise:
Dr Douglas Lingard
Non-Executive Director
MB.ChB. FRANZCR, MAICD
Dr Lingard is an experienced Radiologist and Nuclear Physician who has worked in
various leadership roles in Auckland, Washington DC and Sydney. He is a Senior
Associate of FINSIA and a member of the Australian Institute of Company Directors.
He is the founder and present Chairman of the Mito Foundation, the peak charity in
Australia for people with mitochondrial disease.
Other current directorships:
None
Former directorships (last 3 years): None
Special responsibilities:
Member of the Remuneration and Nomination Committee and Audit and Risk
Committee
515,825 ordinary shares
888,320 options over ordinary shares
Interests in shares:
Interests in options:
Name:
Title:
Qualifications:
Experience and expertise:
Mr Carlos Palacio
Non-Executive Director
B.Elec.Eng, MBA
Mr Palacio has over 27 years’ experience internationally in IT, telecommunications and
strategic management.
None
Other current directorships:
Former directorships (last 3 years): None
Special responsibilities:
Chairman of the Remuneration and Nomination Committee and member of the Audit
and Risk Committee
2,076,672 ordinary shares
604,599 options over ordinary shares
Mr Damian Banks (appointed on 22 May 2020)
Non-Executive Director
Bachelor of Economics
Mr Banks is a proven business leader with experience in the profitable development
and expansion of companies in health, employment, banking and private equity. Mr
Banks has a proven business insight that leads to sustained performance of successful
businesses. He also has global experience in achieving a culture with strong customer
focus through vision development and rigorous leadership implementation.
None
Chairman of the Audit and Risk Committee and member of the Remuneration and
Nomination Committee
361,660 ordinary shares
48,430 options over ordinary shares
Other current directorships:
Former directorships (last 3 years): Konekt Limited
Special responsibilities:
Interests in shares:
Interests in options:
Interests in shares:
Interests in options:
Name:
Title:
Qualifications:
Experience and expertise:
'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all
other types of entities, unless otherwise stated.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and excludes
directorships of all other types of entities, unless otherwise stated.
Company secretary
The Company’s Company Secretary is Ms Reena Minhas. Ms Minhas is also the Chief Financial Officer (appointed 1 October
2020).
Reena Minhas has extensive experience as a Chief Financial Officer and Company Secretary of ASX-listed businesses,
providing the financial leadership and strategic direction necessary to drive superior business performance. Ms Minhas was
previously the CFO and Company Secretary of ASX-listed Konekt Limited where she played a key role in the sale of that
business to Quadrant Private Equity’s APM. Prior to joining Konekt Limited, Ms Minhas was CFO and Company Secretary
of ILH Group Limited and Energy One Limited.
ANNUAL REPORT 2020
24
IMEXHS Limited
Directors' report
31 December 2020
Meetings of directors
The number of meetings of the Company's Board of Directors ('the Board') and Board Committees held during the year
ended 31 December 2020, and the number of meetings attended by each director were:
Full Board
Remuneration and
Nomination Committee
Audit and Risk Committee
Attended
Held
Attended
Held
Attended
Held
Douglas Flynn
German Arango
Howard Digby
Douglas Lingard
Carlos Palacio
Damian Banks
13
15
4
15
15
10
13
15
4
15
15
10
3
-
-
3
3
3
3
-
-
3
3
3
3
-
-
3
3
3
3
-
-
3
3
3
Held: represents the number of meetings held during the time the director held office.
ANNUAL REPORT 2020 25
IMEXHS Limited
Directors' report
31 December 2020
Remuneration report (audited)
Message from the Chair of Remuneration and Nomination Committee
This Remuneration Report details our relatively simple executive remuneration. Importantly in 2020 we have this year
established a formal Remuneration and Nominations Committee and had approved by shareholders a Long Term Incentive
Plan (LTIP) at an Extraordinary General Meeting held in October 2020.
Retention of talented key staff and alignment with shareholders interest are the objectives of this LTIP plan. The LTIP plan,
offered to key staff commencing from 1 January 2021, will be measured one third over two years and two thirds over three
years with the comparator measure being the ASX 300 accumulation index. Details of the plan will be appropriately reported
in the 2021 Annual Report . With the exception of sales staff no Short Term Incentive Plan currently exists.
As the Company grows and as it operates in more diverse economies and disparate salary norms, the challenge to manage
our cost base, motivate, reward and retain that talent will become somewhat more challenging.
This is a young company and a talented team with an ambitious agenda. The remuneration structure and guidance we
provide will be critical to our success.
The Board through the Remuneration and Nomination Committee has established a Board Skills Matrix and Board evaluation
process which is performed at least annually.
Yours sincerely
_______________________
Carlos Palacio
Chair Remuneration and Nomination Committee
The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance
with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel 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:
●
●
●
●
●
Principles used to determine the nature and amount of remuneration
Details of remuneration
Service agreements
Share-based compensation
Additional disclosures relating to key management personnel
Principles used to determine the nature and amount of remuneration
The objective of the Group's executive reward framework is to ensure reward for performance is competitive and appropriate
for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation
of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board
of Directors ('the Board') ensures that executive reward satisfies the following key criteria for good reward governance
practices:
●
●
●
●
competitiveness and reasonableness;
acceptability to shareholders;
performance linkage / alignment of executive compensation; and
transparency.
The Remuneration and Nomination Committee is responsible for determining and reviewing remuneration arrangements for
its directors and executives. The performance of the Group depends on the quality of its directors and executives. The
remuneration philosophy is to attract, motivate and retain high performance and high quality personnel.
The Remuneration and Nomination Committee has structured an executive remuneration framework that is market
competitive and complementary to the reward strategy of the Group.
ANNUAL REPORT 2020 26
IMEXHS Limited
Directors' report
31 December 2020
The reward framework is designed to align executive reward to shareholders' interests. The Remuneration and Nomination
Committee have considered that it should seek to enhance shareholders' interests by:
●
●
having economic profit as a core component of plan design;
focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price, and delivering
constant or increasing return on assets as well as focusing the executive on key non-financial drivers of value; and
attracting and retaining high calibre executives to run and manage the business.
●
Additionally, the reward framework should seek to enhance executives' interests by:
●
●
●
rewarding capability and experience;
reflecting competitive reward for contribution to growth in shareholder wealth; and
providing a clear structure for earning rewards.
In accordance with best practice corporate governance, the structure of non-executive director and executive director
remuneration is separate.
Non-Executive Directors' remuneration
Fees and payments to non-executive directors reflect the Group’s current stage of development, remaining cognisant of
market rates for comparable companies for time, commitment and responsibilities. Non-executive directors' fees and
payments are reviewed annually by the Remuneration and Nomination Committee. The Remuneration and Nomination
Committee may, from time to time, receive advice from independent remuneration consultants to ensure non-executive
directors' fees and payments are appropriate and in line with the market. The chairman's fees are determined independently
to the fees of other non-executive directors based on comparative roles in the external market. The chairman is not present
at any discussions relating to the determination of his own remuneration.
ASX listing rules require the aggregate non-executive directors' remuneration be determined periodically by a general
meeting. The most recent determination was at the Annual General Meeting held on 21 May 2020, where the shareholders
approved the maximum aggregate remuneration payable by the Company to all non-executive directors of the Company for
their services as directors including their services on a Board committee or sub-committee and including superannuation is
limited to $400,000 per annum.
The total remuneration packages exclusive of superannuation benefits for the Non-Executive Directors are as follows:
Board fees
Chairman
Non-Executive Directors
$ per annum
72,000
36,000
Executive remuneration
The Group aims to reward executives based on their position and responsibility, with a level and mix of remuneration which
has both fixed and variable components.
The executive remuneration and reward framework has the following components:
●
●
●
●
base pay and non-monetary benefits;
performance pay incentives;
share-based payments; and
other remuneration such as superannuation and long service leave.
The combination of these comprises the executive's total remuneration.
Fixed remuneration, consisting of base salary, superannuation and non-monetary benefits, are reviewed annually by the
Remuneration and Nomination Committee based on individual and business unit performance, the overall performance of
the Group and comparable market remunerations.
Executives may be offered specific performance pay incentives based on key performance areas affecting the Group’s
financial results where the Remuneration and Nomination Committee deems such incentives to be appropriate. No such
incentives were offered during the financial year ended 31 December 2020.
ANNUAL REPORT 2020 27
IMEXHS Limited
Directors' report
31 December 2020
The long-term incentives ('LTI') include long service leave and share-based payments. At the discretion of the Remuneration
and Nomination Committee, share options may be awarded to executives based on varied long-term incentive measures.
The Remuneration and Nomination Committee reviews the long-term equity-linked performance incentives specifically for
executives on an annual basis.
Consolidated entity performance and link to remuneration
Due to the change in the nature of operations of the business during the past two years there does not yet exist a clear link
between the gross revenue, profits and dividends for the last five years for the Group as well as the share price at the end
of the respective financial years. The normal operations of the Group during a full financial year for 2020 will help establish
these relationships.
Use of remuneration consultants
During the financial year ended 31 December 2020, the Group did not engage remuneration consultants to review its existing
remuneration policies.
Voting and comments made at the Company's 21 May 2020 Annual General Meeting ('AGM')
At the 2020 AGM, 95.74% of the votes received supported the adoption of the remuneration report for the year ended 31
December 2019. The Company did not receive any specific feedback at the AGM regarding its remuneration practices.
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the Group are set out in the following tables.
The key management personnel of the Group consisted of the following directors of IMEXHS Limited:
●
●
●
●
●
●
Mr Douglas Flynn - Chairman (appointed 12 March 2020)
Dr German Arango - Chief Executive Officer
Dr Douglas Lingard - Non-Executive Director
Mr Carlos Palacio - Non-Executive Director
Mr Damian Banks - Non-Executive Director (appointed on 22 May 2020)
Mr Howard Digby - Non-Executive Director (resigned on 30 April 2020)
And the following persons:
●
●
Ms Reena Minhas - Chief Financial Officer and Company Secretary (appointed on 1 October 2020)
Mr Tony Thomas - Chief Financial Officer (ceased as Chief Financial Officer on 1 October 2020 and resigned on 12
December 2020)
ANNUAL REPORT 2020 28
IMEXHS Limited
Directors' report
31 December 2020
2020
Non-Executive Directors:
Mr Douglas Flynn*/**
Mr Howard Digby*
Dr Douglas Lingard
Mr Carlos Palacio
Mr Damian Banks*
Executive Directors:
Dr German Arango
Other Key Management
Personnel:
Ms Reena Minhas*
Mr Tony Thomas*
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
Cash salary
and fees
$
Cash
bonus
$
Non-
Super-
monetary annuation
$
$
Long
service
leave
$
Equity-
settled
$
Total
$
57,871
12,000
36,000
43,065
21,968
-
-
-
-
-
-
-
-
-
-
5,498
-
3,420
4,091
2,087
-
-
-
-
-
555,273
-
9,750
-
-
618,642
12,000
49,170
47,156
24,055
314,586
-
12,109
14,177
27,103
-
367,975
62,557
231,600
779,647
-
-
-
4,533
-
16,642
5,943
-
35,216
-
-
27,103
-
-
73,033
231,600
565,023 1,423,631
*
**
Represents remuneration from the date of appointment and/or to the date of resignation
Share based payment relates to the issue of 28,000,000 options (560,000 options post share consolidation) granted in
accordance with Mr Flynn's appointment.
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
Cash salary
and fees
$
Cash
bonus
$
Non-
Super-
monetary annuation
$
$
Long
service
leave
$
Equity-
settled
$
Total
$
36,000
36,000
39,000
66,000
-
-
-
-
-
-
-
-
-
3,420
3,705
6,270
-
-
-
-
-
9,750
-
55,962
36,000
49,170
42,705
128,232
313,589
-
12,068
17,336
27,011
-
370,004
189,824
205,650
139,713
1,025,776
-
-
-
-
-
-
-
12,068
-
-
-
30,731
-
-
-
27,011
-
-
-
189,824
205,650
139,713
65,712 1,161,298
2019
Non-Executive Directors:
Mr Howard Digby
Dr Douglas Lingard
Mr Carlos Palacio
Mr Tom Pascarella*
Executive Directors:
Dr German Arango**
Other Key Management
Personnel:
Dr Jorge Marin
Mr Tony Thomas
Mr Andres Vanegas
*
**
represents remuneration from the date of appointment and/or up to the date of resignation
2019 comparative information has been updated to reflect all statutory payments made in the period.
ANNUAL REPORT 2020 29
IMEXHS Limited
Directors' report
31 December 2020
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Name
Non-Executive Directors:
Mr Douglas Flynn
Mr Howard Digby
Dr Douglas Lingard
Mr Carlos Palacio
Mr Damian Banks
Mr Tom Pascarella
Executive Directors:
Dr German Arango
Other Key Management
Personnel:
Ms Reena Minhas
Dr Jorge Marin
Mr Tony Thomas
Mr Andres Vanegas
Fixed remuneration
2019
2020
At risk - STI
At risk - LTI
2020
2019
2020
2019
10%
100%
80%
100%
100%
-
-
100%
80%
100%
-
56%
100%
100%
100%
-
100%
-
-
100%
100%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
90%
-
20%
-
-
-
-
-
-
-
-
-
-
20%
-
-
44%
-
-
-
-
-
Service agreements
Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details
of these agreements are as follows:
Name:
Title:
Agreement commencement:
Term of agreement:
Remuneration package:
Termination by Executive:
Dr German Arango
Chief Executive Officer
2 July 2018
No fixed term
Remuneration comprises a base salary of $290,000 per annum plus statutory
superannuation.
6 months' written notice; or immediately by giving notice, if the Company is in breach
of a material term of its agreement with him; or with 6 months’ written notice if Dr
Arango’s role becomes redundant.
Termination by Company for cause: 1 month’s notice, or immediately with payment in lieu of notice if Dr Arango is unable
to perform his duties under the agreement for three consecutive months or a period
aggregating to three months in a 12 month period; or 6 months' written notice if Dr
Arango's role becomes redundant. If the Company terminates the employment of Dr
Arango within 6 months of a Change of Control it will be deemed to be a termination
by reason of redundancy. If the Company terminates for reason of redundancy it shall
be obliged to pay Dr Arango for any notice period worked. In addition, it will be
required to pay any redundancy amount payable under applicable laws, an amount
equal to 6 months' base salary (less tax) and any accumulated entitlements; or at any
time with written notice and without payment (other than entitlements accrued to the
date of termination) as a result of any occurrence which gives the Company a right of
summary dismissal at common law.
Immediately with 6 months' payment in lieu of notice.
The service agreement otherwise contains industry
executive of a public listed company.
standard provisions for a senior
(cid:486)
Termination by Company:
Other provisions:
ANNUAL REPORT 2020 30
IMEXHS Limited
Directors' report
31 December 2020
Name:
Title:
Agreement commencement:
Term of agreement:
Remuneration package:
Ms Reena Minhas
Chief Financial Officer and Company Secretary
1 October 2020
No fixed term
Remuneration comprises a base salary of $274,000 per annum including statutory
superannuation. Ms Minhas will be granted 140,000 performance rights on joining the
Company which will vest into ordinary shares provided she remains as an officer or
employee for three years.
6 months' written notice.
Termination by Executive:
Termination by Company for cause: At any time with written notice and without payment (other than entitlements accrued
to the date of termination) as a result of any occurrence which gives the Company a
right of summary dismissal at common law.
Immediately with 6 months' payment in lieu of notice.
The service agreement otherwise contains industry
executive of a public listed company.
Termination by Company:
Other provisions:
standard provisions for a senior
(cid:486)
Key management personnel have no entitlement to termination payments in the event of removal for misconduct.
Share-based compensation
Issue of shares
There were no shares issued to directors and other key management personnel as part of compensation during the year
ended 31 December 2020.
Options
The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and other key
management personnel in this financial year or future reporting years are as follows:
Name
Grant date
Vesting and
exercisable
date
Expiry date
Number of
options
granted
Fair value
per
Exercise option at
grant date
price
Vested
%
Mr Douglas Flynn(a)
26/05/2020
Mr Douglas Flynn(a)
26/05/2020
Mr Douglas Flynn(a)
26/05/2020
Dr Douglas Lingard(b) 10/12/2018
Dr Douglas Lingard(b) 10/12/2018
26/05/2020
26/05/2020
31/12/2021
10/12/2020
10/12/2021
12/03/2027
12/03/2027
12/03/2027
09/12/2023
09/12/2023
160,000
160,000
240,000
10,000
30,000
$2.75
$3.50
$1.50
$2.65
$2.65
$1.30
$1.25
$1.35
$0.66
$0.66
100%
100%
-
100%
-
(a) On 26 May 2020, 560,000 share options (28,000,000 share options prior to the share consolidation) were granted to Mr
Douglas Flynn as part of his appointment as Non-Executive Chairman. The grant consists of 3 tranches, tranche 1 and
2 each comprise of 160,000 options and tranche 3 comprises of 240,000 options. Tranche 1 and 2 vest on 26 May 2020
and tranche 3 vests when the Company's share price reaches or exceeds a 30 day VWAP of $6.00 (12 cents prior to
the share consolidation). For the purposes of calculating the fair value of tranche 3, 31 December 2021 has been used
as the estimated vesting date. Tranche 1, 2 and 3 have an exercise price of $2.75, $3.50 and $1.50 respectively ($0.055,
$0.070 and $0.030 respectively prior to the share consolidation). All tranches expire on 12 March 2027.
(b) On 10 December 2018, 40,000 share options (2,000,000 shares options prior to the share consolidation) were issued
as remuneration to Non-Executive Director, Dr Douglas Lingard subject to vesting conditions. 10,000 options vested on
10 December 2020 and the remaining 30,000 options vest on 10 December 2021, have an exercise price of $2.65
($0.053 prior to the share consolidation) and expire on 9 December 2023.
Options granted carry no dividend or voting rights.
ANNUAL REPORT 2020 31
IMEXHS Limited
Directors' report
31 December 2020
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the Company held during the financial year by each director and other members of key management
personnel of the Group, including their personally related parties, is set out below:
Balance at Received
as part of
the start of
the year
remuneration Purchases consolidation*
other**
Share
Disposals/
Balance at
the end of
the year
Ordinary shares
Mr Douglas Flynn
Dr German Arango
Mr Howard Digby
Dr Douglas Lingard
Mr Carlos Palacio
Mr Damian Banks
Mr Tony Thomas
Mr Andres Vanegas
-
157,525,160
8,850,000
2,685,758
103,833,600
-
2,507,745
102,437,920
- 26,642,467
-
-
689,655
- 22,983,401
-
- 16,123,000
-
325,605
-
(26,050,818)
- (154,374,657)
(9,348,862)
(25,153,334)
- (101,756,928)
(15,761,340)
(2,776,683)
- (100,389,162)
-
-
(190,793)
-
-
-
(56,667)
(2,048,758)
591,649
3,150,503
-
515,825
2,076,672
361,660
-
-
377,840,183
- 66,764,128 (435,611,784)
(2,296,218)
6,696,309
*
**
1:50 Share Consolidation approved at Annual General Meeting on 30 October 2020.
Disposals/other represents no longer being designated as key management personnel, not necessarily a disposal of
holding.
Option holding
The number of options over ordinary shares in the Company held during the financial year by each director and other
members of key management personnel of the Group, including their personally related parties, is set out below:
Balance at
the start of
the year
Granted
Purchased consolidation*
Share
Expired/
forfeited/
other
Balance at
the end of
the year
Mr Douglas Flynn(a)
Dr German Arango
Mr Howard Digby(b)
Dr Douglas Lingard
Mr Carlos Palacio
Mr Damian Banks
45,861,762
1,500,000
42,000,000
30,230,040
-
- 28,000,000
-
-
-
-
-
2,417,000
-
-
2,416,000
-
2,417,000
(29,808,660)
(44,944,527)
-
(43,527,680)
(29,625,441)
(2,368,660)
-
-
(1,500,000)
-
-
-
608,340
917,235
-
888,320
604,599
48,340
119,591,802 28,000,000
7,250,000 (150,274,968)
(1,500,000)
3,066,834
*
1:50 Share Consolidation approved at Annual General Meeting on 30 October 2020
(a) Appointed 12 March 2020. Share based payment relates to the issue of 28,000,000 Options in accordance with D Flynn
appointment.
(b) Resigned on 30 April 2020 and ceased to be key management personnel from that date.
ANNUAL REPORT 2020 32
IMEXHS Limited
Directors' report
31 December 2020
The number of options over ordinary shares vested by directors and other key management personnel are set out below:
Options over ordinary shares
Mr Douglas Flynn
Dr German Arango
Dr Doug Lingard
Mr Carlos Palacio
Mr Damian Banks
Vested and Unvested and
exercisable unexercisable
Balance at
the end of
the year
368,340
917,235
858,320
604,599
48,340
2,796,834
240,000
-
30,000
-
-
270,000
608,340
917,235
888,320
604,599
48,340
3,066,834
Other transactions with key management personnel and their related parties
The Group sold goods and services from entities that are controlled by members of the Group’s key management personnel
('KMP'):
KMP and related entity
Nature of Transactions
G Arango - RIMAB SAS(a)
C Palacio - CrossPoint
Telecommunications Pty Ltd
Sales revenue
A Vanegas - Datamedic SAS(d) Sales revenue
Sales revenue
Income amounts
2020
2019
$
Balance outstanding
2019
2020
$
$
4,424,734
3,352,350
738,602
1,681,000
8,083
-
-
30,548
859
-
-
256,169
4,432,817
3,382,898
739,461
1,937,169
The Group acquired services from entities that are controlled by members of the Group’s KMP:
KMP and related entity
Nature of transaction
Interpretation services
Supplies and license
G Arango - RIMAB SAS(a)
G Arango - RIMAB SAS(a)
G Arango - German Arango(b) PaaS Equipment Financing
C Palacio - CrossPoint
Telecommunications Pty Ltd(c)
J Marin - Jorge Marin(d)
A Vanegas - Datamedic SAS(d) Fixed Asset Purchases
A Vanegas - Datamedic SAS(d) Technical services
Office space and IT Services
PaaS Equipment Financing
Expense amounts
2019
$
2020
$
Balance outstanding
2019
2020
$
$
1,169,703
1,985
87,198
1,684,919
-
100,264
14,831
-
-
-
14,925
172,224
348,067
76,123
-
-
7,115
1,628
-
-
-
263,046
-
75,705
1,211
344,694
-
-
1,273,717
2,396,522
8,743
684,656
(a) The Company has an agreement with RIMAB S.A.S., an entity owned 65% by Dr Arango.
(b) Chief Executive Director, Dr German Arango has provided equipment to Imaging Experts and Healthcare Services
S.A.S. in return for payments from a contract providing PaaS services. The equipment is repaid at a 200% rate of
return on their loan which is paid in monthly instalments over the initial term of the PaaS contract.
(c) CrossPoint Telecommunications is an associated entity of Carlos Palacio, providing various services to IMEXHS and
also a non-exclusive distributor in Australia of IMEXHS’s HIRUKO™ product.
(d) No longer designated a KMP for the financial year ended 31 December 2020.
During 2019, the company entered into a loan with Domatorisaro Pty Ltd, a related party of Dr Douglas Lingard. This loan
included the granting of 40,000,000 options (800,000 options post share consolidation) (note 33). These options have been
included as a cost of borrowing (note 19) which is being amortised over the life of the loan.
ANNUAL REPORT 2020 33
IMEXHS Limited
Directors' report
31 December 2020
At 31 December 2019, the Group had loans from Dr Doug Lingard of $1,000,000, of which the interest paid and payable
amounted to $95,591. During the year ended 30 December 2020, the loan and all outstanding interest was repaid in full.
All transactions were made on normal commercial terms and conditions and at market rates.
This concludes the remuneration report, which has been audited.
Shares under option
Unissued ordinary shares of IMEXHS Limited under option at the date of this report are as follows:
Grant date
22 July 2017
28 August 2018
28 August 2018
28 August 2018
28 August 2018
28 August 2018
25 October 2018
10 December 2018
7 October 2019
31 October 2019
1 April 2020
1 April 2020
26 May 2020
26 May 2020
26 May 2020
4 March 2021
Expiry date
31 March 2021
30 June 2021
28 August 2023
28 August 2023
30 June 2021
30 June 2021
25 October 2023
9 December 2023
31 March 2022
30 September 2022
1 April 2022
1 April 2023
12 March 2027
12 March 2027
12 March 2027
1 March 2031
Exercise
price
Number
under option
$1.250
$2.500
$1.875
$1.875
$1.875
$2.500
$3.500
$2.650
$2.700
$2.700
$3.250
$5.000
$2.750
$3.500
$1.500
$0.000
205,000
1,000,001
1,000,001
1,000,001
250,000
600,000
80,000
40,000
800,000
100,000
30,000
30,000
160,000
160,000
240,000
140,000
5,835,003
No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of the
Company or of any other body corporate.
Shares issued on the exercise of options
The following ordinary shares of IMEXHS Limited were issued during the year ended 31 December 2020 and up to the date
of this report on the exercise of options granted:
Date options granted
22 July 2017
Exercise
price
Number of
shares issued
$1.250
495,000
Indemnity and insurance of officers
The Company has indemnified the directors and executives of the Company 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 Company 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.
Indemnity and insurance of auditor
The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the
Company or any related entity against a liability incurred by the auditor.
ANNUAL REPORT 2020 34
IMEXHS Limited
Directors' report
31 December 2020
During the financial year, the Company has not paid a premium in respect of a contract to insure the auditor of the Company
or any related entity.
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
There were no non-audit services provided during the financial year by the auditor.
Officers of the Company who are former partners of Nexia Sydney Audit Pty Ltd
There are no officers of the Company who are former partners of Nexia Sydney Audit Pty Ltd.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this directors' report.
Auditor
Nexia Sydney Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001.
On behalf of the directors
___________________________
Douglas Flynn
Chairman
29 March 2021
ANNUAL REPORT 2020
35
To the Board of Directors of IMEXHS Limited
Auditor’s Independence Declaration under section 307C of the Corporations Act 2001
As lead audit partner for the audit of the financial statements of IMEXHS Limited for the financial year ended
31 December 2020, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
(a)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(b)
any applicable code of professional conduct in relation to the audit.
Yours sincerely
Nexia Sydney Audit Pty Ltd
Andrew Hoffmann
Director
Date: 29 March 2021
36
IMEXHS Limited
Statement of profit or loss and other comprehensive income
For the year ended 31 December 2020
Revenue
Other income
Interest revenue calculated using the effective interest method
Expenses
Hardware and licence expenses
Research and development and support expenses
Platform as a service expense
Clinical services expenses
Administration and sales expenses
Share-based payments expenses
Depreciation and amortisation expense
Reversal of impairment/(impairment) of inventories
Expected credit losses
Net foreign exchange losses
Other expenses
Finance costs
Loss before income tax (expense)/benefit
Income tax (expense)/benefit
Consolidated
Note
2020
$
2019
$
5
10,913,968
7,727,260
67,674
20,068
9,027
2,774
(1,433,397)
(646,665)
(572,396)
(4,536,638)
(4,441,049)
(598,457)
(1,024,386)
86,617
(54,386)
(31,315)
(72,990)
(1,204,736)
(1,090,415)
(2,121,479)
(760,571)
(3,120,907)
(4,294,600)
(65,712)
(825,929)
(63,784)
(669,527)
(60,946)
(112,310)
(595,512)
(3,528,088)
(6,042,631)
(87,889)
40,343
6
6
7
Loss after income tax (expense)/benefit for the year attributable to the owners
of IMEXHS Limited
(3,615,977)
(6,002,288)
Other comprehensive loss
Items that may be reclassified subsequently to profit or loss
Foreign currency translation
Other comprehensive loss for the year, net of tax
(498,095)
(5,840)
(498,095)
(5,840)
Total comprehensive loss for the year attributable to the owners of IMEXHS
Limited
(4,114,072)
(6,008,128)
Basic earnings per share
Diluted earnings per share
Cents
Cents
32
32
(14.62)
(14.62)
(30.85)
(30.85)
The above statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
ANNUAL REPORT 2020
37
IMEXHS Limited
Statement of financial position
As at 31 December 2020
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other
Total current assets
Non-current assets
Trade receivables
Property, plant and equipment
Right-of-use assets
Intangibles
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Contract liabilities
Borrowings
Lease liabilities
Income tax
Employee benefits
Total current liabilities
Non-current liabilities
Borrowings
Deferred tax
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Consolidated
Note
2020
$
2019
$
8
9
10
11
12
13
14
15
16
17
18
19
7
10,796,484
3,756,525
389,668
302,187
15,244,864
7,149,683
3,403,028
107,354
250,619
10,910,684
997,688
3,346,293
102,046
1,113,256
5,559,283
-
3,376,006
40,805
469,887
3,886,698
20,804,147
14,797,382
2,382,531
53,548
868,777
101,469
6,611
1,045,997
4,458,933
1,425,203
63,936
1,232,589
40,574
41,469
850,081
3,653,852
727,951
81,277
809,228
826,894
-
826,894
5,268,161
4,480,746
15,535,986
10,316,636
20
21
28,461,991
2,588,050
(15,514,055)
19,757,466
2,457,248
(11,898,078)
15,535,986
10,316,636
The above statement of financial position should be read in conjunction with the accompanying notes
ANNUAL REPORT 2020
38
IMEXHS Limited
Statement of changes in equity
For the year ended 31 December 2020
Consolidated
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
Balance at 1 January 2019
10,553,259
1,193,326
(5,895,790)
5,850,795
Loss after income tax benefit for the year
Other comprehensive loss for the year, net of tax
Total comprehensive loss for the year
-
-
-
-
(5,840)
(6,002,288)
-
(6,002,288)
(5,840)
(5,840)
(6,002,288)
(6,008,128)
Transactions with owners in their capacity as owners:
Contributions of equity, net of transaction costs (note 20)
Share-based payments (note 33)
9,204,207
-
-
1,269,762
-
-
9,204,207
1,269,762
Balance at 31 December 2019
19,757,466
2,457,248
(11,898,078) 10,316,636
Consolidated
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
Balance at 1 January 2020
19,757,466
2,457,248
(11,898,078) 10,316,636
Loss after income tax expense for the year
Other comprehensive loss for the year, net of tax
Total comprehensive loss for the year
-
-
-
-
(498,095)
(3,615,977)
-
(3,615,977)
(498,095)
(498,095)
(3,615,977)
(4,114,072)
Transactions with owners in their capacity as owners:
Contributions of equity, net of transaction costs (note 20)
Share-based payments (note 33)
Share options issued
8,704,525
-
-
-
598,457
30,440
-
-
-
8,704,525
598,457
30,440
Balance at 31 December 2020
28,461,991
2,588,050
(15,514,055) 15,535,986
The above statement of changes in equity should be read in conjunction with the accompanying notes
ANNUAL REPORT 2020
39
IMEXHS Limited
Statement of cash flows
For the year ended 31 December 2020
Cash flows from operating activities
Loss before income tax (expense)/benefit for the year
Adjustments for:
Depreciation and amortisation
Share-based payments
Foreign exchange differences
Expected credit losses
(Reversal of impairment)/impairment in inventories
Interest received
Interest and other finance costs
Change in operating assets and liabilities:
Increase in trade and other receivables
Decrease/(increase) in inventories
Increase/(decrease) in trade and other payables
Decrease in contract liabilities
Increase in employee benefits
Increase in other operating liabilities
Interest received
Interest paid
Income taxes paid
Net cash used in operating activities
Cash flows from investing activities
Payments for property, plant and equipment
Payments for intangibles
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Proceeds from issue of options
Proceeds from borrowings
Repayment of borrowings
Share issue transaction costs
Repayment of lease liabilities
Net cash from financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effects of exchange rate changes on cash and cash equivalents
Consolidated
Note
2020
$
2019
$
(3,528,088)
(6,042,631)
1,024,386
598,457
65,635
54,386
(86,617)
(20,068)
1,204,736
825,929
65,712
-
669,527
63,784
(2,774)
491,419
(687,173)
(3,929,034)
(1,272,319)
(195,697)
952,246
(10,388)
195,916
-
(442,411)
640,172
(1,027,322)
(27,545)
430,929
387,358
(1,017,415)
20,068
(428,225)
(41,470)
(3,967,853)
2,774
(82,848)
(41,880)
(1,467,042)
(4,089,807)
13
15
(1,264,915)
(921,435)
(2,303,069)
(157,420)
(2,186,350)
(2,460,489)
20
9,280,000
30,440
939,825
(2,174,009)
(575,475)
(96,021)
10,000,000
4,050
2,383,134
(338,670)
(675,794)
(93,085)
7,404,760
11,279,635
3,751,368
7,149,683
(104,567)
4,729,339
2,445,329
(24,985)
Cash and cash equivalents at the end of the financial year
8
10,796,484
7,149,683
The above statement of cash flows should be read in conjunction with the accompanying notes
ANNUAL REPORT 2020
40
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 1. General information
The financial statements cover IMEXHS Limited as a Group consisting of IMEXHS Limited and the entities it controlled at
the end of, or during, the year. The financial statements are presented in Australian dollars, which is IMEXHS Limited's
functional and presentation currency.
IMEXHS Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office
and principal place of business is:
122 O’Riordan Street
Mascot NSW 2020
A description of the nature of the Group's operations and its principal activities are included in the directors' report, which is
not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of directors, on 29 March 2021. The
directors have the power to amend and reissue the financial statements.
Note 2. Significant accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
New or amended Accounting Standards and Interpretations adopted
The Group 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. The adoption of these Accounting
Standards and Interpretations did not have any significant impact on the financial performance or position of the Group.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
Going concern
The Group has prepared the financial statements for the year ended 31 December 2020 on the going concern basis, which
assumes continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary
course of business.
For the year ended 31 December 2020, the Group generated a consolidated loss of $3,615,977 (2019: loss of $6,002,288)
and incurred operating cash outflows of $1,467,042 (2019: outflows of 4,089,807). As at 31 December 2020, the Group had
cash and cash equivalents of $10,796,484 (2019: $7,149,683), a surplus of net current assets of $10,785,931 (2019:
$7,256,832) and surplus of net assets of $15,535,986 (2019: $10,316,636).
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate
for for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as
issued by the International Accounting Standards Board ('IASB').
Historical cost convention
The financial statements have been prepared under the historical cost convention.
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 Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial
statements, are disclosed in note 3.
Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the Group only.
Supplementary information about the parent entity is disclosed in note 28.
ANNUAL REPORT 2020
41
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 2. Significant accounting policies (continued)
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of IMEXHS Limited ('Company'
or 'parent entity') as at 31 December 2020 and the results of all subsidiaries for the year then ended. IMEXHS Limited and
its subsidiaries together are referred to in these financial statements as the 'Group'.
Subsidiaries are all those entities over which the Group has control. The Group controls an entity when the Group 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 Group. They are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the Group 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 Group.
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.
Where the Group loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-controlling
interest in the subsidiary together with any cumulative translation differences recognised in equity. The Group recognises
the fair value of the consideration received and the fair value of any investment retained together with any gain or loss in
profit or loss.
Foreign currency translation
The financial statements are presented in Australian dollars, which is IMEXHS Limited's functional and presentation currency.
Foreign currency transactions
Foreign currency transactions are translated into the Company's 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 financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in profit or loss.
Foreign operations
The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the reporting
date. The revenues and expenses of foreign operations are translated into Australian dollars using the average exchange
rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange differences
are recognised in other comprehensive income through the foreign currency reserve in equity.
The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of.
Revenue recognition
The Group recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised from Software as a Service (SaaS) and Platform as a Service (Paas) contracts. Revenue is
recognised at an amount that reflects the consideration to which the Group is expected to be entitled in exchange for
transferring goods or services to a customer. For each contract with a customer, the Group: 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.
ANNUAL REPORT 2020
42
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 2. Significant accounting policies (continued)
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 recognised as a refund liability.
Sales revenue comprises revenue earned (net of returns, discounts and allowances) from the sale of goods or provision of
services to entities outside the Group. The Group recognises revenue from contracts with customers in accordance with the
recognition of the completion of performance obligations under the contract. Where a contract includes an element of a
warranty obligation, the revenue attributable to this warranty obligation is recognised evenly over the period for which the
obligation exists.
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate,
which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the
net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
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.
An income tax benefit will arise for the financial year where an income tax loss is incurred and, where the permitted to do so,
is carried-back against a qualifying prior period’s tax payable to generate a refundable tax offset.
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.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
ANNUAL REPORT 2020
43
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 2. Significant accounting policies (continued)
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Group'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 Group'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.
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value.
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 Group 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.
Inventories
Stock on hand is stated at the lower of cost and net realisable value. Cost comprises of purchase and delivery costs, net of
rebates and discounts received or receivable.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion
and the estimated costs necessary to make the sale.
Joint operations
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the
assets, and obligations for the liabilities, relating to the arrangement. The Group has recognised its share of jointly held
assets, liabilities, revenues and expenses of joint operations. These have been incorporated in the financial statements under
the appropriate classifications.
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
Group 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 amortised cost
A financial asset is measured at amortised cost only if both of the following conditions are met: (i) it is held within a business
model whose objective is to hold assets in order to collect contractual cash flows; and (ii) the contractual terms of the financial
asset represent contractual cash flows that are solely payments of principal and interest.
ANNUAL REPORT 2020
44
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 2. Significant accounting policies (continued)
Impairment of financial assets
The Group 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 Group'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.
Property, plant and equipment
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.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment
(excluding land) over their expected useful lives as follows:
Leasehold improvements
Furniture and fittings
Computer equipment
Medical equipment
1-5 years
5-10 years
3-5 years
5-10 years
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.
Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the assets,
whichever is shorter.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the
Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which
comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the
commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the
cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and
restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful
life of the asset, whichever is the shorter. Where the Group expects to obtain ownership of the leased asset at the end of the
lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for
any remeasurement of lease liabilities.
The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms
of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as
incurred.
ANNUAL REPORT 2020
45
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 2. Significant accounting policies (continued)
Intangible assets
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.
Internally developed software
Research costs associated with internally developed software are expensed in the period in which they are incurred.
Development costs associated with internally developed software are capitalised when it is probable that the project will be
a success considering its commercial and technical feasibility; the Group is able to use or sell the asset; the Group has
sufficient resources and intent to complete the development; and its costs can be measured reliably. Capitalised development
costs are amortised on a straight-line basis over the period of their expected benefit, being their finite life of 10 years.
Copyright
Significant costs associated with copyright are deferred and amortised on a straight-line basis over the period of their
expected benefit, being their finite life of 5-10 years.
Licences
The acquisition of licences are capitalised as an asset and amortised on a straight-line basis over the period of their expected
benefit, being their finite life of 5-10 years.
Impairment of non-financial assets
Non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount
exceeds its recoverable amount.
Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the
present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or
cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to
form a cash-generating unit.
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and
which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The amounts
are unsecured and are usually paid within 30 days of recognition.
Contract liabilities
Contract liabilities represent the Group's obligation to transfer goods or services to a customer and are recognised when a
customer pays consideration, or when the Group recognises a receivable to reflect its unconditional right to consideration
(whichever is earlier) before the Group has transferred the goods or services to the customer.
Borrowings
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.
Lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present
value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or,
if that rate cannot be readily determined, the Group's incremental borrowing rate. Lease payments comprise of fixed
payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected
to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably
certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or
a rate are expensed in the period in which they are incurred.
ANNUAL REPORT 2020
46
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 2. Significant accounting policies (continued)
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured
if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual
guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an
adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset
is fully written down.
Finance costs
Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in
the period in which they are incurred.
Employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be
settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities
are settled.
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are
measured at the present value of expected future payments to be made in respect of services provided by employees up to
the reporting date. 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 high quality
corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
Share-based payments
Equity-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.
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 Group 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.
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 Group or employee, the failure to satisfy the condition is treated as a
cancellation. If the condition is not within the control of the Group 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.
Issued capital
Ordinary shares are classified as equity.
ANNUAL REPORT 2020
47
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 2. Significant accounting policies (continued)
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.
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of IMEXHS 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.
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.
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 Group for the annual reporting period ended 31 December 2020. The Group has not yet
assessed the impact of these new or amended Accounting Standards and Interpretations.
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in
relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and
assumptions on historical experience and on other various factors, including expectations of future events, management
believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal
the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are
discussed below.
Coronavirus (COVID-19) pandemic
Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19) pandemic has had, or may have,
on the Group based on known information. This consideration extends to the nature of the products and services offered,
customers, supply chain, staffing and geographic regions in which the Group operates. Other than as addressed in specific
notes, there does not currently appear to be either any significant impact upon the financial statements or any significant
uncertainties with respect to events or conditions which may impact the Group unfavourably as at the reporting date or
subsequently as a result of the Coronavirus (COVID-19) pandemic.
ANNUAL REPORT 2020
48
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 3. Critical accounting judgements, estimates and assumptions (continued)
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a degree of estimation and judgement. It is based on the
lifetime expected credit loss, grouped based on days overdue, and makes assumptions to allocate an overall expected credit
loss rate for each group. These assumptions include recent sales experience, historical collection rates, the impact of the
Coronavirus (COVID-19) pandemic and forward-looking information that is available. The allowance for credit losses, as
disclosed in note 9, is calculated based on the information available at the time of preparation. The actual credit losses in
future years may be higher or lower.
Issued Capital
No value has been allocated to the Class A Performance Shares due to the uncertainty of meeting the performance
milestone.
Issued Options
No value has been allocated to the Class B or Class C options due to the uncertainty of meeting the performance milestone.
Share Based Payments
Share based payments are measured at the fair value of goods or services received or the fair value of the equity instrument
issued (if the fair value of goods or services cannot be reliably determined) and are recorded at the date the goods or services
are received. The fair value of options is determined using the Black-Scholes option pricing model. The number of share and
options expected to vest is reviewed and adjusted at the end of each reporting period such that the amount recognised for
services received as consideration for the equity instruments granted is based on the number of equity instruments that
eventually vest.
Note 4. Operating segments
The Group is organised into one main operating segment. All of the Group’s activities are interrelated and discrete financial
information is reported to the Board (Chief Operating Decision Maker) as a single segment. Accordingly, all significant
operating decisions are based upon analysis of the Group as one segment. The financial results from this segment are
equivalent to the financial statements of the Group as a whole.
Note 5. Revenue
Medical equipment and licences
Leasing equipment and software and services
Sale of inputs
Service and maintenance of equipment and software
Returns and discounts given
Revenue
Consolidated
2020
$
2019
$
2,078,376
8,414,224
228,709
192,659
-
862,009
6,670,570
305,960
210,863
(322,142)
10,913,968
7,727,260
ANNUAL REPORT 2020
49
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 5. Revenue (continued)
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
The majority of the Group's revenue is derived from one geographic region, Latin America.
Note 6. Expenses
Loss before income tax includes the following specific expenses:
Finance costs
Interest and finance charges paid/payable on borrowings
Interest and finance charges paid/payable on lease liabilities
Administration expenses
Employee and Director benefits expense
Professional and consultancy fees
Taxes
Office expenses
Insurance
Advertising and marketing
Corporate expenses
Maintenance
Travel expenses
Other
Leases
Short-term lease payments
Consolidated
2020
$
2019
$
2,037,930
8,876,038
1,021,204
6,706,056
10,913,968
7,727,260
Consolidated
2020
$
2019
$
1,199,655
5,081
586,377
9,135
1,204,736
595,512
2,290,579
545,853
200,465
262,382
103,031
74,962
734,949
719
31,944
196,165
1,726,610
403,467
179,173
283,645
96,560
180,220
606,901
4,090
223,940
589,994
4,441,049
4,294,600
26,734
19,380
ANNUAL REPORT 2020
50
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 6. Expenses (continued)
Employee and Director benefits expense
Included in administration expenses:
Employee benefits expense excluding superannuation and share-based payments
Defined contribution superannuation expense
Included in research and development and support expenses and clinical services
expenses:
Employee benefits expense excluding superannuation and share-based payments
Defined contribution superannuation expense
Share-based payments expense
Note 7. Income tax
Income tax expense/(benefit)
Current tax
Deferred tax - origination and reversal of temporary differences
Aggregate income tax expense/(benefit)
Deferred tax included in income tax expense/(benefit) comprises:
Increase/(decrease) in deferred tax liabilities
Numerical reconciliation of income tax expense/(benefit) and tax at the statutory rate
Loss before income tax (expense)/benefit
Tax at the statutory tax rate of 27.5% (2019: 28.5%)
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Expected credit losses
Provision for inventories
Non-deductible taxes
Non-deductible employee contributions
Non-deductible interest, fines and levies
Non-deductible financial transactions levy
Other non-deductible expenses
Effect of overseas tax rates
Deferred tax assets not recognised
Income tax applied to companies in tax loss in overseas jurisdiction
Movement in deferred taxes
Income tax expense/(benefit)
2,153,494
137,085
2,290,579
1,609,485
117,125
1,726,610
2,596,366
130,217
2,726,583
2,630,758
189,107
2,819,865
598,457
65,712
5,615,619
4,612,187
Consolidated
2020
$
2019
$
6,612
81,277
41,880
(82,223)
87,889
(40,343)
81,277
(82,223)
(3,528,088)
(6,042,631)
(970,224)
(1,722,150)
63,198
1,834
68,030
(210,504)
21,629
7,308
223,233
32,834
762,649
6,612
190,815
18,178
156,703
8,793
29,842
6,718
131,401
96,623
1,083,077
41,468
6,599
81,290
41,468
(81,811)
87,889
(40,343)
ANNUAL REPORT 2020 51
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 7. Income tax (continued)
Deferred tax liability
Deferred tax liability comprises temporary differences attributable to:
Amounts recognised in profit or loss:
Property, plant and equipment
Intangible assets
Allowance for expected credit losses
Lease liabilities
Deferred tax liability
Movements:
Opening balance
Charged/(credited) to profit or loss
Closing balance
Note 8. Current assets - cash and cash equivalents
Cash at bank
Note 9. Current assets - trade and other receivables
Trade receivables
Less: Allowance for expected credit losses
Other receivables
Indirect taxes receivable
Consolidated
2020
$
2019
$
31,082
257,801
(176,524)
(31,082)
81,277
-
-
-
-
-
-
81,277
82,223
(82,223)
81,277
-
Consolidated
2020
$
2019
$
10,796,484
7,149,683
Consolidated
2020
$
2019
$
3,603,545
(866,708)
2,736,837
3,576,937
(884,467)
2,692,470
6,651
1,013,037
9,718
700,840
3,756,525
3,403,028
Allowance for expected credit losses
The Group has recognised a loss of $54,386 (2019: $669,527) in profit or loss in respect of the expected credit losses for
the year ended 31 December 2020.
The ageing of the receivables (current and non-current) and allowance for expected credit losses provided for above are as
follows:
ANNUAL REPORT 2020 52
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 9. Current assets - trade and other receivables (continued)
Consolidated
Not overdue
0 to 3 months overdue
3 to 6 months overdue
6 to 12 months overdue
Over 6 months overdue
Expected credit loss rate
Carrying amount
2020
%
2019
%
2020
$
2019
$
Allowance for expected
credit losses
2020
$
2019
$
-
6.46%
75.00%
100.00%
100.00%
-
3.89%
50.00%
75.00%
100.00%
3,279,190
453,659
124,012
56,992
687,380
2,388,217
241,109
92,148
105,837
749,626
-
29,327
93,009
56,992
687,380
-
9,389
46,074
79,378
749,626
4,601,233
3,576,937
866,708
884,467
Opening balance
Additional provisions recognised
Amounts recovered during the year
Foreign exchange differences
Closing balance
Note 10. Current assets - inventories
Merchandise not manufactured by the Group - at cost
Materials and spare parts - at cost
Less: Provision for impairment
Consolidated
2020
$
2019
$
884,467
52,755
-
(70,514)
263,318
666,222
(43,756)
(1,317)
866,708
884,467
Consolidated
2020
$
2019
$
371,627
53,877
(35,836)
183,474
61,642
(137,762)
389,668
107,354
The cost of inventories recognised as an expense during the year ended 31 December 2020 was $1,433,397 (2019:
$1,090,415).
The cost of inventories recognised as an expense includes $86,617 (2019: write downs of $63,784) in respect of reversal of
write downs of inventory to net realisable value.
Note 11. Current assets - other
Prepayments
Other receivables
Consolidated
2020
$
2019
$
27,354
274,833
16,800
233,819
302,187
250,619
ANNUAL REPORT 2020 53
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 12. Non-current assets - trade receivables
Trade receivables
Consolidated
2020
$
2019
$
997,688
-
Refer to note 9 for an analysis of ageing of the receivables and allowance for expected credit losses.
Note 13. Non-current assets - property, plant and equipment
Leasehold improvements - at cost
Less: Accumulated depreciation
Furniture and fittings - at cost
Less: Accumulated depreciation
Computer equipment - at cost
Less: Accumulated depreciation
Medical equipment - at cost
Less: Accumulated depreciation
Consolidated
2020
$
2019
$
32,340
(359)
31,981
23,117
(13,922)
9,195
-
-
-
26,286
(8,709)
17,577
1,435,049
(773,137)
661,912
1,640,412
(433,092)
1,207,320
3,259,322
(616,117)
2,643,205
2,519,140
(368,031)
2,151,109
3,346,293
3,376,006
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 January 2019
Additions
Disposals
Exchange differences
Depreciation expense
Balance at 31 December 2019
Additions
Disposals
Exchange differences
Depreciation expense
Leasehold
improvements
$
Furniture and
fittings
$
Computer
equipment
$
Medical
equipment
$
-
-
-
-
-
-
33,066
-
(718)
(367)
17,088
6,203
(364)
(57)
(5,293)
17,577
18,647
(19,091)
(2,777)
(5,161)
793,274
781,941
(21,782)
(2,631)
(343,482)
1,207,320
75,014
(92,233)
(130,017)
(398,172)
780,749
1,552,571
(8,979)
(3,834)
(169,398)
2,151,109
1,138,188
(61,319)
(263,084)
(321,689)
Total
$
1,591,111
2,340,715
(31,125)
(6,522)
(518,173)
3,376,006
1,264,915
(172,643)
(396,596)
(725,389)
Balance at 31 December 2020
31,981
9,195
661,912
2,643,205
3,346,293
ANNUAL REPORT 2020 54
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 14. Non-current assets - right-of-use assets
Land and buildings - right-of-use
Less: Accumulated depreciation
Consolidated
2020
$
2019
$
153,185
(51,139)
133,288
(92,483)
102,046
40,805
The Group leases land and buildings for its offices under agreements of between 1 to 5 years with, in some cases, options
to extend. The leases have various escalation clauses. On renewal, the terms of the leases are renegotiated.
The Group leases office equipment under agreements of less than 1 year. These leases are either short-term or low-value,
so have been expensed as incurred and not capitalised as right-of-use assets.
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 January 2019
Modifications of lease terms
Exchange differences
Depreciation expense
Balance at 31 December 2019
Additions
Modifications of lease terms
Exchange differences
Depreciation expense
Balance at 31 December 2020
Note 15. Non-current assets - intangibles
Internally developed software - at cost
Copyright - at cost
Less: Accumulated amortisation
Licenses - at cost
Less: Accumulated amortisation
Land and
buildings
$
129,436
4,417
(193)
(92,855)
40,805
159,257
(2,341)
(6,202)
(89,473)
102,046
Consolidated
2020
$
2019
$
805,629
-
24,275
(18,198)
6,077
27,768
(17,355)
10,413
892,058
(590,508)
301,550
959,465
(499,991)
459,474
1,113,256
469,887
ANNUAL REPORT 2020 55
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 15. Non-current assets - intangibles (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 January 2019
Additions
Exchange differences
Amortisation expense
Balance at 31 December 2019
Additions
Disposals
Exchange differences
Amortisation expense
Internally
developed
software
$
-
-
-
-
-
805,629
-
-
-
Copyright
$
Licences
$
Total
$
13,535
-
368
(3,490)
10,413
-
-
(1,228)
(3,108)
513,833
159,201
(2,149)
(211,411)
459,474
115,806
(12,177)
(55,137)
(206,416)
527,368
159,201
(1,781)
(214,901)
469,887
921,435
(12,177)
(56,365)
(209,524)
Balance at 31 December 2020
805,629
6,077
301,550
1,113,256
Note 16. Current liabilities - trade and other payables
Trade payables
Withholding tax payable
Other payables
Refer to note 23 for further information on financial instruments.
Note 17. Current liabilities - contract liabilities
Contract liabilities
Reconciliation
Reconciliation of the written down values at the beginning and end of the current and
previous financial year are set out below:
Opening balance
Payments received in advance
Transfer to revenue - included in the opening balance
Exchange differences
Closing balance
Consolidated
2020
$
2019
$
1,457,945
617,161
307,425
870,151
442,511
112,541
2,382,531
1,425,203
Consolidated
2020
$
2019
$
53,548
63,936
63,936
42,533
(45,837)
(7,084)
91,480
48,868
(76,412)
-
53,548
63,936
ANNUAL REPORT 2020 56
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 17. Current liabilities - contract liabilities (continued)
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 $53,548 as at 31 December 2020 ($63,936 as at 31 December 2019) and is expected to be recognised
as revenue in future periods as follows:
Within 6 months
6 to 12 months
12 to 18 months
Note 18. Current liabilities - borrowings
Credit cards
Unsecured Revolving Credit Loans
Unsecured Fixed term loans
Unsecured other loans
PaaS equipment financing loan*
Consolidated
2020
$
2019
$
24,042
1,868
27,638
60,845
3,091
-
53,548
63,936
Consolidated
2020
$
2019
$
2,759
40,833
808,588
-
16,597
6,866
91,652
612,501
4,388
517,182
868,777
1,232,589
*
Relates to various loans provided to the Company for PaaS contracts where the equipment is repaid at a 200% rate of
return on their loan which is paid in monthly instalments over the initial term of the PaaS contract.
Refer to note 19 for further information on assets pledged as security and financing arrangements.
Refer to note 23 for further information on financial instruments.
Note 19. Non-current liabilities - borrowings
Unsecured revolving credit loans
Unsecured fixed term loans
Secured loans from related parties
Cost of borrowing*
Consolidated
2020
$
2019
$
40,056
687,895
-
-
13,276
585,047
1,000,000
(771,429)
727,951
826,894
*
The cost of borrowing relates to the net amortised value of the cost of options issued on the loan to Domatorisaro Pty
Ltd, a related party of Dr Douglas Lingard. The cost of the options is amortised over the length of the loan. This loan
comprised two possible tranches of $1,000,000 each at an annual interest rate of 12.5% on each tranche and 4% on
the facility. The loan was repaid during the financial year ended 31 December 2020.
Refer to note 23 for further information on financial instruments.
ANNUAL REPORT 2020 57
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 19. Non-current liabilities - borrowings (continued)
Total secured liabilities
The total secured liabilities (current and non-current) are as follows:
Secured loans from related parties
Consolidated
2020
$
2019
$
-
1,000,000
Assets pledged as security
The secured loans from related parties were secured by a $1,000,000 term deposit included in cash and cash equivalents.
Financing arrangements
Unrestricted access was available at the reporting date to the following lines of credit:
Total facilities
Unsecured revolving credit loans
Unsecured fixed term loans
Unsecured other loans
Used at the reporting date
Unsecured revolving credit loans
Unsecured fixed term loans
Unsecured other loans
Unused at the reporting date
Unsecured revolving credit loans
Unsecured fixed term loans
Unsecured other loans
Note 20. Equity - issued capital
Consolidated
2020
$
2019
$
80,889
1,496,483
-
1,577,372
104,928
1,197,548
4,388
1,306,864
80,889
1,496,483
-
1,577,372
104,928
1,197,548
4,388
1,306,864
-
-
-
-
-
-
-
-
Ordinary shares - fully paid
29,699,842 1,175,657,186 28,461,991 19,757,466
Consolidated
2020
Shares
2019
Shares
2020
$
2019
$
ANNUAL REPORT 2020 58
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 20. Equity - issued capital (continued)
Movements in ordinary share capital
Details
Date
Shares
Issue price
$
Balance
Issue of shares pursuant to placement
Share issue transaction costs, net of tax
Issue of lead advisor options
Balance
Issue of shares
Conversion of class A performance shares
Issue of shares
Issue of shares
Consolidation of shares 50 to 1
Share issue transaction costs, net of tax
1 January 2019
24 October 2019
24 October 2019
31 December 2019
26 May 2020
23 July 2020
30 October 2020
30 October 2020
6 November 2020
925,657,186
250,000,000
-
-
1,175,657,186
16,666,667
6
276,000,000
16,666,667
(1,455,290,684)
-
10,553,259
$0.040 10,000,000
(675,793)
$0.000
(120,000)
$0.000
19,757,466
500,000
-
8,280,000
500,000
-
(575,475)
$0.030
$0.030
$0.030
$0.030
$0.000
$0.000
Balance
31 December 2020
29,699,842
28,461,991
Ordinary shares
Ordinary shares entitle the holder to participate in any dividends declared and any proceeds attributable to shareholders
should the Company be wound up, in proportions that consider both the number of shares held and the extent to which those
shares are paid up. 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.
Class A performance shares
The Company had 750,000 unquoted class A performance shares. These class A performance shares were converted into
6 ordinary shares on 23 July 2020.
Share buy-back
There is no current on-market share buy-back.
Capital risk management
The Group's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide
returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost
of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated
as total borrowings less cash and cash equivalents.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return
capital to shareholders, issue new shares or sell assets to reduce debt.
The Group would look to raise capital when an opportunity to invest in a business or company was seen as value adding
relative to the current Company's share price at the time of the investment. The Group is not actively pursuing additional
investments in the short term as it continues to integrate and grow its existing businesses in order to maximise synergies.
The Group is subject to certain financing arrangements covenants and meeting these is given priority in all capital risk
management decisions. There have been no events of default on the financing arrangements during the financial year.
The capital risk management policy remains unchanged from the 31 December 2019 Annual Report.
ANNUAL REPORT 2020 59
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 21. Equity - reserves
Foreign currency reserve
Share-based payments reserve
Options reserve
Consolidated
2020
$
2019
$
(519,327)
3,076,937
30,440
(21,232)
2,478,480
-
2,588,050
2,457,248
Foreign currency reserve
The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign
operations to Australian dollars. It is also used to recognise gains and losses on hedges of the net investments in foreign
operations.
Share-based payments reserve
The reserve is used to recognise the value of equity benefits provided to employees and directors as part of their
remuneration, and other parties as part of their compensation for services.
Options reserve
The reserve is used to record amounts received from option holders from the issue of options.
Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
Consolidated
Foreign
currency
reserve
$
Share-based
payments
reserve
$
Options
reserve
$
Balance at 1 January 2019
Foreign currency translation
Share-based payments - options issued pursuant to loan
agreement
Share-based payments - options issued to advisor pursuant to
placement
Share-based payments - options issued to KMP
Amounts paid on issue of options
(15,392)
(5,840)
1,208,718
-
-
-
-
-
1,080,000
120,000
65,712
4,050
Total
$
1,193,326
(5,840)
1,080,000
120,000
65,712
4,050
-
-
-
-
-
-
Balance at 31 December 2019
Foreign currency translation
Share-based payments - options issued to KMP
Amounts paid on issue of options
(21,232)
(498,095)
-
-
2,478,480
-
598,457
-
-
-
-
30,440
2,457,248
(498,095)
598,457
30,440
Balance at 31 December 2020
(519,327)
3,076,937
30,440
2,588,050
Note 22. Equity - dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
ANNUAL REPORT 2020 60
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 23. Financial instruments
Financial risk management objectives
The Group's activities expose it to a variety of financial risks: market risk (including foreign currency risk, price risk and
interest rate risk), credit risk and liquidity risk. The Group'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 Group. The Group
uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis
in the case of interest rate, foreign exchange and other price risks and ageing analysis for credit risk.
Risk management is carried out by senior finance executives ('finance') under policies approved by the Board of Directors
('the Board'). These policies include identification and analysis of the risk exposure of the Group and appropriate procedures,
controls and risk limits.
Market risk
Foreign currency risk
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities that are denominated
in a currency that is not the Company’s functional currency. Individual transactions are assessed, and forward exchange
contracts are used to hedge the risk where deemed appropriate.
While the Group as a whole has assets and liabilities in different currencies, individual entities in the Group do not have a
significant foreign exchange exposure to receivables or payables in currencies that are not their functional currency.
The carrying amount of the Group's foreign currency denominated financial assets and financial liabilities at the reporting
date were as follows:
Consolidated
US dollars
Euros
Colombian peso
Assets
2020
$
2019
$
Liabilities
2020
$
2019
$
322,814
22,748
4,556,964
246,708
-
3,476,151
784,699
-
551,517
32,706
9,909
389,768
4,902,526
3,722,859
1,336,216
432,383
Based on the financial instruments held at 31 December 2020, had the Australian dollar weakened by 5% against the
Colombian Peso, US Dollar and Euro, with all other variables held constant, the Group’s pre-tax profit for the year would
have been $27,962 higher (2019: $149,228 higher). If the Australian dollar had strengthened the corresponding impact would
have been a decrease in pre-tax profit by the same amount.
Price risk
The Group is not exposed to any significant price risk.
Interest rate risk
The Group’s main interest rate risk arises from borrowings with variable rates, which expose the Group to cash flow interest
rate risk. Group policy is to have mainly fixed rate loans directly. During the financial years ended 31 December 2020 and
31 December 2019, the Group’s borrowings at variable rate were denominated in Colombian Pesos. The Group’s borrowings
and receivables are carried at amortised cost.
The Group is exposed to interest rate risk at the date of this report via its cash holdings.
The exposure of the Group’s borrowings to interest rate changes and the contractual re-pricing dates of the borrowings at
the end of the reporting period are as follows:
ANNUAL REPORT 2020 61
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 23. Financial instruments (continued)
% of total
% of total
2020
$
loans
%
2019
$
loans
%
Variable rate borrowings
Fixed rate borrowings (no repricing dates)
2,759
1,577,373
0.2
99.8
6,866
2,306,864
0.3
99.7
1,580,132
100.0
2,313,730
100.0
Due to the carrying value of borrowings at variable interest rate, the Group is not exposed to any significant interest rate risk.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group has a strict code of credit, including obtaining agency credit information, confirming references and setting
appropriate credit limits. The Group obtains guarantees where appropriate to mitigate credit risk. 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 Group does not
hold any collateral.
The Group has adopted a lifetime expected loss allowance in estimating expected credit losses to trade receivables through
the use of a provisions matrix using fixed rates of credit loss provisioning. These provisions are considered representative
across all customers of the Group based on recent sales experience, historical collection rates and forward-looking
information that is available.
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include
the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual
payments for a period greater than 1 year.
Liquidity risk
Vigilant liquidity risk management requires the Group 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 Group manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously
monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.
Remaining contractual maturities
The following tables detail the Group's remaining contractual maturity for its financial instrument liabilities. The tables have
been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial
liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual
maturities and therefore these totals may differ from their carrying amount in the statement of financial position.
Consolidated - 2020
< 6 months
$
6-12
months
$
Between 1
and 2 years
$
Between 2
and 5 Years
$
Over 5
Years
$
Trade payables
Other payables
Lease liabilities
Borrowings - variable rate
Borrowings - fixed rate
1,457,945
307,425
101,469
2,759
146,728
-
-
-
-
117,780
-
-
-
-
447,937
-
-
-
-
867,686
Total
contractual
cash flows
$
Carrying
amount
$
- 1,457,945 1,457,945
307,425
-
-
101,469
2,759
-
- 1,580,132 1,580,132
307,425
101,469
2,759
2,016,326
117,780
447,937
867,686
- 3,449,730 3,449,730
ANNUAL REPORT 2020 62
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 23. Financial instruments (continued)
Consolidated - 2019
< 6 months
$
6-12
months
$
Between 1
and 2 years
$
Between 2
and 5 Years
$
Over 5
Years
$
Trade payables
Other payables
Lease liabilities
Borrowings - variable rate
Borrowings - fixed rate
870,151
112,541
40,574
6,866
-
-
-
-
-
-
-
-
-
116,567 1,562,484
-
-
-
-
627,814
Total
contractual
cash Flows
$
Carrying
amount
$
870,151
112,541
40,574
6,866
870,151
-
112,541
-
40,574
-
-
6,866
- 2,306,865 1,535,435
1,030,132
116,567 1,562,484
627,814
- 3,336,997 2,565,567
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
Note 24. Key management personnel disclosures
Compensation
The aggregate compensation made to directors and other members of key management personnel of the Group is set out
below:
Short-term employee benefits
Post-employment benefits
Share-based payments
Consolidated
2020
$
2019
$
796,289
62,319
565,023
1,037,844
57,742
65,712
1,423,631
1,161,298
ANNUAL REPORT 2020 63
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 25. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by Nexia Sydney Audit Pty Ltd and
BDO Audit (WA) Ltd, the auditor of the Company, and its network firms:
Audit services - Nexia Sydney Audit Pty Ltd/BDO Audit (WA) Pty Ltd
Audit or review of the financial statements - Nexia Sydney Audit Pty Ltd
Audit or review of the financial statements - BDO Audit (WA) Pty Ltd
Other services - Nexia Sydney Audit Pty Ltd/BDO Audit (WA) Pty Ltd
Preparation of the tax return - Nexia Sydney Audit Pty Ltd
Preparation of the tax return - BDO Audit (WA) Pty Ltd
Audit services - network firms
Audit or review of the financial statements
Other services - network firms
Other
Consolidated
2020
$
2019
$
26,500
41,601
-
71,847
-
18,762
86,863
-
9,862
81,709
31,835
46,999
1,341
660
120,039
129,368
On 30 October 2020, Nexia Sydney Audit Pty Ltd was appointed auditor or the Company following the removal of BDO Audit
(WA) Pty Ltd. During the financial year ended 31 December 2020, the fees presented in the table above represent fees which
were paid or payable for services provided by BDO Audit (WA) Pty Ltd up until 30 October 2020 and fees which were paid
or payable for services provided by Nexia Sydney Audit Pty Ltd thereafter.
Note 26. Contingent liabilities
The Group had no contingent liabilities as at 31 December 2020 (2019: none)
Note 27. Related party transactions
Parent entity
IMEXHS Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 29.
Joint operations
Interests in joint operations are set out in note 30.
Key management personnel
Disclosures relating to key management personnel are set out in note 24 and the remuneration report included in the
directors' report.
ANNUAL REPORT 2020 64
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 27. Related party transactions (continued)
Transactions with related parties
The following transactions occurred with related parties:
Sale of goods and services:
Sale of goods to key management personnel
Payment for goods and services:
Purchase of fixed assets from key management personnel
Payment for services from key management personnel
Payment for other expenses:
Interest paid to key management personnel - on secured loans
Interest paid to key management personnel - on PaaS equipment financing loan
Consolidated
2020
$
2019
$
4,432,817
3,382,898
-
1,186,519
348,067
1,775,967
-
87,198
95,591
272,488
Receivable from and payable to related parties
The following balances are outstanding at the reporting date in relation to transactions with related parties:
Current receivables:
Trade receivables from key management personnel
Current payables:
Trade payables to key management personnel
Consolidated
2020
$
2019
$
739,461
1,937,969
1,628
264,257
Loans to/from related parties
The following balances are outstanding at the reporting date in relation to loans with related parties:
Non-current borrowings:
Loan from key management personnel - secured loans
Loan from key management personnel - PaaS equipment financing loan
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
Consolidated
2020
$
2019
$
-
7,115
1,000,000
420,399
ANNUAL REPORT 2020 65
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 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 loss
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Share-based payments reserve
Options reserve
Accumulated losses
Total equity
Parent
2020
$
2019
$
(10,419,073)
(11,341,404)
(10,419,073)
(11,341,404)
Parent
2020
$
2019
$
9,324,261 10,866,778
9,326,465 10,869,936
5,109
880
5,109
229,451
32,142,799 23,438,273
2,366,141
-
(15,163,929)
2,731,118
30,440
(25,583,001)
9,321,356 10,640,485
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity had no guarantees in relation to the debts of its subsidiaries as at 31 December 2020 and 31 December
2019.
Contingent liabilities
The parent entity had no contingent liabilities as at 31 December 2020 and 31 December 2019.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment as at 31 December 2020 and 31 December
2019.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 2, except for the
following:
●
●
●
Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.
Investments in associates are accounted for at cost, less any impairment, in the parent entity.
Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an
indicator of an impairment of the investment.
ANNUAL REPORT 2020 66
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 29. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance
with the accounting policy described in note 2:
Name
Principal place of business /
Country of incorporation
OMT Operations (AU) Pty Ltd*
Imaging Experts and Healthcare Services Pty Ltd
Imaging Experts and Healthcare Services S.A.S.
IMEXHS Corp
IMEXVR SAS*
IMEXMB SAS*
Dictatech Inc*
Australia
Australia
Colombia
US
Colombia
Colombia
US
*
Dormant.
Note 30. Interests in joint operations
Ownership interest
2019
2020
%
%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
-
100.00%
100.00%
100.00%
The Group has recognised its share of jointly held assets, liabilities, revenues and expenses of joint operations. These have
been incorporated in the financial statements under the appropriate classifications. Information relating to joint operations
that are material to the Group are set out below:
Name
Principal place of business /
Country of incorporation
Ownership interest
2019
2020
%
%
Hospital Central Policía Nacional (National Police
Hospital)
Colombia
30.00%
30.00%
Note 31. Changes in liabilities arising from financing activities
Consolidated
Balance at 1 January 2019
Net cash from/(used in) financing activities
Adoption of AASB 16
Modification of lease terms
Exchange differences
Balance at 31 December 2019
Net cash used in financing activities
Acquisition of leases
Modifications of lease terms
Unwinding deferred borrowing costs
Borrowings
$
Lease
liabilities
$
440,233
1,619,250
-
-
-
2,059,483
(1,234,184)
-
-
771,429
-
(93,085)
129,436
4,407
(184)
40,574
(96,021)
159,257
(2,341)
-
Total
$
440,233
1,526,165
129,436
4,407
(184)
2,100,057
(1,330,205)
159,257
(2,341)
771,429
Balance at 31 December 2020
1,596,728
101,469
1,698,197
ANNUAL REPORT 2020 67
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 32. Earnings per share
Consolidated
2020
$
2019
$
Loss after income tax attributable to the owners of IMEXHS Limited
(3,615,977)
(6,002,288)
Weighted average number of ordinary shares used in calculating basic earnings per share
24,730,188 19,458,381
Weighted average number of ordinary shares used in calculating diluted earnings per share 24,730,188 19,458,381
Number
Number
Basic earnings per share
Diluted earnings per share
Cents
Cents
(14.62)
(14.62)
(30.85)
(30.85)
The weighted average number of ordinary shares in the comparative period are calculated based on the number of shares
that would have been in existence had the capital restructure occurred on 1 January 2019.
Share options on issue have been excluded from the weighted average number of ordinary shares used in calculating diluted
loss per share as they are considered anti-dilutive.
ANNUAL REPORT 2020 68
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 33. Share-based payments
Options granted to key management personnel and external parties are as follows:
●
●
●
●
●
●
●
●
●
●
●
●
●
On 22 July 2017, 700,000 shares options (35,000,000 share options prior to the share consolidation) were granted to
key management personnel. The options have vested, have an exercise price of $1.25 ($0.025 prior to the share
consolidation) and expire on 31 March 2021.
On 28 August 2018, 1,000,001 Class A share options (50,000,000 Class A share options prior to the share
consolidation) were granted to key management personnel. The options vested immediately on grant date, have an
exercise price of $2.50 ($0.050 prior to the share consolidation) and expire on 30 June 2021.
On 28 August 2018, 1,000,001 Class B share options (50,000,000 Class B share options prior to the share
consolidation) were issued as consideration for Imaging Experts and Healthcare Services Pty Ltd. The options are
subject to the vesting condition of the Group exceeding $5,000,000 EBIT in any rolling four quarter period. The
options have an exercise price of $1.875 ($0.038 prior to the share consolidation) and expire on 28 August 2023.
On 28 August 2018, 1,000,001 Class C share options (50,000,000 Class C share options prior to the share
consolidation) were issued as consideration for Imaging Experts and Healthcare Services Pty Ltd. The options are
subject to the vesting condition of the Group exceeding $7,500,000 EBIT in any rolling four quarter period. The
options have an exercise price of $1.875 ($0.038 prior to the share consolidation) and expire on 28 August 2023.
On 28 August 2018, 250,000 shares options (12,500,000 share options prior to the share consolidation) were
granted to key management personnel. The options vested immediately on the grant date, have an exercise price of
$1.875 ($0.038 prior to the share consolidation) and expire on 30 June 2021.
On 28 August 2018, 600,000 shares options (30,000,000 share options prior to the share consolidation) were
granted to third party advisors in exchange for services provided. The options vested immediately on the grant date,
have an exercise price of $2.50 ($0.050 prior to the share consolidation) and expire on 30 June 2021.
On 25 October 2018, 80,000 share options (4,000,000 shares options prior to the share consolidation) were issued as
remuneration to Non-Executive Director, Mr Tom Pascarella subject to vesting conditions. The options vested when
Mr Tom Pascarella resigned on 30 November 2019. The options have an exercise price of $3.50 ($0.070 prior to the
share consolidation) and expire on 25 October 2023.
On 10 December 2018, 40,000 share options (2,000,000 shares options prior to the share consolidation) were issued
as remuneration to Non-Executive Director, Dr Douglas Lingard subject to vesting conditions. 10,000 options vested
on 10 December 2020 and the remaining 30,000 options vest on 10 December 2021, have an exercise price of $2.65
($0.053 prior to the share consolidation) and expire on 9 December 2023.
On 7 October 2019, 800,000 share options (40,000,000 shares options prior to the share consolidation) were issued
to Domatorisaro Pty Ltd, a related party of Dr Douglas Lingard, pursuant to a loan agreement. The options vested
immediately on the grant date, have an exercise price of $2.70 ($0.054 prior to the share consolidation) and expire on
31 March 2022.
On 31 October 2019, 100,000 share options (5,000,000 prior to the share consolidation) were granted to third party
advisors in exchange for services provided. The options vested immediately on the grant date, have an exercise price
of $2.70 ($0.054 prior to the share consolidation) and expire on 30 September 2022.
On 1 April 2020, 30,000 share options (1,500,000 share options prior to the share consolidation) were granted to an
employee. The options vest when the Company's share price reaches or exceeds a 10 day VWAP of $4.45 (8.5 cents
pre-consolidation). The options have an exercise price of $3.25 ($0.065 prior to the share consolidation) and expire on
1 April 2022.
On 1 April 2020, 30,000 share options (1,500,000 share options prior to the share consolidation) were granted to an
employee. The options vest when the Company's share price reaches or exceeds a 10 day VWAP of $7.50 (15 cents
pre-consolidation). The options have an exercise price of $5.00 ($0.10 prior to the share consolidation) and expire on
1 April 2023.
On 26 May 2020, 560,000 share options (28,000,000 share options prior to the share consolidation) were granted to
Mr Douglas Flynn as part of his appointment as Non-Executive Chairman. The grant consists of 3 tranches, tranche 1
and 2 each comprise of 160,000 options and tranche 3 comprises of 240,000 options. Tranche 1 and 2 vest on 26
May 2020 and tranche 3 vests when the Company's share price reaches or exceeds a 30 day VWAP of $6.00 (12
cents prior to the share consolidation). Tranche 1, 2 and 3 have an exercise price of $2.75, $3.50 and $1.50
respectively ($0.055, $0.070 and $0.030 respectively prior to the share consolidation). All tranches expire on 12
March 2027.
ANNUAL REPORT 2020 69
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 33. Share-based payments (continued)
Set out below are summaries of options granted:
2020
Grant date
Expiry date
Exercise
price
22/07/2017
28/08/2018
28/08/2018
28/08/2018
28/08/2018
28/08/2018
25/10/2018
10/12/2018
07/10/2019
31/10/2019
01/04/2020
01/04/2020
26/05/2020
26/05/2020
26/05/2020
31/03/2021
30/06/2021
28/08/2023
28/08/2023
30/06/2021
30/06/2021
25/10/2023
09/12/2023
31/03/2022
30/09/2022
01/04/2022
01/04/2023
12/03/2027
12/03/2027
12/03/2027
$1.250
$2.500
$1.875
$1.875
$1.875
$2.500
$3.500
$2.650
$2.700
$2.700
$3.250
$5.000
$2.750
$3.500
$1.500
Balance at
the start of
the year
35,000,000
50,000,000
50,000,000
50,000,000
12,500,000
30,000,000
4,000,000
2,000,000
40,000,000
5,000,000
-
-
-
-
-
278,500,000
Granted
Exercised
-
-
-
-
-
-
-
-
-
-
1,500,000
1,500,000
8,000,000
8,000,000
12,000,000
31,000,000
Expired/
forfeited/
other*
Balance at
the end of
the year
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(34,300,000)
(48,999,999)
(48,999,999)
(48,999,999)
(12,250,000)
(29,400,000)
(3,920,000)
(1,960,000)
(39,200,000)
(4,900,000)
(1,470,000)
(1,470,000)
(7,840,000)
(7,840,000)
(11,760,000)
(303,309,997)
700,000
1,000,001
1,000,001
1,000,001
250,000
600,000
80,000
40,000
800,000
100,000
30,000
30,000
160,000
160,000
240,000
6,190,003
Weighted average exercise price
$2.140
$2.590
$0.000
$2.180
$2.180
*
On 6 November 2020, the Company consolidated its options on a basis of 50 to 1.
2019
Grant date
Expiry date
22/07/2017
28/08/2018
28/08/2018
28/08/2018
28/08/2018
28/08/2018
25/10/2018
10/12/2018
07/10/2019
31/10/2019
31/03/2021
30/06/2021
28/08/2023
28/08/2023
30/06/2021
30/06/2021
25/10/2023
09/12/2023
31/03/2022
30/09/2022
Exercise
price
$0.025
$0.050
$0.038
$0.038
$0.038
$0.050
$0.070
$0.053
$0.054
$0.054
Balance at
the start of
the year
35,000,000
50,000,000
50,000,000
50,000,000
12,500,000
30,000,000
4,000,000
2,000,000
-
-
233,500,000
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
-
-
-
-
-
-
40,000,000
5,000,000
45,000,000
-
-
-
-
-
-
-
-
-
-
-
35,000,000
-
50,000,000
-
50,000,000
-
50,000,000
-
12,500,000
-
30,000,000
-
4,000,000
-
2,000,000
-
40,000,000
-
-
5,000,000
- 278,500,000
Weighted average exercise price
$0.041
$0.054
$0.000
$0.000
$0.043
ANNUAL REPORT 2020
70
IMEXHS Limited
Notes to the financial statements
31 December 2020
Note 33. Share-based payments (continued)
Set out below are the options exercisable at the end of the financial year:
Grant date
Expiry date
22/07/2017
28/08/2018
28/08/2018
28/08/2018
25/10/2018
10/12/2018
07/10/2019
31/10/2019
01/04/2020
26/05/2020
26/05/2020
31/03/2021
30/06/2021
30/06/2021
30/06/2021
25/10/2023
09/12/2023
31/03/2022
30/09/2022
01/04/2022
12/03/2027
12/03/2027
2020
Number
2019
Number
700,000
1,000,001
250,000
600,000
80,000
10,000
800,000
100,000
30,000
160,000
160,000
35,000,000
50,000,000
12,500,000
30,000,000
4,000,000
-
40,000,000
5,000,000
-
-
-
3,890,001 176,500,000
The weighted average share price during the financial year was $1.60 (2019: $1.96).
The weighted average remaining contractual life of options outstanding at the end of the financial year was 1.85 years (2019:
2.38 years).
For the options granted during the current financial year, the valuation model inputs used to determine the fair value at the
grant date, are as follows:
Grant date
Expiry date
01/04/2020
01/04/2020
26/05/2020
26/05/2020
26/05/2020
01/04/2022
01/04/2023
12/03/2027
12/03/2027
12/03/2027
Share price
at grant date
Exercise
price
Expected
volatility
Dividend
yield
Risk-free
Fair value
interest rate at grant date
$1.200
$1.200
$1.750
$1.750
$1.750
$3.250
$5.000
$2.750
$3.500
$1.500
100.00%
100.00%
100.00%
100.00%
100.00%
-
-
-
-
-
0.21%
0.21%
0.46%
0.46%
0.46%
$0.350
$0.400
$1.300
$1.250
$1.350
Note 34. Events after the reporting period
On 2 March 2021, 301,680 share options were exercised and on 9 March 2021, 193,320 share options were exercised. The
share options were granted on 22 July 2017 and had an exercise price of $1.25 per share option.
On 4 March 2021, 140,000 share options were granted to Ms Reena Minhas, the Group's Chief Financial Officer and
Company Secretary. The share options have an exercise price of $nil and expire on the 1 March 2031.
The consequences of the Coronavirus (COVID-19) pandemic are continuing to be felt around the world, and its impact on
the Group, if any, has been reflected in its published results to date. Whilst it would appear that control measures and related
government policies, including the roll out of the vaccine, have started to mitigate the risks caused by COVID-19, it is not
possible at this time to state that the pandemic will not subsequently impact the company's operations going forward. The
Group now has experience in the swift implementation of business continuation processes should future lockdowns of the
population occur, and these processes continue to evolve to minimise any operational disruption. Management continues to
monitor the situation both locally and internationally.
No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may significantly
affect the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
ANNUAL REPORT 2020
71
IMEXHS Limited
Directors' declaration
31 December 2020
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 2 to the financial statements;
the attached financial statements and notes give a true and fair view of the Group's financial position as at 31 December
2020 and of its performance for the financial year ended on that date; and
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable.
The directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the directors
___________________________
Douglas Flynn
Chairman
29 March 2021
ANNUAL REPORT 2020
72
Independent Auditor’s Report to the Members of IMEXHS Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of IMEXHS Limited (the Company and its subsidiaries (the Group)), which
comprises the consolidated statement of financial position as at 31 December 2020, 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 financial statements, including a summary of
significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
i) giving a true and fair view of the Group’s financial position as at 31 December 2020 and of its financial
performance for the year then ended; and
ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the ‘auditor’s responsibilities for the audit of the financial report’ section of
our report. We are independent of the Group in accordance with the Corporations Act 2001 and the ethical
requirements of the Accounting Professional & Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report
in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial report of the current period. These matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
73
Key audit matter
How our audit addressed the key audit matter
Revenue recognition
Refer to note 5 in the financial
report.
Revenue recognition is considered
a key audit matter as it is the
most significant balance in the
Group’s Statement of Profit or
Loss and Other Comprehensive
Income, and is the key driver to
the Group’s performance.
Furthermore, there are
complexities and significant
management judgements
associated with interpreting the
key contractual terms of revenue
contracts entered into by the
Group against the requirements of
the AASB 15 ‘Revenue from
Contracts with Customers’ (AASB
15).
Recoverability of trade receivables
– valuation of the expected credit
loss provision.
Refer to notes 9 and 12 in the
financial report.
The recoverability and valuation
of trade receivables is considered
a key audit matter due to the
quantum of the receivable balance
and the use of significant
management estimates and
judgements in determining
expected credit losses in
accordance with AASB 9 ‘Financial
Instruments’ (AASB 9).
Our audit procedures in respect of this area included but were not limited
to the following:
Assessing the adequacy of the disclosures in notes 2 and 5 of the
financial report.
Instructing and reviewing the audit work papers of the component
auditor in Columbia, which included the following specific procedures:
-
-
-
obtaining and reviewing a sample of contracts, considering their
terms and conditions and identification of the performance
obligations in those arrangements, and assessing their
accounting treatment under AASB 15;
Testing a sample of revenue transactions to sales contracts
signed by customers;
Performing cut-off testing for a sample of contracts to determine
whether revenue had been recorded in the correct accounting
period based on their contractual terms;
Testing the material revenue contracts, including considering their
terms and conditions and identification of the performance
obligations in those arrangements and assessing their accounting
treatment under AASB 15.
Our audit procedures in respect of this area included but were not limited
to the following:
Instructing and reviewing the audit work papers of the component
auditor in Columbia, which included the following specific procedures:
-
Testing, on a sample basis, the recognition of accounts receivable
in accordance with the Group’s accounting policies;
- Recalculating the provision for expected credit loss on the
outstanding trade receivables in accordance with the
requirements of AASB 9;
- Confirming the existence of accounts receivable balances
recorded at year-end;
Tested a sample of debtors to ascertain whether the recorded
amounts are recognised net of any material deferred financing
amounts;
Assessing the reasonableness of the basis, estimates and judgements
applied by management in assessing expected credit losses on trade
receivables;
Assessing the accuracy of the classification of trade receivables
between current and non-current assets in notes 9 and 12 of the
financial report;
Assessed the adequacy of the disclosure in notes 2, 9 and 12 of the
financial report.
74
Key audit matter
How our audit addressed the key audit matter
Capitalisation of internally
generated software intangibles
Our audit procedures in respect of this area included by were not limited
to the following:
We obtained an understanding of the Group’s current software
development programme processes to ensure capitalised costs met
the requirements for recognition as intangible assets in accordance
with AASB 138;
We obtained an understanding of the records and data that
management applies to document development time incurred by core
development staff;
Instructing and reviewing the audit work papers of the component
auditor in Columbia, which included the following specific procedures:
-
For a sample of capitalised development costs, reviewed the
underlying data and supporting documentation to ensure the
activities recorded were consistent with the recognition
requirements of AASB 138.
We have obtained representations from Management, including the
Head of Development that the allocation of costs to individual
projects are determined in accordance with AASB 138.
Refer to note 15 in the financial
report.
The capitalisation of internally
generated software intangibles is
considered a key audit matter due
to the significant judgement in the
assessment of development
project costs in accordance with
the requirements of AASB 138
‘Intangible Assets’ (AASB 138).
The Group has a number of active
internal software development
programs which are at various
stages of development. Given the
unique nature of the software in
development there is significant
management judgement in the
application of the recognition
criteria under AASB 138.
Other information
The directors are responsible for the other information. The other information comprises the information in
IMEXHS Limited’s annual report for the year ended 31 December 2020, but does not include the financial
report and the auditor’s report thereon. Our opinion on the financial report does not cover the other
information and we do not express any form of assurance conclusion thereon. In connection with our audit
of the financial report, our responsibility is to read the other information and, in doing so, consider whether
the other information is materially inconsistent with the financial report or our knowledge obtained in the
audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of the other
information we are required to report that fact. We have nothing to report in this regard.
Directors’ responsibility 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 Group’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 Group or to cease operations, or have
no realistic alternative but to do so.
75
Auditor’s responsibility 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 Australian
Auditing and Assurance Standards Board website at:
www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our auditor’s
report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 26 to 34 of the directors’ Report for the year
ended 31 December 2020.
In our opinion, the Remuneration Report of IMEXHS Limited for the year ended 31 December 2020, 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.
Nexia Sydney Audit Pty Ltd
Andrew Hoffmann
Director
Dated: 29 March 2021
Sydney
76
IMEXHS Limited
Shareholder information
31 December 2020
The shareholder information set out below was applicable as at 28 February 2021.
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
Ordinary shares
Number
of holders
% of total
shares
issued
Options over ordinary
shares
Number
of holders
% of total
shares
issued
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
343
483
180
246
34
0.52
4.40
4.68
23.86
66.54
1,286
100.00
Holding less than a marketable parcel
96
-
Equity security holders
Twenty largest quoted equity security holders
The names of the twenty largest security holders of quoted equity securities are listed below:
-
-
3
22
13
38
-
-
-
0.35
18.61
81.04
100.00
-
National Nominees Limited
Digital Imaging Solutions Sas
Jaava Asesores Integrales Sas
Volegna Holdings Pty Ltd (The Csa A/C)
Irukandji Investments Pty Ltd (Longreach Family A/C)
Hsbc Custody Nominees (Australia) Limited
Rio Negro Pty Ltd (The Medallo A/C)
Dr & Lc Flynn Nominees Pty Limited (Flynn Super Fund A/C)
Dixson Trust Pty Limited
Mr James Woulfe & Mrs Catherine Maria Woulfe (Debhulbh Family A/C)
Tisia Nominees Pty Ltd (Henderson Family A/C)
Citicorp Nominees Pty Limited
Ilewise Pty Ltd (Lingard Family A/C)
Optim8 Pty Ltd (The Gic Super Fund A/C)
Virgina Marin Munoz
Carmen Cecilia Arango Bonnet
Mr Barry Assaf
John Alexander Sanz Ramirez
Bannaby Investments Pty Limited (Bannaby Super Fund A/C)
Dirdot Pty Limited (Griffith Super Fund A/C)
Unquoted equity securities
Ordinary shares
Number held
% of total
shares
issued
3,761,248
3,150,503
2,048,758
1,240,190
1,187,836
975,326
888,836
571,649
448,737
425,495
345,500
343,331
333,333
312,490
290,857
290,857
282,011
253,625
250,000
205,970
17,606,552
12.66
10.61
6.90
4.18
4.00
3.28
2.99
1.92
1.51
1.43
1.16
1.16
1.12
1.05
0.98
0.98
0.95
0.85
0.84
0.69
59.26
Number
on issue
Number
of holders
Options over ordinary shares issued
6,190,003
ANNUAL REPORT 2020
38
77
IMEXHS Limited
Shareholder information
31 December 2020
Substantial holders
Substantial holders in the Company are set out below:
National Nominees Limited
Digital Imaging Solutions Sas
Jaava Asesores Integrales Sas
Voting rights
The voting rights attached to ordinary shares are set out below:
Ordinary shares
Number held
% of total
shares
issued
3,761,248
3,150,503
2,048,758
12.66
10.61
6.90
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
There are no other classes of equity securities.
ANNUAL REPORT 2020
78
IMEXHS Limited
Corporate directory
31 December 2020
Directors
Mr Douglas Flynn - Non-Executive Chairman
Dr German Arango - Chief Executive Officer
Dr Douglas Lingard - Non-Executive Director
Mr Carlos Palacio - Non-Executive Director
Mr Damian Banks - Non-Executive Director
Company secretary
Ms Reena Minhas
Notice of annual general meeting
The details of the annual general meeting of IMEXHS Limited are:
To be held at 10:00AM on Thursday, 13 May 2021
The location is yet to be determined
Registered office
Principal place of business
Share register
Auditor
Bankers
122 O’Riordan Street
Mascot NSW 2020
122 O’Riordan Street
Mascot NSW 2020
Automic Pty Ltd
Level 5, 126 Phillip Street
Sydney NSW 2000
Tel: 1300 288 664
Tel: +61 2 9698 5414 (international)
Email: hello@automic.com.au
Nexia Sydney Audit Pty Ltd
Level 16, 1 Market Street
Sydney NSW 2000
National Australia Bank
Level 12, 100 St Georges Tce
Perth WA 6000
Stock exchange listing
IMEXHS Limited shares are listed on the Australian Securities Exchange (ASX code:
IME)
Corporate Governance Statement
The directors and management are committed to conducting the business of IMEXHS
Limited in an ethical manner and in accordance with the highest standards of
corporate governance. IMEXHS Limited has adopted and has complied with the ASX
Corporate Governance Principles and Recommendations (Fourth Edition)
(‘Recommendations’) to the extent appropriate to the size and nature of its
operations.
The Corporate Governance Statement, which sets out the corporate governance
practices that were in operation during the financial year and identifies and explains
any Recommendations that have not been followed was approved by the Board of
Directors at the same time as the Annual Report and can be found at
www.imexhs.com
ANNUAL REPORT 2020
79
A.
Annual Report
IMEXHS™ is the place where innovation and technology
meet medical experience
IMEXHS.com
2020