IXUP Limited
ABN 85 612 182 368
Annual Report - 30 June 2024
1
IXUP Limited
Corporate directory
30 June 2024
Directors
Freya Smith (Non-Executive Director)
Julian Babarczy (Non-Executive Chairman)
Ian Penrose (Non-Executive Director)
Company secretary
David Franks
Registered office and Principal
Level 11
Place of Business
201 Miller Street
North Sydney, NSW, 2060
Telephone +61 2 8206 8888
Email: contact@ixup.com
Share register
Automic Group Limited
Level 5, 126 Philip Street
Sydney NSW 2000
Telephone +61 2 8072 1400
Email: info@automic.com.au
Auditor
Hall Chadwick WA Audit Pty Ltd
283 Rokeby Road
Subiaco WA 6008
Solicitors
Thomson Geer
Bankers
St George Bank Limited
Stock exchange listing
IXUP Limited shares are listed on the Australian Securities Exchange. ASX code: IXU
Website
www.ixup.com
Place of Incorporation
Victoria, Australia
2
IXUP Limited
Directors report
30 June 2024
The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as
the 'consolidated entity') consisting of IXUP Limited (referred to hereafter as the 'Company', 'parent entity' or 'IXUP') and the
entities it controlled at the end of, or during, the year ended 30 June 2024.
Directors
The following persons were directors of IXUP Limited during the whole of the financial year and up to the date of this report,
unless otherwise stated:
Freya Smith
Non-Executive Director
Julian Babarczy
Non-Executive Chairman
Ian Penrose
Non-Executive Director
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Result of operations
The loss for the consolidated entity after providing for income tax amounted to $10,278,358 (30 June 2023: $26,561,261).
Review of operations
During the year IXUP expanded the features offered across the IXUP privacy preserving analytics platform through the
release of further platform updates which has strengthened the commercial offering of its technology. This truly unique
capability is designed to remove the risk of data loss and misuse, in an environment that is seeing unprecedented remote
business activity and increased instances of cyber-attacks. The Company believes that future demand for the IXUP platform
will increase due to the exponential increase in data acquisition occurring globally, and a desire to monetise new data assets
without risk.
Highlights of the year include:
●
Operational changes reflect IXUP’s strategic focus on emerging compliance and integrity opportunities
●
Successful launch of BetStop – The National Self Exclusion Register (the Register)
●
Commenced Pilot with Tier 1 global Technology organisation to manage sensitive climate change modelling data
●
DataPOWA division won several incremental contracts
●
Operational turnaround confirmed by 82% increase in revenue receipts and 23% reduction in operational expense
outflows in the December 23 quarter
●
Entitlement issue and debt reduction
●
Partnership with IC360 (Formerly US Integrity/Odds on compliance) to accelerate growth in global regulatory and
compliance markets
●
Appoints Alastair Watson as CEO
●
Secure cloud opportunity fast tracked with early move to commercial negotiations
Capital Raise
On 2 August 2023, the Company announced that it was looking to raise $4.1m via a $2.0m placement and $2.1m non-
renounceable entitlement on a one (1) for thirty (30) basis. The $2.0 million placement was completed in full while the $2.1
million non-renounceable entitlement offer, which was supported by Directors and Management, received $766,958.64 of
acceptances from shareholders.
The funds raised are being used to fund ongoing development across the company’s four core divisions:
•
Core Technology
•
RegTech – including PlayPause and BetStop – the National Self Exclusion Register
•
Sports & Marketing – including DataPOWA and new IXUP Collaboration product development and sales
•
IXUP Data Governance product
Successful launch of BetStop – The National Self Exclusion Register
On 28 August 2023, the Company announced that the Register was now fully operational.
The Register is fully operated and maintained by IXUP under contract with The Australian Communication and Media
Authority, as the agency responsible for the register’s regulation.
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IXUP Limited
Directors report
30 June 2024
Pilot Commenced using Core Technology
On 30 October 2023, the Company announced that it had commenced the process for a paid pilot with a Tier 1 global cloud
computing organisation related to managing and modelling sensitive environmental data in a secure cloud environment
powered by IXUP’s core technology.
Potential exists for a broader global roll-out of IXUP’s secure cloud data collaboration platform as well as IXUP’s 5-Safes
governance framework within the global cloud computing environment.
DataPOWA division continues to improve
On 30 October 2023, the Company announced that it’s DataPOWA division had continued to win several incremental contracts
ahead of its new data collaboration product release (known as Venn).
The new secure data collaboration product is also being demonstrated to a range of other IXUP customers with sales
discussions underway.
Confirmation of Operational Turnaround
On 31 January 2024, the company announced that the business performance had improved with the 82% increase in
revenue receipts quarter on quarter and a 23% reduction in operation expenses outflows quarter on quarter, which resulted in
materially reduced cash burn.
Entitlement issue and debt reduction
On 11 March 2024, the Company undertook a non-renounceable entitlement offer on a one (1) for four (4) basis to raise up to
approximately A$4 million, partially underwritten for $2.9 million by Cygnet Capital.
Convertible Noteholders also agree to settle A$2.75 million of convertible notes through the issue of approximately 183.33
million shares.
Funds raised remove debt and fund the Company to progress on identified organic growth initiatives.
.
Partnership with IC360 (Formerly US Integrity/Odds on Compliance)
On 3 April 2024, the Company announced it had entered a commercial partnership agreement with Las Vegas based US
IC360 to jointly target specific regulated gaming technology opportunities, initially focused on North America and Australia
and eventually all major global gaming jurisdictions.
Appointment of Chief Executive Officer
On 2 May 2024, the company announced the appointment of Alastair (Al) Watson as Chief Executive Officer, effective from 1
June 2024. Al has more than 20 years of experience working in scaling SaaS based businesses across a range of business
life cycles, from start up to established/mature operations. Al holds a Master of Laws from the University of California
Berkeley, a Bachelor of Laws (Honors) from Macquarie University and a Bachelor of Arts from the University of New England.
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IXUP Limited
Directors report
30 June 2024
Financial position
The Company reported sales revenue of $6,630,857 (30 June 2023: $1,256,161) for the financial year ended 30 June 2024.
IXUP is in the early stages of commercialisation with version 4 of the SaaS and PaaS platform released in April 2020. The
Company continues to invest in its technology platform and at 30 June 2024 had cash and term deposits of $1,147,951 (30
June 2023: $1,642,869).
During the year the Company received an Australian Tax Office R&D tax rebate and other government rebates of $1,582,688
(30 June 2023: $1,104,398).
Significant changes in the state of affairs
There were no significant changes in the state of affairs of the consolidated entity during the financial year.
Matters subsequent to the end of the financial year
On the 2 of August 2024, the Company announced it had been awarded a A$10 million online gambling self
exclusion contract in Ontario, Canada.
IXUP has entered the North American market having secured in conjunction with its North American partner IC360, a
strategically important contract to provide the self-exclusion register for the Province of Ontario, Canada’s largest gambling
market. The contract has a total estimated contract value of over A$10 million over an initial 5-year contract term with a
further three, one year contract extensions.
On the 26th of August, the Company announced confirmed the initial deployment of its core technology. IXUP expected to
deploy its Secure Data Engine and 5-Safes government framework, delivered via Microsoft Azure, to power the Western
Australian Government funded Shared Environmental Analytics Facility (SEAF). The company has signed a multi-year
contract with The Western Australian Biodiversity Science Institute (WABSI) and the project partners include Microsoft, Rio
Tinto, BHP Billiton and various Western Australian Government organisations.
On the 26th of September, the Company announced it had firm commitments for $1.85m via a share placement, which is
expected to settle on the 3rd October 2024. Participants will receive one free attaching unlisted option for every 2 shares
subscribed and the proceeds will be used to enhance IXUP’s sales pipeline and advance sales conversion activities as well
as facilitate ongoing business transformation.
No other matters or circumstances have arisen since 30 June 2024 that have significantly affected, or may significantly affect
the consolidated Company’s operations, the results of those operations, or the consolidated entity's state of affairs in future
financial years.
Likely developments and expected results of operations
Since the listing, the Company has been focused on building out its team, developing its product, defining its brand and
expanding its capability to commercialise the IXUP platform.
The Company continues to progress discussions with potential users of the IXUP platform and to progress discussions with
potential partners as well as explore additional opportunities in the market.
The Company continues to monitor developments related to COVID-19, with past actions reflecting the focus of the Board
and Management on preserving cash and long-term shareholder value while maintaining focus on service of existing and
prospective customer and conversion of IXUP's sales pipeline.
Environmental, Social and Governance
Our environmental commitment
IXUP is committed to being a responsible and sustainable business. We believe it makes good business sense to have
environmental, social and governance (ESG) policies and programs were doing the right thing by our people, our partners,
our environment and the communities in which we operate is part of our ethos.
Although the consolidated entity is not subject to any significant environmental regulation under Australian Commonwealth
State or Territory law, the Company is seeking to undertake in the future, an analysis of Company objectives that can reduce
its environmental footprint.
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IXUP Limited
Directors report
30 June 2024
Risk Management
Identifying and mitigating business risks that may affect the Company’s strategy and financial performance is an essential
part of the governance framework. This section outlines some of the key risks identified by the Company. They are not listing
in importance or likelihood to materialize
RISK AREA
DESCRIPTION
TECHNOLOGY AND
SOFTWARE
The Company’s business is based on software, source code, technology and computer
programs which comprise it’s data privacy platforms. There is a risk that this technology
and/or software may be superseded or displaced in the market by new technology offerings
or software which customers perceive have advantages over the Company’s offerings.
Furthermore the Company’s systems can be affected by numerous factors including by not
limited to data losses, computer system faults, failures of or suspension from key data
feeds, data network failures, and catastrophic events such as a natural disaster, computer
viruses of power failure.
INTELLECTUAL
PROPERTY AND
OBLIGATIONS
There is a risk that failure or inability to protect intellectual property rights may have a
significant adverse effect on operations, financial performance and competitive advantage.
Further, there is a risk that the operations, products, services or platforms may infringe the
intellectual property rights of third parties. If any claim of litigation is bought against the
Company which alleges an infringement on another party’s intellectual property rights, this
could result in the Company being subject to significant liability for damages or losing the
right to use the intellectual property.
REGULATION
Regulation relating to the privacy of personal data continues to evolve in various
jurisdictions. Accordingly, there is an exposure to a range of risks relating to compliance
with, changes to, or uncertainty in, the relevant legal and regulatory regimes in those
jurisdictions. Changes to laws and regulations or failure to comply may have a material
adverse effect on the Company’s business, financial position and prospects.
SECURITY SOFTWARE
TECHNOLOGY
BREACHES AND
IMPROPER ACCESS
TO PERSONAL DATA
By their nature, information technology systems are susceptible to cyber-attacks with third
parties seeking unauthorized access to data, networks, systems and databases. Further
third party suppliers may receive and store information from the company or its customers
and although this information is limited and subject to confidentiality obligations, if third party
suppliers fail to adopt or adhere to robust security practices, any such information may be
improperly accessed, used or disclosed.
CUSTOMER
ENVIRONMENT
The Company provides its customers with technology and data solutions that support data
protection and ability to securely share data between different customers. Changes in
relation to customers perception of the ability to protect data and cost associated with that
may have a direct financial impact on the Company customers and therefore an indirect on
the Company’s financial performance.
Reconciliation of the Annual Report to the 4E
The following table provides a reconciliation of the Annual Report to the 4E:
Loss from ordinary activities after tax attributable to members per 4E
($10,278,358)
Income Tax (Expense)/Benefit
-
Employee Entitlements
-
Loss from ordinary activities after tax attributable to members per the annual report (pg. 20)
($10,278,358)
Directors believe this information is useful to provide investors with transparency on the underlying performance of the business.
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IXUP Limited
Directors report
30 June 2024
Corporate Governance
IXUP's Board of Directors is responsible for the corporate governance of IXUP Limited. The Board guides and monitors the
business affairs of the Group on behalf of stakeholders and its activities are governed by the Constitution.
Our Corporate Governance Statement is founded on the ASX Corporate Governance Council's principles and
recommendations. The statement is periodically reviewed and, if necessary, revised to reflect the changing nature of the
industry.
The responsibilities of the Board of Directors and those functions reserved to the Board, together with the responsibilities of
the Chief Executive Officer are set out in our Board Charter. To assist with governance IXUP has established policies.
For copies of policies and charters notes in this section, please visit the IXUP website and navigate to Investors > Corporate
governance.
Information on directors
Name:
Freya Smith
Title:
Non-Executive Director
Experience and expertise:
Ms. Freya Smith is currently the General Counsel and Company Secretary for Cuscal
Limited, a leading Australian payments company. Before joining Cuscal, Freya was the
Group General Counsel and Company Secretary for Claim Central Consolidated, a
global insurtech business and prior to that she was Chief Legal Officer and Company
Secretary for ASX listed global payments company of OFX Group Limited
Ms. Smith holds a Bachelor of Commerce and a Bachelor of Laws (Hons), a Master of
Laws (High Distinction) and a Graduate Diploma of Applied Corporate Governance
from the Governance Institute of Australia. She is also a member of the Association of
Corporate Counsel; Fellow of the Governance Institute of Australia; and a member of
the Australian Institute of Company Directors.
Other current directorships:
Nil
Former directorships (last 3 years): Nil
Special responsibilities:
Chair of the Audit and Risk Committee and Member of the Nomination and
Remuneration Committee
Interests in shares:
Nil
Interests in options:
11,000,000
Interests in rights:
Nil
Name:
Julian Babarczy
Title:
Non-Executive Chairman
Experience and expertise:
Mr. Babarczy is a finance industry professional with a career spanning 23 years, almost
two-thirds of which was as a key member of Australia’s largest actively managed hedge
funds, Regal Funds Management. Julian was a key member of the investment and
leadership team at Regal and was instrumental in growing funds under management.
Julian undertook a range of roles during his tenure at Regal, including Analyst &
Portfolio Manager and Head of Australian Equities and was responsible for investments
across a range of sectors, in both listed and unlisted companies. In the latter stages of
his career at Regal, Julian transitioned his investment style to include board
memberships of listed and unlisted companies, and a more active and hands-on
investment style.
Mr. Babarczy holds a Bachelor of Business, a Chartered Financial Analyst from CFA
Institute and a Graduate Diploma of Mineral Exploration Geosciences from Curtin
University.
Other current directorships:
Perpetual Resources Limited (ASX: PEC)
Former directorships (last 3 years): nil
Special responsibilities:
Member of the Audit and Risk Committee and Member of the Nomination and
Remuneration Committee
Interests in shares:
28,209,758
Interests in options:
35,363,997
Interests in rights:
4,000,000
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IXUP Limited
Directors report
30 June 2024
Name:
Ian Penrose
Title:
Non-Executive Director
Experience and expertise:
Mr. Penrose is a highly experienced board member and global executive who has
achieved a successful career focusing on international gaming, technology, leisure and
sporting industries. In these roles, Ian has consistently fostered innovation and added
to shareholder value, while never losing sight of the importance of maintaining high
standards of corporate governance
Mr. Penrose has a Bachelor of Science (Management Sciences) from the University of
Manchester. He has been licensed by regulators in several countries and is also a
chartered Accountant.
Other current directorships:
Senior Independent Director of Playtech plc
Former directorships (last 3 years): Nil
Special responsibilities:
Chair of the Nomination and Remuneration Committee
Interests in shares:
11,315,042
Interests in options:
40,140,308
Interests in rights:
11,000,000
'Other current directorships' quoted above are current directorships for listed entities only and exclude directorships of all
other types of entities.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and exclude
directorships of all other types of entities, unless otherwise stated.
Company secretary
David Franks from the Automic Group acting as Company Secretary.
David Franks is a Principal of the Automic Group. He is a Chartered Accountant, Fellow of the Financial Services Institute of
Australia, Fellow of the Governance Institute of Australia, Justice of the Peace, Registered Tax Agent and holds a Bachelor
of Economics (Finance and Accounting) from Macquarie University. With over 30 years’ experience in finance, governance
and accounting, Mr. Franks has been CFO, Company Secretary and/or Director for numerous ASX listed and unlisted public
and private companies, in a range of industries covering energy retailing, transport, financial services, mineral exploration,
technology, automotive, software development and healthcare. Mr. Franks is currently the Company Secretary for the
following ASX Listed entities: Applyflow Limited, COG Financial Services Limited, Cogstate Limited, Exopharm Limited, IRIS
Metals Limited, JCurve Solutions Limited, Noxopharm Limited, Nyrada Inc, White Energy Company Limited and ZIP Co
Limited. He was also a Non-Executive Director of JCurve Solutions Limited from 2014 to 2021.
Meetings of directors
The number of meetings of the Company's Board of Directors ('the Board') and of each Board committee held during the
year ended 30 June 2024, and the number of meetings attended by each director were:
Full Board
Audit and Risk
Committee
Nomination and
Remuneration
Committee
Attended
Held
Attended
Held
Attended
Held
Freya Smith
6
6
3
3
2
2
Julian Babarczy
6
6
3
3
2
2
Ian Penrose
6
6
3
3
2
2
Held: represents the number of meetings held during the time the director held office or was a member of the relevant
committee.
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IXUP Limited
Directors report
30 June 2024
Remuneration report (audited)
The remuneration report details the Key Management Personnel (KMP) remuneration arrangements for the consolidated
entity, in accordance with the requirements of the Corporations Act 2001 and its Regulations.
KMP are those persons having authority and responsibility for planning, directing and controlling the activities of the entity,
directly or indirectly, including all directors. In this report “Executive KMP” refers to members of the Executive team that are
KMP and includes Mr. Alastair Watson for the period in which he was Chief Executive Officer for the reporting period, and
Mr. Matthew Johnson as Chief Financial Officer.
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 information
●
Additional disclosures relating to KMP
Principles used to determine the nature and amount of remuneration
The objective of the consolidated entity's Executive KMP reward framework is to ensure reward for performance is
competitive and appropriate for the results delivered. The framework aligns Executive KMP 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 ensures that Executive KMP reward satisfies the following key criteria for good
reward governance practices:
●
Competitiveness and reasonableness
●
Acceptability to shareholders
●
Performance linkage / alignment of executive compensation
●
Transparency
The Board is responsible for determining and reviewing remuneration arrangements for its KMP. The performance of the
consolidated entity 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 reward framework is designed to align Executive KMP reward to shareholders' interests. The Board 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 share price growth 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.
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 Director's remuneration
Fees and payments to Non-Executive Directors reflect the demands and responsibilities of their role. Non-Executive
Directors' fees and payments are reviewed annually by the Board. The Board 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. As outlined in the prospectus dated 3 October 2017 released to the ASX on 14 November 2017, the aggregate
remuneration of Non-Executive Directors has been set at an amount not to exceed $500,000 per annum.
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IXUP Limited
Directors report
30 June 2024
Executive KMP remuneration
The consolidated entity aims to reward Executive KMP based on their position and responsibility, with a level and mix of
remuneration which has both fixed and variable components and includes:
●
Base pay and non-monetary benefits;
●
Short-term performance incentives;
●
Share-based payments; and
●
Other remuneration such as superannuation and long service leave.
The combination of these comprises the Executive KMP's total remuneration.
Fixed remuneration, comprising of base salary, superannuation and non-monetary benefits, is reviewed annually by the
Board based on individual and business performance and benchmarking.
Executive KMP may receive their fixed remuneration in the form of cash or other fringe benefits where it does not create any
additional costs to the company and provides additional value to the Executive KMP.
The short-term incentive ('STI') plan is designed to align the targets of the business with the performance hurdles of Executive
KMP. STI is an annual "at risk" opportunity awarded to Executive KMP based on specific annual targets and key performance
indicators. Performance conditions are clearly defined and measurable and designed to support the financial and strategic
direction of the business and in turn translate to shareholder return. STI is currently awarded to Executive KMP in 100%
cash.
The long-term benefits ('LTB') plan includes long service leave and share-based payments. Options and Performance Rights
are awarded to Executive KMP over a period of three years based on long-term incentive measures. These include increase
in shareholder value relative to the entire market and the increase compared to the consolidated entity's direct competitors.
Details of remuneration
Amounts of remuneration
Details of the remuneration of KMP of the consolidated entity are set out in the following tables.
The KMP of the consolidated entity consisted of the following directors of IXUP Limited:
●
Freya Smith - Non-Executive Director
●
Julian Babarczy - Non-Executive Chairman
●
Ian Penrose - Non-Executive Director
●
Alastair Watson - CEO
●
Matthew Johnson – CFO
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IXUP Limited
Directors report
30 June 2024
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
Cash salary
and fees
Cash
bonus
Non-
monetary
Super-
annuation
Long
service
leave
Equity-
settled
Total
2024
$
$
$
$
$
$
$
Alastair Watson
33,333
-
- 3,667
- -
37,000
Freya Smith
56,757
-
-
6,243
- 50,000
113,000
Julian Babarczy*
191,667
-
-
-
- 250,000
441,667
Ian Penrose
59,838
-
-
-
-
250,000
309,838
Matthew Johnson
300,000
-
-
33,000
- -
333,000
641,595
-
-
42,910
- 550,000 1,234,505
* Paid through Jigsaw Consulting Pty Ltd a company associated to Julian Babarczy.
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
2023
$
$
$
$
$
$
$
Dean Joscelyne*
90,023
-
-
-
-
-
90,023
Freya Smith
54,795
-
-
5,753
- 85,200
145,748
Julian Babarczy**
111,667
-
-
-
- 142,000
253,667
Ian Penrose
59,838
-
-
-
-
213,000
272,838
Marcus Gracey
247,780
-
-
17,908
-
-
265,689
Matthew Johnson
280,000
-
-
29,400
- 152,000
461,400
844,103
-
-
53,062
- 592,200 1,489,364
* Paid through Destria Pty Ltd a company associated to Dean Joscelyne. From 1 March 2021 Dean Joscelyne transitioned
to a Non-Executive role and he remains a key consultant to the Company.
** Paid through Jigsaw Consulting Pty Ltd a company associated to Julian Babarczy.
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IXUP Limited
Directors report
30 June 2024
The proportion of remuneration paid linked to performance and the fixed proportion are as follows:
Fixed remuneration
At risk - STI
At risk - LTI
Name
2024
2023
2024
2023
2024
2023
Alastair Watson
100%
-
- -
-
-
Dean Joscelyne
-
100%
-
-
-
-
Freya Smith
56%
42%
-
-
44%
58%
Julian Babarczy
43%
44%
-
-
57%
56%
Marcus Gracey
-
100%
-
-
-
-
Ian Penrose
20%
22%
- -
80%
78%
Matthew Johnson
100%
67%
-
-
33%
33%
Service agreements
Remuneration and other terms of employment for Executive KMP are formalised in service agreements. Details of these
agreements are as follows:
Name:
Alastair Watson
Title:
Chief Executive Officer
Agreement commenced:
The principal terms of the Executive Director agreement for Mr. Watson were as follows:
Term of agreement:
(i) A base salary of $400,000 per annum (exclusive of statutory superannuation).
(ii) Entitlement to participate in employee and executive incentive plans and the
Company to provide additional bonus and incentives. Mr. Watson has been granted
with 50,000,000 Performance Rights.
(iii) The agreement has no fixed term and may be terminated with a 3 month notice by
either party.
Name:
Matthew Johnson
Title:
Chief Financial Officer
Agreement commenced:
06 December 2021
Term of agreement:
The principal terms of the Executive agreement for Mr. Johnson were as follows:
(i) A base salary of $300,000 per annum (exclusive of statutory superannuation).
(ii) Entitlement to participate in employee and executive incentive plans and the
Company to provide additional bonus and incentives. Mr. Johnson has been granted
with 4,000,000 Performance Rights.
(iii) The agreement has no fixed term and may be terminated with a 3 month notice by
either party.
The Constitution of the Company provides that the remuneration of Non-Executive Directors will not be more than the
aggregate fixed sum determined by a general meeting of Shareholders or, until so, by the Directors. The aggregate
remuneration for Non-Executive Directors as outlined in the Prospectus dated 3 October 2017 has been set at an amount
not to exceed $500,000 per annum. The Board has resolved that the Non-Executive Directors’ base fee will be $65,000 per
annum for Non-Executive Directors (inclusive of statutory superannuation) and an additional $10,000 per annum (inclusive
of statutory superannuation) for each Board committee that they participate in commencing on Official Quotation. Mr.
Babarczy, Mr. Penrose and Ms. Smith are Non-Executive Directors as at the date of this report.
Share-based compensation
Issue of shares
There were no shares issued to directors and Executive KMP as part of compensation during the year ended 30 June 2024
or during the year ended 30 June 2023.
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IXUP Limited
Directors report
30 June 2024
Share-based compensation (Cont.)
Options over equity instruments
The terms and conditions of each grant of options and performance rights over ordinary shares affecting remuneration of
directors and Executive KMP in this financial year or future reporting years are as follows:
FINAN
CIAL
YEAR
OPENING NO.
OPTIONS
AWARDED
DURING THE
YEAR NO.
NO. OF
LAPSED
DURING
YEAR
CLOSING
NO.
AWARD
DATE
FAIR VALUE
PER OPTION
AT DATE ($)
VESTING
DATE
EXERCISE
PRICE
EXPIRY
DATE
VALUE OF
OPTIONS
GRANTED
DURING THE
YEAR
VALUE OF
OPTIONS
EXERCISED
DURING THE
YEAR
JULIAN
BABARCZY
2023
10,000,000
-
-
10,000,000 16/12/22
$0.014 16/12/22
$0.06 16/12/24
-
-
2024
-
25,000,000
-
25,000,000 7/6/24
$0.010
7/6/24
$0.03
31/5/27
$250,000
-
IAN
PENROSE
2023
15,000,000
-
-
15,000,000 16/12/22
$0.014 16/12/22
$0.06 16/12/24
-
-
2024
-
25,000,000
-
25,000,000 7/6/24
$0.010
7/6/24
$0.03
31/5/27
$250.000
FREYA
SMITH
2023
6,000,000
-
-
6,000,000 16/12/22
$0.014 16/12/22
$0.06 16/12/24
-
-
2024
-
5,000,000
-
5,000,000 7/6/24
$0.010
7/6/24
$0.03
31/5/27
$50,000
-
Performance rights
Performance rights over ordinary shares issued to directors and Executive KMP as part of compensation that were
issued during the year ended 30 June 2024 are as follows:
FINANCIAL
YEAR
TRANCHE
PERFORMANCE
RIGHTS (PR)
AWARDED
DURING THE
YEAR NO.
FAIR VALUE
PER PR AT
DATE ($)
EXERCISE
PRICE
EXPIRY
DATE
NO. OF VESTED
DURING YEAR
NO. OF
LAPSED
DURING
YEAR
VALUE OF PR
GRANTED
DURING THE
YEAR
VALUE OF PR
EXERCISED
DURING THE
YEAR
JULIAN
BABARCZY
2021*
Tranche 2
2,000,000
$0.093
-
3/2/26
-
-
-
-
2021*
Tranche 3
2,000,000
$0.091
3/2/26
MATTHEW
JOHNSON
2023**
-
4,000,000
$0.125
-
3/2/26
-
-
-
-
IAN
PENROSE
2022***
Tranche 1
2,500,000
$0.210
-
31/3/25
-
-
-
-
2022***
Tranche 2
2,500,000
$.0210
-
31/3/25
-
-
2022***
Tranche 3
6,000,000
$0.210
-
31/3/25
-
-
-
-
*Julian Babarczy was issued 6,000,000 performance rights on 3 February 2021 (2,000,000 Tranche 1 Performance Rights vested in FY22; 2,000,000; Tranche 2 Performance
Rights which vest on the last to occur of: (i) the date the customer goes live on commercial use of the Company’s core technology pursuant to a commercial contract; (ii) the
20 day VWAP of the Company's shares being equal to or greater than $0.10; and 2,000,000 Tranche 3 Performance Rights which vest on the last to occur of: (i) IXUP achieving
revenue in any financial year equal to, or greater than, $5 million; and (ii) the 20 day VWAP of the Company's shares being equal to or greater than $0.125.)
**Matthew Johnson was issued 4,000,000 performance rights on the 3rd of February 2023. All rights will vest in the measurement period a) Signed commercial revenue
generating contracts; b) Revenue targets c) Successful US Pilot and d) Individual KPI’s
***Ian Penrose was issued 11,000,000 performance rights on 7 October 2021. (5,000,000 Class A Rights where a) 2.5m Rights vest upon introduction and completion of 1 or
more transactions that add an aggregate of at least A$2.5m in revenue to the Group in any Measurement Period; b) 2.5m Rights vest upon introduction and completion of 1
or more transactions that add an aggregate of at least A$6.5m in revenue to the Group in any Measurement Period; and c) provided that, as soon as the A$6.5m revenue
threshold above is reached or exceeded in a particular Measurement Period as a result of one or more transactions introduced, all 5m Rights vest) (6,000,000 Class B
Performance Rights, upon the last to occur of each of a) the VWAP of IXUP shares trading on ASX during any rolling period of 20 continuous trading days meets or exceeds a
level which is 33% higher than the closing price for IXUP shares as at the grant date; b) the Group achieves revenue of at least A$5m in any Measurement Period; and c) the
recipient has been engaged by the Group for a continuous period of 3 yrs.)
13
IXUP Limited
Directors report
30 June 2024
Additional information
The earnings of the consolidated entity for the five years to 30 June 2024 are summarised below:
2024
2023
2022
2021
2020
$
$
$
$
$
Revenue
6,630,857
1,256,161
977,172
16,750
88,500
Profit/(loss) after income tax
(10,278,358)
(26,561,261)
(13,662,608)
(5,424,785)
(3,774,992)
The factors that are considered to affect total shareholders return ('TSR') are summarised below:
2024
2023
2022
2021
2020
Share price at financial year end ($)
0.04
0.05
0.05
0.19
0.01
Basic earnings per share (cents per share)
(0.87)
(2.68)
(1.59)
(0.88)
(1.93)
Additional disclosures relating to KMP
Shareholding
The number of shares in the Company held during the financial year by each director and Executive KMP of the consolidated
entity, including their personally related parties, is set out below:
Balance at
the start of
the year
Received
as part of
remuneration
Additions
Disposals/
other
Balance at
the end of
the year
Ordinary shares
Julian Babarczy*
21,839,814
-
6,369,944
-
28,209,758
Ian Penrose**
8,438,404
-
2,876,636
-
11,315,040
Matthew Johnson
332,143
-
83,035
-
415,178
30,610,361
-
9,329,615
-
39,939,976
*
Julian Babarczy holds his interests in shares indirectly through Vaucluse Investment Holdings of which he is a
beneficiary.
** Ian Penrose holds 1,288,617 shares indirectly through Dunaswood Limited of which he and his wife are controlling
parties
14
IXUP Limited
Directors report
30 June 2024
Option holding
The number of options over ordinary shares in the Company held during the financial year by each director and Executive
KMP of the consolidated entity, including their personally related parties, is set out below:
Balance at
Expired/
Balance at
the start of
forfeited/
the end of
the year
Granted
Exercised
other
the year
Options over ordinary shares
Freya Smith
6,000,000
5,000,000 - -
11,000,000
Julian Babarczy*
10,000,000
25,363,997 - -
35,363,997
Ian Penrose
15,000,000
25,140,308 - -
40,140,308
31,000,000
55,504,305 - -
86,504,305
*
Julian Babarczy holds his interests in shares indirectly through Vaucluse Investment Holdings and Jigsaw
Investments Holdings both of which he is a beneficiary.
Performance rights
The number of performance rights over ordinary shares in the company held during the financial year by each Director and
Executive KMP of the consolidated entity, including their personally related parties, is set out below:
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
Performance rights
Freya Smith
-
-
- -
-
Matthew Johnson
4,000,000
- - -
4,000,000
Julian Babarczy*
4,000,000
-
-
-
4,000,000
Ian Penrose
11,000,000 -
-
- 11,000,000
19,000,000
-
-
-
19,000,000
*
Julian Babarczy holds his interests in shares indirectly through Vaucluse Investment Holdings of which he is a
beneficiary.
This concludes the remuneration report, which has been audited.
15
IXUP Limited
Directors report
30 June 2024
Shares under option
Unissued ordinary shares of IXUP under option at the date of this report are as follows:
Grant date
Expiry date
Exercise
price
Number
under option
29 January 2021
03 February 2025
$0.10
40,000,000
16 December 2022
16 December 2024
$0.06
156,000,000
2 June 2023
30 June 2026
$0.06
7,500,000
13 June 2023
30 June 2025
$0.06
24,000,000
4 September 2023
4 September 2025
$0.10
33,058,032
20 December 2023
20 December 2025
$0.06
3,000,000
6 June 2024
31 May 2027
$0.03
105,000,000
368,558,032
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 under performance rights
Unissued ordinary shares of IXUP under performance rights at the date of this report are as follows:
Grant date
Expiry date
Exercise
price
Number
under rights
5 October 2021
31 March 2025
$0.00
11,000,000
9 December 2021
31 December 2024
$0.00
50,000,000
3 February 2023
3 February 2026
$0.00
36,757,299
97,757,299
No person entitled to exercise the performance rights had or has any right by virtue of the performance right to participate in
any share issue of the Company or of any other body corporate.
Shares issued on the exercise of options
There were no ordinary shares of IXUP issued on the exercise of options during the year ended 30 June 2024 and up to the
date of this report.
16
IXUP Limited
Directors report
30 June 2024
Shares issued on the exercise of performance rights
There were no ordinary shares of IXUP issued on the exercise of performance rights during the year ended 30 June 2024
and up to the date of this report.
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.
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 (Cth) 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 directors of Hall Chadwick WA Audit Pty Ltd
There are no officers of the company who are former directors of Hall Chadwick WA 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
Hall Chadwick WA Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.
17
IXUP Limited
Directors report
30 June 2024
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
Julian Babarczy
Chairman
30 September 2024
To the Board of Directors,
AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE
CORPORATIONS ACT 2001
As lead audit director for the audit of the financial statements of IXUP Limited for the period ended 30 June
2024, I declare that to the best of my knowledge and belief, there have been no contraventions of:
•
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
•
any applicable code of professional conduct in relation to the audit.
Yours Faithfully
HALL CHADWICK WA AUDIT PTY LTD
MARK DELAURENTIS CA
Director
Dated this 30th day of September 2024
Perth, Western Australia
19
IXUP Limited
Contents
30 June 2024
Consolidated statement of profit or loss and other comprehensive income
20
Consolidated statement of financial position
21
Consolidated statement of changes in equity
22
Consolidated statement of cash flows
23
Notes to the financial statements
24
Directors’ declaration
57
Independent auditor’s report to the members of IXUP Limited
58
Shareholder information
63
General information
The consolidated financial report covers IXUP Limited (the "Company") and its controlled entities (together the "Consolidated
Entity" or "Group").
IXUP Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and
principal place of business is:
Level 11
201 Miller Street
North Sydney, NSW, 2060
A description of the nature of the consolidated entity's operations and its principal activities are included in the directors'
report, which is not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of directors, on 30 September 2024.
The directors have the power to amend and reissue the financial statements.
Corporate Governance Statement
The Corporate Governance Statement is available on the Company's website at http://www.ixup.com.
20
IXUP Limited
Consolidated statement of profit or loss and other comprehensive income
For the year ended 30 June 2024
Consolidated
Note
2024
$
2023
$
Revenue
Revenue
4
6,630,857
1,256,161
Cost of sales
5
(1,264,841)
(605,623)
Gross profit
5,366,016
650,538
Interest revenue calculated using the effective interest method
7,946
35,870
Research & Development Tax rebate
1,582,688
1,104,398
Expenses
Employee benefits expense
5
(6,302,128)
(5,471,660)
Share-based costs
37
(2,004,893)
(2,985,526)
Depreciation and amortisation expense
5
(1,907,546)
(1,070,307)
Doubtful Debt expense
8
-
(110,077)
Impairment of Goodwill
11
-
(13,189,096)
Occupancy cost
5
643
(19,302)
Administration costs
5
(6,221,675)
(5,799,652)
Finance costs
5
(799,409)
(42,588)
Loss before income tax expense
(10,278,358)
(26,897,402)
Income tax (expense)/benefit
6
-
336,141
Loss after income tax expense for the year attributable to the shareholders of
IXUP Limited
23
(10,278,358)
(26,561,261)
Other comprehensive income for the year, net of tax
(265,637) (136,855)
Total comprehensive loss for the year attributable to the shareholders of IXUP
Limited
(10,543,995) (26,698,116)
Cents
Cents
Basic earnings per share
36
(0.87)
(2.68)
Diluted earnings per share
36
(0.87)
(2.68)
The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes
21
IXUP Limited
Consolidated statement of financial position
As at 30 June 2024
Consolidated
Assets
Note
2024
$
2023
$
Current assets
Cash and cash equivalents
7
1,147,951
1,642,869
Trade and other receivables
8
1,508,041
978,164
Prepayments
28,128
65,248
Total current assets
2,684,120
2,686,281
Non-current assets
Property, plant and equipment
9
302,454
56,868
Right-of-use assets
10
862,188
155,024
Intangibles
11
2,241,459
3,967,722
Investments
12
359,020 359,020
Deposits
13
269,939 153,919
Total non-current assets
4,035,060
4,692,553
Total assets
6,719,180
7,378,834
Liabilities
Current liabilities
Trade and other payables
14
2,296,271
1,625,296
Lease liabilities
15
223,370
68,593
Provisions
16
444,301
600,390
Deferred revenue
17
- ____ 40,252
Total current liabilities
2,963,942
2,334,531
Non-current liabilities
Other financial liabilities
18
-
146,347
Borrowings
19
194,705
2,618,087
Lease liabilities
20
672,718
90,697
Provisions
21
119,679 204,498
Total non-current liabilities
987,102 3,059,630
Total liabilities
3,951,044
5,394,161
Net assets
2,768,136
1,984,673
Equity
Issued capital
22
61,778,002
52,355,200
Reserves
23
17,069,687
18,219,805
Accumulated losses
23
(76,079,553)
(68,590,332)
Total equity
2,768,136
1,984,673
The above statement of financial position should be read in conjunction with the accompanying notes
IXUP Limited
Consolidated statement of changes in equity
For the year ended 30 June 2024
22
Consolidated
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
Balance at 1 July 2022
47,821,869
16,115,343 (43,400,697)
20,536,515
Loss after income tax expense for the year
-
-
(26,561,261)
(26,561,261)
Other comprehensive income for the year, net of tax
- (136,855)
- (136,855)
Total comprehensive loss for the year
-
(136,855)
(26,561,261)
(26,698,116)
Issue of shares
5,099,837
-
-
5,099,837
Share issue costs – Cash
(359,524)
-
-
(359,524)
Share issue costs - equity
(355,000)
355,000
-
-
Transactions with shareholders in their capacity as
shareholders:
Share-based payments (note 38)
-
2,985,527
-
2,985,527
Options related to Convertible note
272,416
-
272,416
Options Exercised
-
(1,371,626)
1,371,626
-
Contingent consideration for DataPOWA acquisition
148,018
-
-
148,018
Balance at 30 June 2023
52,355,200
18,219,805
(68,590,332)
1,984,673
Consolidated
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
Balance at 1 July 2023
52,355,200
18,219,805
(68,590,332)
1,984,673
Loss after income tax expense for the year
-
-
(10,278,358)
(10,278,358)
Other comprehensive income for the year, net of tax
- (265,637) - (265,637)
Total comprehensive loss for the year
(265,637)
(10,278,358)
(10,543,995)
Issue of shares
7,219,523
(374,310)
-
6,845,213
Share issue costs - Cash
(942,782)
523,787
-
(418,995)
Conversion of Convertible notes into Shares
2,999,714
(249,714)
-
2,750,000
Transactions with shareholders in their capacity as
shareholders:
Share-based payments (note 37)
-
2,004,893
-
2,004,893
Options Expired
-
(2,789,137)
2,789,137
-
Contingent consideration for DataPOWA acquisition
146,347
-
-
146,347
Balance at 30 June 2024
61,778,002
17,069,687
(76,079,553) 2,768,136
The above statement of changes in equity should be read in conjunction with the accompanying notes
IXUP Limited
Consolidated statement of cash flows
For the year ended 30 June 2024
23
Consolidated
Note
2024
2023
$
$
Cash flows from operating activities
Receipts from customers
6,724,189
681,339
Interest and other finance costs paid
(418,925) (32,600)
Payments to suppliers and employees
(14,155,245) (11,144,412)
Interest received
7,947
18,051
Government grants and tax incentives (R&D Incentive, JobKeepers Rebate, Cash
Boost, EMD Grant)
1,582,688 1,045,507
Net cash used in operating activities
34
(6,259,346) (9,432,115)
Cash flows from investing activities
Payments for property, plant and equipment
9
(316,333)
(43,407)
Payments for intangibles
11
-
(1,364,955)
Payments for investments in term deposits
(226,998)
(18,900)
Payments for Investments in Convertible Notes
- -
Proceeds from term deposits
28,625
-
Other - DataPOWA cash on acquisition
-
-
Net cash used in investing activities
(514,706)
(1,427,262)
Cash flows from financing activities
Proceeds from issue of shares
6,845,214
5,099,837
Payment for share and issue transaction costs
(418,995)
(360,986)
Proceeds from issue of options
-
-
Proceeds of issue of Convertible Note
-
3,000,000
Repayment of borrowings
(9,955)
(6,022)
Repayment of lease liabilities
(144,060)
(84,350)
Net cash from financing activities
6,272,204
7,648,479
Net increase in cash and cash equivalents
(501,848)
(3,210,898)
Cash and cash equivalents at the beginning of the financial year
1,642,869
4,816,710
Effects of exchange rate changes on cash and cash equivalents
6,930 37,057
Cash and cash equivalents at the end of the financial year
7
1,147,951
1,642,869
The above statement of cash flows should be read in conjunction with the accompanying notes
IXUP Limited
Notes to the financial statements
30 June 2024
24
Note 1. 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 consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
Going concern
The financial report has been prepared on a going concern basis which assumes the settlement of liabilities and the
realisation of assets in the normal course of business.
The Group has incurred a loss of $10,278,358 (2023: $26,561,261) and experienced net cash outflows from operating
activities of $6,259,346 (2023: $9,432,115). As at 30 June 2024, the Group had cash and cash equivalents of $1,147,951
(2023: $1,642,869).
The Group’s ability to continue as a going concern, to recover the carrying value of its assets and meet its commitments as
and when they fall due is dependent on the ability of the Group to raise additional capital or obtain external financing in the
next few months. The Board is assessing capital raising opportunities as at the date of this report.
The Directors believe that the Group will be able to continue as a going concern after consideration of the following factors:
●
The ability of the Company to raise the additional capital, for which it has a successful history in doing so;
●
Commercialisation of its intellectual property, to deliver future revenue; and
●
Recognising that the priority of the Board and management remains revenue growth and cost reductions.
Whilst the directors acknowledge there are timing risks associated with the completion of successful capital raisings which
have a direct impact on the Company's ability to meet liabilities when due, the directors believe that this will be successful.
However, if the capital raising and other factors mentioned above do not eventuate, there is a material uncertainty that may
cast significant doubt as to whether the Company will continue as a going concern and, therefore, whether the Company will
realise its assets and discharge its liabilities in the normal course of business and at the amounts stated in the financial
statements.
On the 26th of September, the Company announced it had firm commitments for $1.85m via a share placement, which is
expected to settle on the 3rd October 2024. Participants will receive one free attaching unlisted option for every 2 shares
subscribed and the proceeds will be used to enhance IXUP’s sales pipeline and advance sales conversion activities as well
as facilitate ongoing business transformation.
The financial statements do not include adjustments relating to the recoverability and classification of recorded asset amounts
nor to the amounts and classification of liabilities that might be necessary should the Company not continue as a going
concern.
Basis of preparation
IXUP Limited is domiciled in Australia. The consolidated financial statements comprise the results of IXUP Limited ("the
Company") and its controlled entities ("the Group"). The consolidated financial statements have been prepared in accordance
with Australian Accounting Standards and Interpretations issued by the Australia 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, except for, where applicable, the valuation
of share-based payments.
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 2.
IXUP Limited
Notes to the financial statements
30 June 2024
Note 1. Significant accounting policies (continued)
25
The significant accounting policies adopted in the preparation of these financial statements are presented below.
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 29.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and the entities controlled by the
Company. Control is achieved when the Company:
- Has power over the investee;
- Is exposed, or has rights, to variable returns from its involvement with the investee; and
- Has the ability to use its power to affect its returns.
The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes
to one or more of the three elements of control listed above.
All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of
the IXUP Group are eliminated in full on consolidation.
Foreign Currencies
In preparing the financial statements, transactions in currencies other than the Group's functional currency (foreign
currencies) are recognised at the rates of exchange prevailing at the dates of the transactions.
Revenue recognition
All revenue is stated net of the amount of goods and services tax (GST).
The core principle of AASB 15 is that revenue is recognised on a basis that reflects the transfer of promised goods or services
to customers at an amount that reflects the consideration the Company expects to receive in exchange for those goods or
services. Revenue is recognised by applying a five-step process outlined in AASB 15 which is as follows:
Step 1: Identify the contract with a customer;
Step 2: Identify the performance obligations in the contract and determine at what point they are satisfied;
Step 3: Determine the transaction price;
Step 4: Allocate the transaction price to the performance obligations;
Step 5: Recognise revenue as the performance obligations are satisfied.
(i) Identification of performance obligations
The Group has determined that for new software sales, the licenses and implementation services are quoted as separate
line items and have separate list prices and therefore are not distinct performance obligations as the customer is purchasing
customisable software which requires not only the licenses to be provisioned but the software to be installed by a qualified
implementation consultant.
Licensing and technical support which is purchased by software customers to assist with their ongoing use of the software
and is separate from the software implementation performance obligation.
(ii) Satisfaction of performance obligations
The performance obligation for the implemented software is satisfied at the point in time when the software has been installed
and is operating materially as contractually required. It is when the customer has full access to and control of the software
The performance obligation for providing software customers with licensing and technical support remains throughout the
contract period so is satisfied over the contract period.
In addition to contracts with customers, the Group receives interest income from monies held in its bank accounts, Interest
income is recognised on an accruals basis based on the interest rate, deposited amount and time which lapses before the
reporting period end date.
IXUP Limited
Notes to the financial statements
30 June 2024
Note 1. Significant accounting policies (continued)
26
The expected future Research and Development incentive, for past qualifying Research and Development expenditure is
accrued as other income when it is established that the conditions of the Research and Development incentive have been
met and that the expected amount of the incentive can be reliably measured.
Government Grants
Government grants are recognised when there is reasonable assurance that the Company will comply with the conditions
attaching to the grant and that the grant will be received. Government grants are recognised in profit or loss on a systematic
basis over the periods in which the entity recognises as expenses the related costs for which grants are intended to
compensate. If the grant relates to expenses or losses already incurred by the entity, or to provide immediate financial support
to the entity with no future related costs, the income is recognised int eh period in which it becomes receivable.
Cash and cash equivalents
Cash and cash equivalents comprises cash on hand, demand deposits and short-term investments which are readily
convertible to known amounts of cash and which are subject to an insignificant risk of change in value.
Derivative financial instruments
Hedges of a net investment
Hedges of a net investment in a foreign operation include monetary items that are considered part of the net investment.
Gains or losses on the hedging instrument relating to the effective portion of the hedge are recognised directly in equity whilst
gains or losses relating to the ineffective portion are recognised in profit or loss. On disposal of the foreign operation, the
cumulative value of any such gains or losses recognised directly in equity is transferred to profit or loss.
Financial Instruments
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the
instrument.
Financial assets
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, it's carrying value is written off.
Financial assets at fair value through profit or loss
Financial assets not measured at amortised cost or at fair value through other comprehensive income are classified as
financial assets at fair value through profit or loss. Typically, such financial assets will be either: (i) held for trading, where
they are acquired for the purpose of selling in the short-term with an intention of making a profit, or a derivative; or (ii)
designated as such upon initial recognition where permitted. Fair value movements are recognised in profit or loss.
Financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income include equity investments which the Group intends to
hold for the foreseeable future and has irrevocably elected to classify them as such upon initial recognition.
Compound financial instruments
The component parts of convertible loan notes issued by the Group are classified separately as financial liabilities and equity
in accordance with the substance of the contractual arrangements and definitions of a financial liability and an equity
instrument. A conversion option that will be settled by the exchange of a fixed amount of cash or another financial asset for a
fixed number of the Company’s own equity instruments is an equity instrument.
At the date of issue, the fair value of the liability component is estimated using the prevailing market interest rate for a similar
non-convertible instrument. This amount is recorded as a liability on an amortised cost basis using the effective interest
method until extinguished upon conversion or at the instrument’s maturity date.
The Conversion option classified as equity is determined by deducting the amount of the liability component from the fair
value of the compound instrument as a whole. This is recognized and included in equity, net of income tax effect, and is not
subsequently remeasured. In addition, the conversion option classified as equity will remain in equity until the conversion
IXUP Limited
Notes to the financial statements
30 June 2024
Note 1. Significant accounting policies (continued)
27
option is exercised, in which case the balance is recognized in equity will be transferred to the Share premium account.
Where the conversion option remains unexercised at the maturity date of the convertible loan note, the balance recognized in
equity will be transferred to retained earnings. No gain or loss is recognized in profit or loss upon conversion or expiration of
the conversion option Transaction costs that relate to the issue of the convertible loan notes are allocated to the liability and
equity components in proportion to the allocation of gross proceeds. Transaction costs relating to the equity component are
recognized directly in equity. Transaction costs relating to the liability component are included in the carrying amount of the
liability component and are amortised over the lives of the convertible loan notes using the effective interest method. Refer to
note 26 for further information on financial instruments.
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.
For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within
other comprehensive income. In all other cases, the loss allowance is recognised in profit or loss.
Impairment of non-financial assets
Goodwill and other intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually
for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other 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 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.
Property, plant and equipment
Each class of property, plant and equipment is carried at cost less, where applicable, any accumulated depreciation and
impairment losses. Plant and equipment are measured using the cost model.
Costs include purchase price, other directly attributable costs and the initial estimate of the costs of dismantling and restoring
the asset, where applicable.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives,
using the straight-line method. The estimated useful lives, residual values and depreciation method are reviewed at the end
of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. An individual asset
will be depreciated in full at the time of purchase if any of the following criteria is met:
IXUP Limited
Notes to the financial statements
30 June 2024
Note 1. Significant accounting policies (continued)
28
- The cost of the asset is less than $2,000, or
- The asset has an expected useful life of less than 12 months, or
- The asset will become technically obsolete (particularly relating to computer equipment) in less than 12 months.
Buildings
40 years
Leasehold improvements
3-10 years
Plant and equipment
3-7 years
Computer equipment
3-5 years
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 included in 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 consolidated entity 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 consolidated entity 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.
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.
Research and development
Expenditure on research activities is recognised as an expense in the period in which it is incurred. Where no internally-
generated intangible can be recognised, development expenditure is recognised in profit or loss in the period in which it is
incurred.
An internally-generated intangible asset arising from development (or from the development phase of an internal project) is
recognised if, and only if, all of the following have been demonstrated:
- the technical feasibility of completing the intangible asset so that it will be available for use or sale:
- the intention to complete the intangible asset and use or sell it;
- the ability to use or sell the intangible asset; and
- how the intangible asset will generate probable future economic benefits.
Amortisation is recognised so as to write off the cost of internally-generated assets over their useful lives, using the straight-
line method. The estimated useful lives and amortisation method are reviewed at the end of each reporting period, with the
effect of any changes in estimate accounted for on a prospective basis.
Goodwill
Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested annually for impairment,
or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less
accumulated impairment losses. Impairment losses on goodwill are taken to profit or loss and are not subsequently reversed.
Website
Significant costs associated with the development of the revenue generating aspects of the website, including the capacity
of placing orders, are deferred and amortised on a straight-line basis over the period of their expected benefit, being their
finite life of 10 years.
IXUP Limited
Notes to the financial statements
30 June 2024
Note 1. Significant accounting policies (continued)
29
Intellectual property
Significant costs associated with intellectual property are deferred and amortised on a straight-line basis over the period of
their expected benefit, being their finite life of 5 years.
Trademarks and other intangibles including customer contracts
Significant costs associated with Trademarks and other intangibles are deferred and amortised on a straight-line basis over
the period of their expected benefit, being their finite life of 8 years.
Software
Significant costs associated with software are deferred and amortised on a straight-line basis over the period of their expected
benefit, being their finite life of 3.33 years.
Contract liabilities
Contract liabilities represent the consolidated entity's obligation to transfer goods or services to a customer and are
recognised when a customer pays consideration, or when the consolidated entity recognises a receivable to reflect its
unconditional right to consideration (whichever is earlier) before the consolidated entity has transferred the goods or services
to the customer.
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 consolidated entity'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.
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.
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 using the projected unit credit method. 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.
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of
the equity instruments at the grant date. Details regarding the determination of the fair value of equity-settled share-based
transactions are set out in the notes to the accounts.
Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the
rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash
is determined by reference to the share price.
The costs of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined
using an appropriate option valuation 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
IXUP Limited
Notes to the financial statements
30 June 2024
Note 1. Significant accounting policies (continued)
30
conditions.
The costs 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.
All changes in the liability are recognised in profit or loss. The ultimate cost of cash-settled transactions is the cash paid to
settle the liability.
Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions
are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are
satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value of
the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the 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.
Fair value measurement
Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and transfers
between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value
measurement.
For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not
available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and
reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is
undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where
applicable, with external sources of data.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the
amount of GST incurred is not recoverable from the Australian Taxation Office (ATO).
Receivables and payables are stated inclusive of GST. The net amount of GST recoverable from, or payable to, the ATO is
included as part of receivables or payables in the statement of financial position.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit before tax as reported in
the statement of profit or loss and other comprehensive income because of items of income or expense that are taxable or
deductible in other years and items that are never taxable or deductible. The Group’s current tax is calculated using tax rates
that have been enacted or substantively enacted by the end of the reporting period.
Current tax liabilities are therefore measured at the amounts expected to be paid to / recovered from the relevant taxation
authority.
Deferred tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally
recognised for all taxable temporary differences.
IXUP Limited
Notes to the financial statements
30 June 2024
Note 1. Significant accounting policies (continued)
31
Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that
taxable profits will be available against which those deductible temporary differences can be utilised. Such deferred tax
assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business
combination) of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory,
have not been early adopted by the consolidated entity for the annual reporting period ended 30 June 2023. There are no
standards that are not yet effective and that are expected to have a material impact on the entity in the current or future
reporting periods and on foreseeable future transactions.
Note 2. Critical accounting judgements, estimates and assumptions
In the application of the Group’s accounting policies, which are described in Note 1, the directors are required to make
judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent
from other sources. The estimates and associated assumptions are based on historical experience and other factors that are
considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the revision affects only that period. Alternatively, if the revision
affects both current and future periods, the revision to the accounting estimate is recognised in the period of the revision as
well as in future periods.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by using the Black-Scholes model taking into
account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions
relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within
the next annual reporting period but may impact profit or loss and equity.
Estimation of useful lives of assets
The Group determines the estimated useful lives and related depreciation and amortisation charges for its property, plant
and equipment and finite life intangible assets. The useful lives could change significantly as a result of technical innovations
or some other event. The depreciation and amortisation charge will increase where the useful lives are less than previously
estimated lives, or technically obsolete or non-strategic assets that have been abandoned or sold will be written off or written
down.
IXUP Limited
Notes to the financial statements
30 June 2024
32
Note 3. Operating segments
Identification of reportable operating segments
The Group currently operates in one operating segment being the software industry. The Group continues to consider new
projects in this sector and others by way of acquisition or investment. The Group operated in three geographic segments that
being Australia, UK and US.
The Group determines and presents segments based on information provided by the Board of directors who collectively are
the Group's Chief Operating Decision Maker. An operating segment is a component of the Group that engages in business
activities from which it may earn revenues and incur expenses.
Operating segment information
FY2024
AUSTRALIA
UK
US
TOTAL
ADJUSTMENTS
AND
ELIMINATIONS
CONSOLIDATED
REVENUE ($)
Sales to external
customers
6,233,682
397,175
-
6,630,857
-
6,630,857
Interest Income
7,946
-
-
7,946
-
7,946
Total Revenue
6,241,628
397,175
-
6,638,803
-
6,638,803
Income/(Expenses)
Other Income
1,338,689
243,999
-
1,582,688
-
1,582,688
Employee Expenses
(7,490,484)
(816,536)
-
(8,307,020)
-
(8,307,020)
Depreciation and
Amortisation
(1,525,646)
(381,900)
-
(1,907,546)
-
(1,907,546)
Other expenses
(7,141,388)
(799,798)
(344,098)
(8,285,284)
-
(8,285,284)
Segment Profit
(8,577,201)
(1,357,060)
(344,098)
(10,278,359)
-
(10,278,359)
Total Assets
6,543,668
110,737
64,775
6,719,180
-
6,719,180
Total Liabilities
3,853,724
85,313
12,007
3,951,044
-
3,951,044
FY2023
AUSTRALIA
UK
US
TOTAL
ADJUSTMENTS
AND
ELIMINATIONS
CONSOLIDATED
REVENUE ($)
Sales to external
customers
634,026
278,905
343,229
1,256,161
-
1,256,161
Interest Income
35,870
-
-
35,870
-
35,870
Total Revenue
669,897
278,905
343,229
1,292,031
-
1,292,031
Income/(Expenses)
Other Income
867,791
236,607
-
1,104,398
-
1,104,398
Employee Expenses
(6,967,494)
(1,255,427)
(234,265)
(8,457,186)
-
(8,457,186)
Depreciation and
Amortisation
(13,876,416)
(382,987)
-
(14,259,403)
-
(14,259,403)
Other expenses
(5,206,503)
(1,032,833)
(1,766)
(6,241,102)
-
(6,241,102)
Segment Profit
(24,480,151)
(2,188,309)
107,198
(26,561,261)
-
(26,561,261)
Total Assets
5,787,615
752,319
838,900
7,378,834
-
7,378,834
Total Liabilities
5,245,580
147,800
781
5,394,161
-
5,394,161
Note 4. Revenue
Consolidated
2024
2023
$
$
Software revenue
6,630,857 1,256,161
IXUP Limited
Notes to the financial statements
30 June 2024
33
Note 5. Expenses
Consolidated
2024
2023
$
$
Loss before income tax includes the following specific expenses:
Cost of sales
Cost of sales
(1,264,841)
(605,623)
Depreciation
Depreciation
194,087
97,034
Amortisation
1,713,459
973,273
Total depreciation and amortisation
1,907,546
1,070,307
Administrative Costs
Professional adviser and legal costs
3,052,563
2,697,506
Consulting costs paid to entities related to the directors
254,571
171,550
Recruitment costs
94,915
39,830
Advertising and promotion
44,532
85,318
Travel and accommodation
181,999
422,404
Software licenses
608,877
829,794
Insurance
359,680
191,086
Other
1,624,538
1,362,164
6,221,675
5,799,652
Employee benefits expense
Wages and salaries
6,007,880
4,746,458
Superannuation costs
535,156
315,737
Other employee benefits
(240,908)
409,465
6,302,128
5,471,660
Occupancy costs
Rent (short term lease payments)
(643)
19,302
Other occupancy costs
-
-
(643)
19,302
Finance costs
Interest costs
2,083
1,857
Interest and finance charges related to Convertible note 725,090 30,947
Interest and finance charges paid/payable on lease liabilities
72,236
9,784
Finance costs expensed
799,409
42,588
Share-based payments expense
Share-based payments expense
2,004,893
2,985,526
Impairment of Goodwill
Impairment of Goodwill related to DataPOWA Acquisition
-
15,269,731
Write back of contingent consideration liability
-
(2,080,635)
Impairment of Goodwill
-
13,189,096
IXUP Limited
Notes to the financial statements
30 June 2024
34
Note 6. Income tax expense
Consolidated
2024
2023
$
$
Numerical reconciliation of income tax expense and tax at the statutory rate
Loss before income tax expense
(10,278,358)
(26,561,261)
Tax at the statutory tax rate of 25% (2023: 25%)
(2,569,590)
(6,640,316)
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Share-based payments
501,223
746,382
Non deductible Impairment of Goodwill
-
3,297,274
Non assessable other income
-
-
Non assessable Research & Development refund
395,672 216,948
(1,672,695)
(2,379,712)
Current year temporary differences not recognised
1,672,695
2,043,571
Income tax expense/(benefit)
-
(336,141)
Consolidated
2024
2023
$
$
Tax losses not recognised
Unused tax losses for which no deferred tax asset has been recognised
41,108,929 35,338,783
Potential tax benefit at statutory tax rates
10,277,231
6,508,873
The above potential tax benefit for tax losses has not been recognised in the statement of financial position. These tax losses
can only be utilised in the future if the continuity of ownership test is passed, or failing that, the same business test is passed.
The tax rate used for the reconciliation above is the relevant corporate tax rate payable by the Company on taxable profits
under Australian tax law.
Deferred tax assets and liabilities
Consolidated
2024
2023
$
$
Deferred tax assets not recognised
Deferred tax assets not recognised comprises temporary differences attributable to:
Employee benefits (60,227)
102,366
Entertainment
(2,527)
(402)
Depreciation
1,722
1,722
Payroll accrual
15,070
(5,880)
Deferred tax assets used to offset deferred tax liabilities
23,708
648,227
Tax losses carried forward
10,277,231
8,809,220
Deferred tax assets not brought into account
(10,254,977) (9,555,253)
Total deferred tax assets recognised
-
-
IXUP Limited
Notes to the financial statements
30 June 2024
35
Note 6. Income tax expense (continued)
Consolidated
2024
2023
$
$
Deferred tax liability
Accrued expenses
(94,833)
(312,086)
Acquisition of Customer Contracts
- (336,141)
Deferred tax assets used to offset deferred tax liabilities
94,833
648,227
-
-
Deferred tax assets have not been recognised in respect of the above items because it is not possible at this stage of
development to explicitly confirm the probability that future taxable profit will be available against which the Company can
utilise these benefits.
Note 7. Current assets - cash and cash equivalents
Consolidated
2024
2023
$
$
Cash at bank
1,097,951 1,542,869
Term deposits
50,000 100,000
1,147,951
1,642,869
Term deposits has an interest rate of 4.30% p.a.
Note 8. Current assets - Trade and other receivables
Consolidated
2024
2023
$
$
Trade receivables
1,413,317
994,066
Other receivables
- -
GST
94,724
94,175
Provision for doubtful debts
-
(110,077)
1,508,041
978,164
Allowance for expected credit losses
The consolidated entity has recognised a doubtful debts expense of $Nil (2022: $110,077) in profit or loss in respect of the
expected credit losses for the year ended 30 June 2024.
Trade
Receivables
($)
Gross 2024
Impaired 2024
Net 2024
Past due but
no impaired
2024
Gross 2023
Impaired 2023
Net 2023
Past due but
not impaired
2023
Not past Due
1,001,341
-
1,001,341
-
814,089
-
814,089
-
Past due up to
30 days
398,776
-
398,776
-
-
-
-
-
Past due 31
days to 90
days
-
-
-
-
-
-
-
-
Past due over
90 days
13,200
-
13,200
13,200
179,977
(110,077)
69,900
69,900
1,413,317
-
1,413,317
13,200
994,066
(110,077)
69,900
69,900
IXUP Limited
Notes to the financial statements
30 June 2024
36
Note 9. Non-current assets - property, plant and equipment
Consolidated
2024
2023
$
$
Computer equipment - at cost. 161,717 149,966
Less: Accumulated depreciation
(122,589) (96,158)
39,128 53,808
Office equipment - at cost 320,618 16,035
Less: Accumulated depreciation
(57,292) (12,975)
263,326 3,060
302,454 56,868
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Computer
equipment
$
Office
equipment
$
Total
$
Balance at 1 July 2023
33,317
3,444
36,761
Additions
39,038
2,153
41,191
Disposals
(2,398)
(93)
(2,491)
Exchange Differences
554
-
554
Depreciation expense
(16,703)
(2,444)
(19,147)
Balance at 30 June 2023
53,808
3,060
56,868
Additions
11,750
304,583
316,333
Disposals
-
-
-
Exchange differences
-
-
-
Depreciation expense
(26,430) (44,317)
(70,747)
Balance at 30 June 2024
39,128 263,326 302,454
Note 10. Non-current assets - right-of-use assets
Consolidated
2024
2023
$
$
Right-of-use asset
994,832
230,928
Less: Accumulated depreciation
(132,644)
(75,904)
862,188
155,024
The consolidated entity leases an office with lease terms of 5 years. The lease commenced 1 November 2023. Depreciation for
the year for the right-of-use asset was $132,644.
IXUP Limited
Notes to the financial statements
30 June 2024
37
Note 10. Non-current assets - right-of-use assets (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
Right-of-use
asset
$
Total
$
Balance at 1 July 2022
233,151
233,151
Additions
-
-
Depreciation expense
(78,127)
(78,127)
Balance at 30 June 2023
155,024
155,024
Additions
994,832
-
Disposals
(155,024)
Depreciation expense
(132,644)
(78,127)
Balance at 30 June 2024
862,188
155,024
Note 11. Non-current assets - intangibles
Consolidated
2024
2023
$
$
Goodwill - at cost
406,288
406,288
Customer Contracts - at cost
1,344,565 1,344,456
Less: Accumulated amortisation
(713,679)
-
630,886 1,344,456
Development - at cost
1,731,909
1,731,909
Less: Accumulated amortisation
(1,731,909)
(1,731,909)
-
-
Website - at cost
1,194,680 1,194,680
Less: Accumulated amortisation
(1,180,980)
(763,268)
13,700 431,412
Intellectual Property
3,014,316
3,014,316
Less: Accumulated amortisation
(1,823,731)
(1,288,859)
1,190,585
1,785,457
2,241,459
3,967,722
IXUP Limited
Notes to the financial statements
30 June 2024
38
Note 11. 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
Goodwill
$
Customer
Contracts
$
Website
$
Intellectual
Property
$
Total
$
Balance at 1 July 2022
15,269,731
- 778,048 2,340,373
18,388,152
Additions through business combinations (Note
32)
406,288
1,344,565
74,291
39,956
1,865,100
Amortisation expense
(15,269,731)
-
(420,927) (594,872) (16,285,530)
Balance at 30 June 2023
406,288
1,344,565
431,412
1,785,457
3,967,722
Additions - - - - -
Amortisation expense
- (713,679)
(417,712)
(594,872) (1,726,263)
Impairment expense - - - - -
Balance at 30 June 2024
406,288 630,886
13,700
1,190,585
2,241,459
The Company reviews its intangible assets for impairment when events or changes in circumstances indicate the carrying
value may not be recoverable.
Goodwill
During the financial year 2023 the company purchased the contract to operate and develop BetStop – The National Self
Exclusion register for $1,325,000. The identification and fair value measurement of the assets and liabilities acquired from
the BetStop acquisition are provisional and amendments may be made to these figures up to 12 months following the date of
acquisition. Per note 30 $406,288 has been recognized as Goodwill in relation to the acquisition.
Goodwill is subject to impairment testing on an annual basis or whenever there is an indication of impairment. Capitalised
development costs, website and software costs are subject to impairment testing whenever there is an indication of
impairment.
Customer Contracts
During the financial year 2023 the company purchased the contract to operate and develop BetStop – The National Self
Exclusion register for $1,325,000. The identification and fair value measurement of the assets and liabilities acquired from
the BetStop acquisition are provisional and amendments may be made to these figures up to 12 months following the date of
acquisition. Per note 30 $1,344,465 has been recognized as Customer Contracts in relation to the acquisition.
Customer Contracts are impaired over the period of the contract length.
Website
During the year ended 30 June 2024, the gross carrying value of Website equated to $1,194,680 (2023;$1,194,680). This
asset is being depreciated on a straight-line basis at 33% per annum.
Accumulated depreciation of this Website totaled $1,180,980 (2023; $763,268), giving net written down value of $13,700
(2023: $431,412) at financial year end.
Intellectual Property
During the year ended 30 June 2021, the company completed the strategic acquisition of the entire intellectual property of
Data Republic Pty Ltd. The acquisition is capitalised at cost of $2,974,360 and is being depreciated on a straight-line basis
at 20% per annum. During the financial period the Company purchased the trademark, URL and other intellectual property
of Playpause for $25,000 USD
Accumulated depreciation of this Intellectual Property totaled $1,823,731, giving net written down value of $1,190,585 at
financial year end.
IXUP Limited
Notes to the financial statements
30 June 2024
39
Based on the replacement value to develop the intellectual property of Data Republic and the ongoing commercialisation of
the software no indicators of impairment were identified as at 30 June 2024.
Note 12. Non-current assets - Investments
Consolidated
2024
2023
$
$
Investments in other entities
359,020 359,020
IXUP invested in a convertible note in Ziroh Labs Inc, on 18 April 2022 for $240k USD. The note had a 12 month maturity
date, 5% per annum interest rate and option to be repaid or converted to common stock. Participation in the note allowed
IXUP to purchase a 10 year royalty free licence for Ziroh Labs Inc. products including homomorphic libraries for $10k USD.
IXUP converted the note to common stock.
Note 13. Non-current assets - Deposits
Consolidated
2024
2023
$
$
Security Deposit
269,939 153,919
This amount represents two security deposits for the office space rented and US payroll supplier. On termination or
cancellation of both contracts the deposits will be refunded.
Note 14. Current liabilities - trade and other payables
Consolidated
2024
$
2023
$
Trade payables
621,822
795,024
Accrued expenses
145,709
669,589
PAYG withholding payable
1,348,843
137,734
Superannuation payable
142,127
81,793
Wages payable
12,614
(14,198)
Other payables
25,156
(44,646)
2,296,271
1,625,296
Refer to note 25 for further information on financial instruments.
The average credit period allowed by trade creditors to the Group which are not related parties is approximately 36 days.
Note 15. Current liabilities – lease liabilities
Consolidated
2024
2023
$
$
Lease liability
223,370 68,593
Refer to note 25 for further information on financial instruments.
This balance relates to the application of accounting standard AASB 16 in effect from 1 July 2019. Refer to note 10 for details.
The consolidated entity leases an office with lease terms of 5 years, which commenced 1 November 2023.
IXUP Limited
Notes to the financial statements
30 June 2024
40
Note 16. Current liabilities – provisions
Consolidated
2024
2023
$
$
Annual leave 391,281 365,416
Long Service Leave
53,020
234,974
444,301 600,390
Note 17. Current liabilities – Deferred revenue
Consolidated
2024
2023
$
$
Deferred revenue
-
40,252
Note 18. Non-Current liabilities – Other financial liabilities
Consolidated
2024
2023
$
$
Contingent Consideration
- 146,347
The provision represents the obligation to pay contingent consideration following the acquisition of DataPOWA Limited. For
more information refer to note 31.
Note 19. Non-Current liabilities – Borrowings
Consolidated
2024
2023
$
$
Bank Loans
20,560
30,515
Convertible Note
174,145 2,587,572
194,705 2,618,087
The Convertible notes were issued on 13 June 2023 at an issue price of $1 per note, with 3,000,000 issued. The notes are
convertible into ordinary shares prior to an expiry term of 24 month term from date of issue and a conversion price of $0.06
per share. The note has a conversion incentive if the holder converts in the first 12 months of the note term, the holders will
receive a free attaching 1:2 option with a 10c strike expiring 3rd Feb 2025. $2,750,000 was converted into shares at $0.015 on
the 8 April 2024.
If the notes have not been converted, interest of 15% annually, to be paid quarterly.
The net proceeds received from the issue of the convertible notes have been split between the financial liability element and
an equity component, representing the fair value of the embedded option to convert the financial liability into equity of the
company as follows:
Proceeds of issue of convertible note
$3,000,000
Transactions costs
($150,000)
Net proceeds from issue of convertible note
$2,850,000
IXUP Limited
Notes to the financial statements
30 June 2024
41
Note 19. Non-Current liabilities – Borrowings (Cont.)
Equity Component
272,416
Liability component at date of issue (net of transaction costs)
$2,850,000
Equity Component of Convertible Note
($272,416)
Interest paid
$9,988
Unwinding of Borrowing Costs and Option Reserve
$336,573
Notes converted
($2,750,000)
Carrying amount of liability component at 30 June 2024
$174,145
The equity component of $272,416 has being credited to the option premium on convertible notes reserve, on
conversion of the convertible notes, $249,714 was recognized in the convertible note reserve was transferred to
share capital.
The interest expensed for the year is calculated by applying an effective interest rate of 20% to the liability
component for the 1 months period since the loans were issued. The liability component is measured at amortised
cost. The difference between the carrying amount of the liability component at the date of issue and the amount
reported in the reporting period at 30 June 2024 represents the effective interest rate less interest paid to that date.
Note 20. Non-Current liabilities – lease liabilities
Consolidated
Lease liability
2024
$
672,718
2023
$
90,697
Refer to note 25 for further information on financial instruments.
Note 21. Non-current liabilities - provisions
Consolidated
2024
2023
$
$
Long service leave
119,679 204,498
IXUP Limited
Notes to the financial statements
30 June 2024
42
Note 22. Equity - issued capital
2024
Consolidated
2023
2024
2023
Shares
Shares
$
$
Ordinary shares - fully paid
1,542,752,593 1,035,492,675 61,778,002
52,355,200
Movements in ordinary share capital
Details
Date
Shares
$
Balance
30 June 2022
902,076,031
47,821,869
Issue of shares
30 September 2022
45,558,882
1,822,355
Issue of shares
20 October 2022
51,000,000
2,040,000
Issue of shares
29 November 2022
24,437,055
977,482
Issue of shares
8 December 2022
6,500,000
260,000
Issue of shares
9 March 2023
5,920,707
148,048
Share issue costs
-
(714,524)
Balance
30 June 2023
1,035,492,675
52,355,200
Issue of shares
11 August 2023
33,333,334
2,000,000
Issue of shares
4 September 2023
12,782,644
766,959
Issue of shares
20 December 2023
3,000,000
374,310
Issue of shares
20 December 2023
2,926,939
146,347
Issue of shares
8 April 2024
144,999,997
2,175,000
Issue of shares
8 April 2024
89,736,673
1,346,050
Issue of shares
16 April 2024
182,146,998
2,732,205
Issue if shares
6 June 2024
38,333,333
575,000
Share issue costs
-
(693,069)
Balance
30 June 2024
1,542,752,593 61,778,002
Options
Details
Date
Options
Balance
30 June 2022
181,174,843
Cancelled due to forfeiture during the year
15 November 2022
(107,289,844)
Issue of plan options to contractors and directors
16 December 2022
156,000,000
Issue of plan options to consultants
2 June 2023
30,000,000
Issue of plan options to consultants
13 June 2023
24,000,000
Options exercised during the year
Balance
30 June 2023
283,884,999
Cancelled due to forfeiture during the year
Various dates
(56,384,999)
Issue of plan options to as part of capital raises
4 September 2024
33,058,032
Issue of plan options to consultants
20 December 2024
3,000,000
Issue of plan options to consultants and Directors
6 June 2024
105,000,000
Balance
30 June 2024
368,558,032
IXUP Limited
Notes to the financial statements
30 June 2024
43
Note 22. Equity - issued capital (Continued)
Performance Rights
Details
Date
Performance
Rights
Balance
30 June 2022
90,405,350
Cancelled due to forfeiture during the year
(11,398,350)
Issue of performance rights to employees
5 October 2021
21,750,000
Balance
30 June 2023
100,757,299
Cancelled due to forfeiture during the year
(3,000,000 )
Balance
30 June 2024
97,757,299
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion
to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company
does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
Capital risk management
The consolidated entity'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 consolidated entity may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The consolidated entity 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 consolidated entity 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.
IXUP Limited
Notes to the financial statements
30 June 2024
44
Note 23. Reserves
Consolidated
2024
2023
$
$
Foreign currency reserve (309,418) (43,781)
Equity-settled reserves
6,480,672
6,480,672
Options reserve
10,898,433 11,782,914
17,069,687
18,219,805
Equity-settled reserve
To determine the fair value of the warrants, the IXUP Group engaged the support of a professional adviser, who estimated
the fair value of the warrants using a widely accepted valuation methodology and assumptions based on historical data for
similar publicly-listed securities.
Options reserve
The reserve is used to recognise the value of equity benefits provided to employees and directors as part of their
remuneration as part of their compensation for services. It is also used to recognise the value of equity benefits issued to
advisors.
Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
Consolidated
Foreign
currency
reserve
$
Equity-settled
reserve
$
Options
reserve
$
Total
$
Balance at 1 July 2022
93,074
6,208,256
9,814,013
16,115,343
Foreign currency translation
(136,855)
-
-
(136,855)
Share based payments
-
-
2,985,527
2,985,527
Options related to Convertible Note
-
272,416
-
272,416
Options Expired - - (1,371,626) (1,371,626)
Share issue costs - Equity
-
-
355,000
355,000
Balance at 30 June 2023
(43,781)
6,480,672
11,782,914
18,219,805
Foreign currency translation
(265,637)
-
-
(265,637)
Share based payments
-
-
2,004,893
2,004,893
Performance rights converted to shares
(374,310)
(374,310)
Share issue costs - Equity
523,787
523,787
Conversion of Convertible note
(249,714)
(249,714)
Options Expired
- -
(2,789,137) (2,789,137)
Balance at 30 June 2024
(309,418) 6,480,672 10,898,433 17,069,687
Consolidated
2024
$
2023
$
Accumulated losses at the beginning of the financial year
(68,590,332)
(43,400,697)
Loss after income tax expense for the year
(10,278,358)
(26,561,261)
Transfer relating to options and rights expired and/or cancelled
2,789,137 1,371,626
Accumulated losses at the end of the financial year
(76,079,553)
(68,590,332)
IXUP Limited
Notes to the financial statements
30 June 2024
45
Note 24. Equity - dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Note 25. Financial instruments
Financial risk management objectives
The Group’s finance function provides services to the business, co-ordinates access to banking facilities, and monitors and
manages the financial risks relating to the operations of the Group in accordance with the decisions of the directors.
In the reporting period, the Group was not exposed to material financial risks of changes in foreign currency exchange rates.
Accordingly, the Group did not employ derivative financial instruments to hedge currency risk exposures.
Consolidated
2024
2023
$
$
Financial assets
Cash and cash equivalents
1,147,951
1,642,869
Other receivables
1,508,041
978,164
2,655,992
2,731,110
Financial liabilities
Trade and other payables
2,269,889
1,625,296
Lease Liabilities
896,088
159,290
3,165,977
1,784,586
Market risk
Interest rate risk
Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market
interest rates. The group's exposure to the risk of changes in market interest rates relates primarily to the group's cash held
on term deposit. A sensitivity analysis was performed and the assessment determined that a movement in interest rates is
not considered to be material to the group's profit and loss.
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 adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral,
where appropriate, as a means of mitigating the risk of financial loss from defaults.
The Group does not have significant credit risk exposure to any single counterparty at the reporting date.
The credit risk on liquid cash funds is limited because the counterparties are banks with high credit-ratings assigned by
international credit-rating agencies. The Group is not exposed to credit risk in relation to financial guarantees given to banks,
because it has no such guarantees outstanding at the reporting date.
IXUP Limited
Notes to the financial statements
30 June 2024
46
Note 25. Financial instruments (Continued)
The consolidated entity 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 consolidated entity based on recent sales experience, historical
collection rates and forward-looking information that is available. The consolidated entity has assessed the expected credit
losses to trade receivables and concluded that no allowance is required.
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
Ultimate responsibility for liquidity risk management rests with the board of directors, which periodically reviews the Group’s
short, medium and long-term funding and liquidity management requirements. The Group manages liquidity risk by
maintaining reserves and banking facilities, by continuously monitoring forecast and actual cash flows, and by matching the
maturity profiles of financial assets and liabilities where possible.
Remaining contractual maturities
The following tables detail the consolidated entity'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 - 2024
Weighted
average
interest rate
%
1 year or less
$
Between 1
and 2 years
$
Between 2
and 5 years
$
Over 5 years
$
Remaining
contractual
maturities
$
Non-derivatives
Non-interest bearing
Trade payables
-
621,822
-
-
-
621,822
Other payables
-
1,648,067
-
-
-
1,648,067
Interest-bearing - variable
Lease liability
10.00%
223,370 223,370 449,348
-
896,088
Total non-derivatives
2,493,259 223,370 449,348
- 3,165,977
Consolidated - 2023
Weighted
average
interest rate
%
1 year or less
$
Between 1
and 2 years
$
Between 2
and 5 years
$
Over 5 years
$
Remaining
contractual
maturities
$
Non-derivatives
Non-interest bearing
Trade payables
-
795,024
-
-
-
795,024
Other payables
-
830,272
-
-
-
830,272
Interest-bearing - variable
Lease liability
10.00%
68,593 72,103 18,595
- 159,291
Total non-derivatives
1,693,890 72,103 18,595
-
1,784,587
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed
above.
Fair value of financial instruments
The directors consider that the carrying amounts of financial assets and financial liabilities recognised in the consolidated
financial statements approximate their fair values.
IXUP Limited
Notes to the financial statements
30 June 2024
47
Note 25. Financial instruments (Continued)
Capital Management
The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximising
the return to stakeholders. The capital structure of the Group consists of net cash (there were no borrowings at year end
offset by cash as detailed in note 9 and equity (detailed in note 22).
As at reporting date, the Group had net assets of $2,768,136 (2023: $1,984,673) and issued capital of $61,778,002 (2023:
$52,355,200).
Note 26. Key management personnel disclosures
Directors
The following persons were directors and KMP's of IXUP Limited during the financial year:
Julian Babarczy
Chairman and Non-Executive Director
Freya Smith
Non-Executive Director
Ian Penrose
Non-Executive Director
Alastair Watson
CEO
Matthew Johnson
CFO
Compensation
The aggregate compensation made to directors and other members of key management personnel of the consolidated entity
is set out below:
Consolidated
2024
2023
$
$
Short-term employee benefits
644,661
844,103
Post-employment benefits
42,910
53,061
Share-based payments
550,000
592,200
1,237,571
1,489,364
Note 27. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by Hall Chadwick WA Audit Pty Ltd,
the auditor of the Company:
Consolidated
2024
2023
$
$
Audit services - Hall Chadwick WA Audit Pty Ltd
Audit or review of the financial statements
35,000
34,000
Note 28. Related party transactions
Parent entity
IXUP Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 32.
Key management personnel
Disclosures relating to key management personnel are set out in note 26 and the remuneration report included in the
directors' report.
IXUP Limited
Notes to the financial statements
30 June 2024
48
Note 28. Related party transactions (Continued)
Transactions with related parties
Mr. Julian Babarczy is one of the ultimate controlling parties of Jigsaw Consulting Pty Ltd.
Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been
eliminated on consolidation and are not disclosed in this note. The following transactions occurred with related parties and
are GST inclusive:
Consolidated
2024
$
2023
$
Payment for goods and services:
Payment to Destria Pty Ltd for consulting services and Director fees
-
90,023
Payment to Jigsaw Consulting Pty Ltd for consulting services
191,667
111,667
Receivable from and payable to related parties
There were no receivables to or from related parties at the current and previous reporting date.
Loans to/from related parties
There were no loans to or from related parties at the current and previous reporting date.
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
Note 29. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Parent
2024
2023
$
$
Loss after income tax
(3,243,722) (19,463,509)
Total comprehensive loss
(3,243,722) (19,463,509)
IXUP Limited
Notes to the financial statements
30 June 2024
49
Note 29. Parent entity information (continued)
Statement of financial position
Parent
2024
2023
$
$
Total current assets
2,443,828 2,069,680
Total non-current assets
1,674,130 1,598,907
Total assets
4,117,958 3,668,587
Total current liabilities
502,958 1,643,765
Total non-current liabilities
846,864 40,148
Total liabilities
1,349,822 1,683,913
Equity
Issued capital
58,840,364
47,759,289
Equity-settled reserves
5,706,263
1,720,129
Options reserve
10,994,323
9,814,014
Accumulated losses
(72,772,814) (57,308,757)
Total equity
2,768,136
1,984,675
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 30 June 2024 and 30 June 2023.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2024 and 30 June 2023.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment as at 30 June 2024 and 30 June 2023.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in note 1, except
for the following:
●
Investments in subsidiaries 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.
Note 30. Business combinations
During the FY23 financial year the company purchased the contract to operate and develop BetStop – The National Self
Exclusion register for $1,325,000. The identification and fair value measurement of the assets and liabilities acquired from
the BetStop acquisition are provisional and amendments may be made to these figures up to 12 months following the date of
acquisition.
Upfront consideration
On completion of the Acquisition, the company made a cash payment to the administrator of $1.325 million.
IXUP Limited
Notes to the financial statements
30 June 2024
50
Note 30. Business combinations (continued)
The acquired business contributed revenues of $6,520,780 to the consolidated entity for the period from 1 July 2023 to 30
June 2024. The values identified in relation to the acquisition of the contract are provisional as at 30 June 2024.
Details of the acquisition are as follows:
Fair value
$
Assets
Contracts: National Self Exclusion Register Agreement
1,344,565
Prepayments
27,976
Liabilities
Deferred Tax Liability
(336,141)
Employee Leave
(117,688)
Acquisition-date fair value of the total consideration transferred
918,712
Representing:
Acquisition-date fair value of total consideration transferred
$918,712
Goodwill
$406,208
Net cash used to acquire business
$1,325,000
The identification and fair value measurement of the assets and liabilities acquired from the BetStop acquisition are
provisional and amendments may be made to these figures up to 12 months following the date of acquisition.
Note 31. Fair value measurement
Fair value hierarchy
The contingent consideration payable on meeting the £2,000,000 revenue target referred to in note 14 has been reported as
a financial liability as it will be paid through the issue of a variable number of shares amounting to a maximum of $1,875,000
and a bonus of $500,000.
This financial liability is measured at fair value by applying management’s assessment of the probability of the revenue target
being met to maximum fair value payable. and therefore, the fair value is deemed to be a level 3 valuation under AASB 13
Fair Value as it is based on unobservable inputs. Change in fair value arising from changes in management’s assessment
of the likelihood of the target being met are recognised in profit and loss. Changes in management’s assessment of the
likelihood of the targets being met would change the fair value of the consideration payable in accordance with the terms
summarised in Note 14.
Note 32. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following wholly-owned subsidiaries
in accordance with the accounting policy described in note 1:
Parent
Ownership
interest
Ownership
interest
Principal place of business /
2024
2023
Name
Principal activities
Country of incorporation
%
%
IXUP Operations Pty Ltd
Software development
Australia
100%
100%
IXUP IP Pty Ltd
Software patents
Australia
100%
100%
DataPOWA Ltd
Software development
UK
100%
100%
IXUP INC
Software development
US
100%
100%
IXUP Limited
Notes to the financial statements
30 June 2024
51
Note 33. Events after the reporting period
On the 2 of August 2024, the Company announced it had been awarded a A$10 million online gambling self
exclusion contract in Ontario, Canada.
IXUP has entered the North American market having secured in conjunction with its North American partner IC360, a
strategically important contract to provide the self-exclusion register for the Province of Ontario, Canada’s largest gambling
market. The contract has a total estimated contract value of over A$10 million over an initial 5-year contract term with a
further three, one year contract extensions.
On the 26th of August, the Company announced confirmed the initial deployment of its core technology. IXUP expected to
deploy its Secure Data Engine and 5-Safes government framework, delivered via Microsoft Azure, to power the Western
Australian Government funded Shared Environmental Analytics Facility (SEAF). The company has signed a multi-year
contract with The Western Australian Biodiversity Science Institute (WABSI) and the project partners include Microsoft, Rio
Tinto, BHP Billiton and various Western Australian Government organisations.
On the 26th of September, the Company announced it had firm commitments for $1.85m via a share placement, which is
expected to settle on the 3rd October 2024. Participants will receive one free attaching unlisted option for every 2 shares
subscribed and the proceeds will be used to enhance IXUP’s sales pipeline and advance sales conversion activities as well
as facilitate ongoing business transformation.
Note 34. Reconciliation of loss after income tax to net cash used in operating activities
Consolidated
2024
$
2023
$
Loss after income tax expense for the year
(10,278,358)
(26,698,116)
Adjustments for:
Depreciation and amortisation
1,907,546
1,070,307
Share-based payments
2,004,893
2,985,526
Goodwill amortisation
-
13,597,624
Finance Cost
380,484
-
Change in operating assets and liabilities:
(Increase)/decrease in other receivables and other assets
(529,502)
(1,076,222)
Increase in trade and other payables
496,450
569,579
(Decrease)/Increase in provisions
(240,909)
119,187
Net cash used in operating activities
(6,259,396) (9,432,115)
IXUP Limited
Notes to the financial statements
30 June 2024
52
Note 35. Non-cash investing and financing activities
During the current year, the Group entered into the following non-cash investing and financing activities, which are not
reflected in the consolidated statement of cash flows:
During the year ended 30 June 2024, the Group entered into the following non-cash investing and financing activities, which
are not reflected in the consolidated statement of cash flows:
(i) The Company issued 60,000,000 Unlisted Options to Cygnet Capital as part of their fees for providing underwriting and
offer management services.(ii) The Company issued 3,000,000 Unlisted Options to Advisors as part of their fees for
professional services.
During the year ended 30 June 2023, the Group entered into the following non-cash investing and financing activities, which
are not reflected in the consolidated statement of cash flows:
(ii) The Company issued 25,000,000 Unlisted Options to Cygnet Capital as part of their fees for providing underwriting and
offer management services.(ii) The Company issued 3,000,000 Unlisted Options to Advisors as part of their fees for
professional services.
Note 36. Earnings per share
Consolidated
2024
2023
$
$
Loss after income tax attributable to the shareholders of IXUP Limited
(10,278,358)
(26,561,261)
Cents
Cents
Basic earnings per share
(0.87)
(2.68)
Diluted earnings per share
(0.87)
(2.68)
Number
Number
Weighted average number of ordinary shares used in calculating basic earnings per share
1,176,275,178
998,462,422
Weighted average number of ordinary shares used in calculating diluted earnings per share 1,176,275,178
998,462,422
Non-Dilutive Securities
As at reporting date, 368,558,032 Unlisted Options (which represent 368,558,032 potential Ordinary Shares) were considered
non-dilutive as they would decrease the loss per share
IXUP Limited
Notes to the financial statements
30 June 2024
53
Note 37. Share-based payments and Performance Rights
Shares under option
Unissued ordinary shares of IXUP under option at the date of this report are as follows:
Grant date
Expiry date
Exercise
price
Number
under option
29 January 2021
03 February 2025
$0.10
40,000,000
16 December 2022
16 December 2024
$0.06
156,000,000
2 June 2023
30 June 2026
$0.06
7,500,000
13 June 2023
30 June 2026
$0.06
24,000,000
4 September 2023
4 September 2025
$0.10
33,058,032
20 December 2023
20 December 2025
$0.08
3,000,000
6 June 2024
31 May 2027
$0.03
105,000,000
368,558,032
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 under performance rights
Unissued ordinary shares of IXUP under performance rights at the date of this report are as follows:
Grant date
Expiry date
Exercise
price
Number
under rights
5 October 2021
31 March 2025
$0.00
11,000,000
9 December 2021
31 December 2024
$0.00
50,000,000
3 February 2023
3 February 2026
$0.00
36,757,299
97,757,299
No person entitled to exercise the performance rights had or has any right by virtue of the performance right to participate in
any share issue of the Company or of any other body corporate.
A summary of the Company options and performance rights issued in the financial year is as follows:
Class of SBP
Quantity
Share price at
Grant date
Value recognized
during the year
Value to be
recognized in
future years
Julian Babarczy
Unlisted Options
25,000,000
$0.03
$158,485
-
Ian Penrose
Unlisted Options
25,000,000
$0.03
$158,485
-
Freya Smith
Unlisted Options
5,000,000
$0.03
$31,697
-
Cygnet Capital
Unlisted Options
50,000,000
$0.03
$316,970
-
Cygnet Capital
Unlisted Options
10,000,000
$0.10
$206,817
-
Consultants
Unlisted Options
3,000,000
$0.08
$64,163
Staff EIP
Performance Rights
20,757,299
$0.030
$418,995
$662,933
Previous Years
Vesting of SBP
-
Forfeiture/Lapse of SBP
-
Total SBP for the year
$2,913,043
Share issue costs
recognized as capital
raising cost
($942,782)
Share-base payments recognized in the profit and loss
$2,004,893
IXUP Limited
Notes to the financial statements
30 June 2024
54
Note 37. Share-based payments and Performance Rights (Cont.)
The fair value of the options and performance rights over ordinary shares granted to Executives, Directors and Consultants have
been valued using a Black-Methodology:
Options Issued 4
September 2023
Options
issued
20
December
2023
Options issued 31
May 2024
Exercise Price
$0.10
$0.08
$0.03
Grant Price
$0.046
$0.035
$0.015
Grant Date
16/12/22
20/12/23
31/5/24
Volatility
90%
90%
90%
Model Used
Black-Scholes
Black-Scholes
Black-Scholes
Expiry
4/9/25
20/12/25
31/5/27
Risk free interest rate
4.042%
4.348%
4.328%
Vesting period
-
-
-
Number of Options
10,000,000
3,000,000
105,000,000
Total Value
$206,817
$64,163
$950,000
Value recognized
during the period
$206,817
$64,163
$950,000
A summary of the Company options and performance rights issued in the previous financial year is as follows:
Class of SBP
Quantity
Share price at
Grant date
Value recognized
during the year
Value to be
recognized in
future years
Cygnet Capital
Unlisted Options
25,000,000
$0.155
$177,500
$288,437
Ian Penrose
Performance Rights
11,000,000
$0.21
-
-
Advisors
Performance Rights
50,000,000
$0.14
$744,811
$1,967,639
$922,311
$2,256,076
The fair value of the options over ordinary shares granted to Executives, Directors and Consultants have been valued using a
Black-Methodology:
Options Issued 2
August 2021
Exercise Price
$0.02
Grant Price
$0.20
Grant Date
2/8/21
Volatility
95%
Model Used
Black-Scholes
Expiry
2/8/23
Risk free interest rate
2.00%
Vesting period
-
Number of Options
25,000,000
Total Value of options
$1,717,736
Value recognized
during the period
$858,868
IXUP Limited
Notes to the financial statements
30 June 2024
55
Note 37. Share-based payments and Performance Rights (Cont.)
Set out below are summaries of performance rights movements during the year:
2024
Grant date
Expiry date
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
29/01/2021
03/02/2026
16,000,000
-
-
-
16,000,000
13/09/2021
31/12/2023
3,000,000
-
-
(3,000,000)
-
05/10/2021
31/03/2025
11,000,000
-
-
-
11,000,000
09/12/2021
31/12/2024
50,000,000
-
-
-
50,000,000
03/02/2023
03/02/2026
20,757,299 - - - 20,757,299
100,757,299
-
-
(3,000,000)
97,757,299
2023
Grant date
Expiry date
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
20/12/2018
14/11/2022
2,000,000
-
-
(2,000,000)
-
02/07/2019
14/11/2022
5,250,000
-
-
(5,250,000)
-
29/01/2021
03/02/2026
16,000,000
-
-
-
16,000,000
13/09/2021
31/12/2023
3,000,000
-
-
-
3,000,000
05/10/2021
31/03/2025
11,000,000
-
-
-
11,000,000
09/12/2021
31/12/2024
50,000,000
-
-
-
50,000,000
21/12/2021
20/12/2024
3,155,649
-
- (3,155,649)
-
03/02/2023
03/02/2026
- 21,750,000 - (992,701) 20,757,299
90,405,649
21,750,000
- (11,398,350)
100,757,299
The weighted average remaining contractual life of performance rights outstanding at the end of the financial year was 1.5
years (2023; 2.5 years)
For the performance rights granted or vesting 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
Share price
at grant date
Vesting T1
Probability of
Vesting T2
Vesting T3
Risk-free
interest rate
Fair value
at grant date
13/09/2021
31/12/2023
$0.14
50.00%
-
-
2%
$0.1248
05/10/2021
31/03/2025
$0.21
40.00%
25.00%
15.00%
2%
$0.1928
09/12/2021
31/12/2024
$0.14
40.00%
25.00%
-
2%
$0.0000
21/12/2021
20/12/2024
$0.14
50.00%
-
-
2%
$0.1048
03/02/2023
03/02/2026
$0.05
50.00%
-
-
4%
$0.1248
The performance rights have the following vesting conditions with a grant date of 13/09/2021.
T1 – upon introduction by the recipient and subsequent completion of one or more transactions that add an aggregate of at
least A$2.0m in revenue to the IXUP Group of companies in a Measurement Period
T2 – The volume weight average price (VWAP) at which IXUP shares trade on the ASX during the rolling period of 20
continuous trading days meets or exceeds a level which is 33% higher than the closing price for IXUP shares on the ASX as
at the grant date and the board determines, in its discretion, that the recipient material contributed to such increase.
The performance rights have the following vesting conditions with a grant date of 05/10/2021.
T1 – 2.5m Rights vest upon the introduction and completion of 1 or more transactions that add an aggregate of at least
A$2.5m in revenue to the Group in any measurement Period.
T2 - 2.5m Rights vest upon the introduction and completion of 1 or more transactions that add an aggregate of at least
A$6.5m in revenue to the Group in any measurement Period.
T3 – a) the VWAP of IXUP shares trading on ASX during any rolling period 20 continuous trading days meets or exceeds a
level which is 33% higher than the closing price for the IXUP shares at the grant date; b) the group achieves revenue of at
least A$5m in any Measurement Period; c) the recipient has been engaged by the group for a continuous period of 3 yrs.
IXUP Limited
Notes to the financial statements
30 June 2024
56
Note 37. Share-based payments and Performance Rights (Cont.)
The performance rights have the following vesting conditions with a grant date of 09/12/2021.
T1 – 25m will vest upon introduction by the recipient and completion of one or more transactions that add an aggregate of
at least A$5m in revenue to the Group in any Measurement period
T2 - 25m will vest upon introduction by the recipient and completion of one or more transactions that add an aggregate of at
least A$10m in revenue to the Group in any Measurement period
The performance rights have the following vesting conditions with a grant date of 21/12/2021.
T1 – a) Continuous service; b) 20-day volume weighted average price (VWAP) of IXUP’s shares meeting or exceeding a
level which is 30% higher than the closing price for IXUP shares at the grant date and the Board determines, in its discretion
that the recipient contributed to such increase.
The performance rights have the following vesting conditions with a grant date of 03/02/2023.
T1 – Measured up to Year 3, a) Signed commercial revenue generating contracts; b) Revenue targets c) Successful US
Pilot and d) Individual KPI’s
Note 38. Consolidated Entity Disclosure Statement
Consolidate entity disclosure statement:
Name of Entity
Type of Entity
Trustee,
partner or
participant in
joint venture
% of share
capital held
Country of
incorporation
Australian
resident or
Foreign
resident
Foreign tax
jurisdiction(s)
of foreign
resident
IXUP Limited
Body
Corporate
-
N/A
Australia
Australian
N/A
IXUP
Operations Pty
Ltd
Body
Corporate
-
100%
Australia
Australian
N/A
IXUP IP Pty Ltd
Body
Corporate
-
100%
Australia
Australian
N/A
DataPOWA Ltd
Body
Corporate
-
100%
United
Kingdom
Foreign
United
Kingdom
IXUP Inc.
Body
Corporate
-
100%
United States
of America
Foreign
United States
of America
IXUP Limited
Notes to the financial
statements
57
In the directors' opinion:
●
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional reporting requirements;
●
the attached financial statements and notes comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board as described in note 1 to the financial statements;
●
the attached financial statements and notes give a true and fair view of the consolidated entity's financial position as at
30 June 2024 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 consolidated entity disclosure on page 56 is true and correct as at 30 June 2024.
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
Julian Babarczy
Chairman
30 September 2024
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF IXUP LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of IXUP Limited (“the Company”) and its subsidiaries (“the Consolidated
Entity”), which comprises the consolidated statement of financial position as at 30 June 2024, the consolidated
statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity
and the consolidated statement of cash flows for the year then ended, and notes to the financial statements,
including material accounting policy information, the consolidated entity disclosure statement and the
director’s declaration.
In our opinion:
a.
the accompanying financial report of the Consolidated Entity is in accordance with the Corporations Act
2001, including:
(i)
giving a true and fair view of the Consolidated Entity’s financial position as at 30 June 2024 and
of its financial performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
b.
the financial report also complies with International Financial Reporting Standards as disclosed in Note
1.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section
of our report. We are independent of the Consolidated Entity in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and
Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant
to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in
accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Material Uncertainty Related to Going Concern
We draw attention to Note 1 in the financial report which indicates that the Consolidated Entity incurred a net
loss of $10,278,358 during the year ended 30 June 2024. As stated in Note 1, these events or conditions,
along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast
significant doubt on the Consolidated Entity’s ability to continue as a going concern. Our opinion is not modified
in this respect of this matter.
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.
Key Audit Matter
How our audit addressed the Key Audit Matter
Accounting for share based payments
As disclosed in note 37 to the financial
statements, during the period ended 30 June
2024 the Group incurred share based payments
of $2,004,893.
Share based payments are considered to be a
key audit matter due to
•
the value of the transactions;
•
the
complexities
involved
in
the
recognition and measurement of these
instruments; and
•
the judgement involved in determining
the inputs used in the valuations.
Management used the Black-Scholes option
valuation model to determine the fair value of the
options granted. This process involved significant
estimation and judgement required to determine
the fair value of the equity instruments granted.
Our procedures amongst others included:
•
Analysing agreements to identify the key terms
and conditions of share based payments issued
and relevant vesting conditions in accordance
with AASB 2 Share Based Payments;
•
Evaluating
management’s
Black-Scholes
Valuation
Models
and
assessing
the
assumptions and inputs used;
•
Assessing the amount recognised during the
period in accordance with the vesting conditions
of the agreements; and
•
Assessing the adequacy of the disclosures
included in Note 37 to the financial statements.
Revenue Recognition
During the year ended 30 June 2024, the
Consolidated Entity generated sales revenue of
$6,630,857 (2023: $1,256,161).
As part of our audit procedures, the following audit
procedures were performed:
•
Analysing agreements to identify the key terms
and conditions of sale;
• Evaluated the substance of the sale using the
Key Audit Matter
How our audit addressed the Key Audit Matter
Revenue recognition has been included as a key
focus area in the audit report due to its financial
significance and the increase in revenue during
the year.
terms and conditions of the underlying
transaction agreements;
• Assessed revenue recognition in accordance
with AASB 15 Revenue from Contracts with
Customers to ensure revenue was recognised
in the correct accounting period;
• Verify cash consideration to bank statements;
• Assessing the adequacy of the disclosures
included in notes 4 to the financial statements.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Consolidated Entity’s annual report for the year ended 30 June 2024, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error, and the
consolidated entity disclosure statement that is true and correct and is free of misstatement, whether due to
fraud or error. In Note 1, the directors also state in accordance with Australian Accounting Standard AASB 101
Presentation of Financial Statements, that the financial report complies with International Financial Reporting
Standards.
In preparing the financial report, the directors are responsible for assessing the Consolidated Entity’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Consolidated Entity or to cease
operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of this
financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement
and maintain professional skepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
•
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Consolidated Entity’s internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
•
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Consolidated Entity’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate,
to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Consolidated Entity to cease to
continue as a going concern.
•
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events in a
manner that achieves fair presentation.
•
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Consolidated Entity to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Consolidated Entity audit. We remain
solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2024.
The directors of the Company are responsible for the preparation and presentation of the remuneration report
in accordance with s 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.
Auditor’s Opinion
In our opinion, the Remuneration Report of IXUP Limited, for the year ended 30 June 2024, complies with
section 300A of the Corporations Act 2001.
HALL CHADWICK WA AUDIT PTY LTD
MARK DELAURENTIS CA
Director
Dated this 30th day of September 2024
Perth, Western Australia
IXUP Limited
Shareholder Information
30 June 2024
63
The shareholder information set out below was applicable as at 27 September 2024.
There is one class of quoted securities, fully paid ordinary shares.
Distribution of Equitable Securities
Analysis of number of equitable security holders by size of holding:
Fully Paid Ordinary Shares
Ordinary shares
Ordinary Shares
Ordinary shares
Number
Number
% Issued
of holders
of units
Share Capital
1 to 1,000
50
14,356
0.00%
1,001 to 5,000
155
512,418
0.03%
5,001 to 10,000
132
1,079,102
0.07%
10,001 to 100,000
433
17,238,614
1.11%
100,001 and over
504
1,528,908,103
98.78%
1,274
1,547,752,593
100.00%
Marketable Parcel
There are 573 shareholders with less than a marketable parcel (basis price of $0.015) as at 27 September 2024.
On-Market Buy-Back
There is no on-market buy-back scheme in operation for the Company’s quoted shares.
Unlisted Options
Unlisted
Options
Unlisted Options
Unlisted Options
Number
Number
% Issued
of holders
of units
Share Capital
Unlisted Options at $0.06, exp 16/12/24
100,001 and over
11
156,000,000
100.00%
Unlisted Options at $0.10, exp 03/02/25
100,001 and over
1
40,000,000
100.00%
Unlisted Options at $0.10, exp 04/09/25
1 to 1,000
50
15,708
0.05%
1,001 to 5,000
31
70,441
0.21%
5,001 to 10,000
12
79,775
0.24%
10,001 to 100,000
36
1,556,322
4.71%
100,001 and over
42
31,335,786
94.79%
Unlisted Options at $0.06, exp 30/06/25
100,001 and over
4
24,000,000
100.00%
Unlisted Options at $0.08, exp
20/12/2025
100,001 and over
2
3,000,000
100.00%
Unlisted Options at $0.06, exp 30/06/26
100,001 and over
1
7,500,000
100.00%
Unlisted Options at $0.03, exp 31/05/27
100,001 and over
19
105,000,000
100.00%
IXUP Limited
Shareholder Information
30 June 2024
64
Unlisted Options at $0.03, exp
31/05/2027 (Employee Options issued
under the Employee Incentive Plan)
100,001 and over
6
27,000,000
100.00%
Performance Rights
Performance
Rights
Performance
Rights
Performance Rights
Number
Number
% Issued
of holders
of units
Share Capital
Performance Rights (Employee
Performance Rights issued under
the Employee Incentive Plan)
5,001 to 10,000
1
7,299
0.01%
100,001 and over
16
70,886,737
99.99%
Performance Rights
100,001 and over
1
50,000,000
100.00%
Convertible Notes
Convertible Notes
Convertible Notes
Convertible Notes
Number
Number
% Issued
of holders
of units
Share Capital
100,001 and over
1
250,000
100.00%
Equity Security Holders
Twenty Largest Quoted Equity Security Holders
The names of the twenty largest security holders of quoted equity securities are listed below:
Ordinary shares
% of
total
shares
Number held
issued
DECK CHAIR HOLDINGS PTY LTD
166,333,333
10.75%
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
132,194,626
8.54%
DREAVER INVESTMENTS AUSTRALIA PTY LIMITED
90,805,257
5.87%
VISTA GROVE INVESTMENTS PTY LTD
89,786,174
5.80%
KEA HOLDINGS PTY LTD
69,998,440
4.52%
HOLDREY PTY LTD
45,486,172
2.94%
CITICORP NOMINEES PTY LIMITED
35,691,496
2.31%
JOSCELYNE INVESTMENTS PTY LTD
31,193,302
2.02%
FNL INVESTMENTS PTY LTD
30,700,000
1.98%
KOLLEY PTY LTD
23,625,000
1.53%
KEMBLA NO 20 PTY LTD
21,202,956
1.37%
MR PAUL ALEXANDER MCKAY ABERDEEN
17,916,666
1.16%
HOLDREY PTY LTD
16,666,666
1.08%
WALSAL NOMINEES PTY LTD
16,666,666
1.08%
PJP GROUP PTY LTD
16,093,750
1.04%
FNL INVESTMENTS PTY LTD
16,000,000
1.03%
RACCOLTO INVESTMENTS PTY LTD
15,850,004
1.02%
IXUP Limited
Shareholder Information
30 June 2024
65
MR FARIS CASSIM
15,651,396
1,01%
PLATINUM HOLDINGS PTY LTD
14,443,798
0.93%
DIGITAL INVESTMENTS PTY LTD
14,300,000
0.92%
Totals
897,417,945
57.98%
Total Issued Capital
1,547,752,593
100.00%
Unquoted Equity Securities – Unlisted Options
Holders of 20% or more of Unlisted Options on issue
Unlisted
Options
Unlisted Options
Number
% Issued
of units
Share Capital
Unlisted Options at $0.10, exp 03/02/25
TEKKORP CAPITAL LLC
40,000,000
100.00%
Unlisted Options at $0.06, exp 16/12/24
WHITE SWAN NOMINEES PTY LTD
50,000,000
32.05%
TEKKORP CAPITAL LLC
40,000,000
25.64%
Unlisted Options at $0.03, exp 31/05/2027
VAUCLUSE INVESTMENT HOLDINGS P/L
25,000,000
23.81%
IAN PENROSE
25,000,000
23.81%
CYGNET CAPITAL PTY LTD
23,887,000
22.75%
Unquoted Equity Securities – Performance Rights
Holders of 20% or more of Performance Rights on issue
Performance
Rights
Performance
Rights
Number
% Issued
of units
Share Capital
TEKKORP CAPITAL LLC
50,000,000
100.00%
Unquoted Equity Securities – Convertible Notes
Holders of 20% or more of Convertible Notes on issue
Convertible
Notes
Convertible
Notes
Number
% Issued
of units
Share Capital
DEAGUE CAPITAL PTY LTD
250,000
100.00%
IXUP Limited
Shareholder Information
30 June 2024
66
Substantial holders
Substantial holders in the Company are set out below:
Ordinary Shares
% of total
Date of
shares
ASX notice
Number held
issued
JAGGER HOLDINGS PTY LTD
166,333,333
10.78%
07/06/24
JONATHAN SAUL ROSHAM
159,784,614
10.32%
26/06/23
RANSDALE INVESTMENTS PTY LTD
52,500,000
8.81%
20/10/20
DREAVER INVESTMENTS AUSTRALIA PTY LTD;
DREAVER HOLDINGS AUSTRALIA PTY LTD
90,805,257
6.04%
16/04/24
SG HISCOCK & COMPANY LIMITED
79,843,290
5.16%
13/08/2024
Note: Ransdale Investments Pty Ltd lodged a Form 603 on 20 October 2020, in which it disclosed a relevant interest in 52,500,000
Shares (8.81% Voting Power). The Company notes that Ransdale is no longer listed as a shareholder on the Company's share register.
Restricted Securities
There are no restricted securities on issue.
There are no other classes of equity securities.
Voting Rights
Fully Paid Ordinary Shares
There are 1,274 holders of ordinary shares. On a show of hands every member present at a meeting in person or by proxy will have one
vote and upon a poll each share shall have one vote.
Unlisted Options
There are no voting rights attached to Unlisted Options.
Performance Rights
There are no voting rights attached to Performance Rights.
Convertible Notes
There are no voting rights attached to Convertible Notes.
Corporate Governance
The Company’s Corporate Governance Statement as at 30 June 2024 as approved by the Board can be viewed at
https://investors.ixup.com/investor-centre/?page=corporate-governance
Stock Exchange on which the Company’s Securities are Quoted
The Company’s listed equity securities are quotes on the Australian Securities Exchange
Review of Operations
A review of operations is contained in the Directors Report.
Annual General Meeting
The Company advises that the Annual General Meeting ('AGM') of the company is scheduled for 25 November 2024.
Further to Listing Rule 3.13.1, Listing Rule 14.3 and clause 6.2(f) of the Company's Constitution, nominations for election of directors at
the AGM must be received not less than 35 Business Days before the meeting, being no later than Monday, 7 October 2024.