2019 ANNUAL REPORT
Jaxsta Limited (formerly known as Mobilarm Limited)
ABN 15 106 513 580
Table of Contents
2019 FY Milestones
Jaxsta By the Numbers
Chairman’s Letter
Chief Executive Officer & Chief Information Officer’s Letter
Directors’ Report
Remuneration Report
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors’ Declaration
Auditors’ Independence Declaration
Independent Auditor’s Report
Additional Shareholder Information
Corporate Directory
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3
6
7
9
16
25
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28
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Credit where credit is due
Photo credit: Kobe Subramaniam
2019 FY Milestones
28th December 2018
12th March 2019
5th May 2019
17th June 2019
Jaxsta re-lists on the Australian
Securities Exchange.
Jaxsta signs Universal Music Group as a data
partner to supply official music data and
credits for Jaxsta’s platform.
Jaxsta continues music industry
engagement with presence at leading
industry event Music Biz in Nashville.
Jaxsta attends industry conference Indie Week
in New York to promote the launch of Jaxsta
Beta to music industry professionals.
6th February 2019
15th March 2019
13th June 2019
24th June 2019
Jaxsta attended the GRAMMY Awards®
Week to showcase previews of Jaxsta
Beta to an exclusive group of music
industry professionals.
Jaxsta signs Warner Music Group as a data
partner, completing the final of the ‘big three’
global record labels as official partners.
Jaxsta Beta launched and is accessible
to the public on jaxsta.com.
Jaxsta signs Merlin as Data Partner. Jaxsta
now holds 30 data licensing agreements
covering approximately 90 per cent
of the popular music industry1.
Photo credit: Nicholas Green
¹ As calculated according to the distributor’s estimated individual market share by number of streams as quoted to Jaxsta by our data partners.
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2
Jaxsta By The Numbers
100,000,000+
Individual music credits on Jaxsta
2,123
Tim Tams our team have shared with the Music Industry
30,000,000+
Pages on Jaxsta
2015
Year Jaxsta was founded by Jacqui Louez Schoorl and Louis Schoorl
22,000,000+
Unique recordings (i.e. songs)
2006
Year Jaxsta Startup idea conceived
6,000,000+
Individual profiles
2,300,000+
Songwriter profiles
1,800,000+
Artist profiles (e.g. band, solo artist or feature performer)
1,000,000+
Guitar credits
500,000+
Drum credits
250,000+
Producer profiles
175,000+
Engineer profiles
49,000+
Songs with ‘Summer” in the title
8,000+
Recordings of ‘Silent Night’
5,000+
Recordings of “Amazing Grace”
3,800+
Presentations Team Jaxsta have delivered to the Music Industry
NOTE: By the time you read this, thousands more credits would have been ingested into Jaxsta.
1,500+
Bagpipe credits
1,000+
Triangle credits
800
223
100
61
30
19
3
1
1
Merlin members representing 10,000+ labels from 63 countries
Countries/Territories Jaxsta receives website traffic
Percent of the ‘Big 3’ major labels (Sony, Universal & Warner) providing credits to Jaxsta
Years of GRAMMY nominee and winner data on Jaxsta
Jaxsta Data Partners, representing 100’s thousands of labels
Years it would take to review all pages on Jaxsta (20 sec per page)
Continents where Jaxsta Team are based (U.S. Europe, Australia)
Performance Rights Organisation (PRO) signed. APRA AMCOS the first to sign with Jaxsta
There’s only one leading database for official music credits – Jaxsta!
Photo credit: Boga Rin
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Chairmans’ Letter
Dear Shareholder,
On behalf of the Board, it is a pleasure to present Jaxsta’s first annual report following the completion
of the reverse takeover transaction in December 2018 and re-listing on the ASX. I am pleased to share
the strong progress we have made during 2019.
Jaxsta’s vision has always been to tell the story behind the music and give credit where credit is due for
millions of artists, songwriters, producers and music makers. We are pleased to report that since re-listing
less than 12 months ago, we have turned our vision into reality by launching the beta version of our core
product offering (Jaxsta Beta), which is now live on Jaxsta.com. This is a major milestone for the Company
and introduces our core product offering to the public.
Leading up to Jaxsta Beta’s launch, in addition to the existing data partnership with Sony Music
Entertainment, the Company established additional data partnerships with major record labels to ingest
their data into the platform. This included entering into data licensing agreements with Universal Music
Group (Universal) and Warner Music Group (Warner) – two of the biggest record labels in the world –
and with Music and Entertainment Rights Licensing Independent Network (Merlin), the global rights
agency for the world’s independent label sector.
As of the end of July 2019, Jaxsta had secured 30 data licensing agreements which represent
approximately 90 per cent of the global recorded music industry. Many of our data partners also have
an equity stake in Jaxsta, highlighting their support of our vision and mission.
Jaxsta’s strong momentum in securing numerous data licensing agreements is a testament of our strong
alignment with the music industry and its key players. Ultimately, Jaxsta is a music company operating in
the technology space, and relationships have always played a critical role in the music industry. We place
a strong emphasis on our partnerships and we thank all our partners for their continued support of Jaxsta.
On behalf of the Board, I’d like to take this opportunity to thank CEO and Co-founder Jacqui Louez Schoorl
and the entire Jaxsta team for their outstanding efforts and dedication. We acknowledge the hardworking
team behind the negotiations that led us to secure data partnerships with some of the world’s biggest
record labels.
I would like to thank my fellow Board members for their contribution this year, and thank our shareholders
for their continued support. We do not take this for granted.
We look forward to another exciting year ahead as Jaxsta prepares for the launch of our business-to-
business paid subscription product which targets the music industry and associated professionals
(Jaxsta Pro). The launch of Jaxsta Pro is expected before the end of the 2019 calendar year.
Yours Sincerely,
Brett Cottle AM
Independent, non-Executive Chairman
Official music credits
Photo credit: Greyson Joralemon
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1 As calculated according to the distributor’s estimated individual market share by number of streams as quoted to Jaxsta by our data partners
Image of Brett Cottle by Cybele Malinowski
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Chief Executive Officer & Chief Information
Officer’s Report
We are pleased to report Jaxsta’s many achievements and
significant milestones over the past year. It has been a truly
transformative year for the Company – not only did it become
a publicly listed entity by way of a successful reverse-
takeover, but we also launched Jaxsta Beta, now live
on jaxsta.com.
These events included the GRAMMY® Producer and
Engineers Wing event in Los Angeles, the 61st GRAMMY®
Awards, SXSW Conference in Austin Texas, Music Biz in
Nashville, A2IM Indie Week in New York, APRA AMCOS Music
Awards in Melbourne, AIM Connected in London and Indie-
Con and the AIR Awards in South Australia.
There is currently no public facing official central database
of music credits and liner notes. Jaxsta is well positioned
to satisfy this unmet need for music industry professionals,
artists, creators as well as music enthusiasts alike.
Launch of Jaxsta Beta
The launch of Jaxsta Beta was a significant milestone for the
Company and we are pleased to have achieved this in line
with the business model outlined in our Prospectus dated
28 September 2018. The platform is positioned to be the
world’s first dedicated database of official music credits.
To date, it holds over 100 million individual credits across
more than 30 million pages which are updated daily to reflect
the latest information from our data partners. Developing this
bespoke product from the ground up and entirely in-house,
using cutting-edge and innovative solutions, was a significant
technical achievement.
Feedback from users who tested Jaxsta Beta (both pre- and
post-launch) has been positive and encouraging. We continue
to improve the platform to enhance the user experience and
are using this feedback to inform and refine our core product
as we prepare for the launch of Jaxsta Pro, which is expected
before the end of calendar year 2019.
Major data licensing partnerships signed
Since signing the data licensing agreements with Universal,
Warner and Merlin, we have been processing each
organisation’s data and music credits for ingestion into
our platform.
These data partnerships are a result of our strong
relationships with the music industry and a testament to the
buy-in we have from industry players. The willingness of our
partners to enter into these arrangements underscores the
need for a product like Jaxsta Beta and Jaxsta Pro. We look
forward to formalising additional data partnerships in the
next year and increasing the scope of official music data
and credits available on the platform.
Sales and Marketing activities
During the year, Jaxsta’s representatives attended major music
industry conferences and gatherings to promote the launch
of Jaxsta Beta.
Photo credit: Hollie Adams
7
Industry feedback relating to Jaxsta Beta has been positive
and we are pleased to report encouraging initial user
engagement on Jaxsta.com. In preparation of the launch
of Jaxsta Pro, we enhanced our sales and marketing
capabilities through strategic hires and we continue to raise
the profile of Jaxsta through existing and new channels.
Jaxsta Pro Launch Update
We are currently preparing for the launch of Jaxsta Pro
which will be a significant milestone for the Company with
subscription fees to be received from Jaxsta Pro users
establishing the Company’s first revenue stream.
As part of the Jaxsta Pro launch, our development team are
refining the platform features in response to testing and user
acceptance of Jaxsta Beta. Simultaneously, our marketing
team is currently preparing for the pending launch and we
look forward to updating shareholders on developments
on this front.
Future Outlook
We would like to take this opportunity to thank Jaxsta’s
executive team and all the staff for their outstanding efforts
this past year. 2019 was a transformative year for the
Company and our recent successes have been the culmination
of years of hard work and dedication.
In the year ahead, we expect to launch Jaxsta Pro, formalise
more data partnerships and continue to improve the platform
to introduce new features and capabilities.
As we look ahead, we are committed to our vision: to tell the
story behind the music and give credit where credit is due for
millions of artists, songwriters, producers and music makers.
We thank all our shareholders and remain committed to
building greater shareholder value in the year ahead.
Jacqui Louez Schoorl
Chief Executive Officer
& Co-Founder
Phil Morgan
Chief Information Officer
Image of Jacqui Louez Schoorl and Phil Morgan
Photo credit: Hollie Adams
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Jaxsta Limited
2019 Annual Report | Directors’ Report
Jaxsta Limited
2019 Annual Report | Director’s Report
Directors’ Report
The Directors present their report on the consolidated entity (referred to hereafter as the ‘Group’)
consisting of Jaxsta Limited (referred to hereafter as the ‘company’ or ‘parent entity’) and the
entities it controlled at the end of, or during, the year ended 30 June 2019 (the ‘Directors’ Report’).
The Directors’ Report together with the Financial Statements commencing on page 25 constitute
Jaxsta’s 2019 Annual Report (the ‘Report’).
Directors
The following persons were Directors of Jaxsta during the whole of the financial year and up to the
date of this Report, unless otherwise stated:
•
•
•
•
•
•
•
Brett Cottle (Non-Executive Chairman) - appointed on 28 December 2018;
Jacqueline Louez Schoorl (Executive) - appointed on 28 December 2018;
Linda Jenkinson (Non-Executive) - appointed on 28 December 2018;
Jorge Nigaglioni (Non-Executive);
Lorna Inman (Non-Executive) - appointed on 1 September 2012 and ceased 25 February 2019;
Sir Tim McClement (Non-Executive) - ceased 28 December 2018; and
Robert Kenneth Gaunt (Executive) - ceased 28 December 2018.
Principal Activities
The principal activities of the Group during the full year were:
•
•
from 1 July 2018 to 27 December 2018 - the development, manufacturing and sale of ‘man
overboard safety solutions’ and implementing the reverse takeover by Jaxsta Holdings Pty
Limited; and
from 28 December 2018 - creating an online platform to hold official music metadata to develop
a repository of official music-related information, comprising liner notes and label copy.
Completion of the reverse takeover in December 2018 constituted a significant change in the nature
of the activities of the Group during the year. The Group’s focus is now solely pursuing the principal
activities of Jaxsta as set out above.
Dividends
No dividends were paid or declared during the current financial year.
Review of operations
Reverse takeover - acquisition of Jaxsta Holdings Pty Ltd
On 20 November 2018, Mobilarm Limited (‘Mobilarm’) (now renamed Jaxsta Limited) acquired 100%
of the share capital of Jaxsta Holdings Pty Ltd (‘Jaxsta Holdings’) in return of 109,399,795 ordinary
Jaxsta Limited
2019 Annual Report | Director’s Report
Jaxsta Limited
2019 Annual Report | Directors’ Report
shares in Mobilarm. This resulted in Jaxsta Holdings’ shareholders holding a controlling share in
Mobilarm, which was shortly thereafter renamed and re-listed as Jaxsta Limited (ASX: JXT).
The acquisition has been accounted for as a share-based payment and the principles of reverse
acquisition accounting have been applied, i.e., the reverse acquisition of Mobilarm by Jaxsta
Holdings. The consolidated results reflect the full year of Jaxsta Holdings and its controlled entities
for the entire year plus Jaxsta (formerly Mobilarm) from 28th December 2018 to 30 June 2019. The
comparative information represents Jaxsta Holdings and its controlled entities only.
The loss for the Group after providing for income tax amounted to $20,084,398 (30 June 2018:
$3,283,529).
The loss includes listing expenses of $14,227,655 (30 June 2018: $nil) of which $13,875,930 is a
deemed non-cash, non-recurring expense resulting from application of the reverse acquisition
accounting principles referred to below. This expense is effectively the difference between the net
assets of Jaxsta Holdings at 28 December 2018 and the value of the shares issued in Jaxsta (formerly
MBO) to the Jaxsta Holdings Pty Ltd shareholders.
Key financial matters
•
•
•
•
•
Employee Benefit Expense includes a non-cash component of $358,557 to record stock options
expenses
Product Development Expense includes a non-cash component of $177,259 to record stock
options expenses
Listing Expenses include a non-cash component of $13,875,930 representing the deemed cost of
the reverse takeover
Cash & Cash equivalents at 30 June 2019 of $2,452,760
Pre-existing Goodwill of $4,025,904
For further commentary please refer to notes to the Financial Statements commencing on page 25
of this Report.
Development update
Jaxsta has developed an online platform to hold official music metadata to develop a repository of
official music-related information, comprising liner notes and label copy. The platform progressed
through beta testing in 2017 and the subsequent beta version launch of the platform together with
the launch of Jaxsta’s website (Jaxsta.com) occurred on 13 June 2019.
As at 30 June 2019, Jaxsta had entered into a number of commercial data access agreements, and
metadata and artwork agreements, with relevant data owners to access and ingest their data into its
platform, creating an official source for much of this data.
The launch of the Beta signifies that Jaxsta is confident that it’s platform will provide qualitative data
coverage for its users.
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Significant changes in the state of affairs
Proceedings on behalf of the Company
On 20 November 2018, Mobilarm acquired Jaxsta Holdings and was renamed Jaxsta Limited. Refer to
‘Review of Operations’ for further information on acquisition.
On 28 December 2018, Mobilarm successfully completed a capital raising of $5,269,000 before
capital raising costs of $377,020 by issuing 26,345,000 ordinary shares at $0.20 per share and was
readmitted to the official list on the ASX.
On 14 May 2019, Jaxsta successfully completed a capital raising of $3,305,000 before capital raising
costs of $227,711 by issuing 13,220,000 ordinary shares at $0.25 per share.
Matters subsequent to the end of the financial year
In May 2018, Mobilarm entered into an agreement to sell all of the shares in its operating subsidiary,
Marine Rescue Technologies Limited (‘MRT’), to Secure2Go Limited (‘S2G’) and that agreement was
subsequently amended to incorporate JJC Capital Pte Ltd (‘JJC’) as a partial purchaser (S2G and JJC,
together the ‘MRT Purchasers’). The sale of MRT was completed on 28 December 2018 but the
obligation to pay the deferred consideration has not yet fallen due.
During the financial year, the MRT Purchasers and Jaxsta have entered into a number of agreements
amending key terms of the MRT sale (as detailed in Note 30 of the Notes to Financial Statements on
page 60 of this Report). The Company has already received $1,376,187 in connection with the sale
and an aggregate receivable of $4,623,813 is currently due to Jaxsta from the MRT Purchasers as
follows:
•
•
$623,813 on 28 December 2019; and
$4,000,000 on 28 December 2020.
On 25 September 2019 the MRT Purchasers and Jaxsta entered into a further agreement which,
subject to shareholder approval in accordance with the Listing Rules, will amend some of the key
terms of the MRT sale (the ‘Current Amendment Agreement’). If approved, the Current Amendment
Agreement will bring forward the deferred consideration payments and, in consideration for that
acceleration, will reduce the aggregate amount due to Jaxsta. Under the amended payment terms,
total consideration of:
•
•
$3,200,000 would be received, constituting an early repayment discount of $1,423,813, with a
first payment of $1,500,000 due promptly upon receipt of shareholder approval by Jaxsta and
the balance due no later than 31st March 2020; or
$3,800,000 would be received, constituting an early repayment discount of $823,813, with a first
payment of $1,500,000 due promptly upon receipt of shareholder approval by Jaxsta and the
balance due no later than 31st December 2020.
The first payment of $1,500,000 is currently held in an escrow account and will be release once
shareholder approval is received. The other key terms of the Current Amendment Agreement are
detailed in Note 30 of the Notes to Financial Statements on page 60 of this Report.
Resolutions relating the approval of the Current Amendment Agreement will be included in the
notice of meeting for Jaxsta’s 2019 Annual General Meeting.
No person has applied for leave of court to bring proceedings on behalf of Jaxsta or intervene in any
proceedings to which Jaxsta is a party for the purpose of taking responsibility on behalf of Jaxsta for
all or any part of those proceedings.
Jaxsta was not a party to any such proceedings during the year.
Options and Warrants
At the date of this Report, the unissued ordinary shares of Jaxsta under option are as set out below.
Grant Date
Date of Expiry
Exercise Price
Number under
Option/Warrants
16 November 2018
16 November 2023
16 November 2018
16 November 2023
28 March 2019
28 March 2019
14 March 2019
15 March 2019
15 March 2019
18 June 2019
18 June 2019
30 July 2019
28 March 2026
28 March 2025
14 March 2026
15 March 2028
15 March 2028
18 June 2027
18 June 2028
30 July 2028
$0.20
$0.30
$0.00
$0.651
$0.01
$0.01
$0.01
$0.01
$0.01
$0.01
20,000,000
1,000,000
990,000
601,923
2,852,420
675,573
675,573
562,978
562,977
469,148
28,390, 592
Neither the option holders nor the warrant holders have any rights to participate in any issues of
shares or other interests of Jaxsta or any other Group member.
Other than the warrants granted on 30 July 2019, there have been no other options or warrants
granted over unissued shares or interests of any controlled entity within the Group during or since
the end of the reporting period.
For details of options issued to Directors and executives as remuneration, refer to the Remuneration
Report.
No person entitled to exercise the option had or has any right by virtue of the option to participate
in any share issue of any other body corporate.
Information Relating to Directors and Company Secretary
Brett Cottle
Qualifications
Experience
Non-Executive Chairman
Bachelor of Laws
Order of Australia
Brett was the Chief Executive of Australasian Performing Right
Association Ltd (APRA) for 28 years until stepping down in June 2018.
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For the last 21 of those years Brett also held the position of Chief
Executive of Australasian Mechanical Copyright Owners Society Ltd
(AMCOS) following the merger of back offices of those organisations in
1997. APRA AMCOS administers performance, broadcast, on line and
recording rights in musical works on behalf of songwriters and music
publishers, and is the largest music industry body in Australasia with
annual turnover exceeding $430 million. Brett hold a law degree from
Sydney University, is a past Director of the Australian Copyright Council
and a past member of the Copyright Law Review Committee. Between
1991 and 2018 Brett was a Director of the International Confederation
of Societies of Authors and Composers (CISAC) and is the only
Australian to have served as Chair of that international body, a position
he held between 2005 and 2010. In 2012
Interest in Shares
166,668
Special Responsibilities
Chairman of Remuneration and Nomination Committee
Member of Audit & Risk Committee
Directorships held in other listed
entities during the three years prior to
the current year
None
Jacqueline Louez Schoorl
Chief Executive Officer and Executive Director
Qualifications
Experience
Australian Institute of Company Directors graduate and member
Jacqui’s career spans over two decades across music, film and
television, working for the likes of Channel 9, IF Magazine, George
Lucas’ private company on the Star Wars Episodes II and III movies, Baz
Luhrmann and Catherine Martin on their ‘Chanel No. 5’ campaign,
Amalgamated Holdings (now Event Hospitality) and EMI Music. For the
past 6.5 years, Jacqui has been working solely on Jaxsta. A regular
panelist, Jacqui’s speaking engagements have included Commonwealth
Bank’s Women In Focus conference 2017, BigSound, General Assembly,
Australian Music Week and Music Australia – Contemporary Music
Roundtable Conference, ARIA Masterclass series 2017 and ARIA Week
2018, The Future of What podcast and Vivid Ideas 2017 and 2018.
Jacqui also spends her time working as the Founder of Women In Music
Sydney, a non-profit organisation bringing together a dynamic group of
dedicated music professionals to network, learn and in the process
create a supportive community. She is also a Dementia Australia
advocate often speaking on her family's experience with Alzheimers
where she helps to shed some light on the journey for those with
Dementia or Alzheimer’s. Jacqui is a alumni member of CBA’s
(Commonwealth Bank of Australia’s) Women In Focus Program. Jacqui
is a graduate of the Australian Institute of Company Directors course.
Interest in Shares
Interest in Options
25,920,004
20,000,000
Special Responsibilities
None
Directorships held in other listed
entities during the three years prior to
the current year
None
Jorge Nigaglioni
Qualifications
Non-Executive
The Master of Business Administration
Bachelor of Science
Experience
Australian Institute of Company Director graduate and member
Certificate in Governance Practice and Administration from Chartered
Secretaries Australia
Jorge has over 24 years of experience in accounting and finance roles in
both public and private companies. Jorge has worked with start up
companies and has been CFO for two publicly listed companies in the
United States and Australia. As a Controller at Agilent Technologies, he
was involved in turning around two divisions to profitability. In his last
two years at PricewaterhouseCoopers he was involved in auditing and
consulting for start up companies, where he has focused his expertise
to launch early ventures to success. Jorge has a Masters of Business
Administration from the University of Wisconsin-Madison and a
Bachelor’s of Science degree in Business Administration from Bryant
University.
Interest in Shares
Special Responsibilities
650,179
None
Directorships held in other listed
entities during the three years prior to
the current year
None
Linda Jenkinson
Qualifications
Experience
Non-Executive
Bachelor of Business Studies
Master of Business Administration
New Zealand CPA (non-current)
Linda is a successful businesswomen and entrepreneur with over 25
years of general management and consulting experience. She’s
founded numerous businesses and was the first New Zealand woman
to list a company on the NASDAQ stock exchange, with DMSC, the $250
million on-demand courier company she co-founded. She also co-
founded a global customer and employee experience platform, which
was sold to the Accor hotel group, and WOW for Africa which was a
social venture fund supporting women entrepreneurs in Senegal. Linda
is an experienced company director, sitting on multiple boards
including Air New Zealand, Eclipx Group and Guild Group. She’s
received a number of awards including EY Master Entrepreneur of the
Year New Zealand in 2013, World Class New Zealander in 2016 and is a
Top 100 Most Influential Women in San Francisco. Linda is currently
the Chair of Unicef New Zealand. She has been based for many years in
San Francisco and during this time for a five years served on the Board
of the Bay Area Red Cross and was Chair of the fund raising committee.
Prior to her entrepreneurial career, Linda was a Partner at A.T. Kearney
in the Global Financial Services practice where she worked with some
of the world’s largest financial institutions. Linda holds a Master of
Business Administration from The Wharton School, University of
Pennsylvania in Finance and a Bachelor of Business Studies from
Massey University in Data Processing and Accounting & Finance. She
qualified for her New Zealand CPA (ACA). Linda is currently building
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Level-Up, a program to supercharge high-growth companies who are
expanding globally. She is a New Zealand citizen who holds residency in
the United States and co-locates between Wellington and San
Francisco. Linda will be considered independent in her role as Non-
Executive Director following completion of the Acquisition.
Interest in Shares and Options
None
Special Responsibilities
Chairman of Audit & Risk Committee
Directorships held in other listed
entities during the three years
prior to the current year
Shelley Burger*
Qualifications
Experience
Member of Remuneration and Nomination Committee
Air New Zealand Limited; Eclipx Group Limited; Guild Group Holdings &
Subsidiaries; and Harbour Asset Management
Company Secretary
Bachelor of Design Computing (Honours)
Bachelor of Laws
Shelley has over 12 years’ experience in legal practice and governance
and has worked with ASX-listed entities in the financial services,
technology and telecommunications industries. Shelley is admitted in
the High Court of Australia, the Federal Court of Australia and Supreme
Court of New South Wales.
* The following people also acted as Company Secretary of Jaxsta during the year:
o Naomi Dolmatoff (appointed 28 December 2018, ceased 12 August 2019);
o
o David McArthur (appointed 11 January 2011, ceased 20 November 2018).
Jorge Nigaglioni (appointed 20 November 2018, ceased 28 December 2018); and
Meetings of Directors
The number of meetings of Jaxsta’s Board of Directors (‘the Board’) held during the year ended 30
June 2019, and the number of meetings attended by each Director were:
Board
Audit & Risk
Committee
Remuneration &
Nominations
Committee
Eligible
Attended
Eligible
Attended
Eligible
Attended
Brett Cottle
Jacqui Louez Schoorl
Linda Jenkinson
Jorge Nigaglioni
Lorna (Launa) Inman*
Robert Ken Gaunt**
Tim McClement**
13
13
13
17
3
4
4
13
12
12
17
3
4
3
3
-
3
-
1
-
-
3
-
3
-
1
-
-
1
-
1
-
-
-
-
1
-
1
-
-
-
-
* Launa Inman ceased to be a director on 25 February 2019
** Robert Ken Gaunt and Tim McClement ceased to be directors on 28 December 2018
Jaxsta Limited
2019 Annual Report | Directors’ Report | Remuneration Report
Jaxsta Limited
2019 Annual Report | Director’s Report | Renumeration Report
Remuneration Report
The Directors of Jaxsta present the remuneration report contained on pages 16 to 24 for the Group
for the financial year ended 30 June 2019 (the ‘Remuneration Report’). The Remuneration Report
forms part of the Directors’ Report.
The Renumeration Report is made in accordance with a resolution of Directors and details the
remuneration arrangements of the Group’s Key Management Personnel (‘KMP’). It has been
prepared in accordance with the requirements of the Corporations Act 2001 (Cth) (the ‘Corporations
Act’) and its Regulations and has been audited as required by section 308(3C) of the Corporations
Act.
KMP are those persons having authority and responsibility for planning, directing and controlling the
activities of the Group, directly or indirectly, including all Directors.
The Remuneration Report is set out into the following key sections:
•
Principles used to determine the nature and amount of remuneration;
•
• Details of remuneration;
Service agreements;
Share based compensation; and
Additional disclosures relating to KMP.
•
•
Principles used to determine the nature and amount of remuneration
The remuneration policy of Jaxsta has been designed to align KMP objectives with the Group’s
vision, values and overall business objectives. The objective of the remuneration policy is to provide
a fixed remuneration component and offering specific long-term incentives to ensure reward for
performance is competitive and appropriate for the results delivered.
The Board believes the remuneration policy to be appropriate and effective in its ability to attract
and retain high-quality KMP to run and manage the Group.
The Board ensures that executive reward satisfies the following key criteria for good reward
governance practices:
•
•
•
fair and reasonable;
create value for shareholders; and
linking performance of the Group to the individual and the general external market
environment.
The Remuneration and Nominations Committee is responsible for determining and reviewing
remuneration arrangements for Jaxsta’s directors and the Group’s executives. The performance of
the Group depends on the quality of its Directors and executives. The remuneration philosophy is to
attract, motivate and retain high performance and high quality personnel.
The reward framework is designed to align executive reward to shareholders’ interests. The Board
have considered that it should seek to enhance shareholders’ interests by:
15
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2019 Annual Report | Directors’ Report | Remuneration Report
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2019 Annual Report | Directors’ Report | Remuneration Report
2019 Annual Report | Director’s Report | Renumeration Report
• motivating KMP to pursue the Group's long-term growth and success;
•
•
demonstrate a clear relationship between the Group's overall performance and the performance
of KMP; and
align the interests of KMP with the creation of value for shareholders.
Additionally, the reward framework seeks 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 directors’
and executive directors’ remuneration is separate.
Non-Executive Remuneration
The Board’s policy is to remunerate non-executive directors at market rates for time, commitment
and responsibilities. The Remuneration and Nominations Committee may, from time to time, receive
advice from independent remuneration consultants to ensure Non-Executive Directors’ fees and
payments are appropriate and in line with the market. The Chairman’s fees are determined
independently to the fees of other Non-Executive Directors based on comparative roles in the
external market. The Chairman is not present at any discussions relating to the determination of his
own remuneration.
ASX listing rules require the aggregate non-executive directors’ remuneration be determined
periodically by a general meeting. At the extraordinary meeting of shareholders held on 17 August
2018, the current maximum annual aggregate remuneration for Non-Executive Directors of
$500,000 was approved. The current aggregate Non-Executive Directors’ remuneration level is
within this approved range.
Executive Remuneration
The Group aims to reward executives based on their position and responsibility, with a level and mix
of remuneration which has both fixed and variable components.
Executives may receive their fixed remuneration in the form of cash or other fringe benefits (for
example parking). Tax effective salary sacrifice arrangements are encouraged where this does not
create any additional costs to the Group and provides additional value to the executive.
The short-term incentives (’STI’) program will be designed to align the targets of the business units
with the short-term performance hurdles of executives. STI payments are based on specific annual
targets and key performance indicators (‘KPIs’) being achieved. KPIs include client (data partner)
engagement, leadership contribution and product development. A one-off grant of options was
offered to long term employees (including two KMP) who transitioned across to the Group as part of
the reverse takeover. Employees were offered an equivalent number of $0 priced options as those
held prior to the reverse takeover.
The longer-term incentives (‘LTI’) include share-based payments (for example Tax Effective Incentive
Options) exercisable over a 2 to 4 year period, are awarded to key staff and executives as part of a
long-term retention strategy.
The Company’s 2019 Annual Meeting (AGM)
A Remuneration Report has been prepared for the 2019 year and a resolution will be put to the 2019
AGM to ask shareholders to approve it.
Details of Remuneration
The KMP of the consolidated entity consisted of:
•
the directors of Jaxsta Limited:
Jacqui Louez Schoorl – Co-Founder & Chief Executive Officer;
o
o Brett Cottle – Non-Executive Chairman
o Linda Jenkinson – Non-Executive Director
Jorge Nigaglioni – Non-Executive Director
o
o Lorna Inman - Non-Executive Director (28 Dec 2019 to 25 Feb 2019);
o Ken Gaunt – Director (to 28 December 2018);
o Tim McClement – Independent Chairman (to December 2018); and
The executive remuneration and reward framework has four components:
•
and the following executives:
•
•
•
•
base pay and non-monetary benefits;
short-term performance incentives;
share-base payments; and
other remuneration such as superannuation and long service leave.
The combination of these comprise the executive’s total remuneration.
Fixed remuneration consisting of base salary, superannuation and non-monetary benefits, are
reviewed annually by the Remuneration and Nominations Committee based on individual and
business unit performance, the overall performance of the Group and the general external pay
environment.
o Philip Morgan – Chief Information Officer;
o Renee Bryant – Chief Financial Operations Officer; and
o Richard Huey – Head of Partnerships.
Amounts of Remuneration
Details of the remuneration of KMP of the consolidated Group are set out in the following tables.
Prior to the acquisition on 28 December 2018, Jaxsta Holdings Pty Limited was not required to
prepare a Remuneration report in accordance with the Corporations Act.
The 2019 table below represents remuneration paid by the consolidated entity consisting of Jaxsta
Holdings Pty Limited and its subsidiaries for the entire financial year and Mobilarm Limited (now
known as Jaxsta Limited) for the period from 28 December 2018 to 30 June 2019.
17
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2019
Short term benefits
Post-
employment
benefits
Cash salary and
fees
Cash bonus
Non-monetary Superannuation
Long-term
benefits
Share-based
payments
Long Services
Leave
Equity-settled
Non-Executive Directors:
Brett Cottle (Chairman) (Note 1)
Linda Jenkinson (Note 1)
Jorge Nigaglioni (Note 1)
Lorna Inman (Note 2)
Executive Directors:
Jacqui Louez Schoorl
Other Key Management Personnel:
Philip Morgan
Renee Bryant
Richard Huey (Note 3)
60,000
32,850
30,000
10,950
221,159
202,113
200,360
125,627
883,059
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
65,700
32,850
32,850
10,950
5,700
-
2,850
-
-
-
-
-
-
-
-
-
18,738
23,090
66,904
329,891
19,087
19,000
-
65,375
12,292
4,868
-
40,250
45,928
-
36,563
149,394
279,420
224,228
162,190
1,138,078
-
-
-
-
-
-
-
-
-
-
Robert Ken Gaunt (Note 4)
Tim McClement (Note 4)
Jorge Nigaglioni (Note 5)
410,282
161,488
377,065
948,835
1,831,894
Total for period 1 Jul 2018 to 30 June 2019
Note 1. Represents remuneration from 28 December 2018 to 30 June 2019
Note 2. Represents remuneration from 28 December 2018 to 25 February 2019, being date of resignation of
director
Note 3. In addition to fixed fee payment, contractor is eligible for a 20% (US$20,000) Performance bonus / At
risk STI.
Note 4. Represents remuneration from 1 July 2018 to 28 December 2018, being date of resignation of director.
Note 5. Represents remuneration from 1 July 2018 to 28 December 2018.
410,282
161,488
412,886
984,656
2,122,734
-
-
35,821
35,821
101,196
-
-
-
-
40,250
-
-
-
-
-
The proportion of remuneration linked to performance and the fixed proportion is set out below.
Name
Non-Executive Directors:
Brett Cottle (Chairman)
Linda Jenkinson
Jorge Nigaglioni
Executive Directors:
Jacqui Louez Schoorl
Other Key Management Personnel:
Philip Morgan
Renee Bryant
Richard Huey
Robert Ken Gaunt
Tim McClement
Jorge Nigaglioni
2019
100%
100%
100%
50%
100%
100%
84%
100%
100%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
50%
-
-
16%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
* At Jaxsta’s extraordinary general meeting held on 13 June 2019, shareholders approved 3,000,000 unquoted
options to be granted to each of Brett Cottle and Linda Jenkinson. As at the date of this Report, the options
have not yet been issued.
No cash bonuses were paid to KMPs during the year.
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Directors’ Report | Remuneration Report
2019 Annual Report | Director’s Report | Renumeration Report
Service Agreements
Remuneration and other terms of employment for KMPs are formalised in service agreements.
Details of these agreements are set out below.
Jacqueline Louez Schoorl
Title:
Co-founder & Chief Executive Officer
Agreement commenced:
16 November 2018
Term of agreement:
No fixed term
Details:
Initial base salary for year ended 30 June 2019 is $110,000 per annum,
plus superannuation from commencement; increasing to: (i) $205,000
per annum, plus superannuation upon signing of one commercial
milestone contract, then (ii) $300,000 per annum, plus superannuation
upon signing of two commercial milestone contracts. Salary package to
be reviewed annually by the Remuneration and Nominations
Committee. 12-month termination notice by either party.
Philip Morgan
Title:
Chief Information Officer
Agreement commenced:
Term of agreement:
4 April 2016
No fixed term
Details:
Renee Bryant
Base salary for year ended 30 June 2019 is $220,000 per annum
inclusive of superannuation, plus phone allowance. Salary package to
be reviewed annually by the Remuneration and Nominations
Committee. 1-month termination notice by either party.
Agreement commenced:
26 March 2018
Term of agreement:
No fixed term
Details:
Richard Huey
Title:
Agreement commenced:
Term of agreement:
Details:
Base salary for year ended 30 June 2019 is $200,000 per annum, plus
superannuation, plus phone allowance and parking. Salary package to
be reviewed annually by the Remuneration and Nominations
Committee. 3-month termination notice by either party.
Head of Partnerships
1 March 2016
No fixed term
Fee for year ended 30 June 2019 is US$100,000 per annum, plus 20%
performance bonus, plus US$3,700 home office allowance (previously
US$72,000 up to 31 December 2019). Contract terms to be reviewed
annually by the Remuneration and Nominations Committee. 14 days
termination notice by either party.
Fixed remuneration
At risk - STI
At risk - LTI
2018
2019
2018
2019
2018
Title:
Chief Financial Operations Officer
19
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Share-based compensation
Options
The terms and conditions of each grant of options over ordinary shares affecting remuneration of
Directors and other KPMs in this financial year or future reporting years are as set out below.
Grant Date
16-Nov-18
28-Mar-19
28-Mar-19
28-Mar-19
28-Mar-19
28-Mar-19
28-Mar-19
Vesting date and
exercisable date
Expiry Date
Exercise Price
Fair value per option
at grant date
Variable *
1-May-19
28-Mar-20
28-Mar-20
28-Mar-21
28-Mar-22
28-Mar-23
16-Nov-23
28-Mar-26
28-Mar-26
28-Mar-25
28-Mar-25
28-Mar-25
28-Mar-25
$0.20
$0.00
$0.00
$0.65
$0.65
$0.65
$0.65
$0.033
$0.390
$0.390
$0.137
$0.137
$0.137
$0.137
* vest in tranches of 1,000,000 options for each $0.10 increase in Jaxsta’s share price (measured on a VWAP
basis so that each increment increase has to exist for at least 30 consecutive ASX trading days) from A$0.20.
Options granted carry no dividend or voting rights.
All options were granted over unissued fully paid ordinary shares in the company. Options vest
based on the provision of service over the vesting period whereby the executive becomes
beneficially entitled to the option on vesting date. Options are exercisable by the holder as from the
vesting date. There has not been any alteration to the terms or conditions of the grant since the
grant date. There are no amounts paid or payable by the recipient in relation to the granting of such
options other than on their potential exercise.
The number of options over ordinary shares granted to and vested by directors and other key
management personnel as part of compensation during the year ended 30 June 2019 is set out
below.
Name
Number of options granted during
the year
Number of options vested during the
year
Jacqui Louez Schoorl
Philip Morgan
Richard Huey
Total for period 1 Jul 2018 to 30 June 2019
2019
20,000,000
675,000
150,000
20,825,000
2018
-
-
-
-
2019
-
-
-
-
2018
-
-
-
-
Values of options over ordinary shares granted, exercised and lapsed for directors and other key
management personnel as part of compensation during the year ended 30 June 2019 is set out
below.
Name
Value of options
granted during
the year
Value of options
exercised during
the year
Value of
options lapsed
during the year
Remuneration
consisting of options
for the year
Jacqui Louez Schoorl
Philip Morgan
Richard Huey
Total for period 1 Jul 2018 to 30 June 2019
$
66,904
45,928
36,563
149,394
$
-
-
-
-
$
-
-
-
-
%
20%
16%
23%
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Directors’ Report | Remuneration Report
2019 Annual Report | Director’s Report | Renumeration Report
* At Jaxsta’s extraordinary general meeting held on 13 June 2019, shareholders approved 3,000,000 unquoted
options to be granted to each of Brett Cottle and Linda Jenkinson. As at the date of this Report, the options
have not yet been issued.
Performance Rights
There were no performance rights over ordinary shares issued to Directors and other KMPs as part
of compensation that were outstanding as at 30 June 2019.
There were no performance rights over ordinary shares granted to or vested by Directors and other
KMPs as part of compensation during the year ended 30 June 2019.
Additional Disclosures Relating to KMP
KMP shareholdings
The number of ordinary shares in Jaxsta held by each KMP of the Group during the financial year is
set out below.
Shareholding
Brett Cottle (Chairman)
Jorge Nigaglioni**
Lorna Inman
Jacqui Louez Schoorl
Philip Morgan
Renee Bryant
Robert Ken Gaunt ***
Tim McClement ***
Jorge Nigaglioni
Total for period 1 Jul 2018 to 30 June 2019
Balance at the
start of the year*
Received as part
of remuneration
Additions
Disposals / Other
Balance at the end
of the year
-
-
-
7,329,413
-
-
7,329,413
68,715,026
1,000,000
-
69,715,026
77,044,439
-
-
-
-
-
-
-
-
-
-
-
-
166,668
-
666,666
18,590,591
10,000
266,669
19,700,594
-
-
-
-
19,700,594
-
650,179
499,999
-
-
-
1,150,178
62,272,523
900,000
-
63,172,523
64,322,701
166,668
650,179
166,667
25,920,004
10,000
266,669
27,180,187
6,442,503
100,000
-
6,542,503
33,722,690
* Balance at the start of the year represents shareholding in Jaxsta Holdings Pty Limited prior to reverse
acquisition.
** Other includes shares held in Mobilarm Limited prior to reverse acquisition. The shares were converted into
Jaxsta Limited after capital reorganisation as referred in Note 10 in the Notes to the Financial Statements on
page 44 of the Report.
***A 1:10 share consolidation occurred during the reporting period. Shares held in name of Blazzed Pty
Limited.
****A 1:10 share consolidation occurred during the reporting period. Shares held in name of Lady Lynne
McClement.
Option Holding
The number of options over ordinary shares in the company held during the financial year by each
director and other members of key management personnel of the Group, including their personally
related parties, is set out below.
Option holdings
Jacqui Louez Schoorl
Philip Morgan
Richard Huey
Total for period 1 Jul 2018 to 30 June 2019
Balance at the
start of the year
-
-
-
-
Granted
Exercised
20,000,000
675,000
150,000
20,825,000
-
-
-
-
Expired/ forfeited
/other
-
-
-
-
Balance at the end
of the year
20,000,000
675,000
150,000
20,825,000
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Jaxsta Limited
2019 Annual Report | Directors’ Report | Remuneration Report
2019 Annual Report | Director’s Report | Renumeration Report
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Directors’ Report | Remuneration Report
2019 Annual Report | Director’s Report | Renumeration Report
Other Equity-related KMP Transactions
Non-audit services
There have been no other transactions involving equity instruments apart from those described in
the tables above relating to options, rights and shareholdings.
Other Transactions with KMP and/or their Related Parties
During the financial year:
•
•
payments for music industry liaison services and product development services from New
Holland Pty Limited (related to Jacqui Louez Schoorl) of $24,000 (ex GST) were made; and
services were provided by Jaxsta Co-Founder, Louis Schoorl.
There were no other transactions conducted between the Group and KMP or their related parties,
apart from those disclosed above relating to equity, compensation and loans, that were conducted
other than in accordance with normal employee, customer or supplier relationships on terms no
more favourable than those reasonably expected under arm’s length dealings with unrelated
persons.
This concludes the Remuneration Report, which has been audited.
Auditor’s Independence Declaration
A copy of the auditor’s independence declaration as required under section 307C of the
Corporations Act appears on page 63 of this Report.
Indemnity and insurance of officers
Jaxsta has indemnified the Directors and officers of Group for costs incurred, in their capacity as a
Director or officers, for which they may be held personally liable, except where there is a lack of
good faith. During the financial year, Jaxsta paid a premium in respect of a contract to insure the
Directors and officers of the Group against a liability to the extent permitted by the Corporations
Act. The contract of insurance prohibits disclosure of the nature of the liability and the amount of
the premium.
Indemnity and insurance of auditor
Jaxsta has not, during or since the end of the financial year, indemnified or agreed to indemnify the
auditor of the Group or any related entity against a liability incurred by the auditor. During the
financial year, Jaxsta has not paid a premium in respect of a contract to insure the auditor of the
Group or any related entity.
Proceedings on behalf of the company
No person has applied to the Court under section 237 of the Corporations Act for leave to bring
proceedings on behalf of Jaxsta, or to intervene in any proceedings to which Jaxsta is a party for the
purpose of taking responsibility on behalf of Jaxsta for all or part of those proceedings.
Details of the amounts paid or payable to the auditor for non-audit services provided during the
financial year by the auditor are outlined in Note 10 to the Financial Statements on page 44 of this
Report. The Directors are satisfied that the provision of non-audit services during the financial year,
by the auditor (or by another person or firm on the auditor’s behalf), is compatible with the general
standard of independence for auditors imposed by the Corporations Act. The Directors are of the
opinion that the services as disclosed in Note 10 to the Financial Statements do not compromise the
external auditor’s independence requirements of the Corporations Act for the following reasons:
•
•
•
all non-audit services have been reviewed and approved to ensure that they do
not impact the integrity and objectivity of the auditor; and
none of the services undermine the general principles relating to auditor independence as set
out in APES 110 Code of Ethics for Professional Accountants issued by the Accounting
Professional and Ethical Standards Board, including reviewing or auditing the auditor’s own
work, acting in a management or decision-making capacity for Jaxsta, acting as advocate for
Jaxsta or jointly sharing economic risks and rewards.
Rounding of amounts
Jaxsta is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian
Securities and Investments Commission, relating to ‘rounding-off’. Amounts in this Report have been
rounded off in accordance with that Corporations Instrument to the nearest thousand dollars, or in
certain cases, the nearest dollar.
Corporate Governance
The Group’s Corporate Governance Statement and Appendix 4G checklist are released to ASX on the
same day the Report is released. The Corporate Governance Statement and Corporate Governance
Manual can be found on Jaxsta’s website at https://www.jaxsta.com. This Report is made in
accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act.
This Report is made in accordance with a resolution of Directors, pursuant to section 306(3)(a) of the
Corporations Act.
On behalf of the directors
Jacqueline Louez Schoorl
Chief Executive Officer
26 September 2019
Sydney, New South Wales
23
24
Jaxsta Limited
2019 Annual Report | Consolidated Statement of Profit or Loss and Other Comprehensive
Income
For the year ended 30 June 2019
Jaxsta Limited
2019 Annual Report | Consolidated Statement of Profit or Loss and Other Comprehensive
Consolidated Statement of Profit and Loss and Other
Comprehensive Income for the year ending 30 June 2019
Income for the year ended 30 June 2019
Revenue from continuing operations
Interest income
Other Revenue
Research and development rebate
Other revenue
Total Revenue
Expenses
Employee benefits expense
Marketing expenses
Occupancy expenses
Professional fees
Product development expense
Depreciation and amortisation expense
Finance costs
Other expenses
Listing expenses
Impairment expenses
Total Expenses
Loss before income tax
Income tax expense
30 June
2019
$
30 June
2018
$
3,649
665,657
35,657
704,963
(2,736,521)
(498,605)
(145,536)
(793,060)
(757,230)
(42,993)
(18,887)
(745,061)
(14,227,655)
(823,813)
363
583,622
-
583,985
(1,805,132)
(290,960)
(161,117)
(590,847)
(234,707)
(343,674)
(10,282)
(430,795)
-
-
(20,789,361)
(3,867,514)
(20,084,398)
(3,283,529)
-
-
4
4
5
5
5
5
6
Jaxsta Limited
2019 Annual Report | Consolidated Statement of Financial Position
As at 30 June 2019
Jaxsta Limited
Consolidated Statement of Financial Position
for the year ending 30 June 2019
2019 Annual Report | Consolidated Statement of Financial Position
For the year ended 30 June 2019
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Trade and other receivables
Property, plant and equipment
Intangible assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Loans and borrowings
Provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Provisions
30 June
2019
$
30 June
2018
$
11
12
15
12
13
14
16
17
18
18
19
21
2,452,760
705,248
187,402
3,345,410
3,176,187
42,019
4,393,845
7,612,051
10,957,461
599,692
26,597
159,389
785,678
88,902
88,902
874,580
10,082,881
35,670,064
(26,183,999)
596,816
10,082,881
46,299
752,131
60,963
859,393
-
40,148
4,389,459
4,429,607
5,289,000
706,796
2,622,437
84,790
3,414,023
-
-
3,414,023
1,874,977
7,974,578
(6,099,601)
-
1,874,977
Loss after income tax expense for the year
attributable to the owners of Jaxsta Limited
(20,084,398)
(3,283,529)
TOTAL NON-CURRENT LIABILITIES
Other comprehensive income for the year, net of tax
-
-
Total comprehensive income for the year
attributable to the owners of Jaxsta Limited
(20,084,398)
(3,283,529)
Earnings per share
Basic earnings per share (cents)
Diluted earnings per share (cents)
10
10
(0.15)
(0.15)
(0.07)
(0.07)
The accompanying notes should be read in conjunction with these consolidated financial statements.
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Accumulated losses
Reserves
TOTAL EQUITY
The accompanying notes should be read in conjunction with these consolidated financial statements.
The accompanying notes should be read in conjunction with these consolidated financial statements.
25
26
The accompanying notes should be read in conjunction with these consolidated financial statements.
Jaxsta Limited
2019 Annual Report | Consolidated Statement of Changes in Equity
For the year ended 30 June 2019
Jaxsta Limited
Consolidated Statement of Changes in Equity
2019 Annual Report | Consolidated Statement of Changes in Equity
For the year ended 30 June 2019
for the year ending 30 June 2019
As at 1 July 2017
Contributed
equity
$
5,499,602
Loss after income tax expense for the year
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
-
-
-
Transactions with owners in their capacity as owners
Shares issued during the period
Balance at 30 June 2018
Refer to note 2 for explanation on comparatives
As at 1 July 2018
Loss after income tax expense for the year
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
2,474,976
7,974,578
7,974,578
Reserves
$
Accumulated
losses
$
Total
equity
$
-
-
-
-
-
-
-
(2,816,072)
2,683,530
(3,283,529)
(3,283,529)
-
-
(3,283,529)
(3,283,529)
-
2,474,976
(6,099,601)
1,874,977
(6,099,601)
1,874,977
(20,084,398)
(20,084,398)
-
-
(20,084,398)
(20,084,398)
Transactions with owners in their capacity as owners
Contributions of equity, net of transaction cost (note 19)
Share-based payment (note 21)
27,695,486
-
-
596,816
-
-
27,695,486
596,816
Balance at 30 June 2019
35,670,064
596,816
(26,183,999)
10,082,881
Jaxsta Limited
2019 Annual Report | Consolidated Statement of Cash Flows
For the year ended 30 June 2019
Jaxsta Limited
Consolidated Statement of Cash Flows
2019 Annual Report | Consolidated Statement of Cash Flows
for the year ending 30 June 2019
For the year ended 30 June 2019
CASH FLOW FROM OPERATING ACTIVITIES
Receipts from grants - research & development
Payments to suppliers and employees
Interest received
Interest costs
30 June
2019
$
30 June
2018
$
696,745
(6,891,396)
3,649
(11,537)
603,285
(3,385,292)
363
(10,282)
Net cash flows (used in) operating activities
(6,202,539)
(2,791,926)
CASH FLOW FROM INVESTING ACTIVITIES
Payments for plant and equipment
Payment for intangibles
Cash acquired from acquisition of subsidiary
(15,297)
(75,157)
5,332,655
Net cash flows provided by/(used in) investing activities
5,242,201
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Share issue transaction costs
Proceeds from borrowings
Advances to related parties
Repayment of borrowings
Proceeds from borrowings - related parties
Loan repayments made to related parties
4,471,645
(604,731)
77,056
-
(54,451)
465,654
(988,374)
(23,341)
-
-
(23,341)
2,474,976
-
1,127,592
(750,000)
-
-
-
Net cash flows provided by financing activities
3,366,799
2,852,568
Net increase in cash held
Cash at beginning of financial year
Cash at the end of the period
2,406,461
46,299
2,452,760
37,301
8,998
46,299
The accompanying notes should be read in conjunction with these consolidated financial statements.
The accompanying notes should be read in conjunction with these consolidated financial statements.
The accompanying notes should be read in conjunction with these consolidated financial statements.
The accompanying notes should be read in conjunction with these consolidated financial statements.
27
28
Jaxsta Limited
2019 Annual Report | Notes to the Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
Notes to the Financial Statements
Note 1. General information
The financial statements contained on pages 28 to 31 of this Report cover Jaxsta Limited (‘Jaxsta’,
'company' or 'parent') as a consolidated entity consisting of Jaxsta Limited and the entities it controlled at
the end of, or during, the financial year ('consolidated entity' or ‘the Group’) ended 30 June 2019 (the
‘Financial Statements’). The Financial Statements are presented in Australian dollars, which is Jaxsta
presentation currency. The functional currency of Jaxsta Holdings Pty Ltd is Australian dollars and Jaxsta
is Australian dollars.
Jaxsta is a listed public company limited by shares, incorporated and domiciled in Australia.
A description of the nature of the Group's operations and its principal activities are included in the
Directors' Report (pages 9 to 26 of this Report). The Directors’ Report is not part of the Financial
Statements.
The Financial Statements were authorised for issue, in accordance with a resolution of Directors, on 25
September 2019. The Directors have the power to amend and reissue the Financial Statements.
Note 2. Significant accounting policies and basis of preparation
The Financial Statements are general purpose, consolidated financial statements which have been
prepared in accordance with the Corporations Act, Australian Accounting Standards and Interpretations of
the Australian Accounting Standards Board and in compliance with International Financial Reporting
Standards as issued by the International Accounting Standards Board. The Group is a for-profit entity for
financial reporting purposes under Australian Accounting Standards. Material accounting policies
adopted in the preparation of the Financial Statements are presented below and have been consistently
applied unless stated otherwise.
Except for cash flow information, the Financial Statements have been prepared on an accrual basis and
are based on historical costs, modified, where applicable, by the measurement at fair value of selected
non-current assets, financial assets and financial liabilities.
The principal accounting policies adopted in the preparation of the Financial Statements are set out either
in the respective notes or below. These policies have been consistently applied to all the years presented,
unless otherwise stated.
a) New, revised or amending Accounting Standards and Interpretations
Certain new accounting standards and interpretations have been published that are not mandatory for the
30 June 2019 reporting period. The Directors’ assessment of the impact of these new standards and
interpretations is that they will result in no material changes to the amounts recognised in the Financial
Statements but may impact the type of information disclosed in the Financial Statements.
b) Going concern basis of accounting
The Group incurred a loss after tax and before listing costs of $5,856,742, which includes listing expenses
of $14,227,655 and share based payment expenses of $596,816 and has a net cash outflow from
operations of $6,202,539 for the period ended 30 June 2019 and had net current assets of $2,559,732 and
net tangible assets of $5,689,036 as at that date. As at the date of this Report, the Group had cash assets
of $923,771. The consolidated entity is the process of transitioning from a start-up/development business
to a commercialised business with the intention of deriving product sales. No product sales have been
derived to date.
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
These conditions above give rise to a material uncertainty which may cast significant doubt over the
Group’s ability to continue as a going concern.
Management have prepared cash flow forecasts for the Group for the period ending 31 December 2020
which assumes continuity of business on the basis of the following events occurring:
a) the completion of the Jaxsta Beta Metadata platform resulting in the subsequent
commercialisation, accordingly cash receipts from revenues from platform use have been forecast;
b) the receipt of a R&D tax concession for the financial year ended 30 June 2019 and establishing a
line of credit secured against the future R&D tax concessions that Group expects to receive in
respect of FY2020;
c)
the partial receipt of the deferred consideration receivables in respect of the MRT sale or entry into
binding documentation, which will have the effect of bringing forward the collection of:
I.
II.
$3,200,000 with an early repayment discount of $1,423,813, with the first payment of
$1,500,000 due promptly upon obtaining shareholder approval in respect of the relevant
amendment documentation and the balance due no later than 31st March 2020; or
$3,800,000 with an early repayment discount of $823,813, with the first payment of
$1,500,000 due promptly upon obtaining shareholder approval in respect of the relevant
amendment documentation and the balance due no later than 31st December 2020;
d) further development expenditure on transferring the Jaxsta Beta Site; and
e) a proposed capital raising within the next 12 months.
The Directors believe that the Group is a going concern and that the above events will eventuate in the
short term and accordingly the Financial Statements have been prepared on a going concern basis.
In the event that the above assumptions do not eventuate, there are material uncertainties that cast
significant doubt over the ability of the Group to continue as a going concern.
In the event that the Group does not achieve the conditions stated above by the Directors, the ability of
Jaxsta and therefore the Group to continue as a going concern may be impacted. As a result, the Group
may not be able to realise its assets and extinguish its liabilities in the ordinary course of operations and
at the amounts stated in the Financial Statements.
No adjustments have been made to the recoverability and classification of recorded asset values and the
amount and classification of liabilities that might be necessary should Jaxsta and the Group not continue
as going concerns.
Acquisition accounting and comparative information
On 28th December 2018, Jaxsta Limited (the ‘legal parent’) acquired Jaxsta Holdings Pty Ltd (the ‘legal
subsidiary). For accounting purposes, the acquisition has been accounted for as a share-based payment
and the principles of reverse acquisition have been applied.
As a result of the acquisition, the comparative information represents Jaxsta Holdings Pty Ltd and its
controlled entities only. The current period represents the consolidated entity comprising: (a) Jaxsta
Holdings Pty Ltd for the entire year; and (b) Jaxsta Limited from 28th December 2018 to 30 June 2019.
Therefore, the comparatives will not compare to the consolidated financial results of Jaxsta published in
prior financial reporting periods. Refer to ‘Business Combination’ accounting policy (at page 40 of this
Report) for further explanation of the accounting for this transaction.
29
30
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
Critical accounting estimates
The preparation of the Financial Statements requires the use of certain critical accounting estimates. It
also requires management to exercise its judgement in the process of applying the Group's accounting
policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and
estimates are significant to the Financial Statements are disclosed in Note 3 (at page 44 of this Report).
Principles of consolidation
The Financial Statements incorporate the assets and liabilities of all subsidiaries of Jaxsta as at 30 June
2019 and the results of all subsidiaries for the year then ended.
Subsidiaries are all those entities over which the consolidated entity has control. The consolidated entity
controls an entity when the consolidated entity is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power to direct the
activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to
the consolidated entity. They are de-consolidated from the date that control ceases.
The acquisition of Jaxsta Holdings Pty Limited by Jaxsta has been accounted as a share-based payment in
accordance with AASB 2 ‘Share- based Payments’ and the Financial Statements represent a continuation
of the Financial Statements of Jaxsta Holdings. The comparative information is related to Jaxsta Holdings
Pty Limited and its controlled entities operations and not those of Jaxsta. As a result, the comparatives
will not compare to the consolidated financial results of Jaxsta (formerly Mobilarm Limited) published in
prior financial reporting periods. Refer to ‘Business Combination’ accounting policy below at page 40 of
this Report for further explanation of the accounting for this transaction.
Intercompany transactions, balances and unrealised gains on transactions between entities in the
consolidated entity are eliminated. Unrealised losses are also eliminated unless the transaction provides
evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been
changed where necessary to ensure consistency with the policies adopted by the consolidated entity.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in
ownership interest, without the loss of control, is accounted for as an equity transaction, where the
difference between the consideration transferred and the book value of the share of the non-controlling
interest acquired is recognised directly in equity attributable to the parent.
Where the consolidated entity loses control over a subsidiary, it derecognises the assets including
goodwill, liabilities and non-controlling interest in the subsidiary together with any cumulative translation
differences recognised in equity. The consolidated entity recognises the fair value of the consideration
received and the fair value of any investment retained together with any gain or loss in profit or loss.
Operating segments
Operating segments are presented using the 'management approach', where the information presented is
on the same basis as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The
CODM is responsible for the allocation of resources to operating segments and assessing their
performance.
Revenue recognition
Revenue was measured at the fair value of the consideration received or receivable after taking into
account any trade discounts and volume rebates allowed. When the inflow of consideration was deferred, it
was treated as the provision of financing and was discounted at a rate of interest that is generally
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
accepted in the market for similar arrangements. The difference between the amount initially recognised
and the amount ultimately received was interest revenue.
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of
calculating the amortised cost of a financial asset and allocating the interest income over the relevant
period using the effective interest rate, which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset to the net carrying amount of the financial asset.
Research & Development tax incentive
Research & development tax incentive is recognised when it is received.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established being
when the contract performance obligations are satisfied.
Income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based
on the applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and
liabilities attributable to temporary differences, unused tax losses and the adjustment recognised for
prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be
applied when the assets are recovered or liabilities are settled, based on those tax rates that are enacted
or substantively enacted, except for:
• when the deferred income tax asset or liability arises from the initial recognition of goodwill or an
asset or liability in a transaction that is not a business combination and that, at the time of the
transaction, affects neither the accounting nor taxable profits; or
• when the taxable temporary difference is associated with interests in subsidiaries, associates or joint
ventures, and the timing of the reversal can be controlled and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting
date. Deferred tax assets recognised are reduced to the extent that it is no longer probable that future
taxable profits will be available for the carrying amount to be recovered. Previously unrecognised deferred
tax assets are recognised to the extent that it is probable that there are future taxable profits available to
recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current
tax assets against current tax liabilities and deferred tax assets against deferred tax liabilities; and they
relate to the same taxable authority on either the same taxable entity or different taxable entities which
intend to settle simultaneously.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-
current classification.
31
32
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
An asset is classified as current when: it is either expected to be realised or intended to be sold or
consumed in the entity's normal operating cycle; it is held primarily for the purpose of trading; it is
expected to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent
unless restricted from being exchanged or used to settle a liability for at least 12 months after the
reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the entity's normal operating
cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the
reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12
months after the reporting period. All other liabilities are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
Property, plant and equipment
Plant and equipment
Plant and equipment are measured on the cost basis and therefore carried at cost less accumulated
depreciation and any accumulated impairment. In the event the carrying amount of plant and equipment
is greater than the estimated recoverable amount, the carrying amount is written down immediately to the
estimated recoverable amount and impairment losses are recognised. A formal assessment of recoverable
amount is made when impairment indicators are present.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess
of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the
expected net cash flows that will be received from the asset’s employment and subsequent disposal. The
expected net cash flows have been discounted to their present values in determining recoverable
amounts.
Depreciation
The depreciable amount of all fixed assets is depreciated on a straight-line basis over the asset’s useful
life to the consolidated group commencing from the time the asset is held ready for use. Leasehold
improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated
useful lives of the improvements.
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant
and equipment over their expected useful lives as follows:
Computer Equipment
2 to 3 years
Leasehold improvements
5 to 10 years
Office Equipment
5 to 10 years
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at
each reporting date.
Leasehold improvements and plant and equipment under lease are depreciated over the unexpired period
of the lease or the estimated useful life of the assets, whichever is shorter.
An item of property, plant and equipment is derecognised upon disposal or when there is no future
economic benefit to the consolidated entity. Gains and losses between the carrying amount and the
disposal proceeds are taken to profit or loss.
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
Financial Instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual
provisions to the instrument. For financial assets, this is the date that the entity commits itself to either
the purchase or sale of the asset (i.e. trade date accounting is adopted).
Financial instruments are initially measured at fair value plus transaction costs, except where the
instrument is classified “at fair value through profit or loss”, in which case transaction costs are expensed
to profit or loss immediately. Where available, quoted prices in an active market are used to determine fair
value. In other circumstances, valuation techniques are adopted.
Classification and subsequent measurement
Financial instruments are subsequently measured at fair value, amortised cost using the effective interest
method, or cost.
Amortised cost is calculated as the amount at which the financial asset or financial liability is measured
at initial recognition less principal repayments and any reduction for impairment, and adjusted for any
cumulative amortisation of the difference between that initial amount and the maturity amount
calculated using the effective interest method.
The effective interest method is used to allocate interest income or interest expense over the relevant
period and is equivalent to the rate that discounts estimated future cash payments or receipts (including
fees, transaction costs and other premiums or discounts) over the expected life (or when this cannot be
reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the
financial asset or financial liability. Revisions to expected future net cash flows will necessitate an
adjustment to the carrying amount with a consequential recognition of an income or expense item in
profit or loss.
The Group does not designate any interests in subsidiaries, associates or joint ventures as being subject
to the requirements of Accounting Standards specifically applicable to financial instruments (AASB 9).
Financial assets at fair value through profit or loss
Financial assets are classified at “fair value through profit or loss” when they are contingent consideration
that may be paid by an acquirer as part of a business combination to which AASB 3: Business
Combinations applies, held for trading for the purpose of short-term profit taking, derivatives not held for
hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable
performance evaluation where a group of financial assets is managed by key management personnel on a
fair value basis in accordance with a documented risk management or investment strategy. Such assets
are subsequently measured at fair value with changes in carrying amount included in profit or loss. The
net gain or loss recognised in profit or loss includes any dividend or interest earned from the financial
asset and is included in the face of the statement of profit and loss and other comprehensive income.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are
not quoted in an active market and are subsequently measured at amortised cost. Gains or losses are
recognised in profit or loss through the amortisation process and when the financial asset is
derecognised.
33
34
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
Financial liabilities
Non-derivative financial liabilities other than financial guarantees are subsequently measured at
amortised cost. Gains or losses are recognised in profit or loss through the amortisation process and when
the financial liability is derecognised.
Contingent consideration of an acquirer in a business combination to which AASB 3: Business
Combinations applies is classified as a financial liability and measured at fair value through profit or loss.
Intangibles
Goodwill
Goodwill is calculated as the excess of the sum of:
a) the consideration transferred;
b) any non-controlling interest; and
c)
d) over the acquisition date fair value of any identifiable assets acquired in a business combination.
the acquisition date fair value of any previously held equity interest;
Under the ‘full goodwill method’, the fair values of the non-controlling interests are determined using
valuation techniques which make the maximum use of market information where available.
Goodwill is not amortised but is tested for impairment annually and is allocated to the Group’s cash
generating units or groups of cash generating units, which represent the lowest level at which goodwill is
monitored but where such level is not larger than an operating segments. Gains and losses on the disposal
of an equity interest include the carrying amount of goodwill related to the entity sold.
Changes in the ownership interests in a subsidiary are accounted for as equity transactions and do not
affect the carrying values of goodwill.
Trademarks
Trademarks are recognised at cost of acquisition. They have an infinite life and are carried at cost less any
impairment losses.
Platform Development Costs
Platform Development Costs are recognised at cost of acquisition. They have a finite life and are carried at
cost less any accumulated amortisation and any impairment losses. Platform Development Costs are
amortised over their useful lives as determined by the Directors of 3 years from 13 June 2019.
Impairment of non-financial assets
Non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by
which the asset's carrying amount exceeds its recoverable amount.
Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The
value-in-use is the present value of the estimated future cash flows relating to the asset using a pre-tax
discount rate specific to the asset or cash-generating unit to which the asset belongs. Assets that do not
have independent cash flows are grouped together to form a cash-generating unit.
At the end of each reporting period, the Group assesses whether there is any indication that an asset may
be impaired. The assessment will include the consideration of external and internal sources of information
including dividends received from subsidiaries, associates or joint ventures deemed to be out of pre-
acquisition profits. If such an indication exists, an impairment test is carried out on the asset by
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
comparing the recoverable amount of the asset, being the higher of the asset’s fair value less costs of
disposal and value in use, to the asset’s carrying amount. Any excess of the asset’s carrying amount over
its recoverable amount is recognised immediately in profit or loss, unless the asset is carried at a revalued
amount in accordance with another Standard (e.g. in accordance with the revaluation model in AASB 116:
Property, Plant and Equipment). Any impairment loss of a revalued asset is treated as a revaluation
decrease in accordance with the respective Accounting Standard.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates
the recoverable amount of the cash-generating unit to which the asset belongs.
Impairment testing is performed annually for goodwill, intangible assets with indefinite lives and
intangible assets not yet available for use.
When an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating
unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying
amount does not exceed the carrying amount that would have been determined had no impairment loss
been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is
recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in
which case the reversal of the impairment loss is treated as a revaluation increase.
Foreign Currency Transactions and Balances
Functional and presentation currency
The functional currency of each of the Group’s entities is the currency of the primary economic
environment in which that entity operates. The Financial Statements are presented in Australian dollars,
which is the parent entity’s functional currency.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end
exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange
rate at the date of the transaction. Non-monetary items measured at fair value are reported at the
exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in profit or loss, except
where deferred in equity as a qualifying cash flow or net investment hedge.
Exchange differences arising on the translation of non-monetary items are recognised directly in other
comprehensive income to the extent that the underlying gain or loss is recognised in other comprehensive
income; otherwise the exchange difference is recognised in profit or loss.
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 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 as 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.
35
36
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
Consideration is given to expect future wage and salary levels, experience of employee departures and
periods of service. Expected future payments are discounted using market yields at the reporting date on
corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated
future cash outflows.
Share-based payments
Equity-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares that are provided to employees in
exchange for the rendering of services.
The costs of equity-settled transactions are measured at fair value on grant date. Fair value is
independently determined using either the Binomial or Black-Scholes option pricing model that takes into
account the exercise price, the term of the option, the impact of dilution, the share price at grant date and
expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate
for the term of the option, together with non-vesting conditions that do not determine whether the
consolidated entity receives the services that entitle the employees to receive payment. No account is
taken of any other vesting conditions.
The cost of equity-settled transactions is recognised as an expense with a corresponding increase in
equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date
fair value of the award, the best estimate of the number of awards that are likely to vest and the expired
portion of the vesting period. The amount recognised in profit or loss for the period is the cumulative
amount calculated at each reporting date less amounts already recognised in previous periods.
Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to
market conditions are considered to vest irrespective of whether or not that market condition has been
met provided all other conditions are satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has
not been made. An additional expense is recognised, over the remaining vesting period, for any
modification that increases the total fair value of the share-based compensation benefit as at the date of
modification.
If the non-vesting condition is within the control of the consolidated entity or employee, the failure to
satisfy the condition is treated as a cancellation. If the condition is not within the control of the
consolidated entity or employee and is not satisfied during the vesting period, any remaining expense for
the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any
remaining expense is recognised immediately. If a new replacement award is substituted for the cancelled
award, the cancelled and new award is treated as if they were a modification.
Contributed equity
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a
deduction, net of tax, from the proceeds.
Business combinations
The acquisition method of accounting is used to account for business combinations regardless of whether
equity instruments or other assets are acquired.
The consideration transferred is the sum of the acquisition-date fair values of the assets transferred,
equity instruments issued or liabilities incurred by the acquirer to former owners of the acquiree and the
amount of any non-controlling interest in the acquiree. For each business combination, the non-
controlling interest in the acquiree is measured at either fair value or at the proportionate share of the
acquiree's identifiable net assets. All acquisition costs are expensed as incurred to profit or loss.
On the acquisition of a business, the consolidated entity assesses the financial assets acquired and
liabilities assumed for appropriate classification and designation in accordance with the contractual
terms, economic conditions, the consolidated entity's operating or accounting policies and other pertinent
conditions in existence at the acquisition-date.
Where the business combination is achieved in stages, the consolidated entity remeasures its previously
held equity interest in the acquiree at the acquisition-date fair value and the difference between the fair
value and the previous carrying amount is recognised in profit or loss.
Contingent consideration to be transferred by the acquirer is recognised at the acquisition-date fair value.
Subsequent changes in the fair value of the contingent consideration classified as an asset or liability is
recognised in profit or loss. Contingent consideration classified as equity is not remeasured and its
subsequent settlement is accounted for within equity.
The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-
controlling interest in the acquiree and the fair value of the consideration transferred and the fair value of
any pre-existing investment in the acquiree is recognised as goodwill. If the consideration transferred and
the pre-existing fair value is less than the fair value of the identifiable net assets acquired, being a bargain
purchase to the acquirer, the difference is recognised as a gain directly in profit or loss by the acquirer on
the acquisition-date, but only after a reassessment of the identification and measurement of the net
assets acquired, the non-controlling interest in the acquiree, if any, the consideration transferred and the
acquirer's previously held equity interest in the acquirer.
Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively
adjusts the provisional amounts recognised and also recognises additional assets or liabilities during the
measurement period, based on new information obtained about the facts and circumstances that existed
at the acquisition-date. The measurement period ends on either the earlier of (i) 12 months from the date
of the acquisition or (ii) when the acquirer receives all the information possible to determine fair value.
Acquisition of Jaxsta Holdings Pty Ltd
During the financial year, Jaxsta Holdings Pty Limited’s original shareholders obtained a controlling
interest in Jaxsta after the acquisition transaction. This transaction did not meet the definition of a
business combination per AASB 3 ‘Business Combinations’. The transaction has therefore been accounted
for in the Financial Statements in accordance with AASB 2 ‘Share-based Payments’ and as a continuation
of the financial statements of Jaxsta Holdings Pty Limited, together with a deemed issue of shares,
equivalent to the shares held by the former shareholders of Jaxsta. The deemed issue of shares is, in effect,
a share-based payment transaction whereby Jaxsta Holdings Pty Limited is deemed to have received the
net assets of Jaxsta, together with the listing status of Jaxsta. The overall accounting effect is very similar
to that of a reverse acquisition in AASB 3.
Because the Financial Statements represent a continuation of the financial statements of Jaxsta Holdings
Pty Limited, the principles and guidance on the preparation and presentation of the consolidated financial
statements in a reverse acquisition set out in AASB 3 have been applied:
37
38
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
•
•
•
•
•
•
•
fair value adjustments arising at acquisition were made to Mobilarm Limited’s (now renamed Jaxsta)
assets and liabilities, not those of Jaxsta Holdings Pty Limited;
the cost of the acquisition, and amount recognised as issued capital to affect the transaction, is based
on the notional amount of shares that Jaxsta Holdings Pty Limited would have needed to issue to
acquire the same shareholding percentage in Mobilarm Limited (now renamed Jaxsta) at the
acquisition date and the value of the existing Mobilarm Limited's options at the date of the acquisition;
retained earnings and other equity balances in the Financial Statements at acquisition date are those
of Jaxsta Holdings Pty Ltd;
a shared-based payment transaction arises whereby Jaxsta Holdings Pty Limited is deemed to have
issued shares in exchange for the net assets of Mobilarm Limited’s (now renamed Jaxsta) (together
with its listing status). The listing status does not qualify for recognition as an intangible asset and
has therefore been expensed in the profit or loss as a share based payment listing expense;
the equity structure in the Financial Statements (the number and type of equity instruments issued) at
the date of the acquisition reflects the equity structure of Mobilarm Limited’s (now renamed Jaxsta),
including the equity instruments issued by Mobilarm Limited’s (now renamed Jaxsta) effect the
acquisition;
the results for the year ended 30 June 2019 comprise the consolidated results for the full-year of Jaxsta
Holdings Pty Limited together with the results of Mobilarm Limited’s (now renamed Jaxsta) from 28
December 2018 to 30 June 2019; and
the comparative results represent the results of Jaxsta Holdings Pty Limited and its controlled entities
only.
Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events,
for which it is probable that an outflow of economic benefits will result and that outflow can be reliably
measured.
Provisions are measured using the best estimate of the amounts required to settle the obligation at the
end of the reporting period.
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other
short-term, highly liquid investments with original maturities of three months or less that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
Trade and Other Receivables
Trade and other receivables include amounts due from customers for goods sold and services performed
in the ordinary course of business. Receivables expected to be collected within 12 months of the end of the
reporting period are classified as current assets. All other receivables are classified as non-current assets.
Trade and other receivables are initially recognised at fair value and subsequently measured at amortised
cost using the effective interest method, less any provision for impairment.
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the
reporting period and which are unpaid. Due to their short-term nature they are measured at amortised
cost and are not discounted. The amounts are unsecured and are usually paid within 30 days of
recognition.
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of
transaction costs. They are subsequently measured at amortised cost using the effective interest method.
Finance costs
Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs
are expensed in the period in which they are incurred.
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Jaxsta Holdings
Pty Limited, excluding any costs of servicing equity other than ordinary shares, by the weighted average
number of ordinary shares outstanding during the financial year, adjusted for bonus elements or share
splits in ordinary shares issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to
take into account the after income tax effect of interest and other financing costs associated with dilutive
potential ordinary shares and the weighted average number of shares assumed to have been issued for no
consideration in relation to dilutive potential ordinary shares.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST
incurred is not recoverable from the tax authority. In this case it is recognised as part of the cost of the
acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount
of GST recoverable from, or payable to, the tax authority is included in other receivables or other payables
in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or
financing activities which are recoverable from, or payable to the tax authority, are presented as operating
cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to,
the tax authority.
Adoption of new Accounting Standards
Australian Accounting Standards and Interpretations that have recently been issued or amended but are
not yet mandatory, have not been early adopted by the Group for the annual reporting period ended 30
June 2019. The Group has not yet assessed the impact of these new or amended Accounting Standards and
Interpretations.
The following new accounting standards which apply from 1 July 2018 have been adopted.
•
AASB 9 Financial Instruments
The standard is applicable to annual reporting periods beginning on or after 1 January 2018.
The Standard is applicable retrospectively (subject to the provisions on hedge accounting outlined
below) and includes revised requirements for the classification and measurement of financial
39
40
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
instruments, revised recognition and derecognition requirements for financial instruments, and
simplified requirements for hedge accounting.
The key changes that may affect the company on initial application include certain simplifications to
the classification of financial assets, simplifications to the accounting of embedded derivatives,
upfront accounting for expected credit loss, and the irrevocable election to recognise gains and losses
on investments in equity instruments that are not held for trading in other comprehensive income.
AASB also introduces a new model for hedge accounting that will allow greater flexibility in the ability
to hedge risk, particularly with respect to hedges of non-financial items. Should the entity elect to
change its hedge policies in line with the new hedge accounting requirements of the Standard, the
application of such accounting would be largely prospective.
The adoption of AASB 9 has resulted in an expected credit loss on the MRT Receivable amounting to
$823,813 during the year ended 30 June 2019. There are no other impacts as a result of the application
of AASB 9.
•
AASB 15 Revenue from Contracts with Customers
The standard is applicable to annual reporting periods beginning on or after 1 January 2018.
AASB 15 introduces a five step process for revenue recognition with the core principle of the new
Standard being for entities to recognise revenue to depict the transfer of goods or services to
customers in amounts that reflect the consideration (that is, payment) to which the entity expect to be
entitled in exchange for those goods or services. Accounting policy changes will arise in timing of
revenue recognition, treatment of contracts costs and contracts which contain a financing element.
The application of this standard has no impact on the Financial Statements as Jaxsta did not have any
contracts with customers in the 2019 financial year.
The following new accounting standard applies from 1 July 2019 have not been early adopted.
•
AASB 16 Leases
AASB 16 will cause the majority of an entity to be brought onto the statement of financial position.
There are limited exceptions relating to short term leases and low value assets which may remain off
balance sheet. The calculation of the lease liability will take into account appropriate discount rates,
assumptions about lease term and increases in lease payments. A corresponding right to use asset will
be recognised which will be amortised over the term of the lease. Rent expense will no longer be shown;
the profit and loss impact of the leases will be through amortisation and interest charges.
Whilst the impact of AASB 16 has not yet been quantified, the entity currently does not have any
operating leases. The expected impact on the financial statements is minimal.
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts in the financial statements. Management continually
evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and
expenses. Management bases its judgements, estimates and assumptions on historical experience and
on other various factors, including expectations of future events; management believes to be reasonable
under the circumstances. The resulting accounting judgements and estimates will seldom equal the
related actual results. The judgements, estimates and assumptions that have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes)
within the next financial year are discussed below.
41
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Financial Statements
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
either the Binomial or Black-Scholes model taking into account the terms and conditions upon which the
instruments were granted. The key estimate used in the valuation is the expected stock price volatility.
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.
Goodwill
Goodwill arises as a result of a business combination and represents the excess of the fair value of the
consideration over the fair value of the net assets acquired, which involved judgement. The Group tests
goodwill for impairment annually or more frequently if events or changes in circumstances indicate the
goodwill may be impaired. The recoverable amount of each Cash Generating Unit (‘CGU’) is determined
based on fair value less costs to sell which is based on recently transacted market prices of the Jaxsta
Limited stock on the ASX that arose from capital raisings.
Going Concern
The going concern basis of accounting is considered a critical estimate and judgement area as
Management and the Directors have made the use of significant accounting estimates and judgements in
the preparation of the cash flow forecast used in assessing the going concern of the Group.
Note 4. Other income
Research and development tax incentive
Other revenue
Total other revenue
Note 5. Loss for the year
30 June 2019
$
665,657
35,657
701,314
30 June 2019
$
Loss before income tax includes the following specific expenses:
a. Expenses
Other Expenses includes the following material expenses:
Professional advisers fees
Board fees
Commission
Employee benefit expenses includes the following:
Salary and wages
Share-based payments expense
Superannuation expense
2,201,414
358,557
176,550
102,803
258,446
66,566
Total employee benefit expenses
2,736,521
30 June 2018
$
583,622
-
583,622
30 June 2018
$
109,574
-
-
1,659,387
-
145,745
1,805,132
42
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
b. Significant Revenue and Expenses
Impairment expenses
- Impairment expenses
Listing expenses include the following:
Share based payment listing expense
Legal and professional expenses
Total listing expenses
(i)
(ii)
823,813
13,875,930
351,725
14,227,655
-
-
-
-
(i) As a result of negotiation post year end, management have determined to impair the MRT receivable by $823,813 as
at 30 June 2019. Refer to Note 12.
(ii) Listing expenses of $14,227,655 of which $13,875,930 is a deemed non-cash, non-recurring expense resulting from
application of the reverse acquisition accounting principles.
Note 6. Tax expense
30 June 2019
$
30 June 2018
$
The prima facie tax on loss from ordinary activities before
income tax is reconciled to income tax as follows:
Prima facie tax payable on profit from ordinary activities before
income tax rate at 27.5% (2018: 27.5%)
Add:
Tax effect amounts which are not deductible/taxable) in calculating taxable income:
- Permanent differences
(5,523,209)
4,541,668
Current year tax losses not recognised
Income tax attributable to the group
Tax losses not recognised
981,542
-
(902,970)
275,808
627,163
-
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Post-employment benefits
These amounts are superannuation contributions made during the year.
Other long-term benefits
These amounts represent long service leave benefits accruing during the year, long-term disability benefits and
deferred bonus payments.
Share-based payments
These amounts represent the expense related to the participation of KMP in equity-settled benefit schemes as
measured by the fair value of the options, rights and shares granted on grant date. Share-based payments is detailed
in Note 21.
Note 8. Auditor's remuneration
Remuneration of the auditor for:
Auditing or reviewing the financial statements by Walker
Wayland Audit (WA) Pty Ltd
Auditing or reviewing the financial statements by Ernst &
Young for three years ended 30 June 2016, 2017 and 2018
30 June 2019
$
30 June 2018
$
53,403
170,600
224,003
-
-
-
Note 9. Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Note 10. Earnings per share
30 June 2019
$
Loss after income tax attributable to the owners of Jaxsta Limited
(20,084,398)
30 June 2018
$
(3,283,529)
The potential tax benefit for tax losses has not been recognised in the statement of financial position. Utilisation of the
carry forward tax losses may be subject to a substantial annual limitation due to the ownership change limitations
and the same business test accordingly the recovery of this benefit is not considered probable.
Note 7. Key management personnel compensation
Weighted average number of ordinary shares used in
calculating basic earnings per share
Weighted average number of ordinary shares used in
calculating diluted earnings per share
Refer to the remuneration report contained in the directors’ report for details of the remuneration paid or payable to
each member of the Group’s key management personnel (KMP) for the year ended 30 June 2019.
The totals of remuneration paid to KMP of the company and the Group during the year are as follows:
Basic earnings per share
Diluted earnings per share
Number
Number
133,873,975
133,873,975
Cents
(0.15)
(0.15)
44,812,106
44,812,106
Cents
(0.07)
(0.07)
Short-term employee benefits
Post-employment benefits
Other long-term benefits
Share-based payments
Total KMP compensation
30 June 2019
$
883,059
65,375
40,250
149,395
1,138,079
30 June 2018
$
110,000
10,450
-
-
120,450
Short-term employee benefits
These amounts include fees and benefits paid to the non-executive Chair and non-executive directors as well as all
salary, paid leave benefits, fringe benefits and cash bonuses awarded to executive directors and other KMP.
The weighted average number of ordinary shares for the comparative period has been adjusted to give effect to the
capital reorganisation which occurred during the 30 June 2019 financial year.
Note 11. Cash and cash equivalents
Cash on hand
Cash at bank
Term Deposits
30 June 2019
$
101
2,432,659
20,000
2,452,760
(i)
30 June 2018
$
-
46,299
-
46,299
43
44
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
(i) The term deposit will mature on 26 February 2020 with 31 days notice early withdrawal facility available. The interest
rate is 2.3%.
The balances of receivables that remain within initial trade terms (as detailed in the table) are considered to be of high
credit quality.
Reconciliation of cash
Cash and cash equivalents at the end of the financial year
as shown in the statement of cash flows is reconciled to
items in the statement of financial position as follows:
Cash and cash equivalents
Note 12. Trade and other receivables
Current
GST receivable
Other receivables
Total
2,452,760
2,452,760
46,299
46,299
30 June 2019
$
30 June 2018
$
(i)
74,735
630,513
705,248
-
752,131
752,131
(i) $623,813 of other receivables relates to the deferred consideration in relation to the sale of the MRT business which
is due from Secure2go Group Ltd on or before 28 December 2019. The terms have changed post year end as referred to
in the subsequent events note 30.
(i) $750,000 excess cash resources were advanced to the holders of the convertible note in accordance with an
agreement and was extinguished in cash on the acquisition of Jaxsta Holdings Pty Limited by Jaxsta Limited on 28
December 2018. For details, refer to Note 22: Related Party Disclosures.
Non Current
Other receivables
Provision for impairment
(i)
(ii)
30 June 2019
$
4,000,000
(823,813)
3,176,187
30 June 2018
$
-
-
-
Total Trade and other receivables
3,881,435
752,131
(i) Other receivables relate to the deferred consideration in relation to the sale of the MRT business which is due from
Secure2go Group Ltd after 28 December 2020.
(ii) The original receivable from Secure2Go Group Ltd was $4,000,000 and it has been impaired for $823,813 as at 30
June 2019. The total current and non current Secure2Go receivable after the impairment provision is $3,800,000 as at
30 June 2019.
The following table details the Group’s trade and other receivables exposed to credit risk with ageing analysis and
impairment provided for thereon. Amounts are considered as “past due” when the debt has not been settled, with the
terms and conditions agreed between the Group and the customer or counterparty to the transaction. Receivables that
are past due are assessed for impairment by ascertaining solvency of the debtors and are provided for where there are
specific circumstances indicating that the debt may not be fully repaid to the Group.
Gross
Amount
Impaired
<30
31-60
61-90
>90
Within initial
trade terms
Past due but not impaired (days overdue)
2019
GST receivable
Other receivables
MRT receivables
Total
2018
Other receivables
Total
74,735
6,700
-
-
4,623,813 (823,813)(i)
4,705,248
-
752,131
752,131
-
-
-
4,569
-
4,569
2,131
2,131
-
-
-
-
-
-
-
-
-
-
-
-
-
2,131
-
2,131
74,735
-
4,623,813
4,698,548
-
-
750,000
750,000
(i) Refer to Note 12 and 30 for details of renegotiated term of the MRT receivables.
Note 13. Property, plant and equipment
Office Equipment - at cost
Less: Accumulated depreciation
Leasehold Improvements - at
Less: Accumulated depreciation
Computer Equipment - at cost
Less: Accumulated depreciation
Total property, plant and equipment
30 June 2019
$
41,446
(16,147)
25,299
30 June 2019
$
312,163
(312,163)
-
118,116
(101,396)
16,720
42,019
30 June 2018
$
37,171
(10,983)
26,188
30 June 2018
$
312,163
(312,163)
-
107,092
(93,133)
13,959
40,147
Movements in Carrying Amounts
Movements in the carrying amounts for each class of property, plant and equipment between the beginning and the
end of the current financial year:
Consolidated Group:
Balance at 1 July 2017
Additions
Disposals
Depreciation expense
Balance at 30 June 2018
Office
Equipment
$
Leasehold
Improvement
$
Computer
Equipment
$
Total
$
36,371
800
-
(10,983)
26,188
300,843
-
(942)
(299,901)
-
4,117
15,963
-
(6,121)
13,959
341,331
16,763
(942)
(317,005)
40,147
45
46
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
For the year ended 30 June 2019
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
Additions
Depreciation expense
Balance at 30 June 2019
Note 14. Intangible assets
Platform Development Costs
Less: Accumulated amortisation
Formation Costs
Less: Accumulated amortisation
Trademark
Less: Accumulated amortisation
Goodwill
Less: Impairment
4,275
(5,164)
25,299
-
-
-
11,024
(8,263)
16,720
15,299
(13,427)
42,019
30 June 2019
$
178,963
(i)
30 June 2018
$
153,508
(2,778)
176,185
118,684
(118,684)
-
191,756
-
191,756
30 June 2019
$
4,025,904
-
4,025,904
(ii)
(iii)
-
153,508
94,640
(26,649)
67,991
142,056
-
142,056
30 June 2018
$
4,025,904
-
4,025,904
Total Intangible assets
4,393,845
4,389,459
Balance at 30 June 2018
Balance at the beginning of the year
Additions
Amortisation charge
Impairment losses
Net Carrying Amount
Balance at 30 June 2019
Balance at the beginning of the year
Additions
Disposals
Amortisation charge
Impairment losses
Net Carrying Amount
Platform
Developmen
t Costs $
Formation
Costs $
Trademark $ Goodwill $
Total $
147,508
6,000
-
-
153,508
153,508
25,455
-
(2,778)
-
176,185
94,640
-
(26,649)
-
67,991
67,991
24,044
-
(92,035)
-
128,285
13,771
-
-
4,025,904
-
-
-
4,396,337
19,771
(26,649)
-
142,056
4,025,904
4,389,459
142,056
49,700
-
-
-
4,025,904
-
-
-
-
4,389,459
99,199
-
(94,813)
-
-
191,756
4,025,904
4,393,845
(i) Platform Development costs
Development costs have been capitalised at cost. They have a finite life and are carried at cost less any accumulated
amortisation and any impairment losses. Platform Development Costs are amortised over their useful lives, being 3
years as determined by the Directors. Amortisation commenced on 13 June 2019.
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
(ii) Trademark
Trademarks are assessed to have an indefinite life and will not be amortised.
(iii) Goodwill
Goodwill has been capitalised at the amount of excess consideration paid over purchase of Jaxsta Enterprise Pty Ltd.
The recoverable amount of Jaxsta business is determined based on fair value less costs to sell, which is based on
recent capital raisings and quoted prices on the active market, being the ASX.
In December 2018, the company raised equity funds via the issue of 26,345,000 shares at an issue price of $0.20 per
share raising a total of $5,269,000 and in May 2019 the company raised further equity funds via the issue of 13,220,000
shares at an issue price of $0.25 per share raising a total of $3,305,000. The active market transactions would value the
cash generating unit in excess of its carrying value based on the respective market capitalisation. The market price of
the Jaxsta Ltd shares as at the date of this report is $0.21.
Note 15. Other assets
Prepayments
Rental Bond
Total
Note 16. Trade and other payables
Current
Unsecured liabilities:
Trade creditors
Other creditors and accruals
Total
Note 17. Loans and borrowings
Current
Convertible notes
Insurance funding
Loan from related party
Founder loan
Total
30 June 2019
$
161,002
26,400
187,402
30 June 2018
$
34,563
26,400
60,963
30 June 2019
$
30 June 2018
$
300,707
298,985
599,692
30 June 2019
$
-
26,597
-
-
26,597
(i)
(ii)
(iii)
(iv)
418,201
288,595
706,796
30 June 2018
$
1,500,000
-
822,437
300,000
2,622,437
(i) The convertible note at 30 June 2018 was owing to Mobilarm Limited and was extinguished on the acquisition of
Jaxsta Holdings Pty Limited by Mobilarm Limited through the issue of shares in Jaxsta Limited.
(ii) Insurance funding is a ten months short term loan with an fixed interest rate of 5.85%
(iii) The company entered into a loan arrangement facility at no interest with New Holland Pty Limited for $272,680
which was repaid in cash in January 2019 and $549,798 loan with Marine Recue Technologies Ltd was partially repaid in
September 2018, with a balance of $34,758 carried forward. Further loans of $465,654 were obtained during the
financial year, of which $200,654 were repaid in cash during January 2019, with the remaining balance settled through
the issue of shares.
(iv) One of the founding directors entered into a loan agreement with an interest rate of 0%. The loan was repaid by the
issue of shares.
47
48
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Note 18. Provisions
Current
Employee benefits - annual
Non-current
Employee benefits - long service
Provision for Employee Benefits
30 June 2019
$
159,389
159,389
30 June 2019
$
88,902
88,902
30 June 2018
$
84,790
84,790
30 June 2018
$
-
-
Provision for employee benefits represents amounts accrued for annual leave and long service leave.
The current portion for this provision includes the total amount accrued for annual leave entitlements and the
amounts accrued for long service leave entitlements that have vested due to employees having completed the required
period of service. Based on past experience, the Group does not expect the full amount of annual leave or long service
leave balances classified as current liabilities to be settled within the next 12 months. However, these amounts must be
classified as current liabilities since the Group does not have an unconditional right to defer the settlement of these
amounts in the event employees wish to use their leave entitlement.
The non-current portion for this provision includes amounts accrued for long service leave entitlements that have not
yet vested in relation to those employees who have not yet completed the required period of service.
Note 19. Issued Capital
The share capital dollar value represents the continuation of Jaxsta Holdings Pty Ltd. The number of shares on issue
reflect those of Jaxsta Limited.
Refer to note 2 "Business combinations' for further details of the accounting principles applied.
Ordinary shares - Fully paid
30 June 2019 30 June 2018 30 June 2019 30 June 2018
Shares
231,326,901
Shares
493,119,559
231,326,901 493,119,559
$
$
35,670,064
35,670,064
7,974,578
7,974,578
Date
Issue Price No. of shares
$
Balance
Share consolidation 1 for 10
Conversion of performance
Performance shares
Conversion of loan
Shares to effect the acquisition
of Jaxsta Holdings Pty Ltd.
Notional reverse acquisition
adjustment
Shares issued on capital raising
Shares issued on capital raising
Shares issue transaction costs,
Balance
1 July 2018
17 August 2018
28 December 2018
28 December 2018
28 December 2018
28 December 2018
28 December 2018
28 December 2018
14 May 2019
30 June 2019
493,119,559
(448,307,453)
5,000,000
550,000
32,000,000
109,399,795
0.00
0.00
0.13
0.20
-
0.20
0.25
26,345,000
13,220,000
-
231,326,901
7,974,578
-
-
-
4,000,000
21,879,959
(6,153,742)
5,269,000
3,305,000
(604,731)
35,670,064
49
Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote
per share at shareholder meetings.
Note 20. Cash flow information
30 June 2019
$
(20,084,398)
a. Reconciliation of Cash Flows from Operating Activities with Loss after Income Tax
Loss for the period
Cash flows excluded from loss attributable to operating activities
Non-cash flows in loss:
- Depreciation and amortisation
- Write-off capitalised expenditure
- Net foreign currency losses/(gains)
- Impairment expenses
- Listing expenses
- Employee share scheme expense
Changes in assets and liabilities:
- (increase)/decrease in trade and term receivables
- (increase)/decrease in prepayments
- (decrease)/increase in trade payables and accruals
- (decrease)/increase in provisions
- (increase)/decrease in other current assets
42,993
41,204
7,350
823,813
13,875,930
535,816
-
(22,130)
(1,507,315)
163,501
(79,303)
30 June 2018
$
(3,283,529)
343,674
-
-
-
-
-
19,663
-
157,211
-
(28,945)
Cash flows from operating activities
(6,202,539)
(2,791,926)
b. Non-cash Financing and Investing Activities
(i) Loans and Borrowing:
$1,500,000 convertible note were converted to shares in Jaxsta Limited on 28 December 2019.
$299,717 Loan from related party were converted to shares in Jaxsta Limited on 28 December 2019
$300,000 Funder loans were converted to shares in Jaxsta Limited on 28 December 2019
(ii) Trade and Other Receivables:
$750,000 Other receivables were converted to shares in Jaxsta Limited on 28 December 2019.
Note 21. Reserves
Share based payment reserve
Balance at the beginning of the year
CEO share options expense
Lead Manager options expense
Employee option plan
Employee incentive option plan expense
Data Partner warrants granted
Balance at the end of the year
30 June 2019
$
30 June 2018
$
596,816
-
66,903
61,000
280,313
11,341
177,259
596,816
-
-
-
-
-
-
-
-
50
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
The following share-based payment arrangements existed as at 30 June 2019
CEO Options
Number of Options
Exercise
Price ($)
Granted Date
Status
Vesting Conditions
Expiry Date
Note
Number of Options
Exercise
Price ($)
Granted Date
Status
Vesting Conditions
Expiry Date
Note
20,000,000
20,000,000
0.20
Total CEO Options
16-Nov-18
Granted
vest in tranches of 1,000,000
options for every share price
increase of $0.10 from the
initial price of $0.20 on a
trailing 30-day VWAP basis
16-Nov-23
1 & 2
131,250
0.651
28-Mar-19
Granted
169,712
0.651
28-Mar-19
Granted
Lead Manager (share issue)
Number of Options
Exercise
Price ($)
Granted Date
Status
Vesting Conditions
Expiry Date
Note
Subject to exercise
restrictions from grant date
to 2nd anniversary
Subject to exercise
restrictions from grant date
to 3rd anniversary
Subject to exercise
restrictions from grant date
to 4th anniversary
28-Mar-25
28-Mar-25
28-Mar-25
4
4
4
333,333
0.30
16-Nov-18
Granted
333,333
0.30
16-Nov-18
Granted
one third of the Options will
vest when the Share price
hits $0.30 for a period of 5
consecutive trading days
one third of the Options will
vest when the Share price
hits $0.40 for a period of 5
consecutive trading days
the final third of the Options
will vest when the Share
price his $0.50 for a period
of 5 consecutive trading
days
16-Nov-23
16-Nov-23
16-Nov-23
3
3
3
333,333
1,000,000
Employee Options
Number of Options
345,000
345,000
25,000
25,000
150,000
100,000
990,000
0.30
16-Nov-18
Granted
Total Lead Manager Options
Exercise
Price ($)
-
-
-
-
-
-
Granted Date
Status
Vesting Conditions
Expiry Date
Note
28-Mar-19
Vested
28-Mar-19
Granted
28-Mar-19
Granted
28-Mar-19
Vested
28-Mar-19
Vested
28-Mar-19
Vested
100% exercisable from 1 May
2019 until expiry
100% exercisable after 28 the
March 2020 until expiry
100% exercisable after 31
October 2019 until expiry
100% exercisable from 1 May
2019 until expiry
100% exercisable after 1 May
2019
100% exercisable after 1 May
2019
28-Mar-26
1 & 2
28-Mar-26
1 & 2
28-Mar-26
1 & 2
28-Mar-26
1 & 2
28-Mar-26
1 & 2
28-Mar-20
1 & 2
Total Employee Options
Employee Incentive Options
Number of Options
Exercise
Price ($)
Granted Date
Status
Vesting Conditions
Expiry Date
Note
169,711
0.651
28-Mar-19
Granted
Subject to exercise
restrictions from grant date
to 1st anniversary
28-Mar-25
4
131,250
601,923
0.651
28-Mar-19
Granted
Total Employee Incentive Options
Data Partner Warrants
Number of Warrants
Exercise
Price ($)
Granted Date
Status
Vesting Conditions
Expiry Date
Note
713,105
0.01
14-Mar-19
Granted
713,105
713,105
713,105
675,573
675,573
0.01
14-Mar-19
Granted
0.01
14-Mar-19
Granted
0.01
14-Mar-19
Granted
0.01
15-Mar-19
Granted
0.01
15-Mar-19
Granted
562,978
0.01
18-Jun-19
Granted
562,978
5,329,522
0.01
18-Jun-19
Granted
Total Data Partner Warrants
Vesting (on the last day of
the month) 12 months after
date of issue and subject to
other non-market vesting
conditions
Vesting (on the last day of
the month) 12 months after
date of issue
Vesting 24 months after
date of issue
Vesting 24 months after
date of issue and subject to
other non-market vesting
conditions
Vesting 12 months after date
of issue
Vesting 24 months after
date of issue
Vesting (on the last day of
the month preceeding) 12
months after date of issue
Vesting (on the last day of
the month preceeding) 24
months after date of issue
14-Mar-26
14-Mar-26
14-Mar-26
14-Mar-26
15-Mar-27
15-Mar-28
18-Jun-27
18-Jun-28
5
5
5
5
5
5
5
5
Notes:
1. Issued under the terms of Incentive Option Plan (Jaxsta). Refer to the table for terms.
2. Vesting basis to remain employed by Jaxsta at vesting date (ranging from 0 to 1,825 days).
3. Issued pursuant to the 2018 rights issue document dated 28 December 2018.
4. Issued pursuant to the 2019 rights issue document dated 28 March 2019.
5 Warrants to various data partners between 14 March 19 and 18 June 2019 .
All options and warrants granted are in respect of ordinary shares in Jaxsta Limited and confer a right of one ordinary
share for each option held.
51
52
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Movement in the number of share options on issue
Total options and warrants
Outstanding at the beginning of the year
Granted
Forfeited
Exercised
Expired
Outstanding at year end
Exercisable at year end
2019
Number of
Options &
warrants
-
27,921,444
-
-
-
27,921,444
27,921,444
Weighted
Average
Exercise
Price ($)
-
0.170
-
-
-
0.170
0.170
Options Reserve
The fair value of issued CEO share options is calculated to be $0.033 per option totalling $660,000 (2018: $NIL). The
number of options granted during the year pursuant to the Incentive Option Plan (Jaxsta) was 20,000,000 (2018: (NIL).
The fair value of issued Employee share options is calculated to be $0.39 per option totalling $386,100 (2018: $NIL). The
number of options granted during the year pursuant to the Employee Incentive Option Plan (Jaxsta) was 990,000 (2018:
(NIL).
The fair value of issued Employee Incentive share options is calculated to be $0.137 per option totalling $82,463 (2018:
$NIL). The number of options granted during the year pursuant to the Employee Incentive Option Plan (Jaxsta) was
601,923 (2018: (NIL).
The fair value of issued Lead Manager share options is calculated to be $0.061 per option totalling $61,000 (2018: $NIL).
The number of options granted during the year pursuant to the ESOP was 1,000,000 (2018: (NIL)
The fair value of issued Data partner Warrants is calculated to be $0.137 per warrant totalling $1,033,627 (2018: $NIL).
The number of warrants granted during the year pursuant to the Incentive Option Plan (Jaxsta) was 5,329,521 (2018:
(NIL).
In March 2019, the company granted Senior Employees 990,000 options with an exercise price of Nil, exercisable 34
days from grant date. The value of these options is $386,100.
Included under employees and contractor costs in the statement of profit and loss and other comprehensive income is
a share-based payments expense of $358,557 (2018: NIL), representing the expense for the current reporting period.
Included under product development expense in the statement of profit and loss and other comprehensive income is a
share-based payments expense of $177,259 (2018: NIL), representing the expense for the current reporting period.
Included in Equity as a cost of capital raising is share based payment expense of $61,000 for Lead Manager Options.
The value of share options issued during the financial year has been calculated by using a binomial option pricing
model applying the following inputs:
Exercise prices
Underlying share prices
Days to expiration
Days to vesting
Expected share price volatility
Risk free interest rate
CEO Options
$0.20
$0.20
1,825
0 to 1,825
50%
2.02%
Lead
Manager
$0.30
$0.20
1,825
0 to 1,825
50%
2.02%
Employee
Options
$0.00
$0.39
365 to 2555
34 to 272
50%
2.02%
Employee
Incentive
Data
Partner
$0.651
$0.01
$0.39 $0.18 - $0.24
2,190 2555 to 3285
365 to 730
50%
2.02%
365 to 1367
50%
2.02%
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Expected share price volatility has been based using comparable entities listed on the ASX which operate in the same
industry group as Jaxsta Limited (Jaxsta). The Directors believed this to be fair representation of Jaxsta expected
volatility in the absence of volatility.
The life of the options is based on the contracted expiry date.
Note 22. Related Party Disclosures
(a) The Group’s main related parties are as follows:
Entities exercising control over the Group:
(i) The ultimate parent entity that exercises control over the Group is Jaxsta Limited, which is incorporated in Australia.
(ii) Key management personnel:
Any person(s) having authority and responsibility for planning, directing and controlling the activities of the entity,
directly or indirectly, including any director (whether executive or otherwise) of that entity, are considered key
management personnel. For details of disclosures relating to key management personnel, refer to Note 7.
(b) Transactions with related parties
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
The following transactions occurred with related parties:
Trade and other receivables
Loan to other related party - Mobilarm Ltd
Beginning of the year
Loans advanced
Loan repayment received
30 June 2019
$
750,000
-
(750,000)
30 June 2018
$
-
750,000
-
750,000
End of the year
This loan is interest free, unsecured and at call. It was extinguished in cash on the acquisition of Jaxsta Holdings Pty
Limited on 28 December 2018.
-
Loans and Borrowings
Loan from other related party -New Holland Pty Ltd
Beginning of the year
Loans advanced
Loan repayment
End of the year
This loan was interest free and was repaid in cash in January 2019.
30 June 2019
$
30 June 2018
$
272,680
-
(272,680)
-
94,845
177,835
-
272,680
30 June 2019
$
30 June 2018
$
Loan from other related party - Marine Rescue Technologies Ltd
200,000
Beginning of the year
349,758
Loans advanced
-
Loan repayment
549,758
End of the year
This loan was interest free and $715,695 was repaid in cash in January 2019 with the remaining balance settled through
the issue of shares in Jaxsta Limited.
549,758
465,654
(1,015,412)
-
53
54
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Loan from other key management personnel related
entities - Jacqui Louez Schoorl and Louis Schoorl
Beginning of the year
Loans advanced
Loan repayment
End of the year
30 June 2019
$
30 June 2018
$
300,000
-
(300,000)
-
-
300,000
-
300,000
This loan agreement with an interest rate of 0%.The loan was repaid by the issue of shares in Jaxsta Limited.
The following related party transactions occurred during the financial period:
Brett Cottle received director fees of $60,000 for the financial year, any other transactions throughout the year relate to
reimbursements for expenses incurred by Jaxsta Ltd or his related entities on behalf of the Group.
Jorge Nigaglioni received a salary and directors fee of $30,000 for the financial year and is paid to himself. Any other
transactions throughout the year relate to reimbursements for expenses incurred by Jaxsta Ltd or his related entities
on behalf of the Group.
Linda Jenkinson received directors fee of $32,850 for the financial year and is paid to herself. Any other transactions
throughout the year relate to reimbursements for expenses incurred by Jaxsta Ltd or his related entities on behalf of
the Group.
Launa Inman received directors fee of $10,950 for the financial year and is paid to herself. Any other transactions
throughout the year relate to reimbursements for expenses incurred by Jaxsta Ltd or her related entities on behalf of
the Group.
Jacqui Louez Schoorl received a salary and directors fee of $221,159 for the financial year and is paid to herself,
accordingly. Any other transactions throughout the year relate to reimbursements for expenses incurred by her or her
related entities on behalf of the Group.
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
Note 23. Financial Risk Management
The group's financial instruments consist mainly of deposits with banks, accounts receivable and payable.
The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in the
accounting policies to these financial statements, are as follows:
Financial assets
Cash and cash equivalents
Loans and receivables
MRT receivables
Total financial assets
Financial liabilities
Financial liabilities at amortised cost:
Trade and other payables
Loans and borrowings
Total financial liabilities
Note
30 June 2019
$
30 June 2018
$
11
12
12
16
17
2,452,760
81,435
3,800,000
6,334,195
46,299
752,131
-
798,430
30 June 2019
$
30 June 2018
$
599,692
26,597
626,289
706,796
2,622,437
3,329,233
Financial Risk Management Policies
The directors overall risk management strategy seeks to assist the group in meeting its financial targets, while
minimising potential adverse effects on financial performance. Risk management policies are approved and reviewed
by the Board of Directors on a regular basis. These include the credit risk policies and future cash flow requirements.
Specific Financial Risk Exposures and Management
The main risks the group is exposed to through its financial instruments are credit risk, liquidity risk and market risk
consisting of interest rate risk, foreign currency risk and price risk.
There have been no substantive changes in the types of risks the group is exposed to, how these risks arise, or the
Board’s objectives, policies and processes for managing or measuring the risks from the previous period.
(a) Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of
contract obligations that could lead to a financial loss to the group.
Credit risk is managed through the maintenance of procedures (such as the utilisation of systems for the approval,
granting and renewal of credit limits, regular monitoring of exposures against such limits and monitoring of the
financial stability of significant customers and counterparties), ensuring to the extent possible that customers and
counterparties to transactions are of sound credit worthiness. Such monitoring is used in assessing receivables for
impairment. Depending on the division within the Group, credit terms are generally 14 to 30 days from the invoice date.
Risk is also minimised through investing surplus funds in financial institutions that maintain a high credit rating.
Credit risk exposures
The maximum exposure to credit risk by class of recognised financial assets at the end of the reporting period
excluding the value of any collateral or other security held, is equivalent to the carrying amount (net of any provisions)
as presented in the statement of financial position. Credit risk also arises through the provision of financial
guarantees, as approved at board level, given to parties securing the liabilities of certain subsidiaries.
Other receivables is deferred consideration in relation to the sale of the MRT business which is due from Secure2go
Group Ltd on or before 28 December 2020. Refer to Events After the Reporting Period in Note 30.
The group has a significant concentrations of credit risk with MRT receivables. Details with respect to credit risk of
trade and other receivables are provided in Note 12 and Note 30.
Trade and other receivables that are neither past due nor impaired are considered to be high credit quality. Aggregated
of such amounts are detailed in Note 12.
Credit risk related to balances with banks and other financial institutions is managed by the group in accordance with
approved board policy. Such policy requires that surplus funds are only invested with major financial institutions.
(b) Liquidity risk
Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise
meeting its obligations related to financial liabilities. The Group manages this risk through the following mechanisms:
- preparing forward-looking cash flow analyses in relation to its operational, investing and financing activities;
- monitoring undrawn credit facilities;
- maintaining a reputable credit profile;
- managing credit risk related to financial assets;
- only investing surplus cash with major financial institutions; and
- comparing the maturity profile of financial liabilities with the realisation profile of financial assets.
The table below reflects an undiscounted contractual maturity analysis for financial liabilities.
Cash flows realised from financial assets reflect management’s expectation as to the timing of realisation. Actual
timing may therefore differ from that disclosed. The timing of cash flows presented in the table to settle financial
liabilities reflects the earliest contractual settlement dates and does not reflect management’s expectations that
banking facilities will be rolled forward.
55
56
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Financial liability and financial asset maturity analysis
Within 1 year
1 to 5 years
Total
2019
$
2018
$
2019
$
2018
$
2019
$
2018
$
Financial liabilities due for payment
Loans and borrowings
Trade and other payables
Total contractual outflows
26,597
599,692
2,622,437
706,796
626,289
3,329,233
Total expected outflows
626,289
3,329,233
-
-
-
-
Within 1 year
1 to 5 years
2019
$
2018
$
2019
$
2018
$
Financial assets cash flows realisable
Cash and cash equivalents
Trade and loan receivables
Total anticipated inflows
Net (outflow)/inflow on
financial instruments
2,452,760
705,248
3,158,008
3,158,008
46,299
752,131
798,430
-
3,176,187
3,176,187
798,430
3,176,187
-
-
-
-
-
-
-
-
26,597
599,692
626,289
2,622,437
706,796
3,329,233
626,289
3,329,233
Total
2019
$
2018
$
2,452,760
3,881,435
6,334,195
46,299
752,131
798,430
6,334,195
798,430
(b) Market risk
(i) Interest rate risk
Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end of the reporting
period whereby a future change in interest rates will affect future cash flows or the fair value of fixed rate financial
instruments.
The financial instruments that primarily expose the Group to interest rate risk are borrowings, foreign currency, and
cash and cash equivalents.
(ii) Foreign exchange risk
Other price risk relates to the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market prices largely due to demand and supply factors (other than those arising from interest
rate risk or foreign currency risk) for commodities.
Sensitivity analysis
The following table illustrates sensitivities to the Group’s exposures to changes in interest rates, exchange rates and
commodity and equity prices. The table indicates the impact of how profit and equity values reported at the end of the
reporting period would have been affected by changes in the relevant risk variable that management considers to be
reasonably possible. These sensitivities assume that the movement in a particular variable is independent of other
variables.
Fair Values
Fair value estimation
The fair values of financial assets and financial liabilities are presented in the following table and can be compared to
their carrying amounts as presented in the statement of financial position. Refer to Note 24 for detailed disclosures
regarding the fair value measurement of the Group’s financial assets and financial liabilities.
These sensitivities assume that the movement in a particular variable is independent of other variables.
Financial assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total financial assets
Financial liabilities
Trade and other payables
Loans and borrowings
Total financial liabilities
2019
2018
Note
Net carrying
value $
Net fair
value $
Net
carrying
value $
Net fair
value $
11
12
15
2,452,760
3,881,435
26,400
2,452,760
3,881,435
26,400
46,299
752,131
26,400
46,299
752,131
26,400
6,360,595
6,360,595
824,830
824,830
2019
2018
Note
Net carrying
value $
Net fair
value $
Net
carrying
value $
Net fair
value $
16
17
599,692
26,597
599,692
26,597
706,796
2,622,437
706,796
2,622,437
626,289
626,289
3,329,233
3,329,233
Cash and cash equivalents, trade and other receivables, loans and advances and trade and other payables are short-
term instruments in nature whose carrying amounts are equivalent to their fair values.
Note 24. Fair Value Measurements
The carrying amounts of cash and cash equivalents, trade and other receivables, loans and advances and trade and
other payables are carried at their amortised cost less any impairment. The fair value of financial liabilities is
estimated by discounting the remaining contractual maturities at the current interest rate that is valuable for similar
financial liabilities.
Note 25. Contingent Assets and Contingent Liabilities
There were no contingent assets or contingent liabilities which would have a material effect on the consolidated
entity's financial statements as at 30 June 2019 (2018: $ nil).
Year ended 30 June 2019
+/- 1% in interest rates
+/-
Profit
$
1
Equity
$
1
Note 26. Contractual Commitments
Jaxsta Limited had no contractual commitments as at 30 June 2019,
Note 27. Parent Entity Information
Year ended 30 June 2018
+/- 1% in interest rates
There have been no changes in any of the methods or assumptions used to prepare the above sensitivity analysis from
the prior year.
+/-
463
463
Parent entity information
Parent entity financial information relates to Jaxsta Limited (formerly Mobilarm Limited). As detailed in note 2, Jaxsta
Limited is " the legal parent " of the consolidated entity with effect from 28 December 2018. The information for the
periods represents the standalone financial information of the parent entity.
57
58
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
The comparative financial information are not part of the consolidated entity's financial position or performance for
the 30 June 2018.
Statement of financial position
Assets
Current assets
Non - current
TOTAL ASSETS
LIABILITIES
Current liabilities
Non-current
TOTAL LIAIBLITIES
Equity
Issued capital
Retained earnings
Option reserve
TOTAL EQUITY
Statement of profit or loss and other comprehensive income
Total loss
Total comprehensive loss
30 June 2019
$
3,352,624
30,822,298
34,174,922
43,109
-
43,109
64,828,062
(31,293,066)
596,816
34,131,813
30 June 2019
$
(1,319,520)
(1,319,520)
30 June 2018
$
-
10,800,492
10,800,492
300,000
1,500,000
1,800,000
7,974,578
1,025,914
-
9,000,492
30 June 2018
$
-
-
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity has no guarantees in relation to the debts of its subsidiaries as at 30 June 2019 and 30 June 2018.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2019 and 30 June 2018.
Contractual commitments
The parent entity had no contractual commitments as at 30 June 2019 and 30 June 2018.
Note 28. Interests in subsidiaries
Information about Principal Subsidiaries
The subsidiaries listed below have share capital consisting solely of ordinary shares which are held directly by the
Group. The proportion of ownership interests held equals the voting rights held by the Group. Each subsidiary’s
principal place of business is also its country of incorporation.
Name of
Subsidiary
Jaxsta Holdings Pty Ltd
Jaxsta Enterprise Pty Ltd
Jaxsta Inc.
Country of Incorporation
Australia
Australia
United States of America
Ownership Interest Held
by the Group
2019
100%
100%
100%
2018
100%
100%
Note 29. Registered Office
The registered office of the company is:
Level 1/ 113-115 Oxford Street
Darlinghurst NSW 2010
The principal place of business is:
Level 1/ 113-115 Oxford Street
Darlinghurst NSW 2010
Note 30. Events After the Reporting Period
Other than the events described below, there are no other events or circumstances have arisen that would require
disclosure in the financial report.
Other receivable $4.6m in relation to sale of the MRT business which is due from Secure2go Group Limited.
Jaxsta (formerly Mobilarm Limited) entered into a Share Sale and Purchase Agreement with Secure2Go Group Limited
ACN 612 127 867 (‘Secure2Go’) on or about 18 May 2018 (‘SSPA’) under which Mobilarm Limited sold all of the shares and
other securities in its subsidiary, Marine Rescue Technologies Limited CRN 4202403 (‘MRT’) to Secure2Go, or its
nominee JJC Capital Pte Ltd (herein referred to as the ‘Disposal’).
The Company sought and received shareholder approval for the Disposal at the 2018 EGM. The material terms of the
Disposal were set out in the ‘Notice of General Meeting’ dated 16 July 2018. The SSPA was amended a number of times by
the following documents entered into between the Company, Secure2Go and others:
- a first amendment agreement dated on or about 22 May 2018 amending, among other things, the payment terms;
- a side letter dated 17 November 2018 in relation to the discharge of the completion payment;
- a third amendment agreement dated 26 April 2019 which, subject to shareholder approval, reduced the outstanding
deferred consideration receivable by the Company; and
- a fourth amendment agreement dated 28 June 2019 which, subject to shareholder approval, extended the payment
date of the outstanding deferred consideration.
The Company has received $1,376,187 in connection with the Disposal. However, as the outstanding deferred
consideration was not paid in accordance with the terms of the SSPA as amended by the third and fourth amendment
agreements, the original terms of the SSPA (i.e., before such amendments were made) remained binding on the parties
(the ‘Current Terms’). Under such terms, Secure2Go is required to make the following payments of deferred
consideration to Jaxsta:
- $623,813 on 28 December 2019, being the first anniversary of the date of completion of the Disposal (or any earlier
date Secure2Go chooses); and
- $4,000,000 on 28 December 2020, being the second anniversary of the date of completion of the Disposal (or any
earlier date Secure2Go chooses),
(together, the ‘Deferred Payments’).
Proposed further amendments to the SSPA
The Company, Secure2Go and others have entered into a fifth amendment agreement to the SSPA on 25 September
2019 (‘Fifth SSPA Amendment Agreement’).
The Fifth SSPA Amendment Agreement, which remains subject to shareholder approval in accordance with the Listing
Rules, brings forward the due date for each Deferred Payment and, in consideration for the same, reduces the aggregate
amount of the Deferred Payments. The key terms are:
1) (effective date) the material terms of the Fifth SSPA Amendment Agreement will not become binding on the parties
unless and until shareholder approval is received by Jaxsta;
59
60
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
Jaxsta Limited
2019 Annual Report | Notes to the Consolidated Financial Statements
For the year ended 30 June 2019
For the year ended 30 June 2019
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Director’s Declaration
2019 Annual Report | Director’s Declaration
2) (discount) the aggregate consideration for the Disposal is reduced from $6,000,000 (plus VAT, if applicable) to
$4,376,187 (plus VAT, if applicable), including $1,376,187 which the Company has already received;
Director’s Declaration
3) (first payment) Secure2Go must pay $1,500,000 into escrow immediately upon signing the Fifth SSPA Amendment
Agreement and such amount will be released to Jaxsta as the first Deferred Payment promptly upon receipt of
shareholder approval; and
4) (second payment) the balance of the Deferred Payments will be treated as follows:
a) if $1,700,000 is received by Jaxsta by no later than 31st March 2020, such payment will be considered full and final
satisfaction of Secure2Go’s obligations to pay the purchase price for the Disposal which will secure an early repayment
discount of $1,423,813; or
b) if the payment referred to in 4(a) above is not received by the required date, $2,300,000 will be due no later than
31st December 2020 and, upon receipt, such payment will be considered full and final satisfaction of Secure2Go’s
obligations to pay the purchase price for the Disposal and will secure an early repayment discount of $823,813.
(collectively. 'the Proposed Amendments’).
In circumstances where shareholder approval is not obtained by Jaxsta by at its next general meeting, the purchase
price and payment terms applicable to the Disposal will revert to the Current Terms.
Note 31. Difference to Preliminary Financial Report and Appendix 4E
Since the lodgement of the company's Appendix 4E and the Preliminary Financial Report with the ASX on 30 August
2019, Jaxsta has signed an agreement with Secure2Go as detailed in Note 30 - Events After the Reporting Period. The
revised terms agreed with Secure2Go have resulted in impairment of the Receivable from Secure2Go by $823,813. This
impairment was not included in the Preliminary Financial Report. The difference between the Preliminary Financial
Report and this Final Audited Financial Report are summarised below:
Loss after income tax expense for the year
attributable to the owners of Jaxsta Limited
Net Assets
Preliminary
Financial
Report
Final Audited
Financial
Report
Impairment
(20,908,211)
(823,813)
(20,084,398)
9,259,068
(823,813)
10,082,881
In accordance with a resolution of the Directors of Jaxsta Limited, the Directors of Jaxsta declare
that:
•
the consolidated financial statements and notes, as set out on pages 25 to 61, are in accordance
with the Corporations Act 2001 (Cth) and:
o comply with the Australian Accounting Standards and the Corporations Regulations 2001,
which, as stated in accounting policy Note 2 to the financial statements, constitutes
compliance with International Financial Reporting Standards; and
o give a true and fair view of the financial position as at 30 June 2019 and of the performance
for the year ended on that date of the consolidated Group;
•
•
in the Directors’ opinion there are reasonable grounds to believe that Jaxsta and consolidated
entity will be able to pay its debts as and when they become due and payable; and
the Directors have been given the declarations required by s295A of the Corporations Act 2001
(Cth) from the Chief Executive Officer and Chief Financial Operations Officer.
On behalf of the Directors
Jacqueline Louez Schoorl
Executive Director
26 September 2019
Sydney, New South Wales
61
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Jaxsta Limited
2019 Annual Report | Independent Auditor’s Report
Jaxsta Limited
2019 Annual Report | Independent Auditor’s Report
Auditor’s Independence Declaration
Independent Auditor’s Report
AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE
CORPORATIONS ACT 2001 TO THE DIRECTORS OF JAXSTA LIMITED
We declare that, to the best of our knowledge and belief, during the year ended 30 June 2019 there have
been:
i.
ii.
no contraventions of the auditors’ independence requirements as set out in the Corporations Act 2001
in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
Walker Wayland Audit (WA) Pty Ltd
Wali Aziz
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF JAXSTA LIMITED
REPORT ON THE FINANCIAL REPORT
OPINION
We have audited the accompanying financial report of Jaxsta Limited (the Group) and its controlled
entities which comprises the consolidated statement of financial position as at 30 June 2019, 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, notes
comprising a summary of significant accounting policies and other explanatory information, and the
directors’ declaration.
In our opinion:
(a) the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
I.
II.
giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its
performance for the year ended on that date; and
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 2.
Consultant – Registered Company Auditor
Material Uncertainty Regarding Going Concern
Dated this 26th day of September 2019, Sydney
Without modifying our opinion, we draw attention to Note 2b) “Going Concern basis of Accounting” in
the financial report, which indicates:
• The Group incurred a Loss after tax for the year ended 30 June 2019 was $20,084,398 which
includes listing expenses of $14,227,655.
• The Group incurred a Net cash outflow for the year ended 30 June 2019 of $6,202,539.
• The Group is in the process of transitioning from a start-up/development business to a
commercialised business with the intention of deriving product sales.
• The Group has not derived product sales to date.
These conditions, indicate the existence of material uncertainties that may cast significant doubt about
the Group’s ability to continue as a going concern and therefore, the Group may be unable to realise
its assets and discharge its liabilities in the normal course of business at the amounts stated.
The ability of the entity to continue as a going concern is dependent upon the following:
• Launching the final platform website and the subsequent derivation of subscription-based
sales.
• Collecting the MRT receivable in part or in full.
• Raising additional funds from equity and debt capital.
• Reducing discretionary overhead expenditure assuming the above three matters do not
eventuate.
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Jaxsta Limited
2019 Annual Report | Independent Auditor’s Report
Jaxsta Limited
2019 Annual Report | Independent Auditor’s Report
BASIS FOR OPINION
We conducted our audit in accordance with Australian Auditing Standards. Those standards require
that we comply with relevant ethical requirements relating to audit engagements and plan and perform
the audit to obtain reasonable assurance about whether the financial report is free from material
misstatement. Our responsibilities under those standards are further described in the Auditor’s
responsibility section of our report. We are independent of the Group in accordance with the
Corporations Act 2001 and the ethical requirements of the Accounting Professional 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.
KEY AUDIT MATTERS
The key audit matters are the matters that, in our professional judgement, were of most significance in
our audit of the financial report for the current year. The 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 matters
Accounting for the reverse acquisition
On 28th December 2018, Mobilarm Limited
(‘Mobilarm’) (now renamed Jaxsta Limited)
acquired 100% of the share capital of Jaxsta
Holdings Pty Ltd (Jaxsta Holdings). The
acquisition
in Jaxsta’s original
shareholders holding a controlling share in
Jaxsta Limited (formerly Mobilarm Limited).
The acquisition has been accounted for as a
share-based payment under AASB 2 Share
based payments and the principles of reverse
acquisition have been applied.
resulted
The accounting for the reverse acquisition is a
key audit matter due to the accounting
complexity of the transaction, and the level of
audit effort involved.
judgement was required
to
Management
determine that Mobilarm did not meet the
definition of a ‘business’ under AASB 3
Business Combinations and could not be
accounted for as a business combination.
Additionally, Management applied judgement
to conclude that the basis of preparation of the
financial statements, including comparative
information, should be analogised to that of a
reverse acquisition.
No goodwill was
transaction.
recognised on
the
How our audit addressed the key audit matter
Our procedures included, amongst others:
• Reviewed the sale and purchase agreements to
relevant
requirements of
assess
accounting standards, including interpretation
guidance and authoritative support.
the
the
These included:
•
•
•
the use of reverse acquisition accounting as the
basis of preparation of the financial statements;
the determination that the transaction was a
share-based payment, and
the treatment of the specific costs incurred as
part of the reverse listing transaction as share-
based payments.
• We reviewed the shareholdings of Jaxsta
Limited, the composition of the new Board and
Management to determine who has control of
the group and who is the accounting acquirer.
• We
the
also
reviewed
acquisition
accounting
recognition,
measurement, presentation & disclosure of the
reverse
the
consolidated financial statements of Jaxsta
the
included
Limited.
consolidation entries of all the entities in the new
group, the completeness of the updated equity
structure, the treatment of the excess of the
deemed acquisition cost as an expense.
reviewing
This
in
Key audit matters
Goodwill – impairment testing (Note 14)
The Group has recorded intangible assets
with a carrying value of $4,393,845 (which
the
includes goodwill of $4,025,904) on
Statement of Financial Position as at 30 June
2019 as disclosed in Note 14 “Intangible
Assets.”
AASB 136 Impairment of Assets requires
intangible assets with indefinite useful lives,
such as goodwill, to be tested for impairment
annually. It also requires intangible assets
with definite useful lives such as platform
development costs,
for
indicators of impairment.
to be reviewed
This area is a key audit matter due to the
management judgement and assumptions
applied in preparing a fair value less costs to
sell model to satisfy the impairment test.
The market capitalisation less selling costs of
Jaxsta Limited has been used as the fair value
less costs to sell. The market capitalisation
exceeds the carrying value of goodwill at year
end, accordingly no impairment write-down
has been recognised for the year ended 30
June 2019.
Other receivable (MRT) – existence and
recoverability (Note 12)
total consideration
The Group has a
receivable outstanding from the sale of the
MRT Business amounting to $3,800,000 as
disclosed in Note 12 which includes an
$823,813 impairment provision recognised for
the year ended 30 June 2019.
The total receivable is considered to be a key
audit matter as it is material and significant to
the Group’s statement of financial position and
future cash flows.
How our audit addressed the key audit matter
Our procedures included, amongst others:
• Reviewed managements fair value less costs to
sell memorandum
• Tested the mathematical accuracy of the fair
value less costs to sell model;
• Agreed the market price of the Company’s
quoted securities to the ASX at year end and as
at the date of this report
• Agreed the quoted securities to the company’s
share registry records
• Considered the liquidity and tradability of the
shares
• Evaluated the fair value less costs to sell model
requirements of AASB 136
against
the
Impairment of Assets
• Assessed
the
disclosures within the financial report
the adequacy of
related
Our procedures included, amongst others:
• Reviewed managements memorandum
• Confirmed the balance as at 30 June 2019 with
the purchaser - MRT, in addition to confirming
the payment terms
• Reviewed the sale and purchase agreement to
ensure the receivable is consistent with that
document
• Reviewed board minutes and latest amended
deed to confirm any renegotiated amounts
• Obtained documentation to assess the financial
position of the MRT purchaser in order to
assess recoverability
• Discussed the recoverability of the receivable
the board and audit
with management,
committee
• Assessed the adequacy of related disclosures,
including current and non-current classification
within the financial statements;
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Jaxsta Limited
2019 Annual Report | Independent Auditor’s Report
Jaxsta Limited
2019 Annual Report | Independent Auditor’s Report
Key audit matters
Share options and warrants (Note 21)
During the year ended 30 June 2019, the
Group has issued options and warrants to
directors, employees, and other service
providers resulting in an expense for the year
of $535,816. These options and warrants
have been accounted for in accordance with
AASB 2 “Share Based Payments.”
The accounting for share based payments is
a key audit matter because the expense
recognised incorporates a judgemental option
value. The Group valued the options, assisted
by an external expert, using the Black Scholes
model, where inputs such as volatility and risk-
free rate require judgement.
How our audit addressed the key audit matter
Our procedures included, amongst others:
• Compared the terms and conditions for a
sample of the options issued during the financial
year included in the expense calculations with
appropriate board minutes and letters of advice
to employees and service providers
• Obtained the Group’s expert’s options valuation
report and assessed the reasonableness of
selected inputs used in the valuation of the
share options using available supporting data.
Assessed the competency of the Group’s expert
including their experience and qualifications
• Assessed attributes, on a sample basis in
respect of the valuation of the share options.
Ascertained whether
these attributes were
appropriately included in the share option
valuation model, and the expense is recognised
over the appropriate vesting period
• Assessed the reasonableness of the fair value
the
calculation
calculation using the Black Scholes model
• Evaluated the adequacy of disclosures made by
re-performing
through
the Group in the financial report
OTHER INFORMATION
The directors are responsible for the other information. The other information comprises the information
included in the Group’s directors report for the year ended 30 June 2019, 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.
DIRECTORS’ RESPONSIBILTY FOR THE FINANCIAL REPORT
The directors of the Group are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australia Accounting Standards and the Corporations Act 2001 and
for such internal control as the directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement, whether due to fraud or
error. In Note 2, the directors also state, in accordance with Australian Accounting Standards 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 Group’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
67
AUDITOR’S RESPONSIBILITY
Our responsibility is to express an opinion on the financial report based on our audit. 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 than an audit conducted in
accordance with 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 scepticism 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 the internal controls 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 Group’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 Group’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 Group
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 Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group 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 controls 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.
68
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Jaxsta Limited
2019 Annual Report | Independent Auditor’s Report
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Additional Shareholder Information
2019 Annual Report | Additional Shareholder Information
REPORT ON THE REMUNERATION REPORT
We have audited the Remuneration Report included in the Directors’ Report on pages 16 to 23 for the
year ended 30 June 2019. The Directors of the Group are responsible for the preparation and
presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act
2001. Our responsibility is to express an opinion on the Remuneration Report, which based on our
audit, is in accordance with Australian Auditing Standards.
OPINION
In our opinion, the Remuneration Report of Jaxsta Limited for the year ended 30 June 2019, complies
with Section 300A of the Corporations Act 2001.
RESPONSIBILITIES
The directors of the Group are responsible for the preparation and presentation of the Remuneration
Report in accordance with Section 300A of the Corporations Act 2001. Our responsibility is to express
an opinion on the Remuneration Report, based on our audit conducted in accordance with Australia
Auditing Standards.
Walker Wayland Audit (WA) Pty Ltd
Wali Aziz
Consultant – Registered Company Auditor
Dated this 26th day of September 2019, Sydney
Additional Shareholder Information
Shareholder Information required by the Australian Securities Exchange Limited (‘ASX’) Listing Rules
and not disclosed elsewhere in the Report is set out below. The shareholder information is current
as at 31 July 2019.
Jaxsta Limited shares are traded on the ASX under the code ‘JXT’. Jaxsta’s securities are not traded
on any other exchange.
Share Registry
Registered Office
Principle Place of Business
Security Transfer Registrars
770 Canning Hwy
Applecross WA 6153
T: 1300 992 916 or +61 3
9628 2200 (International)
Level 1, 113-115 Oxford St
Darlinghurst NSW 2010
T: +61 2 8317 1000
Level 1, 113-115 Oxford St
Darlinghurst NSW 2010
T: +61 2 8317 1000
The details of Jaxsta’s Company Secretary, Shelley Burger, is set out in the Directors’ Report.
A review of the operations of Jaxsta and its other Group members for the reporting period is set out
in the Directors’ Report.
Corporate Governance
In accordance with the 3rd edition ASX Corporate Governance Council’s Principles and
Recommendations, the 2019 Corporate Governance Statement, as approved by the Board, is
available on Jaxsta’s website at: https://jaxsta.com/info/governance-documents. The Corporate
Governance Statement sets out the extent to which Jaxsta has followed the ASX Corporate
Governance Council’s 29 Recommendations during the 2019 financial year.
Substantial Shareholders of Fully Paid Ordinary Shares
The number of securities held by substantial shareholders and their associates, as disclosed to the
ASX are set out below:
Name
Jacqueline Samantha Louez Schoorl
Louis Schoorl
AustralianSuper Pty Ltd
Jaxsta Limited
Number
25,920,004
25,920,004
14,383,332
87,593,950
%
11.88
11.88
6.59
37.87
69
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Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Additional Shareholder Information
2019 Annual Report | Additional Shareholder Information
Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Additional Shareholder Information
2019 Annual Report | Additional Shareholder Information
Distribution of Security Holders and Holdings
Twenty Largest Shareholders
Fully Paid Ordinary Shares
No. Name
No. of shares
Range
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Total
Options
Range
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Total
Warrants
Range
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Total
Ordinary Shares
28,887
764,918
1,621,955
10,287,977
%
0.01
0.33
0.70
4.45
218,623,164
94.51
231,326,901 100.00
Number of Holders
%
58
259
188
282
130
6.32
28.24
20.50
30.75
14.18
917 100.00
Options
%
Number of Holders
%
-
-
-
-
-
-
90,000
0.40
22,501,923
99.60
22,591,923
100.00
-
-
-
1
-
-
-
11.11
10
88.89
11 100.00
Warrants
%
Number of Holders
%
-
-
-
-
-
-
-
-
5,798,669
100%
5,798,669
100%
-
-
-
-
4
4
-
-
-
-
100%
100%
The number of shareholders holding less than a marketable parcel of ordinary shares is 156 based on
Jaxsta’s closing share price of $0.21, on 31 July 2019.
1
2
3.
4
5
6
7
8
9
SCHOORL JACQUELINE S L
SCHOORL LOUIS
GLENEAGLE SEC NOM PL
PROTASIUK PATRYCJA D
HSBC CUSTODY NOM AUST LTD
GLENEAGLE SEC NOM PL
JJC CAP PTE LTD
VERHEGGEN MELANIE T
J P MORGAN NOM AUST PL
10 MERRILL LYNCH AUST NOM PL
11
12
13
14
15
16
17
18
19
20
VERHEGGEN MELANIE T
CITICORP NOM PL
BLAZZED PL
VALUE NOM PL
SPINITE PL
JUNIOR JAY PL
SARGON CT PL
HASLER GARY DARREN
NEWD CORP PL
HSBC CUSTODY NOM AUST LTD
Total
Balance of Register
Grand Total
Escrowed Securities
Fully Paid Ordinary Shares
25,920,004
25,920,000
15,400,000
12,386,322
12,063,549
11,580,470
10,000,000
9,543,994
8,334,721
7,968,362
5,618,455
5,123,908
5,044,016
4,209,285
3,900,000
3,181,489
2,950,000
2,257,144
2,065,220
2,004,750
%
11.20
11.20
6.66
5.35
5.21
5.01
4.32
4.13
3.60
3.44
2.43
2.22
2.18
1.82
1.69
1.38
1.28
0.98
0.89
0.87
175,471,689
55,855,212
231,326,901
75.86
24.14
100
Jaxsta has 87,593,951 fully paid ordinary shares that are currently the subject of escrow
arrangements as detailed below:
•
•
86,760,617 shares are subject to escrow for 24 months from date of re-quotation of Jaxsta
shares on ASX. Jaxsta shares were re-instated to the official list of the ASX on 28 December 2018;
and
833,334 shares are subject to escrow until 28 August 2019.
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Jaxsta Limited
Jaxsta Limited
2019 Annual Report | Additional Shareholder Information
2019 Annual Report | Additional Shareholder Information
Options
There are 21,000,000 options subject to escrow for 24 months from date of re-quotation of Jaxsta
shares on ASX. Jaxsta shares were re-instated to the official list of the ASX on 28 December 2018.
Unquoted securities
Options
Jaxsta has issued 21,591,923 options at various exercise prices and expiry dates under the Jaxsta
Incentive Options Plan. The Jaxsta Incentive Options Plan was approved by shareholders in general
meeting on 17 August 2018.
Jaxsta has issued 1,000,000 options to Bell Potter Securities Limited which are exercisable at A$0.30
per option and will expire at 5:00pm (WST) on 16 November 2023.
Warrants
Jaxsta has issued 5,798,669 unlisted warrants to four warrant holders and remain unexercised.
Details of holders of 20% or more of the warrants are as follows:
Name
Universal Music Investments
Warner Music Inc.
Other holders
Total
Number
2,852,420
1,351,146
1,595,103
%
49.19
23.30
27.51
5,798,669
100.00
On Market Buy-Back
There is no current on market buy-back.
Voting Rights
The voting rights attached to ordinary shares are that on a show of hands, every member present, in
person or proxy, has one vote and upon a poll, each share shall have one vote.
Option holders do not have any voting rights on the options held by them.
Warrant holders do not have any voting rights on the warrants held by them.
Statement Regarding Use of Cash and Assets
During the period between 28 December 2018 and 30 June 2019, Jaxsta has used its cash and assets
readily convertible to cash that it had at the time of ASX admission in a way consistent with its
business objectives set out in the Prospectus dated 7 September 2018.
Corporate Directory
Directors
Brett Cottle
Chairman
Jacqueline Louez Schoorl
Executive Director
Linda Jenkinson
Non-Executive Director
Jorge Nigaglioni
Non-Executive Director
Company Secretary
Shelley Burger
Company Secretary
Key Executives
Jacqueline Louez Schoorl
Chief Executive Officer
Renee Bryant
Chief Financial Operations Officer
Philip Morgan
Chief Information Officer
Registered Office
Level 1/ 113-115 Oxford Street
Darlinghurst NSW 2010
Contact Details
Web:
Tel:
Email:
https://www.jaxsta.com/
(02) 8317 1000
jaxstainvestors@jaxsta.com
Auditors
Walker Wayland Audit (WA) Pty Limited
Level 3, 1 Preston Street,
Como WA 6152
Principle Place of Business
Level 1/ 113-115 Oxford Street
Darlinghurst NSW 2010
Share Registry
Security Transfer Australia
770 Canning Highway
Applecross WA 6153
73
Jaxsta Limited ordinary shares are listed on the Australian
Stock Exchange (ASX) under the ticker JXT.
74
The story behind the music
Photo credit: Anton Mislawsky
Jaxsta Ltd
ABN 15 106 513 580
Level 1 / 113-115 Oxford Street
Darlinghurst NSW 2010 Australia
info@jaxsta.com
www.jaxsta.com