1
Financial Year
ended 30 June 2024
ANNUAL
REPORT
2
1
On behalf of the Board of Directors of Medical Developments
International, I am pleased to present the Annual Report for the
year ended 30 June 2024. The Report highlights the positive
momentum we have achieved in our financial performance as well
as progression of our strategy.
Despite falling short of our expectations, the Company delivered
strong financial improvements in FY24.
The Company undertook a successful $10 million capital raise to
support the acceleration of specific mid-term growth objectives
and to secure the Balance Sheet. The Company is making good
progress toward cashflow positivity.
We expect to see further growth in FY25 as the changes that Brent
and his team have implemented take effect.
On behalf of the Board, I would like to recognise the efforts of all
employees as the company moves toward financial sustainability.
I especially thank Brent for his leadership in navigating difficult
circumstances.
I would also like to thank our shareholders for their continued
investment in the Group. We are very encouraged by our progress
in FY24 and look forward to continued momentum in the
year ahead.
Gordon Naylor Company Chair
Message from the Company Chair
Contents
Overview
Message from the Company Chair
1
Message from the CEO
2
Company Overview
4
FY24 Highlights
7
Review of Operations and Financial
Performance
8
Financial Reports
20
Directors’ Report
22
Remuneration Report
27
Auditors Independence Declaration
43
Independent Auditor’s Report
44
Financial Statements
50
Directors’ Declaration
86
Shareholder information
87
2
3
Message from the CEO
Brent MacGregor Chief Executive Officer
The Group delivered strongly improved financial results in FY24, reflecting efforts across the organisation to
grow volume, improve margins, reduce costs, and deliver operational improvements.
While we delivered good progress, we did fall short of achieving our revenue aspirations in the year. A longer
than expected sales cycle for Penthrox in the Australian hospital segment, and seasonal demand softness in the
Australian respiratory market, resulted in lower volumes than planned.
Notwithstanding these challenges, we remain confident in the long-term growth opportunities of our lead
products and are encouraged by the positive momentum we have achieved.
FY24 performance
Group revenue grew to $33.2 million, up 3% on the prior year.
Pain Management segment revenue grew 4% to $21.3 million. Revenue in Australia was up 28%, with strongly
improved pricing and volume growth, driven by increased Penthrox penetration in hospital emergency departments.
Revenue in Europe was up 11% with strong demand from the Nordic region and continued growth momentum in the
UK. Demand in France also improved despite the removal of promotional activity in FY24. Revenue from other markets
was down 41%, driven primarily by inventory stocking for the relaunch of Penthrox in Canada in the prior year.
Revenue in the Respiratory segment was up 1% at $11.9 million. US revenues were up 37%, reflecting continued
strong market share gains in our target growth market. In Australia, our leading market share was maintained
despite revenue being down 18% due to the lower prevalence of respiratory conditions in the period. Revenue in
Europe was down 44% due to the impact of inventory stocking in the prior year.
Improved pricing and operational efficiency delivered $7.2 million in earnings benefits. Gross margins were
strongly improved, up 5ppts to 74%.
Higher revenues, improved margins and lower costs delivered a $6.6 million improvement to Underlying EBIT.
Free cashflow improved by $10.2 million, with enhanced earnings, disciplined working capital management, and
lower capital expenditure.
In August 2024 we successfully completed a $10 million capital raise. Our Balance Sheet is strong with funding
capacity to accelerate delivery of our strategy.
Strategy
The Group’s near-term strategic focus is to increase the penetration of Penthrox in existing markets, and to
continue to grow its Respiratory segment through market share gains, particularly in the US. Longer term, the
Group seeks to enter new and attractive markets for Penthrox, including the US.
The Group made good progress in its strategy in FY24, advancing the following key priorities:
1. Improve margins through pricing and efficiency
Higher Penthrox pricing and efficiency benefits delivered a gross margin improvement of five percentage points
and a reduction in costs of $5 million in the year.
Operational efficiency initiatives that were implemented in FY24 will drive a further $3-4 million reduction in costs in FY25.
2. Increase penetration of Penthrox in Australian hospital emergency departments
In Australia, Penthrox was listed on protocols in 44 new hospitals, and the total number of purchasing hospitals
increased by 68 over the last year, to 244 hospitals. In the period, Penthrox was also listed on the South
Australian state formulary for use in emergency departments.
Volume in the hospital segment grew by ~30%, however the strong lead indicators are yet to be fully reflected in
volume growth due to a longer than expected sales cycle. Our learnings to date will inform our commercial and medical
engagement activities in the year ahead as we look to accelerate penetration of this large and attractive segment.
3. Grow Penthrox in Europe
The Group reported record European annual in-market volumes in FY24, with the Nordic region, France and the
UK all performing well.
Early in the year we transitioned to a “capital-light” operating model in Europe, driven by scaling back our in-
market promotional activity in France which significantly reduced our cost to serve. We have since advanced
negotiations with partners for Penthrox distribution in France and in Switzerland.
Preparations for submission of the MAGPIE paediatric study data to the European regulatory agency in August
2024 (for select markets) were completed. Future regulatory approval of our submission to reduce the age
indication for Penthrox to children >6 years of age would expand the addressable market and could also address a
barrier to Penthrox entry into some ambulance trusts in the UK.
The UK is our largest existing market for Penthrox outside of Australia. We have extended the agreement for
distribution of Penthrox in the UK and Ireland to the end of 2027. The extension delivers improved economic
terms for the Group from FY25 and provides a strong foundation to maximise the potential of a broader age
indication in these markets from FY26.
4. Continue to grow in the Respiratory segment
Our key target growth market in the Respiratory segment remains the US. Here we delivered robust growth for
the third consecutive year with revenue in FY24 up 37%.
5. Advance US market entry for Penthrox
In October 2023, we had a positive meeting with the US FDA. The meeting provided increased clarity on the
clinical pathway to US market entry. From this, we have been able to develop more fully our estimates of project
costs and timelines.
We announced in April 2024, however, that following further evaluation of resourcing requirements and funding
options to progress market entry plans, we would pause the commencement of the next phase of investment in
favour of focusing on the underlying business.
Aligned with the delayed commencement of further US market entry activity, investment in the Group’s next
generation device was also paused.
Plans will be recommenced at the appropriate time. We remain confident that an attractive commercial
opportunity exists for Penthrox in the US.
Sustainability
During the year, we undertook an evaluation of how our business practices meet key environmental, social and
governance (ESG) standards and expectations. The evaluation will inform development of the Group’s ESG
strategy and governance, and preparations for future regulatory changes.
Outlook
The Group expects positive momentum in margins and earnings to continue
in FY25, with underlying EBIT to be strongly improved on FY24, driven by higher
average Penthrox prices and operational efficiencies of $3-4 million.
Positive operating cashflow is expected to be achieved by the end of FY25.
4
5
Pain Management
A world leader in the supply of analgesia
for acute trauma and procedural pain
The Company manufactures its unique inhaled analgesic,
Penthrox® (the “Green Whistle”), at manufacturing facilities
at Scoresby and Springvale in Victoria, Australia. Penthrox® is
a fast onset, non-opioid analgesic indicated for pain relief by
self-administration in patients with trauma and those requiring
analgesia for surgical procedures. Penthrox® has been used
safely and effectively for more than 40 years in Australia, and is
now approved for sale in over 40 countries with approximately
8 million administrations globally.
Respiratory
A leading supplier of respiratory
products to help patients manage asthma
and chronic obstructive pulmonary
disease (COPD)
The Company supplies pharmacies, medical clinics, and
hospitals with a range of respiratory devices including space
chambers, portable nebulisers and silicon face masks in
Australia, the USA, Europe, and Asia, either directly or through
partnership with leading distributors.
Strategy
The Company’s strategic focus is to accelerate penetration of Penthrox® in existing markets,
and to grow its Respiratory segment through market share gains.
Penthrox®
Respiratory
Penthrox® & Respiratory
Company Overview
A leader in acute pain relief and
respiratory products
Registered in over 40 countries
7
Financial Overview
Key Achievements
•
Underlying EBIT improved $6.6 million (+36%)
•
Free cashflow improved $10.2 million (+42%)
•
Gross margin improved by 5ppts, operating costs down ~$5.0 million
•
Penthrox growth of ~30% in Australian Hospital emergency departments
•
Record in-market volumes of Penthrox® in Europe
•
Successful clinical study outcome in children (MAGPIE Study) provides potential to expand
addressable market for Penthrox
•
Extension of agreement for Penthrox distribution in UK and Ireland to end of 2027 on more
favourable economic terms
•
Continued share growth in the attractive US respiratory spacer market
•
$10 million capital raise completed in August 2024 provides funding to accelerate growth
•
Positive operating cashflow expected by the end of FY25
FY24 Highlights
6
$33.2m
$21.3m
$11.9m
Underlying
Adjustments
$21.5m (loss)
Underlying
EBIT
$11.6m (loss)
(pcp $18.2m loss)
(pcp $10.3m gain)
(pcp $5.6m loss)
NPAT
$41.0m (loss)
Pain Management
Revenue
Respiratory
Revenue
Revenue
+1%
+4%
+3%
9
8
Review of Operations and
Financial Performance
OVERVIEW
•
Revenue(1) up 3% to $33.2 million (pcp $32.3 million).
-
Pain Management revenue up 4% driven by volume growth in Australia and Europe and improved pricing.
-
Respiratory revenue up 1%, with strong volume growth in the US offset by lower volume in other regions.
•
Net loss after tax of $41.0 million (pcp $5.6 million loss).
•
Underlying EBIT(2) improved by $6.6 million at $11.6 million loss (pcp $18.2 million loss).
•
Strongly improved margins, driven by pricing and business efficiencies.
•
Free cash flow(3) improved by $10.2 million.
•
Continued penetration of Penthrox in global markets:
-
Record in-market volumes in Europe, up 6% on pcp, with pleasing momentum in the Nordics, continued
growth in the UK, and growth in France despite the scale-back of in-market promotional activity.
-
Volume growth of 3% in Australia, with volume growth of ~30% in the hospital segment and solid
demand from ambulance.
•
Market share growth in the US Respiratory market with US sales up 37%.
•
Transition to a “capital-light” operating model in Europe completed, with cost to serve significantly reduced.
•
Successful paediatric clinical study outcome (MAGPIE), provides the potential to expand the addressable
market for Penthrox to children in select markets outside of Australia.
•
Extension of agreement for distribution of Penthrox in the UK / Ireland with improved economic terms.
•
$10 million capital raise completed in August 2024 provides funding to accelerate growth.
•
Positive operating cashflow expected by the end of FY25.
10
11
GROUP RESULTS
Revenue
Revenue for the period of $33.2 million was 3% higher than the pcp.
Revenue in the Pain Management segment was up 4% driven by improved pricing, particularly in Australia.
European Pain Management revenue was up 11%, with growth in underlying demand of 6%. Revenue for
Penthrox in Australia was up 28%,reflecting volume growth of 3% and higher prices. Revenue from Rest of World
countries was down 41% mostly due to lower volumes to Canada following inventory stocking for the relaunch of
Penthrox in the prior year. Milestone income was $0.2 million (pcp $0.7 million).
Revenue in the Respiratory segment was up 1% with strong volume growth in the US, supported by market share
gains, offset by lower demand in Australia, due to lower prevalence of respiratory conditions, and lower demand
from Europe, following inventory stocking in the prior period.
$’000
2024
2023
Change $
Pain Management
21,296
20,448
848
Respiratory
11,853
11,720
133
Other
-
169
(169)
Revenue1
33,149
32,337
812
Contract termination revenue
-
18,928
(18,928)
Total
33,149
51,265
(18,116)
Note: Underlying EBITDA and Underlying EBIT as defined on page 16-17, are non-IFRS financial measures
used by management to assess the performance of the business. Refer to Note 1.1 of the full year consolidated
financial report for a reconciliation of Group Underlying EBITDA and Group Underlying EBIT by segment.
Underlying EBIT was $11.6 million loss, improved $6.6 million on the pcp ($18.2 million loss).
Underlying EBIT benefitted from higher pricing in the Pain Management segment, higher Penthrox volumes
in Australia and Europe, share growth in the US Respiratory market, and lower costs, driven by efficiency
gains. This offset the impact to earnings of lower Penthrox volumes in Rest of World Markets, lower demand
for respiratory products in Australia and Europe, non-capital costs associated with the review of the European
operating model and US market entry, and inflationary impacts.
Depreciation and amortisation was up by $0.3 million from the pcp.
Underlying adjustments before tax were a net $21.5 million loss in the period, including:
• Share-based payment expense arising from the cancellation of options as part of the transition to new CEO
remuneration arrangements ($5.1 million). This is a non-cash adjustment; no benefit was received by the
CEO.
• Impairment expense of $16.4 million, including $15.8 million for the impairment of capitalised development
costs relating to the US market entry, and a $0.6 million impairment in relation to redundant plant and
equipment in the manufacturing operations.
Underlying adjustments of $10.3 million gain in the prior period related to:
• Contract termination revenue arising from the termination of agreements for the distribution of Penthrox in
China ($18.5 million) and other countries where revenue opportunities are not being pursued ($0.4 million).
• Impairment of capitalised registration costs following the cessation of market activities in China ($5.7
million), and in other countries where revenue opportunities are not being pursued ($0.9 million). There was
also a $0.1 million impairment of patents and trademarks.
• Costs to complete a comprehensive commercial market assessment for Penthrox in the US ($1.9 million).
$’000
2024
2023
Change $
Pain Management
(1,139)
(9,716)
8,577
Respiratory
974
1,498
(524)
Other4
(8,072)
(6,915)
(1,157)
Underlying EBITDA5
(8,237)
(15,133)
6,896
Depreciation and amortisation
(3,394)
(3,113)
(281)
Underlying EBIT2
(11,631)
(18,246)
6,615
Share-based payment expense arising from the cancellation
of options
(5,136)
-
(5,136)
Impairment losses - capitalised registration costs
(15,804)
(6,709)
(9,095)
Impairment losses - plant & equipment
(571)
-
(571)
Contract termination revenue
-
18,928
(18,928)
Commercial market assessment costs
-
(1,930)
1,930
Underlying adjustments
(21,511)
10,289
(31,800)
Reported EBIT
(33,142)
(7,957)
(25,185)
Net interest income
216
465
(249)
Income tax benefit / (expense)
(8,066)
1,883
(9,949)
Net loss after tax
(40,992)
(5,609)
(35,383)
Operating Performance
12
13
Tax expense in the current period was $8.1 million. Due to uncertainties with respect to the utilisation of
tax losses in the future, the Group has derecognised from tax assets tax losses carried forward from prior
periods of $13.7 million and has not recognised current year tax losses of $1.3 million as deferred tax assets.
Notwithstanding de-recognition for accounting purposes at this time, tax losses remain available to the Group to
be utilized against future taxable profits.
Net loss after tax for the period was $41.0 million (pcp loss after tax of $5.6 million).
Further detail on revenue and earnings in each of the Group’s operating segments is contained in the Review of
Operations below.
Net cash flows used in operating activities were $10.8 million, $5.7 million lower than the pcp. This reflects an
improved underlying EBITDA performance of $6.9 million in the period, partially offset by a $1.3 million increase
in working capital and other assets and liabilities utilised. This included one-off payments of $2.7 million for a
commercial market assessment of the US completed in FY23 and contract termination costs in France following
the scale down in investment at the end of FY23. Excluding these payments, cash utilised in working capital was
improved.
Commentary relating to the movement in working capital and other assets and liabilities in the period is provided
in the Balance Sheet section.
Key Items - $’000
2024
2023
Change $
Net cash flows used in operating activities
(10,780)
(16,495)
5,715
Payments for property, plant and equipment
(793)
(1,784)
991
Payments for other intangible assets
(2,376)
(5,881)
3,505
Proceeds from the issue of shares (net of costs)
-
28,316
(28,316)
Other cashflows
(807)
(253)
(554)
Net increase / (decrease)
in cash and cash equivalents
(14,756)
3,903
(18,659)
Cash Flow
Net cash flows used in operating activities
$’000
2024
2023
Change $
Underlying EBITDA5
(8,237)
(15,133)
6,896
Share based payment expense and other non-
cash items5
1,127
718
409
Change in trade and other receivables
1,861
(2,870)
4,731
Change in inventory
(393)
(1,842)
1,449
Change in trade and other payables
(5,261)
2,900
(8,161)
Change in trade and other working capital
(3,793)
(1,812)
(1,981)
Change in other assets and liabilities
(93)
(733)
640
Interest received
302
560
(258)
Interest paid
(86)
(95)
9
Net cash flows used in operating activities
(10,780)
(16,495)
5,715
Net cash flows used in investing activities
Payments for property, plant and equipment were $0.8 million for the period, a decrease of $1.0 million versus
the pcp, primarily relate to the Group’s manufacturing operations.
Payments for other intangible assets were $2.4 million for the period, mostly related to trials and market
registration activities, including the paediatric clinical study in the UK and market entry activity in the US ($2.1
million), and other intangible assets ($0.3 million).
Balance Sheet
Key Items - $’000
2024
2023
Change $
Cash
9,735
24,661
(14,926)
Trade and other receivables
7,071
8,932
(1,861)
Inventories
8,771
8,378
393
Prepayments
565
791
(226)
Property plant & equipment
10,162
12,122
(1,960)
Intangible assets
22,857
38,317
(15,460)
Deferred tax assets
-
8,112
(8,112)
Total Assets
59,161
101,313
(42,152)
Trade and other payables
8,254
14,186
(5,932)
Employee benefit provisions
948
1,070
(122)
Unearned income
1,920
2,182
(262)
Deferred tax liabilities
19
-
19
Lease liabilities
2,286
2,560
(274)
Total Liabilities
13,427
19,998
(6,571)
Net Assets
45,734
81,315
(35,581)
14
15
REVIEW OF OPERATIONS
Pain Management
The Pain Management segment is a world leader in the supply of analgesia for acute and procedural pain. The
Group manufactures its world leading inhaled analgesic, Penthrox® (the “Green Whistle”), at manufacturing
facilities at Scoresby and Springvale in Victoria, Australia. Penthrox is sold into domestic and international
markets through distribution partnerships and direct in-market capability.
$’000
2024
2023
Change $
Revenue1
21,296
20,448
848
Underlying EBITDA5
(1,139)
(9,716)
8,577
Underlying EBIT2
(3,852)
(12,299)
8,447
Revenue for Pain Management was up 4% on the pcp at $21.3 million.
Revenue in Europe was up 11%. In-market demand in Europe was up 6%, with strongly improved volume in the
Nordics and continued momentum in the UK and Ireland. Volume in France was improved despite the scale-back
of promotional activity in FY23.
Revenue in Australia was up 28%, reflecting volume growth of 3% and higher pricing. Demand from the
ambulance segment remained solid. Volumes into hospital emergency departments were up 30%, reflecting
progress in the commercial strategy to expand in this segment.
Revenue from Rest of World countries was down 41% mostly due to lower volumes to Canada following inventory
stocking for the relaunch of Penthrox in the prior year.
Underlying EBIT for the period was a $3.9 million loss, improved by $8.4 million on the prior year. Earnings
benefited from higher pricing, particularly in Australia, a reduction in the cost-to-serve in Europe following
transition to a capital-light operating model, and other business efficiencies.
Net change in cash for the period was a $14.9 million decrease.
Trade and other receivables decreased by $1.9 million, reflecting timing of customer deliveries and strong
collections particularly in relation to large deliveries late in FY23 that were due for collection in the current
period. Inventories increased $0.4 million, reflecting growth in the US respiratory business.
The decrease in property plant and equipment and intangible assets of $17.4 million includes an impairment of
capitalised development costs relating to US market entry, including US market registration costs ($13.9 million)
and development costs for the next generation device ($1.9 million), and an impairment of redundant plant and
equipment ($0.6 million). Additions were $2.4 million, and depreciation and amortisation was $3.4 million. Net
tax asset and liabilities decreased by $8.1 million, driven by the derecognition of prior period tax losses ($13.7
million) due to uncertainties with respect to the utilization of tax losses in the future. Current period tax losses of
$1.3 million were also not recognised.
The decrease in trade and other payables of $5.9 million reflects the payment of $1.9 million for a comprehensive
assessment of the commercial potential for Penthrox in the US, payment for capital expenditure $0.9 million, and
$0.8 million for contract termination costs in France following the scale down of investment in the prior period. An
additional $2.3 million decrease in trade payables primarily relates to timing differences on inventory purchases
and freight.
A decrease of $0.3 million in unearned income relates to the amortisation of government grants and milestone
income in the period. Unearned income of $1.9 million remaining at the end of the period relates to unamortised
income received for the distribution of Penthrox in Vietnam and Thailand, and Government Grants.
Respiratory
The Respiratory segment is a leading supplier of respiratory products including space chambers, peak flow
meters, portable nebulisers and silicone face masks to aid sufferers of asthma and COPD (chronic obstructive
pulmonary disease). The Respiratory segment supplies into Australia, the USA, Europe and Asia through
partnership with leading distributors.
$’000
2024
2023
Change $
Revenue
11,853
11,720
133
Underlying EBITDA5
974
1,498
(524)
Underlying EBIT2
762
1,250
(488)
Revenue for the Respiratory segment was up 1% at $11.9 million.
Revenue in the US was stronger, up 37% on the pcp, reflecting continued growth through market share gain.
Revenue in other regions was down, reflecting lower volumes, due in part to the lower prevalence of respiratory
conditions during the period, and inventory stocking in Europe in the pcp.
Underlying EBIT at $0.8m was $0.5m lower, due to lower volume in Australia and Europe.
16
17
BUSINESS STRATEGY
The Group’s nearer term strategic focus is to increase
the penetration of Penthrox in existing markets, and
to continue to grow its Respiratory segment through
market share gains, particularly in the USA. Longer
term, the Çompany seeks to enter new and attractive
markets for Penthrox, including the US.
Execution of strategy in FY24
The Company achieved good progress in delivering its
strategic priorities in FY24. Key outcomes include:
•
Strongly improved margins, delivered through
pricing and operational efficiencies. Earnings
benefits of $7.2 million were delivered in the
period, with additional savings of $3-4 million to
be realised in FY25 from initiatives implemented in
FY24.
•
Increased penetration of Penthrox in Australian
hospital emergency departments. Volume growth
of ~30% was delivered in the hospital segment
in the period, with encouraging lead indicators.
There have been 44 new protocol listings for
Penthrox over the last 18 months, and the total
number of purchasing hospitals in FY24 increased
by 68 to 244.
•
Record in-market Penthrox volumes in Europe,
delivering 6% growth versus FY23.
•
Transition to a “capital-light” operating model in
Europe, with a significant reduction in the cost to
serve. Partner negotiations were advanced for
Penthrox distribution in France and in Switzerland.
•
Extension of the Penthrox distribution agreement
for the UK and Ireland, with improved economic
terms.
•
Successful paediatric clinical study outcome
(MAGPIE), which provides the potential to expand
the addressable market for Penthrox to children in
select markets outside of Australia.
•
Continued market share gains in the attractive US
respiratory spacer market.
•
Positive momentum in earnings and cashflow.
•
Capital raise of $10 million to accelerate growth
and improve balance sheet strength completed in
August 2024.
Following further evaluation of resourcing
requirements and funding options to progress US
market entry plans, the Group determined to pause
the next phase of investment in favour of focusing on
the underlying business. Aligned with the delayed
commencement of further US market entry activity,
investment in the Group’s next generation device was
also paused.
FY25 priorities
The Company will continue to drive momentum toward
achieving positive operating cashflow by the end of
FY25. Key priorities include:
•
Improve margins through pricing and operational
efficiency.
•
Accelerate penetration of Penthrox in Australian
hospital emergency departments.
•
Grow Penthrox in global markets.
•
Drive continued growth in Respiratory.
OUTLOOK
FY25 underlying EBIT
The Group expects positive momentum in margins and
earnings to continue in FY25, with underlying EBIT
to be strongly improved on FY24, driven by higher
average Penthrox prices and operational efficiencies of
$3-4 million. Positive operating cashflow is expected to
be achieved by the end of FY25.
FY25 capital expenditure
Capital expenditure in FY25 is expected to reduce to
around $1.5-2.0 million.
OTHER EVENTS OF
SIGNIFICANCE
Other than mentioned above, there has not been
any matter or circumstance that has arisen that has
significantly affected, or may significantly affect
the operations of the Group, the results of those
operations, or the state of affairs of the Group in future
years.
NOTES
(1) In the prior year Revenue excludes Contract
termination revenue arising from the termination of
agreements for the distribution of Penthrox in China
($18.5 million), and other countries where revenue
opportunities are not being pursued ($0.4 million).
(2) Underlying EBIT is a non-IFRS financial measure
which is calculated as earnings before finance
costs, net of interest income, tax and underlying
adjustments.
(3) Free cash flow is a non-IFRS financial measure
which is calculated as net cash flow used in
operating activities plus net cash flows used in
investing activities.
(4) Other comprises unallocated costs associated with
corporate overheads, and in the prior period minor
costs in relation to the Veterinary business which
was discontinued during the 2022 financial year.
(5) Underlying EBITDA is a non-IFRS financial measure
which is calculated as Earnings before finance
costs, net of interest income, tax, depreciation and
amortisation and underlying adjustments.
(6) Share based payment expense and other non-
cash items in the Net cash flows used in operating
activities table on page 3 excludes the $5.1 million
accelerated share-based payment expense
included in underlying adjustments.
BUSINESS RISKS
Risk recognition and management are considered by
the Company as integral to its objectives of creating
and maintaining shareholder value, and execution of
the Company’s strategy. Effective risk management
is key to operational activities and decision-making,
strategic planning, resource allocation, compliance,
accountability and good governance.
The Company operates in a constantly evolving
environment of science, regulation and healthcare.
We are exposed to risks inherent in the global
pharmaceutical and medical devices industry, which
includes research and development, supply chain and
intellectual property.
The Company actively manages a range of risks with
the potential to have a material impact on the Group
and its ability to achieve its objectives. Identified risks,
which are common to companies in the pharmaceutical
and medical device industries, have been prioritised by
the Company in order of risk and opportunity impact.
These risks, which include global trends, have also
formed the basis of response planning developed
during the period.
While every effort is made to identify and manage
material risks, additional risks not currently known or
detailed below may also affect future performance.
The Company’s principal risks, and an explanation of
our approach to managing them, are outlined below.
Product quality
The Company’s products must meet a wide range of
regulatory requirements aimed at ensuring the quality
and efficacy of its products and the safety of patients.
The Company’s financial performance and reputation
could be adversely impacted if quality requirements
are not met.
In managing this risk, the Company’s manufacturing,
product quality assurance and pharmacovigilance
practices serve to deliver the highest standards of
safety and the preservation of our reputation. We
adopt and comply with a broad suite of internationally
recognised standards through our quality management
system, including good manufacturing practice
(GMP), good distribution practice (GDP) and audits
of third-party vendors and suppliers. Our processes
and procedures also meet good pharmacovigilance
practice (GPV) and we seek to ensure that product
information is up-to-date and contains all relevant
information to assist customers and healthcare
practitioners to use our products. Auditing of
compliance with these standards is frequently
undertaken by independent regulatory authorities.
Successful commercialisation
The Company’s financial performance is dependent on
its ability to develop and successfully commercialise
our products. The Company will need to evolve and
optimally develop its operating model to support
growth. Successful commercialisation includes
obtaining regulatory approvals, successful product
launches into new markets, the ability to identify
and onboard promotional partners, ability to use
its products in a broader range of approved uses
and maintaining adequate pricing for products. The
Company faces risks in respect of its key product,
Penthrox, including the ability of the Company to drive
market growth and market penetration in key markets.
The Company implements short-, medium- and
long-term strategies and near term objectives that
are reviewed at least annually. Where appropriate the
Company has adopted a different operating model
considering commercialisation challenges.
Financial risk
In addition to the financial impact arising from
commercialisation risk, there are a variety of risks
arising from the unpredictability of financial markets,
including the cost and availability of funds to meet
business needs and movements in market risks such as
foreign exchange rates.
The Company implements financial risk management
practices by managing exposure to financial risks
including internal controls and cash flow management.
Research & development
R&D risk involves understanding the uncertainties
and potential challenges associated with innovative
projects. There is an inherent risk in research and
development activities that the outcome is not
favourable, including that clinical endpoints are not
met, required criteria is not met, clinical trials are
unable to be recruited for, or that design iteration takes
longer than anticipated. The Company’s products may
be at a clinical stage of development in unapproved
markets and further development is necessary. If
the Company’s proposed products, data or design
iterations are considered not to be safe or efficacious
or ineffective for therapeutic purposes or the cost
of commercial scale manufacture becomes too
expensive, the value of the Company’s technology and
18
19
resulting value of its Shares may be materially harmed.
To manage this risk, the Company has a dedicated
Research & Development function and the Company
closely monitors progress of development activities.
The Company also dedicates resources to intellectual
property protection.
Supply chain
Having a sustainable and reliable supply chain is
critical to the success of the Company’s objectives,
particularly to achieving a consistent, economical,
and efficient supply of its products. The Company is
reliant on third parties for the manufacture and supply
of a substantial portion of its products. Disruptions
to that supply chain, caused by an interruption to
the availability of a key material or component, may
result in unexpected disruption or interruption to our
products. Increases in the costs of raw materials or
other commodities may adversely affect the Company’s
profit margins if higher costs cannot be passed on in
the form of price increases or unless the Company can
achieve further cost efficiencies in its manufacturing
and distribution processes.
The Company constantly monitors inventory and
demand, maintains critical stock levels and seeks,
where possible, to identify alternate sources of supply.
Supply of materials were impacted by COVID, requiring
the Company to implement risk mitigations, including
increased ordering lead times and increased inventory
holdings. Proactive supplier management and
supplier audits are also important components of the
Company’s risk mitigation.
Regulatory and legislative risk
The Group operates under a broad range of legal,
regulatory and tax systems. The Company’s financial
strength may be impacted by specific regulatory
regimes, changes in regulatory regimes, difficulty
interpreting or complying with laws. Changes in laws
and regulations, including their interpretation or
enforcement, could affect, the Company’s business
or products. For example, changes in reimbursement
or accounting standards, tax laws and regulations,
environmental or climate change laws, restrictions or
requirements related to product content, labelling and
packaging.
The Company and the development /
commercialisation of its proposed products /
technologies are subject to extensive laws and
regulations, including but not limited to the regulation
of human medical device products. A risk exists that
the Company’s products or data may not satisfy
regulatory requirements in markets in which we
are seeking approval and ultimately may not gain
approval or authorisation, that the approval process
may take longer than expected or at greater cost, or
approvals are granted with restrictions. As a result,
the Company may fail to commercialise or out-license
its products. In addition to these, if the Company fails
to remain compliant with various evolving regulatory
requirements, there is a risk that the Company’s
financial performance could be adversely affected.
In managing this risk, the Group has a product
regulatory compliance framework and a dedicated
Regulatory team with inhouse expertise. The Company
has developed and seeks to continuously improve
its broader regulatory compliance framework. The
Company is also actively risk managing the impact of
clinical change regulation and potential impact on the
supply chain of raw materials.
Cyber risk
Increasing sophistication of external attackers
demands an effective and up-to-date cyber
security control environment to prevent significant
organisational loss of systems, intellectual property
and clinical data, damage to reputation and/or
disruption to business. To manage this risk, the
Company has focused on cyber security training,
enhanced back up procedures, improved firewall and
screening mechanisms.
20
Financial Reports
21
Directors’ Report
22
Auditor’s Independence Declaration
43
Independent Auditor’s Report
44
Consolidated Statement of Profit or Loss and Other
Comprehensive Income
50
Consolidated Statement of Financial Position
51
Consolidated Statement of Changes in Equity
52
Consolidated Statement of Cash Flows
53
Notes to the Financial Statements
54
Section 1: Performance
1.1
Group results
54
1.2
Revenue from contracts with customers
56
1.3
Taxation
57
1.4
Dividends
59
Section 2: Operating Assets and Liabilities
2.1
Working capital
60
2.2
Unearned income
62
2.3
Non-current assets
62
2.4
Commitments and contingencies
70
2.5
Leases
70
Section 3: Capital Structure
3.1
Net cash
71
3.2
Contributed equity and reserves
72
3.3
Capital management
73
3.4
Going concern
73
3.5
Managing our financial risks
73
Section 4: Remunerating Our People
4.1
Employee benefits
78
4.2
Share based payments
78
4.3
Key management personnel
80
Section 5: Other Disclosures
5.1
Basis of preparation
80
5.2
Related parties disclosure
81
5.3
Parent entity financial information
82
5.4
Controlled entities
83
5.5
Auditor’s remuneration
83
5.6
Segment assets and segment liabilities
84
5.7
Subsequent events
84
Consolidated Entity Disclosure Statement
85
Director’s Declaration
86
Contents
Introduction
This is the Consolidated Financial Report of Medical
Developments International Ltd (“MVP” or the
“Company”) and its subsidiaries (together referred
to as the “Group”) for the year ended 30 June 2024.
This Consolidated Financial Report was issued in
accordance with a resolution of the Directors on 26
August 2024.
Information is only included in Consolidated Financial
Report to the extent the Directors consider it material
and relevant to the understanding of the financial
statements. A disclosure is considered material and
relevant if, for example:
•
the dollar amount is significant in size and / or by
nature;
•
the Group’s results cannot be understood without
the specific disclosure;
•
it is critical to allow a user to understand the impact
of significant changes in the Group’s business
during the year; and
•
it relates to an aspect of the Group’s operations
that is important to its future performance.
Preparing this consolidated financial report requires
management to make a number of judgements,
estimates and assumptions to apply the Group’s
accounting policies. Actual results may differ from
these judgements and estimates under different
assumptions and conditions and may materially affect
the financial results or the financial position reported
in future periods. Key judgements and estimates,
which are material to this report, are highlighted in the
following notes:
•
Note 1.3 Deferred tax assets
•
Note 2.3 Property, plant and equipment
•
Note 2.3 Goodwill and other intangibles
•
Note 3.4 Going concern
To assist in identifying key accounting estimates and
judgements, they have been highlighted as follows:
22
23
DIRECTORS’ REPORT
The Directors of Medical Developments International Limited (“MVP” or the “Company”) herewith submit the
annual financial report of the Company and the entities it controlled (“Group”) for the financial year ended 30
June 2024.
BOARD OF DIRECTORS
The following persons were Directors of the Company from their date of appointment up to the date of this
report:
Non-Executive
Mr G Naylor
BE (Hons), DipCompSc, MBA, CPA, GAICD, FTSE, MIE(Aust)
Non-Executive Chair (since 18 December 2020)
Mr Naylor has enjoyed a long and successful international business career. For over 30 years he was a key part
of the internationalisation of CSL, holding a range of business and functional leadership roles including Chief
Financial Officer. At the time of his retirement from CSL, he was the President of Seqirus where he led the 3-year
turnaround of that business into one of the most successful vaccine companies in the world. Mr Naylor joined the
MVP Board on 14 October 2020.
Public company directorships in the past 3 years
Orica Limited (since 1 April 2022)
Mr L Hoare
AssocDipAppSc(Orth), GradDipBus, GAICD
Non-Executive Director (since 27 September 2013)
Mr Hoare is an accomplished commercial leader with expertise across multiple Life Science sectors. He is
currently the Managing Director of Lohmann & Rauscher, Australia & New Zealand (ANZ), a private EU based
medical device company. Previously, he was Managing Director of Smith & Nephew (S&N) ANZ, one of S&N’s
largest global subsidiaries outside the USA. He served as President of S&N’s Asia Pacific Advanced Wound
Management (AWM) business for 5 years and was a member of the Global Executive Management for the
AWM Division (as one of three Regional Presidents). In his 24 years with S&N, he also held roles in marketing,
divisional and general management. His career has also included a senior role at Bristol-Myers Squibb, and as
Vice-Chair of the board of Australia’s peak medical device industry body, Medical Technology Association of
Australia. Mr Hoare is also the Chair of the Human Resources Committee.
Public company directorships in the past 3 years
Polynovo Limited since 27 January 2016
Ms C Emmanuel-Donnelly
B.Sci (Hons), M. ENT, Cert.Int.Prop.Law, MAICD
Non-Executive Director (since 26 May 2020)
Ms Emmanuel-Donnelly is an experienced IP and business development professional having 35 years’ experience
locally and internationally. Ms Emmanuel-Donnelly is a former Executive Manager of Business Development and
Commercial at the CSIRO, where she led the management of CSIRO’s IP team and IP portfolio for 14 years and
managed the CSIRO equity portfolio for over 5 years. Prior to this role, Ms Emmanuel-Donnelly was in-house IP
Counsel for Unilever in the UK and practised as a patent and trademark attorney for Wilson Gunn (UK), Davies
Collison Cave and Griffith Hack in Melbourne. Christine is also currently chairwoman of Impedimed Ltd and non-
executive director of Polynovo Ltd, Pikcha Holdings Ltd, trading as Seminal. She was previously on the Board of
the Institute of Patent & Trademarks Attorneys of Australia for 13 years.
Public company directorships in the past 3 years
Polynovo Limited since 13 May 2020
Impedimed Limited (since 28 September 2023)
Ms M Sontrop
B.AppSci, Grad Dip Quality Mgt, Grad Dip Management (Health), MBA, FAICD
Non-Executive Director (since 5 March 2021)
Ms Sontrop has extensive international experience in the biopharmaceutical sector across manufacturing
operations, quality, and business integration. During her 28 years with CSL Limited, Ms Sontrop was an integral
part of CSL’s globalisation through a series of major acquisitions. This included primary responsibility for the
turnaround of unprofitable manufacturing operations. Subsequently as head of global plasma manufacturing,
Ms Sontrop delivered a globally integrated manufacturing network spanning four countries. As head of CSL’s
Australia and New Zealand pharmaceutical business, Ms Sontrop and her team delivered Australia’s most
successful adolescent/adult immunisation program and achieved USFDA (US Food & Drug Administration)
approval to manufacture and export CSL’s seasonal and pandemic influenza vaccines. Ms Sontrop also has
significant international governance experience.
Public company directorships in the past 3 years
IDT Australia Limited from 1 March 2017 to 16 November 2021
Mr R Betts
B.Ec, ACA
Non-Executive Director (since 11 May 2021)
Mr Betts is an experienced executive who has held senior roles with ASX listed entities over 25 years. Mr Betts is
currently Chief Financial Officer at Ridley Corporation Limited and was previously Chief Financial Officer at Pact
Group Holdings Ltd for 6 years. Prior to that he held executive finance and general management roles at Orica
Limited. These roles provided Mr Betts with a deep understanding of working in various jurisdictions, including
North America, Europe and Asia. Mr Betts has extensive financial and governance experience within international
manufacturing environments. Mr Betts is Chair of the Audit and Risk Committee.
Dr R Basser
Non-Executive Director (since 1 September 2023)
Dr Basser is a qualified physician, with over 30 years of international medical and biopharmaceutical experience.
Dr Basser worked as a medical oncologist in Melbourne prior to joining CSL in 2001. During his 21 years at CSL,
he held multiple global executive roles, including Head of Global Clinical Development, Chief Medical Officer and
Senior VP of Research and Development for CSL Seqirus. Dr Basser has substantial expertise in international
drug and vaccine development and spent several years based in the USA. Dr Basser currently serves as a Non-
Executive Director on the Boards of Starpharma Holdings Limited and Doherty Clinical Trials. He has previously
served on the Board of the ANZ Breast Cancer Trials Group and the Hadassah Australia Medical Research
Collaboration.
Public company directorships in the past 3 years
Starpharma Holdings Limited (since 20 February 2023)
Company Secretary
Ms T Eaton
Company Secretary (since 8 August 2022)
Ms Eaton is an experienced General Counsel. Her previous roles include General Counsel at the Australian Red
Cross, and prior to that more than ten years in the pharmaceutical industry. This included three years as Legal
and Compliance Director at Gilead Sciences ANZ, and more than seven years as Legal Director at Merck & Co. Ms
Eaton brings an impressive record of working with public and private stakeholders alike, pricing and business
development transactions, and developing and managing compliance and risk frameworks. Ms Eaton also spent 5
years as a lawyer with Minter Ellison and Clayton Utz.
24
25
PRINCIPAL ACTIVITIES
MVP delivers emergency medical solutions dedicated
to improving patient outcomes in both domestic and
international markets. The Company manufactures
and distributes Penthrox®, a fast acting trauma and
emergency pain relief product, used in hospital
emergency departments, ambulance services, sports
medicine and for analgesia during short surgical
procedures. MVP also distributes a range of respiratory
devices for sufferers of asthma and COPD (chronic
obstructive pulmonary disease).
REVIEW OF OPERATIONS
AND FINANCIAL
PERFORMANCE
A review of the operations and financial performance
of the Group during the year and of the results of those
operations is contained on pages 8 to 18.
CHANGES IN STATE OF
AFFAIRS
Other than as discussed in the “Review of Operations
and Financial Performance” on pages 8 to 18, there
was no significant change in the state of affairs of the
Group during the year.
SIGNIFICANT EVENTS
AFTER BALANCE DATE
On 26 July 2024 the Group announced a fully
underwritten capital raise of $10 million comprising
an institutional placement and non-renounceable
entitlement offer to accelerate growth and improve
balance sheet strength. The institutional component
of the placement was completed on 30 July 2024
with gross proceeds of $6.9m being received. The
entitlement offer closed on 22 August 2024, with gross
proceeds of $3.1 million received on 27 August 2024.
Other than included above, there has not been any
matter or circumstance that has arisen that has
significantly affected, or may significantly affect
the operations of the Group, the results of those
operations, or the state of affairs of the Group
in future years.
FUTURE DEVELOPMENTS
Information regarding likely developments in the
operations of the Group in future financial years is
set out in the “Review of Operations and Financial
Performance” on pages 8 to 18.
ENVIRONMENTAL
REGULATIONS
The Group’s operations are not subject to any
particular and significant environmental regulation.
The Group has not incurred any liabilities under any
environmental legislation during the financial year.
ENVIRONMENTAL, SOCIAL
AND GOVERNANCE (ESG)
During the year the Group undertook an ESG readiness
assessment which will inform development of the
Group’s ESG roadmap and preparations for mandatory
reporting. Mandatory financial disclosures are
expected to be required from FY28 onwards. The
Group will develop and prioritise high-level initiatives
pertaining to the development of the Group’s ESG
strategy and governance.
DIVIDENDS
No dividends were declared in respect of the current
period. No dividends were declared in respect of the
previous corresponding period.
INDEMNIFICATION OF
OFFICERS AND AUDITORS
The Company’s Constitution requires the Company to
indemnify any person who is, or has been, an officer
of the Company (including the Directors) to the
extent permitted by law. This is reflected in the letter
of appointment entered by the Company with each
Director.
Consequently, the Company has entered into a Deed of
Indemnity and Access with each Director. No Director
has received benefits under an indemnity from the
Company during or since the end of the year.
PROCEEDINGS ON BEHALF
OF THE COMPANY
No person has applied to the court under section 237
of the Act for leave to bring proceedings on behalf of
the Company, or to intervene in any proceedings to
which the Company is a party, for the purpose of taking
responsibility on behalf of the Company for all or part
of those proceedings.
No proceedings have been brought or intervened in on
behalf of the Company with the leave of the court under
section 237 of the Act.
DIRECTORS’ MEETINGS
The following table sets out the number of directors’ meetings (including meetings of committees of directors)
held during the financial year and the number of meetings attended by each director (while they were a director
or committee member).
DIRECTORS’ SHAREHOLDINGS
The following table sets out each director’s relevant interest in shares at the date of this report.
nm - not a member of the relevant committee
(1) Dr R Basser was appointed as a Non-Executive Director effective from 1 September 2023
Directors hold 140,257 options over shares as at 30 June 2024 (2023: 140,257 options)
Scheduled Board
Meetings
Extraordinary Board
Meetings
Audit & Risk
Commitee
Human Resources
Commitee
Continuous
Disclosure
Committee
Held
Attended
Held
Attended
Held
Attended
Held
Attended
Held
Attended
Mr G Naylor
9
9
8
8
nm
nm
6
6
2
2
Mr L Hoare
9
9
8
8
nm
nm
6
6
nm
nm
Ms C Emmanuel-
Donnelly
9
9
8
8
5
5
nm
nm
nm
nm
Ms M Sontrop
9
9
8
8
5
4
6
6
nm
nm
Mr R Betts
9
9
8
8
5
5
nm
nm
2
2
Dr R Basser(1)
8
8
6
5
nm
nm
1
-
nm
nm
Relevant interest in
Ordinary shares
Options over shares
Mr G Naylor
950,573
105,502
Mr L Hoare
62,005
9,504
Ms C Emmanuel-Donnelly
56,475
16,435
Ms M Sontrop
20,591
784
Mr R Betts
23,383
8,032
Dr R Basser
15,873
-
1,128,900
140,257
26
27
AUDITED REMUNERATION REPORT
This Remuneration Report forms part of the Directors’ Report.
MESSAGE FROM THE HUMAN RESOURCES COMMITTEE (HRC)
On behalf of the Board of Directors, I am pleased to present MVP’s Remuneration Report for the year ended 30
June 2024 (FY24).
The year in review and FY24 executive remuneration outcomes
During FY24, under the leadership of Chief Executive Officer (CEO) Brent MacGregor, all employees worked hard
to deliver progress on the Group’s strategy in the year. The Group delivered strongly improved financial results
in FY24, reflecting efforts across the organisation to grow volume, improve margins, reduce costs and deliver
operational improvements.
The Group reported growth for Penthrox in Australia and Europe, and further respiratory market share gains
in the US. While good progress has been made, we were disappointed that delivered revenue for the year was
below target. A longer than expected sales cycle for Penthrox in the Australian hospital segment, where strong
lead indicators are yet to be fully reflected in volume growth, and seasonal demand softness in the Australian
Respiratory market, impacted financial outcomes in the year.
The Group reported lower than target results for EBIT and Free Cash Flow. This resulted in a Business
Performance Multiplier of 88%. Incentive outcomes for FY24 reflect the below target performance.
The Group progressed several strategic projects in the year, including the transition to a new operating model in
Europe, and planning for US market entry. Following further evaluation of resourcing requirements and funding
options to progress US market entry plans, the Group has determined to pause the commencement of the next
phase of US investment in favour of focusing on the underlying business.
Key Management Personnel (KMP) changes during FY24
During the year Dr Russell Basser joined the Board (effective 1 September 2023). Russell is a qualified physician,
with over 30 years of international medical and biopharmaceutical experience. Russell’s expertise is highly
relevant to the Group’s global expansion opportunities, including the US, as well as being complementary to the
Board’s membership and capabilities.
Remuneration in FY24
Over the last few years, the Group has improved remuneration structures for executive employees to more closely
align with the interests of shareholders. This included changes to remuneration for the CEO.
At the FY23 AGM shareholders approved changes to the CEO compensation structure. The principal objectives of
the changes were to align the CEO’s compensation more strongly with the interests of shareholders and increase
the CEO’s share ownership.
In transitioning to the new arrangements, the Group purchased 139,599 on-market shares for the CEO, equivalent
in value to the CEO’s FY23 short-term incentive award (STI) of $109,725. The CEO also voluntarily purchased
61,794 shares, equivalent in value to the after-tax proceeds of his FY23 STI. Inclusive of previously held shares,
the CEO held 226,393 shares in the Group at the end of the period. From FY24 the CEO has equity components
included in both short-term and long-term incentive arrangements. The arrangements align with the structures
in place for the rest of the executive team, and expectations of shareholders.
The CEO options program was cancelled upon transition to the new arrangements. The cancellation of the
program resulted in the recognition of a non-cash share-based payment expense of $5.1 million in the current
year. This amount, included in the Executive KMP statutory remuneration table in Section 6 of this report,
represents a non-cash accounting adjustment in accordance with AASB2 Share Based Payments. The amount
does not reflect a benefit received by the CEO in the current year.
We are confident that these changes have strengthened the Company and are in the interests of the shareholders.
Leon Hoare
Chair of Human Resources Committee
26 August 2024
28
29
AUDITED REMUNERATION REPORT
CONTENTS
1. Key Management Personnel (KMP)
2. Executive remuneration framework
3. Executive remuneration structure
4. Executive remuneration outcomes
5. Business performance
6. Statutory remuneration tables
7. Equity holdings of KMP
8. Governance
This Remuneration Report for the year ended 30 June 2024 outlines the remuneration arrangements of the Group
in accordance with the requirements of the Corporations Act 2001 (the Act) and its regulations. This information
has been audited as required by section 308(3C) of the Act.
1. Key Management Personnel (KMP)
The Remuneration Report details the remuneration arrangements of KMP who are defined as those persons
having authority and responsibility for planning, directing and controlling the major activities of the Company and
the Group, directly or indirectly, including any director (whether executive or otherwise) of the Company.
For the purposes of this report, the term KMP includes the CEO, the CFO, and all Non-Executive Directors of the
Board
There were no other changes to KMP after the reporting date and before the date the financial report was
authorised for issue.
Executive KMP employment contracts
Remuneration and other terms of employment for the CEO and CFO are formalised in employment contracts. The
material terms of the employment contracts for the Executive KMP are summarised in the table below.
Name
Position
Term as KMP in 2024
Executive KMP
Mr B MacGregor
CEO
Full Year
Ms A James
CFO
Full Year
Non-Executive Directors (NEDs)
Mr G Naylor
Non-Executive Chair
Full Year
Mr L Hoare
Non-Executive Director
Full Year
Ms C Emmanuel-Donnelly
Non-Executive Director
Full Year
Ms M Sontrop
Non-Executive Director
Full Year
Mr R Betts
Non-Executive Director
Full Year
Dr R Basser
Non-Executive Director
Appointed on
1 September 2023
CEO Contractual terms
Conditions
Duration of contract
Permanent full time employment contract until notice given by either party
Notice period
Six months’ notice by either party
Termination clauses
From 1 July 2023 the termination clause has been amended to 12 months annual
base salary averaged over the last 3 years.
CFO Contractual terms
Conditions
Duration of contract
Permanent full time employment contract until notice given by either party
Notice period
Three months’ notice by either party
30
31
2. Executive remuneration framework
The Company’s remuneration framework seeks to appropriately reward, incentivise and retain senior executives
in alignment with the interests of shareholders. The remuneration framework includes traditional fixed annual
remuneration components (including base salary, superannuation and other benefits), a STI and long-term
incentive awards (LTI).
The remuneration framework for the Company is detailed below for FY24.
Executive Remuneration Framework
Designed to drive Group Strategy and ensure that the interests of senior executives are
aligned with those of shareholders.
Governing principles of the remuneration framework
Aligns with the Group’s
purpose, culture and
strategy
Attracts, retains and
motivates capable talent
Complies with the
Group’s performance
and risk management
framework
Creation of shareholder
value
Reward framework components
Annual remuneration
STI at risk
LTI at risk
Cash salary, superannuation and other
benefits, that are reviewed on an annual
basis.
Competitively set to reward, incentivise
and retain senior executives, reflecting
the role scope and accountabilities.
Determined based on market
benchmarking, individual and
business unit performance and overall
performance of the Group.
At risk annual rewards, entitlement to
which is determined by the achievement
of financial and individual goals
against targets. These rewards align
remuneration with the achievement
of short-term strategic objectives and
financial performance.
The STI is measured as a % of fixed
annual remuneration (the target), with
payment range between 0% and 130%
of target.
To strengthen alignment with
shareholders, the STI is paid in cash and
equity (50/50) for Executive KMP and
other senior executive participants, with
the equity component subject to a 1 year
holding lock.
At risk rewards, entitlement to which
is based on the delivery of agreed
shareholder returns over an extended
period. These rewards align executive
remuneration with delivery of long-term
strategy and the creation of shareholder
wealth.
The Company introduced the LTI in FY23
for select senior executives including the
CFO, which includes provision for the
allocation of performance rights which
vest as fully paid ordinary shares on
the achievement of agreed shareholder
returns over a 3-year period. The
CEO joined the LTI in FY24 following
shareholder approval at the 2023 Annual
General Meeting.
Executive remuneration mix
The target remuneration mix of the above framework components (assuming STI at target and the face
value of LTI) in FY24 would be as follows:
Fixed Remuneration
STI cash
STI equity
LTI
CEO
CFO
67%
12%
12%
9%
71%
11%
11%
7%
The Directors believe that this mix aligns rewards with the interests of our shareholders and drives performance
against short term and long term business objectives.
3. Executive remuneration structure
Detailed components of the remuneration structure are outlined below.
Annual Remuneration
Payment vehicle
Fixed Annual Remuneration (FAR) comprising of cash salary and superannuation benefits.
Other benefits, including travel and tax advice allowances, long service leave benefits and fringe benefits
tax (FBT) benefits.
STI
Payment vehicle
CEO and CFO FY24: 50% cash and 50% equity
Opportunity
CEO: at target 35% of FAR (maximum opportunity of 45.5%), 50% payable in cash and 50% as fully paid
shares)
CFO: at target 30% of FAR (maximum opportunity of 39%), 50% payable in cash and 50% as fully paid
shares.
Performance
measures
Achievement of EBIT, free cash flow (FCF) and operational and strategic objectives, and performance in
alignment with Company values. The STI is calculated as follows:
FAR
X
STI
Target
X
Business
Performance
Multiplier
X
Individual
Performance
Multiplier
=
STI
total
Business performance multiplier (BPM)
Based on achievement of the EBIT and FCF target calculated as follows:
EBIT and FCF compared to target
BPM (50% EBIT + 50% FCF)
$3.5 million or greater below
70%
$0.5-$3.5 million below
Straight-line vesting 70-100%
Within $0.5 million
100%
$0.5-$3.5 million above
Straight-line vesting 100-130%
$3.5 million or greater above
130%
The Board may adjust from the EBIT and FCF outcomes the financial impact of non-operational or one-off
events. An adjustment may also be made based on the quality of the financial result, management of risk
and shareholder expectations.
Target = BPM of 100%, Maximum = BPM of 130%, Minimum = BPM of 70%. Equal weighting is given to the
achievement of the EBIT and free cash flow targets.
Individual performance multiplier (IPM)
Based on the participants performance rating across two dimensions, being the delivery of agreed
business objectives and alignment with Company values.
Target performance = IPM of 100%, Unsatisfactory performance = IPM of 0%, Outstanding performance =
IPM of 130%
STI (equity
component)
Payable in fully paid ordinary MVP shares. The number of shares allocated is determined by dividing the
amount payable in equity by the VWAP of MVP shares traded in the 5 trading days following announcement
of the Company’s full year results. The shares are subject to a one year holding lock.
32
33
LTI
Overview
The plan consists of performance rights granted annually. Under the plan, performance rights were
granted to the CFO and select senior executives. The CEO was also granted performance rights for the first
time in FY24. Details in relation to performance hurdles, vesting conditions and other terms and conditions
are outlined below.
Opportunity
CEO: Maximum opportunity equivalent to 50% of FAR
CFO: Maximum opportunity equivalent to 20% of FAR
Senior Executives: Maximum opportunity ranging between the equivalent of 10-20% of FAR.
Instrument
Performance rights
Performance
period
The performance period commences on the first day of the current fiscal year and is measured over a three-
year vesting period. The first testing period will be for the year ended 30 June 2025. In relation to the FY23
grant, testing occurs only once.
Allocation
approach
The number of performance rights allocated to each KMP is based on the following:
FAR
X
Individual
target %
=
LTI
participation
÷
Fair Value of each
Performance Right
=
Performance Rights
granted to KMP
The fair value of each right reflects the expected value of each right to the participant today, taking into
consideration the current share price, the performance hurdle (minimum 33% share price growth), vesting
conditions and the probability of various share price outcomes at the end of the performance period. The fair
valuation has been performed by an independent valuer.
Performance
hurdle
Vesting of rights is subject to achieving volume weighted average share price (VWAP) growth targets over a
three-year performance period.
LTI Vesting Schedule
Vesting %
VWAP share price growth up to 33%
0%
VWAP share price growth between 33% and 100%
Straight line vesting on a pro rata basis
VWAP share price growth at 100% or above
100%
If no dividends are paid over the 3-year vesting period the minimum performance hurdle would be
equivalent to delivering total shareholder return of 33%. Target performance would be equivalent to total
shareholder return of 100%.
Cessation of
Employment
If an executive resigns or is terminated for cause, any unvested LTI awards will be forfeited, unless
otherwise determined by the Board. Any such performance rights will be subject to the original terms and
conditions, and the discretion of the Board.
Rights attaching
to performance
rights
Performance rights do not carry any dividend or voting entitlements prior to vesting, or priority over any
creditors of MVP upon liquidation or winding up of MVP. Shares allocated upon vesting of performance rights
will carry the same rights as other ordinary shares.
Malus and
Clawback
At the discretion of the Board LTI awards will be forfeited where there has been any fraud, dishonesty, or
breach of obligations of the Group policies or codes of conduct.
Change of Control
Provisions
In the event of change of control, or a scheme of arrangement, selective capital reduction or other
transaction is initiated which has an effect similar to a full takeover bid for shares in the Company, then
participants are entitled to accept the takeover bid or participate in the other transaction in respect of all or
part of their awards other than exempt share awards notwithstanding that the restriction period in respect of
such awards has not expired. The Board may waive any vesting conditions at their discretion.
4. Executive remuneration outcomes
Actual remuneration received
The table below shows the remuneration the executive KMP actually received for FY24 (paid in cash or accrued),
or in the case of equity awards, the value that vested in FY24. This table differs from the statutory table included
in Section 6, in that the table below excludes remuneration from unvested share-based payments. The Directors
believe this information is helpful to shareholders.
(1) Fixed remuneration comprises base salary and post-employment benefits as disclosed in the statutory
remuneration table in Section 6.
(2) Other benefits comprises other short-term benefits and other long-term benefits as disclosed in the statutory
remuneration table in Section 6.
STI outcomes
STI awards are measured on the delivery of financial and business objectives approved by the Board at the start
of the financial year with clear alignment to strategy.
STI awards are calculated using the STI Multiplier detailed above. KMP objectives and achievement against
targets for the year are included in the table below.
Objectives
Measure
Target
Achieved
Achievement
(0-130%)
Weighting
Weighted
Outcome
EBIT
$million
(9.4)
(11.6)
83%
50%
41%
Free cashflow
$million
(12.9)
(14.0)
94%
50%
47%
Business Performance Multiplier
88%
Grow Penthrox and
Respiratory volume in key
markets(1)
% growth
Various
Partially
achieved
40%
35%
14%
Increase global Penthrox
pricing
$million
2.1
2.2
105%
20%
21%
Deliver operational
improvements and efficiency
Various
Various
Achieved
100%
15%
15%
Deliver agreed strategic
project milestones(2)
Various
Various
Partially
achieved
70%
30%
21%
Individual performance multiplier – Mr MacGregor
70%
Individual business
objectives
Various
Achieved
100%
100%
100%
Individual performance multiplier – Ms James
100%
Fixed annual
remuneration(1)
Other
Benefits(2)
STI
(cash)
STI
(equity)
Other Benefits
Total
$
$
$
$
$
$
Mr B MacGregor
629,781
64,119
68,339
68,339
109,725
940,303
Ms A James
388,207
1,155
51,582
51,582
-
492,526
(1) Includes increased penetration of Penthrox in Australia, and growth in the US Respiratory market.
(2) Specific disclosure of objectives, target milestones and achieved outcomes are not reported due to commercial
sensitivity.
34
35
5. Business performance
The table below summarises key indicators of the performance of the Company and relevant shareholder returns
over the past 5 financial years.
(1) Revenue and commentary on performance has been included above in the Review of Operations and Financial
Performance.
(2) Excludes contract termination revenue in FY21 of $8.9 million arising from the termination of the European
distribution rights for Penthrox previously held by Mundipharma. Excludes contract termination revenue of
$18.9 million in FY23 arising from the termination of agreements for the distribution of Penthrox in China
($18.5 million), and other countries where revenue opportunities are not being pursued ($0.4 million).
(3) Underlying EBIT and commentary on performance has been included above in the Review of Operations and
Financial Performance.
The tables below include details of the KMP STI outcomes for the current year.
The STI for Mr MacGregor and Ms James is payable in cash 50%; and 50% as fully paid shares.
LTI plans
The table below outlines the LTI plans that remain untested.
(1) Testing is due to occur at the end of September 2024, performance rights are not expected to vest.
The testing takes place following the three-year performance period and will be based on the VWAP of shares
traded in MVP for the 20-day trading period commencing 5 trading days after the results announcement in the
final year of the performance period. Testing occurs only once.
LTI outcomes
The table below outlines key details in relation to performance rights granted to KMP, and associated
remuneration during the current year. Each LTI allocation has a vesting period of 3 years.
Options program (CEO)
All options granted to Mr MacGregor on commencement of his employment in FY21 were cancelled in the current
year. No benefit was received by Mr MacGregor. Remuneration outcomes have been outlined in the Executive
KMP statutory remuneration table in Section 6.
Grant Date
Performance rights
granted
Fair value of rights
at grant date
Value of rights
included in
compensation for the
year
Performance period
Mr MacGregor
FY24 LTI
27 October 2023
617,620
$271,753
$90,584
1 July 2023
to 30 June 2026
Ms James
FY24 LTI
27 October 2023
152,285
$67,005
$22,335
1 July 2023
to 30 June 2026
FY23 LTI
22 December 2022
84,930
$57,752
$19,251
1 July 2022
to 30 June 2025
$41,586
Maximum STI
opportunity
STI Paid
STI earned
% of maximum
STI forfeited
% of maximum
Mr MacGregor
$286,550
$136,678
48%
52%
Ms James
$151,401
$103,164
68%
32%
Plan
Grant date
Performance period
Performance measure
Outcome
FY22 LTI
22 Dec 2022
1 July 2022 to 30 June 2024
Share price growth from
baseline share price of $4.02
Not yet tested(1)
FY23 LTI
22 Dec 2022
1 July 2022 to 30 June 2025
Share price growth from
baseline share price of $1.72
Not yet tested
FY24 LTI
27 Oct 2023
1 July 2023 to 30 June 2026
Share price growth from
baseline share price of $0.898
Not yet tested
Performance measure
2020
2021
2022
2023
2024
Revenue ($000s)1
22,535
16,329(2)
21,943
32,337(2)
33,149
Revenue growth %
7.9%
(27.5%)
34.4%
47.0%
2.5%
Underlying EBITDA (000’s)
2,695
(6,372)
(11,724)
(15,133)
(8,237)
Underlying EBIT (000’s)3
98
(10,121)
(14,669)
(18,246)
(11,631)
Reported EBIT (000’s)
98
(14,928)
(15,850)
(7,957)
(33,142)
Statutory net profit / (loss) after tax
($000’s)
379
(12,565)
(12,407)
(5,609)
(40,992)
Share price at end of period
$6.98
$4.50
$1.46
$0.78
$0.39
Total dividends (cps)
2.00
-
-
-
-
Basic earnings / (loss) per share (cps)
0.58
(18.35)
(17.41)
(6.66)
(47.50)
36
37
6. Statutory remuneration tables
Executive KMP statutory remuneration
The table below summarises remuneration to Executive KMP.
Short term benefits
Share based payments
Year
Base salary
STI
(cash)
Other
benefits(1)
Other long
term benefits(2)
Post
employment
benefits(3)
STI
(equity)
Other equity
LTI
Total excluding
accelerated
SBP expense
Accelerated
charge for
share based
payments
Total
Remuneration
linked to
performance
%
Mr B MacGregor
2024
602,382
68,339
59,222
4,897
27,399
68,339(4)
109,725(5)
90,584(6)
1,030,887
5,135,613(8)
6,166,500
22%(8)
2023
576,127
109,725
45,940
1,405
25,292
-
-
1,183,396(7)
1,941,885
-
1,941,885
67%
Ms A James
2024
349,736
51,582
-
1,155
38,471
51,582(4)
-
41,586(6)
534,112
-
534,112
27%
2023
338,182
56,054
-
560
35,509
56,053
-
19,251
505,609
-
505,609
26%
Total
Executive KMP
remuneration
2024
952,118
119,921
59,222
6,052
65,870
119,921
109,725
132,170
1,564,999
5,135,613
6,700,612
2023
914,309
165,779
45,940
1,965
60,801
56,053
-
1,202,647
2,447,494
-
2,447,494
(1) Other benefits include allowances for travel and reimbursement for tax advice for Mr MacGregor, inclusive of
FBT payable by the Company on these benefits.
(2) Represents the movement in the long service leave provision during the current period.
(3) Represents superannuation benefits paid to Mr MacGregor and Ms James.
(4) Represents a grant of fully paid shares to Mr MacGregor and Ms James, being 50% of their STI for the current
year.
(5) Represents shares purchased by the Group on market for Mr MacGregor as part of the transition to new
remuneration arrangements approved at the 2023 AGM.
(6) Represents the amortisation of the grant date fair value of performance rights granted to Mr MacGregor and
Ms James. The performance rights valuation was performed by an independent valuer, and the expense was
recognised in the FY24 statement of profit or loss and other comprehensive income over the relevant vesting
period in accordance with AASB2 Share Based Payments.
(7) Represents the amortisation of the grant date fair value of options granted to Mr MacGregor in November
2020. The valuation was performed by an independent valuer, and the expense was recognised in the
prior year statement of profit or loss and other comprehensive income over the relevant vesting period in
accordance with AASB2 Share Based Payments.
(8) Represents the share-based payment expense arising on the cancellation of all options granted under the
CEO options program (options granted to Mr MacGregor at the commencement of his employment). The
options were cancelled upon Mr MacGregor’s transition to new CEO remuneration arrangements in FY24
and approved at the 2023 AGM. The expense recognised in the period is the accelerated amortisation of the
unamortised fair value as at 30 June 2023, which has not been recognised in the statement of profit and loss
and other comprehensive income in prior periods. This is a non-cash adjustment required under AASB2
Share Based Payments and does not represent a benefit to Mr MacGregor. No options under the CEO options
program vested. The remuneration included in the calculation of “Remuneration linked to performance
percentage” excludes this expense.
38
39
6. Statutory remuneration tables (continued)
KMP performance rights holdings
The table below shows the movement in KMP performance rights holdings during the year, and the balance of
vested and unvested rights at the end of the financial year.
7. Equity holdings of KMP
The following table shows the respective shareholdings of KMP (directly and indirectly) and any movements
during the year ended 30 June 2024
(1) Mr MacGregor volunteered to purchase additional shares in the Company equivalent in value to the after-tax
proceeds of his FY23 STI.
Balance at
1 July 2023
Number
granted
Balance at
30 June 2024
Vested at
30 June 2024
Unvested at
30 June 2024
CEO
-
617,620
617,620
-
617,620
CFO
84,930
152,285
237,215
-
237,215
84,930
769,905
854,835
-
854,835
6. Statutory remuneration tables (continued)
Non-Executive KMP remuneration
The Human Resources Committee seeks to attract and retain Non-Executive Directors (NEDs) of the highest
calibre, who have the appropriate experience and expertise to oversee the governance of MVP and provide
direction to senior management on the running of the Company. NED fees are set with reference to their
responsibilities, time commitment and contribution to committees, whilst incurring a cost that is acceptable to
shareholders. NEDs do not participate in any incentive plans.
The table below summarises payments made for NED fees.
(1)
(1) The Chair of the Board receives fees of $95,000 (2023: $95,000), while remaining Board members receive fees
of $60,000 (2023: $60,000).
Non-Executive KMP
Year
Short Term
Benefits
Post-Employment
Benefits
Total(1)
Fees
$
Superannuation
$
$
Mr G Naylor(1)
2024
85,586
9,414
95,000
2023
85,973
9,027
95,000
Mr L Hoare
2024
58,513
1,487
60,000
2023
60,000
-
60,000
Ms C Emmanuel-Donnelly
2024
54,054
5,946
60,000
2023
54,299
5,701
60,000
Ms M Sontrop
2024
54,054
5,946
60,000
2023
54,299
5,701
60,000
Mr R Betts
2024
54,054
5,946
60,000
2023
54,299
5,701
60,000
Dr R Basser
(appointed 1 September 2023)
2024
45,045
4,955
50,000
2023
-
-
-
Former Non-Executive KMP
Mr D J Williams
(resigned 26 April 2024)
2024
-
-
-
2023
45,249
4,751
50,000
Mr R M Johnston
(resigned 27 October 2022)
2024
-
-
-
2023
18,100
1,900
20,000
Total Non-Executive KMP
remuneration
2024
351,306
33,694
385,000
2023
372,219
32,781
405,000
Number of shares
Balance
1 July 2023
Acquired
Allocated through
employee
remuneration
schemes
Balance
30 June 2024
Mr G Naylor
894,573
56,000
-
950,573
Mr L Hoare
62,005
-
-
62,005
Ms C Emmanuel-Donnelly
56,475
-
-
56,475
Ms M Sontrop
20,591
-
-
20,591
Mr R Betts
23,383
-
-
23,383
Dr R Basser
-
15,873
-
15,873
Mr B MacGregor
25,000
61,794(1)
139,599
226,393
Ms A James
-
-
62,982
62,982
1,082,027
133,667
202,581
1,418,275
40
41
8. Governance
The following represents MVP’s remuneration governance framework.
The HRC comprises at least three Non-Executive Directors and meet as often as the members deem necessary to
fulfil the Committee’s obligations. The HRC comprises of the following Directors, Mr Hoare (Chair), Mr Naylor and
Ms Sontrop.
External remuneration advice received in FY24
During the year the HRC did not obtain remuneration advice or recommendations from external remuneration
consultants.
MVP Board
The Board takes overall accountability for the company and is committed to the highest standard of corporate
governance. To assist in the execution of these responsibilities the Board has established the following
committees:
• Human Resources Committee (HRC)
• Audit and Risk Committee (ARC)
• Continuous Disclosure Committee (CDC)
Responsibilities of the Board include reviewing the terms and conditions of the CEO’s remuneration
and ongoing performance as well as oversight of all matters associated with the organisation’s human
resources. The Board reviews, and when appropriate, approves recommendations from the HRC in relation
to the remuneration of the CEO and executives. The Board also reviews, and when appropriate approves
recommendations from the ARC in relation to audit and risk matters.
Human Resources Committee
Audit and Risk Committee
The HRC works on behalf of the MVP Board to oversee
the Group’s human resources and remuneration
strategy in the best interests of MVP shareholders. The
Committee provides an objective review and oversight
of people and remuneration policies and frameworks so
that they:
•
Align with the Group’s purpose, culture and strategy.
•
Comply with the Group’s remuneration framework.
•
Comply with legal and regulatory requirements.
•
Remain appropriate to changing market conditions.
The Committee sets the remuneration framework and
monitors the activities listed below, including making
recommendations and providing reports to the Board
on the following:
•
The salary package of the CEO and compensation of
the non-executive directors (changes are approved
by the Board as a whole and shareholders if
required)
•
Annual remuneration for senior executives and
all other staff including, but not limited to, fixed
remuneration, short term incentives, and long-
term incentives, aligned to business strategy in the
interests of shareholders.
•
Assess remuneration practices for internal and
external alignment.
•
Recruitment, retention and termination policies and
practices for senior management.
Any other remuneration or human resources tasks
referred to the Committee by the Board.
The ARC works on behalf of the MVP Board to assist
in fulfilling its corporate governance and oversight
responsibilities in relation to the following:
•
The integrity of MVP’s financial reporting.
•
The effectiveness of MVP’s systems of financial risk
management and internal control.
•
The integrity of the external audit process.
•
MVP’s risk profile and risk policy.
•
The effectiveness of MVP’s risk management
framework and supporting risk management
systems, including work health and safety.
Continuous Disclosure Committee
The CDC acts as a delegated authority of the Board to:
•
Review and consider the materiality of potentially
disclosable information it receives to determine
whether that information is market sensitive;
•
Make recommendations to the Board as to the
content of the information to be disclosed; and
•
Approve certain disclosures on behalf of the Board
as set out in the Continuous Disclosure Policy.
External remuneration advice
External remuneration advice is sought by the HRC
and Board where necessary. The nature of the
external advice and the amounts paid to remuneration
consultants are disclosed annually in the Remuneration
Report.
KMP ordinary shares under options
The following table shows the number of options held over ordinary shares by KMP (directly and indirectly) and
any movements during the year ended 30 June 2024
(1) On acceptance by Mr MacGregor of an invitation to join the Company LTI program in the current year, options
he previously held were cancelled. These remuneration arrangements were approved at the 2023 AGM.
(2) Options attaching to shares acquired by KMP in the capital raising completed in August 2022.
Number of shares
Balance
1 July 2023
Acquired
Forfeited
Balance
30 June 2024(2)
Mr G Naylor
105,502
-
-
105,502
Mr L Hoare
9,504
-
-
9,504
Ms C Emmanuel-Donnelly
16,435
-
-
16,435
Ms M Sontrop
784
-
-
784
Mr R Betts
8,032
-
-
8,032
Dr R Basser
-
-
-
-
Mr B MacGregor
1,978,704
-
(1,968,704)(1)
10,000
2,118,961
-
(1,968,704)
150,257
42
43
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte organisation.
26 August 2024
The Board of Directors
Medical Developments International Limited
4 Caribbean Drive
Scoresby VIC 3179
Dear Board Members
Auditor’s Independence Declaration - Medical Developments International Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of
independence to the directors of Medical Developments International Limited.
As lead audit partner for the audit of the financial report of Medical Developments International Limited for the year
ended 30 June 2024, I declare that to the best of my knowledge and belief, there have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
any applicable code of professional conduct in relation to the audit.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Melanie Sutton
Partner
Chartered Accountants
Deloitte Touche Tohmatsu
ABN 74 490 121 060
477 Collins Street
Melbourne, VIC, 3000
Australia
Phone: +61 3 9671 7000
www.deloitte.com.au
18
NON-AUDIT SERVICES
During the year, the Company’s auditor, performed other assignments in addition to their statutory audit
responsibilities.
Details of the amounts paid or payable for non-audit services provided during the year are as follows:
The Directors are satisfied that the provision of non-audit services, during the year, by the auditor is compatible
with the general standard of independence for auditors imposed by the Corporations Act 2001. The directors
do not believe that the nature of these services compromises the general principles relating to auditor’s
independence, as set out by the Chartered Accountants Australia and New Zealand.
CORPORATE GOVERNANCE STATEMENT
A copy of the Company’s Corporate Governance statement can be found at
www.medicaldev.com/investors-media/corporate-governance/
AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration is included on page 43.
ROUNDING
The Company is a company of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports)
Instrument 2016/191 dated 24 March 2016, and in accordance with that Corporate Instrument, amounts in the
Directors’ Report and financial report are rounded to the nearest $1,000, unless otherwise stated.
Signed in accordance with a resolution of the Board of Directors made pursuant to s. 298(2) of the Corporations
Act 2001:
On behalf of the directors
$
2024
2023
Tax services
49,300
38,180
Other
48,828
-
Total
98,128
38,180
Gordon Naylor
Company Chair
26 August 2024
44
45
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte organisation.
Deloitte Touche Tohmatsu
ABN 74 490 121 060
477 Collins Street
Melbourne, VIC, 3000
Australia
Phone: +61 3 9671 7000
www.deloitte.com.au
Independent Auditor’s Report to the members of
Medical Developments International Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Medical Developments International Limited (the “Company”) and its
subsidiaries (the “Group”) which comprises the consolidated statement of financial position as at 30 June 2024,
the consolidated statement of profit and loss and other comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial
statements including material accounting policy information and other explanatory information, the directors’
declaration and the consolidated entity disclosure statement.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
Giving a true and fair view of the Group’s financial position as at 30 June 2024 and of its financial
performance for the year then ended; and
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our
report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are
relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in
accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report of the Group for the current period. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion
on these matters.
19
Key Audit Matter
How the scope of our audit responded
to the Key Audit Matter
Capitalisation of intangible assets
Refer to Note 2.3 Non-Current Assets and Note 1.1 Group Results
As at 30 June 2024, the Group holds $16.0 million of capitalised
registration costs and $1.0 million of capitalised development
costs. $13.9 million of capitalised registration costs and $1.9
million of capitalised development costs were impaired during
the year due to no longer meeting the criteria to be capitalised.
Accounting standards require management to use their
judgement to determine:
Whether expenditure relates to development activities or
research activities.
The technical feasibility of completing the intangible asset
so that it will be available for use.
Whether the Group intends to complete the intangible asset
and either use or sell it.
The probability of expected future economic benefits
flowing to the Group.
The availability of resources to complete the development
and to use or sell the intangible asset.
The expenditure attributable to the asset during its
development.
Whether the useful life assigned to each asset is
appropriate.
Where expenditure does not meet the recognition criteria under
accounting standards or has historically been capitalised and no
longer meets these criteria, it should be expensed or impaired.
Our procedures included:
Obtaining an understanding of the process
undertaken by management to determine whether
expenditure should be capitalised as an intangible
asset.
Assessing the appropriateness of management’s
accounting
policy
for
capitalisation
and
management’s application of that policy with respect
to current year additions to intangible assets.
Assessing all capitalised intangible assets not yet
available for use and a sample of capitalised
intangible assets in use at balance date to determine
whether it is probable that expected future
economic benefits attributable to those assets will
flow to the Group.
Assessing management’s identification of intangible
assets no longer meeting the recognition criteria
under accounting standards.
Reviewing the listing of capitalised intangible assets
at balance date to verify that:
o
Amortisation has commenced on intangible
assets that are in use, and
o
The useful lives assigned to assets in use are
appropriate.
Evaluating the appropriateness of the disclosures
included in Note 1.1 and 2.3 to the financial
statements.
Carrying value of the Pain Management cash generating unit
Refer to Note 2.3 Non-Current Assets
As at 30 June 2024, the carrying value of the Pain Management
group of cash generating units (“CGU”) included $3.8 million of
goodwill. Goodwill and intangible assets not yet available for use
are required to be assessed for impairment annually and
whenever there is an indicator of impairment.
The recoverable amount of the Pain Management CGU has been
determined by management based on a value in use (“ViU”)
model, which incorporates significant judgement related to the
estimation of future cash flows, short term growth rates, long
term growth rates and an appropriate discount rate.
The Group’s estimate of recoverable amount for the Pain
Management CGU is based on future cash flows which are
contingent upon the Group continuing to grow in established
markets such as Australia and the United Kingdom in the short
to medium term.
Our audit procedures included:
Understanding
management’s
processes
and
controls related to the preparation of the value in use
models for the Pain Management CGU.
Agreeing forecast cash flows to the latest Board
approved budget for FY25 and the Group’s longer
term business plans, assessing the reasonableness of
the forecast cash flows with reference to current
performance and drivers of expected future
performance.
In conjunction with our valuation specialists,
assessing
the
ViU
methodology
used
by
management, testing the mathematical integrity of
management’s VIU model, as well as comparing the
discount rates and long-term growth rates used to
external benchmark data.
Performing sensitivity analysis on the impairment
model by applying varied discount rates and growth
projections to simulate alternative market conditions
and outcomes.
Evaluating the appropriateness of the disclosures
included in Note 2.3 to the financial statements.
46
47
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Group’s annual report for the year ended 30 June 2024 but does not include the financial report and our
auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed,
we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors are responsible:
For the preparation of the financial report in accordance with the Corporations Act 2001, including giving
a true and fair view of the financial position and performance of the Group, in accordance with Australian
Accounting Standards; and
For such internal control as the directors determine is necessary to enable the preparation of the financial
report in accordance with the Corporation Act 2001, including giving a true and fair view of the financial
position and performance of the Group, and is free from material misstatement, whether due to fraud or
error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group 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 has no realistic
alternative but to do so.
Liquidity
As disclosed in Note 3.4 the Group had a cash balance of $9.7
million at 30 June 2024, and net operating cash outflows of $10.8
million. Subsequent to year-end, the Group announced a fully
underwritten capital raise of approximately $10 million
comprising an institutional placement and non-renounceable
entitlement offer to accelerate growth and improve balance
sheet strength. The institutional component of the placement
was completed on 30 July 2024 with gross proceeds of $6.9
million being received. The entitlement offer closed on 22
August 2024, with gross proceeds of $3.1 million expected to be
received on 27 August 2024.
The Group continues to closely manage its ongoing liquidity as
disclosed in Note 3.4 to the financial statements. This requires
the achievement of cash flow forecasts which are subject to
variation due to factors which are outside the control of the
Group, to enable the Group to continue to meet its operating
cash commitments.
Our procedures included:
Comparing the Group’s forecast cash flows against
the FY25 Board approved budget and testing the
accuracy of the model.
Challenging the key assumptions in management’s
forecast cash flows for the 12 months following
approval of the financial report.
Assessing the capital raise undertaken subsequent to
year-end by reading and understanding the key
terms of the underwriting agreement, examining
market announcements made by the Group and
vouching the gross proceeds net of costs from the
institutional placement to the Group’s bank
statement.
Assessing consistency between the forecasts used to
test the Group’s going concern basis and those used
in management’s annual impairment testing.
Performing sensitivity analysis on the cash flow
forecast for a range of reasonable possible scenarios.
We also assessed the adequacy of the disclosures included
in Note 3.4 to the financial statements.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and
maintain professional 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 internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the 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’s audit. We remain solely responsible for our audit
opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards
applied.
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.
48
49
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 6 to 16 of the Directors’ Report for the year ended
30 June 2024.
In our opinion, the Remuneration Report of Medical Developments International Limited, for the year ended 30
June 2024, complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
DELOITTE TOUCHE TOHMATSU
Melanie Sutton
Partner
Chartered Accountants
Melbourne, 26 August 2024
27 to 41
50
51
Consolidated Statement of Profit or Loss and
other Comprehensive Income
For the year ended 30 June 2024
(1) Employee benefits expense includes $5.1 million share-based payment expense in the current year in relation to the cancellation
of options granted to the CEO on commencement of his employment in FY21. The cancellation of options was approved at the 2023
AGM as part of the transition to new remuneration arrangements for the CEO. The expense recognised in the year is the unamortised
amount of the fair value of the equity instruments (valued at the date the instruments were granted) that has not been recognised in the
Consolidated Statement of Profit or Loss and Other Comprehensive Income in prior periods. This is a non-cash adjustment and does not
represent a benefit to the CEO.
The Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction
with the accompanying notes.
$’000
Notes
2024
2023
Revenue
1.1, 1.2
33,149
32,337
Contract termination revenue
1.1, 1.2
-
18,928
Raw materials and consumables used
(8,783)
(10,125)
Employee benefits expense(1)
(23,472)
(21,615)
Distribution expenses
(2,822)
(3,825)
Regulatory and registration expenses
(2,472)
(2,969)
Occupancy, selling and administration expenses
(9,073)
(10,963)
Interest and other income
402
657
Depreciation and amortisation expense
(3,394)
(3,113)
Impairment expense
1.1
(16,375)
(6,709)
Finance costs
(86)
(95)
Loss before income tax expense
(32,926)
(7,492)
Income tax (expense) / benefit
1.3
(8,066)
1,883
Net loss for the year
(40,992)
(5,609)
Net loss attributable to equity holders of the parent entity
(40,992)
(5,609)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss, net of tax
Foreign currency translation (losses) / gains
78
(75)
Total comprehensive loss for the year
(40,914)
(5,684)
Total comprehensive loss attributable to equity holders of the parent
entity
(40,914)
(5,684)
cents
Basic earnings / (loss) per share
1.1
(47.50)
(6.66)
Diluted earnings / (loss) per share
1.1
(47.50)
(6.66)
Consolidated Statement of Financial Position
For the year ended 30 June 2024
$’000
Notes
2024
2023
CURRENT ASSETS
Cash and cash equivalents
9,735
24,661
Trade and other receivables
2.1
7,071
8,932
Inventories
2.1
8,771
8,378
Prepayments
565
791
TOTAL CURRENT ASSETS
26,142
42,762
NON-CURRENT ASSETS
Plant and equipment
2.3
10,162
12,122
Goodwill and other intangible assets
2.3
22,857
38,317
Deferred tax assets
1.3
-
8,112
TOTAL NON-CURRENT ASSETS
33,019
58,551
TOTAL ASSETS
59,161
101,313
CURRENT LIABILITIES
Trade and other payables
2.1
8,254
14,186
Employee benefits provisions
4.1
639
727
Lease liabilities
2.5
371
352
Unearned income
2.2
283
283
TOTAL CURRENT LIABILITIES
9,547
15,548
NON-CURRENT LIABILITIES
Employee benefits provisions
4.1
309
343
Unearned income
2.2
1,637
1,899
Lease liabilities
2.5
1,915
2,208
Deferred tax liabilities
1.3
19
-
TOTAL NON-CURRENT LIABILITIES
3,880
4,450
TOTAL LIABILITIES
13,427
19,998
NET ASSETS
45,734
81,315
EQUITY
Contributed equity
3.2
105,729
105,729
Reserves
3.2
2,864
5,740
Accumulated losses
(62,859)
(30,154)
TOTAL EQUITY
45,734
81,315
The Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
52
53
$’000
Contributed
equity
Accumulated
losses
Share based
payments
reserve
CSIRO option
reserve
Foreign
currency
translation
reserve
Total
equity
Year ended 30 June 2024
As at 1 July 2023
105,729
(30,154)
3,940
1,866
(66)
81,315
Loss for the year
-
(40,992)
-
-
-
(40,992)
Other comprehensive gain
-
-
-
-
78
78
Total comprehensive (loss) / income
-
(40,992)
-
-
78
(40,914)
Share based payments expense
-
-
5,866(1)
-
-
5,866
Shares acquired by Employee Share Trust
-
-
(533)(2)
-
-
(533)
Transfer from reserves to equity
-
8,287
(8,287)
-
-
-
Transactions with owners in their capacity as
owners
-
8,287
(2,954)
-
-
5,333
Balance as at 30 June 2024
105,729
(62,859)
986
1,866
12
45,734
Year ended 30 June 2023
As at 1 July 2022
76,992
(24,545)
2,976
1,866
9
57,298
Loss for the year
-
(5,609)
-
-
-
(5,609)
Other comprehensive loss
-
-
-
-
(75)
(75)
Total comprehensive loss
-
(5,609)
-
-
(75)
(5,684)
Share based payments expense
-
-
964
-
-
964
Shares issued
30,000
-
-
-
-
30,000
Equity raising costs
(1,684)
-
-
-
-
(1,684)
Tax on equity raising costs
421
-
-
-
-
421
Transactions with owners in their capacity as
owners
28,737
-
964
-
-
29,701
Balance as at 30 June 2023
105,729
(30,154)
3,940
1,866
(66)
81,315
(1) During the current year the CEO joined the Group’s long term incentive (LTI) program that was established in FY23,
and was granted 617,620 performance rights with a target hurdle aligned to share price growth over a three year
period. On acceptance of the invitation to join the LTI program, options previously held by the CEO were cancelled.
These remuneration arrangements were approved at the 2023 AGM. The Group has recorded a $5.1 million share-
based payment expense in the current year in relation to this cancellation. The expense recognised in the year is the
unamortised amount of the fair value of the equity instruments (valued at the date the instruments were granted) that
has not been recognised in the Statement of Profit or Loss and Other Comprehensive Income in prior periods. This is
a non-cash adjustment and does not represent a benefit to the CEO. On cancellation, the total fair value of the options
recognised in the share-based payment reserve of $8.3 million was transferred to accumulated losses. An additional
share-based payment expense of $0.8 million was recognised in the year for other incentive programs and remuneration
arrangements for the CEO and select executives who participate in these programs.
(2) During the current year the Group purchased its own shares on market at a value of $0.5 million for the purpose of
allocating these shares to eligible employees under the Group’s incentive plans and arrangements. As at 30 June 2024, all
shares purchased on market have been issued to eligible employees.
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
$’000
Notes
2024
2023
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
34,762
29,075
Payments to suppliers and employees
(45,746)
(46,259)
Receipts from government grants
34
218
Income tax paid
(46)
-
Interest received
302
566
Interest paid
(86)
(95)
Net cash flows used in operating activities
3.1
(10,780)
(16,495)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for plant and equipment
(793)
(1,784)
Payments for other intangible assets
(2,376)
(5,881)
Net cash flows used in investing activities
(3,169)
(7,665)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issue of shares
3.2
-
30,000
Payment for shares acquired by the employee trust
(533)
-
Share issue transaction costs
3.2
-
(1,684)
Repayment of lease liabilities
3.5
(274)
(253)
Net cash flows (used in) / generated by financing activities
(807)
28,063
Net increase / (decrease) in cash and cash equivalents
(14,756)
3,903
Cash and cash equivalents at the beginning of the year
24,661
20,398
Effect of exchange rate changes on cash and cash equivalents
(170)
360
Cash and cash equivalents at the end of the year
9,735
24,661
The Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
Consolidated Statement of Cash Flows
For the year ended 30 June 2024
Consolidated Statement of Changes in Equity
For the year ended 30 June 2024
54
55
NOTES TO THE FINANCIAL STATEMENTS
Section 1 – Performance
This section highlights the results and performance of the Group for the year ended 30 June 2024.
1.1 GROUP RESULTS
MVP’s chief operating decision maker is the Group’s CEO. The Group’s CEO monitors results by reviewing the
Group’s reportable segments from a product perspective as outlined in the table below:
(1) Earnings before finance costs, net of interest income, tax, depreciation and amortisation and underlying
adjustments.
(2) Earnings before finance costs, net of interest income, tax and underlying adjustments.
(3) Other comprises unallocated costs associated with corporate overheads, and in the prior period minor costs
in relation to the Veterinary business which was discontinued during the 2022 financial year.
(4) Excludes Contract termination revenue arising from the termination of agreements for the distribution of
Penthrox in China ($18.5 million), and other countries where revenue opportunities are not being pursued
($0.4 million).
A reconciliation between the Group’s segment information (which excludes underlying adjustments) and
reported financial information as disclosed in the Consolidated Statement of Profit or Loss and Other
Comprehensive Income is presented below.
The financial information below reflects the segment results reported to and monitored by the CEO:
Reportable Segments
Products/Services
Regions of Operation
Pain Management
The manufacture and sale
of Penthrox®
•
Australia
•
Europe
•
Middle East
•
Canada
•
Asia
•
South Africa
•
United Kingdom
Respiratory
The sale of respiratory
devices for use by sufferers
of asthma and chronic
obstructive pulmonary
disease (COPD)
•
Australia
•
Europe
•
Canada
•
Asia
•
United Kingdom
•
USA
Year ended 30 June 2023
Revenue(4)
20,448
11,720
169
32,337
Underlying EBITDA(1)
(9,716)
1,498
(6,915)
(15,133)
Underlying EBIT(2)
(12,299)
1,250
(7,197)
(18,246)
$’000
Pain
Management
Respiratory
Other(3)
Total
Year ended 30 June 2024
Revenue
21,296
11,853
-
33,149
Underlying EBITDA(1)
(1,139)
974
(8,072)
(8,237)
Underlying EBIT(2)
(3,852)
762
(8,541)
(11,631)
Net loss after tax
Set out below is a reconciliation between underlying EBITDA and net loss after tax as disclosed in the
Consolidated Statement of Profit or Loss and Other Comprehensive Income:
Earnings per share is calculated by dividing the net loss for the year attributable to ordinary equity holders of MVP
by the weighted average number of ordinary shares outstanding during the year.
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to include
the weighted average number of additional ordinary shares that would have been outstanding assuming the
conversion of all dilutive shares. This includes performance rights granted, CSIRO options and options granted to
the CEO (until cancelled in the current year).
(1) Share-based payment expense arising from the cancellation of options as part of the transition to new CEO
remuneration arrangements approved by shareholders at the 2023 AGM. This is a non-cash adjustment and
does not represent a benefit to the CEO.
(2) Impairment of capitalised development costs relating to US market entry, including US market registration
costs ($13.9 million) and development costs for the next generation device ($1.9 million), in the Pain
Management segment. The prior year impairment charges relate to the cessation of registration activity in
China ($5.7 million), and other countries ($0.9 million) where revenue opportunities are no longer being
pursued. There was also a $0.1 million impairment in relation to patents and trademarks.
(3) Impairment of redundant plant & equipment in the Pain Management segment.
(4) Contract termination revenue arising from the termination of agreements for the distribution of Penthrox in
China ($18.5 million), and other countries where revenue opportunities are not being pursued ($0.4 million).
(5) Costs to complete a comprehensive commercial market assessment for Penthrox in the US.
Basic and diluted earnings per share
$’000
2024
2023
Earnings / (loss) per share (EPS) (cents) - Basic
(47.50)
(6.66)
Earnings / (loss) per share (EPS) (cents) - Diluted
(47.50)
(6.66)
Calculated using:
• Net loss attributable to ordinary equity holders ($’000)
(40,992)
(5,609)
• Weighted average of ordinary shares (shares) - Basic
86,305,215
84,274,349
• Weighted average of ordinary shares (shares) - Diluted
86,305,215
84,274,349
$’000
2024
2023
Underlying EBITDA
(8,237)
(15,133)
Depreciation and amortisation expense
(3,394)
(3,113)
Underlying EBIT
(11,631)
(18,246)
Share based payment expense arising from cancellation of options(1)
(5,136)
-
Impairment losses - Capitalised registration costs(2)
(15,804)
(6,709)
Impairment losses - Plant & equipment(3)
(571)
-
Contract termination revenue - Pain Management segment(4)
-
18,928
Commercial Market Assessment Costs(5)
-
(1,930)
Total underlying adjustments
(21,511)
10,289
Reported EBIT
(33,142)
(7,957)
Net interest
216
465
Net loss before tax
(32,926)
(7,492)
Income tax (expense) / benefit
(8,066)
1,883
Net loss after tax
(40,992)
(5,609)
56
57
1.2 REVENUE FROM CONTRACTS WITH CUSTOMERS
Set out below is an overview of revenue from contracts with customers based on their geographic location:
Disaggregation of revenue from contracts with customers
(1) There are no sales between reportable segments.
(2) The Group has no individual customers who contributed 10% or more to total revenue in the 2024 fiscal year
(2023: nil).
(3) Revenue from customers with contracts in the Pain Management segment includes deferred revenue from
upfront and milestone payments (ROW) of $0.2 million (2023: $0.7 million, including ROW $0.5 million and
Europe $0.2 million).
(4) Other comprises the Veterinary business which was discontinued during the 2022 financial year.
(5) Contract termination revenue arising from the termination of agreements for the distribution of Penthrox in
China ($18.5 million), and other countries where revenue opportunities are not being pursued ($0.4 million).
Year ended 30 June 2023
Australia
9,649
3,806
169
13,624
Europe
5,656
2,337
-
7,993
United States
-
4,590
-
4,590
Rest of the World
5,143
987
-
6,130
Revenue(1)(2)(3)
20,448
11,720
169
32,337
Contract termination revenue(5)
18,928
-
-
18,928
Total
39,376
11,720
169
51,265
$’000
Pain
Management
Respiratory
Other(4)
Total
Year ended 30 June 2024
Australia
12,290
3,074
-
15,364
Europe
6,145
1,272
-
7,417
United States
-
6,278
-
6,278
Rest of the World
2,861
1,229
-
4,090
Revenue(1)(2)(3)
21,296
11,853
-
33,149
How MVP accounts for revenue
Sale of goods
Revenue from the sale of goods is recognised when the Group has transferred control of the product
to the buyer. The sole performance obligation relates to the delivery of the product with no after sales
service embedded or attached to the underlying sale. Settlement and volume discounts granted to
customers are accounted for as offsets against sales.
Upfront and milestone income
Revenue from upfront and milestone payments is recognised as deferred revenue (revenue received
in advance) and amortised to profit or loss over the underlying contract term. As the performance
obligation represents the provision of a time-based right for the Groups’ partners to exclusively sell
product in a specific market, the consumption of the right and benefit occurs evenly over the contract
period. If the agreement to which the payments relate is terminated or distribution is otherwise ceased,
and there is no obligation to refund any of the amounts received, the deferred revenue will be recognised
immediately in the Consolidated Statement of Profit and Loss and Other Comprehensive Income.
The tax rate used in the above reconciliation is the corporate tax rate of 25% (2023: 25%) applicable to base rate
entities under Australian tax law.
(1)Non-deductible expenses in the current year primarily relates to share based payment expenses
(2)Due to uncertainties with respect to the utilisation of tax losses in the future, the Group has derecognised from
tax assets tax losses carried forward from prior periods of $13.7 million and has not recognised current year
tax losses of $1.3 million as deferred tax assets.
1.3 TAXATION
Reconciliation of income tax benefit
$’000
2024
2023
Accounting loss before tax
(32,926)
(7,492)
Income tax benefit calculated at 25% (2023: 25%)
(8,232)
(1,873)
Research and development benefit
(59)
(106)
Non-deductible expenses(1)
1,437
294
Current year tax losses not recognised
1,279
-
Derecognition of prior period tax losses(2)
13,734
-
Adjustments in respect of income tax of previous years
(65)
(124)
Effect of different tax rates of subsidiaries in other jurisdictions
(28)
(74)
Income tax expense / (benefit)
8,066
(1,883)
Comprising of:
Current year income tax expense
(2,008)
741
Deferred income tax benefit
(3,595)
(2,500)
Derecognition of prior period tax losses
13,734
-
Adjustments in respect of income tax of previous years
(65)
(124)
58
59
$’000
2024
2023
Deferred tax assets
Temporary differences
2,606
2,551
Tax losses
2,008
13,734
4,614
16,285
Deferred tax liabilities
Temporary differences
(4,633)
(8,173)
Net deferred tax (liability) / asset
(19)
8,112
Recognised current and deferred tax assets and liabilities
At the reporting date, the group has unused tax losses of $17.0 million available for offset against future profits.
A deferred tax asset has been recognised in respect of $2.0 million of such losses to the extent they offset future
taxable temporary differences. A deferred tax asset has not been recognised for the remaining unused tax losses
of $15.0 million due to uncertainties with respect to the utilisation of tax losses in the future. The tax losses can be
carried forward indefinitely.
Set out below are the deferred tax assets and liabilities recognised by the Group and movements during the year:
Year ended 30 June 2023
Deferred tax assets / (liabilities)
Accrued expenses
201
885
1,086
Deferred revenue
5,422
(4,876)
546
Lease liabilities
703
(63)
640
Right of use assets
(565)
68
(497)
Other intangibles
(8,262)
796
(7,466)
Property, plant and equipment
(126)
101
(25)
Provisions
442
(163)
279
Brand names
(185)
-
(185)
Tax losses
7,982
5,752
13,734
5,612
2,500
8,112
Year ended 30 June 2024
Deferred tax assets / (liabilities)
Accrued expenses
1,086
112
1,198
Deferred revenue
546
(66)
480
Lease liabilities
640
(68)
572
Right of use assets
(497)
67
(430)
Other intangibles
(7,466)
3,473
(3,993)
Property, plant and equipment
(25)
-
(25)
Provisions
279
77
356
Brand names
(185)
-
(185)
Tax losses
13,734
(11,726)
2,008
8,112
(8,131)
(19)
$’000
Opening
balance
Charged to
income
Closing
balance
How MVP accounts for taxation
Income tax charges:
• Comprise of current and deferred income tax charges and represent the amounts expected to be paid
to and recovered from the taxation authorities in the jurisdictions that MVP operates.
• Are recorded in Equity when the underlying transaction that the tax is attributable to is recorded
within Other Comprehensive Income.
MVP uses the tax laws in place or those that have been substantively enacted at reporting date to
calculate income tax. For deferred income tax, MVP also considers whether these tax laws are expected
to be in place when the related asset is realised or liability is settled. Management periodically re-
evaluate their assessment of their tax positions, in particular where they relate to specific interpretations
of applicable tax regulation.
Deferred tax assets and liabilities are recognised on all assets and liabilities that have different carrying
values for tax and accounting, including those arising from a single transaction, except for the initial
recognition of goodwill.
Specifically, for deferred tax assets:
• They are recognised only to the extent that it is probable that there are sufficient future taxable
amounts to be utilised against. This assessment is reviewed at each reporting date.
• They are offset against deferred tax liabilities in the same tax jurisdiction, when there is a legally
enforceable right to do so.
Research and development (R&D) tax credits receivable as compensation for expenses or losses
already incurred by the Group with no future related costs are recognised in profit or loss in the period
in which they are quantified and become receivable. The Group applies the income tax approach for
the accounting and presentation of the R&D tax credit. Accordingly, the tax benefit is presented as a
reduction of income tax expense in the Statement of Profit or Loss and Other Comprehensive Income.
The Group is not currently in the scope of the Pillar Two top up tax being implemented in Australia.
Key Estimates and Judgements – Taxation
The carrying amount of deferred tax assets are reviewed at the end of each reporting period and
reduced to the extent that it is no longer probable that sufficient taxable profits will eventuate
to enable recovery of the asset, or to the extent that the entity has sufficient taxable temporary
differences. In assessing the recoverability of deferred tax assets in respect of tax losses, the
Group considers the pattern of historical tax losses, and profit forecasts. The Group continues to
recognise a deferred tax asset or deferred tax liability in relation to timing differences.
Deferred tax assets
Due to uncertainties with respect to the utilisation of tax losses in the future, the Group has derecognised $13.7
million of unused historical tax losses from prior periods and have not recognised $1.3 million of current year tax
losses. The Group continues to recognise a deferred tax asset or deferred tax liability in relation to temporary
differences and tax losses to the extent they offset future taxable temporary differences.
1.4 DIVIDENDS
No interim or final dividend was paid in the current year (2023 nil).
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61
Section 2 – Operating Assets and Liabilities
This section highlights the primary operating assets used and liabilities incurred to support the Group’s
operating activities.
2.1 WORKING CAPITAL
Trade and other receivables
Trade and other receivables at balance date comprise of:
(1) Below is a breakdown of the ageing of trade receivables:
The average credit period on sales of goods to domestic customers is 30 days, international customers 60 days.
No interest is charged on trade receivables.
The Group has a number of mechanisms in place which assist in minimising financial losses due to customer non-
payment. These include:
• all customers who wish to trade on credit terms are subject to strict credit verification procedures, which may
include an assessment of their independent credit rating, financial position, past experience and industry
reputation;
• individual risks limits, which are regularly monitored in-line with set parameters; and
• monitoring receivable balances on an ongoing basis.
Expected credit loss model
Information about the credit risk exposure on the Group’s trade receivables using a provision matrix has not been
disclosed due to the immaterial amount of expected credit losses as at 30 June 2024.
Ageing of trade receivables as at 30 June ($’000)
$’000
2024
2023
Trade receivables(1)
6,973
8,769
Allowance for expected credit losses
(17)
-
Other receivables
115
163
Total current trade and other receivables
7,071
8,932
0-30
30-60
4,509
6,936
1,711
1,273
524
212
371
61-90
>90
Days
2024
2023
189
How MVP accounts for trade and other receivables
MVP’s trade receivables are non-interest bearing, are initially recorded at fair value and include Goods
and Services Tax (GST). Trade receivables are subsequently measured at amortised cost using the
effective interest method, less and allowance for expected credit losses.
The Group assesses the expected credit losses associated with its trade and other receivables on a
forward-looking basis. The Group applies the simplified approach to measuring expected credit losses,
which requires expected lifetime losses to be recognised from initial recognition of the receivables.
To measure the expected credit losses, trade and other receivables that share similar credit risk
characteristics and days past due are grouped and then assessed for collectability as a whole.
The Group continues to assess the risk of non-recoverability or expected credit loss on its receivables
to be very low. Trade receivables are typically collected within a 30-90-day period and despite the
occasional debtor being slow paying, empirical evidence suggests there has been a very low level of
credit losses in previous years.
How MVP accounts for inventories
Inventories are valued at the lower of cost and net realisable value. Costs, including an appropriate
portion of fixed and variable overhead expenses, are assigned to inventory on hand by the method
most appropriate to each particular class of inventory (all being valued on a first in first out basis). Net
realisable value represents the estimated selling price less all estimated costs of completion and costs
to be incurred in marketing, selling and distribution.
How MVP accounts for Trade and other payables
Trade and other payables are carried at their principal amounts, are not discounted and include GST.
They represent amounts owed for goods and services provided to the Group prior to, but were not paid
for, at the end of the financial year. The amounts are generally unsecured and are usually paid within 30 –
90 days of recognition.
Inventories
Inventories at balance date comprise of:
Trade and other payables
Current trade and other payables at balance date comprise of:
There is no interest is charged on trade payables. The Group has financial risk management policies in place to
ensure that all payables are paid within the credit timeframe.
$’000
2024
2023
Raw materials
1,889
2,414
Work in progress
1,451
2,932
Finished goods
5,431
3,032
Total inventories
8,771
8,378
$’000
2024
2023
Trade payables
8,254
13,324
Other payables
-
862
Total current trade and other payables
8,254
14,186
62
63
2.2 UNEARNED INCOME
Unearned income at balance date comprise of:
(1) Unearned income represents upfront unamortised payments in relation to licensing and distribution
agreements for Penthrox®. These non-refundable payments are deferred and amortised over the term of
the agreement to which the payments relate, or immediately if the agreement is terminated or distribution is
otherwise ceased.
(2) Unearned government grant income represents funds received through the Commercial Ready Programme
from the Federal Government, Futures Industries Manufacturing Program of the Victorian State Government
and various other government funding initiatives.
2.3 NON-CURRENT ASSETS
Property, plant and equipment
The key movements over the year were as follows:
$’000
2024
2023
Revenue received in advance(1)
1,595
1,792
Unearned government grant income(2)
325
390
Total unearned income
1,920
2,182
Current
283
283
Non-current
1,637
1,899
$’000
Leasehold
improvements
Plant and
equipment(1)
Right of use
asset
Total
Estimated useful life
5-10 years
4-12 years
4-12 years
Year ended 30 June 2024
At 1 July 2023 net of accumulated depreciation
196
9,936
1,990
12,122
Additions
3
447
-
450
Impairment
-
(571)
-
(571)
Depreciation charge for the year
(36)
(1,531)
(272)
(1,839)
At 30 June 2024 net of accumulated depreciation
163
8,281
1,718
10,162
Represented by:
•
at cost
354
19,276
3,074
22,704
•
Accumulated depreciation
(191)
(10,995)
(1,356)
(12,542)
Year ended 30 June 2023
At 1 July 2022 net of accumulated depreciation
158
9,133
2,261
11,552
Additions
10
2,113
-
2,123
Transfers
62
(62)
-
-
Depreciation charge for the year
(34)
(1,248)
(271)
(1,553)
At 30 June 2023 net of accumulated depreciation
196
9,936
1,990
12,122
Represented by:
•
at cost
351
18,829
3,074
22,254
•
Accumulated depreciation
(155)
(8,893)
(1,084)
(10,132)
(1) Includes capital works in progress of $0.3 million (2023: $1.6 million).
Key Estimates and Judgements
Estimation of useful lives of assets
The estimation of the useful lives of assets, excluding the right-of-use (ROU) assets, is based on
historical experience. In addition, the condition of the assets is assessed each reporting period
and considered against the remaining useful life. Adjustments to useful lives are made when
considered necessary.
The estimation of the useful lives of ROU assets is based on the non-cancellable period of the
lease plus renewal options when the exercise of the option is considered to be reasonably certain.
Key Estimates and Judgements
Recoverability of property, plant and equipment
The Group assesses impairment of all assets at each reporting date by evaluating conditions
specific to the Group and to the particular asset that may lead to impairment. These include
product and manufacturing performance, technology, social, economic and political environments
and future product expectations. If an impairment trigger exists, the recoverable amount of the
asset is determined to assess if any impairment is required.
How MVP accounts for property plant and equipment
Property, plant and equipment is stated at cost less accumulated depreciation and any accumulated
impairment losses. Cost includes expenditure directly attributable to the acquisition of the item and
subsequent costs incurred to replace parts that are eligible for capitalisation. Depreciation is calculated
on a straight-line basis over the estimated useful life of the assets.
ROU assets are measured at cost comprising the following:
• the amount of the initial measurement of lease liability;
• any lease payments made at or before the commencement date less any lease incentives;
• any initial direct costs; and
• estimated restoration costs.
ROU assets are subsequently measured at cost less accumulated depreciation and impairment losses,
with depreciation recognised on a straight-line basis over the lease term.
The Group assesses at each reporting date whether there is an indication that an asset with a finite life
may be impaired. If any such indication exists, the Group makes an estimate of the asset’s recoverable
amount. An asset’s recoverable amount is the higher of its fair value less costs to sell and its value in
use and is determined for an individual asset, unless the asset generates cash inflows that are largely
dependent on those from other assets or groups of assets and the asset’s value in use cannot be
estimated to approximate its fair value. In such cases the asset is tested for impairment as part of the
CGU to which it belongs. When the carrying amount of an asset or CGU exceeds its recoverable amount,
the asset or CGU is considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. Impairment losses are recognised in the Consolidated Statement of Profit or Loss
and Other Comprehensive Income.
An assessment is also made at each reporting date as to whether there is any indication that previously
recognised impairment losses may no longer exist or may have decreased. If such an indication exists,
the recoverable amounts are estimated. A previously recognised impairment loss is reversed only if
there has been a change in the estimates used to determine the asset’s recoverable amount since the
last impairment loss was recognised. If this is the case the carrying amount of the asset is increased to
its recoverable amount. The increased amount cannot exceed the carrying amount that would have been
determined, net of depreciation, had no impairment loss been recognised for the asset in prior years.
64
65
Goodwill and other intangibles
Goodwill and other intangible assets are comprised of the following:
(1) The carrying value for capitalised registration costs across regions comprises: Europe $15.9 million, other
countries $0.1 million (2023: Europe $16.2 million, USA $13.5 million, other countries $0.2 million)
(2) Other intangibles include Brand names of $738,000 with an indefinite life (2023: $738,000)
(3) The Group announced in April 2024 it is pausing activity on US market entry, however, there remains a
strategic intent to pursue market entry in the future. Subsequently the Group has recognised an impairment
of capitalised development costs in the current year relating to the US market entry, including US market
registration costs ($13.9m) and development costs for the next generation device ($1.9m). The impairment
loss was recognised in the Pain Management segment.
(4) The impairment loss recognised in the prior year relates to the write down of capitalised registration costs in
the Pain Management segment after the Group ceased registration activity in China ($5.7 million), and other
countries ($0.9 million), and a $0.1 million impairment in relation to patents and trademarks.
$’000
Development
Patents and
trademarks
Capitalised
registration
costs(1)
Other(2)
intangibles
Goodwill
Total
Year ended 30 June 2024
At 1 July 2023 net of
accumulated amortisation
and impairment
2,848
1,053
29,853
755
3,808
38,317
Additions
321
319
1,259
-
-
1,899
Impairment(3)
(1,851)
-
(13,953)
-
-
(15,804)
Amortisation
(313)
(123)
(1,119)
-
-
(1,555)
At 30 June 2024 net of
accumulated amortisation
and impairment
1,005
1,249
16,040
755
3,808
22,857
Represented by:
•
At cost
10,315
2,409
46,180
755
9,095
68,754
•
Accumulated
amortisation and
impairment
(9,310)
(1,160)
(30,140)
-
(5,287)
(45,897)
Year ended 30 June 2023
At 1 July 2022 net of
accumulated amortisation
and impairment
2,411
999
32,714
755
3,808
40,687
Additions
673
298
4,928
-
-
5,899
Impairment(4)
-
(112)
(6,597)
-
-
(6,709)
Amortisation
(236)
(132)
(1,192)
-
-
(1,560)
At 30 June 2023 net of
accumulated amortisation
and impairment
2,848
1,053
29,853
755
3,808
38,317
Represented by:
•
At cost
9,994
2,090
44,921
755
9,095
66,855
•
Accumulated
amortisation and
impairment
(7,146)
(1,037)
(15,068)
-
(5,287)
(28,538)
Goodwill has been allocated to the following CGU’s:
$’000
2024
2023
Pain Management
3,808
3,808
Respiratory
-
-
3,808
3,808
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67
How MVP accounts for
intangible assets
Goodwill
Goodwill, representing the excess of the
cost of acquisition over the fair value of the
identifiable net assets acquired, is recognised
as an asset and not amortised but tested for
impairment annually and whenever there is an
indication that the goodwill may be impaired.
Any impairment loss is recognised immediately
in the Consolidated Statement of Profit or Loss
and Other Comprehensive Income and is not
subsequently reversed.
Patents, trademarks and
licenses
Patents, trademarks and licenses are recorded
at cost less accumulated amortisation and
impairment. Amortisation is charged on a
straight-line basis over their estimated useful
lives of 10 years. The estimated useful life
and amortisation method is reviewed at the
end of each annual reporting period. The
carrying value of patents, trademarks and
licenses is reviewed at each reporting date for
indicators of impairment. Any impairment loss
is recognised as an expense in the Consolidated
Statement of Profit or Loss and Other
Comprehensive Income.
Registration costs
Registration costs relate to costs incurred
to obtain registration for Penthrox® in a
geographic region.
Registration costs are recognised as an
intangible asset if, and only if, all of the
following are demonstrated:
• the technical feasibility of completing the
intangible asset so that it will be available
for use or sale;
• the intention to complete the intangible
asset and use or sell it;
• the ability to use or sell the intangible asset;
• how the intangible asset will generate
probable future economic benefits;
• the availability of adequate technical,
financial and other resources to complete
the development and to use or sell the
intangible asset; and
• the ability to reliably measure the
expenditure attributable to the asset during
its development.
An assessment is made at each reporting
date as to whether the key recognition criteria
is met. If the recognition criteria is not met,
development expenditure is expensed as
incurred. Expenditure on research activities is
also expensed as incurred.
Methoxyflurane, which is the active ingredient
in Penthrox® , has been used for acute
analgesia in Australia for more than 40
years. The Group has successfully registered
methoxyflurane in over 40 countries, requiring
varying levels of documentation and clinical
evidence to meet the requirements of
regulatory bodies. The Group has historically
capitalised registration costs as an intangible
asset on the basis that it is seeking registration
for a product with an established history of use
in Australia and various International markets,
which supports the Group in meeting the
recognition criteria under AASB 138 Intangible
Assets, in particular the technical feasibility
of achieving registration and the probability of
generating future economic benefits.
The amounts capitalised comprise directly
attributable costs, including:
• The cost of preclinical and clinical trials
(principally external costs)
• Employee benefits directly attributable to
achieving registration within a geographic
region
Registration costs are recorded at cost less
accumulated amortisation and impairment.
Amortisation is charged on a straight-line
basis over the estimated useful life of the
asset (10 years), commencing from the date
that registration is achieved and the Group
commences generating economic benefits from
the relevant geography. Costs capitalised for
registrations in progress are not amortised and
are assessed for impairment annually or when
an indicator of impairment is identified.
Product and technology
development costs
Product and technology development costs
principally include developments costs
associated with the development of new
devices.
Product and technology development costs are
recognised as an intangible asset if, and only if,
they meet the recognition criteria under AASB
138 Intangible Assets, as set out above in the
accounting policy for “registration costs”. If the
recognition criteria is not met, development
costs are expensed as incurred. Expenditure on
research activities is also expensed as incurred.
Product and technology development costs are
recorded at cost less accumulated amortisation
and impairment. Amortisation is charged on a
straight-line basis over the estimated useful
life of the asset (5 - 10 years), commencing
from the date that development activities
are completed and the Group commences
generating economic benefits. Developments
in progress are not amortised.
Brand names
Brand names arising on acquisition of a
business are initially recognised at Fair Value
and subsequently carried at cost less any
applicable impairment charge (if any). They
are not amortised but subject to annual tests for
impairment. For the purposes of impairment
testing, brand names are allocated to the
relevant cash generating unit to which they
relate. Any impairment loss is recognised as an
expense in the Consolidated Statement of Profit
or Loss and Other Comprehensive Income.
Key Estimate and Judgement
Impairment of goodwill and other intangibles
Determining whether goodwill is impaired requires an estimation of the recoverable
amount of the cash-generating units to which goodwill has been allocated. The
recoverable amount calculation requires the entity to estimate the future cash flows
expected to arise from the cash generating unit and a suitable discount rate in order to
calculate the present value of those cash flows.
Key Estimate and Judgement
Impairment of intangible assets not yet available for use
The Group has material capitalised registration costs in relation to obtaining registration
of Penthrox® in a number of jurisdictions (primarily the USA). Management tests these
capitalised costs for impairment annually and where an impairment indicator is identified.
The recoverability of these costs is ultimately contingent upon achieving registration in
these jurisdictions.
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69
Impairment of capitalised
registration costs
During the year the Group completed a review of
the carrying value of assets in accordance with the
Group’s accounting policy and accounting standards.
As a result, the Group recognised an impairment of
capitalised development costs relating to US market
entry, including US market registration costs of $13.9
million and development costs for the next generation
device of $1.9 million. The write-down of US market
entry development costs followed the Company
announcement in April 2024 to pause investment in
US expansion plans. The Group currently does not
meet the criteria under AASB 138 Intangible assets
to maintain the capitalised development costs as
an asset in the Statement of Financial Position. The
Director’s view the impairment charge does not reflect
the inherent value of the work completed to date, and it
may be reversed when development is re-commenced.
Annual impairment testing
Goodwill and intangible assets not yet available for
use are tested for impairment annually and whenever
there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less
costs to sell and value in use. In estimating the
recoverable amount of an asset (or cash-generating
unit), its estimated future cash flows are discounted
to their present value using a post-tax discount rate
that reflects current market assessments of the time
value of money and the risks specific to the asset for
which the estimates of future cash flows have not been
adjusted.
If the recoverable amount of an asset (or cash-
generating unit) is estimated to be less than its
carrying amount, the carrying amount of the asset (or
cash-generating unit) is reduced to its recoverable
amount. An impairment loss is recognised in the
Consolidated Statement of Profit or Loss and Other
Comprehensive Income immediately. An impairment of
goodwill is not subsequently reversed.
Where an impairment loss (other than goodwill)
subsequently reverses, the carrying amount of the
asset (or cash generating unit) is increased to the
revised estimate of its recoverable amount, but only
to the extent 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 in profit
or loss immediately.
The results of the Group’s impairment testing (now
excluding the US region) for the year ended 30 June
2024 are set out as follows:
Pain Management
The recoverable amount for CGUs in the Pain
Management segment was calculated using a ‘value
in use’ approach, which incorporates cash flow
projections over ten years, and a terminal value,
discounted to present value using a risk-adjusted post-
tax discount rate. The Group has modelled cash flow
over a period greater than 5 years given the scale-up
phase the Group is in. This approach enables the Group
to model expected growth before it reaches a level of
maturity in its terminal value. No impairment loss was
identified as a result of impairment testing performed.
The recoverable amount for Pain Management
represents an estimate of future cash flows
attributable to the geographies in which the Group
currently operates, allowing for further growth and
expansion, using the Board approved Budget for year
1, revenue growth in accordance with the business
operating plan for years 2-10 and a terminal growth
rate of 2.0% (2023: 2.0%). The estimate of future cash
flows was then discounted using a post-tax discount
rate of 17.6% (2023: 15.0%).
No future cash flows have been included for the
US region following the decision in April to pause
investment in US market entry.
The cashflows attributable to the geographies in which
the Group currently operates (principally Australia and
Europe) reflect continued growth.
The Group believes that the assumptions adopted
in the recoverable amount calculations reflect an
appropriate balance between the Group’s experience
to date and the Group’s long-term growth expectations
for the Pain Management business.
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71
2.4 COMMITMENTS AND CONTINGENCIES
Capital expenditure commitments
There were no material capital expenditure commitments at the end of the year (2023: nil).
Contingencies
The Group is not party to any legal proceedings that are expected, individually or in the aggregate, to have a
material adverse effect on its business, financial position or operating results.
2.5 LEASES
The lease liabilities included in the consolidated statement of financial position are:
How MVP accounts for provisions and contingencies
Provisions are recognised when the following three criteria are met:
• the Group has a present obligation (legal or constructive) as a result of a past event;
• it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; and
• a reliable estimate can be made of the amount of the obligation
When these criteria cannot be met, a contingency may be recognised.
Provisions are measured at the present value of management’s best estimate of the expenditure required
to settle the present obligation at the reporting date. The discount rate used to determine the present
value reflects current market assessments of the time value of money and the risks specific to the
liability. When discounting is used, the increase in the provision due to the passage of time is recognised
as a financing cost.
When some or all of the economic benefits required to settle a provision are expected to be recovered
from a third party, the receivable is recognised as an asset if it is probable that recovery will be received
and the amount of the receivable can be measured reliably.
How MVP accounts for Leases
The Group recognises a ROU asset and corresponding lease liability with respect to all lease agreements
in which it is the lessee, except for short-term leases and leases of low value assets. Payments
associated with short-term leases and leases of low-value assets are recognised on a straight-line basis
as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less.
Lease liabilities
Lease liabilities are initially measured at the present value of the lease payments that are not paid at
the commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily
determined, the Group uses its incremental borrowing rate.
Each lease payment is allocated between the lease liability and finance costs. The finance cost is
charged to profit or loss over the period of the lease to produce a constant periodic rate of interest on the
remaining balance of the liability for each period. The carrying amount of a lease liability is remeasured if
there is a modification, a change in the lease term, a change in the lease payments (e.g. inflation-linked
payments or market rate rent reviews). A corresponding adjustment is made to the ROU asset.
$’000
2024
2023
Current
371
352
Non-current
1,915
2,208
2,286
2,560
Section 3 – Capital Structure
This section details specifics of the Groups’ capital structure. When managing capital, Management’s objective is
to ensure that the Group continues as a going concern as well as to provide optimal returns to shareholders and
other stakeholders. Management also aims to maintain a capital structure that ensures the lowest cost of capital
available to the Group. Primary responsibility for identification and control of capital and financial risks rests with
the Board of Directors.
3.1 NET CASH
Reconciliation of net loss for the year to net cash flows from operations
The Group had no borrowings as at 30 June 2024 (2023: nil) and was in a net cash position.
$’000
2024
2023
Net loss for the year
(40,992)
(5,609)
Non cash flows in the operating loss:
Depreciation and amortisation
3,394
3,113
Share based payments expense
5,943
964
Impairment expense
16,375
6,709
Contract termination revenue
-
(18,928)
Net unrealised foreign exchange (gain) / loss
320
(246)
Changes in assets and liabilities:
Decrease / (increase) in trade and other receivables
1,861
(2,870)
Increase in inventory
(393)
(1,842)
Decrease / (increase) in net deferred tax assets and liabilities
8,131
(1,883)
(Decrease) / increase in trade and other payables
(5,261)
4,830
(Decrease) / increase in employee benefit provisions
(122)
18
Decrease / (increase) in other assets
226
(172)
Deferred revenue realised
(262)
(579)
Net cash flows used in operating activities
(10,780)
(16,495)
How MVP accounts for cash and cash equivalents
Cash and cash equivalents in the Consolidated Statement of Financial Position comprise cash at
bank and on hand and short-term deposits with a maturity of twelve months or less that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of change in value.
For the purposes of the Consolidated Statement of Cash Flows, cash and cash equivalents consist
of cash and cash equivalents as defined above, net of bank overdraft balances. Bank overdrafts
are included within interest-bearing loans and borrowings in current liabilities on the Consolidated
Statement of Financial Position. Cash flows are included in the Consolidated Statement of Cash Flows
on a gross basis and the GST component of cash flows arising from investing and financing activities
which is recoverable from, or payable to, the taxation authority are classified as operating cash flows.
72
73
3.2 CONTRIBUTED EQUITY AND RESERVES
Terms, conditions and movements of contributed equity
Ordinary shares are classified as equity. Ordinary shares entitle the holder to participate in dividends and the
proceeds on winding up of the Company in proportion to the number of shares held.
Reserves
(1) The foreign currency translation reserve is used to record foreign exchange fluctuations arising from
the translation of the financial statements of foreign subsidiaries (based in the United Kingdom and
Netherlands). Exchange differences arising on the translation from functional currencies to the Group’s
presentation currency (Australian dollars) are recognised directly in other comprehensive income and
accumulated in the foreign currency translation reserve.
(2) The share-based payments reserve relates to performance rights granted by the Company to the CEO and
select senior executives, and the equity settled component of the short term incentive plan for the CEO and
select senior executives.
(3) The CSIRO option reserve relates to 392,308 options (2023: 392,308) over ordinary shares of the Company.
These options are in relation to the MVP/CSIRO Manufacturing Technologies Project announced on 5 June
2017, the final grant of options under this project was completed in the prior year. Options are exercisable
for no consideration when a developed technology has been proven to be commercially viable. The share
options granted to the CSIRO carry no rights to dividends and no voting rights.
$’000
2024
2023
Foreign currency translation reserve(1)
12
(66)
Share-based payments reserve(2)
986
3,940
CSIRO option reserve(3)
1,866
1,866
Total reserves
2,864
5,740
2024
2023
Number of
shares
$’000
Number of
shares
$’000
Movements in contributed equity
Ordinary shares:
Beginning of the year
86,305,175
105,729
71,305,057
76,992
Share placement options exercised
44(1)
-
-
-
Issuance of shares
Share placement
-
-
15,000,118(1)
30,000
Share issuance costs
-
-
-
(1,684)
Tax on share issuance costs
-
-
-
421
End of the year
86,305,219
105,729
86,305,175
105,729
How MVP accounts for contributed equity
Issued and paid up capital is classified as contributed equity and recognised at the fair value of the
consideration received by the entity. Incremental costs directly attributable to the issue of new shares or
options are shown in contributed equity as a deduction, net of tax, from the proceeds.
(1) On 4 August 2022 the Company announced a fully underwritten placement and entitlement offer to raise
$30 million. The placement and entitlement offer was successfully completed in August 2022. Under the
placement, 5,999 options were offered to investors (one free option for every 2.5 shares). On 3 August 2023 a
total of 44 options were exercised and converted to fully paid shares at a price of $2.80.
3.3 CAPITAL MANAGEMENT
The Board of Directors manages the capital of the
Group to ensure that it will be able to continue as
a going concern while maximising the return to
stakeholders. The Group does not enter into trade
financial instruments, including derivatives, for
speculative purposes.
The capital structure of the Group consists of net cash
as detailed in note 3.1 and the equity of the Group
(comprising issued capital, reserves and accumulated
losses).
As at 30 June 2024 the Group had no borrowings, and
was in a net cash position.
3.4 GOING CONCERN
The financial report has been prepared on the going
concern basis, which assumes continuity of normal
business activities and the realisation of assets and
the settlement of liabilities in the ordinary course of
business.
During the current year the Group incurred a net loss
after tax of $41.0 million, used net cash in operating
activities of $10.8 million and used net cash in investing
activities of $3.2 million.
As at 30 June 2024 the Group had $9.7 million of cash
(30 June 2023: $24.7 million), net current assets of
$16.6 million (30 June 2023: $27.2 million), and net
assets of $45.7 million (30 June 2023: $81.3 million).
Subsequent to year-end, the Group announced a fully
underwritten capital raise of $10 million comprising
an institutional placement and non-renounceable
entitlement offer to accelerate growth and improve
balance sheet strength. The institutional component
of the placement was completed on 30 July 2024
with gross proceeds of $6.9m being received. The
entitlement offer closed on 22 August 2024, with gross
proceeds of $3.1 million expected to be received on 27
August 2024.
The Group’s nearer term strategic focus is to increase
the penetration of Penthrox in existing markets, and
to continue to grow its Respiratory segment through
market share gains, particularly in the USA. Longer
term the Group seeks to enter new and attractive
markets for Penthrox.
The Group has prepared a cash flow forecast that
supports the ability of the Group to continue as a going
concern. The Group expects operating cashflows in
FY25 to be improved on FY24, driven by higher pricing
and operational efficiencies of $3-4 million from
initiatives implemented in FY24.
The Directors are satisfied that the Group’s cash
position will enable the Group to pay its debts as
and when they fall due for a period of no less than
12 months from the date the financial report was
approved.
3.5 MANAGING OUR FINANCIAL
RISKS
There are a number of financial risks the Group is
exposed to that could adversely affect the achievement
of future business performance. The Group’s risk
management program seeks to mitigate risks and
reduce volatility in the Group’s financial performance.
Financial risk management is managed by the Audit
and Risk Committee.
The Group’s principal financial risks are:
•
Liquidity risk;
•
Credit risk; and
•
Foreign currency risk.
Managing liquidity risk
Liquidity risk arises from the financial liabilities of the
Group and the Group’s ability to meet its obligations
to repay these financial liabilities as and when they
fall due. The Group has a range of liabilities at balance
date that will be required to be settled at some future
date.
What is the risk?
The risk that MVP cannot meet its obligations to
repay its financial liabilities as and when they fall
due.
How does MVP manage this risk?
• Maintaining adequate cash reserves and
borrowing facilities.
• Continuously monitoring forecast and actual cash
flows and matching the maturity profiles of
financial assets and liabilities.
Impact at 30 June 2024
The FY24 Financial statements have been
prepared on a going concern basis. The Directors
have assessed that the cash reserves at 30 June
2024, in addition to the cash inflows arising from
the completion of the successful share placement
and entitlement offer in August 2024, will provide
the Group sufficient capacity to meet its debts
as and when they fall due for a period of no less
than 12 months from the date these financial
statements were approved (refer note 3.4).
74
75
The Group’s financial instruments comprise cash, trade and other receivables, trade and other payables and
lease liabilities. The Group does not hold any financial instruments that are measured subsequent to initial
recognition at fair value.
The table below summarises the maturity profile of the Group’s financials liabilities based on contractual
undiscounted payments:
The following table represents the changes in financial liabilities arising from financing activities:
Managing credit risk
Credit risk represents the loss that would be recognised if counterparties failed to meet their obligations under a
contract or arrangement. The Group has adopted a policy that customers who wish to trade on credit terms, will
be subject to strict credit verification procedures (refer note 2.1).
The Group’s exposure is continually monitored, with trade receivables consisting of a large number of customers.
The Group evaluates the concentration of risk with respect to trade receivables and contract assets as low as its
customers are located in several jurisdictions and industries and operate in largely independent markets.
$’000
Less than
1 year
1–5 years
More than
5 years
Total
Year ended 30 June 2024
Financial liabilities
Trade and other payables
8,254
-
-
8,254
Lease liabilities
371
1,609
582
2,562
8,625
1,609
582
10,816
Year ended 30 June 2023
Financial liabilities
Trade and other payables
14,186
-
-
14,186
Lease liabilities
359
1,558
1,004
2,921
14,545
1,558
1,004
17,107
$’000
1 July 2023
Cash Flows
30 June 2024
Lease liabilities
2,560
(274)
2,286
Total liabilities from financing activities
2,560
(274)
2,286
$’000
1 July 2022
Cash Flows
30 June 2023
Lease liabilities
2,813
(253)
2,560
Total liabilities from financing activities
2,813
(253)
2,560
76
77
Managing foreign currency risk
The Group’s exposure to the risk of changes in foreign exchange rates relates to the Group’s (i) operating
activities which are denominated in a different currency from the entity’s functional currency and (ii) net
investments in foreign subsidiaries.
The Group currently operates through entities in three countries outside of Australia, with the following
functional currencies:
As the Group has an Australian dollar (AUD) presentation currency, which is also the functional currency of its
Australian entities, this exposes the Group to foreign exchange rate risk.
Country of Domicile
Functional Currency
United Kingdom
GBP
Netherlands
EURO
USA
USD
What is the risk?
How does MVP
manage this risk?
Impact at
30 June 2024
If transactions are denominated
in currencies other than the
functional currency of the
operating entity, there is a risk of
an unfavourable financial Impact
to earnings if there is an adverse
currency movement.
The Group does not currently
consider its exposure to foreign
currency to be significant and
as such forward contracts and
currency swap agreements are
not used. The Group expects to
become increasingly exposed
to the Euro as it’s Penthrox®
European expansion progresses
in coming years and will monitor
the exposure accordingly.
Sensitivity analysis of the foreign
currency net transactional
exposures was performed to
movements in the Australian
dollar against the relevant
foreign currencies, with all
other variables held constant.
This analysis includes only
outstanding foreign currency
denominated monetary items
and adjusts their translation at
the period end for a 10% change
in foreign currency rates.
This analysis showed that a 10%
movement in its major trading
currencies would not materially
impact net loss after tax.
As MVP has entities that do not
have an Australian dollar (AUD)
functional currency, if currency
rates move adversely compared
to the AUD, then the amount of
AUD-equivalent profit would
decrease, and the balance sheet
net investment value would
decline.
The Group does not currently
consider its exposure to foreign
currency to be significant. The
Group expects to expand in
countries outside of Australia in
future years and will monitor its
exposure accordingly.
Sensitivity analysis performed
by management showed that a
10% +/- movement in its major
translational currencies as at
30 June 2024 would not have a
significant impact on equity and
net loss before tax.
How MVP accounts for foreign currency transactions
Transactions in foreign currencies are initially recorded in the functional currency of the individual entity
by applying the exchange rates ruling at the date of the transaction. Monetary assets and liabilities
denominated in foreign currencies are retranslated at the rate of exchange prevailing at reporting date.
Non-monetary items that are measured at:
• Historical cost in a foreign currency are translated using the exchange rate as at the date of the initial
transaction.
• Fair value in a foreign currency are translated using the exchange rates at the date when the fair value
was determined.
As at the reporting date the assets and liabilities of the controlled entities with non-Australian dollar
functional currencies are translated into the presentation currency of MVP at the rate of exchange at the
reporting date and their statements of comprehensive income are translated at the weighted average
exchange rate for the year (where appropriate).
The exchange rate differences arising on the translation to presentation currency are taken directly
to the foreign currency translation reserve, in equity. On disposal of a foreign entity, the deferred
cumulative amount recognised in equity relating to that particular foreign operation is recognised in the
Consolidated Statement of Comprehensive Income.
78
79
were cancelled. Select senior executives also participate in the program, in total they were granted 1,031,743
performance rights during the year. The program has a performance hurdle linked to growth in the share price
over a three year vesting period. Details in relation to performance hurdles and vesting conditions are outlined in
section 3 of the 2024 Remuneration Report.
The rights were independently valued to establish fair value in accordance with AASB 2 Share Based Payments.
The key assumptions used in the independent valuation are outlined in the table below.
Performance rights
The table below shows the movement in performance rights holdings during the year, and the balance of vested
and unvested rights at the end of the financial year.
Ordinary shares under option
The table below shows the movement for ordinary shares under option during the current year.
4.2 SHARE BASED PAYMENTS
Long term incentive plan
During the current period the CEO joined the Group’s long-term incentive (LTI) program and was granted 617,620
performance rights. On acceptance of the invitation to join the LTI program, options previously held by the CEO
Section 4 – Remunerating Our People
This section provides financial insight into employee reward and recognition designed to attract, retain, reward
and motivate high performing individuals so as to achieve the objectives of the Group, in alignment with the
interests of its shareholders.
This section should be read in conjunction with the Remuneration Report, contained within the Directors Report,
which provides specific details on the setting of remuneration for Key Management Personnel.
4.1 EMPLOYEE BENEFITS
The Group’s employee benefits expenses for the year were as follows:
(1) Share based payments expense includes $5.1 million in the current year in relation to the cancellation of
options granted to the CEO on commencement of his employment in FY21. The cancellation of options was
approved at the 2023 AGM as part of the transition to new remuneration arrangements for the CEO. The
expense recognised in the year is the unamortised amount of the fair value of the equity instruments (valued
at the date the instruments were granted) that has not been recognised in the Consolidated Statement of
Profit or Loss and Other Comprehensive Income in prior periods. This is a non-cash adjustment and does not
represent a benefit to the CEO.
The Group’s current employee benefits provisions relate to annual leave entitlements of $639,000 (2023:
$727,000). The non-current employee benefits provisions relate to long service leave entitlements of $309,000
(2023: $343,000).
$’000
2024
2023
Payroll and other employee benefits expense
15,001
14,177
Superannuation contributions
1,306
1,427
Share based payments expense(1)
5,866
964
Contracted employee expense
1,299
5,047
Total employee benefits expense
23,472
21,615
How MVP accounts for employee benefits
Provision is made for employee benefits accumulated as a result of employees rendering services up to
the reporting date. These benefits include wages and salaries, annual leave and long service leave.
Benefits expected to be settled within twelve months of the reporting date are classified as current and
are measured at their nominal amounts based on remuneration rates which are expected to be paid
when the liability is settled.
The liability for long service leave is recognised and measured as the present value of expected future
payments to be made in respect of services provided by employees up to the reporting date using the
projected unit credit method. Under this method consideration is given to expected future wage and
salary levels, experience of employee departures, and periods of service. Expected future payments are
discounted using market yields at the reporting date on national government bonds (except for Australia
where high quality corporate bond rates are used in accordance with the standards) with terms to
maturity and currencies that match, as closely as possible, the estimated future cash outflows.
No options were exercised during the current year (2023: No options exercised). On acceptance of the invitation
to join the LTI program, options previously held by the CEO were cancelled.
How MVP accounts for share based payments
Equity-settled share-based payments granted are measured at fair value at the date of grant.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a
straight-line basis over the vesting period, with a corresponding increase in equity. On the cancellation of
equity instruments, the remaining unamortised amount of the fair value of the equity instruments will be
expensed in the period in which the cancellation occurs.
At the end of the reporting period, the Group revises its estimate of the number of equity instruments
expected to vest and the impact of any revision on the original estimates is also recognised in the profit and
loss.
Balance at
1 July 2023
Number
granted
Balance at
30 June 2024
Vested at
30 June 2024
Unvested at 30
June 2024
CEO
-
617,620
617,620
-
617,620
CFO
84,930
152,285
237,215
-
237,215
Executives
339,828
879,458
1,219,286
-
1,219,286
424,758
1,649,363
2,074,121
-
2,074,121
Option Plans
Balance at
1 July 2023
Number
forfeited
Balance at
30 June 2024
CEO
1,968,704
(1,968,704)
-
Share price at valuation date
$0.85
Volatility
60%
Risk free rate
4.27%
Expected dividend yield
Nil
Fair value per right
$0.44
Model used
Monte Carlo Simulation
80
81
4.3 KEY MANAGEMENT PERSONNEL
Compensation of Key Management Personnel (KMP) of the Group
The amounts disclosed in the table below are the amounts recognised as an expense during the year relating to
KMP:
$’000
2024
2023
Short-term employee benefits
1,483
1,498
Post-employment benefits
100
93
Long-term employee benefits
6
2
Share based payments expense
5,497
1,259
Total compensation
7,086
2,852
Section 5 – Other Disclosures
This section includes additional financial information that is required by the accounting standards and the
Corporations Act 2001.
5.1 BASIS OF PREPARATION
Basis of preparation and compliance
This financial report:
• Comprises the financial statements of Medical Developments International Ltd, being the ultimate parent
entity, and its controlled entities as specified in Note 5.4.
• Is a general purpose financial report.
• Has been prepared in accordance and complies with the requirements of the Corporations Act 2001,
Australian Accounting Standards and other authoritative pronouncements of the Australian Accounting
Standards Board.
• Complies with International Financial Reporting Standards (IFRS) and Interpretations as issued by the
International Accounting Standards Board.
• Has been prepared on a historical cost basis.
• Has revenues, expenses and assets recognised net of GST except where the GST incurred on a purchase
of goods and services is not recoverable from the taxation authority, in which case GST is recognised as
part of the acquisition of the asset or as part of the expense item to which it relates. The net amount of GST
recoverable from or payable to the taxation authority is included as part of receivables or payables in the
Consolidated Statement of Financial Position.
• Is presented in Australian dollars with all values rounded to the nearest $1,000, unless otherwise stated, in
accordance with the ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191
dated 1 April 2016.
• Has all intercompany balances, transactions, income and expenses and profit and losses resulting from intra-
group transactions eliminated in full.
The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using
consistent accounting policies.
The Group will adopt the new and amended standards and interpretations that are issued, but not yet effective,
at the date they become effective. The Groups results and disclosures will not be materially impacted by these
standards.
Comparatives
Where necessary, comparatives have been reclassified and repositioned for consistency with current period
disclosure.
5.2 RELATED PARTY DISCLOSURES
There were no related party transactions during the 2024 financial year (2023: nil). Balances and transactions
between the Company and its subsidiaries which are related parties of the Company have been eliminated on
consolidation and are not disclosed in this note.
Please also refer to note 4.3 for details of Key Management Personnel compensation.
82
83
5.3 PARENT ENTITY FINANCIAL INFORMATION
The above is a summary of the individual financial statements for Medical Developments International Ltd at
balance date. Medical Developments International Ltd:
• is the ultimate parent of the Group;
• is a for-profit company limited by shares;
• is incorporated and domiciled in Australia;
• has its registered office at 4 Caribbean Drive, Scoresby, Victoria, Australia; and
• is listed on the Australian Stock Exchange (ASX) and its shares are publicly traded.
$’000
2024
2023
Current assets
23,068
40,646
Non-current assets
33,019
56,220
Total assets
56,087
96,866
Current liabilities
8,671
13,607
Non-current liabilities
3,861
4,451
Total liabilities
12,532
18,058
Net assets
43,555
78,808
Equity
Issued capital
105,729
105,729
Reserves
2,852
5,806
Accumulated losses
(65,026)
(32,727)
Total equity
43,555
78,808
Loss of the Parent entity
(40,586)
(10,896)
Total comprehensive loss of the Parent entity
(40,586)
(10,896)
How MVP accounted for information within parent entity financial
statements
The financial information for the Company has been prepared on the same basis as the consolidated
financial statements, except as set out below:
• Investments in subsidiaries are accounted for at cost less any impairment in the financial statements of
Medical Developments International Ltd.
5.4 CONTROLLED ENTITIES
The Group’s subsidiaries at 30 June 2024 are as follows:(1)(2)
(1) All entities are wholly owned (2023: wholly owned)
(2) Medical Flow Technologies Pty Ltd was a Non-operating Australian subsidiary that was deregistered during
the year
How MVP accounts for controlled entities
Controlled entities are fully consolidated when the Group obtains control and cease to be consolidated
when control is transferred out of the Group. The Group controls an entity when it:
• is exposed, or has the rights, to variable returns from its involvement with the investee;
• and has the ability to affect those returns through its power over the entity, for example has the ability to
direct the relevant activities of the entity, which could affect the level of profit the entity makes.
United Kingdom
Medical Developments UK Limited
•
Distribution of pharmaceutical drug and respiratory products
Ireland
Medical Developments MD&P Limited
•
Holder of European Penthrox® marketing authorisation
Netherlands
Medical Developments NED B.V.
•
Distribution of pharmaceutical products
United States of America
Medical Developments International USA Inc.
•
Distribution of respiratory products
5.5 AUDITORS REMUNERATION
During the year, the following fees were paid or payable for services provided by Medical Developments
International Ltd’s external auditors Deloitte Touche Tohmatsu:
$
2024
2023
Fees to Deloitte Touche Tohmatsu
Fees for the audit or review of the statutory financial report of the group
235,000
187,500
Fees for taxation compliance services
49,300
38,180
Fees for other services
48,828
-
Total fees to Deloitte Touche Tohmatsu
333,128
225,680
84
85
5.6 SEGMENT ASSETS AND SEGMENT LIABILITIES
Segment assets
Consolidated Entity Disclosure Statement For the year ended 30 June 2024
(1) These reconciling items are managed centrally and not allocated to reportable segments
(1) The Group are currently reviewing the tax residency of Medical Developments NED B.V. to determine if
it meets the criteria of an Australian tax resident. This will include making a submission to the Australian
Taxation Office, so a formal assessment of tax residency can be achieved.
$’000
2024
2023
Pain Management
39,898
58,891
Respiratory
8,262
7,947
Total Segment Assets
48,160
66,838
Reconciliation to total assets(1):
Cash and cash equivalents
9,735
24,661
Deferred tax assets
-
8,112
Other
1,266
1,702
TOTAL ASSETS
59,161
101,313
Segment liabilities
$’000
2024
2023
Pain Management
5,994
11,997
Respiratory
2,260
2,579
Total Segment Liabilities
8,254
14,576
Reconciliation to total liabilities(1):
Employee benefits provisions
948
1,070
Deferred tax liabilities
19
-
Lease liabilities
2,286
2,560
Unearned income
1,920
1,792
TOTAL LIABILITIES
13,427
19,998
5.7 SUBSEQUENT EVENTS
On 26 July 2024 the Group announced a fully underwritten capital raise of $10 million comprising an institutional
placement and non-renounceable entitlement offer to accelerate growth and improve balance sheet strength.
The institutional component of the placement was completed on 30 July 2024 with gross proceeds of $6.9m being
received. The entitlement offer closed on 22 August 2024, with gross proceeds of $3.1 million expected to be
received on 27 August 2024.
Other than included above, there has not been any matter or circumstance that has arisen that has significantly
affected, or may significantly affect the operations of the Group, the results of those operations, or the state of
affairs of the Group in future years.
Entity name(1)
Entity type
Place of
incorporation
Share
capital held
Tax residency
Medical Developments International Limited
Body
Corporate
Australia
N/A
Australia
Medical Developments UK Limited
Body
Corporate
United
Kingdom
100%
United Kingdom
Medical Developments MD&P Limited
Body
Corporate
Ireland
100%
Ireland
Medical Developments NED B.V.
Body
Corporate
Netherlands
100%
Netherlands(1)
Medical Developments International USA Inc.
Body
Corporate
United States
100%
United States
86
87
Number of holders of equity securities
Ordinary share capital
112,658,324 fully paid ordinary shares held by 9,842 individual shareholders.
All issued ordinary shares carry one vote per share.
Distribution of holders of equity securities
Fully paid ordinary shares
as at 28 August 2024
1-1000
5,261
1,001-5,000
2,836
5,001-10,000
782
10,001-100,000
886
100,001 and over
77
9,842
Holding less than a marketable parcel
0
Substantial Shareholders
Number
%
MR DAVID JOHN WILLIAMS
13.087,497
11.62%
Regal Funds Management Pty (and associated entities) (reported at 5 August 2024)
10,617,984
10.16%
Twenty largest holders of equity securities
Number
%
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
10,683,815
9.48
CITICORP NOMINEES PTY LIMITED
7,576,013
6.72
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
6,500,532
5.77
LAWN VIEWS PTY LTD
5,904,120
5.24
MOGGS CREEK PTY LTD
5,278,615
4.69
UBS NOMINEES PTY LTD
4,920,177
4.37
NETWEALTH INVESTMENTS LIMITED
3,650,550
3.24
PAYNE MEDIA PTY LTD
2,937,127
2.61
MIRRABOOKA INVESTMENTS LIMITED
2,592,084
2.30
DR RUSSELL KAY HANCOCK
2,120,000
1.88
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
1,367,424
1.21
BNP PARIBAS NOMINEES PTY LTD
1,364,260
1.21
NAYLOR-STEWART INVESTMENTS PTY LTD
1,045,113
0.93
KIDDER PEABODY PTY LTD
1,042,945
0.93
MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED
867,848
0.77
MR DAVID WILLIAMS
861,817
0.76
NEWECONOMY COM AU NOMINEES PTY LIMITED <900 ACCOUNT>
861,039
0.76
MR ALISTAIR DAVID STRONG
750,000
0.67
NATIONAL NOMINEES LIMITED
748,009
0.66
BNP PARIBAS NOMINEES PTY LTD
733,300
0.65
Additional Stock Exchange Information
Directors’ Declaration
The directors declare that:
a) in the directors’ opinion, there are reasonable grounds to believe that the company will be able to pay its debts
as and when they become due and payable;
b) in the directors’ opinion, the attached financial statements and notes thereto are in accordance with the
Corporations Act 2001, including compliance with accounting standards and giving a true and fair view of the
financial position and performance of the Group;
c) the attached financial statements are in compliance with International Financial Reporting Standards, as
stated in note 5.1 of the financial statements; and
d) the directors have been given the declarations required by s.295A of the Corporations Act 2001.
e) In the directors’ opinion the attached Consolidated Entity Disclosure Statement is true and correct
Signed in accordance with a resolution of the directors made pursuant to s.295(5) of the Corporations Act 2001.
On behalf of the Directors
Gordon Naylor
Company Chair
Dated 26 August 2024
Medical Developments International Limited is a listed public company,
incorporated and domiciled in Australia.
Company Secretary
Ms. Tara Eaton
Registered office and principal
place of business
4 Caribbean Drive
Scoresby, VIC 3179
Tel: (03) 9547 1888
Share registry
Computershare Investor
Services Pty Ltd
452 Johnston Street
Abbotsford, VIC 3067
Tel: 1300 850 505