Uscom Limited
ASX: UCM
2016 Annual
Report
CONTENTS
CHAIRMANS LETTER ................................................................................................................. 2222----5555
CHAIRMANS LETTER
CHAIRMANS LETTER
CHAIRMANS LETTER
IN THE MEDIA ................................................................................................................................6666
IN THE MEDIA
IN THE MEDIA
IN THE MEDIA
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USCOM SUITE OF PRODUCTS ................................
USCOM SUITE OF PRODUCTS
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USCOM SUITE OF PRODUCTS
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FINANCIAL YEAR HIGHLIGHTS ................................
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FINANCIAL YEAR HIGHLIGHTS
FINANCIAL YEAR HIGHLIGHTS
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CORPORATE GOVERNANCE ................................
CORPORATE GOVERNANCE
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CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
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DIRECTORS REPORT ................................
DIRECTORS REPORT
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DIRECTORS REPORT
DIRECTORS REPORT
REPORT
FINANCIAL REPORT
FINANCIAL
REPORT
REPORT
FINANCIAL
FINANCIAL
AUDITORS INDEPENDENCE DECLARATION ........................................................................ 24
INCOME STATEMENT .............................................................................................................. 25
FINANCIAL POSITION STATEMENT ....................................................................................... 26
CHANGES IN EQUITY ............................................................................................................... 27
CASH FLOWS STATEMENT ...................................................................................................... 28
NOTES TO FINANCIAL STATEMENTS .............................................................................. 29-52
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DIRECTORS DECLARATION ................................
DIRECTORS DECLARATION
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DIRECTORS DECLARATION
DIRECTORS DECLARATION
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INDEPENDENT AUDIT REPORT ................................
INDEPENDENT AUDIT REPORT
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INDEPENDENT AUDIT REPORT
INDEPENDENT AUDIT REPORT
SHAREHOLDER INFORMATION
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SHAREHOLDER INFORMATION ................................
SHAREHOLDER INFORMATION
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SHAREHOLDER INFORMATION
CHAIRMAN’S LETTER
“Uscom has acquired global assets
to ensure reliable revenue growth
for investors for the coming
decade.”
For Uscom shareholders, 2016 was a year of record sales, revenues and cash receipts. It was a year in which the Uscom
Board and Management continued to execute our growth strategy and achieved milestones beyond our targets.
FY 2016 was a year in which Australian Reserve Bank interest rates fell below 2%, and superannuation funds returned in
the order of 5%, and the Uscom share price increased by 61% and the capitalised value of UCM increased by 114%.
While delivering the fourth consecutive year of significant growth, the most important results for FY 2016 are the results
of our continued investment in the future. Our strategic acquisitions, implementation of a global corporate model,
preparation of the Budapest volume manufacturing facility, and development of two new product lines, combined with
signing the transformational $65m Importation and Wholesale agreement with CIIC Shanghai Science and Technology
Group, has prepared Uscom for sustained growth in FY 2017 and beyond. Importantly much of the spend associated
with these investments has already been met and is reported in our current accounts, and it is the revenues from these
investments that is planned to drive our on going commercial strategy and reliably underwrite growth and shareholder
dividends over the coming decade.
Uscom has established a culture of developing an aggressive growth strategy, keeping investors engaged, and executing
on our strategy to benefit our shareholders. This is planned to continue as we rapidly grow toward profitability in 2017.
2016 Results:
••••
Record sales, total revenues and cash receipts (4 years of consecutive growth).
••••
Total revenue up 44% to $2.94m (3 year CAGR – 43% pa).
•••• Cash receipts up 94% to $2.56m (3 year CAGR – 60% pa).
•••• Cash on hand $2.84m, up from $0.53m.
Total Revenue
$2,936,504
$2,039,426
$1,377,716
$1,010,942
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$864,099
$500,000
$0
2012
2013
2014
2015
2016
Share price in 2016 up 61% (15.5c to 25c), and capitalised value up 114% ($12.2m to $27.1m).
Thor Laboratories acquired, with accounts and reporting consolidated into Uscom Limited.
•••• Net cash outflow $1.29m, up from $0.99m.
••••
••••
•••• CIIC Shanghai Science and Technology to import and wholesale Uscom devices, targeting A$65m over 5 years.
•••• New BP+ and SpiroSonic devices prepared for market and revenue in 2017.
•••• New Uscom offices in London and Shanghai.
•••• Continuing growth in sales of flagship USCOM 1A’s.
Page | 2
Results:
This year was the fourth consecutive year of growth in
Uscom operations, with total revenue growing at a
compound annual growth rate (CAGR) of 43% for each of
the last consecutive three years, while cash receipts grew
by a CAGR of 60% each year for the same period.
Total revenue for FY2016 grew by 44% to $2.94m, while
cash from customer sales increased 94% to $2.56m. Total
revenue from Uscom Budapest since acquisition (10
months) was $0.53m. The net cash outflow from operating
activities for the year was $1.29m, up from $0.99m, and
the operating loss before income tax increased to
$1.92m, up from $1.22m in 2015, contributed by Uscom
Budapest.
Non-recurring costs significantly contributed to the
increased cash outflows during the period and included
the acquisition of Thor Laboratories
($0.59m), the
consolidation of Thor Laboratories into Uscom Limited,
and the preparation of the BP+ and SpiroSonic ranges of
products for global markets (approx $0.5m). Additional
non-recurring costs associated with the acquisition
included enhanced management, and the establishment
of
international corporate auditing and compliance
monitoring for Uscom Budapest. Other non-recurring
expenses during 2016 included the establishment of a
regional office in London.
Capital:
Cash on hand at the end of the period was $2.84m, up
from $0.53m in 2015, following an oversubscribed private
placement, which raised $2.3m. A further $1.2m in
unexercised options priced at 0.25c remains outstanding.
Total shareholder equity increased 117% to $4.94m from
$2.29m.
Share price:
UCM Growth 2016
114
61
125%
100%
75%
50%
25%
0%
Share Price
Cap Value
While investors continue to pay a premium for growth, the
Uscom share price grew 61% (15.5-25c) in FY 2016, and
the capitalised value of the company increased 114%
($12.2m-$27.1m).
CHAIRMAN’S LETTER
continued
Products:
1.1.1.1. The USCOM 1A –––– the ultrasonic cardiac
output monitor.
2.2.2.2. The Uscom BP+
suprasystolic
oscillometric central blood pressure
monitor.
––––
3.3.3.3. The Uscom SpiroSonic series of devices –
ultrasonic
fidelity multi-path
high
spirometers.
The flagship USCOM 1A continues to be recognised as
an emerging gold
cardiovascular
measurement and monitoring as it continues to replace
invasive but
less accurate technologies. With this
recognition comes continued growth in global sales.
standard
for
The new BP+ series of products based on suprasystolic
oscillometry will revolutionise the measurement and
management of hypertension, heart failure and maternal
health (pre-eclampsia), and contribute to the science of
vascular health and ageing. The devices are in the final
stages of preparation for market and will be sold into
critical care, clinical care and home care applications.
The SpiroSonic series of digital ultrasonic spirometers
provide research quality pulmonary testing devices at
clinical prices and address the massive and growing
markets of asthma, Chronic Obstructive Pulmonary
Disease (COPD) and occupational lung disease. The
rebranded devices are in the final stages of preparation
for market and will be sold in critical care, clinical and
home care applications, as well as emerging markets in
sleep medicine.
Sales and Distribution:
Distribution drives revenue, and we have invested into
our global distributors to ensure they are aligned with our
culture and aware of the distinguishing features of our
devices. We continue to seek out the highest quality sales
partners worldwide to consolidate our global distribution
network. Having three separate suites of products is
proving attractive for higher quality distributors seeking a
range of practice leading and novel technologies. While
some of our established distributors have applied to sell
the new BP+ and SpiroSonic devices, we are also
attracting interest from global groups seeking products
with competitive advantages.
Uscom continues to take greater control of its sales and
distribution processes, and has increased its distribution
agreements to 43. Not only do we have more distributors,
but these distributors have increased scale and reach
which will result in improved access to markets. This
distribution will be particularly useful once the new BP+
and SpiroSonic devices are ready for sale and can be
rapidly fed into existing channels.
Our distributors are also being monitored more
effectively and new marketing materials are being
Page | 3
developed rapidly to assist the growing distribution
network. Hanna Maartensson has joined the company in
the last year and brings more than 15 years of medical
device sales and marketing experience. She is actively
preparing support materials for the new devices.
Uscom Budapest:
Uscom acquired Thor Laboratories in Budapest over
2016, an acquisition with significant clinical, strategic, and
operational synergies for Uscom.
This productive acquisition
required considerable
strategic planning, legal oversight, accounting discipline
and managerial focus. However, the result is a revenue-
generating entity, with world-leading technology and a
digital spirometric product series with global regulatory
approvals, as well as staff with device specific experience.
capability and
significant R&D
Thor also has
internationally accredited manufacturing, and will deliver
cost-effective volume manufacturing to support our new
product releases in 2017. The Budapest team is central to
the preparation and management of the regulatory
materials and processes for the new BP+ and rebranded
SpiroSonic series of devices as we prepare for global
release.
Since the acquisition, we have established corporate
accounting and financial reporting in Hungary and
consolidated the entities, and are anticipating the
operations to rapidly convert to profitability.
Mr George Ferenczi, a world-leading bio-engineer
specialising
in pulmonary devices, has become an
integral part of our global business and is in charge of the
Budapest operations and pulmonary device strategy
worldwide.
Science:
Uscom devices address diseases that are responsible for
approximately 80% of global mortality from preventable
disease, including sepsis, heart failure, hypertension,
stroke, asthma and COPD according to World Health
Organisation figures. Our precision non-invasive devices
improve the clinical decision making process
for
physicians and improve the management of patients, and
leading
are
clinicians.
increasingly being preferred by world
There were 36 new publications supporting the utility of
the 1A and the BP+ in FY 2016, covering the fields of
hypertension, heart failure, sepsis in adults, children and
neonates, and pre-eclampsia.
The USCOM 1A continues to set standards of care for
the
paediatric sepsis. This year a study
Chulalongkorn University Department of Paediatrics and
the King Chulalongkorn Memorial Hospital (KCMH) in
Thailand demonstrated a reduction in mortality of 46%
associated with use of USCOM 1A in paediatric patients
suffering fluid refractory septic shock.
from
CHAIRMAN’S LETTER
continued
Importantly this year, ahead of the global release of the
Uscom BP+, a study from the Great Ormond Hospital for
Children compared BP+ measures beside cardiac
catheter measurements of central BP in infants and
children aged 1 to 19 years of age and found effective
interchangeability. This confirms the strength of the BP+
science and its potential to replace invasive catheters by
delivering a reliable “non-invasive art line” to clinicians
for treating adults, children and infants.
In the US, central BP is now covered by a CPT Code, and
is eligible for general reimbursement. The Uscom BP+ is
being prepared to take advantage of this code and will
be highly competitively priced, being marketed at a
fraction of the cost of most of our competitors while
delivering world leading technology.
Uscom is a company founded on scientific excellence and
practice leading products, and this year confirms the
growing success of this founding mission, a mission that
will continue to support the global growth in sales.
Patents:
Uscom has a portfolio of more than 40 patents and patent
applications covering various products and technologies,
and in 2016 was granted two new key US patents relating
to the BP+ technology. One of these was for the methods
and algorithms used to measure the central blood
pressure, and the other for the device to measure the
central BP. This is further recognition of the strength and
novelty of the Uscom BP+ suprasystolic oscillometric
method for measuring central BP and protects our
commercial opportunities going forward.
Strategy 2017:
Uscom’s objective is to continue to execute on our
strategy to maintain rapid financial growth based on
world-leading cardiovascular and pulmonary monitoring
technologies and to establish enduring profitability for
investors.
Over the past four years, our strategy has been conceived
and partially completed, with the acquisition and
integration of Pulsecor and Thor, and the re-development
of the two new Uscom product suites for market in 2017.
This preparation has
involved product optimisation
including both hardware and software and in some
products re-branding, resulting in additional regulatory
approvals. In this time, we have also established strategic
global operations with offices in Los Angeles, London,
Budapest, Shanghai and Sydney.
We are proud to have acquired and developed two new
series of cardiovascular and pulmonary products that are
practice changing and that fit clinically into the vision we
have to improve global health care. The short term
objective for 2017 remains to deliver the new and
improved Uscom BP+ and the rebranded SpiroSonic
products to market. This is planned to drive future growth
beyond USCOM 1A sales alone, and ensure our
approaching sustainable profitability.
Page | 4
2017 revenue growth will be driven by:
1.1.1.1. Increasing sales to China through CIIC
2.2.2.2. Early BP+ and SpiroSonic sales
3.3.3.3. Continuing increased USCOM 1A sales
4.4.4.4. Improvements to our distribution and
marketing network
To achieve this, we will continue our focus on CIIC and
ensure they have all the marketing and sales resources
and product required to supply the Chinese market and
achieve our $65m revenue targets over the next 5 years.
We are also expanding our efforts in the UK and Europe,
and 2017 will see BP+ and SpiroSonic entering this market
with an associated revenue growth.
Uscom will also target BP+ and SprioSonic sales in the US
in 2017. Both devices have reimbursement in the US, an
essential requirement for sales in this market, and their
release is ideally timed to coincide with an increasing
incidence and social awareness of hypertension and
asthma/COPD monitoring, and expanding eHealth
opportunities.
CHAIRMAN’S LETTER
continued
Conclusion:
Uscom is now a diversified, technologically de-risked
medical device company with strong revenue growth,
rapidly approaching profitability, and excellent short, mid
and long-term revenue opportunities.
The aggressive expansionary strategy of the Uscom
Board and Management is driving current growth as the
excellent 2016 financials demonstrate. However, the
more important result for investors has been the strategic
positioning of the company for accelerating future growth
as we deliver our new product ranges to market.
The investment in the acquisition and integration of two
independent medical device companies, and
the
founding of a new global corporate model is designed to
operate as the backbone of our international business
and the pathway to ongoing profitability. The expenses
for the acquisition and remodelling and re-branding of
the BP+ and the SpiroSonic series for global marketing
and sales in 2017 has been met, funded by investor equity
and operational cash flow. Further, much of our reported
spend is non-recurring, and as our new devices are
released to market, the generated revenue should rapidly
convert to profitability off a stable cost base.
A rapidly growing opportunity for Uscom devices is the
eHealth and home care market. While many organisations
have developed software platforms to receive and
interpret electronic measurements of physiology, there
are very few high quality, front end sensors with digital
capabilities available to couple with these software
products.
Uscom is building a strong business based on sound
fundamentals off the back of blue-sky science, with the
objective of reliably returning profit to investors in line
with prudent management. The quest to improve clinical
science and create socially valuable cardiovascular and
pulmonary devices to profitably improve global health is
our business, and Uscom investors are our partners.
Uscom has the most cost-effective options for non-
invasive, digital and accurate monitoring of the heart,
vessels and lungs. Uscom’s place in this sector is
anticipated to become more definitive during 2017 as this
dynamic market keeps evolving.
Accompanying
the
complimentary expansion of the Uscom Budapest
operations to meet growing volume manufacturing
demand.
revenue growth will be
this
Together we can review 2016 with satisfaction and look
forward to the opportunities of 2017 and beyond.
An investment in Uscom is an investment in the future.
While costs are expected to remain high for the coming
period as we finalise global regulatory and marketing for
our new product series, this should be offset by increasing
revenue in the second half of the financial year.
For 2017, our strategy is to deliver the
devices we have acquired into global
markets. The components for execution
are in place, and we have confidence that
this will drive our growth foreseeably.
Associate Professor Rob Phillips
PhD(med), MPhil(med), FASE, DMU(cardiol)
Executive Chairman
Uscom Limited
Page | 5
Uscom Product Suite
Devices the experts use
USCOM 1A
The Fluid Solution.
Doppler Flow
Hemodynamics measured
Non-invasively at
the Aortic or Pulmonary
Valve
SpiroSonic Suite
Addressing the Challenges
of Asthma, COPD and
Occupational Lung Disease
Uscom BP+
Non-invasive Central and
Brachial Blood Pressure in
less than 60 seconds
HIGHLIGHTS OF THE YEAR
August
September
October
.
November
December
January
.
February
March
April
.
May
June
July
•
•
•
•
•
•
•
•
•
•
•
•
•
Uscom completes its acquisition of 100% of Thor Laboratories following successful
diligence and capital raising.
Uscom establishes UK subsidiary in London, Uscom Medical Ltd.
Los Angeles Children’s Hospital, and the Keck School of Medicine, University of Southern
California, validates the non-invasive USCOM 1A as a replacement technology for the
invasive pulmonary artery catheter (PAC) in children.
Great Ormond Street Hospital for Children (GOSH) publishes an independent study
demonstrating equivalence of catheter based measures of central blood pressure (Cbp)
with non-invasive Uscom BP+ Cbp measurements.
Uscom awarded a two year contract for supply of Uscom BP+ central blood pressure
devices into the UK NHS Supply Chain.
Mr Chao Xian (David) He, former J&J Asia executive, appointed as a Director of Uscom
Limited.
Chulalongkorn University Department of Paediatrics and the King Chulalongkorn
Memorial Hospital (KCMH) publish results demonstrating a reduction in mortality of 46%
in paediatric fluid refractory septic shock patients using USCOM 1A.
Uscom is featured in The Australian Business Review in an article titled “Uscom on the
cusp of a billion dollar transformation” by Sarah-Jane Tasker.
Study from 524 US Hospitals, examining records of 655,426 patients, demonstrates the
opportunity for use of the USCOM 1A to reduce medical complications and cost of care
associated with routine surgery.
Mr Brett Crowley, a practicing solicitor and a former Partner of Ernst & Young in Hong
Kong and Australia, and of KPMG in Hong Kong appointed as Company Secretary.
Uscom raises in excess of $2.2m from the sale of 11,072,125 FPO UCM shares at a price
of $0.20.
Uscom executes an agreement with China International Intellectech Corporation (CIIC)
which is targeted to generate USD$48.2m (≈A$65m) in sales from China over the next
five years.
Uscom receives a Notice of Allowance for the patent covering the central algorithms in
the Uscom BP+ suprasystolic oscillometric central blood pressure monitor.
Page | 8
GLOBAL IMPACT
““““Uscom has acquired
global assets to ensure
Reliable revenue growth
for investors for the coming
decade.””””
TOP 10 Preventable Causes of Global Mortality
Hypertensive
4%
Diarrhoeal
Diseases
5%
Heart Disease
26%
Uscom devices
address conditions
associated with
80% of the top 10
preventable causes
of global mortality
Lower
Respitory
Infection
11%
COPD
11%
Stroke
23%
22.9m of 28.8m (80%)
(World Health Organisation 2012
criteria)
Page | 9
CORPORATE GOVERNANCE STATEMENT
This statement outlines the Corporate Governance
framework and practices adopted by the Board of
Directors of Uscom Limited (the Board
the Board) and in place for
the Board
the Board
the financial year ended 30 June 2016, by reference to the
ASX Corporate Governance Council’s Corporate
(3rd
Governance Principles and Recommendations
Edition) (the Recommendations
the Recommendations). The Statement was
the Recommendations
the Recommendations
approved by the Board on the 16th of August 2016.
The Board and Senior Management of Uscom are
committed to acting responsibly, ethically and with high
standards of integrity as the Company strives to create
shareholder value. Uscom is committed to implementing
standards of corporate governance
the highest
appropriate for a company of its size and operations.
The Board considers and applies the Recommendations
taking into account the circumstances of the Company.
from a
the Company’s practices depart
Where
Recommendation, this Statement identifies the area of
divergence and reasons for it, or any alternative practices
adopted by the Company.
The Board has established a number of corporate
the
governance
documents
Recommendations which
the
Company’s corporate governance framework – these
documents are referenced in this Corporate Governance
Statement where relevant, and are as follows:
the basis of
consistent
form
with
•
•
•
•
Uscom Board Charter (updated and adopted 27
May 2015);
Uscom Continuous Disclosure & Shareholder
Communications Policy (updated and adopted 27
May 2015);
Uscom Code of Conduct (updated and adopted
27 May 2015); and
Uscom Securities Trading Policy (updated and
adopted 27 May 2015).
The corporate governance documents are available on
the Uscom website under “Investor” then “Corporate
Governance.”
http://uscom.com.au/investor/corp_governance.html
.
Principle 1:
Lay solid foundations for management and
oversight
The Board has primary responsibility for guiding and
monitoring the business and affairs of Uscom, including
compliance with the Company’s corporate governance
framework, and in conjunction with senior management,
setting the strategic direction of the Company.
in accordance with
It is the role of Senior Management to manage the
the direction and
Company
delegation of the Board and the responsibility of the
Board to provide leadership to, and oversee the activities
of Management in carrying out these delegated duties.
The Board Charter sets out the roles and responsibilities
of the Board, including those matters specifically reserved
to the Board. The Charter also sets out the role and
responsibility of the Chief Executive Officer, which is
primarily the day to day management of the Company,
supported by the senior management team.
The Board Charter provides that prior to the appointment
of a new Director, and before a candidate is put forward
as a candidate for election as a Director, appropriate
checks will be undertaken including checks regarding the
person’s experience, education, disqualification from
holding certain offices, criminal record and bankruptcy
history. At any AGM the Company provides shareholders
with all material information in its possession relevant to
a decision on whether or not to elect or re-elect a director.
Non-executive Directors are provided with a formal letter
of appointment which sets out the key terms, conditions,
responsibilities and expectations of their appointment.
Senior Management are employed under individual
service contracts which set out their terms of employment
including details of their duties, responsibilities, rights
and remuneration entitlements.
The Board Charter provides that Directors may seek
independent professional advice at the expense of the
Company, when considered necessary to discharge their
Page | 10
CORPORATE GOVERNANCE STATEMENT
continued
responsibilities to the Company. Any such advice is the
property of the Company and may be provided to the
other Directors.
The Board Charter provides that the Company Secretary
is accountable to the Board through the Chairman for all
matters concerning the proper functioning of the Board,
including advising on governance matters, monitoring
that the Board’s policies and procedures are followed and
ensuring that the business at Board meetings is accurately
captured in the minutes. As a matter of practice, where
the Board is considering any matters relating to the
Executive Chairman in his capacity as Chief Executive
Officer,
is
the Company Secretary
accountable to the Non-Executive Directors.
reports and
The Board does not have a formal Diversity Policy in place
and has not established measurable objectives for
achieving measurable objectives for achieving gender
diversity at this time. Given the small size of the Company
workforce and the stage of the Company’s development,
the Board considers that it is not currently necessary or
practical
to establish a Diversity Policy or have
measurable objectives aimed at achieving gender
diversity. The Company seeks to promote and support
an appropriate mix of diversity on its Board, in senior
management and the organisation more generally. The
Board will continue to review this matter, including
whether it may be appropriate to establish a formal
framework in this regard as the Company meets its
strategy and grows.
The proportion of women employees in the whole
organisation, women in senior management positions
and women on the Board are set out in the following
table:
Proportion of Women
Proportion of Women
Proportion of Women
Proportion of Women
Whole Organisation
Whole Organisation
Whole Organisation
Whole Organisation
8 of 20 (40%)
Senior Management
Senior Management
Senior Management
Senior Management
Positions
Positions
Positions
Positions
0 of 2 (0%)
Board
Board
Board
Board
1 of 4 (25%)
RRRRecommendation 1.5(c)(1)
ecommendation 1.5(c)(1)
ecommendation 1.5(c)(1)
ecommendation 1.5(c)(1)
The Board has not established a formal process for
evaluating its performance and that of individual directors
to date. Given the small size of the Board, to date the
Directors have considered that they have been able to
assess and monitor each other’s performance on an
ongoing basis, and raise any concerns as they arise. The
Board Charter provides that the Board is responsible for
undertaking a formal evaluation process to review its
performance once a year, therefore the Board will review
this matter with a view to establishing a formal evaluation
process in the next reporting period.
There is currently no formal evaluation process in place
by which the Board assesses the performance of senior
management against specific measurable performance
criteria. The Board considers that given the size of the
Company and the stage of its development, it is most
appropriate to assess senior management’s performance
on a continuous informal basis.
Principle 2:
Structure the Board to add value
The current Board has 3 Directors comprising the
Executive Chairman and Chief Executive Officer Rob
Phillips, and two independent Non-Executive Directors,
Christian Bernecker and Sheena Jack. The Board Charter
provides that an independent director is determined by
reference to the factors set out in Box 2.3 of the
Recommendations.
Further details about the Directors, including their tenure,
skills, experience and expertise relevant to the position of
director, and their non-executive and independent status,
are set out in the Directors’ Report on pages 15 to 22 of
the Annual Report.
The Executive Chairman Rob Phillips is not independent.
The Board considers it is appropriate that Dr Phillips
undertakes this role, given his specific qualifications,
knowledge and experience, and deep understanding of
the Company, its products and operations. The Board
has also taken into account the size of the Company and
the Board, and the stage of development of the
Company’s business and strategy.
Page | 11
CORPORATE GOVERNANCE STATEMENT
continued
The Board is committed to ensuring that the Company
maintains the highest standards of integrity, honesty and
fairness in its dealings with all stakeholders, and that the
Company complies with all legal and other obligations.
the
The Company has established a Code of Conduct (the
the
the
CodeCodeCodeCode) which applies to all directors, senior management
and staff (Employees
Employees). The Code promotes practices
Employees
Employees
that aim to foster the Company’s key values, which
include providing a safe and healthy work environment,
encouraging Employees to act with fairness, honesty and
integrity, being aware of and abiding by relevant laws and
regulations and maintaining high
standards of
professional behaviour. Employees are expected to be
honest and ethical in their dealings with each other and
all stakeholders.
The Company’s Securities Trading Policy applies to all
Directors, officers and employees of Uscom. The Policy
sets out the prohibitions against insider trading, and
prescribes certain requirements for dealing in Uscom
securities. All Company personnel are prohibited from
trading in Uscom securities while in possession of material
non-public information, which is information a reasonable
person would expect to have a material effect on the
price or value of Uscom securities. The Policy provides
for certain black-out periods when no trading may occur.
The Board Charter sets out the distinct responsibilities of
the role of the Executive Chairman and the Non-
Executive Directors, and provides that an Independent
Director will be appointed to fulfil the role of Chairman
whenever the Executive Chairman is conflicted.
Dr Phillips is also the Chief Executive Officer of the
Company, and therefore the role of the Chairman and
Chief Executive Officer are undertaken by the same
person. The Board believes this is appropriate, for the
reasons given above in relation to Dr Phillips’ role as
Executive Chairman.
The Board has not established a Nominations Committee
at this time, given the current size and composition of the
Board and Company, and taking into account that it is not
likely that the size of the Board will increase in the short
to medium-term. The Board carries out the functions that
would ordinarily be carried out by a Nomination
Committee.
The Board considers that there is currently an appropriate
mix of skills, diversity and experience on the Board, taking
into account the size of the company, the stage of its
development and the nature of its operations. The
Company seeks to maintain a Board of Directors with a
broad range of relevant financial, industry and other
relevant skills, experience and knowledge. The Board has
not developed a skills matrix at this time. The Board
considered the attributes of its current Directors at the
time of their appointment, including the specific skills,
experience, expertise and diversity they brought to the
Board, in light of the Company’s stage of development,
its operations and strategy. To date the Board has
considered that given its small size, it is able to identify
any possible gaps in Board skills. However, the Board
believes that a skills matrix would provide a sound basis
for both Board evaluation purposes and to assist in
identifying what may be required of future Board
candidates, in the event it determines to appoint a new
Director. The Board intends to establish a skills matrix in
the next reporting period. The Board will also consider
establishing plans to manage the succession of senior
management in the next reporting period.
Principle 4:
Safeguard integrity in corporate reporting
the
stage of
The Board does not have an Audit Committee, having
dissolved its Audit Committee in February 2014. The
Board considers that taking into account the size of the
Company and the Board, the nature of the Company’s
operations and
the Company’s
development, it is not necessary to have a separate Audit
Committee. The functions that would ordinarily be
undertaken by an Audit Committee, including issues
relating to the Company’s financial information and
review of the Company’s risk controls and processes, are
primarily carried out by the two Non-Executive Directors.
Non-Executive Director Sheena Jack is an experienced
financial professional who has held senior positions in that
capacity.
The Board Charter provides that each new Director will
be required to participate in an induction program to
familiarise themselves with the Company, its strategy and
operations, and policies and procedures. Directors may
undertake and request training as appropriate for their
role, with the permission of the Chairman. The Charter
also provides that in carrying out their duties and
responsibilities, Directors may
independent
professional advice at the Company’s expense, after
consultation with the Chairman.
seek
Principle 3:
Promote ethical and responsible decision
making
The Board has not currently established a formal
procedure for the selection, appointment and rotation of
the external auditor. The performance of the external
auditor is reviewed on an ongoing basis by the Board.
Prior to approval of the Company’s half year and annual
financial reports, the Executive Chairman and General
Manager are required to provide the Board with written
assurances in relation to the half year and annual financial
reports that the declaration provided in accordance with
section 295A of the Corporations Act 2001(Cth) is
founded on a sound system of risk management and
internal compliance and control and that the system is
operating effectively in all material respects in relation to
financial reporting risks. These assurances were provided
in the reporting period.
Page | 12
CORPORATE GOVERNANCE STATEMENT
continued
The external auditor attends the Company’s Annual
General Meeting and is available to answer shareholder
questions about the conduct of the audit and preparation
and conduct of the Independent Auditor’s Report.
Shareholders are also given the opportunity to submit
written questions prior to the meeting. The Company
considers that this
in promoting and
encouraging shareholder participation and reflects and
supports the roles of the auditor and the auditor’s
accountability to shareholders.
important
is
Principle 6:
Respect the rights of shareholders
Uscom’s Continuous Disclosure and Shareholder
Communications Policy sets out its policy and practices in
relation
to providing
shareholders with the necessary information and facilities
to allow them to exercise their rights effectively,
including:
to Uscom’s
commitment
Principle 5:
Make timely and balanced disclosure
The Company’s Continuous Disclosure Policy and
External Communications Policy sets out the policies and
procedures relating to:
•
•
•
providing shareholders with ready access to
information about Uscom and its governance;
communicating openly and honestly with
shareholders; and
encouraging
participation in shareholder meetings.
shareholder
facilitating
and
•
•
•
Uscom’s continuous disclosure obligations
under the ASX Listing Rules and Corporations
Act 2001 (Cth);
How Uscom staff are required to deal with
potentially price-sensitive
information, and
communications with external stakeholders such
as
the
the media, security holders and
community to ensure that the Company meets
its continuous disclosure obligations; and
The Company’s shareholder communications
policy generally.
The Company’s website www.uscom.com.au provides
detailed information about its business and operations.
The Investor section of the website provides helpful
information to shareholders and a link to Uscom’s Share
Registrar, Boardroom. The Investor section also provides
a link to the ASX share price and Annual and periodic
Reports.
Shareholders can find information about the Company’s
corporate governance practices in the Uscom Corporate
Governance section under “Investors”. This includes the
Company’s Constitution, Board and Charter and the
Company’s corporate governance policies.
It is Uscom’s policy to ensure that all market participants
have an equal opportunity to review and access material
information made available by the Company, and that the
Company complies with both the letter and spirit of its
continuous disclosure obligations under the ASX Listing
Rules and the Corporations Act.
facilitates compliance with
The Continuous Disclosure and External Communications
the Company’s
Policy
continuous disclosure obligations by setting out
procedures that must be followed if staff become aware
of material information, and the obligations of senior
management and the Board to continuously assess and
consider continuous disclosure matters. The Policy
specifies those persons authorised to speak to ASX or
other external parties in relation to the Company, and
those disclosure matters that fall within the reserved
powers of the Board. Other matters dealt with in the
Policy include:
•
•
•
•
•
dealing with market speculation and rumours;
trading halts;
management of information during periods
where the Company may be in possession of
price-sensitive information;
analyst briefings; and
monitoring of media and social media.
and
from,
communications
The Company provides shareholders with the option of
receiving
sending
communications to, the Company and Share Registry
electronically, for reasons of cost, convenience and
environmental considerations. The Company provides a
printed copy of the Annual Report only to those
shareholders who have specifically elected to receive a
printed copy. Other shareholders are advised that the
Annual Report is available on the Company’s website.
Shareholders are encouraged to register on the Company
website to receive email alerts of ASX Announcements
and Media Releases and other news.
is managed and
The Company’s Share Register
maintained by Boardroom Limited. Shareholders can
access their shareholding details or make enquiries about
their shareholding electronically
link
provided on the Uscom website in the Investor section, or
through the Boardroom InvestorServe facility or by
emailing enquiries@boardroomlimited.com.au.
through
the
to
facilitate effective
The Company has not implemented a formal investor
relations program
two-way
communication with investors. The Board will consider
establishing such a program when it believes it is
appropriate, taking into account the Company’s stage of
development, and the resources available to the
Company.
Page | 13
CORPORATE GOVERNANCE STATEMENT
continued
The Company’s remuneration structure distinguishes
between non-executive Directors and that of the
Executive Chairman and Senior Management. The
Remuneration Report required under section 300A of the
Corporations Act 2001 (Cth) is provided in the Directors’
Report on pages 17-22.
The Company’s Securities Trading Policy specifically
prohibits Directors and senior management
from
entering into transactions which would limit the economic
risk of any unvested entitlements under any equity-based
remuneration schemes.
Further, Directors and senior management are prohibited
from entering into margin loan arrangements or other
arrangements whereby their securities in the Company
may be used as collateral, without prior approval.
Breaches of
regarded as serious
misconduct.
this policy are
Principle 7:
Recognise and manage risk
The Board is responsible for oversight of risk, including
monitoring and review of risk management matters
delegated to senior management. To date, the Board
has not established a formal risk management framework
and does not conduct formal periodic reviews of the
effectiveness of specific risk controls. The Board assesses
the Company’s material business risks and controls,
including accounting, financial and operating controls, on
an informal and ongoing basis. The Board intends to
establish a formal risk management framework and
processes for monitoring the effectiveness of that
framework in the next reporting period.
The Company does not retain an Internal Audit function.
The Board considers this is appropriate, taking into
account the Company’s stage of development, the scale
of its operations and the relative simplicity of its finance
function. The Board intends to review the processes it
employs to evaluate risk management processes and
its overall
internal control processes as part of
consideration of its risk management framework in the
next reporting period.
The Board does not consider that the Company has any
material exposure to economic, environmental and social
sustainability risks.
Principle 8:
Remunerate fairly and responsibly
The Board has not established a Remuneration
Committee.
The Board is responsible for:
•
•
•
and
performance
reviewing the performance and remuneration of
In the case of the
senior management.
Executive Chairman the two non-executive
Directors are responsible for review of Dr
Phillips’
remuneration
package;
establishing the remuneration framework for
non-executive directors, within the threshold
approved by shareholders; and
and determining equity-based
reviewing
remuneration plans for senior management and
employees.
Page | 14
DIRECTORS REPORT
The Directors present their report on Uscom Ltd and its Controlled Entities for the financial year ended 30 June 2016.
Directors
The following persons were Directors of Uscom Ltd during the whole of the financial year and up to the date of this
report, unless otherwise stated.
Executive Director - Chairman
Associate Professor R A Phillips
Non-Executive Director
Ms S Jack
Mr C Bernecker
Non-Executive Director
Mr C X He (since 23 March 2016) Non-Executive Director
Directors’ qualifications and experience
Associate Professor
Rob Phillips
Associate Professor Rob Phillips
Rob Phillips
Rob Phillips
Associate Professor
Associate Professor
Rob Phillips is the founder of Uscom Ltd, the Chief Executive Officer, Executive Director and Chief Scientist of the
Company. Rob has 13 years’ experience as Executive Chairman of the Company, having taken Uscom to IPO in 2003,
and has over 20 years in executive corporate management and capital raising. Rob has overseen the company’s
acquisition of two international medical device companies in 2013 and 2015. Rob has a Doctor of Philosophy and a Master
of Philosophy in Cardiovascular Medicine from The University of Queensland and is an Adjunct Associate Professor with
the Critical Care Research Group, at the School of Medicine, The University of Queensland. He is an Australian Post
Graduate Award recipient and was a finalist in the Time-Google-CNN-Science-NYSE World Health and Medicine
Technology Awards in 2004. Rob has pioneered novel clinical approaches to cardiovascular assessment having authored
over 30 patents and patent applications and is an internationally recognised author, teacher and examiner in the field
of cardiac ultrasound, cardiovascular function and circulation.
Ms Sheena Jack
Ms Sheena Jack
Ms Sheena Jack
Ms Sheena Jack
Ms Sheena Jack is a Non-Executive Director of Uscom Ltd since November 2011. Sheena was until recently the Chief
Financial Officer of HCF when she took up the role of HCF Chief Strategy Officer. Sheena has over 25 years’ experience
as a finance professional and corporate executive. She has had experience across a range of corporate organisations
including ASX listed companies, government and not for profit in both mature and start-up businesses. Sheena has
significant experience in mergers and acquisitions, business integration, strategy development and implementation,
capital markets and organisational transformation. Sheena is a Chartered Accountant and a graduate member of the
Australian Institute of Company Directors.
Mr Christian Bernecker
Mr Christian Bernecker
Mr Christian Bernecker
Mr Christian Bernecker
Mr Christian Bernecker is a Non-Executive Director of Uscom Ltd since November 2011. Christian is Non-Executive
Director of Stream Group Limited and has more than 10 years of broad investment experience across capital raising,
acquisitions and divestments. Christian qualified as a Chartered Accountant in Australia and holds a Bachelor of
Commerce from Ballarat University.
Mr Chao Xiao He
Mr Chao Xiao He
Mr Chao Xiao He
Mr Chao Xiao He
Mr Chao Xiao He is a Non-Executive Director of Uscom Ltd since 23 March 2016. Mr He was born in Shanghai and
educated in Sydney. For the last 9 years he was based in Shanghai and Singapore as Vice President of Business
Development APAC with Johnson & Johnson. Prior to that Mr He was an Associate at McKinsey & Company in Shanghai,
then Director of Business Development and External Growth APAC and VP Finance China with AB InBev. based in Hong
Kong and Shanghai.
Page | 15
DIRECTORS REPORT
Continued
Company Secretary’s qualifications and experience
Ms Catherine Officer
Ms Catherine Officer
Ms Catherine Officer
Ms Catherine Officer
Catherine Officer is an experienced Company Secretary and Corporate Lawyer with over 20 years experience. She has
previously hold senior positions at ASX Limited and Macquarie Group. She has a Bachelor of Laws from the University
of Melbourne. Catherine Officer resigned on 24 May 2016.
Mr Brett Crowley
Mr Brett Crowley
Mr Brett Crowley
Mr Brett Crowley
Brett Crowley was appointed as the Company Secretary on 24 May 2016. He is a practicing solicitor and a former Partner
of Ernst & Young in Hong Kong and Australia, and of KPMG in Hong Kong, and has worked in China establishing and
managing JV companies there. Mr Crowley is an experienced chairman, finance director and company secretary of ASX-
listed companies, and is a former Senior Legal Member of the NSW Civil and Administrative Tribunal.
Meetings of Directors
Directors
Board of Directors
R A Phillips
S Jack
C Bernecker
C X He (since 23 March 2016)
Meetings held while a
Director
8
8
8
2
No. of meetings attended
8
8
8
2
Page | 16
Principal activities
Uscom Ltd is engaged in the development, design,
manufacture and marketing of premium non-invasive
cardiovascular and pulmonary medical devices. Uscom
Ltd owns a portfolio of intellectual property relating to the
technology and techniques associated with these devices
and manages a worldwide network of distribution
partners for the sale of its equipment to hospitals and
other medical care locations. Uscom Ltd owns 100% of
Uscom, Inc. a company engaged in the sale and
promotion of USCOM devices primarily in the United
States, and owns 100% of Thor Laboratories KFT., a
company that manufactures respiratory devices based in
Hungary.
Operating result
The loss of the Consolidated Entity after providing for
income tax amounted to $1,915,029 (2015: $1,215,654)
Dividends
No dividends were declared or recommended for the
financial year ended 30 June 2016 (2015: nil).
Significant changes in state of affairs
There were no significant changes in state of affairs
during the financial year.
Operating and financial review
The operating and financial review is stated per the
Chairman’s letter on pages 2-5.
Events after the reporting date
Apart from the items disclosed in note 29 to the financial
statements, no other matters or circumstances have
arisen since the end of the financial year to the date of
this report, that has significantly affected or may
significantly affect the activities of the Consolidated
Entity, the results of those activities or the state of affairs
of the Consolidated Entity in the ensuing or any
subsequent financial year.
Future developments
Other than the business activities described in the annual
report and, in particular, those matters discussed in the
Operating and Financial Review, the Board is not aware
of any likely developments in the foreseeable future
which may materially impact on the financial outlook of
the Consolidated Entity.
Environmental regulations
The Consolidated Entity’s operations are not subject to
significant environmental regulation under the law of the
Commonwealth and State.
Indemnifying officers
The Consolidated Entity has paid premiums to insure all
Directors and Executives against liabilities for costs and
DIRECTORS REPORT
Continued
expenses incurred by them in defending any legal
proceedings arising out of their conduct while acting in
the capacity of Director of the Company, other than
conduct involving a wilful breach of duty in relation to the
Company.
Proceedings on behalf of the Consolidated
Entity
No person has applied to the Court under section 237 of
the Corporations Act 2001 for leave to bring proceedings
on behalf of the Consolidated Entity, or to intervene in
any proceedings to which the Consolidated Entity is a
party, for the purpose of taking responsibility on behalf of
the Consolidated Entity
for all or part of those
proceedings.
No proceedings have been brought or intervened in on
behalf of the Consolidated Entity with leave of the Court
under section 237 of the Corporations Act 2001.
Non-audit services
The Consolidated Entity may decide to employ the
auditor on assignments additional to their audit duties
where the auditor’s expertise and experience with the
Consolidated Entity are important.
The Directors are of the opinion that the provision of non-
audit services as disclosed in note 25 in the financial
report does not compromise the external auditor’s
independence as outlined in the Corporations Act 2001
for the following reasons:
• All non-audit services have been reviewed and
approved to ensure that they do not impact the
integrity and objectivity of the auditor, and
• None of the services undermine the general
principles relating to auditor independence as
set out in the Code of Conduct APES110 Code
of Ethics of Professional Accountants issued by
the Accounting
Professional and Ethical Standards Board,
including reviewing or auditing the auditor’s
own work, acting in management decision
making capacity for the Company, acting as
advocate for the Company or jointly sharing
economic risks and rewards.
•
Refer to note 25 of the financial statements on page 48
for details of auditors’ remuneration.
The auditor’s independence declaration as required
under section 307C of the Corporation Act is set out on
page 24 and forms part of the Directors’ Report.
BDO East Coast Partnership continues in office in
accordance with section 327 of the Corporations Act
2001.
Page | 17
Remuneration report (Audited)
This remuneration report has been prepared by the
Directors of Uscom Ltd to comply with the Corporations
Act 2001 and the key management personnel (KMP)
disclosures
required under Australian Accounting
Standards AASB 124 – Related Party Disclosures.
Key management personnel
Key management personnel
Key management personnel
Key management personnel
The following were key management personnel of the
Entity at the start of the financial year to the date of this
report unless otherwise stated:
NonNonNonNon----Executive Directors
Executive Directors
Executive Directors
Executive Directors
Sheena Jack, Non-Executive Director
Christian Bernecker, Non-Executive Director
Chao Xiao He, Non-Executive Director since 23 March
2016
Executive Directors
Executive Directors
Executive Directors
Executive Directors
Rob Phillips, Executive Director, Chairman, Chief
Executive Officer
Senior Executives
Senior Executives
Senior Executives
Senior Executives
Nick Schicht, General Manager
In the Directors’ opinion, there are no other Executives of
the Entity.
Remuneration policies
The Board is responsible for reviewing the remuneration
policies and practices of the Consolidated Entity,
including the compensation arrangements of Executive
Senior
Directors, Non-Executive Directors
Executives.
and
The Consolidated Entity has adopted remuneration
policies based on performance and contribution for
determining the nature and amount of emoluments of
Board Members and Senior Executives. The objective of
these policies is to:
• Make Uscom Ltd and its Controlled Entities an
employer of choice
• Attract and retain the highest calibre personnel
• Encourage a culture of reward
for effort and
contribution
• Set incentives that reward short and medium term
performance for the Consolidated Entity
• Encourage professional and personal development
In the case of Senior Executives, a recommendation for
compensation review will be made by the Chairman to
the Board, which will conduct a performance review.
NonNonNonNon----Executive Directors
Executive Directors
Executive Directors
Executive Directors
The Board determines the Non-Executive Director
remuneration by
for
comparative Companies.
independent market data
As at the date of this report the maximum aggregate
remuneration payable out of the funds of the Entity to
Non-Executive Directors of the Consolidated Entity for
DIRECTORS REPORT
Continued
their services as Directors including their service on a
committee of Directors is $165,000 per annum.
Non-Executive Directors do not receive any performance
related remuneration, therefore they do not receive
bonuses or non-cash benefits.
Non-Executive Directors’
limited to compulsory employer superannuation.
retirement payments are
Executive Directors
Executive Directors
Executive Directors
Executive Directors
uneration
remremremremuneration
uneration
uneration
and
and
and
and
Senior
Senior
Senior
Senior
Executives
Executives
Executives
Executives
The Consolidated Entity’s remuneration policy directs
that the remuneration package appropriately reflects the
Executives’ duties and
that
remuneration
levels attract and retain high calibre
Executives with the skills necessary to successfully
manage the Consolidated Entity’s operations and
achieve its strategic and financial objectives.
responsibilities and
The total remuneration packages of Executive Directors
and Senior Executives are on a salary basis. In addition to
base salary, the Company has a policy of rewarding
extraordinary contribution to the growth of the Company
with the grant of an annual discretionary cash bonus and
options under the Consolidated Entity’s Employee Share
Option Plan.
Executives are also entitled to be paid for their
reasonable travel, accommodation and other expenses
incurred in consequence on the execution of duties.
Other than the Uscom Ltd Employee Share Option Plan,
the Consolidated Entity does not provide any other non-
cash benefits in lieu of base salary to Executives.
Remuneration packages for Executive Directors and
Senior Executives generally consist of three components:
• Fixed remuneration which is made up of cash salary,
salary sacrifice components and superannuation
• Short term incentives
• Long term incentives which include issuing options
pursuant to the Uscom Ltd Employee Share Option
Plan.
Fixed remuneration
Fixed remuneration
Fixed remuneration
Fixed remuneration
Senior Executives who possess a high level of skill and
experience are offered a competitive base salary. The
performance of each Executive will be reviewed annually.
Following the review, the Consolidated Entity may in its
sole discretion
increase the salary based on that
Executive’s performance, productivity and such other
matters as the Board considers relevant. Superannuation
contribution by the Consolidated Entity is limited to the
statutory level of wages and salaries.
term incentives
Short----term incentives
Short
term incentives
term incentives
Short
Short
The remuneration of Uscom Ltd Senior Executives does
not include any short-term incentive bonuses as part of
their employment conditions. The Board may however
Page | 18
DIRECTORS REPORT
Continued
approve discretionary bonuses to Executives in relation to
certain milestones being achieved.
Long
term incentives
Long----term incentives
LongLong
term incentives
term incentives
The Consolidated Entity has adopted an Equity Incentive
Plan for the benefit of the Executive Director, an
employee, contractor, consultant or any other person
whom the Board determines to be eligible to participate
in the Plans.
The Board, at its discretion, may approve the issue of
options and rights under the Equity Incentive Plan to the
Senior Executives. The vesting of options and rights
issued may be conditional upon the achievement of
performance hurdles determined by the Board from time
to time. The Board may propose the issue of options and
rights to Directors, however this will be subject to
shareholder approval at the Annual General Meeting.
made up of two Non-Executive Directors. Reference is
made to external market information in order to retain the
most suitable Executives for meeting the entity’s goals.
Executive Directors are excluded from discussions on
their remuneration. The remuneration of key Executives
are not linked with the Consolidated Entity’s performance
as the focus is on retention of key Executives to ensure
growth and traction in what is a new market. The Board of
Directors will consider linking executive remuneration to
the Consolidated Entity’s performance once
the
Consolidated Entity has sufficient market traction.
Termination
Termination
Termination
Termination
Despite anything to the contrary in the agreement, the
Consolidated Entity or the Executive may terminate the
employment at any time by giving the other party 3
months’ notice in writing.
Independent data from applicable sources may be
requested by
the
performance hurdles have been met.
to assess whether
the Board
Service agreements
Service agreements
Service agreements
Service agreements
The Consolidated Entity has entered into an employment
agreement with the Executives that
• Outlines the components of remuneration payable;
and
• Specifies termination conditions.
Details of the employment agreement are as follows:
Each Executive may not, during the term of the
employment agreement, perform work for any other
person, corporation or business without the prior written
consent of the Consolidated Entity.
The employment terms do not prescribe the duration of
employment for executives.
Due to the small number of Executives the remuneration
committee comprises the Board of Directors which is
If either the Consolidated Entity or the Executive gives
notice of termination, the Consolidated Entity may, at its
discretion, choose
the Executive’s
employment immediately or at any time during the notice
period and pay the Executive an amount equal to the
salary due to them for the residual period of notice at the
time of termination.
terminate
to
Where the Executive gives less than 3 months written
notice, the Consolidated Entity may withhold from the
Executive’s final payment an amount equal to the shortfall
in the notice period.
The employment of each Executive may be terminated
immediately without notice or payment in lieu in the
event of any serious or persistent breach of the
agreement, any serious misconduct or wilful neglect of
duties, in the event of bankruptcy or any arrangement or
compensation being made with creditors, on conviction
of a criminal offence, permanent incapacity of the
Executive or a consistent failure to carry out duties in a
manner satisfactory to the Consolidated Entity.
Page | 19
Key management personnel remuneration
Remuneration includes salaries, benefits and superannuation contributions in respect of the financial year 2016.
DIRECTORS REPORT
Continued
NonNonNonNon----EEEExecutive
irector
xecutive DDDDirector
irector
irector
xecutive
xecutive
S Jack
C Bernecker
C X He
Executive
irector
Executive DDDDirector
irector
irector
Executive
Executive
R Phillips
Senior E
xecutive
Senior Executive
xecutive
xecutive
Senior E
Senior E
N Schicht
Short term benefits
Directors’
Base Fee
$
35,000
38,325
Base salary
$
-
-
-
-
243,000
209,000
Total
Total
Total
Total
73,325
452,000
Post employment
benefits
Superannuation
$
Other
payments
$
Share-based
payment
$
Equity
Total remuneration
$
38,325
38,325
10,500
3,325
-
-
10,500
-
-
-
40,605
225,176
508,781*
19,855
63,785
19,264
254,940
248,119
844844844844,,,,050050050050
*R Phillips cash remuneration of $243,300 included $14,000 payout from annual leave, and his superannuation of $40,605
included salary sacrifice of $16,000 payout from annual leave. His equity remuneration remains unvested.
Remuneration includes salaries, benefits and superannuation contributions in respect of the financial year 2015.
NonNonNonNon----EEEExecutive
irector
xecutive DDDDirector
irector
irector
xecutive
xecutive
S Jack
C Bernecker
Executive
irector
Executive DDDDirector
irector
irector
Executive
Executive
R Phillips
Senior E
xecutive
Senior Executive
xecutive
xecutive
Senior E
Senior E
N Schicht
Short term benefits
Directors’
Base Fee
$
35,000
38,325
Base salary
$
-
-
-
-
170,000
166,000
Total
Total
Total
Total
73,325
336,000
Post employment
benefits
Superannuation
$
3,325
-
Equity
Total remuneration
Share-based
payment
$
-
-
$
38,325
38,325
16,150
147,603
333,753
Other
payments
$
-
-
-
20,000
20,000
17,670
37,145
12,450
160,053
216,120
626626626626,,,,523523523523
Equity Incentive Plan
The Consolidated Entity has adopted a new Equity Incentive Plan for the benefit of an employee, contractor, consultant
or executive director of the Group or any other person whom the Board determines to be eligible to participate in the
Plans.
The purpose of the Plan is to:
•
•
•
•
provide Eligible Persons with an incentive plan which recognises ongoing contribution to the achievement by
the Company of its strategic goals thereby encouraging the mutual interdependence of Participants and the
Company;
align the interests of Participants with shareholders of the Company through the sharing of a personal interest
in the future growth and development of the Company as represented in the price of the Company’s ordinary
fully paid shares;
encourage Eligible Persons to improve the performance of the Company and its total return to Shareholders;
and
provide a means of attracting and retaining skilled and experienced employees.
Under the Plan, the Consolidated Entity will be able to grant short-term incentive and long-term incentive awards to
Eligible Employees (including Executive Directors). The Plan will provide the Board with the flexibility to grant equity
incentives to Eligible Persons in the form of Plan Shares, rights or Options, will only vest on the satisfaction of appropriate
hurdles.
Page | 20
DIRECTORS REPORT
Continued
Number of options over ordinary shares held by Directors and Senior Executives
Balance Granted
Exercised
1 July 2015
No.
-
-
1,000,000
100,000
1,100,000
During
FY2016
No.
During
FY2016
No.
-
-
-
-
-
-
-
(500,000)
-
(500,000)
Lapsed /
Cancelled
During
FY2016
No.
Balance
Total vested
Total
unexercisable
30 June 2016
30 June 2016
30 June 2016
No.
No.
No.
-
-
-
-
-
-
-
-
-
500,000
500,000
100,000
600,000
100,000
600,000
-
-
-
-
-
NonNonNonNon----EEEExecutive
irector
xecutive DDDDirector
irector
irector
xecutive
xecutive
S Jack
C Bernecker
Executive
irector
Executive DDDDirector
irector
irector
Executive
Executive
R Phillips
SSSSenior
xecutive
enior EEEExecutive
xecutive
xecutive
enior
enior
N Schicht
Total
Total
Total
Total
Details of options outstanding as at end of year
Holders No.
Grant date
Exercisable
at 30 June
2016
%
Expiry date
1 (Executive)
1 (Director)
1 (Consultant)
Total
Total
Total
Total
29 March 2012
7 November 2012
1 December 2014
100%
100%
67%
29 March 2017
7 November 2016
1 July 2018
30 June 2016
Outstanding
Option
No.
100,000
500,000
75,000
675,000
Exercise
Price
$
0.0595
0.0595
0.1700
Issued
date fair
value
$
0.06
0.07
0.20
The options issued prior to this financial year were issued under the previous employee option plan and had an exercise
price based on 85% of the average ASX closing price for the 5 days prior to offer/acceptance of the options. Each option
was issued for a period of 4 years, which vested 25% in tranches throughout the period.
The options issued on 1 December 2014 were issued under the Equity Incentive Plan. The options vest one third each
on the issue day 1 December 2014, 1 July 2015 and 1 July 2016.
Further details of the options are disclosed in note 18 of the financial statements.
Number of rights over ordinary shares held by Directors and Senior Executives
Balance
Granted
Exercised
1 July 2015
No.
-
-
5,409,902
450,000
5,859,902
During
FY2016
No.
During
FY2016
No.
-
-
-
-
-
-
-
-
-
-
NonNonNonNon----EEEExecutive
irector
xecutive DDDDirector
irector
irector
xecutive
xecutive
S Jack
C Bernecker
irector
Executive DDDDirector
Executive
irector
irector
Executive
Executive
R Phillips
SSSSenior
xecutive
enior EEEExecutive
xecutive
xecutive
enior
enior
N Schicht
Total
Total
Total
Total
Lapsed /
Cancelled
Balance
Total
vested
Total
unexercisable
During FY2016
30 June 2016
30 June 2016
30 June 2016
No.
No.
No.
No.
-
-
-
-
-
-
-
5,409,902
450,000
5,859,902
-
-
-
-
-
-
-
5,409,902
450,000
5,859,902
Details of rights outstanding as at end of year
Holders No.
Grant date
1 (Director)
1 (Executive)
Total
Total
Total
Total
26 November 2014
26 November 2014
Exercisable
at 30 June
2016
%
0%
0%
Expiry date
1 July 2020
1 July 2020
30 June 2016
Outstanding
Right
No.
5,409,902
450,000
5,859,902
Exercise
Price
$
0.00
0.00
Issued
date fair
value
$
0.19
0.19
Page | 21
DIRECTORS REPORT
Continued
5,409,902 Indeterminate Rights were issued to Rob Phillips on the terms and conditions approved by shareholders at the
AGM on 26 November 2014. Vesting is dependent on performance hurdles on 1 July 2018, 1 July 2019 & 1 July 2020.
Consideration payable upon vesting is $nil. The Board may exercise its discretion to pay cash in lieu of the issue of
ordinary shares.
450,000 Performance Rights were issued to Nick Schicht on 26 November 2014, vesting is dependent on performance
hurdles on 1 July 2018, 1 July 2019 and 1 July 2020. Consideration payable upon vesting is $nil.
Number of rights over ordinary shares held by Directors and Senior Executives
Balance
1 July 2015
No.
Received as
Remuneration
No.
Options
Exercised
No.
Net change
Other*
No.
Balance
30 June 2016
No.
NonNonNonNon----EEEExecutive
irector
xecutive DDDDirector
irector
irector
xecutive
xecutive
S Jack
C Bernecker
irector
Executive DDDDirector
Executive
irector
irector
Executive
Executive
R Phillips
SSSSenior E
xecutive
enior Executive
xecutive
xecutive
enior E
enior E
N Schicht
Total
Total
Total
Total
796,667
-
17,046,733
218,200
18,061,600
-
-
-
-
-
-
-
3,333
-
800,000(1)
-
500,000
33,333
17,580,066(2)
-
-
218,200(3)
500,000
36,666
18,598,266
*Net change other refers to share purchased or sold during the financial year, or cessation of categorisation as a Director or Senior Executive.
(1) All these ordinary shares are held by family associate.
(2) 7,577,433 of these ordinary shares are held by Australian Cardiac Sonography Pty Ltd as trustee for the Phillips Superannuation.
(3) 10,000 of these ordinary shares are held by family associate.
Additional Information
The earnings of the consolidated entity for the five years to 30 June 2016 are summarised below:
2016
2016
2016
2016
$
2015
2015
2015
2015
$
2014
2014
2014
2014
$
2013
2013
2013
2013
$
2012
2012
2012
2012
$
Sales Revenue
2,482,925
1,515,381
1,056,502
578,753
794,135
Loss after income tax
(1,915,029)
(1,215,654)
(1,520,500)
(1,371,683)
(1,824,547)
The factors that are considered to affect total shareholders return (‘TSR’) are summarised below:
2016
2016
2016
2016
2015
2015
2015
2015
2014
2014
2014
2014
2013
2013
2013
2013
Share Price at financial year end ($)
Total dividends declared (cents per share)
Basic earnings declared (cents per share)
0.25
-
(2.0)
0.19
-
(1.5)
0.22
-
(2.0)
0.17
-
(2.2)
2012
2012
2012
2012
0.094
-
(3.5)
Page | 22
DIRECTORS REPORT
Continued
This concludes the remuneration report, which has been audited.
This Directors’ report is signed in accordance with a resolution of the Board of Directors, pursuant to section 298(2)(a) of
the Corporations Act 2001.
Associate Professor Rob Phillips
Ms Sheena Jack
Executive Director - Chairman
Non-Executive Director
Sydney, 17 August 2016
Page | 23
AUDITORS INDEPENDENCE
DECLARATION
Tel: +61 2 9251 4100
Fax: +61 2 9240 9821
www.bdo.com.au
Level 11, 1 Margaret St
Sydney NSW 2000
Australia
DECLARATION OF INDEPENDENCE BY GARETH FEW TO THE DIRECTORS OF USCOM LIMITED
As lead auditor of Uscom Limited for the year ended 30 June 2016, I declare that, to the best of my
knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Uscom Limited and the entites it controlled during the period.
Gareth Few
Partner
BDO East Coast Partnership
BDO East Coast Partnership
BDO East Coast Partnership
BDO East Coast Partnership
Sydney, 17 August 2016
BDO East Coast Partnership ABN 83 236 985 726 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO East Coast Partnership and BDO (Australia) Ltd are members of BDO International
Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation, other than for the acts or omissions of financial services licensees.
Page | 24
STATEMENT OF PROFIT OR LOSS
& OTHER COMPREHENSIVE INCOME
For the FY ended 30 June 2016
Continuing operations
Revenue and other income
Raw materials and consumables used
Expenses from continuing activities
from continuing operations
income tax from continuing operations
Loss before income tax
Loss before
from continuing operations
from continuing operations
income tax
income tax
Loss before
Loss before
Income tax
from continuing operations
Loss after income tax from continuing operations
Loss after income tax
from continuing operations
from continuing operations
Loss after income tax
Loss after income tax
nsive income
Other compreheeeensive income
Other compreh
nsive income
nsive income
Other compreh
Other compreh
or loss
Items that may be reclassified subsequently to profit or loss
Items that may be reclassified subsequently to profit
or loss
or loss
Items that may be reclassified subsequently to profit
Items that may be reclassified subsequently to profit
Foreign currency translation difference for foreign operations
Other comprehensive income for the year, net of tax
olidated
ConsConsConsConsolidated
olidated
olidated
2016
2016
2016
2016
$
2015
$
2,936,504
(708,013)
(4,131,930)
2,039,426
(341,718)
(2,913,362)
(1,903,439)
(1,215,654)
(11,590)
-
(1,915,029)
(1,215,654)
Note
3
4
5
6
(18,250)
(18,250)
3,511
3,511
year
for the year
income for the
Total comprehensive income
Total comprehensive
year
year
for the
for the
income
income
Total comprehensive
Total comprehensive
(1,933,279)
(1,212,143)
Attributable to:
Attributable to:
Attributable to:
Attributable to:
Owners of the Company
(1,933,279)
(1,212,143)
year
for the year
income for the
Total comprehensive income
Total comprehensive
year
year
for the
for the
income
income
Total comprehensive
Total comprehensive
(1,933,279)
(1,212,143)
Earnings per share from continuing operations attributable to the
Earnings per share from continuing operations attributable to the
Earnings per share from continuing operations attributable to the
Earnings per share from continuing operations attributable to the
owners of the Company
owners of the Company
owners of the Company
owners of the Company
Earnings per share (EPS)
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
7
7
(2.0)
(2.0)
(1.5)
(1.5)
This Statement of Profit or Loss and Other Comprehensive Income is to be read in conjunction with the attached notes.
Page | 25
STATEMENT OF FINANCIAL
POSITION
As at 30 June 2016
Consolidated
Consolidated
Consolidated
Consolidated
Note
2012012012016666
$
2015
2015
2015
2015
$
8
9
10
11
14
12
13
15
16
16
2,839,773
267,751
418,707
429,516
137,039
4,092,786
526,317
300,753
525,672
366,831
104,820
1,824,393
74,895
1,544,065
1,618,960
46,150
1,065,812
1,111,962
5,711,746
2,936,355
545,899
209,902
755,801
418,524
196,073
614,597
17,954
17,954
33,097
33,097
773,755
647,694
4,937,991
2,288,661
17
18
6
19
30,308,877
2,099,893
(27,533,620)
62,841
26,019,429
1,806,732
(25,618,591)
81,091
4,937,991
2,288,661
Current assets
Current assets
Current assets
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Tax asset
Other assets
Total current assets
current assets
NonNonNonNon----current assets
current assets
current assets
Plant and equipment
Intangible assets
Total non-current assets
Total assets
Total assets
Total assets
Total assets
Current liabilities
Current liabilities
Current liabilities
Current liabilities
Trade and other payables
Current provisions
Total current liabilities
NonNonNonNon----current liabilities
current liabilities
current liabilities
current liabilities
Non-current provisions
Total non-current liabilities
Total liabilities
Net assets
Net assets
Net assets
Net assets
Equity
Equity
Equity
Equity
Issued capital
Options and rights reserve
Accumulated losses
Translation reserve
Total equity
Total equity
Total equity
Total equity
This Statement of Financial Position is to be read in conjunction with the attached notes.
Page | 26
STATEMENT OF CHANGES
IN EQUITY
For the FY ended 30 June 2016
Issued
Issued
Issued
Issued
Capital
Capital
Capital
Capital
Options
Options
Options
Options
Reserve
Reserve
Reserve
Reserve
Accumulated
Accumulated
Accumulated
Accumulated
Losses
Losses
Losses
Losses
Consolidatedtedtedted
Consolida
Consolida
Consolida
$
$
$
Foreign
Foreign
Foreign
Foreign
Currency
Currency
Currency
Currency
Translation
Translation
Translation
Translation
Reserve
Reserve
Reserve
Reserve
$
Total
Total
Total
Total
$
Balance at 30 June 2014141414
Balance at 30 June 20
Balance at 30 June 20
Balance at 30 June 20
Loss for the year
Other Comprehensive
Income
Total Comprehensive
Income for the year
Transactions with Owners in
their capacity as owners:
Shares Issued
Transaction
Transaction
Transaction
Transaction
Shares Issued
Shares Issued
Shares Issued
Shares Issued
Share-based payments
costs
costs
costs
costs
on
on
on
on
26,006,168
1,638,582
(24,402,937)
77,580
3,319,393
-
-
-
14,875
(1,614)
-
-
-
-
-
-
168,150
(1,215,654)
-
(1,215,654)
-
3,511
3,511
(1,215,654)
3,511
(1,212,143)
-
-
-
-
-
-
14,875
(1,614)
168,150
2015
Balance at 30 June 2015
Balance at 30 June
2015
2015
Balance at 30 June
Balance at 30 June
26,019,429
1,806,732
(25,618,591)
81,091
2,288,661
Comprehensive
Comprehensive
Comprehensive
Comprehensive
Loss for the year
Other Comprehensive
Income
Total
Total
Total
Total
Income
for the year
Income for the year
for the year
for the year
Income
Income
Transactions with Owners in
their capacity as owners:
Shares Issued
Transaction
Transaction
Transaction
Transaction
Shares Issued
Shares Issued
Shares Issued
Shares Issued
Share-based payments
costs
costs
costs
costs
on
on
on
on
-
-
-
4,539,630
(250,182)
-
-
-
-
-
-
293,161
(1,915,029)
-
(1,915,029)
-
(18,250)
(18,250)
(1,915,029)
(18,250)
(1,933,279)
-
-
-
-
-
-
4,539,630
(250,182)
293,161
2016
Balance at 30 June 2016
Balance at 30 June
2016
2016
Balance at 30 June
Balance at 30 June
30,308,877
2,099,893
(27,533,620)
62,841
4,937,991
This Statement of Changes in Equity is to be read in conjunction with the attached notes.
Page | 27
STATEMENT OF CASH FLOWS
For the FY ended 30 June 2016
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
2015
2015
2015
2015
$
Note
Cash flows from operating activities
Cash flows from operating activities
Cash flows from operating activities
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Interest received
Payments to suppliers and employees (inclusive of GST)
Grant and other income received
2,563,145
10,733
(4,231,505)
366,831
1,321,080
12,652
(2,639,578)
313,050
Net cash used in operating activities
20(b)
(1,290,796)
(992,796)
Cash flows from investing activities
Cash flows from investing activities
Cash flows from investing activities
Cash flows from investing activities
Purchase of patents and trademarks
Purchase of plant and equipment
Acquisition of Thor Laboratories – Net of cash acquired
(91,365)
(2,507)
(591,324)
(60,370)
(16,612)
-
27
Net cash used in investing activities
(685,196)
(76,982)
sh flows from financing activities
CaCaCaCash flows from financing activities
sh flows from financing activities
sh flows from financing activities
Issue of shares (net of share issue cost)
Net cash provided by financing activities
Net increase/(decrease) in cash held
Net increase/(decrease) in cash held
Net increase/(decrease) in cash held
Net increase/(decrease) in cash held
Cash and cash equivalents at the beginning of the year
Exchange rate adjustment for opening balance
Cash and cash equivalents at the end of the year
Cash and cash equivalents at the end of the year
Cash and cash equivalents at the end of the year
Cash and cash equivalents at the end of the year
17
4,289,448
13,261
4,289,448
13,261
2,313,456
527,631
(1,314)
2,839,773
(1,056,517)
1,588,214
(5,380)
526,317
20 (a)
This Statement of Cash Flows is to be read in conjunction with the attached notes.
Page | 28
NOTES TO FINANCIAL
STATEMENTS
Continued
aggregation criteria and clarifies that a reconciliation of
the total reportable segment assets to the entity's assets
is required only if segment assets are reported regularly
to the chief operating decision maker; AASB 13 'Fair
Value Measurement': clarifies
the portfolio
exemption applies to the valuation of contracts within the
scope of AASB 9 and AASB 139; AASB 116 'Property,
Plant and Equipment' and AASB 138 'Intangible Assets':
clarifies that on revaluation, restatement of accumulated
depreciation will not necessarily be
in the same
proportion to the change in the gross carrying value of
the asset; AASB 124 'Related Party Disclosures': extends
the definition of 'related party' to include a management
entity that provides KMP services to the entity or its
parent and requires disclosure of the fees paid to the
management entity; AASB 140 'Investment Property':
clarifies that the acquisition of an investment property
may constitute a business combination.
that
Note 2: Statement of significant accounting
policies
Introduction
Introduction
Introduction
Introduction
(a)
(a)
(a)
(a)
The financial report covers the Consolidated Entity of
Uscom Ltd and its Controlled Entities. Uscom Ltd is a
listed public company, incorporated and domiciled in
Australia.
and marketing
Operations
and principal activities
Operations and principal activities
and principal activities
and principal activities
Operations
Operations
Uscom Ltd is engaged in the development, design,
manufacture
non-invasive
cardiovascular and pulmonary monitoring devices.
Uscom Ltd owns a portfolio of intellectual property
relating to the technology and techniques associated
with these devices and manages a worldwide network of
distribution partners for the sale of its equipment to
hospitals and other medical care locations.
of
Scope of financial statements
Scope of financial statements
Scope of financial statements
Scope of financial statements
The financial report is a general purpose financial report
that has been prepared in accordance with Australian
Accounting
Accounting
Interpretations, the Corporations Act 2001 and complies
with other requirements of the law, as appropriate for-
profit oriented entities.
Standards,
Australian
The financial report complies with Australian Accounting
Standards as
issued by the Australian Accounting
Standards Board and International Financial Reporting
Standards
International
Accounting Standards Board.
issued by
(IFRS) as
the
Currency
Currency
Currency
Currency
The financial report is presented in Australian dollars,
which
functional and
presentational currency.
the Parent Company’s
is
Note 1: Adoption of new and revised
accounting standards
New, revised or amending Accounting Standards and
New, revised or amending Accounting Standards and
New, revised or amending Accounting Standards and
New, revised or amending Accounting Standards and
Interpretations adopted
Interpretations adopted
Interpretations adopted
Interpretations adopted
The consolidated entity has adopted all of the new,
revised or amending Accounting Standards and
Interpretations issued by the Australian Accounting
Standards Board ('AASB') that are mandatory for the
current reporting period.
Any new, revised or amending Accounting Standards or
Interpretations that are not yet mandatory have not been
early adopted. The adoption of these Accounting
Standards and Interpretations did not have any significant
impact on the financial performance or position of the
consolidated entity.
The following Accounting Standards and Interpretations
are most relevant to the consolidated entity:
AASB 2012----3 Amendments to Australian Accounting
AASB 2012
3 Amendments to Australian Accounting
3 Amendments to Australian Accounting
3 Amendments to Australian Accounting
AASB 2012
AASB 2012
Standards
Offsetting Financial Assets and Financial
Standards ---- Offsetting Financial Assets and Financial
Offsetting Financial Assets and Financial
Offsetting Financial Assets and Financial
Standards
Standards
Liabilities
Liabilities
Liabilities
Liabilities
The consolidated entity has applied AASB 2012-3 from 1
July 2014. The amendments add application guidance to
address
the
in
offsetting criteria in AASB 132 'Financial Instruments:
Presentation', by clarifying the meaning of 'currently has
a legally enforceable right of set-off'; and clarifies that
some gross settlement systems may be considered to be
equivalent to net settlement.
the application of
inconsistencies
AASB 2013
3 Amendments to AASB 136 ----
AASB 2013----3 Amendments to AASB 136
3 Amendments to AASB 136
3 Amendments to AASB 136
AASB 2013
AASB 2013
Financial
Recoverable Amount Disclosures for Non----Financial
Recoverable Amount Disclosures for Non
Financial
Financial
Recoverable Amount Disclosures for Non
Recoverable Amount Disclosures for Non
Assets
Assets
Assets
Assets
The consolidated entity has applied AASB 2013-3 from 1
July 2014. The disclosure requirements of AASB 136
'Impairment of Assets' have been enhanced to require
additional information about the fair value measurement
when the recoverable amount of impaired assets is based
on fair value less costs of disposals. Additionally, if
measured using a present value technique, the discount
rate is required to be disclosed.
AASB 2014
1 Amendments to Australian Accounting
AASB 2014----1 Amendments to Australian Accounting
1 Amendments to Australian Accounting
1 Amendments to Australian Accounting
AASB 2014
AASB 2014
Standards (Parts A to C)
Standards (Parts A to C)
Standards (Parts A to C)
Standards (Parts A to C)
The consolidated entity has applied Parts A to C of AASB
2014-1 from 1 July 2014. These amendments affect the
following standards: AASB 2 'Share-based Payment':
clarifies the definition of 'vesting condition' by separately
'service
defining a
condition' and amends
'market
condition'; AASB 3 'Business Combinations': clarifies that
contingent consideration in a business combination is
subsequently measured at fair value with changes in fair
value recognised in profit or loss irrespective of whether
the contingent consideration is within the scope of AASB
9; AASB 8 'Operating Segments': amended to require
in applying the
disclosures of
'performance condition' and a
the definition of
judgements made
Page | 29
Note 2: Statement of significant accounting
policies (continued)
Historical Cost Convention
Historical Cost Convention
Historical Cost Convention
Historical Cost Convention
This financial report has been prepared under the
Historical Cost Convention.
Reporting period
Reporting period
Reporting period
Reporting period
The financial report is presented for the year ended 30
June 2016. The comparative reporting period was for the
year ended 30 June 2015.
NOTES TO FINANCIAL
STATEMENTS
Continued
A financial asset is derecognised when the contractual
rights to the cash flows from the financial assets expire or
are transferred and no longer controlled by the Entity. A
financial liability is removed from the statement of
financial position when the obligation specified in the
contract is discharged or cancelled or expires.
Upon initial recognition a financial asset or financial
liability is designated as at fair value through profit or loss
except for investments in equity instruments that do not
have a quoted market price in an active market and whose
fair value cannot be reliably measured.
Comparatives
Comparatives
Comparatives
Comparatives
Where required by Accounting Standards comparative
figures have been adjusted to conform with changes in
presentation for the current financial year.
A gain or loss arising from a change in the fair value of a
financial asset or financial liability classified as at fair value
through profit or loss is recognised in the statement of
profit and loss and other comprehensive income.
Registered office
Registered office
Registered office
Registered office
Level 7, 10 Loftus Street, Sydney NSW 2000.
Authorisation of financial report
Authorisation of financial report
Authorisation of financial report
Authorisation of financial report
The financial report was authorised for issue on 15 August
2016 by the Directors.
(b) Overall policy
Overall policy
(b)
Overall policy
Overall policy
(b)
(b)
The principal accounting policies adopted by the
Consolidated Entity are stated in order to assist in the
general understanding of the financial report.
ssumptions
udgment and kkkkey ey ey ey aaaassumptions
Significant jjjjudgment and
Significant
ssumptions
ssumptions
udgment and
udgment and
Significant
Significant
(c)
(c)
(c)(c)
The Directors evaluate estimates and
judgements
incorporated into the financial report based on historical
knowledge and best available current
information.
Estimates assume a reasonable expectation of future
events and are based on current trends and economic
data, obtained both externally and within the Entity.
The Consolidated Entity assesses impairment at each
reporting date by evaluating conditions specific to the
group that may lead to impairment of assets. Where an
impairment trigger exists, the recoverable amount of the
asset is determined.
The consolidated entity assesses impairment of non-
financial assets other than goodwill and other indefinite
life intangible assets at each reporting date by evaluating
conditions specific to the consolidated entity and to the
particular asset that may lead to impairment. If an
impairment trigger exists, the recoverable amount of the
asset is determined. This involves fair value less costs of
disposal or value-in-use calculations, which incorporate a
number of key estimates and assumptions.
(d) Financial as
inancial liabilities
sets and ffffinancial liabilities
Financial assets and
(d)
inancial liabilities
inancial liabilities
sets and
sets and
Financial as
Financial as
(d)
(d)
Financial assets and financial liabilities are recognised on
the Statement of Financial Position when
the
Consolidated Entity becomes party to the contractual
provisions of the financial instrument.
Financial assets not measured at fair value comprise
receivables and investment in subsidiary. These are non-
derivative financial assets with fixed or determinable
payments that are not quoted in an active market and are
measured at amortised cost using the effective interest
method.
Available-for-sale financial assets include other financial
assets, comprising
in subsidiaries, not
investments
included in the above categories. Available-for-sale
financial assets are reflected at fair value. Unrealised
gains and losses arising from changes in fair value are
taken directly to equity.
Financial liabilities comprise of trade and other payables,
and borrowings and are measured at amortised cost
using the effective interest method.
Trade accounts payable represent the principal amounts
outstanding at reporting date plus, where applicable, any
accrued interest.
The amortised cost of a financial asset or a financial
liability is the amount initially recognised minus principal
repayments, plus or minus cumulative amortisation of any
difference between the initial amount and maturity
amount and minus any write-down for impairment or
uncollectibility.
Financial assets, other than those at fair value through
profit or loss, are reassessed for indicators of impairment
at each reporting date. Financial assets are impaired
where there is objective evidence that as a result of one
or more events that occurred after the initial recognition
of the financial asset the estimated future cash flows of
the investment have been impacted.
For financial assets carried at amortised cost, the amount
of the impairment is the difference between the asset’s
carrying amount and the present value of estimated
future cash flows, discounted at the original effective
interest rate.
Page | 30
Note 2: Statement of significant accounting
policies (continued)
The carrying amount of the financial asset is reduced by
the impairment loss directly for all financial assets with the
exception of trade receivables where the carrying amount
is reduced through the use of an allowance account.
When a trade receivable is uncollectible, it is written off
against the allowance account. Subsequent recoveries of
amounts previously written off are credited against the
allowance account. Changes in the carrying amount of the
allowance account are recognised in profit or loss.
With
the exception of available-for-sale equity
instruments, if, in a subsequent period, the amount of the
impairment loss decreases and the decrease can be
related objectively to an event occurring after the
impairment was recognised, the previously recognised
impairment loss is revered through profit or loss to the
extent the carrying amount of the investment at the date
the impairment is reversed does not exceed what the
amortised cost would have been had the impairment not
been recognised.
(e) Principles of
onsolidation
Principles of cccconsolidation
(e)
onsolidation
onsolidation
Principles of
Principles of
(e)
(e)
A Controlled Entity is any entity Uscom Ltd has the power
to control the financial and operating policies of so as to
obtain benefits from its activities.
A list of Controlled Entities is contained in note 22 to the
financial statements. All Controlled Entities have a June
financial year-end.
in the Consolidated Group,
All inter-company balances and transactions between
Entities
including any
unrealised profits or losses, have been eliminated on
consolidation. Accounting policies of Subsidiaries have
been changed where necessary to ensure consistencies
with those polices applied by the Parent Entity.
On consolidation, the assets and
liabilities of the
Consolidated Entity’s overseas operations are translated
at exchange rates prevailing at the reporting dates.
Income and expense items are translated at the average
exchange rates for the period unless exchange rates
fluctuate significantly. Exchange differences arising, if
any, are recognised in the foreign currency translation
reserve, and are recognised in statement of profit or loss
and other comprehensive income on disposal of the
foreign operation.
(f)(f)(f)(f)
alances
ransactions and d d d bbbbalances
urrency ttttransactions an
Foreign ccccurrency
Foreign
alances
alances
ransactions an
ransactions an
urrency
urrency
Foreign
Foreign
All foreign currency transactions during the financial year
are brought to account using the exchange rate in effect
at the date of the transaction. Foreign currency monetary
items at reporting date are translated at the exchange
rate existing at reporting date. Non-monetary assets and
liabilities carried at fair value that are denominated in
NOTES TO FINANCIAL
STATEMENTS
Continued
foreign currencies are translated at the rates prevailing at
the date when the fair value was determined. Non-
monetary items that are measured in terms of historical
cost in a foreign currency are not retranslated.
The gains and losses from conversion of assets and
liabilities, whether realised or unrealised, are included in
profit or loss from continuous operations as they arise.
(g) Revenue
(g)
ecognition
Revenue rrrrecognition
(g)
ecognition
ecognition
Revenue
Revenue
(g)
• Sale of goods
Revenue from the sale of goods is recognised when
all significant risks and rewards of ownership have
been transferred to the buyer and when the other
contractual obligations of the Entity are performed.
• Revenue from rendering of services
•
supplied
Rendering of services consists of training, repair and
product maintenance
to customers.
Revenue is recognised when contractual obligations
are expired and services are provided.
Interest revenue
Interest revenue is recognised on a proportional basis
taking into account the interest rates applicable to the
financial assets.
• Government grants
Government grants revenue is recognised at fair value
when there is reasonable assurance that the grant will
be received and the grant conditions will be met.
Inventoriesiesiesies
Inventor
Inventor
Inventor
(h)
(h)
(h)
(h)
Inventories are measured at the lower of cost or net
realisable value. Costs are assigned on the basis of
weighted average costs. Cost comprises all costs of
purchase and conversion and an appropriate proportion
of fixed and variable overheads, net of settlement
discounts. Overheads are applied on the basis of normal
operative capacity. The costs are recognised when
materials are delivered to the Consolidated Entity.
(i)(i)(i)(i)
lant and equipment
Property, pppplant and equipment
Property,
lant and equipment
lant and equipment
Property,
Property,
Property, plant and equipment are included at cost.
Assets in plant and equipment are depreciated on
diminishing value basis over their estimated useful lives
covering a period of two to seven years.
On disposal of an item of property, plant and equipment,
the difference between the sales proceeds and the
carrying amount of the asset is recognised as a gain or
loss in the statement of profit or loss and other
comprehensive income.
The depreciation rates used for each class of depreciable
assets are:
Class Of Fixed Asset
Depreciation Rate
- Plant & Equipment
- Office Furniture & Equipment
- Computer Software
- Low Value Pool
10% - 40%
15%
40%
37.5%
Page | 31
Note 2: Statement of significant accounting
policies (continued)
Intangibles
Intangibles
Intangibles
Intangibles
(j)(j)(j)(j)
Patents and Trademarks are valued in the financial
statements at cost of acquisition less accumulated
amortisation and are amortised on diminishing value
basis at 12.5% per annum.
The value of Regulatory Approvals was recognised at the
acquisition of Thor Laboratories. Regulatory Approvals
are amortised over 5 years on straight line basis from the
date of acquisition.
ssets
Impairment of aaaassets
Impairment of
ssets
ssets
Impairment of
Impairment of
(k)
(k)
(k)(k)
At each reporting date, the Consolidated Entity reviews
the carrying values of its tangible and intangible assets to
determine whether there is any indication that those
assets have been impaired. If such an indication exists,
the recoverable amount of the asset, being the higher of
the asset’s fair value less costs to sell and value in use, is
compared to the asset’s carrying value. Any excess of the
asset’s carrying value over its recoverable amount is
expensed to the statement of profit or loss and other
comprehensive income. In assessing value in use, the
estimated future cash flows discounted to their present
value using a pre-tax discount rate.
Leases
Leases
Leases
Leases
(l)(l)(l)(l)
Lease of assets where substantially all the risks and
benefits incidental to the ownership of the asset, but not
the legal ownership, are transferred to the Consolidated
Entity were classified as finance leases. Finance leases are
capitalised, recording an asset and a liability equal to the
present value of the minimum lease payments, including
any guaranteed residual values.
NOTES TO FINANCIAL
STATEMENTS
Continued
Investments
Investments
Investments
Investments
(n)
(n)
(n)
(n)
Investments in Controlled Entities are carried at the lower
of cost and recoverable amount.
(o) Research &
(o)
xpenditure
evelopment eeeexpenditure
Research & ddddevelopment
xpenditure
xpenditure
evelopment
evelopment
Research &
Research &
(o)
(o)
Research & development costs are charged to the
statement of profit or loss and other comprehensive
income as incurred, or deferred where it is probable that
sufficient future benefits will be derived so as to recover
those deferred costs.
Income ttttaxaxaxax
Income
Income
Income
(p)
(p)
(p)
(p)
Income taxes are accounted for using the Balance Sheet
liability method whereby:
• The tax consequences of recovering (settling) all
financial
(liabilities) are reflected
in the
assets
statements;
• Current and deferred tax is recognised as income or
expenses except to the extent that the tax relates to
equity items or to a business combination;
• A deferred tax asset is recognised to the extent that it
is probable that future taxable profit will be available
to realise the asset;
• Deferred tax assets and liabilities are measured at the
tax rates that are expected to apply to the period
when the asset is realised or the liability settled.
The charge for current income tax expense/credit is
based on the profit or loss for the year adjusted for any
non- assessable or disallowed items. It is credited using
tax rates that have been enacted or are substantively
enacted by the reporting date.
Deferred tax is accounted for using the Balance Sheet
liability method in respect of temporary differences
arising between the tax bases of assets and liabilities and
their carrying amounts in the financial statements.
Leased assets are amortised on diminishing value basis
over their estimated useful lives where it is likely that the
Consolidated Entity will obtain ownership of the asset or
over the term of the lease. Lease payments are allocated
between the reduction of the lease liability and the lease
interest expense for the period.
Deferred tax is calculated at the tax rates that are
expected to apply to the period when the asset is realised
or liability is settled. Deferred tax is credited in the
income statement except where it relates to items that
may be credited directly to equity, in which case the
deferred tax is adjusted directly against equity.
Lease payments for operating leases, where substantially
all the risks and benefits remain with the lessor, are
recognised as an expense on a straight line basis over the
lease term unless another systematic basis is more
representative of the time pattern in which benefits are
diminished.
Lease incentives under operating leases are recognised
as liabilities. The incentives are recognised as a reduction
of expenses on a straight line basis unless another
systematic basis is more representative of the time
pattern in which benefits are diminished.
(m) Cash and cash equivalents
(m)
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents
(m)
(m)
Cash and cash equivalents comprise cash on hand and at
call deposits with banks or financial institutions.
Deferred income tax assets are recognised to the extent
that it is probable that future tax profits will be available
against which deductible temporary differences can be
utilised.
The amount of benefits brought to account or which may
be realised in the future is based on the assumption that
no adverse change will occur
income taxation
legislation and the anticipation that the Consolidated
Entity will derive sufficient future assessable income to
enable the benefit to be realised and comply with the
conditions of deductibility imposed by the law.
in
Page | 32
NOTES TO FINANCIAL
STATEMENTS
Continued
the goods or services received provided this can be
estimated reliably. If a reliable estimate cannot be made
the value of the goods or services is determined indirectly
by reference to the fair value of the equity instrument
granted.
Transactions with employees and others providing similar
services are measured by reference to the fair value at
grant date of the equity instrument granted.
(t)(t)(t)(t) Goods and
ax (GST)
ervices ttttax (GST)
Goods and sssservices
ax (GST)
ax (GST)
ervices
ervices
Goods and
Goods and
Revenues, expenses and assets are recognised net of the
amount of GST, except where the amount of GST
incurred is not recoverable from the Australian Tax Office.
In these circumstances the GST is recognised as part of
the cost of acquisition of the asset or as part of an item of
the expense. Receivables and payables in the Statement
of Financial Position are shown inclusive of GST.
(u) Receivables
(u)
Receivables
(u)
Receivables
Receivables
(u)
Trade receivables and other receivables represent the
principal amounts due at reporting date plus accrued
interest and less, where applicable, any unearned income
and provision for doubtful accounts. An estimated
doubtful debt is made when collection of the full amount
is no longer probable.
(v) Contingent
iabilities
Contingent lllliabilities
(v)
iabilities
iabilities
Contingent
Contingent
(v)(v)
A contingent loss is recognised as an expense and a
liability if it is probable that future events will confirm that,
after taking into account any related probable recovery,
an asset has been impaired or a liability incurred and, a
reasonable estimate of the amount of the resulting loss
can be made.
(w) Warranties
Warranties
(w)
Warranties
Warranties
(w)
(w)
Provision is made in respect of the Consolidated Entity’s
estimated liability on all products and services under
warranty at reporting date. The provision is measured at
the present value of future cash flows estimated to be
required to settle the warranty obligation. The future cash
flows have been estimated by
the
reference
Consolidated Entity’s history of warranty claims.
to
(x)
reporting ddddateateateate
Events after the reporting
Events after the
(x)
reporting
reporting
(x)(x)
Events after the
Events after the
Assets and liabilities are adjusted for events incurring
after the reporting date that provide evidence of
conditions existing at the reporting date. Important after
reporting date events which do not meet these criteria
are disclosed in note 29 to the financial statements.
(y) Business combination
(y)
Business combinationssss
Business combination
Business combination
(y)(y)
Assets and liabilities are adjusted for events incurring
after the reporting date that provide evidence of
conditions.
Note 2: Statement of significant accounting
policies (continued)
Where the Consolidated Entity is entitled to a research
and development tax offset, this is treated as other
income in the period to which the entitlement relates.
than
termination
(q) Short term employee benefits
(q)
Short term employee benefits
(q)
Short term employee benefits
Short term employee benefits
(q)
Short term employee benefits are employee benefits
(other
equity
compensation benefits) which fall due wholly within 12
months after the end of the period in which employee
services are rendered. They comprise wages, salaries,
social security obligations, short-term compensation
absences, profit sharing and bonuses payables within 12
benefits
and
months and non-mandatory benefits such as medical
care, housing, car and service goods.
The provision for employee entitlements to wages,
salaries and annual leave represents the amount that the
Consolidated Entity has a present obligation to pay
resulting
from employee services provided up to
reporting date. The provision has been calculated after
taking into consideration estimated future increases in
wages and salaries and past experience regarding staff
departures and includes related on-costs.
The undiscounted amount of short-term benefits
expected to be paid is recognised as an expense.
(r)(r)(r)(r)
enefits
mployee bbbbenefits
erm eeeemployee
Long tttterm
Long
enefits
enefits
mployee
mployee
erm
erm
Long
Long
Long term employee benefits include long-service leave,
long-term disability benefits, deferred compensation and
profit sharing and bonuses payable 12 months or more
after the end of the period in which employee services are
rendered.
Uscom Ltd has adopted an Employee Share Option Plan
for the benefit of Executive Directors and full-time or part-
time staff members employed by the Consolidated Entity.
Refer note 18 to the financial statements for details.
An Executive Share Option Plan has also been developed
to provide approved participants further incentive in their
performance
the Consolidated Entity and an
opportunity to acquire an ownership interest in the
Consolidated Entity.
for
(s)(s)(s)(s)
based payment arrangement
Share----based payment arrangement
Share
based payment arrangement
based payment arrangement
Share
Share
Goods or services received or acquired in a share-based
payment transaction are recognised as an increase in
equity if the goods or services were received in an equity-
settled share based payment transaction or as a liability if
the goods and services were acquired in a cash settled
share based payment transaction.
For equity-settled share based transactions, goods or
services received are measured directly at the fair value of
Page | 33
Note 2: Statement of significant accounting
policies (continued)
A business combination is accounted for by applying the
acquisition method, unless it is a combination involving
entities or businesses under common control. The
business combination will be accounted for from the date
that control is obtained, whereby the fair value of the
identifiable assets acquired and liabilities (including
contingent liabilities) assumed is recognised (subject to
certain limited exemptions).
to
initial
recognition,
When measuring the consideration transferred in the
business combination, any asset or liability resulting from
a contingent consideration arrangement is also included.
contingent
Subsequent
consideration classified as equity is not remeasured and
its subsequent settlement is accounted for within equity.
Contingent consideration classified as an asset or liability
is remeasured in each reporting period to fair value,
recognising any change to fair value in profit or loss,
unless the change in value can be identified as existing at
acquisition date.
All transaction costs incurred in relation to business
combinations, other than those associated with the issue
of a financial instrument, are recognised as expenses in
profit or loss when incurred.
New Accounting Standards for Application in Future
New Accounting Standards for Application in Future
New Accounting Standards for Application in Future
New Accounting Standards for Application in Future
Periods
Periods
Periods
Periods
Accounting Standards issued by the AASB that are not yet
mandatorily applicable to the Group, together with an
such
assessment of
pronouncements on the Group when adopted in future
periods, are discussed below:
the potential
impact of
NOTES TO FINANCIAL
STATEMENTS
Continued
and includes revised requirements for the classification
instruments, revised
financial
and measurement of
recognition and derecognition requirements for financial
instruments and simplified requirements for hedge
accounting.
The consolidated entity will adopt this standard from 1
July 2018 and the impact of its adoption is likely to be
minor.
AASB 15: Revenue from Contracts with Customers
(applicable to annual reporting periods beginning on or
after 1 January 2018, as deferred by AASB 2015-
8: Amendments to Australian Accounting Standards –
Effective Date of AASB 15).
When effective, this Standard will replace the current
accounting requirements applicable to revenue with a
single, principles-based model. Except for a limited
number of exceptions, including leases, the new revenue
model in AASB 15 will apply to all contracts with
customers as well as non-monetary exchanges between
entities in the same line of business to facilitate sales to
customers and potential customers.
The consolidated entity will adopt this standard from 1
July 2018 but the impact of its adoption is yet to be
assessed by the consolidated entity.
AASB 16: Leases (applicable to annual reporting periods
beginning on or after 1 January 2019).
When effective, this Standard will replace the current
accounting requirements applicable to leases in AASB
117: Leases and related Interpretations. AASB 16
introduces a single
lessee accounting model that
eliminates the requirement for leases to be classified as
operating or finance leases.
AASB 9: Financial Instruments and associated Amending
Standards
(applicable to annual reporting periods
beginning on or after 1 January 2018).
The consolidated entity will adopt this standard from 1
July 2018 but the impact of its adoption is yet to be
assessed by the consolidated entity.
The Standard will be applicable retrospectively (subject
to the provisions on hedge accounting outlined below)
Page | 34
NOTES TO FINANCIAL
STATEMENTS
Continued
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
2015
$
2,482,925
1,515,381
10,733
12,652
429,516
13,330
-
442,846
366,831
-
144,562
511,393
Note 3: Revenue and other income
Operating revenue
Operating revenue
Operating revenue
Operating revenue
Sale of goods
Other revenue
Other revenue
Other revenue
Other revenue
Interest received
Other income
Other income
Other income
Other income
Grants receivable – R&D Tax Incentive
Sundry income
Exchange gain
Total other income
from continuing operations
and other income from continuing operations
Total revenues and other income
Total revenues
from continuing operations
from continuing operations
and other income
and other income
Total revenues
Total revenues
2,936,504
2,039,426
Note 4: Expenses from continuing activities, excluding finance
costs
Depreciation and amortisation expenses
Impairment of patents
Employee benefits expense
Research and development expenses
Advertising and marketing expenses
Occupancy expenses
Auditors remuneration (audit and review)
Regulatory expenses
Administrative expenses
Exchange losses
activities, excluding finance costs
continuing activities, excluding finance costs
Total expenses from continuing
Total expenses from
activities, excluding finance costs
activities, excluding finance costs
continuing
continuing
Total expenses from
Total expenses from
278,713
-
1,765,193
542,903
784,493
156,967
66,630
37,164
491,099
8,768
4,131,930
172,019
59,768
992,060
488,178
557,523
154,613
50,000
71,944
367,257
-
2,913,362
Operating lease expenses of $142,215 in 2016 (2015: $138,955) are included in occupancy expenses above.
Share based expenses of $246,286 in 2016 (2015: $168,150) are included in employee benefits expenses above.
Page | 35
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 5: Income tax
Major components of income tax
Major components of income tax
Major components of income tax
Major components of income tax
Current income tax
Income tax
Income tax
Income tax
Income tax
Reconciliation between income tax credit and prima facie tax on accounting
Reconciliation between income tax credit and prima facie tax on accounting
Reconciliation between income tax credit and prima facie tax on accounting
Reconciliation between income tax credit and prima facie tax on accounting
loss
loss
loss
loss
Accounting loss before income tax
Tax benefit at 30% in Australia, 15% in USA, 12% in Hungary (2015: 30% in
Australia)
Tax effect on non-taxable income and non-deductible expenses
Temporary differences
Deferred tax asset not brought to account
Income tax
Income tax
Income tax
Income tax
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
(11,590)
(11,590)
2015
$
-
-
1,903,439
1,215,654
538,596
369,318
(203,386)
(28,508)
(295,112)
(11,590)
(167,151)
(36,909)
(165,258)
-
As at 30 June 2016, the Consolidated Entity had estimated unrecouped operating income tax losses of $18,959,811
(2015: $17,685,151). The benefit of these losses of $5,454,498 (2015: $5,095,594) has not been brought to account as
realisation is not probable. The benefit will only be obtained if:
• The Consolidated Entity derives future assessable income of a nature and an amount sufficient to enable the
benefits from the deductions for the losses to be realised;
• The Consolidated Entity continues to comply with the conditions for deductibility imposed by the law;
• No changes in tax legislation adversely affect the Consolidated Entity in realising the benefit from the deduction
for the losses.
Note 6: Accumulated losses
Accumulated losses at the beginning of the financial year
Net loss attributable to members of the Entity
Accumulated losses at the end of the financial year
Accumulated losses at the end of the financial year
Accumulated losses at the end of the financial year
Accumulated losses at the end of the financial year
Note 7: Earnings per share
Loss after tax used in calculation of basic and diluted EPS
Weighted average number of ordinary shares during the year used in calculation
of basic EPS
Weighted average number of options outstanding
Weighted average number of rights outstanding
Weighted average number of ordinary shares outstanding during the year used in
calculation of diluted EPS
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
(25,618,591)
(1,915,029)
(24,402,937)
(1,215,654)
(27,533,620)
(25,618,591)
(1,915,029)
Number
(1,215,654)
Number
96,118,052
81,647,161
5,630,323
5,859,902
1,944,418
3,483,832
107,608,277
87,075,411
(2.0)
(2.0)
(1.5)
(1.5)
The options and rights in existence have an anti-dilutive effect on EPS, therefore there is no difference between
basic earnings per share and diluted earnings per share as shown above.
Page | 36
NOTES TO FINANCIAL
STATEMENTS
Continued
lidated
Consolidated
Conso
lidated
lidated
Conso
Conso
2016
2016
2016
2016
$
7,672
1,767,777
23,906
1,040,418
2,839,773
2015
$
132
447,026
38,741
40,418
526,317
267,751
267,751
300,753
300,753
Note 8: Cash and cash equivalents
Cash on hand
Bank: Cheque accounts
Bank: Cash management
Bank: Term deposits
Total cash and cash equivalents
Total cash and cash equivalents
Total cash and cash equivalents
Total cash and cash equivalents
Note 9: Trade and other receivables
Current
Current
Current
Current
Trade receivables
Total current receivables
Total current receivables
Total current receivables
Total current receivables
Trade receivables are non-interest bearing and on an average of 45 day terms. Details of trade receivables past due
but not impaired are disclosed in note 21.
Note 10: Inventories
Current inventories at cost
Current inventories at cost
Current inventories at cost
Current inventories at cost
Raw materials
Work in Progress
Finished products
Total inventories
Total inventories
Total inventories
Total inventories
Note 11: Tax asset
R & D tax incentive
Total tax asset
Total tax asset
Total tax asset
Total tax asset
Note 12: Plant and equipment
Plant and equipment at cost
Accumulated depreciation – including foreign exchange impact
Office furniture and equipment at cost
Accumulated depreciation – including foreign exchange impact
Computer software at cost
Accumulated depreciation – including foreign exchange impact
Low value asset pool at cost
Accumulated depreciation – including foreign exchange impact
239,745
61,526
117,436
418,707
162,172
105,340
258,160
525,672
429,516
429,516
366,831
366,831
645,943
(588,089)
57,854
581,315
(542,194)
39,121
71,027
(59,832)
11,195
36,910
(32,337)
4,573
50,314
(49,041)
1,273
59,166
(57,422)
1,744
26,130
(22,881)
3,249
34,619
(32,583)
2,036
Total plant and equipment
Total plant and equipment
Total plant and equipment
Total plant and equipment
74,895
46,150
Page | 37
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 12: Plant and equipment (continued)
Movements in carrying amounts
Movements in carrying amounts
Movements in carrying amounts
Movements in carrying amounts
Useful life
Consolidated Entity
Consolidated Entity
Consolidated Entity
Consolidated Entity
Carrying amount at 1 July 2015
Acquisitions through business combinations
Additions
Disposals
Depreciation expense
Carrying amount at 30 June 2020202016161616
Carrying amount at 30 June
Carrying amount at 30 June
Carrying amount at 30 June
Plant and
equipment
Office
furniture and
equipment
2-7 years
$
2-7 years
$
39,121
38,361
3,831
(363)
(23,095)
57,855
1,744
11,156
800
(365)
(2,140)
11,195
Note 13: Intangible assets
current
NonNonNonNon----current
current
current
Patents at cost
Accumulated amortisation and impairment
Carrying amount at 30 June
Carrying amount at 30 June
Carrying amount at 30 June
Carrying amount at 30 June
Regulatory approvals -acquisitions through business combinations
Accumulated amortisation
Carrying amount at 30 June
Total intangible assets
Total intangible assets
Total intangible assets
Total intangible assets
Movements in carrying amounts
Movements in carrying amounts
Movements in carrying amounts
Movements in carrying amounts
Patents carrying amount at 1 July
Additions
Impairment
Amortisation
arrying amount at 30 June
Patents carrying amount at 30 June
Patents c
arrying amount at 30 June
arrying amount at 30 June
Patents c
Patents c
Regulatory approvals -acquisitions through business combinations
Additions
Impairment
Amortisation
arrying amount at 30 June
Regulatory approvals carrying amount at 30 June
Regulatory approvals c
arrying amount at 30 June
arrying amount at 30 June
Regulatory approvals c
Regulatory approvals c
(i)
27
(ii)
(ii)
Computer
software
Low value
asset pool
3 years
$
3,249
5,611
1,800
(955)
(5,133)
4,572
3 years
$
2,036
-
458
-
(1,221)
1,273
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
2015
2015
2015
2015
$
1,797,260
(778,803)
1,018,457
630,730
(105,122)
525,608
1,544,065
1,065,812
93,647
-
(141,002)
1,018,457
630,730
-
-
(105,122)
525,608
2,037,460
(971,648)
1,065,812
----
----
----
-
1,222,518
60,370
(59,768)
(157,308)
1,065,812
-
-
-
-
-
(i)
(ii)
Patents at costs for 2016 has excluded the patents being written down in the prior years.
Intangible Assets comprise Intellectual Property in the form of Patents and Regulatory approvals (FDA
and CE). Patents and Regulatory approvals have finite useful lives. The current amortisation charge in
respect of Patents and Regulatory approvals is included under Expenses from Continuing Activities in
the Statement of Profit or Loss and Other Comprehensive Income.
Page | 38
Note 14: Other assets
Current
Current
Current
Current
GST/VAT receivable
Prepayments
her current assets
Total other current assets
Total ot
her current assets
her current assets
Total ot
Total ot
Note 15: Trade and other payables
Current
Current
Current
Current
Trade payables
Sundry payables and accrued expenses
Employee related payables
Total payables
Total payables
Total payables
Total payables
Note 16: Provisions
Current
Current
Current
Current
Provision for annual leave
Provision for long service leave
NonNonNonNon----current
current
current
current
Provision for long service leave
Provision for warranties
NOTES TO FINANCIAL
STATEMENTS
Continued
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
2015
2015
2015
2015
$
92,311
44,728
137,039
26,240
78,580
104,820
72,811
418,643
54,445
545,899
179,815
198,888
39,821
418,524
132,693
77,209
209,902
4,354
13,600
17,954
129,837
66,236
196,073
19,797
13,300
33,097
Aggregate employee benefits
(a) Aggregate employee benefits
(a)
Aggregate employee benefits
Aggregate employee benefits
(a)
(a)
214,256
215,870
(b) Movement in employee benefits
(b) Movement in employee benefits
(b) Movement in employee benefits
(b) Movement in employee benefits
Balance at beginning of the year
Additional provision
Amounts used
Balance at end of the year
Balance at end of the year
Balance at end of the year
Balance at end of the year
215,870
143,421
(145,035)
214,256
185,146
99,870
(69,146)
215,870
Page | 39
NOTES TO FINANCIAL
STATEMENTS
Continued
onsolidated
CCCConsolidated
onsolidated
onsolidated
2016
2016
2016
2016
$
2015
2015
2015
2015
$
30,308,877
26,019,429
30,308,877
26,019,429
26,019,429
-
1,450,000
41,250
744
100,000
594,498
29,750
4,463
2,318,925
(250,182)
26,006,168
14,875
-
-
-
-
-
-
-
-
(1,614)
Note 17: Issued capital
Issued capital
Issued capital
Issued capital
Issued capital
Fully paid ordinary shares
Total contributed equity
Total contributed equity
Total contributed equity
Total contributed equity
Movement in issued capital
Movement in issued capital
Movement in issued capital
Movement in issued capital
Shares on issue at the beginning of the year
250,000 ordinary shares issued at 5.95 cents on 30 September 2014
9,666,669 ordinary shares issued at 15 cents on 23 July 2015
275,000 ordinary shares issued at 15 cents on 31 July 2015
12,500 ordinary shares issued at 5.95 cents on 31 July 2015
666,667 ordinary shares issued at 15 cents on 14 August 2015
3,963,319 ordinary shares issued at 15 cents on 21 August 2015
500,000 ordinary shares issued at 5.95 cents on 30 Sep 2015
75,000 ordinary shares issued at 5.95 cents on 23 March 2016
11,594,625 ordinary shares issued at 20 cents on 10 Jun 2016
Share issue costs
at the end of the year
Issued Equity at the end of the year
Issued Equity
at the end of the year
at the end of the year
Issued Equity
Issued Equity
30,308,877
26,019,429
Fully paid ordinary s
hares
Fully paid ordinary shares
hares
hares
Fully paid ordinary s
Fully paid ordinary s
Ordinary shares at the beginning of the year
250,000 ordinary shares issued by exercise of options on 30 September 2014
9,666,669 ordinary shares issued at 15 cents by private placement on 23 July 2015
275,000 ordinary shares issued at 15 cents by private placement on 31 July 2015
12,500 ordinary shares issued at 5.95 cents by exercise of option on 31 July 2015
666,667 ordinary shares issued at 15 cents by private placement on 14 August
2015
3,963,319 ordinary shares issued by private placement on 21 August 2015
500,000 ordinary shares issued by exercise of option on 30 September 2015
75,000 ordinary shares issued by exercise of option on 23 March 2016
11,594,625 ordinary shares issued by private placement on 10 Jun 2016
Number
81,709,490
-
9,666,669
275,000
12,500
666,667
3,963,319
500,000
75,000
11,594,625
Number
81,459,490
250,000
-
-
-
-
-
-
-
-
Total ordinary shares at the end of the year
Total ordinary shares at the end of the year
Total ordinary shares at the end of the year
Total ordinary shares at the end of the year
108,463,270
81,709,490
The Company’s authorised share capital amounted to 108,463,270 ordinary shares of no par value at 30 June 2016.
Fully paid ordinary shares participate in dividends and the proceeds on winding up of the Company in proportion to
the number of shares held. At shareholders meetings, each ordinary share is entitled to one vote when a poll is called,
or via a show of hands.
Page | 40
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 18: Options and rights reserve
The Consolidated Entity has adopted a new Equity Incentive Plan for the benefit of an employee, contractor,
consultant, executive director of the Group or any other person whom the Board determines to be eligible to
participate in the Plans. The Board may impose conditions, including performance related conditions, on the right to
exercise any options and rights granted under the Equity Incentive Plan.
The purpose of the Plan is to:
•
•
•
•
provide Eligible Persons with an incentive plan which recognises ongoing contribution to the achievement
by the Company of its strategic goals thereby encouraging the mutual interdependence of Participants and
the Company;
align the interests of Participants with shareholders of the Company through the sharing of a personal
interest in the future growth and development of the Company as represented in the price of the Company’s
ordinary fully paid shares;
encourage Eligible Persons to improve the performance of the Company and its total return to Shareholders;
and
provide a means of attracting and retaining skilled and experienced employees.
Under the Plan, the Consolidated Entity will be able to grant short-term incentive and long-term incentive awards to
Eligible Employees (including Executive Directors). The Plan will provide the Board with the flexibility to grant equity
incentives to Eligible Persons in the form of Plan Shares, rights or Options, will only vest on the satisfaction of
appropriate hurdles.
Effect of share
based payment transactions
Effect of share----based payment transactions
based payment transactions
based payment transactions
Effect of share
Effect of share
Share
Option Planlanlanlan
Share Option P
Option P
Option P
Share
Share
Options and rights reserve balance at the beginning of the year
Expenses arising from share-based payment transactions
Options and rights reserve balance for Share Option Plan at the end of the year
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
2015
2015
2015
2015
$
1,806,732
293,161
2,099,893
1,638,582
168,150
1,806,732
Movement in options during the financial year
ancial year
Movement during the financial year
Movement during the fin
ancial year
ancial year
Movement during the fin
Movement during the fin
Opening number of options
Granted during the financial year – Consultant
Lapsed during the financial year
Cancelled during the financial year
Exercised during the financial year
Closing number of options
Closing number of options
Closing number of options
Closing number of options
Number of
Options 2016
1,912,500
4,765,544
(650,000)
-
(587,500)
5,440,544
Weighted
average
exercise price
0.06
0.25
0.06
0.06
0.21
Number of
Options 2015
2,100,000
75,000
(12,500)
-
(250,000)
1,912,500
Weighted
average
exercise price
0.06
0.17
0.06
0.06
0.06
Page | 41
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 18: Options and rights reserve (continued)
Details of options outstanding as at end of the year
Holders No.
Grant date
1 (Executive)
1 (Director)
1 (Consultant)
32 (Investors)
1 (Investor)
1 (Investor)
1 (Investor)
Total
Total
Total
Total
29 March 2012
7 November 2012
1 December 2014
23 July 2015
14 August 2015
21 August 2015
27 October 2015
Exercisable
at 30 June
2016
%
100%
100%
67%
100%
100%
100%
100%
Expiry date
29 March 2017
7 November 2016
1 July 2018
31 July 2017
31 July 2017
31 July 2017
31 July 2017
30 June 2016
Outstanding
Option
No.
100,000
500,000
75,000
3,222,211
222,222
888,889
432,222
5,440,544
Exercise
Price
$
0.0595
0.0595
0.1700
0.2500
0.2500
0.2500
0.2500
Issued
date fair
value
$
0.06
0.06
0.20
0.16
0.15
0.15
0.185
The options issued prior to this financial year were issued under the previous employee option plan, have an exercise
price based on 85% of the average ASX closing price for the 5 days prior to offer/acceptance of the options. Each
option is issued for a period of 4 years, which vest 25% in tranches throughout the period.
The options issued on 1 December 2014 were issued under the Equity Incentive plan. The options vest one third each
on the issue day, 1 July 2015 and 1 July 2016 respectively.
Fair value
Fair value
Fair value
Fair value
Fair value was measured using Blackscholes and the inputs to it were as follows:
Weighted average share price Range from $0.06 to $0.25
Exercise price
Option life
Risk-free interest rate
Expected dividends
Expected volatility*
600,000 at $0.0595, 75,000 at $0.17 and 4,765,544 at $0.25
2-4 years
Range from 2.13% to 4.17%
0
Range from 62% to 76%
* Historical volatility has been the basis for determining the expected share price volatility as it is assumed that it is indicative of the future trade, which may not eventuate.
Movement in rights during the financial year
Rights at the beginning of the period
Granted during the period
Rights at the end of the period
2016
2016
2016
2016
Number
5,859,902
-
5,859,902
2015
Number
-
5,859,902
5,859,902
5,409,902 Indeterminate rights were issued to Rob Phillips on the terms and conditions approved by shareholders at the
AGM on 26 November 2014 under the Equity Incentive Plan, vesting dependent on performance hurdles on 1 July 2018,
1 July 2019 & 1 July 2020. Consideration payable upon vesting is $nil. The Board may exercise its discretion to pay cash
in lieu of issue of ordinary shares.
450,000 Performance rights were issued to Nick Schicht on 26 November 2014 under the Equity Incentive Plan, vesting
dependent on performance hurdles on 1 July 2018, 1 July 2019 and 1 July 2020. Consideration payable upon vesting is
$nil.
Note 19: Translation reserve
Opening balance
Translation of financial statements of foreign Controlled Entities
Closing balance
Closing balance
Closing balance
Closing balance
2016
2016
2016
2016
$
81,091
(18,250)
62,841
2015
2015
2015
2015
$
77,580
3,511
81,091
Translation reserve is the movement of assets and liabilities’ value for the foreign subsidiaries due to the fluctuation of
foreign exchange.
Page | 42
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 20: Cash flow information
(a) Reconciliation of cash
Cash at bank and on hand
Total cash at end of year
Total cash at end of year
Total cash at end of year
Total cash at end of year
(b) Reconciliation of cash flow from operations to loss from continuing operations
after income tax
Loss from continuing operations after income tax
Non cash flows in loss from continuing operations
Depreciation
Amortisation
Impairment of patents
Options reserve
Translation reserve
(Increase)/decrease in assets
Trade debtors
Inventories
Prepayments
R & D tax incentive
GST assets
Increase/(decrease) in liabilities
Trade payables
Sundry payables and accrued expenses
Employee related payables
Employee provisions
Other provisions
Net cash used in operating activities
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
2015
2015
2015
2015
$
2,839,773
2,839,773
526,317
526,317
(1,915,029)
(1,215,654)
32,590
246,123
-
246,286
(18,250)
33,002
105,905
33,852
(62,685)
(66,071)
(107,004)
219,756
(37,957)
(1,614)
300
(1,290,796)
14,711
157,308
59,768
168,150
3,511
24,761
(314,513)
(37,332)
(53,781)
2,896
118,307
32,991
10,963
30,724
4,394
(992,796)
Note 21: Financial instruments
(a)
(a)
t accounting policies
Significant accounting policies
Significan
t accounting policies
t accounting policies
Significan
Significan
(a)
(a)
Details of the significant accounting policies and methods adopted, including the criteria of recognition, the basis of
measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset,
financial liability and equity instrument are disclosed in note 2 to the financial statements.
(b) Capital risk management
(b)
Capital risk management
Capital risk management
Capital risk management
(b)
(b)
The Consolidated Entity manages its capital to ensure that companies in the Consolidated Entity are able to continue as
a going concern. The capital structure of the Entity consists of cash and cash equivalents (note 8 on page 37) and equity
attributable to equity holders of the Parent Entity, comprising issued capital (note 17 on page 40), and accumulated
losses (note 6 on page 36).
(c) Outstanding contracts
Outstanding contracts
(c)
(c)(c)
Outstanding contracts
Outstanding contracts
At 30 June 2016, there were no outstanding contracts.
(d) Financial risk management objectives
(d)
Financial risk management objectives
Financial risk management objectives
Financial risk management objectives
(d)
(d)
The Consolidated Entity’s principal financial instruments are cash and term deposit accounts. Its financial instruments
risk is with interest rate risk on its cash and term deposits and liquidity risk for its term deposits.
The Consolidated Entity does not enter into or trade financial instruments, including derivative financial instruments, for
speculative purposes. The Board is updated monthly by management as to the amounts of funds available to the
Consolidated Entity from either cash in the bank or term deposits, and continually monitors interest rate movements.
Page | 43
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 21: Financial instruments (continued)
(e) Foreign currency risk managemen
Foreign currency risk managementttt
(e)
Foreign currency risk managemen
Foreign currency risk managemen
(e)
(e)
The Consolidated Entity undertakes certain transactions denominated in foreign currencies, hence exposures to
exchange rate fluctuations arise. The Consolidated Entity does not have any forward foreign exchange contracts as at
30 June 2016 and is exposed to foreign currency risk on sales and purchases denominated in a currency other than
Australian dollars.
The currencies giving rise to this risk is primarily the US Dollar, Euro and British Pound. The Consolidated Entity incurs
costs in US Dollars for its operations which provide a natural hedge for a portion of income denominated in US Dollars.
The carrying amount of the Consolidated Entity’s foreign currency denominated monetary assets and monetary liabilities
at the reporting date is as follows:
Cash
Current trade debtors
Current trade creditors
Cash
Current trade debtors
Current trade debtors
nsolidated
CoCoCoConsolidated
nsolidated
nsolidated
2016
2016
2016
2016
US$
656,326
199,456
20,707
€
94,253
-
£
-
2015
2015
2015
2015
US$
156,591
216,605
75,467
€
87,791
12,850
£
-
Foreign currency sensitivity
Foreign currency sensitivity
Foreign currency sensitivity
Foreign currency sensitivity
(f)(f)(f)(f)
The Consolidated Entity is mainly exposed to exchange rate risks arising from movements in the US Dollar, Euro and
British Pound against the Australian Dollar, and the US Dollar from the translation of the operations of its Controlled
Entity.
The analysis below demonstrates the profit impact of a 10% movement of US Dollar and a 5% movement of Euro and
British Pound rates against the Australian Dollar with all other variables held constant. 10% and 5% are the sensitivity
rates used when reporting foreign currency risk internally to key management personnel and represents management’s
assessment of the possible change in foreign exchange rates.
Profit/Loss - increase 10% (US$) and 5% (€) & (£)
- decrease 10% (US$) and 5% (€) & (£)
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
(205,126)
205,126
2015
2015
2015
2015
$
(138,891)
138,891
Interest rate risk management
Interest rate risk management
Interest rate risk management
Interest rate risk management
(g)
(g)
(g)
(g)
The Consolidated Entity does not have any external loans or borrowings as at 30 June 2016 and is not exposed to interest
rate risks related to debt.
The Consolidated Entity is exposed to interest rate risk as companies in the Consolidated Entity hold cash and term
deposits at both fixed and floating interest rates. The risk is managed by the Consolidated Entity maintaining an
appropriate mix between both rates.
Management continually monitors its cash requirements through forecasts and cash flow projections and moves funds
between fixed and variable interest instruments to hold the maximum amount possible in instruments which pay the
greater rate of interest. This limits the amount of risk associated with setting a policy on the mix of funds to be held in
fixed or variable interest rate instruments.
Page | 44
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 21: Financial instruments (continued)
(h)
(h)
(h)
(h)
A 100 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel
and represents management’s assessment of the possible change in interest rates.
Interest rate sensitivity
Interest rate sensitivity
Interest rate sensitivity
Interest rate sensitivity
Profit/Loss - increase 100 basis points
- decrease 100 basis points
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
1,072
(1,072)
2015
2015
2015
2015
$
1,265
(1,265)
Credit risk management
Credit risk management
Credit risk management
Credit risk management
(i)(i)(i)(i)
Credit risk represents the loss that would be recognised if counterparties defaulted on its contractual obligations. The
Consolidated Entity’s exposure and the credit ratings of its counterparties are continuously monitored and the aggregate
value of transactions concluded is spread among approved counterparties. Credit exposure is controlled by counterparty
limits that are reviewed and approved by the management annually. Ongoing credit evaluation is also performed on the
financial condition of accounts receivable.
The Consolidated Entity does not have significant credit risk exposure to any single counterparty or any group of
counterparties having similar characteristics; because the current major counterparties are alliance distributors and public
hospitals with approved funds available prior to purchases under most circumstances.
The credit risk on financial assets of the Consolidated Entity, as recognised on the Statement of Financial Position, is the
carrying amount, net of any allowance for doubtful debts. Credit risk in respect of cash and deposits is minimised as
counterparties are recognised financial intermediaries with acceptable credit ratings determined by a recognised rating
agency.
Debtors past due but not impaired
0 - 45 days
46 – 90 days
Over 90 days
Total
Total
Total
Total
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
16,592
-
18,736
35,328
2015
2015
2015
2015
$
-
-
9,685
9,685
No bad debt was written off during the year (2015: $Nil). There was no doubtful debt provision as at 30 June 2016 (2015:
Nil). The past due debts of $35,328 from two debtors is still outstanding subsequent to the reporting date, but full
recovery is expected based on communication with the debtor.
Liquidity risk management
Liquidity risk management
Liquidity risk management
Liquidity risk management
(j)(j)(j)(j)
The objective for managing liquidity risk is to ensure the business has sufficient working capital or access to working
capital as and when required. The Consolidated Entity limits its exposure to liquidity risk by holding the majority of its
assets in cash or term deposits which can be quickly converted to cash if required.
The carrying amounts of financial assets and financial liabilities recorded at cost approximate their fair values.
The following table details the Consolidated Entity’s remaining contractual maturity for its non-derivative financial assets
and liabilities. The table has been drawn up based on the undiscounted cash flows expected to be received/paid by the
Consolidated Entity.
Page | 45
2016
2016
2016
2016
Financial assets
Cash
Trade receivables
Other receivables
Total financial assets
Financial liabilities
Trade creditors
Payables
Total financial liabilities
Net financial assets
Net financial assets
Net financial assets
Net financial assets
Consolidated
Consolidated
Consolidated
Consolidated
2015
2015
2015
2015
Financial assets
Cash
Trade receivables
Other receivables
Total financial assets
Financial liabilities
Trade creditors
Sundry payables
Total financial liabilities
Net financial assets
Net financial assets
Net financial assets
Net financial assets
Note 21: Financial instruments (continued)
Consolidated
Consolidated
Consolidated
Consolidated
Weighted
Average
effective interest
Rate %
1.3
-
NOTES TO FINANCIAL
STATEMENTS
Continued
Fixed interest rate maturing
Floating
interest
$
Within 1
year
$
1 to 5
years
$
Non-interest
bearing
$
Total
$
718,349
-
-
1,040,418
-
-
718,349
1,040,418
-
-
-
-
-
-
718,349
1,040,418
-
-
-
-
-
-
-
-
1,081,006
267,751
92,311
2,839,773
267,751
92,311
1,441,068
3,199,835
72,811
54,445
72,811
54,445
127,256
127,256
1,313,812
3,072,579
Weighted
Average
effective
interest
Rate %
Fixed interest rate maturing
Floating
interest
Within 1
year
$
$
1 to 5
years
$
0.5
-
485,899
-
-
485,899
40,418
-
-
40,418
-
-
-
-
-
-
485,899
40,418
-
-
-
-
-
-
-
-
Non-
interest
bearing
$
-
300,753
26,240
326,993
179,815
39,821
219,636
Total
$
526,317
300,753
26,240
853,310
179,815
39,821
219,636
107,357
633,674
2016
$
3,072,579
429,516
418,707
44,728
74,895
1,544,065
(418,643)
(227,856)
2015
$
633,674
366,831
525,672
78,580
46,150
1,065,812
(198,888)
(229,170)
4,937,991
2,288,661
Reconciliation of net financial assets to net assets
Reconciliation of net financial assets to net assets
Reconciliation of net financial assets to net assets
Reconciliation of net financial assets to net assets
Net financial assets as above
Non-financial assets and liabilities
R & D tax incentive receivable
Inventories
Prepayments
Plant and equipment
Intangible assets
Accruals
Provisions
Statement of Financial Position
Net assets per Statement of Financial Position
Net assets per
Statement of Financial Position
Statement of Financial Position
Net assets per
Net assets per
The carrying amounts of the consolidated entity’s financial assets and financial liabilities are assumed to approximate
their fair values due to their short-term nature.
Page | 46
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 22: Related party disclosures
Transactions between related parties are on normal commercial terms and conditions, no more favourable than those
available to other parties unless otherwise stated.
Parent
and Controlled Entityntityntityntity
Parent and Controlled E
Parent
and Controlled E
and Controlled E
Parent
Parent Entity
Parent Entity
Parent Entity
Parent Entity
Significant investments in subsidiaries:
Country of subsidiary incorporation:
Proportion of ownership interest:
Uscom, Inc.
U.S.A
100%
Significant investments in subsidiaries:
Country of subsidiary incorporation:
Proportion of ownership interest:
Uscom Medical Ltd
U.K.
100%
Significant investments in subsidiaries:
Country of subsidiary incorporation:
Proportion of ownership interest:
Thor Laboratories KFT.
Hungary
100%
Consolidated
Consolidated
Consolidated
Consolidated
The Parent and Ultimate Parent Entity is Uscom Limited.
Key manag
ement personnel
Key management personnel
ement personnel
ement personnel
Key manag
Key manag
The following were key management personnel of the Consolidated Entity at any time during the reporting period
and unless otherwise indicated were key management personnel for the entire period:
NonNonNonNon----Executive Directors
Executive Directors
Executive Directors
Executive Directors
Sheena Jack, Non-Executive Director
Christian Bernecker, Non-Executive Director
Chao Xiao He, Non-Executive Director since 23 March 2016
Executive Directors
Executive Directors
Executive Directors
Executive Directors
Rob Phillips, Executive Director, Chairman, Chief Executive Officer
Senior Executives
Senior Executives
Senior Executives
Senior Executives
Nick Schicht, General Manager
For further remuneration information of key management personnel refer to the remuneration report in the Directors’
report on pages 20-22.
The aggregate compensation made to Directors and other members of key management personnel of the Company
and the Consolidated Entity is set out below:
Short-term employee benefits
Post-employment benefits
Other payments
Share-based payment
remuneration
Total key management personnel remuneration
Total key management personnel
remuneration
remuneration
Total key management personnel
Total key management personnel
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
525,325
63,785
-
254,940
844,050
2015
2015
2015
2015
$
409,325
37,145
20,000
160,053
626,523
Page | 47
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 23: Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of comprehensive income
Statement of comprehensive income
Statement of comprehensive income
Statement of comprehensive income
Loss after income tax
Total comprehensive income
Statement of financial position
Statement of financial position
Statement of financial position
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Equity
Equity
Equity
Contributed equity
Options reserve
Accumulated losses
Total equity
Parent
Parent
Parent
Parent
2016
2016
2016
2016
$
2015
2015
2015
2015
$
(1,831,167)
(1,831,167)
(1,246,463)
(1,246,463)
3,828,705
5,541,184
660,407
678,361
1,785,997
2,751,433
606,955
640,052
30,308,877
2,099,893
(27,545,947)
4,862,823
26,019,429
1,806,732
(25,714,780)
2,111,381
Contingent liabilities
Contingent liabilities
Contingent liabilities
Contingent liabilities
The parent entity has provided a guarantee in respect of obligations under premises lease of $40,418 (2015: $40,418).
No liability was recognised by the parent entity or the consolidated entity in relation to this guarantee.
Other than the guarantee mentioned above, the parent entity did not have any contingent liabilities as at 30 June
2016 or 30 June 2015.
Significant accounting policies
Significant accounting policies
Significant accounting policies
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in note
2.
Consolidated
Consolidated
Consolidated
Consolidated
2016
2016
2016
2016
$
2015
2015
2015
2015
$
139,607
71,321
210,928
67,334
-
67,334
56,500
10,130
66,630
2,000
-
2,501
1,395
5,896
50,000
-
50,000
1,000
1,250
-
-
2,250
72,526
52,250
Note 24: Commitments
Operating
lease commitments
Operating lease commitments
lease commitments
lease commitments
Operating
Operating
Operating commitments represent payments due for office rentals and have an
average term from 18 to 30 months and month to month thereafter.
Less than 1 year
Between 1 and 5 years
Total operating commitmentstststs
Total operating commitmen
Total operating commitmen
Total operating commitmen
Note 25: Auditors’ remuneration
a. Audit services
Audit services
Audit services
Audit services
of financial reportssss
and review of financial report
Audit and review
BDO East Coast Partnership for Audit
BDO East Coast Partnership for
of financial report
of financial report
and review
and review
Audit
Audit
BDO East Coast Partnership for
BDO East Coast Partnership for
BDO Hungary Audit and review of financial reports
Total remuneration for audit services
Total remuneration for audit services
Total remuneration for audit services
Total remuneration for audit services
b. NonNonNonNon----audit services
audit services
audit services
audit services
Accounting advice
BDO East Coast Partnership for Accounting advice
BDO East Coast Partnership for
Accounting advice
Accounting advice
BDO East Coast Partnership for
BDO East Coast Partnership for
BDO East Coast Partnership for Taxation advice
BDO Hungary for Due diligence service
BDO Hungary for Taxation advice
audit services
for Non----audit services
Total remunerationononon for Non
Total remunerati
audit services
audit services
for Non
for Non
Total remunerati
Total remunerati
Total auditors’ remuneration
Total auditors’ remuneration
Total auditors’ remuneration
Total auditors’ remuneration
Page | 48
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 26: Operating segments
Segment information
The Consolidated Entity operates in the global health and medical products
The Consolidated Entity operates in the global health and medical products
The Consolidated Entity operates in the global health and medical products
The Consolidated Entity operates in the global health and medical products
industry.
industry.
industry.
industry.
A cardiac output monitor and the
sells two cardiovascular products, the USCOM 1111A cardiac output monitor and the
The Consolidated Entity sells two cardiovascular products, the USCOM
The Consolidated Entity
A cardiac output monitor and the
A cardiac output monitor and the
sells two cardiovascular products, the USCOM
sells two cardiovascular products, the USCOM
The Consolidated Entity
The Consolidated Entity
Uscom BP+ c
Uscom SpiroSonic
entral blood pressure monitor and a series of pulmonary products the Uscom SpiroSonic
Uscom BP+ central blood pressure monitor and a series of pulmonary products the
Uscom SpiroSonic
Uscom SpiroSonic
entral blood pressure monitor and a series of pulmonary products the
entral blood pressure monitor and a series of pulmonary products the
Uscom BP+ c
Uscom BP+ c
spirometers....
spirometers
spirometers
spirometers
Globally the Company has five geographic sales and distribution segments Australia, Asia, the Americas, Europe and
Mid East and Africa, and other regions. For each segment, the CEO and General Manager review internal
management reports on at least a monthly basis.
The largest customer group operates in Asia and accounts for 47% of the total sales. For the current period Uscom
1A comprised 76%, SpiroSonic spirometers 21% and BP+ 3% of the total Uscom sales revenue.
Basis of accounting for purposes of reporting by operating segments
Basis of accounting for purposes of reporting by operating segments
Basis of accounting for purposes of reporting by operating segments
Basis of accounting for purposes of reporting by operating segments
Accounting policies
Segment information is prepared in conformity with the accounting policies of the entity as disclosed in note 2 and
accounting standard AASB 8 Operating Segments which requires a ‘Management approach’ under which segment
information is presented on the same basis as that used for internal reporting purposes. This has resulted in no
change to the reportable segments as operating segments continue to be reported in a manner consistent with the
internal reporting provided to the chief operating decision maker, which is the Board of Directors.
Segment revenues, expenses, assets and liabilities are those that are directly attributable to a segment. Segment
assets include all assets used by a segment and consist primarily of inventories, property, plant and equipment and
intangible assets. While most of these assets can be directly attributable to individual segments, the carrying amounts
of certain assets used jointly by segments are not allocated. Segment liabilities consist primarily of trade and other
creditors, employee benefits and provisions for warranties. Segment assets and liabilities do not include deferred
income taxes.
Australia
Australia
Australia
Australia
AsiaAsiaAsiaAsia
Americas
Americas
Americas
Americas
Europe
Europe
Europe
Europe
$
$
$
$
Other
Other
Other
Other
regions
regions
regions
regions
$
Consolidated
Consolidated
Consolidated
Consolidated
$
35,768
440,239
1,271,234
-
466,389
-
428,350
13,340
281,184
-
2,482,925
453,579
476,007
3,014,003
(2,537,996)
1,271,234
355,941
915,293
466,389
649,810
(183,421)
441,690
710,858
(269,168)
(11,590)
281,184
109,331
171,853
2016
2016
2016
2016
Sales to external customers
Other income
Total segment
revenue/income
Segment expenses
Segment result
Income tax
Consolidated loss from
ordinary activities after income
tax
Segment assets
Segment liabilities
4,338,477
678,361
125,411
-
542,804
10,373
705,054
85,021
Acquisition of property,
plant and equipment and
intangibles
Impairment of patents
Depreciation and
amortisation
16,881
-
1,199
-
51,550
-
716,763
-
27,904
18,684
32,895
199,230
-
-
-
-
-
Page | 49
2,936,504
4,839,943
(1,903,439)
(11,590)
(1,915,029)
5,711,746
773,755
786,393
-
278,713
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 26: Operating segments (continued)
Australia
Australia
Australia
Australia
AsiaAsiaAsiaAsia
Americas
Americas
Americas
Americas
Europe
Europe
Europe
Europe
$
$
$
$
37,234
524,045
561,279
2,199,629
(1,638,350)
952,429
-
952,429
234,915
717,514
27,491
-
27,491
502,072
(474,581)
410,635
-
410,635
294,573
116,062
Other
Other
Other
Other
regions
regions
regions
regions
$
87,592
-
87,592
23,891
63,701
2015
2015
2015
2015
Sales to external customers
Other income
Total segment revenues/income
Segment expenses
Segment result
Consolidated loss from ordinary
activities after income tax
Segment assets
Segment liabilities
1,781,216
640,052
141,229
-
434,569
7,642
579,341
-
Acquisition of property,
plant and equipment and
intangibles
Impairment of patents
Depreciation and
amortisation
30,228
5,355
4,265
-
30,483
13,109
17,716
41,304
28,252
20,149
34,803
88,322
-
-
-
-
-
Consolidated
Consolidated
Consolidated
Consolidated
$
1,515,381
524,045
2,039,426
3,255,080
(1,215,654)
(1,215,654)
2,936,355
647,694
82,692
59,768
171,526
Note 27: Business combination
On 1 September 2015 Uscom Medical Limited, a subsidiary of Uscom Limited, acquired 100% of the ordinary shares of
Thor Laboratories for the total consideration of $879,106. Thor is a medical device business based in Hungary. It was
acquired to expand and diversify the existing business and leverage the existing distribution channels. The acquired
business contributed revenues of $527,661 and loss after tax of $50,435 to the consolidated entity for the period from 1
September 2015 to 30 June 2016.
Details of the acquisition are as follows:
Cash and cash equivalents
Trade receivables
Inventory
Prepaid Tax
Prepayments
Plant and equipment
Trade payables
Net assets acquired
Intangible assets – Regulatory approvals
Acquisition-date fair value of the total consideration
Representing:
Cash paid
Contingent payable to vendor
Equity based contingent consideration
Cash used to acquire business, net of cash acquired:
Cash paid
Less: cash and cash equivalents
Net cash used
Page | 50
$$$$
108,676
12,949
95,154
32,367
1,383
59,073
(61,226)
248,376
630,730
879,106
700,000
132,231
46,875
879,106
700,000
(108,676)
591,324
NOTES TO FINANCIAL
STATEMENTS
Continued
Note 27: Business combination (continued)
If the consolidated entity acquired the business on 1 July 2015, the business would have contributed revenues of $527,661
and loss after tax of $50,435 to the consolidated entity for the period from 1 July 2015 to 30 June 2016.
Deferred consideration payable for
acquisition
the acquisition
Deferred consideration payable for the
Deferred consideration payable for
acquisition
acquisition
the
the
Deferred consideration payable for
The consolidated entity recognises the fair value of deferred considerations for the acquisition, as of its acquisition date
as part of the consideration transferred in exchange for the acquired business. The fair value measurements require,
among other things, significant estimation of post-acquisition financial performance of the acquired business. This
calculation uses cash flow projection for post-acquisition performance.
Any projected earnout payments are discounted to present value, using a discount rate deemed appropriate by the
consolidated entity to account for the time value of money in addition to the inherent risk in the earnout calculation
projection. The discount rate used is 10% pre-tax.
Contingent consideration classified as an asset or liability is remeasured in each reporting period to fair value,
recognising any change to fair value in profit or loss, unless the change in value can be identified as existing at acquisition
date.
Note 28: Contingencies
Other than the guarantee mentioned at Note 23, the consolidated entity did not have any contingent liabilities as at 30
June 2016 or 30 June 2015.
Note 29: Events after the reporting date
No matters or circumstances have arisen since the end of the financial year to the date of this report, that has significantly
affected or may significantly affect the activities of the consolidated entity, the results of those activities or the state of
affairs of the consolidated entity in the ensuing or any subsequent financial year.
Page | 51
DIRECTORS DECLARATION
Uscom Limited and its Controlled Entity
1. The directors of the company declare that: The financial statements, comprising the statement of comprehensive
income, statement of financial position, statement of cash flows, statement of changes in equity, accompanying
notes, are in accordance with the Corporations Act 2001 and:
a. comply with Accounting Standards and the Corporations Regulations 2001; and
b. give a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and of its
performance for the year ended on that date.
2. The company has included in the notes to the financial statements an explicit and unreserved statement of
compliance with International Financial Reporting Standards.
3.
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.
4. The directors have been given the declarations required by section 295A.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of
the directors by:
Associate Professor Rob Phillips
Ms Sheena Jack
Executive Director - Chairman
Non-Executive Director
Sydney, 17 August 2016
Page | 52
INDEPENDENT AUDIT REPORT
Tel: +61 2 9251 4100
Fax: +61 2 9240 9821
www.bdo.com.au
Level 11, 1 Margaret St
Sydney NSW 2000
Australia
INDEPENDENT AUDITOR’S REPORT
To the members of Uscom Limited
Report on the Financial Report
We have audited the accompanying financial report of Uscom Limited, which comprises the statement
of financial position as at 30 June 2016, the statement of profit or loss and other comprehensive
income, the statement of changes in equity and the statement of cash flows for the year then ended,
notes comprising a summary of significant accounting policies and other explanatory information, and
the directors’ declaration of the consolidated entity comprising the company and the entities it
controlled at the year’s end or from time to time during the financial year.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error. In Note 2, the directors also state, in accordance with Accounting Standard AASB 101
Presentation of Financial Statements, that the financial statements comply with International
Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. Those standards require that we comply with
relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement of the financial report, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the company’s
preparation of the financial report that gives a true and fair view 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 company’s internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by the directors, as
well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
BDO East Coast Partnership ABN 83 236 985 726 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd
ABN 77 050 110 275, an Australian company limited by guarantee. BDO East Coast Partnership and BDO (Australia) Ltd are members of BDO International
Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme
approved under Professional Standards Legislation, other than for the acts or omissions of financial services licensees.
Page | 53
INDEPENDENT AUDIT REPORT
Continued
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations
Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, which
has been given to the directors of Uscom Limited, would be in the same terms if given to the directors
as at the time of this auditor’s report.
Opinion
In our opinion:
(a) the financial report of Uscom Limited is in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the company’s financial position as at 30 June 2016
and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b) the financial report also complies with International Financial Reporting Standards as disclosed in
Note 2.
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June
2016. 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.
Opinion
In our opinion, the Remuneration Report of Uscom Limited for the year ended 30 June 2016 complies
with section 300A of the Corporations Act 2001.
BDO East Coast Partnership
Gareth Few
Partner
Sydney, 17 August 2016
Page | 54
SHAREHOLDER INFORMATION
Additional information required by Australian Stock Exchange Listing Rules is as follows. This information is
current as at 31 July 2016.
(a) Distribution Schedules of Shareholder
(a)
Distribution Schedules of Shareholder
(a)
Distribution Schedules of Shareholder
Distribution Schedules of Shareholder
(a)
Holdings Ranges
Holdings Ranges
Holdings Ranges
Holdings Ranges
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – 99,999,999,999
Total
Total
Total
Total
Holders
Holders
Holders
Holders
Number
108
195
83
280
132
798
Ordinary shares
Ordinary shares
Ordinary shares
Ordinary shares
Number
69,763
580,662
682,007
11,642,102
95,488,736
108,463,270
%
0.06%
0.54%
0.63%
10.73%
88.04%
100%
There were 133 holders of less than a marketable parcel of 105,602 ordinary shares.
(b) Class of shares and voting rights
(b)
Class of shares and voting rights
(b)
Class of shares and voting rights
Class of shares and voting rights
(b)
All shares are ordinary shares. Each ordinary share is entitled to one vote when a poll is called, otherwise each
member present at a meeting or by proxy has one vote on a show of hands.
Substantial shareholders
Substantial shareholders
Substantial shareholders
Substantial shareholders
(c)
(c)
(c)(c)
The names of the substantial shareholders listed in the holding company’s register as at 31 July 2016 are:
DR ROBERT ALLAN PHILLIPS
DR STEPHEN FREDERICK WOODFORD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
DONGJUN SUN
17,580,066
10,268,475
6,266,609
3,500,366
2,414,125
(d)
(d)
(d)
(d)
ordinary shares
Twenty largest registered holders –––– ordinary shares
Twenty largest registered holders
ordinary shares
ordinary shares
Twenty largest registered holders
Twenty largest registered holders
Balance as at 31 July 2016
Balance as at 31 July 2016
Balance as at 31 July 2016
Balance as at 31 July 2016
DR ROBERT ALLAN PHILLIPS
DR STEPHEN FREDERICK WOODFORD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
DONGJUN SUN
DRP CARTONS (NSW) PTY LTD
MR JOHN LIONEL GLEESON
BELL POTTER NOMINEES LTD
INVIA CUSTODIAN PTY LIMITED
MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED
CHESAPEAKE CAPITAL LTD
CORF CORPORATION PTY LIMITED
J P MORGAN NOMINEES AUSTRALIA LIMITED
RAEWYN JANETTE LOVETT & STRUAN GRANT MCOMISH
LINK TRADERS (AUST) PTY LTD
EASTBOURNE ROAD PTY LTD
QUERION PTY LTD PO BOX 1324
MR FREDRIK HOLGER UDEN
MR DAVID LEROY BOYLES
INVIA CUSTODIAN PTY LIMITED
Ordinary
Ordinary
Ordinary
Ordinary
shares
shares
shares
shares
Number
17,580,066
10,268,475
6,266,609
3,500,366
2,414,125
2,359,616
2,351,680
2,116,636
2,088,118
2,014,982
2,000,000
1,920,000
1,792,029
1,477,640
1,220,809
1,187,995
1,166,667
1,120,948
1,000,000
991,667
%
16.208%
9.467%
5.778%
3.227%
2.226%
2.175%
2.168%
1.951%
1.925%
1.858%
1.844%
1.770%
1.652%
1.362%
1.126%
1.095%
1.076%
1.033%
0.922%
0.914%
Total
Total
Total
Total
64,838,428
59.779%
Page | 55
SHAREHOLDER INFORMATION
Continued
Registered office and principal place of office
Level 7, 10 Loftus Street
Sydney NSW 2000 Australia
Tel:
Fax:
02 9247 4144
02 9247 8157
Company Secretary
Brett Crowley
Registers of securities
Boardroom Pty Limited
Level 12, 225 George Street
Sydney NSW 2000 Australia
GPO Box 3993
Sydney NSW 2001 Australia
1300 737 760
Tel:
Fax:
1300 653 459
www.boardroomlimited.com.au
Stock exchange listing
Quotation has been granted for 108,463,270 ordinary shares of the Company as at 31 July 2016 on all Member
Exchanges of the Australian Stock Exchange Limited.
Unquoted securities
Options
as at 31 July 2016
over unissued shares as at 31 July 2016
and rights over unissued shares
Options and rights
as at 31 July 2016
as at 31 July 2016
over unissued shares
over unissued shares
and rights
and rights
Options
Options
A total of 5,440,544 options over ordinary shares are on issue. 500,000 options are on issue to a director. 100,000
options are on issue to an executive under the previous Uscom Executive Share Option Plan; 75,000 options are
on issue to a consultant under the new Equity Incentive Plan. 4,765,544 options are on issue to investors.
A total of 5,859,902 rights over ordinary shares are on issue. 5,409,902 rights are on issue to a director and 450,000
are on issue to an executive under the new Equity Incentive Plan.
Page | 56
Uscom Limited,
Suite 1, Level 7, 10 Loftus Street,
Sydney NSW 2000
Australia
E: info@uscom.com.au
USCOM LIMITED ANNUAL REPORT 2016