Annual Report 2021
Motivated by Vision, Driven by Fundamentals
CONTENTS
CHAIRMAN’S LETTER .................................................................................................................................. 1-16
ASX ANNOUNCEMENTS FY 2021 ..................................................................................................... 17-18
DIRECTORS REPORT ......................................................................................................................... 19-25
FINANCIAL REPORT .......................................................................................................................... 26-47
AUDITORS INDEPENDENCE DECLARATION ........................................................................................... 27
STATEMENT OF PROFIT AND LOSS & OTHER COMPREHENSIVE INCOME ....................................... 28
STATEMENT OF FINANCIAL POSITION .................................................................................................... 29
STATEMENT OF CHANGES IN EQUITY ..................................................................................................... 30
STATEMENT OF CASH FLOWS .................................................................................................................. 31
NOTES TO FINANCIAL STATEMENTS ................................................................................................. 32- 47
DIRECTORS DECLARATION ................................................................................................................... 48
INDEPENDENT AUDIT REPORT ........................................................................................................ 49- 52
SHAREHOLDER INFORMATION ....................................................................................................... 53- 54
ANNUAL REPORT 2021
USCOM LIMITED
CHAIRMAN’S LETTER
P a g e | 1
Motivated by Vision,
Driven by Fundamentals
FY2021
FY2022
• Operating Cash Flow
Positive
• Growth in Sales, Revenue,
and Receipts
• China Profitable
• Europe Profitable
• Cash on Hand
• Multiple New Approvals
• New Products and IP
• New distribution
• Expanded regions
•
Post-COVID Applications
• Global Recovery
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
P a g e | 2
Dear Uscom Partners,
I am pleased to report continued strong growth for FY21 and our first operating cash flow positive year, a recognised inflection
point for medical technology companies. Uscom also recorded our first annual total cash receipts in excess of $5m, despite the
impact of the global pandemic and ongoing global trade wars. Both China and Europe were profitable for FY21, and we have
cash on hand and remain debt free. These results complete a 549% growth in total cash receipts over the prior nine trading years,
at a compound annual growth rate of 23%. We are proud of these results; results that are “motivated by vision, and driven by
fundamentals”. Our mission is to convert world leading science into life saving devices, and to create a powerful and enduringly
profitable global health technology leader for the benefit of society and investors. Uscom’s results for FY21 marked significant
milestones on the path to achieving these objectives.
Our significant FY21 growth was achieved despite intermittent shutdowns and an unpredictable global trading environment.
While COVID proved the clinical value of our USCOM 1A and SpiroSonic technologies, for most of the year the US market was
effectively inaccessible, and in Europe our Budapest operations were intermittently in complete lockdown. Although we adapted
well, thanks to the flexibility of our global team, these conditions curtailed our annual results. Despite these challenges China
again reported profitability for its second consecutive year since establishment, and Hungary reported its first profitable year
since incorporation in 2005.
In addition to our commercial success, we continued investing in global expansion, growing our web of subsidiaries in Singapore,
Beijing, Budapest and Los Angeles, and expanding our networks of distributors in all major markets and positioning operations
for the post-COVID recovery. This investment in infrastructure is necessary to support Uscom’s current growth expectations in
China, Europe, SE Asia and the US. This expansion is also essential preparation to manage the raft of product approvals which
will more than double our product regions for sale over the next year, and are anticipated to begin significantly contributing to
revenue almost immediately. Our FY22 strategy is now a simple one founded on pure business fundamentals; “more products,
more distribution, more sales and more revenue”.
The Uscom foundations - Uscom is now a truly global organisation with 35 fulltime employees worldwide, covering 4 continents
and 4 subsidiaries, crossing different cultures, languages, laws, and commercial and medical environments. This foundation is the
platform on which we are building our regional distribution networks to create a powerful commercial enterprise. Currently this
expanding global distribution is approaching 100 Uscom sales personnel that we are inducting and training on our technologies
to sell in FY22 as new approvals are received. This expanding distribution network is central to our “more products, more
distribution, more sales and more revenue” strategy. While establishing this new global model creates unique management
challenges, particularly in the era of the pandemic, it is an essential next step to ensure sustained incremental revenue growth.
In May we received our Chinese NMPA approval for sale of the patented Uscom BP+ central BP monitor, and Uscom China are
currently preparing marketing materials for its commercial release. China is one of the world’s largest hypertension and vascular
health markets, and the release of the BP+ will provide Uscom’s advanced BP monitoring technology to the patients and clinicians
of China.
In June we received CE Mark for the SpiroSonic AIR allowing us to sell this newest Uscom product into the European market.
Many European, Middle Eastern and SE Asian countries rely on CE approval for regulatory registration of medical products in
their jurisdiction, so this approval provides much wider market access than for Europe alone.
In early July Uscom also received Russian Certification for the sale of USCOM 1A in Russia following a 3-year period of review and
evaluation. Russia is the largest country in Europe with ~150m population and is an increasingly sophisticated medical market.
We continue to work with our distribution partner, Wondermed, and look forward to increased sales and revenue from their
activities.
The SpiroSonic AIR FDA application is currently being finalised for US regulatory approval and is expected within the next 6
months, while the China NMPA approval for the AIR is also nearing completion and is expected before the end of FY22.
Regulatory approvals worldwide are becoming increasingly valuable as the demands of regulations become entwined with trade
protection, making the process more expensive, less predictable and more time consuming. Many of Uscom’s activities are
directed to manage regulatory registration followed by maintenance of regulatory compliance; both processes are incredibly
expensive and a load on Uscom’s balance sheet.
After such a long period or regulatory preparation and review, this rush of regulatory approvals provides Uscom’s newest products
with access to the world’s major markets, and we are looking forward to our current distributors and new distributors to grow
sales across the growing range of Uscom’s cardiovascular and pulmonary products.
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
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USCOM 1A Milestone – 1500 units globally!
Uscom reached a truly significant milestone this year with the manufacture of its 1500th USCOM 1A. This was the result of an
increasing recognition of the clinical value of the USCOM 1A and a continued increasing worldwide sales as established markets
continue to grow, and new markets are developed. In excess of 400 peer reviewed publications and presentations confirm that
the USCOM 1A has become a standard of care for management and diagnosis of cardiovascular disease and guidance of
cardiovascular therapy. The USCOM 1A is used in many of the largest and most prestigious medical institutions around the world,
through to the small regional centres where sole practitioners work daily to save the lives of acutely ill neonates, children and
adults with second-to-second critical clinical decision making.
The USCOM 1A is being established as the technology of choice in ICU’s, ED’s, anaesthetic and paediatric departments the world
over, and is the new standard of care for management of preeclampsia in pregnancy. Every USCOM 1A manufactured and sold
worldwide changes the lives of patients. Devices that change global medical care and whose technology endures are rare;
USCOM 1A is one of these. Everyone connected with Uscom, including founders, past and present staff, researchers, users and
investors should all be proud of how we have saved lives and changed medical practice.
Uscom’s longer term achievements remain excellent with total cash receipts topping 549% growth over the last 9 years with an
accompanying CAGR of 23%, as we established 4 international subsidiaries, acquired two international companies, achieved
intermittent profitability and operating cash flow positivity, registered multiple new patents, and brought multiple new products
to market. Uscom’s “motivated by vision, driven by fundamentals” culture is beginning to convert to strong on-going
performance and value accretion. Ultimately this will position us in the cross hairs of a new breed of investor seeking real
businesses, looking to build long term holdings in companies with high potential earnings growth, established outperformance
in a high value sector, and heading towards long term dividends.
Uscom remains committed to the Australian Wildlife Conservancy as part of its corporate social responsibility and admires the
amazing work they are doing to ensure our children and grandchildren experience the wonders of Australian nature, and the
status of Australia as the world’s mammalian extinction capital is reversed.
I would also like to thank all Uscom staff across New Zealand, Australia, Singapore, China, Europe and the US for their commitment
and support to achieve the FY21 results in this most difficult time. Many of our people have spent months in shifting lockdowns,
with our offices closed, and as I write this report all of our Australian team are in home isolation, and I’m in quarantine in Chengdu.
The personal cost has been significant with a number of our staff and their family members testing positive. For our sales staff,
access to customers has been limited with their schedules beset with “on again, off again” appointments. So our excellent results
are especially a tribute to a united global team, and for each of their efforts I’m proud and grateful.
Investors are vital part of our Uscom team, and none of our achievements would be possible without your support. For investors
it's a time to review what Uscom has done throughout this challenging year and be proud of the significant steps we build towards
a strongly profitable future. Not only have we delivered successful financial results, but also developed and manufactured life-
saving technologies that improve care for seriously ill COVID patients. Our motivating vision is centred on creating innovative and
life-saving technologies that improve the care of global citizens, and this year more than most, fulfilling that vision was critical.
Uscom reports another successful year to investors as we continued strong financial growth, report our first global operating cash
flow positive year, while investing in global expansion and preparing for the release and sale of new products in the most difficult
of times. We have invested in an expanding global web of subsidiaries servicing increasing regional networks of distributors as
we develop new IP and technologies, and register them for global markets in an increasingly complex global regulatory and sales
environment. We look forward to these activities confirming Uscom as a global health technology leader, with revenue and profits
to drive future dividends into the hands of investors. Uscom will always be a company “motivated by vision and driven by
fundamentals”, and it's this culture that ensures our increasing investor value.
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
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Results
D
U
A
m
$
$6.00
$5.00
$4.00
$3.00
$2.00
$1.00
$0.00
-$1.00
-$2.00
D
U
A
M
$
$6.00
$5.00
$4.00
$3.00
$2.00
$1.00
$0.00
UCM Results FY21
5.58
4.55
4.28
4.6
3.86
3.48
• Cash receipt $5.58m up 21% from $4.60m
• Operating cash inflow $0.06m improved 167%
from outflow $0.03m
Revenue $4.55m up 6% from $4.28m
Sales revenue $3.86m up 11% from $3.48m
Total expenses $4.95m down 4% from $5.16m
Loss reduced to $0.92m, down 31% from $1.33m
•
•
•
•
-1.33
-0.92
-0.03
0.06
Profit
Operating
CF
Sales
Revenue
Cash
Receipts
• Cash on hand $1.71m down from 1.92m
• Debt free
FY20
FY21
UCM Total Cash Receipts
$5.58
$4.60
$3.50
$3.64
$2.94
$2.86
$2.04
$1.38
$0.86 $1.01
•
Total cash receipts $5.58M, up 21% from $4.60M
• Uscom China profitable
• Uscom Europe profitable
•
9-year total cash receipts trend growth
23% pa compound annual growth
549% total increase
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Summary
Uscom continued its consistent growth trend in FY21 with operating cash flow positivity and total annual receipts of $5.58m, up
21% YOY and despite both Europe and the US being intermittently inaccessible for over 6 months and in unpredictable lockdown.
This is the first year we have reported over $5m in cash receipts.
While global markets fluctuated between recovery and shutdown, Uscom China remained stable and profitable despite
geopolitical complications. Uscom Europe was also profitable for the first time in its history, despite suffering personally, nationally
and regionally with the pandemic. Uscom US was also caught between recovery and pandemic returning results less than
predicted as sales appointments were made and cancelled. For Uscom investors FY21 was an excellent year in difficult times as
the company continued to grow strongly, was regionally profitable and operating cash flow positive as sales continued to rise.
While often limited to work from home there was a renewed focus on structural optimisation, driving regulatory, and developing
manufacturing strategies in preparation for once the pandemic passes and our new regulatory approvals are received and our
new premium technologies delivered to market.
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
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Milestones
Uscom China expands with appointment of Assistant to the Director of International Operations – Mr Scott Huang
VENTITEST product released and shifted to post release product development
Uscom China listed as China National High Technology Enterprise by Ministry of Science and Technology Torch High
Technology Centre
TGA approval for two new products - O2 and BASIC haemodynamic monitors for Australian sale
Uscom Singapore incorporated and operational
Uscom Europe restructured to expand R&D, manufacturing and sales
NMPA regulatory cycle initiated for O2 and BASIC
1500th USCOM 1A manufactured
CE approval for SpiroSonic AIR sales in Europe and SE Asia
NMPA approval BP+ for China sales
>200 global IP submissions and active cases
Uscom China ranked AAA Credit Enterprise by China Credit Enterprise Publicity Network
Russian regulatory approval for USCOM 1A
Annual results report first $5m plus total cash receipts
Costs
Total operating expenses for FY21 were $4.86m down 4% from $5.07 in FY20. Salary and wages were $1.61m and unchanged from
FY20, as we expanded Uscom China and our European sales organisation. Increased sales also means increased component and
manufacturing costs. Regulatory expenses will remain a significant part of our operating focus and we expect regulatory costs to
continue as we bring new products to market.
While total operating cash inflow was $0.06m, administration and corporate costs, including tax payments, corporate loans, and
issued shares accounted in lieu of cash, were up $0.83m, undermining global profitability.
The total cost of listing and compliance remains a significant and increasing load on the profitability and mindshare of Uscom,
with an estimated direct annual cost in excess of $0.50M to maintain our ASX listing responsibilities in an increasingly complex
and regulated domain.
Uscom has always been committed to maintaining basic commercial fundamentals, relying on operational cash flow in preference
to opportunistic capital raising. Our EOFY cash holding was $1.71m, and, with an FY21 net operating cash inflow of $0.06m is
adequate foreseeably, discounting any unpredictable change in cash flow. While new product approvals are expected to
significantly supplement sales and cash flow, they will also require capital investment to manufacture stock to promote growth,
and this investment is planned to be funded from current cash flows. While the persistent US trade war and the pandemic make
global markets unpredictable, we remain focused on international events and are preparing for the opportunities as global
markets rebound and confidence in growth resumes.
Uscom Products
Uscom continues to create innovative clinical solutions, based on the IP we have developed and precision technologies we have
manufactured over a number of years.
The SpiroSonic AIR
The SpiroSonic AIR is a new digital home care spirometer equipped with the most advanced performance and functionality and
was released in October last year and is progressing through all major regulatory cycles. It is a wireless charging, wireless
connecting technology which feeds digital lung function signals through a phone APP, the SpiroSonic APP, to the cloud or station
based SpiroReporter for archiving and analysis, and has special application for home use and post COVID recovery monitoring.
The device features voice guided operations and on-board auto diagnostics.
ANNUAL REPORT 2021
USCOM LIMITED
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The new SpiroSonic AIR demonstrating induction wireless charging and connectivity to the SpiroSonic APP and the SpiroReporter,
archiving, analysis and reporting system which can be hard drive installed or cloud-based.
The advantages of the technology include:
Multi-path digital ultrasonic technology with PureFlow tube
Simple to operate
No expensive consumables
Annual calibration (not daily)
Accurate at high and low flows (for children and the elderly)
Approved for home use
Wireless web connectivity (Hospital in the Home applications)
Digital induction charging
Voice guided operations and auto diagnostics (AI)
The SpiroSonic AIR Cycle connecting the patient to the AIR to the SpiroSonic APP, to the clinician for expert and remote diagnosis
and delivery of therapy back to the patient. This represents the front line of the “Hospital in the Home” model of digital health
care and is ideally suited for telemetric management of asthma, COPD and COVID and Post-COVID syndrome. Similar technology
is being developed for the digital BP+ device.
The SpiroSonic PureFlow multi-path ultrasonic technology used in the SpiroSonic AIR device.
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
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USCOM 1A
The USCOM 1A advanced haemodynamic monitor remains the cornerstone product of Uscom Limited providing over 75% of our
total sales. The technology remains the standard of non-invasive cardiovascular monitoring providing precision diagnosis and
therapeutic guidance for administration of fluid, inotropes and vasoactive therapies. Clinically the devices is key for understanding
the status of cardiovascular function in all clinical applications including heart failure, hypertension and sepsis in neonates, children
and adults.
BP+
The BP+ is the newest addition to Uscom’s clinical monitoring technologies and is an advanced cardiovascular monitor and pulse
pressure wave monitor. The device provides multiple measures of brachial pulse pressure waves, suprasystolic pressure waves
and central blood pressure waves. The BP+ provides unique insights in the clinical fields of hypertension, and vascular disease.
Central BP monitoring is the emerging gold standard for hypertension monitoring and provides information at the level of the
heart only previously provided by invasive cardiac catheters.
Combined with the BP+ Reporter, the archiving, analysis, and reporting software that accompanies the BP+, the BP+ provides
the complete solution for advanced hypertension and vascular health monitoring.
VENTITEST
Uscom developed the VENTITEST ventilator testing device for a fast assessment of the performance of ventilators. The technology
is now undergoing development for advanced testing and calibration of ventilators measuring multiple parameters of ventilator
output. An observed phenomenon during critical care admitted COVID patients is ventilator induced lung injury (VILI) which
ensured poor results for ICU patients on ventilation, and may be caused by poor or uncalibrated performance of ventilators. The
global demand for ventilators is projected to increase 10-fold over the next 7 years as hospitals and clinics worldwide are
refurbished and upgraded to deal with consecutive waves of infectious disease over the coming years. The VENTITEST technology
is now being developed to perform advanced real time calibration of ventilators thereby improving the efficacy of ventilation. The
VENTITEST technology is globally patent protected.
The VENTITEST sensor, the VENTITEST-S installed, and the test lung used to create a standardised resistance simulating normal lung function.
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The VENTITEST-S is the accompanying software application that provides archiving, display and analysis of the flow, pressure,
and volume waveforms and provides extended calculations, data logging and test report generation and printing.
Global Operations
In FY21 Uscom continued to review, restructure and expand its global operations in preparations for new approvals and the
rebound in activity following COVID recovery. Uscom SNG in Singapore was activated, Uscom China was consolidated with
expanded distribution and appointment of Mr Scott Huang as Assistant to The Director of International Operations, Ms Teresa
Guo, a change which unites management of Australia, China, SE Asia, Europe and the US. Uscom is now a multinational operation
with multiple products, and intercompany sales, and so a unified relationship between all operations is essential.
As part of the preparation for our new regulatory approvals and the release of multiple new products into global markets, we
have spent a significant time developing globally consistent product pricing, and an accompanying worldwide transfer pricing
strategy, in line with new accounting standards and tax law requirements.
Operations
Sydney
Beijing
Singapore
Budapest
Offices
Auckland
London
Los Angeles
Multiple products hedged for currencies and markets across multiple jurisdictions
Uscom China
Uscom China, based in Chaoyang, Beijing, continues to grow under Ms Teresa Guo’s leadership. The appointment of Mr Scott
Huang as her assistant has allowed their local management strategies to be expanded into Europe and the US resulting in a
restructure and first ever profitable year in Uscom Europe. Mr Meng Xianhui remains a non-executive Director on the UCM Board
of Directors delivering his extensive experience as both an international investor and executive in the biotechnology field.
While recent geopolitical tensions have created some concern for some investors, China welcomes the skills that Uscom brings
to China as the below statement confirms.
"We (China) excel in fields …… like nanotechnologies, system and control engineering, and telecommunications and artificial
intelligence,". "But the US is exceptional in fields such as medicine, social sciences, economics and business, and
biosciences, all of which are topics in which China needs significant improvements."
Wang Xiaomei. "Mapping Science Structure 2021". The Chinese Academy of Sciences' Institutes of Science and Development. (2nd May 2021)
http://www.chinadaily.com.cn/a/202105/01/WS608c9670a31024ad0babba3c.html
Uscom has received recognition in China for its biomedical academic, technologic and entrepreneurial skills with a number of
Government statements and awards.
ANNUAL REPORT 2021
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Uscom China progress in FY21:
China National High Technology Enterprise
AAA Credit Enterprise
Increased sales with profitable and cash flow positive operations
Expanding distribution network
Increased clinical support and marketing materials specific for China
Managed NMPA submissions for BP+, SpiroSonic and new O2 and BASIC devices
Received NMPA for BP+
Developed Uscom IP portfolio in China (>50 submissions)
Awarded China National High Technology Enterprise from High Torch and Ministry of Science and Technology
Uscom China joined Austrade at the Shanghai CMEF medical device trade fair with USCOM 1A and BP+
Recognised as AAA Credit Enterprise ranking from China Credit Enterprise Publicity Network
Marketing preparation for China release of BP+
Continued discussions with potential Chinese partners for local manufacturing and strategic partnerships
Uscom Singapore
Uscom SNG Pte. Ltd was established as a Regional Headquarters in Singapore and a platform for increased Asian and SE Asian
engagement. The Headquarters will act as a regional sales, technical and clinical support hub anchoring regional expansion into
the SE Asian market. SE Asia is a critical growth driver for global economies, and Singapore is geographically convenient,
positioned between Uscom Sydney, and its major market of China, and its European manufacturing centre in Budapest.
Uscom Europe
Uscom Europe has undergone a number of changes over the last year which have produced great results, with total revenue
increasing to $793K, and a $378k loss converting to a $30k profit – the first profit for the Hungarian business since incorporation
in 2005. Through the year Mr Tamas Vitrai was appointed as Company Manager, and Zsofia Kertesz appointed as Marketing and
Finance Manager, with both working closely with Teresa Guo, Director of International Operations and China GM, and more
recently Mr Scott Huang, assistant to the DIO. Dr Antonio Ferrario, our European Sales and Marketing Manager is working to
induct a newly appointed sales executive Ms Viktoria Dinocsik as we develop the foundations of a direct European clinical sales
marketing team. Many of our initiatives have been difficult to implement during the last pandemic year, however the foundations
have been put in place and we look forward to them yielding a strong sales uplift in the year ahead. It is expected that our Russian
distributiors will also provide an addition to our future European sales as they move into the market.
Uscom USA
Uscom appointed and trained a new dealer network of >30 sales persons to cover ~80% of the US geography for USCOM 1A
sales immediately prior to the pandemic shutdown in mid FY20. We are now reinitialising this team and training them in the BP+
and SpiroSonic technologies so we can identify potential pre-approval sales. As business slowly normalises there are now signs
of a rebound with more leads, more demonstrations and a building sales pipeline. A number of key sales into prestigious KOL
hospitals are pending which will influence additional national buyers.
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
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Sales by Product and Region
This year USCOM 1A reached its milestone 1500th manufactured device, confirming the value of our premium cardiac monitoring
technology. This milestone was predicated on the principle of simple clinical value; the usefulness of the product. We are proud
of the number of neonates, children and adults treated each day, worldwide, with our USCOM 1A, and the number of lives it has
saved or improved.
Sales by Product
FY2021
4%
19%
77%
Sales by Region
FY2021
8% 2%
26%
64%
USCOM 1A SpiroSonic BP+
China/Asia
Europe US/Other Australia
USCOM 1A sales remained strong despite limited access to clinicians and hospitals, and the device remains Uscom’s cornerstone
product generating 77% of Uscom’s total sales revenue. In terms of % of total Uscom revenue both BP+ and SpiroSonic
technologies increased over FY21. SpiroSonic sales reached 19% of total revenue in FY21 associated with an increase in COVID-19
lung function monitoring, while the increase of BP+ sales was associated with the release of BP+ Reporter and increased research
sales and increasing clinician attention.
Regionally China and SE Asia were responsible for the majority of total global sales, while Europe increased to 26%, with US sales
also increasing significantly. This changing sales pattern demonstrates the early success of our strategic restructure of distribution
in Europe and the US in FY20, combined with early signs of a pandemic rebound.
Regulatory - Ticking the boxes in preparation for FY22
For Uscom FY21 was a year of ticking the regulatory boxes as we received new regulatory approvals for China, Europe, Russia and
Australia, with additional NMPA and FDA approvals pending. The SpiroSonic AIR received approval for Europe and much of SE
Asia, the BP+ received NMPA approval for China, and the USCOM 1A received certification for Russia. Currently SpiroSonic AIR
is reaching the final stages of FDA approval for the US, and NMPA for China, both of which are expected in the next 3-12 months.
The USCOM O2 and BASIC are also under review with the NMPA. This series of approvals expands our sales “product regions”
by over 140%, and adds significant opportunity for us to expand our distribution partnerships both established and new, and grow
revenue.
GLOBAL REGULATORY
7 New Approvals
Regions
Approvals
USCOM 1A
2021
2022
Pending
✓ New Approvals
China
SE Asia
Europe
US
Russia
12 Product Regions for sale in FY22
ANNUAL REPORT 2021
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Regulatory approvals are required to sell medical devices into all jurisdictions with our main regulatory approvals being NMPA
for China, CE for Europe and FDA for the US, and each requires a detailed, expensive and time-consuming submission The global
regulatory process has grown exponentially with regulatory bodies remaining independent and minimal reciprocity, and it’s this
increasing complexity which increases the value of our approvals, and acts as a barrier to entry for new competitors.
New approvals in Europe, China and Russia support the FY22 “more products, more distributors, more sales and more profit”
strategy.
China – NMPA
Europe - CE
Russia – Roszdravnadzo
Australia – TGA
US – FDA
Uscom BP+ received a 5-year approval in April, with SpiroSonic approaching approval, and
expected in 6-12 months. USCOM 1A received a 5-year approval last year, while O2 and BASIC are
in submission with approval expected in 12-24 months.
In May the SpiroSonic AIR received CE Mark allowing sale into Europe. The CE Mark is commonly
used in SE Asia and MEast as complete or part regulatory approval. USCOM 1A and BP+ have also
received the CE Mark.
The Russian regulatory body is the Federal Service on surveillance in Healthcare and Social
Development Roszdravnadzor and certification is necessary for sale into the Russian market.
USCOM 1A received Roszdravnadzor certification in late June. We are planning for lodgement of
applications for SpiroSonic and BP+ with assistance of our local distribution partner Wondermed.
The Therapeutic Goods Administration of Australia registered the two new cardiac output monitors,
O2 and BASIC, for sale in Australia in May. The USCOM 1A, the SpiroSonic series and the BP+ are
already approved for sale in Australia.
The SpiroSonic series are currently undergoing FDA preparation and approval is expected in 3-6
months, while BP+ submission is continuing. The USCOM 1A has an active FDA approval while both
the SpiroSonic and BP+ have approval for research sale, current submissions include expanded
functionality in line with other international approvals.
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Science
Uscom was founded on leadership in science, and our technologies are increasingly being recognised internationally for
leadership in cardiovascular and pulmonary monitoring and management science. In FY21 the USCOM 1A and SpiroSonic devices
have established important global clinical roles in acute and chronic COVID, while the USCOM 1A continues to revolutionise
diagnosis and management of preeclampsia, and BP+ emerges as a leader in the massive and complex field of hypertension.
Recent Publications
Pneumonia and children - China
septic
The study concludes “USCOM
is easy to operate, can
accurately evaluate hemodynamic status in children with severe
pneumonia and
shock, provides personalised
management of vasoactive drugs, in has important clinical value
in this application.”
Pang X, Song A. Ultrasonic Cardiac Output Monitor (USCOM)
Application in Severe Pneumonia Complicated Septic Shock of
Hemodynamic Assessment and Treatment
in Children.
2021:11(2);714-721.
Advances
doi.org/10.12677/acm.2021.112102
Clinical
Med
in
Comparison with MRI – Australia, - UK
Uscom advantages over MRI include accuracy, feasibility, ease
of use, cost, fit for purpose, easy to learn and implement, with
established long term utility data.
Phillips RA, Brierley J. A Deeper Understanding of Physics,
Physiology, Experimental Methodology and Statistics
is
Essential for Valid Comparison of USCOM 1A and cMRI. Ped
Cardiol 2021; 42: 981–982. doi.org/10.1007/s00246-021-02604-2
Comparison of USCOM 1A with GE LOGIQ - Italy
it
USCOM 1A advantages over GE LOGIQ S8 include simple
bedside use, accessibility, two years training versus 2 days, and
is simpler to monitor longitudinal changes such as in heart
failure or during therapy, concluding “the USCOM can be used
by any physician with a knowledge of cardiovascular physiology
and
is particularly suitable for cases when frequent
measurements are required.
Pliauckiene A, Liubsys A, Vankeviciene R, Usonis V. Ultrasonic
cardiac output monitor provides effective non
invasive bedside
measurements of neonatal cardiac output. Journal of Clinical
‑
Monitoring
2021.
April
https://doi.org/10.1007/s10877-021-00711-2
Computing.
30th
and
Comparison of USCOM 1A with Bioimpedance in Pediatrics - Indonesia
This study found bioimpedance was unable to detect patients
requiring fluid, nor the amount of fluid required, while USCOM
1A was very good in these critically ill children with septic shock
requiring fluid and mechanical ventilation. “This study showed
that electrical cardiometry (ICON) is unable to assess preload
and the response of fluid resuscitation in children.”
Kadafi TK, Latief A, Pudjiadi AH. Determining pediatric fluid
responsiveness by stroke volume variation analysis using
ICON® electrical cardiometry and ultrasonic cardiac output
monitor: A cross-sectional study. Int J of Crit Ill Inj Sci 2020;
10(3):123-128. doi: 10.4103/IJCIIS.IJCIIS_87_18
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
P a g e | 13
Comparison of USCOM 1A with Bioimpedance for Exercise Testing - China
The study comparing USCOM 1A and Bioimpedance,
concluded “These findings suggest that the suitability of
(Bioimpedance) for sports use is questionable.”
Cheung CHY, Khaw ML, Tam VCW, Ying MTC, Lee SWY.
Performance evaluation of a portable bioimpedance cardiac
output monitor for measuring hemodynamic changes
in
athletes during a head-up tilt test. J Appl Physiol 2020; 128:
1146–1152,; doi:10.1152/japplphysiol.00822.2019
IP and Brands
Uscom actively manages a growing portfolio of international patents, copyrights and trademarks and has in excess of 200 discrete
worldwide intellectual property (IP) submissions protecting the current novel Uscom devices and our developing pipeline of new
products.
Great brands are a foundation for a great company and Uscom has four great brands - USCOM 1A, BP+, SpiroSonic and
VENTITEST, with each sitting over a suite of individual products. Our brands demonstrate the culture of our company; innovative,
strong, clean and impactful.
Education and Distributor Support
Uscom devices are innovative and so their successful adoption depends on customer education both on the science of our
technologies and their clinical utility in determining diagnosis and therapy, and improving outcomes. The delivery of
comprehensive and professional education modules enhances our brands and our products and enhances their adoption.
Scarlett Zhang, Uscom China’s Critical Care Application Specialist training clinicians in the use of USCOM 1A at Lanling People’s Hospital in
Shandong Province, China. Education is critical to successful adoption of the USCOM 1A and involves new concepts and clinical practices.
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
P a g e | 14
Strategy FY22
The simple strategy for Uscom FY22 is “more products, more distributors, more sales and more revenue”. Importantly we have
the recent and impending cluster of approvals to fuel this strategy, with our “product regions” set to be increased by 140% in
FY22. While the appointment, training and activation of new distributors to sell these new devices in new regions takes some
time, each new sale adds revenue to our near break-even FY21 position to drive us to profitability. These new approvals will feed
new devices into our new global hub of subsidiaries and their associated distribution networks that we have developed over the
last 10 years. This expansion has been expensive, time consuming and strategic, and positions Uscom ideally for the next phase
of our business. These new products, and our expanding global distribution networks represent real off balance-sheet investor
value. However, in FY22 we anticipate these strategic investments will reward investors with real further revenue growth as our
new product approvals deliver products to our increased distributor network across the world. From this integrated global
platform will evolve opportunities for strategic corporate activities to further grow products and revenues and a platform on which
to grow a significant global health technology enterprise.
Product Regions increased from FY21 - 5 to FY22 – 12
Investment
“Hunt for stock market treasures: Outperforming value plays with growth potential”
CNBC Trading Nation - 26th December 2020
• Attractive valuation (low multiple)
• High potential for earnings growth
• Quarterly outperformance
• High value sector
Operating cash flow positivity and intermittent profitability confirm Uscom’s position as an investment opportunity. Uscom
continues to grow operational fundamentals while executing strategic global expansion, both leading to increased shareholder
value and ultimately dividends. For FY21 the Uscom FPO VWAP was 17.7c, ranging from 12.0 c to 27.5c, with 59M shares traded
over the year being approximately 38% of issued capital. The average share price for the previous 9-years was 18.6c, while total
cash receipts increased by 549% over this time with a CAGR of 23% suggesting a continuing path to dividends. This mismatch of
rapidly improving fundamentals and unchanged SP creates a unique combination for value investors.
During the year Uscom Board and management purchased UCM FPO shares on market and continued to increase their holding
and reducing market holdings from ~1200 to ~1000. This follows a small parcel share buy-back last year which reduced UCM
shareholdings by 25%. This consolidation strategy simplifies the Uscom register and will decrease administrative cost of
communications and ultimately drive the per unit value of UCM shares as we approach the dividend phase of the business.
Uscom has developed an active in-house social media strategy across MailChimp, Twitter, Facebook and LinkedIn to ensure
awareness of our activities and achievements, and to provide investors with immediate information and results to support
informed investment decisions.
“Quite honestly this seems to be the right company with the right products at the right time for huge growth to commence.
Stay tuned. This could well be quite a large global company in the making”
Independent Investor commentary following NWR Investor Conference Presentation, “Motivated by Vision, Driven by Fundamentals” - 5th
August 2021. (https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02403179-
2A1313509?access_token=83ff96335c2d45a094df02a206a39ff4)
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
P a g e | 15
Risks
The Pandemic
COVID-19 has changed the way we do business. The time to recovery from this pandemic is unpredictable, with some suggesting
we will need to adapt to living with waves of seasonal infections which will continue to damage Uscom’s business. The
establishment of global business centres in Australia, Singapore, China, Budapest, London and LA assists us to keep channels
open to international markets and mitigate against regional outbreaks.
Global Markets
Uscom’s expanded global operations creates exposure to risk such as international trade wars, currency volatility, regional Health
reform, Brexit, economic slowdowns, and geo-political conflicts. However global diversification, while exposing us to a wider
range of challenges, also mitigates against the dangers of regional risks.
China
China is our major market and investment for Uscom, and any significant change in business conditions in China may impact us
as we respond. Uscom has confidence in the scale and accessibility of the China market as China continues to value the
technologic, academic and entrepreneurial bioscience skills that Uscom practices.
Distributors
Uscom depends on distribution to deliver its products to market and has substantially revised our global sales strategy as we
move to take a more direct role in all our markets. Increasingly we are developing a model with high quality administrative people
managing direct dealers selling into multiple markets. As we continue to grow it is conceived that a simple sub-distribution model
will remain the most cost efficient. We continually monitor our markets to optimise our operations and adjust for unpredicted
negative changes.
Regulatory
Regulatory certification is increasingly complex, expensive and time consuming in all jurisdictions. Uscom is managing multiple
regulatory submissions for a number of products across four continents into multiple markets, and international trade protection
is increasingly an identified risk for management.
Key Personnel
Uscom is dependent on a small, skilled and vital team working to ensure and manage ongoing rapid growth. Implementation of
a competitive executive remuneration plan and adequate executive compensation may mitigate the risk of damaging
resignations. The expansion of Uscom China and the expansion of Uscom Europe and Uscom Inc. in the US will also disperse
these risks.
Other Risks
Competitive risks, patent breaches, and scale up stress are potential threats to our growth expectations, and may challenge cash
flow management and equity adequacy, and require the focused attention of management.
Corporate Social Responsibility
the
preserving
Uscom supports the Australian Wildlife
Conservancy and its goals of conserving
Australian
and
environment and animals, and reversing
Australia’s record as the mammalian
extinction capital of the world. In the last
15 years Australia’s threatened species list
has increased by 36%. With strategic
expansion of predator and feral free
environments the AWC has reported
significant success in conserving many of
our most threatened animals by re-
vitalising current populations and re-
introducing others to newly protected
the vital
habitats. Uscom
the AWC
national activities of
-
(Rob Phillips
www.australianwildlife.org
personally supports AWC on behalf of
Uscom Limited)
supports
Northern Quoll populations are benefiting from AWCs reintroduction programmes
ANNUAL REPORT 2021
USCOM LIMITED
C H A I R M A N ’ S L E T T E R
P a g e | 16
Conclusion
FY21 was a milestone year for Uscom, as it reported its first full operating cash flow positive year, and its first total cash receipts
in excess of $5m, with profitability in both China and Europe. Uscom received three new regulatory approvals for China, Europe
and Russia, with another two for the US and China nearing completion, with each new approval representing a new revenue
stream. Our FY22 strategy is simple; “more products, more distribution, more sales and more revenue”. We have received our
new product approvals, and we have strategically invested in a global web of subsidiaries to access all our major markets, and are
now developing the network of distributors attached to each regional hub to deliver our products to market. This global, vertically
integrated entity directly connected to the market, creates an efficient pathway into which we can feed new products for rapid
delivery to market and a model set to deliver sales, profit and growth foreseeably.
Thanks to shareholders for their support as we execute on our ‘motivated by vision, driven by fundamentals” corporate mission.
While this year was challenging worldwide, we maintained strong growth and investment, while growing shareholder value and
creating a platform for long term shareholder wealth, and we look forward to the benefits of our sound strategy continuing to
grow the strength of Uscom foreseeably.
Kind Regards
Professor Rob Phillips
Chairman
18 August 2021
ANNUAL REPORT 2021
USCOM LIMITED
P a g e | 17
ASX ANNOUNCEMENTS FY2021
Announcements are a measure of corporate activity, and below is the list of FY 2021 announcements (Excluding
Financial Reporting) with those deemed to be financially sensitive by the ASX marked as ($), being 21 of 46:
1
2
3
4
5
6
7
8
9
29/06/2021
Change of Director's Interest Notice - Phillips
31/05/2021
Change of Director's Interest Notice - Meng
27/05/2021
Change in Substantial Holding - Meng
27/05/2021
Change of Director's Interest Notice - Meng
27/05/2021
Two New USCOM Monitors Get Australian TGA Clearance ($)
26/05/2021
Cleansing Notice
26/05/2021
Appendix 2A
24/05/2021
SpiroSonic AIR Approved for European CE Mark ($)
04/05/2021
Two New Uscom Devices for China ($)
10 26/04/2021
Appendix 4C – Quarterly ($)
11 19/04/2021
China NMPA Approves Uscom BP Plus ($)
12 29/03/2021
BP Plus in Final Review Phase of NMPA In China ($)
13 26/02/2021
Section 708A Notice
14 26/02/2021
Appendix 2A
15 24/02/2021
FY21 H1 Investor Presentation - Strong Growth, Bright Future ($)
16 24/02/2021
Half Yearly Report and Accounts ($)
17 23/02/2021
Uscom Half Year Results Webinar
18 27/01/2021
Appendix 4C – Quarterly ($)
19 09/12/2020
Amended Change of Director's Interest Notice
20 09/12/2020
Change Of Director's Interest Notice
21 09/12/2020
H1 Market Update FY21 (5 Mths) V FY20 (6 Mths) ($)
22 04/12/2020
Uscom China Listed as National High Technology Enterprise ($)
23 25/11/2020
Cleansing Notice
24 25/11/2020
Appendix 2A
25 05/11/2020
Uscom NWR Virtual Investor Conference ($)
26 05/11/2020
Uscom To Present at NWR Virtual Conference
27 29/10/2020
Change of Director's Interest Notice - Phillips
ANNUAL REPORT 2021
USCOM LIMITED
A S X A N N O U N C E M E N T S F Y 2 0 2 1
P a g e | 18
28 29/10/2020
Cleansing Notice
29 29/10/2020
Appendix 2A
30 29/10/2020
Results of Meeting
31 29/10/2020
Uscom 2020 AGM Presentation ($)
32 15/10/2020
Appendix 4C – Quarterly ($)
33 29/09/2020
Notice of Annual General Meeting/Proxy Form
34 01/09/2020
Corporate Governance Statement
35 01/09/2020
Change of Auditor
36 01/09/2020
Appendix 4G
37 28/08/2020
Cleansing Statement
38 28/08/2020
Appendix 2A
39 17/08/2020
Uscom 4E Annual Results 2020 ($)
40 04/08/2020
Uscom VENTITEST Global Release ($)
41 04/08/2020
Pause in Trading ($)
42 20/07/2020
USCOM 1A Evidence for Early Treatment of Preeclampsia ($)
43 14/07/2020
FY2020 Q4 Investor Briefing ($)
44 13/07/2020
Quarterly Activities Report - June 2020 ($)
45 13/07/2020
Appendix 4C – Quarterly ($)
46 10/07/2020
Upcoming Investor Webinar
ANNUAL REPORT 2021
USCOM LIMITED
P a g e | 19
DIRECTORS REPORT
The Directors present their report on Uscom Ltd and its Controlled Entities for the financial year ended 30 June
2021.
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.
Associate Professor R A Phillips
Mr C Bernecker
Mr B Crowley
Mr X Meng
Executive Director - Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Directors’ qualifications and experience
Associate Professor Rob Phillips (Chairman and Executive Director)
Rob Phillips is the founder of Uscom Ltd, and the Chief Executive Officer, Chairman and Chief Scientist
of the Company. Rob has 18 years’ experience in corporate management since taking Uscom public in
2003, and has taken the company to profitability, established global operations and overseen the
acquisition of two international medical device companies. Rob has a PhD and MPhil in Cardiovascular
Medicine from The University of Queensland where he is an Adjunct Associate Professor of Medicine.
Mr Christian Bernecker (Non-executive Director)
Mr Christian Bernecker is a Non-Executive Director of Uscom Ltd since November 2011. Christian 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 Brett Crowley (Non-executive Director and Company Secretary)
Brett Crowley was appointed as a Non-Executive Director of Uscom Ltd on 23 August 2018. 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.
Mr Xianhui Meng (Non-executive Director)
Xianhui Meng is an experienced international value investor, with qualifications in economics,
engineering management and business administration. Mr Meng has 10 years experience as a China
government departmental head, and 20 years experience as the Executive Manager and Executive
Director of a HK Listed Chinese Pharma specialising in sales and distribution. Mr Meng brings both his
international corporate management and strategic skills to the Uscom Board.
Company secretary’s qualifications and experience
Mr Brett Crowley
Brett Crowley is also the Company Secretary since 24 May 2016.
ANNUAL REPORT 2021
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D I R E C T O R S R E P O R T
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Meetings of Directors
Directors
R A Phillips
C Bernecker
B Crowley
X Meng
Principal activities
Board of Directors
Meetings held while a Director
6
6
6
6
No. of meetings attended
6
5
6
6
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
products primarily in the United States, and owns 100% of Uscom Kft, a company that manufactures respiratory devices based in
Hungary. Uscom Ltd owns 100% of Beijing Uscom Consulting Co. Ltd, a company that manages and sells Uscom products in
China.
Operating result
The loss of the Consolidated Entity after providing for income tax amounted to $924,243 (2020: $1,331,335).
Dividends
No dividends were declared or recommended for the financial year ended 30 June 2021 (2020: nil).
Significant changes in state of affairs
There were no significant changes in state of affairs during the financial year.
Corporate Governance Statement
Refer to the investor page of Uscom Limited’s website www.uscom.com.au/for-investors.
Operating and financial review
The operating and financial review is stated per the Chairman’s letter on pages 1-16.
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.
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 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.
Indemnity of auditors
To the extent permitted by law, the Company has not agreed to indemnify its auditors, BDO Audit Pty Ltd, as part of the terms
of its audit engagement agreement against claims by third parties arising from the audit [for an unspecified amount]. No payment
has been made to indemnify BDO Audit Pty Ltd during or since the financial year.
ANNUAL REPORT 2021
USCOM LIMITED
D I R E C T O R S R E P O R T
P a g e | 21
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 24 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 46 for details of auditors’ remuneration.
The auditor’s independence declaration as required under section 307C of the Corporation Act is set out on page 27.
BDO Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.
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
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:
Non-Executive Directors
Christian Bernecker, Non-Executive Director
Brett Crowley, Non-Executive Director (Appointed on 23 August 2018)
Xianhui Meng, Non-Executive Director (Appointed on 16 December 2019)
Executive Directors
Rob Phillips, Executive Director, Chairman, Chief Executive Officer
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 Directors, Non-Executive Directors and Senior Executives.
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
ANNUAL REPORT 2021
USCOM LIMITED
D I R E C T O R S R E P O R T
P a g e | 22
• 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.
Non-Executive Directors
The Board determines the Non-Executive Director remuneration by independent market data for comparative Companies.
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 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’ retirement payments are limited to compulsory employer superannuation.
Executive Directors and Senior Executives remuneration
The Consolidated Entity’s remuneration policy directs that the remuneration package appropriately reflects the Executives’ duties
and responsibilities 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.
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
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.
Short-term incentives
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 approve discretionary bonuses to Executives in relation to certain milestones being achieved.
Long-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.
Independent data from applicable sources may be requested by the Board to assess whether the performance hurdles have been
met.
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.
ANNUAL REPORT 2021
USCOM LIMITED
D I R E C T O R S R E P O R T
P a g e | 23
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 made up of three
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
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.
If either the Consolidated Entity or the Executive gives notice of termination, the Consolidated Entity may, at its discretion, choose
to terminate 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.
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.
Service contracts have been entered into by the Consolidated Entity with non-executive directors, describing the components
and amounts of remuneration applicable on their initial appointment. These contracts are at fixed fees for their service.
Service contracts have been entered into by the Consolidated Entity with key management personnel, describing the components
and amounts applicable on their initial appointment, including terms and performance criteria for performance-related cash
bonuses. These contracts do not fix the amount of remuneration increases from year to year. Remuneration levels are reviewed
generally each year by the Board of Directors to align with changes in job responsibilities and market salary expectations. All
contracts are for on ongoing period.
Key management personnel remuneration
Remuneration includes salaries, benefits and superannuation contributions in respect of the financial year 2021.
Short term benefits
Directors’
Base Fee
$
Base
salary
$
Annual leave
cash out
$
Post-employment
benefits
Superannuation
$
Long term
benefits
Long service
leave
$
Equity
Share-based
payment
$
Total
remuneration
Performance
related
$
%
Non-Executive
Director
C Bernecker
B Crowley
X Meng
Executive
Director
R Phillips
Senior
Executive
N Schicht
Total
38,325
34,959
-
-
-
-
-
-
-
-
3,321
-
-
-
-
-
-
-
38,250
38,280
-
-
-
-
-
250,755
60,366
-
13,580
361,176
685,877
52.7%
-
73,284
196,000
446,755
-
60,366
18,620
21,941
10,390
23,970
20,000
381,176
245,010
1,007,492
8.2%
37.8%
ANNUAL REPORT 2021
USCOM LIMITED
D I R E C T O R S R E P O R T
P a g e | 24
Remuneration includes salaries, benefits and superannuation contributions in respect of the financial year 2020.
Short term benefits
Directors’
Base Fee
$
Base
salary
$
Annual leave
cash out
$
Post-employment
benefits
Superannuation
$
Long term
benefits
Long service
leave
$
Equity
Share-based
payment
$
Total
remuneration
Performance
related
$
%
Non-Executive
Director
C Bernecker
B Crowley
X Meng
Executive
Director
R Phillips
Senior
Executive
N Schicht
Total
38,325
34,959
-
-
-
-
-
-
-
-
3,321
-
-
-
-
-
-
-
38,325
38,280
-
-
-
-
-
250,755
15,009
-
9,402
77,309
352,474
22%
-
73,284
189,000
439,755
-
15,009
17,955
21,276
6,201
15,603
5,103
82,412
218,259
647,339
2%
13%
Equity Incentive Plan
The Consolidated Entity has adopted an 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.
Number of rights over ordinary shares held by Directors and Senior Executives
Balance
Granted
Exercised
Lapsed /
Cancelled
During FY2021 During FY2021 During FY2021
No.
No.
No.
Balance
Total Vested
30 June 2021
No.
30 June 2021
No.
Total
Unexercisable
20 June 2021
No.
Non-Executive
Director
C Bernecker
B Crowley
X Meng
Executive Director
R Phillips (a)
Senior Executive
N Schicht (b)
Total
1 July 2020
No.
-
-
-
-
450,000
450,000
-
-
-
1,436,782
-
1,436,782
-
-
-
-
300,000
300,000
--
--
--
--
--
--
-
-
-
1,436,782
150,000
1,586,782
--
--
--
--
--
--
-
-
-
1,436,782
150,000
1,586,782
Further details of the options and rights are disclosed in Note 19 of the financial statements.
Details of rights outstanding as at end of year
Holders No.
Grant date
Exercisable
at 30 June 2021
%
Vesting date
30 June 2021
Outstanding Right
No.
Exercise
Price
$
Issued date
fair value
$
1 (Executive)
Total
26 November 2014
100%
1 July 2020
150,000
150,000
0.00
0.19
(a) 1,436,782 Indeterminate rights were issued to Rob Phillips on the terms and conditions approved by shareholders at the AGM
on 29 October 2020 under the Equity Incentive Plan, vesting dependent on performance hurdles on 1 July 2021. Consideration
ANNUAL REPORT 2021
USCOM LIMITED
D I R E C T O R S R E P O R T
P a g e | 25
payable upon vesting is $nil. The Board exercised its discretion to pay cash in lieu of issue of ordinary shares. Upon meeting the
performance hurdles, total of 1,436,782 were exercised on 5 July 2021 after the reporting date.
(b) 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.
300,000 were exercised on 28 August 2020 and remaining balance is 150,000 as the reporting date.
Number ordinary shares held by Directors and Senior Executives
Balance
Received as
Options/Rights
01 July 2020
Remuneration
Exercised
No.
No.
No.
Purchased on
market
No.
Balance
30 June 2021
No.
Non-Executive Director
C Bernecker
B Crowley
X Meng
Executive Director
R Phillips
Senior Executive
N Schicht
Total
-
-
31,368,208
26,865,547
313,200
58,546,955
-
-
-
-
-
-
-
-
-
200,000
1,492,292(1)
-
200,000
32,860,500
3,734,627(2)
30,600,174
114,943
114,943
300,000
300,000
-
5,426,919
728,143(3)
64,388,817
*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 Smart Top Overseas Limited managed by Citicorp Nominees Pty Limited, 1,000,000
ordinary shares were purchased on market on 25 May 2021 and 492,292 ordinary shares were purchased on market on 26
May 2021.
(2) 3,090,000 @ $0.10 were allotted on 29 October 2020 for $300,000 share capital placement in advance on 30 September 2020
and included 90,000 shares were on account of interest payment. 644,627 ordinary shares were purchased on market on 28
June 2021.
(3) 5,000 of these ordinary shares are held by a family associate.
Additional Information
The earnings of the consolidated entity for the five years to 30 June 2021 are summarised below:
2021
$
2020
$
2019
$
2018
$
2017
$
Sales Revenue
Loss after income tax
3,858,081
(924,243)
3,479,758
(1,331,335)
2,844,138
(1,389,398)
2,168,051
(1,960,923)
2,723,359
(1,800,849)
The factors that are considered to affect total shareholders return (‘TSR’) are summarised below:
Share Price at financial year end ($)
Total dividends declared (cents per share)
Basic earnings declared (cents per share)
2021
2020
0.16
-
(0.6)
0.22
-
(0.9)
2019
0.14
-
(1.0)
2018
0.17
-
(1.6)
2017
0.19
-
(1.6)
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.
Professor Rob Phillips
Chairman
18 August 2021
ANNUAL REPORT 2021
USCOM LIMITED
FINANCIAL REPORT
AUDITORS INDEPENDENCE DECLARATION
STATEMENT OF PROFIT AND LOSS & OTHER
COMPREHENSIVE INCOME
STATEMENT OF FINANCIAL POSITION
STATEMENT OF CHANGES IN EQUITY
STATEMENT OF CASH FLOWS
P a g e | 26
27
28
29
30
31
NOTES TO FINANCIAL STATEMENTS
32-47
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 27
AUDITOR’S 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 JOHN BRESOLIN TO THE DIRECTORS OF USCOM LIMITED
As lead auditor of Uscom Limited for the year ended 30 June 2021, 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 entities it controlled during the period.
John Bresolin
Partner
BDO Audit Pty Ltd
Sydney
18 August 2021
BDO Audit Pty Ltd ABN 33 134 022 870 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 Audit Pty Ltd 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.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 28
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
& OTHER COMPREHENSIVE INCOME
For the Year Ended 30 June 2021
Continuing operations
Revenue and other income
Raw materials and consumables used
Expenses from continuing activities
Loss before income tax from continuing operations
Income tax
Loss after income tax from continuing operations
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Foreign currency translation difference for foreign operations, net of tax
Other comprehensive income for the year, net of tax
Total comprehensive income/(loss) for the year
Attributable to:
Owners of the Company
Total comprehensive income/(loss) for the year
Earnings per share from continuing operations attributable to the owners of
the Company
Earnings per share (EPS)
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
Note
Note
2021
$
2020
$
3
4
5
6
7
7
4,554,810
(485,073)
4,284,726
(435,007)
(4,951,940)
(5,163,908)
(882,203)
(1,314,189)
(42,040)
(17,146)
(924,243)
(1,331,335)
50,189
50,189
(13,185)
(13,185)
(874,054)
(1,344,520)
(874,054)
(1,344,520)
(874,054)
(1,344,520)
(0.6)
(0.6)
(0.9)
(0.9)
This Statement of Profit or Loss and Other Comprehensive Income is to be read in conjunction with the attached Notes.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 29
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2021
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Tax asset
Total current assets
Non-current assets
Bank guarantee
Plant and equipment
Intangible assets
Right-of-use assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Provisions
Lease liabilities
Total current liabilities
Non-current liabilities
Provisions
Lease liabilities
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserve
Accumulated losses
Total equity
Note
Note
2021
$
2020
$
8
9
10
11
12
13
14
15
16
17
15
17
15
18
19
6
1,710,554
404,366
894,877
441,283
3,451,080
83,456
99,310
469,684
1,231,438
1,883,889
1,920,657
453,700
828,853
475,109
3,678,319
83,456
163,524
498,122
1,493,980
2,239,082
5,334,969
5,917,401
556,020
203,765
189,050
948,835
597,124
213,985
187,310
998,419
67,652
1,240,884
1,308,536
66,703
1,429,935
1,496,638
2,257,371
2,495,057
3,077,598
3,422,345
34,665,560
3,352,406
(34,940,368)
34,197,430
3,241,040
(34,016,125)
3,077,598
3,422,345
This Statement of Financial Position is to be read in conjunction with the attached Notes.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 30
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the Year Ended 30 June 2021
Issued
Capital
$
Options and rights
Reserve
$
Other
reserves
$
Accumulated
Losses
$
Foreign Currency
Translation
Reserve
$
Total
$
Balance at 30 June 2019
33,300,933
2,824,660
Loss for the year
Other comprehensive
income
Total Comprehensive
Income for the year
Transactions with Owners
in their capacity as
owners:
Shares issued (Note 18)
Transaction costs on shares
issued (Note 18)
Share-based payments
(Note 18) (Note 19)
-
-
-
750,000
(16,455)
162,952
-
-
-
-
-
82,412
-
-
-
-
-
-
-
Unissued equity (Note 19)
-
-
300,000
(32,684,790)
47,153
3,487,956
(1,331,335)
-
(1,331,335)
-
(13,185)
(13,185)
(1,331,335)
(13,185)
(1,344,520)
-
-
-
-
-
-
-
-
750,000
(16,455)
245,364
300,000
Balance at 30 June 2020
34,197,430
2,907,072
300,000
(34,016,125)
33,968 3,422,345
Loss for the year
Other comprehensive
income
Total Comprehensive
Income for the year
Transactions with Owners
in their capacity as
owners:
Shares issued (Note 18)
Transaction costs on shares
issued (Note 18)
Share-based payments
(Note 18) (Note 19)
-
-
-
309,000
(10,870)
170,000
-
-
-
-
-
361,177
-
-
-
-
-
-
Unissued equity (Note 19)
-
-
(300,000)
(924,243)
-
(924,243)
-
50,189
50,189
(924,243)
50,189
(874,054)
-
-
-
-
-
-
-
-
309,000
(10,870)
531,177
(300,000)
Balance at 30 June 2021
34,665,560
3,268,249
-
(34,940,368)
84,157 3,077,598
This Statement of Changes in Equity is to be read in conjunction with the attached Notes.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 31
CONSOLIDATED STATEMENT OF CASH FLOWS
For the Year Ended 30 June 2021
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Interest received
Interest expense (lease)
Interest expenses (other)
Payments to suppliers and employees (inclusive of GST)
Grant and other income received
Net cash from/ (used in) operating activities
Cash flows from investing activities
Purchase of patents and trademarks
Purchase of plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares and options
Payment of lease (Principal)
Share issue costs
Unissued equity contributions received
Note
Note
2021
$
2020
$
4,845,102
4,025,173
32,144
(83,688)
(11,824)
14,390
(88,002)
-
(5,426,761)
(4,546,913)
700,005
562,090
54,978
(33,262)
(27,841)
(5,510)
(22,405)
(15,754)
(33,351)
(38,159)
-
(270,998)
(10,870)
-
750,000
(236,778)
(16,455)
300,000
15
21
14
13
18
15
18
19
Net cash provided by financing activities
(281,868)
796,767
Net increase/(decrease) in cash held
Cash and cash equivalents at the beginning of the year
Exchange rate adjustment for opening balance
(260,241)
1,920,657
50,138
725,346
1,208,496
(13,185)
Cash and cash equivalents at the end of the year
8
1,710,554
1,920,657
This Statement of Cash Flows is to be read in conjunction with the attached Notes.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 32
NOTES TO FINANCIAL STATEMENTS
For the Year Ended 30 June 2021
Note 1: Summary of significant accounting policies
The principal accounting policies adopted in the preparation of the financial report are set out below. 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.
The following is a summary of the material accounting policies adopted by the consolidated Group in the preparation of the
financial report. The accounting policies have been consistently applied to all years presented, unless otherwise stated.
Basis of preparation
The financial report is a general-purpose financial report that has been prepared in accordance with Australian Accounting
Standards and interpretations issued by the Australian Accounting Standards Board [“AASB’] and the Corporations Act 2001, as
appropriate for-profit oriented entities.
(i) Statement of compliance
These financial statements also comply with International Financial Reporting Standards (IFRS) as issued by the International
Accounting Standards Board [“IASB”].
(ii) Historical cost convention
•
•
•
The financial report has been prepared on an accrual basis under the historical cost convention.
The financial report is presented in Australian dollars, which is the Parent Company’s functional and presentational currency.
The financial statements have been approved and authorised for issue by the Board of Directors on the 18 August 2021.
Going concern
The consolidated entity incurred an operating cash inflow of $54,978 during the year ended 30 June 2021 (2020: outflow $33,262).
The total comprehensive loss for the year ended 30 June 2021 was $874,054 (2020: $1,344,520) and the cash on hand as at 30 June
2021 was $1,710,554.
The consolidated entity’s forecasts and projections for the next twelve months take into account the current status, operational
changes and projected future trading performance, and indicate that, in the directors’ opinion, the consolidated entity will be
able to operate as a going concern.
Principles of consolidation
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 23 to the financial statements. All Controlled Entities have a June financial year-
end.
All inter-company balances and transactions between Entities in the Consolidated Group, 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.
Goods and services tax (GST)
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.
Note 2: New accounting standards and interpretations
The Company has adopted all of the new or amended Accounting Standards and Interpretations issued by the AASB that are
mandatory for the current reporting period. Any new or amended Accounting Standards or Interpretations that are not yet
mandatory have not been early adopted.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 33
Note 3: Revenue and other income
Operating revenue
Sale of products
Services revenue
Other revenue
Interest received
Other income
Grants - R&D incentive
Grants – Others
COVID-19 Government subsidies
Foreign exchange gain
Sundry income
Total other income
Total revenues and other income from continuing operations
Disaggregation of revenue
The disaggregation of revenue from contracts with customers is as follows
2021
$
2020
$
3,847,920
10,161
3,407,932
71,826
31,738
13,540
443,395
87,190
134,000
-
405
664,990
4,554,810
468,454
36,433
96,500
190,041
-
791,428
4,284,726
2021
Sales of products
Services revenue
Total
Goods transferred at a point in time
Services transferred over time
Total
2020
Sales of products
Services revenue
Total
Goods transferred at a point in time
Services transferred over time
Total
Recognition and measurement
Australia
$
Asia
$
Americas
$
Europe
$
Other regions
$
Consolidated
$
87,972
8,843
96,815
87,972
8,843
96,815
5,386
13,567
18,953
5,386
13,567
18,953
2,445,977
-
2,445,977
2,445,977
-
2,445,977
2,415,770
16,396
2,432,166
2,415,770
16,396
2,432,166
225,532
201
225,733
225,532
201
225,733
524
149
673
524
149
673
991,284
1,117
992,401
991,284
1,117
992,401
681,956
41,714
723,670
681,956
41,714
723,670
97,155
-
97,155
97,155
-
97,155
304,296
-
304,296
304,296
-
304,296
3,847,920
10,161
3,858,081
3,847,920
10,161
3,858,081
3,407,932
71,826
3,479,758
3,407,932
71,826
3,479,758
Revenue is measured at the fair value of the consideration received or receivable. Amounts are disclosed as revenue net of returns,
discounts, allowances and goods and services tax (GST).
• Sale of goods
Revenue from the sale of goods is recognised when control of the products has transferred, being the point in time when the
products are delivered to the customer’s specified location, the amount of revenue can be measured reliably, and it is
probable that payment will be received by the Group.
• Revenue from rendering of services
Rendering of services consists of training, repair and product maintenance supplied 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.
• Research and developments tax incentive
R&D tax incentives are recognised when there is reasonable assurance that the entity will comply with the conditions attaching
to them and the rebates will be received. R&D tax incentives are recognised as income on a systematic basis over the periods
in which the entity recognises as expenses the related costs for which the rebates are intended to compensate.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 34
Note 4: Expenses from continuing activities
Depreciation and amortisation expenses
Impairment of patents
Depreciation – right-of-use assets
Employee benefits expense
Research and development expenses
Advertising and marketing expenses
Occupancy expenses
Auditors remuneration (audit and review)
Regulatory expenses
Administrative expenses
Exchange losses
Finance costs
Total expenses from continuing activities
Employee benefits expenses
2021
$
125,254
-
270,998
2,195,055
815,857
634,525
14,802
94,200
121,222
533,820
50,694
95,513
4,951,940
2020
$
320,225
231,185
249,507
2,017,014
809,998
681,578
56,977
95,861
140,718
470,949
-
89,896
5,163,908
Employer contributions to defined contribution superannuation plans are recognised as an expense in the profit or loss as they
are paid or payable. Refer to Note 17 for details on provisions for employee benefits. Share based expenses of $531,177 in 2021
(2020: $245,364) are included in employee benefits expenses above.
Research and development expenses
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.
Impairment of patents
Impairment of patents was $Nil in 2021 (2020: $231,185). Refer to Note 14 for details.
Note 5: Income tax
Major components of income tax
Current income tax
Income tax
Reconciliation between income tax credit and prima facie tax on accounting loss
Accounting loss before income tax
Tax benefit at 26% in Australia, 28% in USA, 11% in Hungary, 25% in China (2020: 27.5% in
Australia, 28% in USA, 11% in Hungary and 25% in China)
Tax effect on non-taxable income and non-deductible expenses
Temporary differences
Deferred tax asset not brought to account
Income tax
2021
$
(42,040)
(42,040)
2020
$
(17,146)
(17,146)
(882,203)
(1,314,189)
168,924
(288,003)
18,427
58,612
(42,040)
51,888
(179,607)
(47,532)
158,105
(17,146)
The consolidated entity currently has carried forward losses of $17.7m from prior years in respect to its Australian operations and
approximately $2.2m in respect to its American and Asia operations. The utilisation of these carried forward losses is conditional
on the consolidated entity meeting the conditions for deductibility imposed by the law in the period in which the consolidated
entity derives sufficient taxable income in order to utilise these losses. For the year ended 30 June 2021, management has
reviewed the deductibility of these losses in comparison to the estimated taxable income derived by the consolidated entity and
are confident that sufficient losses are available to offset the expected taxable income for the financial year ended 30 June 2021.
Whilst the consolidated entity has continued to trade positively due to the COVID-19 induced demand, it is currently not known
with sufficient probability how the consolidated entity’s trade will transpire for the FY22 period and beyond. As a consequence,
the consolidated entity has elected not to recognise any deferred tax assets or carried forward income tax losses.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 35
The table below has summarised the tax losses estimate derived from different jurisdictions.
2021
Tax losses
Tax credit
2020
Tax losses
Tax credit
Note 6: Accumulated Losses
Australia
$
USA
$
Hungary
$
China
$
Singapore
$
Total
$
17,780,922
4,623,040
1,625,613
454,905
360,068
39,608
(217,466)
(54,367)
197,520
33,578
19,746,657
5,096,764
18,442,341
4,795,009
1,370,763
383,589
390,680
42,975
(55,453)
(13,864)
-
-
20,148,331
5,207,709
Accumulated losses at the beginning of the financial year
Loss for the 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)
2021
$
(34,016,125)
(924,243)
(34,940,368)
2020
$
(32,684,790)
(1,331,335)
(34,016,125)
2021
$
(924,243)
Number
2020
$
(1,331,335)
Number
148,066,517
145,211,920
-
1,114,415
-
450,000
149,180,932
145,661,920
(0.6)
(0.6)
(0.9)
(0.9)
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
Note 8: Cash and cash equivalents
Cash on hand
Bank: Cheque accounts
Bank: Cash management
Bank: Term deposits
Total cash and cash equivalents
2021
$
226
1,668,498
26,615
15,215
1,710,554
2020
$
66
1,853,415
51,972
15,204
1,920,657
Cash at bank and on hand bears floating interest rates. The interest rate relating to cash and cash equivalents for the year was
between 0.05% and 0.75% (2020: between 0.15% and 0.85%)
Note 9: Trade and other receivables
Current
Trade receivables (a)
Other receivables (b)
Total current receivables
2021
$
225,032
179,335
404,367
2020
$
271,761
181,939
453,700
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.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 36
a. Past due but not impaired and impairment of receivables
Trade receivables are non-interest bearing and on an average of 45-day terms. Customers with balances past due without
provisions for impairment of receivables amount to $Nil as at 30 June 2021 ($Nil as at 30 June 2020). The company has recognised
a loss of $NIL (2020: $NIL) in profit and loss in respect of impairment of receivables for the year ended 30 June 2021.
The group applies the AASB 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss
allowance for all trade receivables. The ECL assessment completed by the Group as at 30 June 2021 has resulted in an immaterial
credit loss and no impairment allowance has been recognised by the Group (2020: $Nil).
b. Other receivables
These amounts related to prepayments, accrued interest and net GST refunds receivable. None of these receivables are impaired
or past due but not impaired.
c. Fair value and credit risk
Due to the short-term nature of these receivables, their carrying value is assumed to approximate their fair value.
Information about the company’s exposure to fair value and credit risk in relation to trade and other receivables is provided in
Note 22.
Note 10: Inventories
Current inventories at cost
Raw materials
Finished products
Total inventories
2021
$
657,832
237,045
894,877
2020
$
511,617
317,236
828,853
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. Net realisable value is the estimated selling price in the ordinary course of business less
the estimated costs of completion and the estimated costs necessary to make the sale.
Note 11: Tax asset
Income tax credit/(expense)
R & D tax incentive
Total tax asset
Income tax
2021
$
(26,717)
468,000
441,283
2020
$
15,486
459,623
475,109
Income taxes are accounted for using the Balance Sheet liability method whereby:
• The tax consequences of recovering (settling) all assets (liabilities) are reflected in the financial 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.
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.
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.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 37
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 in 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.
R & D tax incentive
The Consolidated Entity is eligible for a research and development (R&D) grant which is received on an annual basis after the
Australia Tax Office processes the group’s tax return. The amount of R&D grant receivable is accrued based on eligible expenses
incurred during the respective financial year.
Note 12: Trade and other receivables
Non-Current
Bank guarantee
Total other non-current assets
2021
$
83,456
83,456
The parent entity has provided a guarantee in respect of obligations under premises lease of $83,456 (2020: $83,456).
Note 13: 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
2021
$
747,956
(699,625)
48,331
175,712
(127,825)
47,887
43,338
(41,029)
2,309
59,456
(58,673)
783
2020
$
83,456
83,456
2020
$
743,157
(669,337)
73,820
175,712
(92,825)
82,887
43,338
(37,303)
6,035
58,760
(57,978)
782
Total plant and equipment
99,310
163,524
Movements in carrying amounts
Useful life
Plant and
equipment
2-7 years
$
Office furniture
and equipment
2-7 years
$
Computer
software
3 years
$
Low value
asset pool
3 years
$
Consolidated Entity
Carrying amount at 1 July 2020
Additions
Disposals
Depreciation expense
Effects of foreign currency exchange differences
Carrying amount at 30 June 2021
73,820
4,799
-
(30,287)
(1)
48,331
82,887
-
(749)
(34,251)
-
47,887
6,035
-
-
(3,728)
2
2,309
782
711
-
(710)
-
783
Total
$
163,524
5,510
(749)
(68,976)
1
99,310
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
- Plant & Equipment
- Office Furniture & Equipment
- Computer Software
- Low Value Pool
Depreciation Rate
20% - 25%
20%
25%
37.5%
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 38
Note 14: Intangible assets
Non-current
Patents at cost
Accumulated amortisation
Impairment
Carrying amount at 30 June
Regulatory approvals -acquisitions through business combinations
Accumulated amortisation
Carrying amount at 30 June
Total intangible assets
Movements in carrying amounts
Patents carrying amount at 1 July
Additions
Impairment
Amortisation
Patents carrying amount at 30 June
Regulatory approvals -acquisitions through business combinations
Additions
Impairment
Amortisation
Regulatory approvals carrying amount at 30 June
Recognition and Measurement
2021
$
2,002,579
(1,532,895)
-
469,684
630,730
(630,730)
-
469,684
498,121
27,841
-
(56,278)
469,684
-
-
-
-
-
2020
$
1,974,739
(1,245,433)
(231,185)
498,122
630,730
(630,730)
-
498,122
810,159
22,405
(231,185)
(103,257)
498,122
147,170
-
-
(147,170)
-
Intangibles are carried at cost less accumulated amortisation and impairment losses where applicable. Intangible assets acquired
separately are capitalised at cost or if arising from a business combination at fair value as at the date of acquisition.
Intangible Assets comprise Intellectual Property in the form of Patents and Regulatory approvals (NMPA, 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.
Patents and Trademarks are valued in the financial statements at cost of acquisition less accumulated amortisation and are
amortised on a diminishing value basis at 12.5% per annum.
Impairment of assets
Intangible assets are monitored by management at the level of the four operating segments identified in Note 26.
A segment-level summary of the intangible allocation is presented below:
2021
Patent from cardiovascular products
Less: Impairment provided
Total
2020
Patent from cardiovascular products
Less: Impairment provided
Total
Australia
$
Asia
$
Americas
$
Europe
$
Consolidated
$
36,975
-
36,975
40,537
-
40,537
74,095
-
74,095
76,719
-
76,719
-
-
-
231,185
(231,185)
-
358,614
-
358,614
380,866
-
380,866
469,684
-
469,684
729,307
(231,185)
498,122
The group tests whether intangible assets have suffered any impairment on an annual basis or any indications present that an
asset may be impaired. For the 2021 and 2020 reporting periods, the recoverable amount of the cash-generating units (CGUs)
was determined based on value-in-use calculations which require the use of assumptions. The calculations use cash flow
projections based on financial budgets approved by management covering a five-year period.
No impairment identified from the assessment in 2021 (2020: $231,185 impairment charge for Americas Territory of BP+ and 1A
products in response to poor economic conditions in the US).
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 39
Note 15: Right-of-use assets
Right-of-use assets
Lease liabilities - current
Lease liabilities – non current
Reconciliation of movement in lease liabilities:
Lease liability recognise at 1 July
Additions
Interest expense
Repayment of lease liabilities
Total lease liabilities as at 30 June
Note 16: Trade and other payables
Current
Trade payables
Sundry payables and accrued expenses
Employee related payables
Total payables
2021
$
1,231,438
(189,050)
(1,240,884)
1,617,244
-
83,688
(270,998)
1,429,934
2021
$
135,583
245,418
175,019
556,020
2020
$
1,493,980
(187,310)
(1,429,935)
1,620,535
145,485
88,002
(236,778)
1,617,244
2020
$
269,893
147,752
179,479
597,124
Trade and other payables represent the liability outstanding at the end of the reporting period for goods and services received
by the Group during the reporting period which remains unpaid. The balance is recognised as a current liability with the amount
being normally paid within 30 days of recognition of the liability.
The carrying amounts of the Group’s trade and other payables are denominated in Australian Dollars. For an analysis of the
financial risks associated with trade and other payable refer to Note 22.
Note 17: Provisions
Current
Provision for annual leave
Provision for long service leave
Non-current
Provision for long service leave
Provision for warranties
Provision for make good
(a) Aggregate employee benefits
(b) Movement in employee benefits
Balance at beginning of the year
Additional provision
Amounts used
Balance at end of the year
(c) Movement in warranties
Balance at beginning of the year
Additional provision
Amounts used
Balance at end of the year
(d) Movement in make good
Balance at beginning of the year
Additional provision
Amounts used
Balance at end of the year
2021
$
156,504
47,261
22,391
26,600
18,661
2020
$
173,280
40,705
27,549
21,550
17,604
226,156
241,535
241,535
142,701
(158,080)
226,156
21,550
8,850
(3,800)
26,600
17,604
1,256
-
18,860
185,411
134,879
(78,755)
241,535
12,700
11,894
(3,044)
21,550
15,718
1,886
-
17,604
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 40
Short term employee benefits
Short term employee benefits are employee benefits (other than termination benefits and 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, and profit sharing and bonuses payables within 12 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.
Long term employee benefits
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.
Warranties
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 reference to the Consolidated Entity’s history of warranty claims.
Lease Make Good
A provision for Lease Make Good is recognised in relation to the properties held under operating lease. The Group recognises
the provision for property leases which contain specific clauses to restore the property to a specific condition. The provision at
balance date represents management’s best estimate of the present value of the future make good costs required.
Note 18: Issued capital
Ordinary shares
Fully paid ordinary shares
Total contributed equity
Movement in issued capital
Shares on issue at the beginning of the year
Ordinary share issued for cash
Ordinary share issued for in lieu of salary
Share issue costs
Issued Equity at the end of the year
2021
Number
2020
Number
2021
$
2020
$
154,384,643
154,384,643
149,828,334
149,828,334
34,665,560
34,665,560
34,197,430
34,197,430
149,828,334
3,090,000
1,466,309
-
154,384,643
137,640,866
7,500,000
4,687,468
-
149,828,334
34,197,430
309,000
170,000
(10,870)
34,665,560
33,300,933
750,000
162,952
(16,455)
34,197,430
The Company’s authorised share capital amounted to 154,384,643 ordinary shares of no-par value at 30 June 2021.
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.
Note 19: 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.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 41
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.
Options and rights reserves (i)
Other equity reserves (ii)
Foreign currency translation reserves
Total reserves
(i) Movement in Performance rights reserve
Opening balance
Granted during the period (a)
Exercised during the period (b)
Lapsed during the period
Expenses from share-based payment
Rights at the end of the period
2021
Number
450,000
1,436,782
(300,000)
-
-
1,586,782
2020
Number
1,640,476
2,173,913
(3,364,389)
-
-
450,000
2021
$
3,268,249
-
84,157
3,352,406
2021
$
2,907,072
-
-
-
361,177
3,268,249
2020
$
2,907,072
300,000
33,968
3,241,040
2020
$
2,824,660
-
-
-
82,412
2,907,072
Total
1,586,782
450,000
3,268,249
2,907,072
(a) 1,436,782 Indeterminate rights were issued to Rob Phillips on the terms and conditions approved by shareholders at the AGM
on 29 October 2020 under the Equity Incentive Plan, vesting dependent on performance hurdles on 1 July 2021. Consideration
payable upon vesting is $nil. The Board exercised its discretion to pay cash in lieu of issue of ordinary shares. Upon meeting the
performance hurdles, a total of 1,436,782 rights were exercised on 5 July 2021 after the reporting date.
(b) 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.
300,000 of these performance rights were exercised on 28 August 2020.
Performance rights were issued during the year, pursuant to the Equity Incentive Plan. Fair values at grant date are determined
using a Black-Scholes Pricing Model that takes into account the exercise price, the term of the rights, the share price at the grant
date, the expected volatility of the underlying share, and risk-free interest rate for the term of the option. The model inputs for
options granted during the year ended 30 June 2021 are noted below:
Grant date
Vesting
date
29–Oct-20
01-Jul-21
Vesting
period
(moths)
8
Exercise
price
Share price
at issue date
Fair value at
issue date
Est.
volatility
Expected
dividend yield
Nil
$0.175
$0.175
122%
Nil
Average
risk-free
rate
0.23%
(ii) On 30 September 2020, the Company announced the private placement of shares to management and major shareholders.
Included in the placement was the issue of 3 million shares to the Company Executive Chairman Rob Philips at $0.10 per share.
The issue is conditional on shareholder approval which will be sought at the general meeting. An amount of $300,000 was received
by the company from Rob Philips as an advance on the placement which will be allocated to the allotted capital once approved.
In the event the shareholders reject the placement, the amount will be repaid to Rob Philips. On 29 October 2020, 3,090,000
shares at $0.10 per share were approved by the shareholders and issued to Rob Philips. This included 90,000 shares which were
on account of interest payable on the amount of $300,000.
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.
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 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.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 42
Note 20: Foreign currency translation reserve
Opening balance
Translation of financial statements of foreign Controlled Entities
Closing balance
2021
$
33,968
50,189
84,157
2020
$
47,153
(13,185)
33,968
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 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.
Note 21: Cash flow information
(a) Reconciliation of cash
Cash at bank and on hand
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
Depreciation on right-of-use assets
Share based payment expenses
FX Gain & Losses
Loss on disposal of PPE
(Increase)/decrease in assets
Trade debtors and other receivables
Other assets
Inventories
Tax credit
Increase/(decrease) in liabilities
Trade and other payables
Provision
Net cash from/ (used in) operating activities
Note 22: Financial instruments
a.
Significant accounting policies
2021
$
2020
$
1,710,554
1,710,554
1,920,657
1,920,657
(924,243)
(1,331,335)
68,129
56,283
-
270,998
531,177
50,693
1,595
46,729
(5,851)
(66,025)
75,868
(41,104)
(9,271)
54,978
69,798
250,427
231,185
249,507
245,364
(13,185)
-
311,545
(73,301)
(313,692)
(12,112)
285,677
66,860
(33,262)
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 1 to the financial statements.
b. Capital risk management
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) and equity attributable to equity holders
of the Parent Entity, comprising issued capital (Note 18), and accumulated losses (Note 6).
c. Outstanding contracts
At 30 June 2021, there were no outstanding contracts.
d.
Financial risk management objectives
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.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 43
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.
e.
Foreign currency risk management
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 2021 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 Chinese yuan. 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 creditors
Cash
Current trade debtors
Current trade creditors
Cash
Current trade debtors
Current trade creditors
Cash
Current trade debtors
Current trade creditors
2021
USD
152,050
-
22,211
HUF
2,459
3,249,184
10,224,208
EUR
159,251
25,428
10,679
NZD
-
-
18,447
CNY
5,338,138
614,800
16,700
2020
USD
407,288
234,335
28,582
HUF
2,459
4,090,988
6,893,267
EUR
50,975
22,045
5,902
NZD
-
-
18,767
CNY
4,076,199
925,000
-
f.
Foreign currency sensitivity
The Consolidated Entity is mainly exposed to exchange rate risks arising from movements in the US Dollar (USD), Euro (EUR),
New Zealand Dollar (NZD), Hungarian forint (HUF) and Chinese yuan (CNY) against the Australian Dollar (AUD), 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 USD, 5% movement of EUR, HUF and CNY rates against
the AUD 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% USD, 5% EUR, 5% HUF and 5% CNY
- decrease 10% USD, 5% EUR, 5% HUF and 5% CNY
g.
Interest rate risk management
2021
$
(296,417)
296,417
2020
$
(580,978)
580,978
The Consolidated Entity does not have any external loans or borrowings as at 30 June 2021 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.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 44
h.
Interest rate sensitivity
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.
Profit/Loss - increase 100 basis points
- decrease 100 basis points
i.
Credit risk management
2021
$
3,174
(3,174)
2020
$
1,354
(1,354)
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 outstanding but not impaired
0 - 45 days
46 – 90 days
Over 90 days
Total
2021
$
225,032
-
-
225,032
2020
$
271,761
-
-
271,761
No bad debt was written off during the year (2020: $Nil). There was no doubtful debt provision as at 30 June 2021 (2020: Nil). The
outstanding debts $225,032 are not past due to the reporting date. The group applies the AASB 9 simplified approach to
measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables. Details included in
Note9.
j.
Liquidity risk management
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 following table details the Consolidated Entity’s remaining contractual maturity for its non-derivative liabilities. The table has
been drawn up based on the undiscounted cash flows expected to be received/paid by the Consolidated Entity.
Consolidated
2021
Trade creditors
Payables
Lease liabilities
Total financial liabilities
2020
Trade creditors
Payables
Lease liabilities
Total financial liabilities
Weighted
Average
effective
interest
Rate %
0.0
0.0
5.71
0.0
0.0
5.71
Fixed interest rate maturing
Floating
interest
Within 1
year
$
$
1 to 5
years
$
-
-
-
-
-
-
-
-
189,050
189,050
-
-
1,240,884
1,240,884
-
-
187.310
187.310
-
-
1,429,934
1,429,934
Non-interest
bearing
$
135,583
175,019
-
310,602
269,893
179,479
-
449,372
Total
$
135,583
175,019
1,429,935
1,740,537
269,893
179,479
1,617,244
2,066,616
The carrying amounts of financial assets and financial liabilities recorded at cost approximate their fair values.
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 45
Note 23: 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 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:
Uscom Kft
Hungary
100%
Significant investments in subsidiaries:
Country of subsidiary incorporation:
Proportion of ownership interest:
Beijing Uscom Consulting Co. LTD
China
100%
Significant investments in subsidiaries:
Country of subsidiary incorporation:
Proportion of ownership interest:
Uscom SNG Pte. Ltd.
Singapore
100%
Consolidated
The Parent and Ultimate Parent Entity is Uscom Limited.
Key management personnel
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:
Non-Executive Directors
Christian Bernecker, Non-Executive Director
Brett Crowley, Non-Executive Director
Xianhui Meng, Non-Executive Director
Executive Directors
Rob Phillips, Executive Director, Chairman, Chief Executive Officer
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 18.
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
Long-term benefits
Share-based payment
Total key management personnel remuneration
2021
$
580,405
21,941
23,970
381,176
1,007,492
2020
$
528,048
21,276
15,603
82,412
647,339
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 46
Note 24: Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of comprehensive income
Loss after income tax
Total comprehensive income
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Contributed equity
Options reserve
Accumulated losses
Total equity
Contingent liabilities
2021
$
2020
$
(1,174,054)
(1,174,054)
3,038,760
3,697,636
552,387
620,039
34,665,560
3,268,249
(34,856,211)
3,077,598
(1,044,519)
(1,044,519)
3,709,591
4,515,814
1,026,764
1,093,469
34,197,430
2,907,072
(33,682,157)
3,422,345
The parent entity has provided a guarantee in respect of obligations under premises lease of $83,456 (2020: $83,456). 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 2021 or 30 June
2020.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in Note 1.
Note 25: Auditors’ remuneration
Audit services
BDO Audit Pty Limited for audit and review of financial reports
BDO Hungary for audit and review of financial reports
Total remuneration for audit services
Note 26: Operating segments
Segment information
2021
$
82,200
12,000
94,200
2020
$
85,650
10,211
95,861
The Consolidated Entity operates in the global health and medical products industry.
The Consolidated Entity sells two cardiovascular products, the USCOM 1A cardiac output monitor and the Uscom BP+ central
blood pressure monitor and a series of pulmonary products the Uscom SpiroSonic spirometers.
Globally the Company has five geographic sales and distribution segments Australia, Asia, the Americas, Europe and Middle 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 approximately 64% of the total sales. For the current period USCOM
1A comprised 77%, SpiroSonic spirometers 19% and BP+ 4% of the total Uscom sales revenue.
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 1 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
ANNUAL REPORT 2021
USCOM LIMITED
F I N A N C I A L R E P O R T
P a g e | 47
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
$
Asia
$
Americas
$
Europe
$
Consolidated
$
2021
Sales to external customers
Other income/revenue
Total segment revenue/income
Segment expenses
Segment result
Income tax
Consolidated loss from ordinary
activities after income tax
Segment assets
Segment liabilities
Acquisition of plant and
equipment and intangibles
Depreciation and amortisation
2020
Sales to external customers
Other income/revenue
Total segment revenue/income
Segment expenses
Segment result
Income tax
Consolidated loss from ordinary
activities after income tax
Segment assets
Segment liabilities
Acquisition of plant and
equipment and intangibles
Depreciation and amortisation
Note 27: Contingencies
193,970
591,600
785,570
3,058,217
(2,272,647)
-
2,445,977
27,932
2,473,909
987,430
1,486,479
(5,391)
(2,272,647)
1,481,088
3,485,014
1,936,777
19,985
245,055
323,249
569,636
892,885
3,987,506
(3,094,621)
-
1,404,351
127,210
-
68,260
2,432,166
8,854
2,441,020
380,102
2,060,917
-
(2,602,412)
1,707,269
3,902,217
2,405,208
9,629
1,380,020
16,535
-
225,733
-
225,733
393,364
(167,631)
-
(167,631)
115,057
66,070
1,640
-
673
190,041
190,714
413,760
(223,046)
-
(191,158)
43,439
41,711
18,024
317,828
26,895
310,568
992,401
77,197
1,069,598
998,002
71,596
(36,649)
34,947
330,546
127,314
11,725
82,936
723,670
36,438
760,108
817,547
(227,888)
(17,146)
(245,034)
591,425
31,603
10,505
145,629
3,858,081
696,729
4,554,810
5,437,014
(882,203)
(42,040)
(924,243)
5,334,969
2,257,371
33,350
396,252
3,479,758
804,969
4,284,726
5,598,915
(1,314,189)
(17,146)
(1,331,335)
5,917,401
2,495,057
38,159
800,917
Other than the guarantee mentioned at Note 24, the consolidated entity did not have any contingent liabilities as at 30 June 2021
or 30 June 2020.
Note 28: 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.
Impact of COVID-19
The effect of COVID-19 on future results of Uscom is difficult to predict. The impact on Uscom operations is twofold:
1. Reduced sales: with regional shutdowns and “on again, off again” sales appointments, sales are likely to be negatively
impaired, resulting in reduced sales across all devices. The degree of impairment is dependent on the extent and severity of
the current infections, and the effect of any additional new mutations. Great scientists are grappling with prediction of the
outcome of the pandemic with predictions ranging from recovery in 3 months to persistent disruption foreseeably. Uscom
management are watching intently for any reliable indicators of diminished sales which may warrant adjustment of our current
operational strategy.
Increased sales: the USCOM 1A has been recommended as the preferred method for management of severe COVID by the
Chinese National Health and Medical Commission, and by the Wuhan Pediatric and adult ICU Societies, and we are listed in
the International Pediatric Sepsis Guidelines as a means of treating sepsis in pediatrics, which is the fatal complication of
COVID. China has already purchased 50 units and installed them in specialised infectious disease hospitals, with more to
come.
2.
Uscom SpiroSonic devices are also useful to monitor the effective lung function of acutely infected subjects, and to monitor the
post COVID complications of pulmonary fibrosis. The application of these devices can be in the hospital or in home care.
The number of increased sales is difficult to determine and will vary from jurisdiction to jurisdiction but Uscom management are
watching intently for reliable indicators of increased demand which may warrant adjustment of our current operational strategy.
ANNUAL REPORT 2021
USCOM LIMITED
DIRECTORS DECLARATION
Uscom Limited and its Controlled Entity
P a g e | 48
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 2021 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:
Professor Rob Phillips
Chairman
18 August 2021
ANNUAL REPORT 2021
USCOM LIMITED
P a g e | 49
INDEPENDENT AUDIT REPORT
Tel: +61 2 92514100
Fax:+6 1 2 92409821
w w w.b do.c om.au
Level11, 1 Margaret St
Sydney NSW 2000
Australia
INDEPENDENT AUDITOR'S REPORT
To the members of Uscom Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Uscom Limited (the Company) and its subsidiaries (the Group),
which comprises the consolidated statement of financial position as at 30 June 2021, the consolidated
statement of profit or loss and other comprehensive income, the consolidated statement of changes in
equity and the consolidated statement of cash flows for the year then ended, and notes to the
financial report, including a summary of significant accounting policies and the directors’ declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its
financial performance for the year ended on that date; and
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
BDO Audit Pty Ltd ABN 33 134 022 870 is a member of a national association of independent entities w hich ar e all member s of BDO
Austr alia Ltd ABN 77 050 110 275, an Austr alian company limited by guar antee. BDO Audit Pty Ltd and BDO Austr alia Ltd ar e member s of
BDO Inter nationalLtd, a UK company limited by guar antee,and for m par t of the inter national BDO netw or kof independent member
fir ms. Liability limited by a scheme appr oved under Pr ofessional Standar ds Legislation.
ANNUAL REPORT 2021
USCOM LIMITED
I N D E P E N D E N T A U D I T R E P O R T
P a g e | 50
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
Impairment and carrying value of intangible assets
Key audit matter
How the matter was addressed in our audit
As disclosed in Note 14 Intangibles
Asset of the financial report, the
carrying value of intangible assets was
considered significant to our audit as
the carrying value of $469,684 at 30
June 2021 is material to the financial
statements and requires considerable
judgement and estimation by
management based on increasing
uncertain outcomes of regulatory
approvals in all jurisdictions as well as
the unpredictable effect of COVID-19
on future results of Uscom. The
intangible assets relate to patents held
in connection with the BP+ and Uscom
1A products.
Our audit procedures include amongst other:
•
•
•
•
•
•
•
•
Evaluated management’s assessment of the impact
of the COVID-19 pandemic on the Group to assess
any impairment indicators present according to
AASB 136 impairment of assets.
Critically reviewed the Value -in-Use (‘VIU’) models
prepared by management based on the identified
cash generating units (‘CGUs’) through challenging
and testing the following key assumptions:
o Growth on sales volume and price;
Budgeted gross margin;
o
o Other operating costs; and
Long-term growth rate
o
Re-performed the valuation assessment of growth
rates, terminal values and discount factors used in
discounted cash flow valuations based on BDO
sensitised results.
Together with BDO valuation specialists, assessed
the reasonableness of the discount rate applied by
management across the different CGUs.
Reviewed the regulation process for NMPA and FDA
approvals for the BP+ and SpiroSonic device, as
well as reasonableness on timing reflected in the
revenue forecast associated with those products.
Reviewed the accuracy of the impairment models
calculations, especially concerning the formula
applied to the calculation of the terminal values
for each CGU.
Reviewed patents for appropriate amortisation
rates and useful economic life.
Evaluated the adequacy of the impairment
disclosures in the financial report, particularly
those relating to intangible assets and to
judgements and estimates.
ANNUAL REPORT 2021
USCOM LIMITED
I N D E P E N D E N T A U D I T R E P O R T
P a g e | 51
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2021, but does not include the
financial report and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in directors’ report for the year ended 30 June
2021.
In our opinion, the Remuneration Report of Uscom Limited, for the year ended 30 June 2021, complies
with section 300A of the Corporations Act 2001.
ANNUAL REPORT 2021
USCOM LIMITED
I N D E P E N D E N T A U D I T R E P O R T
P a g e | 52
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit Pty Ltd
John Bresolin
Partner
Sydney, 18 August 2021
ANNUAL REPORT 2021
USCOM LIMITED
P a g e | 53
SHAREHOLDERS INFORMATION
Additional information required by Australian Stock Exchange Listing Rules is as follows. This information is current
as at 31 July 2021.
Distribution schedules of shareholder
Holdings Ranges
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – 99,999,999,999
Total
Holders
Number
63
209
175
476
140
1,063
Ordinary Shares
Number
12,888
711,243
1,377,064
16,860,198
136,860,032
155,821,425
%
0.010
0.460
0.880
10.820
87.830
100.000
There were 168 holders of less than a marketable parcel of 3,333 ordinary shares.
Class of shares and voting rights
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
The names of the substantial shareholders listed in the holding company’s register as at 31 July 2021 are:
CITICORP NOMINEES PTY LIMITED
MR ROBERT ALLAN PHILLIPS
JETAN PTY LTD & JETAN PTY LTD
Twenty largest registered holders – ordinary shares
Balance as at 31 July 2021
CITICORP NOMINEES PTY LIMITED
MR ROBERT ALLAN PHILLIPS
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
JETAN PTY LTD
JETAN PTY LTD
EASTBOURNE ROAD PTY LTD
DONGJUN SUN
INVIA CUSTODIAN PTY LIMITED
MR DAVID LEROY BOYLES
MR JOHN LIONEL GLEESON
MRS CHRISTINE QUYE
MR RUTHERFORD JAMES BROWNE & MRS SHEBA ELIZABETH MARJORIE BROWNE
RAEWYN JANETTE LOVETT & STRUAN GRANT MCOMISH
MR CHRISTOPHER JAMES WERE & LOCKHART TRUSTEE SERVICES NO 17 LIMITED
TRENTHAM SUPER PTY LTD
QUERION PTY LTD
MR PERRY JULIAN ROSENZWEIG
MR DOUGLAS JAMES CAMERON
MAK PLANNING AND DESIGN PTY LTD
INVIA CUSTODIAN PTY LIMITED
Total
Total Securities
33,119,538
32,202,535
10,180,652
Ordinary Shares
Number
33,119,538
32,202,535
6,266,609
5,180,652
5,000,000
2,611,086
2,414,125
2,088,118
2,000,000
1,830,750
1,829,109
1,568,820
1,477,640
1,424,095
1,351,000
1,266,667
1,104,718
1,038,888
1,000,001
991,667
105,766,018
155,821,425
%
21.255
20.666
4.022
3.325
3.209
1.676
1.549
1.340
1.284
1.175
1.174
1.007
0.948
0.914
0.867
0.813
0.709
0.667
0.642
0.636
67.876
ANNUAL REPORT 2021
USCOM LIMITED
S H A R E H O L D E R S I N F O R M A T I O N
P a g e | 54
Registered office and principal place of office
Suite 2, Level 8, 66 Clarence Street
Sydney NSW 2000 Australia
Tel:
02 9247 4144
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
Tel:
Fax:
1300 737 760
1300 653 459
www.boardroomlimited.com.au
Stock exchange listing
Quotation has been granted for 155,821,425 ordinary shares of the Company as at 31 July 2021 on all Member Exchanges of the
Australian Stock Exchange Limited.
Unquoted securities
Rights over unissued shares as at 31 July 2021
150,000 rights over ordinary shares are on issue to an executive under the Equity Incentive Plan.
ANNUAL REPORT 2021
USCOM LIMITED
Uscom Limited
Level 8, 66 Clarence Street
Sydney, NSW 2000 Australia
+61 2 9247 4144
info@uscom.com.au
www.uscom.com.au
ASX:UCM