RNS Number:6937P
Virotec International Ld
12 September 2003
Preliminary final report
for the year ended 30 June 2003
(previous corresponding period is year ended 30 June 2002)
VIROTEC INTERNATIONAL LTD
ABN 81 004 801 398
This report is prepared in accordance with ASX listing rule 4.3A, and is based
on accounts which are in the process of being audited. It is expected that the
audited accounts will be available on or about 26 September 2003 and the annual
report will be sent to shareholders on or about 24 October 2003.
1. Results for announcement to the market
% change A$'000
Revenue from ordinary activities 8% 1,662
(Loss) from ordinary activities after tax attributable to 9.8% (5,619)
members
(Loss) for the period attributable to members 9.8% (5,619)
Final dividend per share - nil
For an explanation of the results please refer to the attached report from the
directors.
2. Statement of Financial Performance for the year ended 30 June 2003.
Consolidated
Note 2003 2002
A$ A$
Revenue from sale of goods 5(a) 44,563 97,819
Revenue from rendering of services 5(a) 1,018,031 800,047
Other revenues from operating activities 599,152 640,708
-------- --------
Total Revenue 5(a) 1,661,746 1,538,574
-------- --------
Depreciation and amortisation expenses 5(a) (310,714) (275,418)
Research and development expense 5(a) (2,745,764) (1,804,866)
Mining interests expense 5(a) (217,902) (489,839)
Employee costs and directors remuneration 5(a) (1,713,454) (1,291,421)
Other expenses from operating activities (2,292,636) (2,793,437)
-------- --------
Total Expenses 5(a) (7,280,470) (6,654,981)
-------- --------
Loss from ordinary activities before income (5,618,724) (5,116,407)
tax
Income tax related to operating loss - -
-------- --------
Net loss after income tax (5,618,724) (5,116,407)
-------- --------
Basic loss per share ($0.034) ($0.034)
-------- --------
This statement should be read in conjunction with the accompanying notes.
3. Statement of Financial Position as at 30 June 2003.
2003 2002
A$ A$
Current Assets
Cash assets 6,453,845 11,896,720
Receivables 132,814 178,435
Inventory - 16,884
Other 52,407 107,267
--------- ---------
Total current assets 6,639,066 12,199,306
--------- ---------
Non-current Assets
Receivables 541,807 555,781
Property, plant and equipment 1,224,854 1,266,714
Intangibles 746,651 849,635
--------- ---------
Total non-current assets 2,513,312 2,672,130
--------- ---------
Total assets 9,152,378 14,871,436
--------- ---------
Current Liabilities
Payables 633,263 780,347
Provisions 156,581 109,831
--------- ---------
Total current liabilities 789,844 890,178
--------- ---------
Non-Current Liabilities
Provisions 790,000 790,000
--------- ---------
Total non-current liabilities 790,000 790,000
--------- ---------
Total liabilities 1,579,844 1,680,178
--------- ---------
Net assets $7,572,534 $13,191,258
--------- ---------
Equity
Contributed equity 63,678,284 63,678,284
Accumulated losses (56,105,750) (50,487,026)
--------- ---------
Total equity $7,572,534 $13,191,258
--------- ---------
This statement should be read in conjunction with the accompanying notes.
4. Statement of Cash Flows for the year ended 30 June 2003.
Consolidated
Note 2003 2002
Cash flows from operating activities A$ A$
Cash receipts in the course of operations 1,063,652 907,088
Cash payments in the course of operations (4,101,676) (3,474,019)
Interest received 453,788 438,377
--------- ---------
Net cash used in operating activities (2,584,236) (2,128,554)
--------- ---------
Cash flows from investing activities
Payments for property, plant and equipment (254,309) (456,189)
Proceeds from sale of property, plant and equipment 68,464 28,650
Payment for exploration, evaluation & development (217,902) (309,839)
Payments for research & development (2,468,866) (1,804,866)
Refund / Payment for security deposits 13,974 (2,377)
--------- ---------
Net cash used in investing activities (2,858,639) (2,544,621)
--------- ---------
Cash flows from financing activities
Proceeds from issues of shares - 17,138,457
Share issue costs - (1,146,618)
-------- ---------
Net cash provided by financing activities - 15,991,839
-------- ---------
Net increase/(decrease) in cash held (5,442,875) 11,318,664
Cash at the beginning of the financial year 11,896,720 578,056
--------- ----------
Cash at the end of the financial year 6,453,845 11,896,720
--------- ----------
This statement should be read in conjunction with the accompanying notes.
5. Notes to the Financial Statements
5(a) Operating Loss from Ordinary Activities
Consolidated
2003 2002
A$ A$
REVENUE FROM ORDINARY ACTIVITIES
Revenue from operating activities
Sale of goods from operating activities 44,563 97,819
Rendering of services from operating 1,018,031 800,047
activities
Other revenue from operating activities
Interest received or due and receivable from 453,788 438,374
other parties
Sundry 76,900 49,893
Net foreign exchange gain - 123,791
Proceeds from sale of non-current assets 68,464 28,650
-------- --------
Total revenue from ordinary activities 1,661,746 1,538,574
-------- --------
EXPENSES FROM ORDINARY ACTIVITIES
Depreciation of:
- plant and equipment 152,932 142,782
- motor vehicles 4,261 3,015
- computer equipment 23,707 17,995
- office furniture and equipment 26,838 8,696
Amortisation of goodwill 102,984 77,235
Research & development expenditure 2,745,764 1,804,866
Mining interests costs 217,902 309,839
Cost of goods sold 20,348 129,865
Cost of rendering services 768,693 556,075
Lease rentals 92,727 116,343
Loss on disposal of non-current asset 88,431 65,427
Amounts set aside to provisions for
- Rehabilitation of mining tenements - 180,000
- Employee entitlements 46,750 33,259
Employee costs - administration and corporate 930,776 556,940
Legal Fees 363,742 586,010
Marketing expenses 259,633 311,276
Accounting and audit services 86,166 199,307
Net foreign exchange loss 131 -
Director remuneration 782,678 714,720
Other administration and corporate costs 566,007 815,636
------- -------
Total expenses from operating activities 7,280,470 6,654,981
------- -------
5(b) Earnings Per Share
2003 2002
Earnings reconciliation $ $
Net loss (5,618,724) (5,116,407)
Basic earnings (loss) (5,618,724) (5,116,407)
Number Number
Weighted average number of ordinary 163,193,841 150,430,225
shares used in the calculation of basic
loss per share
Basic and Diluted earnings per share ($0.034) ($0.034)
5(c) Issued Capital
2003 2002
A$ A$
ISSUED AND PAID UP CAPITAL
Opening balance 168,193,841 ordinary shares 63,678,284 48,140,623
issued (2002: 109,950,709 ordinary shares)
Add the following share issues:-
27,514,400 ordinary shares issued at - 10,570,861
GBP#0.14 (A$0.384) per share pursuant to a
prospectus issued in the United Kingdom
Options exercised at A$0.20 per share - 5,301,984
resulting in the issue of 26,509,919
ordinary shares
Options exercised at A$0.30 per share - 1,265,632
resulting in the issue of 4,218,773 ordinary
shares
Less share issue costs - (1,600,816)
------ ------
Closing balance 168,193,841 ordinary shares 63,678,284 63,678,284
issued and outstanding (2002: 168,193,841
ordinary shares)
OPTIONS 2003 2002
Number Number
The following share options are on issue at
30 June 2003:-
Exercisable on or before 30 November 2002 - 1,000,000
at A$0.75 each
Exercisable on or before 28 February 2003 - 10,000,000
at A$0.20 each
Exercisable on or before 31 August 2003 at 2,700,000 2,700,000
A$1.00 each
Exercisable on or before 30 November 2003 900,000 900,000
at A$1.00 each
Exercisable on or before 30 November 2003 700,000 850,000
at A$0.56 each
Exercisable on or before 28 February 2004 200,000 200,000
at A$0.47 each
Exercisable on or before 30 July 2005 at 1,100,000 1,100,000
A$1.00 each
Exercisable on or before 30 July 2005 at 150,000 150,000
A$0.47 each
Exercisable on or before 31 October 2005 at 400,000 400,000
A$0.61 each
Exercisable on or before 31 March 2005 at 100,000 -
A$0.30 each
Exercisable on or before 31 March 2006 at 750,000 -
A$0.50 each
------ ------
7,000,000 17,300,000
5(d) Retained Earnings
2003 2002
A$ A$
Accumulated losses at beginning of year (50,487,026) (47,370,619)
Net loss after income tax (5,618,724) (5,116,407)
Transfer from option reserve - 2,000,000
------ ------
Accumulated losses at end of year (56,105,750) (50,487,026)
5(e) Segments
INDUSTRY SEGEMENTS
Environmental Mining Research Unallocated Consolidated
Consulting Interests and
Development
2003 A$ A$ A$ A$ A$
External 1,018,031 44,563 - - 1,062,594
customer
revenue
Interest - - - 453,788 453,788
income
Other income - - - 145,364 145,364
Total 1,018,031 44,563 - 509,152 1,661,746
revenue
Depreciation 244,734 11,181 - 54,806 310,722
and
amortisation
Segment 4,604 (204,868) (2,745,764) (2,672,696) (5,618,724)
operating
results
Acquisitions 220,010 - - 33,895 253,905
of
non-current
assets
Segment 1,965,896 51,360 - 7,135,123 9,152,379
assets
Segment (165,495) (840,000) - (444,349) (1,449,844)
liabilities
2002
External 800,047 97,819 - - 897,866
customer
revenue
Interest - - - 438,374 438,374
income
Other income - - - 202,334 202,334
Total revenue 800,047 97,819 - 640,708 1,538,574
Depreciation 213,926 31,786 - 29,706 275,418
and
amortisation
Segment (26,084) (521,885) (1,804,866) (2,763,545) (5,116,407)
operating
results
Acquisitions 293,674 18,704 - 143,811 456,189
of
non-current
assets
Segment 1,961,787 135,990 - 12,773,660 14,871,437
assets
Segment (155,898) (840,000) - (684,281) (1,680,179)
liabilities
GEOGRAPHIC SEGMENTS
Australia North Europe Consolidated
and Asia America
2003 A$ A$ A$ A$
External customer 809,143 43,010 210,441 1,062,594
revenue
Interest income 453,788 - - 453,788
Other income 144,587 777 - 145,364
Total revenue 1,407,518 43,787 210,441 1,661,746
Depreciation and 309,076 873 773 310,722
amortisation
Segment operating (4,641,856) (440,427) (536,441) (5,618,724)
results
Acquisitions of 242,963 4805 6137 253,905
non-current assets
Segment assets 9,132,117 16,034 4,228 9,152,379
Segment liabilities (1,433,122) (16,283) (440) (1,449,845)
The consolidated entity operated predominantly in Australia in 2002 and
accordingly no comparatives are provided.
5(f) Notes to the Statements of Cash Flows
2003 2002
RECONCILIATION OF CASH A$ A$
Cash at bank 6,453,845 11,896,720
-------- --------
RECONCILIATION OF OPERATING LOSS AFTER
INCOME TAX TO NET CASH USED IN OPERATING
ACTIVITIES
Operating loss after income tax (5,618,724) (5,116,407)
Add non cash items:
Depreciation and amortisation 310,722 275,418
Loss on disposal of assets 19,966 65,427
Add/(less) items classified as investing/
financing activities
Net exploration expenditures written off 217,902 309,839
during the year
Net research and development costs written 2,370,566 1,804,866
off during the year
Changes in assets and liabilities:
Decrease/(increase) in receivables 45,621 9,229
Decrease/(increase) in prepayments 54,860 (88,269)
Decrease/(increase) in inventories 16,884 97,278
Increase/(decrease) in trade creditors 93,078 60,644
Increase/(decrease) in provisions (193,411) 453,420
-------- ---------
Net cash used by operating activities (2,584,236) (2,128,554)
-------- ---------
5(g) Subsequent Events
On 27 August 2003 the Company issued 25,000,000 ordinary shares at a price of
GBP??0.14 per share (approximately A$0.34), raising approximately A$8.2 million
after costs.
6. Net tangible assets per security
The net tangible asset backing per security as at 30 June 2003 was 4.1 cents per
share compared with 7.3 cents per share in the previous corresponding period.
7. Details of entities over which control has been gained or lost during
the period.
Not applicable.
8. Details of associates and joint venture entities.
Not applicable.
9. Report from Directors on the results
Environmental consulting
The environmental consulting operations generated revenue for the year of
$1,018,031 (2002: $800,047), an increase of 27% and returned a profit of $4,604
(2002: loss of $26,084).
The main focus of this area has been the marketing and commercial implementation
of the Technologies taking the concept through to customer acceptance. The
turnover for the year in this area was $309,140 (2002: $178,101) an increase of
74%. In this area the consolidated entity has expanded its network of strategic
partners that have the sales and marketing infrastructure to enable the
technologies to be more effectively marketed globally. Of particular
significance is the global strategic partnership entered into with the Hatch
Group a leading consulting, engineering, technologies, project and construction
management organization. They operate through a network of more than 64
permanent offices worldwide with more than 4,000 employees. The main benefits
from the work this year is expected to be generated in future years.
The consolidated entity also operated a specialised laboratory, which accounted
for $708,891 of the revenue noted above compared to $621,946 for the 2002. This
area is expected to continue to grow modestly over the ensuing years.
During the year the consolidated entity also licenced the HydroDecTM technology
from CSIRO. This technology has been developed over eight years and treats
organic contaminants (e.g. PCBs and Dioxins). It complements the BauxsolTM
Technology which deals with inorganic contaminants (e.g. heavy metals).
Research and development
The consolidated entity continued its research and development programme into
improving the efficiency of its BauxsolTM Technology, BaseconTM Technology and
potential new applications of these technologies into other industries.
Since the end of the previous financial year patent applications were lodged in
respect of the BaseconTM Technology, the ViroSewageTM Systems and for the
ViroPhosphateTM fertiliser, further evidence of the platform nature of the
Technology. As a further level of intellectual property protection Virotec
scientists also developed and copyrighted two computer models to determine the
most cost effective: -
a. Way to treat residue from any alumina refinery to make it
environmentally benign; and
b. BauxsolTM Reagent blend required for the treatment of sulphidic mine
wastes and acid sulphate soils.
During the financial year the consolidated entity incurred costs of $2,745,764
on research, development and patent applications which was expensed in
accordance with the consolidated entity's accounting policy.
Mining and Exploration
The consolidated entity continues to hold a number of mining leases on
prospective tenements. Work on these areas has been, and is planned to remain
the minimum required to protect the leases. During the financial year several
leases have been relinquished or sold by the Company.
During the financial year the consolidated entity incurred a loss of $204,868 on
its mining interests, which was expensed in accordance with the consolidated
entity's accounting policy
10. Basis of preparation
These financial reports have been compiled in accordance with
Australian Accounting Standards. There has been no changes in accounting
policies, and these reports are prepared on a consistent basis with the 2002
annual financial reports. The financial reports are currently in the process
of being audited. These financial reports are unlikely to be the subject to
dispute or qualification. The numbers presented are for the consolidated entity
namely the consolidation of Virotec International Ltd and its wholly owned
subsidiaries.
Signed:................................... Date: 12 September 2003
Angus Craig
Company Secretary
This information is provided by RNS
The company news service from the London Stock Exchange
END
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