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Index to Financial Statements
Interim Financial Report
For the Half-Year Ended
corresponding period: half-year ended 31 December 2014)
Index to Financial Statements
| Consolidated Statement of Comprehensive Income (Unaudited) | 1 | |||
| Consolidated Balance Sheet (Unaudited) | 2 | |||
| Consolidated Statement of Changes in Equity (Unaudited) | 3 | |||
| Consolidated Statement of Cash Flows (Unaudited) | 4 | |||
| Notes to the Consolidated Financial Statements (Unaudited) | 5 |
Index to Financial Statements
Consolidated Statement of Comprehensive Income (Unaudited)
For the Half Year Ended 31 December 2015
| Note | 31 December 2015 | 31 December 2014 | ||||||||
| $ | $ | |||||||||
| OTHER INCOME | ||||||||||
| Miscellaneous income | 376,930 | |||||||||
| Grant income | 887,727 | 1,169,929 | ||||||||
| Gain on foreign exchange | 624,531 | |||||||||
| Interest income | 164,657 | 200,228 | ||||||||
| Total other income | 1,429,314 | 1,994,688 | ||||||||
| EXPENSES | ||||||||||
| Depreciation and amortisation | (1,026,367 | ) | (216,651 | ) | ||||||
| Research and development and intellectual property | (4,011,362 | ) | (4,892,399 | ) | ||||||
| Corporate administrative expenses | (4,180,666 | ) | (3,028,026 | ) | ||||||
| Share Based Payment to strategic investor | 9 | (47,468,071 | ) | |||||||
| Loss on foreign exchange | (497,711 | ) | ||||||||
| Finance cost | (8,199 | ) | (204,571 | ) | ||||||
| Changes in fair value of comparability milestone | 10 | (542,075 | ) | |||||||
| Net Change in fair value of financial liability | (278,904 | ) | (54,127 | ) | ||||||
| Loss before income tax | (56,584,041 | ) | (6,401,086 | ) | ||||||
| Income tax expense | 562,176 | |||||||||
| Loss for the half-year | (56,021,865 | ) | (6,401,086 | ) | ||||||
| Other Comprehensive Income | ||||||||||
| Exchange differences on the translation of foreign operations | 269,013 | 164,790 | ||||||||
| Other comprehensive income for the half-year, net of income tax | 269,013 | 164,790 | ||||||||
| Total comprehensive loss for the half-year | (55,752,852 | ) | (6,236,296 | ) | ||||||
| Loss is attributable to: | ||||||||||
| Owners of Prima BioMed Ltd | (56,021,865 | ) | (6,401,086 | ) | ||||||
| Total comprehensive loss is attributable to: | ||||||||||
| Owners of Prima BioMed Ltd | (55,752,852 | ) | (6,236,296 | ) | ||||||
| Loss per share for loss attributable to the ordinary equity holders of the company: | ||||||||||
| Basic and diluted loss per share (cents) | (2.86 | ) | (0.51 | ) |
The above consolidated statement of comprehensive income (unaudited) should be read in conjunction with the accompanying
Index to Financial Statements
Consolidated Balance Sheet (unaudited)
As at 31 December 2015
| Note | 31 December 2015 | 30 June 2015 | ||||||||
| $ | $ | |||||||||
| ASSETS | ||||||||||
| Current assets | ||||||||||
| Cash and cash equivalents | 25,483,419 | 6,759,615 | ||||||||
| Current receivables | 4 | 228,511 | 315,453 | |||||||
| Other assets | 7 | 644,522 | 948,003 | |||||||
| Total current assets | 26,356,452 | 8,023,071 | ||||||||
| Non-current assets | ||||||||||
| Plant and equipment | 5 | 115,562 | 297,957 | |||||||
| Intangible assets | 6 | 21,774,380 | 22,662,417 | |||||||
| Total non-current assets | 21,889,942 | 22,960,374 | ||||||||
| Total assets | 48,246,394 | 30,983,445 | ||||||||
| LIABILITIES | ||||||||||
| Current liabilities | ||||||||||
| Trade and other payables | 1,591,436 | 2,770,049 | ||||||||
| Borrowings | 8 | 1,508,473 | ||||||||
| Current tax payable | 21,903 | 20,837 | ||||||||
| Employee benefits | 64,810 | 80,304 | ||||||||
| Total current liabilities | 1,678,149 | 4,379,663 | ||||||||
| Non-current liabilities | ||||||||||
| Financial liability | 9 | 4,698,435 | ||||||||
| Deferred tax liability | 1,313,024 | 1,878,333 | ||||||||
| Employee benefits | 37,630 | 35,706 | ||||||||
| Total non-current liabilities | 6,049,089 | 1,914,039 | ||||||||
| Total liabilities | 7,727,238 | 6,293,702 | ||||||||
| Net assets | 40,519,156 | 24,689,743 | ||||||||
| EQUITY | ||||||||||
| Issued capital | 10 | 194,376,075 | 179,878,436 | |||||||
| Reserves | 62,621,368 | 5,267,729 | ||||||||
| Accumulated losses | (216,478,287 | ) | (160,456,422 | ) | ||||||
| Equity attributable to the owners of Prima BioMed Ltd | 40,519,156 | 24,689,743 | ||||||||
| Total equity | 40,519,156 | 24,689,743 |
The above consolidated balance sheet (unaudited) should be read in conjunction with the accompanying notes.
Index to Financial Statements
Consolidated Statement of Changes in Equity (unaudited)
For the Half Year Ended 31 December 2015
| Note | Issued Capital | Reserves | Accumulated Losses | Total | ||||||||||||||
| $ | $ | $ | $ | |||||||||||||||
| Balance at 1 July 2014 | 149,014,372 | 1,882,674 | (128,304,726 | ) | 22,592,320 | |||||||||||||
| Loss for the half-year | (6,401,086 | ) | (6,401,086 | ) | ||||||||||||||
| Other comprehensive income | 164,790 | 164,790 | ||||||||||||||||
| Total comprehensive income for the half-year | 164,790 | (6,401,086 | ) | (6,236,296 | ) | |||||||||||||
| Transactions with owners in their capacity as owners: | ||||||||||||||||||
| Contribution of equity, net of transaction cost | 4,121,675 | 4,121,675 | ||||||||||||||||
| Share based payment | 2,278,022 | 2,278,022 | ||||||||||||||||
| Employee share based payment | 214,740 | 214,740 | ||||||||||||||||
| Balance at 31 December 2014 | 153,136,047 | 4,540,226 | (134,705,812 | ) | 22,970,461 | |||||||||||||
| Balance at 1 July 2015 | 179,878,436 | 5,267,729 | (160,456,422 | ) | 24,689,743 | |||||||||||||
| Loss for the half-year | (56,021,865 | ) | (56,021,865 | ) | ||||||||||||||
| Other comprehensive income | 269,013 | 269,013 | ||||||||||||||||
| Total comprehensive income for the half-year | 269,013 | (56,021,865 | ) | (55,752,852 | ) | |||||||||||||
| Transactions with owners in their capacity as owners: | ||||||||||||||||||
| Contribution of equity, net of transaction cost | 13,479,739 | 13,479,739 | ||||||||||||||||
| Issue of convertible notes | 9 | 9,331,297 | 9,331,297 | |||||||||||||||
| Share based payment | 42,527 | 42,527 | ||||||||||||||||
| Share based payment to strategic investor | 9 | 47,468,071 | 47,468,071 | |||||||||||||||
| Employee share based payment | 1,017,900 | 242,731 | 1,260,631 | |||||||||||||||
| Balance at 31 December 2015 | 194,376,075 | 62,621,368 | (216,478,287 | ) | 40,519,156 |
The above consolidated statement of changes in equity (unaudited) should be read in conjunction with the accompanying notes.
Index to Financial Statements
Consolidated Statement of Cash Flows (Unaudited)
For the Half Year Ended 31 December 2015
| 31 December 2015 | 31 December 2014 | |||||||
| $ | $ | |||||||
| CASH FLOWS RELATED TO OPERATING ACTIVITIES | ||||||||
| Payments to suppliers and employees (inclusive of Goods and Service Tax) | (8,095,889 | ) | (7,415,460 | ) | ||||
| Interest received | 164,657 | 344,186 | ||||||
| Miscellaneous income | 376,929 | |||||||
| Tax paid | (2,066 | ) | ||||||
| Grant income | 887,727 | 392,393 | ||||||
| NET CASH (OUTFLOWS) FROM OPERATING ACTIVITIES | (6,668,642 | ) | (6,678,881 | ) | ||||
| CASH FLOWS RELATED TO INVESTING ACTIVITIES | ||||||||
| Payments for plant and equipment | (6,436 | ) | (46,848 | ) | ||||
| Proceeds from disposal of plant and equipment | 64,105 | |||||||
| Funds from maturity of term deposits | 9,000,000 | |||||||
| Payment for acquisition of subsidiary, net of cash acquired | (15,769,617 | ) | ||||||
| NET CASH (OUTFLOWS) / INFLOWS IN INVESTING ACTIVITIES | 57,669 | (6,816,465 | ) | |||||
| CASH FLOWS RELATED TO FINANCING ACTIVITIES | ||||||||
| Proceeds from borrowings | 3,290,988 | |||||||
| Repayment of borrowings | (1,508,473 | ) | ||||||
| Proceeds from issue of convertible notes | 13,750,828 | |||||||
| Proceeds from issues of shares and options | 13,761,076 | 1,043,838 | ||||||
| Share issue transaction costs | (281,336 | ) | (63,098 | ) | ||||
| NET CASH INFLOWS FROM FINANCING ACTIVITIES | 25,722,095 | 4,271,728 | ||||||
| NET (DECREASE) / INCREASE IN CASH AND CASH EQUIVALENTS | 19,111,122 | (9,223,618 | ) | |||||
| Effect on exchange rate on cash and cash equivalent | (387,318 | ) | 755,643 | |||||
| Cash and cash equivalents at the beginning of the half year | 6,759,615 | 14,200,042 | ||||||
| CASH AND CASH EQUIVALENTS AT THE END OF THE HALF YEAR | 25,483,419 | 5,732,067 |
The above consolidated statement of cash flows (unaudited) should be read in conjunction with the accompanying notes.
Index to Financial Statements
Notes to the financial statements
1. Summary of Significant Accounting Policies
a) Basis of Preparation
consolidated financial statements are a general purpose financial report prepared in accordance with the requirements of the Corporations Act 2001, Australian Accounting Standard AASB 134: Interim Financial Reporting, Australian Accounting
Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board.
The half-year report does not include full
disclosures of the type normally included in an annual report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of Prima as the annual report.
It is recommended that this financial report be read in conjunction with the annual financial report for the year ended 30 June 2015 and any public
announcements made by Prima BioMed Ltd and its controlled entities during the half-year in accordance with continuous disclosure requirements arising under the Corporations Act 2001.
International Financial Reporting Standards form the basis of Australian Accounting Standards adopted by the AASB. The half-year financial report complies
with International Accounting Standards ( IAS ) 34 Interim Financial Reporting as issued by the International Accounting Standards Board ( IASB ).
The accounting policies adopted are consistent with those of the previous financial year and corresponding half-year reporting period.
The unaudited half-year consolidated financial statements were approved for issue by the Board of Directors on May 27, 2016.
The company resolved not to declare any
dividends in the half-year ended 31 December 2015.
3. Segment Reporting
Identification of reportable operating segments
segments are reported in a manner consistent with internal reports which are reviewed and used by Management and the Board of Directors (who are identified as the Chief Operating Decision Makers ( CODM )). The Group operates in one
operating segment, being Cancer Immunotherapy.
Index to Financial Statements
Notes to the financial statements (continued)
3. Segment Reporting (continued)
Operating segment information
| 31 December 2015 | Cancer Immunotherapy $ | Unallocated $ | Consolidated $ | |||||||||
| Other Income | ||||||||||||
| Grant income | 887,727 | 887,727 | ||||||||||
| Interest income | 164,657 | 164,657 | ||||||||||
| Miscellaneous income | 376,930 | 376,930 | ||||||||||
| Total other income | 1,264,657 | 164,657 | 1,429,314 | |||||||||
| Result | ||||||||||||
| Segment result | (56,584,041 | ) | (56,584,041 | ) | ||||||||
| Loss before income tax expense | (56,584,041 | ) | (56,584,041 | ) | ||||||||
| Income tax expense | 562,176 | |||||||||||
| Loss after income tax expense | (56,021,865 | ) |
| 31 December 2014 | Cancer Immunotherapy $ | Unallocated $ | Consolidated $ | |||||||||
| Other Income | ||||||||||||
| Grant income | 1,169,929 | 1,169,929 | ||||||||||
| Gain on foreign exchange | 624,531 | 624,531 | ||||||||||
| Interest income | 200,228 | 200,228 | ||||||||||
| Total other income | 1,169,929 | 824,759 | 1,994,688 | |||||||||
| Result | ||||||||||||
| Segment result | (6,401,086 | ) | (6,401,086 | ) | ||||||||
| Loss before income tax expense | (6,401,086 | ) | (6,401,086 | ) | ||||||||
| Income tax expense | ||||||||||||
| Loss after income tax expense | (6,401,086 | ) |
4. Current Receivables
| 31 December 2015 | 30 June 2015 | |||||||
| $ | $ | |||||||
| Trade receivables | 116,354 | 165,310 | ||||||
| GST receivable | 112,157 | 150,143 | ||||||
| 228,511 | 315,453 |
Due to the short term nature of these receivables, the carrying value is assumed to be their fair value as at 31 December
Index to Financial Statements
Notes to the financial statements (continued)
5. Plant and Equipment
| Plant and Equipment | Computer | Furniture and fittings | Total | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| At 1 July 2014 | ||||||||||||||||
| Cost or fair value | 1,248,948 | 62,789 | 12,765 | 1,324,502 | ||||||||||||
| Accumulated depreciation | (701,967 | ) | (39,603 | ) | (5,668 | ) | (747,238 | ) | ||||||||
| Net book amount | 546,981 | 23,186 | 7,097 | 577,264 | ||||||||||||
| Year ended 30 June 2015 | ||||||||||||||||
| Opening net book amount | 546,981 | 23,186 | 7,097 | 577,264 | ||||||||||||
| Exchange differences | (681 | ) | 1,128 | (22 | ) | 425 | ||||||||||
| Additions | 44,627 | 4,201 | 48,828 | |||||||||||||
| Disposal | (178 | ) | (5,332 | ) | (5,510 | ) | ||||||||||
| Acquisition of subsidiary | 787 | 1,937 | 2,724 | |||||||||||||
| Depreciation charge | (308,719 | ) | (14,523 | ) | (2,532 | ) | (325,774 | ) | ||||||||
| Closing net book amount | 282,817 | 10,597 | 4,543 | 297,957 | ||||||||||||
| At 1 July 2015 | ||||||||||||||||
| Cost or fair value | 605,648 | 28,016 | 7,172 | 640,836 | ||||||||||||
| Accumulated depreciation | (322,831 | ) | (17,419 | ) | (2,629 | ) | (342,879 | ) | ||||||||
| Net book amount | 282,817 | 10,597 | 4,543 | 297,957 | ||||||||||||
| Half Year ended 31 December 2015 | ||||||||||||||||
| Opening net book amount | 282,817 | 10,597 | 4,543 | 297,957 | ||||||||||||
| Exchange differences | 10,363 | 323 | 122 | 10,808 | ||||||||||||
| Additions | 5,722 | 714 | 6,436 | |||||||||||||
| Disposal | (61,308 | ) | (61,308 | ) | ||||||||||||
| Acquisition of subsidiary | ||||||||||||||||
| Depreciation charge | (131,437 | ) | (5,524 | ) | (1,370 | ) | (138,331 | ) | ||||||||
| Closing net book amount | 100,435 | 11,118 | 4,009 | 115,562 | ||||||||||||
| At 31 December 2015 | ||||||||||||||||
| Cost or fair value | 237,933 | 16,880 | 5,453 | 260,266 | ||||||||||||
| Accumulated depreciation | (137,498 | ) | (5,762 | ) | (1,444 | ) | (144,704 | ) | ||||||||
| Net book amount | 100,435 | 11,118 | 4,009 | 115,562 |
Index to Financial Statements
Notes to the financial statements (continued)
6. Non-current assets intangibles
| Patents | Intellectual Property | Goodwill | Total | |||||||||||||
| $ | $ | $ | $ | |||||||||||||
| At 1 July 2014 | ||||||||||||||||
| Cost | 1,915,671 | 1,915,671 | ||||||||||||||
| Accumulated amortisation | (1,798,788 | ) | (1,798,788 | ) | ||||||||||||
| Net book amount | 116,883 | 116,883 | ||||||||||||||
| Year ended 30 June 2015 | ||||||||||||||||
| Opening net book amount | 116,883 | 116,883 | ||||||||||||||
| Acquisition of Immutep S.A | 23,451,000 | 109,962 | 23,560,962 | |||||||||||||
| Amortisation charge | (55,002 | ) | (960,426 | ) | (1,015,428 | ) | ||||||||||
| Closing net book amount | 61,881 | 22,490,574 | 109,962 | 22,662,417 | ||||||||||||
| At 1 July 2015 | ||||||||||||||||
| Cost or fair value | 1,915,671 | 23,451,000 | 109,962 | 25,476,633 | ||||||||||||
| Accumulated amortisation | (1,853,790 | ) | (960,426 | ) | (2,814,216 | ) | ||||||||||
| Net book amount | 61,881 | 22,490,574 | 109,962 | 22,662,417 | ||||||||||||
| Half Year ended 31 December 2015 | ||||||||||||||||
| Opening net book amount | 61,881 | 22,490,574 | 109,962 | 22,662,417 | ||||||||||||
| Amortisation charge | (8,841 | ) | (879,196 | ) | (888,037 | ) | ||||||||||
| Closing net book amount | 53,040 | 21,611,378 | 109,962 | 21,774,380 | ||||||||||||
| At 31 December 2015 | ||||||||||||||||
| Cost or fair value | 1,915,671 | 23,451,000 | 109,962 | 25,476,633 | ||||||||||||
| Accumulated amortisation | (1,862,631 | ) | (1,839,622 | ) | (3,702,253 | ) | ||||||||||
| Net book amount | 53,040 | 21,611,378 | 109,962 | 21,774,380 |
The group amortises intangible assets with a limited useful life using
the straight-line method over the following periods:
Index to Financial Statements
Notes to the financial statements (continued)
| Note | 31 December 2015 | 30 June 2015 | ||||||||
| $ | $ | |||||||||
| Current | ||||||||||
| Prepayments | (a) | 613,096 | 380,749 | |||||||
| Security Deposits | 31,189 | 21,224 | ||||||||
| Accrued interest | 237 | 3,955 | ||||||||
| Comparability milestone | (b) | 542,075 | ||||||||
| 644,522 | 948,003 |
8. Current liabilities - Borrowings
| 31 December 2015 | 30 June 2015 | |||||||
| $ | $ | |||||||
| Amounts payable to related parties | 1,071,523 | |||||||
| Other borrowings | 436,950 | |||||||
| 1,508,473 |
Dr Fr d ric Triebel provided an unsecured loan to the company of $1,071,523. Interest was charged on this loan
at the rate of 10% per annum and was repaid in full in August 2015.
Other borrowings relate to an interest-free loan advanced by France s
innovation agency, ANVAR, which was repaid in full in July 2015.
Index to Financial Statements
Notes to the financial statements (continued)
9. Non-Current financial liability
| 31 December 2015 | 30 June 2015 | |||||||
| $ | $ | |||||||
| Convertible note at fair value | 4,698,435 | |||||||
| 4,698,435 |
On 14 May 2015 the Company entered into a subscription agreement with Ridgeback Capital Investments (Ridgeback) to invest
in Convertible Notes and Warrants of the Company for cash consideration totaling $13,750,828, which was subject to shareholder approval at an Extraordinary General Meeting. Shareholder approval was received on 31 July 2015.
The 13,750,828 Convertible Notes issued have a face value of $1.00 per note, mature on 4 August 2025 and accrue interest at a rate of 3% per annum
which may also be converted into shares. Conversions may occur during the period (i) at least 3 months after the Issue Date and (ii) at least 15 business days prior to the maturity date into 50 ordinary shares of the Company per note
(subject to customary adjustments for rights or bonus issues, off market buybacks, issues at less than current market price, share purchase plan, dividend reinvestment plan at a discount, return of capital or dividend or other adjustment). If a
change of control event, delisting event or event of default has occurred, Ridgeback may elect to convert the notes into shares or repayment of principal and interest. The Convertible Notes rank at least equal with all present and future
unsubordinated and unsecured debt obligations of the Company and contain customary negative pledges regarding financial indebtedness, dividend payments, related party transaction and others.
8,475,995 Warrants were granted which are exercisable at a price of $0.025 per share on or before 4 August 2025. 371,445,231 Warrants were granted which
are exercisable at a price of $0.0237 per share on or before 4 August 2020. All warrants may be settled on a gross or net basis and the number of warrants or exercise price may be adjusted for a pro rata issue of shares, a bonus issue or
capital reorganisation. The Warrants do not confer any rights to dividends or a right to participate in a new issue without exercising the warrant.
addition to the above cash financing from Ridgeback, it was disclosed at the Extraordinary General Meeting explanatory memorandum that Ridgeback also provides the company with additional services, including:
As a result of the above, the additional benefits provided to Prima determine that the financing transaction, including the issue of warrants, is to be
accounted for as a Share-Based Payment and are expensed on the grant date in accordance with AASB 2. The value of the share-based payment to the strategic investor has been calculated by determining the fair value of the convertible note and
warrants at the time of EGM approval and deducting the net cash proceeds from Ridgeback.
| Fair value of Convertible Note | 45,851,305 | |||
| Fair value of Warrants | 15,367,594 | |||
| Less cash received | (13,750,828 | ) | ||
| Share based payment to strategic investor | 47,468,071 |
Index to Financial Statements
Notes to the financial statements (continued)
The fair value of the convertible notes has been estimated by an external
valuer using a combination of the Black-Scholes methodology for the conversion option component of the notes and a discounted cashflow valuation for the debt component of the note. Key terms of the note are included above. The following assumptions
which were based on market conditions that existed at the grant date:
| Assumption | Convertible notes | Rationale | ||
| Historic volatility | 85.0% | Based on the Company s historical volatility data | ||
| Share price | $0.051 | Closing market share price on 31 July 2015 | ||
| Risk free interest rate | 2.734% | Based on Australian Government securities yields which match the term of the convertible note | ||
| Risk adjusted interest rate | 15.0% | An estimate of the expected interest rate of a similar non-convertible note issued by the company | ||
| Dividend yield | 0.0% | Based on the Company s nil dividend history | ||
| Risk free rate | 2.734% | Based on 10 year Australian Government securities yield |
The fair value of the convertible note is allocated between a financial liability for the traditional note component of the