Announcement PDF Appendix 4E Preliminary final report Appendix 4E Preliminary final report 1. Company details Name of entity ACTINOGEN LIMITED ABN or equivalent company reference Financial year ended (‘reporting period’) 14 086 778 476 2. Financial year ended (‘previous corresponding period’) 30 June 2015 30 June 2014 Results for announcement to the market Increase/ 30/06/2015 30/06/2014 (decrease) % Rev enues from ordinary activ ities Amount change ($) 153,429 181,204 -15% (27,775) 5,431,009 440,222 1134% 4,990,787 5,431,009 440,222 1134% 4,990,787 0.016 0.006 - - Loss from ordinary activ ities after tax attributable to members Net loss for the period attributable to members Net tangible asset/(deficiency) per share 3. Statement of comprehensive income Refer to attached financial statements. 4. Statement of financial position Refer to attached financial statements. 5. Statement of cash flows Refer to attached financial statements. 6. Statement of changes in equity Refer to attached financial statements. 7. Dividends/Distributions No dividends declared in current or prior year. 8. Details of dividend reinvestment plan Not applicable. Appendix 4E Preliminary final report 9. Details of entities over which control has been gained or lost during the period Actinogen Limited acquired 100% of the issued capital in Corticrine Limited on 1/12/2014. Refer to attached financial statements for further information. 10. Details of associates and joint venture entities Not applicable. 11. Any other significant information needed by an investor to make an informed assessment of the Company’s financial performance and financial position Refer to attached financial statements. 12. Foreign entities Not applicable. 13. Commentary on results and explanatory information Actinogen Limited (‘the Company’) incurred a net loss for the financial year ended 30 June 2015 of $5,431,009 (2014: $440,222). The largest contributor to the net loss during the year ended 30 June 2015 related to the Company’s approximate spend of $2,700,000 on research and development related-costs. This was in accordance with the proposed use of capital raising funds as disclosed in the Notice of Meeting issued to shareholders on 16 October 2014. A further $1,695,341 of the net loss balance related to non-cash transactions including: $1,490,020 of share-based payment expenses comprising the Director Placement Shares and the loan shares issued to Key Management Personnel during the year; and $205,321 of amortisation and depreciations charges to the profit and loss. In the attached report below, refer to the Directors’ Report and the financial statements for further information. 14. Audit This report is based on accounts which have been audited. Dr Bill Ketelbey Managing Director Sydney, New South Wales Date: Friday, 28 August 2015 ACTINOGEN LIMITED ABN 14 086 778 476 FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2015 ACTINOGEN LIMITED CONTENTS PAGE Contents Page Corporate Directory 2 Corporate Governance Statement 3 Directors’ Report 11 Lead Auditor’s Independence Declaration 36 Consolidated Statement of Comprehensive Income 37 Consolidated Statement of Financial Position 38 Consolidated Statement of Cash Flows 39 Consolidated Statement of Changes in Equity 40 Notes to the Financial Statements 41 Directors’ Declaration 73 Independent Auditor’s Report 74 Shareholder Information 76 ACTINOGEN LIMITED CORPORATE DIRECTORY Board of Directors Auditors Executiv e Chairman – Mr Martin Rogers Ernst & Young Managing Director – Dr Bill Ketelbey Ernst & Young Building Non-Executiv e Director – Dr Jason Lov eridge 11 Mounts Bay Road Non-Executiv e Director – Dr Anton Uv arov Perth W A 6000 Company Secretary Lawyers Company Secretary - Peter W ebse GTP Legal Lev el 1, 28 Ord Street Principal Place of Business / Registered Office W est Perth W A 6005 Lev el 9, Suite 1, 68 Pitt Street Sydney NSW 2000 Share Register Automic Registry Serv ices Postal Address Suite 1A, Lev el 1 PO Box 271 7 Ventnor Av enue W est Perth W A 6872 W est Perth W A 6005 Contact Details Actinogen Limited shares are listed on Telephone: 02 8964 7401 the Australian Stock Exchange (ASX) www.actinogen.com.au ASX Code: ACW ABN 14 086 778 476 Bankers National Australia Bank 1232 Hay Street W est Perth W A 6005 2 ACTINOGEN LIMITED CORPORATE GOVERNANCE STATEMENT _____________________________________________________________ This Corporate Governance Statement (“Statement”) outlines the key aspects of Actinogen Limited’s (‘Actinogen’ or ‘the Company’) governance framework and main governance practices. The Company’s charters, policies, and procedures are regularly reviewed and updated to comply with law and best practice. These charters and policies can be viewed on Actinogen’s website located at www.actinogen.com.au. This Statement is structured with reference to the Australian Securities Exchange Corporate Governance Council’s (“the Council’s”) “Principles of Good Corporate Governance and Best Practice Recommendations 3rd Edition” (“the Recommendations”). The Board of Directors has adopted the Recommendations to the extent that is deemed appropriate considering current the size and operations of the Company. Therefore, considering the size and financial position of the Company, where the Board considers that the cost of implementing a recommendation outweighs any potential benefits, those recommendations have not been adopted. This Statement was approved by the Board of Directors and is current as at 13 August 2015. Principle 1: Lay solid foundations for management and oversight Roles of the Board & Management The Board is responsible for evaluating and setting the strategic direction for the Company, establishing goals for management and monitoring the achievement of these goals. The Managing Director is responsible to the Board for the day-to-day management of the Company. The principal functions and responsibilities of the Board include, but are not limited to, the following: • Appointment, evaluation and, if necessary, removal of the Managing Director, any other executive directors, the Company Secretary and the Chief Financial Officer (if applicable) and approval of their remuneration; • Determining, in conjunction with management, corporate strategy, objectives, operations, plans and approving and appropriately monitoring plans, new investments, major capital and operating expenditures, capital management, acquisitions, divestitures and major funding activities; • Establishing appropriate levels of delegation to the Managing Director to allow the business to be managed efficiently; • Approval of remuneration methodologies and systems; • Monitoring actual performance against planned performance expectations and reviewing operating information at a requisite level to understand at all times the financial and operating conditions of the Company; • Monitoring the performance of senior management, including the implementation of strategy and ensuring appropriate resources are available; • Overseeing the management of business risks, safety, occupational health and environmental issues; • Satisfying itself that the financial statements of the Company fairly and accurately set out the financial position and financial performance of the Company for the period under review; • Satisfying itself that there are appropriate reporting systems and controls in place to assure the Board that proper operational, financial, compliance, risk management and internal control processes are in place and functioning appropriately; • Assuring itself that appropriate audit arrangements are in place in relation to the Company’s financial affairs; • Authorising the issue of any shares, options, equity instruments or other securities within the constraints of the Corporations Act and the ASX Listing Rules; and • Ensuring that the Company acts legally and responsibly on all matters and assuring itself that the Company has adopted, and that its practice is consistent with, a number of guidelines including: 3 ACTINOGEN LIMITED CORPORATE GOVERNANCE STATEMENT _____________________________________________________________ − Code of Conduct; − Continuous Disclosure Policy; − Diversity Policy; − Performance Evaluation Policy; − Procedures for Selection and Appointment of Directors; − Remuneration Policy; − Risk Management and Internal Compliance and Control Policy. − Securities Trading Policy; and − Shareholder Communications Policy. Subject to the specific authorities reserved to the Board under the Board Charter, the Board has delegated to the Managing Director responsibility for the management and operation of Actinogen. The Managing Director is responsible for the day-to-day operations, financial performance and administration of Actinogen within the powers authorised to him from time-to-time by the Board. The Managing Director may make further delegation within the delegations specified by the Board and is accountable to the Board for the exercise of those delegated powers. Further details of Board responsibilities, objectives and structure are set out in the Board Charter on the Actinogen Website. Board Committees The Board considers that the Company is not currently of a size, nor are its affairs of such complexity to justify the formation of separate committees at this time including audit, risk, remuneration or nomination committees, preferring at this stage of the Company’s development, to manage the Company through the full Board of Directors. The Board assumes the responsibilities normally delegated to the Audit, Risk, Remuneration and Nomination Committees. If the Company’s activities increase, in size, scope and nature, the appointment of separate committees will be reviewed by the Board and implemented if appropriate. Board Appointments The Company undertakes comprehensive reference checks prior to appointing a director, or putting that person forward as a candidate to ensure that person is competent, experienced, and would not be impaired in any way from undertaking the duties of director. The Company provides relevant information to shareholders for their consideration about the attributes of candidates together with whether the Board supports the appointment or re-election. The terms of the appointment of a non-executive director, executive directors and senior executives are agreed upon and set out in writing at the time of appointment. The Company Secretary The Company Secretary is accountable directly to the Board, through the Chairman, on all matters to do with the proper functioning of the Board, including agendas, Board papers and minutes, advising the Board and its Committees (as applicable) on governance matters, monitoring that the Board and Committee policies and procedures are followed, communication with regulatory bodies and the ASX and statutory and other filings. Diversity The Company has adopted a formal Diversity Policy and is committed to workplace diversity, with a particular focus on supporting the representation of women at the senior level of the Company and on the Company Board. The Company is currently in an early stage of its development and given that it currently has a limited number of employees, the application of measurable objectives in relation to gender diversity, at various levels of the Company’s business, is not considered to be appropriate nor practical. 4 ACTINOGEN LIMITED CORPORATE GOVERNANCE STATEMENT _____________________________________________________________ The Board will review this position on an annual basis and will implement measurable objectives as and when they deem the Company to require them. The proportion of women in the consolidated entity as at 13 August 2015 is as follows:    Women on the board: 0 of 4 (0%) Women in senior executive positions: 0 of 3 (0%) Women in the organisation: 2 of 7 (29%) The Company’s Diversity Policy is available on its website. Board & Management Performance Review On an annual basis, the Board conducts a review of its structure, composition and performance The annual review includes consideration of the following measures:       comparing the performance of the Board against the requirements of its Charter; assessing the performance of the Board over the previous 12 months having regard to the corporate strategies, operating plans and the annual budget; reviewing the Board’s interaction with management; reviewing the type and timing of information provided to the Board by management; reviewing management’s performance in assisting the Board to meet its objectives; and identifying any necessary or desirable improvements to the Board Charter. The method and scope of the performance evaluation will be set by the Board and may include a Board self-assessment checklist to be completed by each Director. The Board may also use an independent adviser to assist in the review. The Executive Chairman has primary responsibility for conducting performance appraisals of NonExecutive Directors, in conjunction with them, having particular regard to:       contribution to Board discussion and function; degree of independence including relevance of any conflicts of interest; availability for and attendance at Board meetings and other relevant events; contribution to Company strategy; membership of and contribution to any Board committees; and suitability to Board structure and composition. The Board conducts an annual performance assessment of the Managing Director against agreed key performance indicators. Board and management performance reviews were conducted during the financial year in accordance with the above processes. Independent Advice Directors have a right of access to all Company information and executives. Directors are entitled, in fulfilling their duties and responsibilities, to obtain independent professional advice on any matter connected with the discharge of their responsibilities, with prior notice to the Chairman, at Actinogen’s expense. Principle 2: Structure the board to add value Board Composition During the financial year and to the date of this report the Board was comprised of the following members: 5 ACTINOGEN LIMITED CORPORATE GOVERNANCE STATEMENT _____________________________________________________________ Mr Martin Rogers Dr Bill Ketelbey Dr Jason Loveridge Dr Anton Uvarov Dr Brendan de Kauwe Daniel Parasiliti Executive Chairman (appointed 1 December 2014) Managing Director (appointed 18 December 2014) Non-Executive Director (appointed 1 December 2014) Non-Executive Director (appointed 16 December 2013) Executive Chairman (appointed 23 September 2013, resigned 18 December 2014) Non-Executive Director (appointed 23 September 2013, resigned 1 December 2014) The Board currently consists of two Executive Directors being the Chairman and Managing Director, and two Non-Executive Directors. Actinogen has adopted a definition of 'independence' for Directors that is consistent with the Recommendations. The Company’s Executive Chairman, Mr Martin Rogers, is not an independent director, neither was the Company’s former Executive Chairman, Dr Brendan de Kauwe. The Board believes it is important to have the Chairman engaged in an executive capacity at this critical stage of the Company’s development. The Board values the insight and advice provided by Mr Rogers and considers that the materiality of his relationship is such that it does not interfere with his capacity to bring an independent judgment on issues before the Board and to act in the best interests of Actinogen and its security holders generally. The Board does not currently consist of a majority of independent directors. It had a majority of independent directors, being Dr Anton Uvarov and Mr Daniel Parasiliti up until the latter’s resignation in December 2014. Dr Anton Uvarov is the only current director considered to be independent. Dr Jason Loveridge is not considered to be independent as he was a substantial shareholder of the Company up to the completion of a capital raising by the Company in May 2015. Given the size of the Board and the nature and scale of the Company’s current operations the Board believes the presence of one independent director on the Board is sufficient. Board Selection Process The Board considers that a diverse range of skills, backgrounds, knowledge and experience is required in order to effectively govern the Actinogen. The Board believes that orderly succession and renewal contributes to strong corporate governance and is achieved by careful planning and continual review. The Board is responsible for the nomination and selection of directors. The Board reviews the size and composition of the Board regularly and at least once a year as part of the Board evaluation process. The Board has a skills matrix covering the competencies and experience of each member. When the need for a new director is identified, the required experience and competencies of the new director are defined in the context of this matrix and any gaps that may exist. Generally a list of potential candidates is identified based on these skills required and other issues such as geographic location and diversity criteria. Candidates are assessed against the required skills and on their qualifications, backgrounds and personal qualities. In addition, candidates are sought who have a proven track record in creating security holder value and the required time to commit to the position. Induction of New Directors and Ongoing Development New Directors are issued with a formal Letter of Appointment that sets out the key terms and conditions of their appointment, including Director's duties, rights and responsibilities, the time commitment envisaged, and the Board's expectations regarding involvement with any Committee work. An induction program is in place and new Directors are encouraged to engage in professional development activities to develop and maintain the skills and knowledge needed to perform their role as Directors effectively. 6 ACTINOGEN LIMITED CORPORATE GOVERNANCE STATEMENT _____________________________________________________________ Principle 3: Act ethically and responsibly The Company has implemented a Code of Conduct, which provides guidelines aimed at maintaining high ethical standards, corporate behaviour and accountability within the Company. All employees and Directors are expected to:          respect the law and act in accordance with it; maintain high levels of professional conduct; respect confidentiality and not misuse Company information, assets or facilities; avoid real or perceived conflicts of interest; act in the best interests of shareholders; by their actions contribute to the Company’s reputation as a good corporate citizen which seeks the respect of the community and environment in which it operates; perform their duties in ways that minimise environmental impacts and maximise workplace safety; exercise fairness, courtesy, respect, consideration and sensitivity in all dealings within their workplace and with customers, suppliers and the public generally; and act with honesty, integrity, decency and responsibility at all times. An employee that breaches the Code of Conduct may face disciplinary action including, in the cases of serious breaches, dismissal. If an employee suspects that a breach of the Code of Conduct has occurred or will occur, he or she must report that breach to the Company Secretary. No employee will be disadvantaged or prejudiced if he or she reports in good faith a suspected breach. All reports will be acted upon and kept confidential. Principle 4: Safeguard integrity in corporate reporting The Board as a whole fulfills to the functions normally delegated to the Audit Committee as detailed in the Audit Committee Charter. The Board is responsible for the initial appointment of the external auditor and the appointment of a new external auditor when any vacancy arises. Candidates for the position of external auditor must demonstrate complete independence from the Company through the engagement period. The Board may otherwise select an external auditor based on criteria relevant to the Company’s business and circumstances. The performance of the external auditor is reviewed on an annual basis by the Board. The Board receives regular reports from management and from external auditors. It also meets with the external auditors as and when required. The external auditors attend Actinogen's AGM and are available to answer questions from security holders relevant to the audit. Prior approval of the Board must be gained for non-audit work to be performed by the external auditor. There are qualitative limits on this non-audit work to ensure that the independence of the auditor is maintained. There is also a requirement that the audit partner responsible for the audit not perform in that role for more than five years. CEO Certifications The Board has received certifications from the CEO in connection with the financial statements for the Actinogen for the Reporting Period. The Company does not currently have a CFO. The certifications state that the declaration provided in accordance with Section 295A of the Corporations Act as to the integrity of the financial statements is founded on a sound system of risk management and internal control which is operating effectively. 7 ACTINOGEN LIMITED CORPORATE GOVERNANCE STATEMENT _____________________________________________________________ Principle 5: Make timely and balanced disclosure The Company has a Disclosure Policy which outlines the disclosure obligations of the Company as required under the ASX Listing Rules and Corporations Act. The policy is designed to ensure that procedures are in place so that the market is properly informed of matters which may have a material impact on the price at which Company securities are traded. The Board considers whether there are any matters requiring disclosure in respect of each and every item of business that it considers in its meetings. Individual Directors are required to make such a consideration when they become aware of any information in the course of their duties as a Director of the Company. The Company is committed to ensuring all investors have equal and timely access to material information concerning the Company. The Board has designated the Company Secretary as the person responsible for communicating with the ASX. The Executive Chairman, Managing Director and the Company Secretary are responsible for ensuring that: a) b) Company announcements are made in a timely manner, that announcements are factual and do not omit any material information required to be disclosed under the ASX Listing Rules and Corporations Act; and Company announcements are expressed in a clear and objective manner that allows investors to assess the impact of the information when making investment decisions. Principle 6: Respect the rights of security holders The Company recognizes the value of providing current and relevant information to its shareholders. The Company respects the rights of its shareholders and to facilitate the effective exercise of those rights the Company is committed to: • • • communicating effectively with shareholders through releases to the market via ASX, the company website, information mailed to shareholders and the general meetings of the Company; giving shareholders ready access to clear and understandable information about the Company; and making it easy for shareholders to participate in general meetings of the Company. The Company also makes available a telephone number and email address for shareholders to make enquiries of the Company. These contact details are available on the “contact us” page of the Company’s website. Shareholders may elect to, and are encouraged to, receive communications from Actinogen and Actinogen's securities registry electronically. The Company maintains information in relation to its Constitution, governance documents, Directors and senior executives, Board and committee charters, annual reports and ASX announcements on the Company’s website. Principle 7: Recognise and manage risk The Board is committed to the identification, assessment and management of risk throughout Actinogen's business activities. 8 ACTINOGEN LIMITED CORPORATE GOVERNANCE STATEMENT _____________________________________________________________ The Board is responsible for the oversight of the Company’s risk management and internal compliance and control framework. Responsibility for control and risk management is delegated to the appropriate level of management within the Company with the Managing Director having ultimate responsibility to the Board for the risk management and internal compliance and control framework. Actinogen has established policies for the oversight and management of material business risks. Actinogen's Risk Management and Internal Compliance and Control Policy recognises that risk management is an essential element of good corporate governance and fundamental in achieving its strategic and operational objectives. Risk management improves decision making, defines opportunities and mitigates material events that may impact security holder value. Actinogen believes that explicit and effective risk management is a source of insight and competitive advantage. To this end, Actinogen is committed to the ongoing development of a strategic and consistent enterprise wide risk management program, underpinned by a risk conscious culture. Actinogen accepts that risk is a part of doing business. Therefore, the Company’s Risk Management and Internal Compliance and Control Policy is not designed to promote risk avoidance. Rather Actinogen's approach is to create a risk conscious culture that encourages the systematic identification, management and control of risks whilst ensuring we do not enter into unnecessary risks or enter into risks unknowingly. Actinogen assesses its risks on a residual basis; that is it evaluates the level of risk remaining and considering all the mitigation practices and controls. Depending on the materiality of the risks, Actinogen applies varying levels of management plans. The Board has required management to design and implement a risk management and internal compliance and control system to manage Actinogen's material business risks. It receives regular reports on specific business areas where there may exist significant business risk or exposure. The Company faces risks inherent to its business, including economic risks, which may materially impact the Company’s ability to create or preserve value for security holders over the short, medium or long term. The Company has in place policies and procedures, including a risk management framework (as described in the Company’s Risk Management and Internal Compliance and Control Policy), which is developed and updated to help manage these risks. The Board does not consider that the Company currently has any material exposure to environmental or social sustainability risks The Company’s process of risk management and internal compliance and control includes:    identifying and measuring risks that might impact upon the achievement of the Company’s goals and objectives, and monitoring the environment for emerging factors and trends that affect those risks. formulating risk management strategies to manage identified risks, and designing and implementing appropriate risk management policies and internal controls. monitoring the performance of, and improving the effectiveness of, risk management systems and internal compliance and controls, including regular assessment of the effectiveness of risk management and internal compliance and control. The Board review’s the Company’s risk management framework at least annually to ensure that it continues to effectively manage risk. Management reports to the Board as to the effectiveness of Actinogen's management of its material business risks on at each meeting. 9 ACTINOGEN LIMITED CORPORATE GOVERNANCE STATEMENT _____________________________________________________________ Principle 8: Remunerate fairly and responsibly Actinogen’s Remuneration Policy was designed to recognise the competitive environment within which Actinogen operates and also emphasise the requirement to attract and retain high caliber talent in order to achieve sustained improvement in Actinogen’s performance. The overriding objective of the Remuneration Policy is to ensure that an individual’s remuneration package accurately reflects their experience, level of responsibility, individual performance and the performance of Actinogen. The key principles are to:       link executive reward with strategic goals and sustainable performance of Actinogen apply challenging corporate and individual key performance indicators that focus on both short-term and long-term outcomes motivate and recognise superior performers with fair, consistent and competitive rewards remunerate fairly and competitively in order to attract and retain top talent recognise capabilities and promote opportunities for career and professional development through employee ownership of Actinogen shares, foster a partnership between employees and other security holders The Board determines the Company’s remuneration policies and practices and assesses the necessary and desirable competencies of Board members. The Board is responsible for evaluating Board performance, reviewing Board and management succession plans and determines remuneration packages for the CEO, Non-Executive Directors and senior management based on an annual review. Actinogen’s executive remuneration policies and structures and details of remuneration paid to directors and senior managers are set out in the Remuneration Report. Non-Executive Directors receive fees (inclu