dye110831 - appendix 4e - preliminary final report

8/4/2019 DYE110831 - Appendix 4E - Preliminary Final Report

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Appendix 4EPreliminary Final Report

Dyesol Limited Page 1

Appendix 4E

Preliminary Final Reportto the Australian Stock Exchange

Part 1

Name of Entity Dyesol Limited

ABN 92 111 723 883

Financial Period Year ended 30 June 2011

Previous Corresponding Reporting Period Year ended 30 June 2010

Part 2 Results for Announcement to the Market

$000

Percentageincrease

/(decrease) overprevious

correspondingperiod

Revenue from continuing operations 1,413 (54%)

Loss after related income tax benefit (17,285) 20%

Net loss attributable to members of the parent entity (17,285) 20%

Dividends (distributions) Amount per security Franked amount per security

Final Dividend Nil Nil

Interim Dividend Nil Nil

Record date for determining entitlements to thedividends (if any) Not Applicable

Brief explanation of any of the figures reported above necessary to enable the figures to beunderstood:

Refer Part 9 for a commentary on the results for the year.


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Part 3 Contents of ASX Appendix 4E

Section Contents

Part 1 Details of entity, reporting period

Part 2 Results for announcement to the marketPart 3 Contents of ASX Appendix 4E

Part 4 Consolidated statements of comprehensive income

Part 5 Accumulated losses

Part 6 Consolidated statements of financial position

Part 7 Consolidated statements of cash flows

Part 8 Consolidated statements of changes in equity

Part 9 Commentary on results

Part 10 Revenue and expenses

Part 11 Notes to the statement of cash flows

Part 12 Details relating to dividends

Part 13 Earnings per share

Part 14 Net tangible assets per security

Part 15 Details of entities over which control has been gained or lost

Part 16 Issued securities

Part 17 Subsequent events

Part 18 Audit status


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Part 4 Consolidated Statements of Comprehensive Income

2011($)

2010($)

Revenue 1,413,302 3,042,021

Cost of sales (1,007,982) (2,209,965)

Gross profit 405,320 832,056

Other income from continuing operations 1,334,214 1,667,755

Technical Expenses (7,963,614) (5,857,464)

Administration and corporate expenses (8,805,552) (7,464,135)

Marketing expenses (2,366,781) (3,408,636)

Finance costs (71,264) (1,928)

Intellectual property expenses (568,658) (574,174)

Loss before income tax (18,036,335) (14,806,526)

Income tax benefit 751,784 434,314

Loss for the year (17,284,551) (14,372,212)

Other Comprehensive loss for the year, net of tax

Foreign currency translation difference (516,797) (380,353)

Total comprehensive Income for the year (17,801,348) (14,752,565)

Loss for the year is attributable toOwners of Dyesol Limited (17,284,604) (14,372,325)

Non-controlling interest 53 113

(17,284,551) (14,372,212)

Total comprehensive loss for the year is attributable to:

Owners of Dyesol Limited (17,801,459) (14,752,783)

Non-controlling interest 111 218

(17,801,348) (14,752,565)

Part 5 Accumulated losses

2011($)

2010($)

Accumulated losses at the beginning of the financialperiod (39,124,594) (24,752,269)

Loss for the financial period (17,284,604) (14,372,325)

Accumulated losses at the end of the financial period (56,409,198) (39,124,594)


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Part 6 Consolidated Statements of Financial Position

2011$

2010$

CURRENT ASSETS

Cash and cash equivalents 6,293,440 13,137,203

Trade and other receivables 1,072,240 1,812,122Inventories 1,616,814 1,958,102Other current assets 349,105 254,736

Total Current Assets 9,331,599 17,162,163

NON CURRENT ASSETS

Property, plant and equipment 2,868,517 3,982,204Intangible assets 8,491,256 7,985,300

Total Non Current Assets 11,359,773 11,967,504

TOTAL ASSETS 20,691,372 29,129,667

CURRENT LIABILITIES

Trade and other payables 3,103,407 2,940,000Interest-bearing liabilities 1,150,847 11,076Financial liabilities 1,163,032 -Provisions 216,269 202,166

Total Current Liabilities 5,633,555 3,153,242

NON CURRENT LIABILITIES

Other payables 184,727 -Interest-bearing liabilities - 464,437

Provisions 361,100 343,653Deferred tax liability 668,049 749,207

Total Non Current Liabilities 1,213,876 1,557,297

TOTAL LIABILITIES 6,847,431 4,710,539

NET ASSETS 13,843,941 24,419,128

EQUITY

Issued capital 66,848,603 61,483,094Reserves 3,403,395 2,059,598Accumulated losses (56,409,198) (39,124,594)

Capital and Reserves attributable to owners ofDyesol Limited

13,842,80024,418,098

Non-controlling interest 1,141 1,030

13,843,941 24,419,128


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Part 7 Consolidated Statements of Cash Flows

2011($)

2010($)

Cash flows from operating activities

Cash receipts from customers 1,897,420 2,006,935Cash payments to suppliers and employees (16,157,087) (15,059,357)Income tax rebate received 1,029,626 359,588

Interest received 160,188 225,891

Finance costs (20,784) (1,928)Grant received 2,121,601 1,563,232

Net cash used in operating activities (10,969,036) (10,905,639)

Cash flows from investing activities

Payments for plant and equipment (886,891) (692,188)Proceeds from sale of plant and equipment 163 -

Payments for intellectual property (50,000) (100,000)

Payments for product development costs (1,089,738) (975,761)Loans repaid by directors - 900,625

Loans to related parties (320,287) (300,000)Loans repaid by related parties 20,287 300,000

Net cash used in investing activities (2,326,466) (867,324)

Cash flows from financing activities

Proceeds from borrowings 1,543,842 462,484Repayment of borrowings (11,860) (10,871)Proceeds from the issue of shares 5,500,000 12,000,000Share issue costs (323,475) (628,593)

Net cash provided by financing activities 6,708,507 11,823,020

Net increase in cash held (6,586,995) 50,057

Cash at the beginning of the year 13,137,203 13,290,253

Foreign currency loss on cash held (256,768) (203,107)

CASH AT THE END OF THE YEAR 6,293,440 13,137,203


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ApPreliminary Fi


Part 8 Consolidated Statements of Changes in Equity

Reserves

Issuedcapital

Accumulatedlosses

Equity-settledbenefit

Foreigncurrency

translation

reserve

Total

Non-controlling

interestTotal equity

$ $ $ $ $ $ $

At 1 July 2009 49,125,087 (24,752,269) 1,706,855 (80,176) 25,999,497 812 26,000,309

Total comprehensive income for theyear

Loss for the year - (14,372,325) - - (14,372,325) 113 (14,372,212)

Other comprehensive income

Foreign currency translation reservedifferences - -

- (380,458) (380,458) 105 (380,353)

Total comprehensive income for theyear - (14,372,325) - (380,458) (14,752,783) 218 (14,752,565)

Transaction with owners, in theircapacity as owners

Contributions of equity, net oftransaction costs 11,338,007 - - - 11,338,007 - 11,338,007

Shares issued as consideration foracquisitions 1,020,000 - - - 1,020,000 - 1,020,000

Share-based payment expense - - 813,377 - 813,377 - 813,377

Total transactions with owners 12,358,007 - 813,377 - 13,171,384 - 13,171,384

At 30 June 2010 61,483,094 (39,124,594) 2,520,232 (460,634) 24,418,098 1030 24,419,128


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ApPreliminary Fi


Part 8 Consolidated Statements of Changes in Equity (Continue)

Reserves

Issuedcapital

Accumulatedlosses

Equity-settled

benefit

Foreigncurrency

translationreserve

Total

Non-controlling

interestTotal equity

$ $ $ $ $ $ $

Total comprehensive income for the year

Loss for the year (17,284,604) (17,284,604) 53 (17,284,551)

Other comprehensive income

Foreign currency translation reservedifferences

(516,855) (516,855) 58 (516,797)

Total comprehensive income for the year (17,284,604) (516,855) (17,801,459) 111 (17,801,348)

Transaction with owners, in their capacity asowners

Issue of shares 5,500,000 5,500,000 5,500,000

Transaction costs from issue of shares (296,574) (296,574) (296,574)

Issue of shares as share based payments 162,083 (162,083) -

Share based payment expenses 2,022,735 2,022,735 2,022,735

Total transactions with owners 5,365,509 1,860,652 7,226,161 7,226,161

At 30 June 2011 66,848,603 (56,409,198) 4,380,884 (977,489) 13,842,800 1,141 13,843,941


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Part 9 Commentary on Results

The Dyesol board and management challenge is threefold: (1) optimising the use of cash ascommercial opportunities expand, (2) exploiting the company's existing and developingintellectual property portfolio and (3) establishing long-term, exclusive, global, commercialcollaborations. On that score, we are very happy with our progress in FY2011 and are nowbeginning to see tangible evidence of our investment. Few companies, if any, have the

outstanding commercial prospects that Dyesol enjoys.

The increase in financial net loss by 20% to $17.28 million is attributable to a number offactors. The implementation of the Dyesol employee share ownership plan (ESOP) resulted inalmost half of the increased loss attributable to non-cash items. This is a key part of theboard's employee incentive and retention strategy. Other non-cash loss items of significanceinclude an increase in forex related losses as the Australian dollar continued to appreciateduring the period along with our international commitments. Increased cash loss items ofsignificance include those related to senior management changes (-$560k), milestone basedpayments to CSIRO (-$462k) and expenses related to increased business developmentactivity. The level of percentage subsidy from the Welsh Assembly Government also declinedas the three year project neared its successful completion in July 2011. Many of theseexpenses are either abnormally high or have a "one-off" character. This explanation isstrongly supported by the gradual decline and stabilisation in monthly cash burn over the past

six months - three months either side of the end of last financial year. As an offset, marketingrelated expenses fell by a commensurate amount as related travel and consultancies werereduced as the company focussed on achieving better quality revenue streams.

A pleasing aspect of this year's accounts is the stabilisation of cash utilisation. Net operatingcash usage for 2011 at $10.97 million was similar to that of 2010 at $10.91 million. This wasachieved despite a significant fall in operational revenue from $3.0 million to $1.4 million.Dyesol has changed its emphasis to long-term wealth creation as the prospects of itscommercial collaborations become more certain. Both steel and glass projects are firmly ontrack - on time and within budget. Future cost trends should see further reduction in corporatedevelopment expenditure and administration while increasing commitments will be directed todelivering our products to the market through engineering development, technologyinnovation and expansion of materials production, which will be countered by significantrevenue generated by the commercialisation success of its multi-national collaborators.

The company's balance sheet has finished the financial year in a robust position. Theprincipal change is the reduction in net assets by $10.6 million. This reflects lower net cashreserves and an increase in equity-related loans or current liabilities. Notably, currentliabilities have fallen by $0.8 million subsequent to balance date. In essence, theestablishment of an equity loan facility means the company can carry less cash which helpsameliorate shareholder dilution in the transition period between formal commercialisation andgeneration of substantial partnership related cash flow. Reduced cash at bank is more thanoffset by undrawn and flexible loan facilities of approximately $20 million. Dyesol's financialprospects are also strongly enhanced by the reliance of its collaborators on materials supplyand future technology this is our responsibility and where we will direct our efforts. As theseprojects enter the production phase, Dyesol will generate the cash necessary through a mix ofgovernment incentives, partner finance and in-company equity finding the best balance toreturn value to shareholders.

Since listing on the Australian Securities Exchange (ASX), Dyesol's principal objective hasbeen to effectively manage the risk in transitioning from research and development to full-scale commercialisation of a new, disruptive solar technology, dye solar cells (DSC). Thereality and excitement of this prospect will become increasingly apparent in the forthcomingperiod. Tata, in particular, has published exciting global commercialisation opportunities that,on commitment, will help transform Dyesol to a major specialist materials supplier for themulti-billion dollar building integrated photovoltaic market (BIPV).

Audited accounts will be finalised for the market on schedule.


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Part 10 Revenue and Expenses

The loss before income tax includes the following items ofrevenue and expense:

2011$

2010$

(a) Revenue from continuing operationsRendering of services 27,312 378,692Sale of goods 1,385,990 2,663,329

1,413,302 3,042,021

Interest revenue 161,786 168,473

Other incomeGovernment grant 1,109,897 1,419,528Other revenue 62,531 79,754

1,172,428 1,499,282

Total revenue from continuing operations 2,747,516 4,709,776

(b) Depreciation, amortisation and impairment loss

Amortisation of intangible assets 270,067 248,739Impairment of Goodwill 146,922 -Depreciation expense 1,983,954 2,118,891

2,400,943 2,367,630

(c) Finance costs

Interest expense 71,264 1,928

71,264 1,928

(d) Employee benefits expense

Wages and salaries costs 5,678,173 5,276,582Equity-settled share-based payments to employees anddirectors 2,005,486 813,377Equity-settled share-based payments to consultant 17,250 -Superannuation costs 308,280 335,679Redundancy payment 5,885 5,667(Decrease)/increase in liability for annual leave 14,103 (7,056)Increase/(decrease) in liability for long service leave 17,447 16,684

8,046,624 6,440,933

Part 11 Notes to the Statement of Cash Flows

2011$

2010$

(a) Reconciliation of cash

Cash at the end of the financial year as shown in thestatement of cash flows is reconciled to the related items inthe balance sheet as follows:

Cash and cash equivalents 6,293,440 13,137,203


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Part 11 Notes to the Statement of Cash Flows (continued)

2011$

2010$

(b) Reconciliation of net cash flows from operatingactivities to loss after income tax

Loss for the period (17,284,551) (14,372,212)

Add non-cash items:

- Depreciation 1,983,954 2,118,891- Amortisation 270,067 248,739- Goodwill impairment 146,922 -- Equity settled share-based payments 2,022,736 837,621- Unrealised exchange losses 178,818 (3,198)- Loss on movement in fair value of derivative liability 363,032 -

- Loss on sale of property , plant & equipment 5,592 -

Operating loss before changes in assets and liabilities (12,313,430) (11,170,159)

Changes in assets and liabilities during the period:

(Increase)/ decrease in trade and other receivables 1,039,881 (509,365)

Decrease/(increase) in other current assets (94,370) 94,070Increase in inventories 341,288 (178,602)Increase in trade and other payables 107,203 925,036Increase in provisions 31,550 9,626Decrease in deferred tax liability (81,158) (76,245)

Net cash used in operating activities (10,969,036) (10,905,639)

Part 12 Details Relating to Dividends

Date the dividend is payable N/A

Record date to determine entitlement to the dividend N/A

Amount per security N/ATotal dividend N/A

Amount per security of foreign sourced dividend or distribution N/A

Details of any dividend reinvestment plans in operation N/A

The last date for receipt of an election notice for participation in anydividend reinvestment plans

N/A

Part 13 Earnings per Share

2011 2010

Basic loss per ordinary share (11.92 cents) (11.04 cents)Diluted loss per share is not shown as all potential ordinary shares on issue woulddecrease the loss per share and are thus not considered dilutive.

No. No.Weighted average number of ordinary shares used as thedenominator in the calculation of basic loss per share 145,054,856 130,234,536

Part 14 Net Tangible Assets per Security

2011 2010


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Net tangible asset backing per ordinary security 3.48 Cents 11.50 Cents

Part 15 Details of Entities Over Which Control has been Gained or Lost

Name of entity N/A

Date control gained or lost N/A

Contribution of the controlled entity to the profit/(loss) fromordinary activities during the period, from the date of gaining orlosing control

N/A

Profit (loss) from ordinary activities of the controlled entity forthe whole of the previous corresponding period

N/A

Part 16 Issued Securities

2011($)

2010($)

Share capital

153,894,736 (2010: 142,875,632) fully paid ordinary shares 66,848,603 61,483,094

The following movements in issued capital occurred during the year:

Number ofOrdinary Fully

Paid Shares

IssuedCapital

($)

Balance at beginning of year 142,875,632 61,483,094Placement of shares for cash at $ 0.65 (2010: $1) 8,461,539 5,500,000Issue of shares as a share base payment 2,557,565 162,083Transaction costs of share issues - (296,574)

Balance at the end of year 153,894,736 66,848,603

2011Number 2010Number

Share Options

Options exercisable 8,714,000 4,314,000

The following movements in the number of

options occurred during the financial period:

Balance at the beginning of year 4,314,000 1,814,000

Issue of options to employees, directors andconsultants for nil consideration 5,000,000 3,000,000

Options lapsed (600,000) (500,000)


Other Share Options

During the year the Company granted the following options over unissued ordinary shares:- 2,000,000 options exercisable at $1.00 each on or before 30 November 2013.- 2,500,000 options exercisable at $ 0.925 each on or before 29 April 2015.- 500,000 options exercisable at $ 0.89 each on or before 22 December 2013.

During the year the following options over unissued ordinary shares lapsed:- 600,000 options exercisable at $1.25 each on or before 15 November 2010.

No options were exercised during the year.


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At balance date, unissued ordinary shares of the Company under share option are:

- 714,000 options exercisable at $1.16 each on or before 31 December 2012.

- 2,000,000 options exercisable at $1.10 each on or before 27 November 2012.

- 1,000,000 options exercisable at $1.20 each on or before 27 November 2013.

- 2,000,000 options exercisable at $1 each on or before 30 November 2013.

- 2,500,000 options exercisable at $ 0.925 each on or before 29 April 2015.

- 500,000 options exercisable at $ 0.89 each on or before 22 December 2013

These options do not entitle the holder to participate in any share issue of the Company or any otherbody corporate.

2011Number

2010Number

Share rights

Share rights exercisable 1,672,038 2,512,695

The following movements in the number of

share rights occurred during the financial period:

Balance at the beginning of year 2,512,695 -

Issue of share rights to employees for nil consideration 124,000 2,512,695

Share rights lapsed (361,186) -

Share rights exercised (603,471) -


Part 17 Subsequent Events

1. On 5 July 2011 SpringTree Special Opportunities Fund LP exercised their right to convertAUD800,000 of the Convertible Security into 2,076,843 shares at the conversion price ofAUD0.3852 per share, pursuant to Section 7.2 of the Share Purchase and Convertible SecurityAgreement between Dyesol Limited and SpringTree Special Opportunities Fund, LP datedMay 3, 2011.

2. On 4 August 2011, 934,798 shares were issued to SpringTree Special Opportunities Fund LPat the conversion price of AUD0.4279 per share in respect to AUD400,000 advanced to DyesolLimited on 6 July 2011, in accordance to Section 7.1 of the Share Purchase and ConvertibleSecurity Agreement between Dyesol Limited and SpringTree Special Opportunities Fund, LPdated May 3, 2011.

3. On 24 August 2011, 576,686 shares were issued to employees upon vesting of share rights andautomatic conversion into shares. The share rights were vested upon achievement ofemployees performance conditions pursuant to the Companys Employee Incentive OptionPlan. The share based payments made to employees were valued based on the closing shareprice of $1.05, by reference to the ASX at the date of grant.

4. On 29 August 2011, 500,000 options have been granted to an employee as remuneration forservices provided to the Company. The share based payments was valued based on the closingshare price of $0.47, by reference to the ASX at the date of grant.

5. Mr. Gerry Grove-White joined the board as a non-executive director in August 2011.

Part 18 Audit Status

This report is based on accounts to which one of the following applies:(Tick one)


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The accounts have been audited The accounts have been subject to review

The accounts are in the process of beingaudited or subject to review

The accounts have not yet been audited orreviewed

If the accounts have not yet been audited or subject to review and are likely to be subject todispute or qualification, a description of the likely dispute or qualification:

Not Applicable

If the accounts have been audited or subject to review and are subject to dispute or qualification,a description of the dispute or qualification:

Not Applicable

dye110831 - appendix 4e - preliminary final report

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