Melbourne, 23rd August 2010: Cellestis (ASX.CST) which develops and markets QuantiFERON-TB (QFT) - increasingly recognised as the gold standard of testing for tuberculosis (TB) - has continued to achieve year on year earnings growth, announcing an increase of profit from operations of 26%.
The company noted that revenues increased by 49% in the US. In Europe revenue grew by 31%, and in the Australia/ Japan segment revenue grew by 25%. Overall local currency sales increased 38% on average.
Dr Tony Radford, CEO of Cellestis said the Company had built on the record profit from operations and sales achieved last year, and continues to strengthen its financial position.
“It’s been another very positive year for Cellestis, underlying growth is very strong with revenues increasing across all of our major markets - the USA, Europe, Australia and Japan.
“We have increased our marketing and sales activities this year, which has had a direct impact on revenue growth and shows that our business model - which is to supply product directly in the major markets of Europe and the USA, and through local distribution partners in other markets - continues to be successful. This year we will be delivering a greater return to shareholders, with an end of year dividend of 3.5? per share, making 5.0? for the full year.”
“TB is a disease that still claims one life every 17 seconds worldwide and increasingly authorities across the world recognise that QFT is the most accurate and practical method for testing for TB infection. For example, this year the US Centres for Disease Control and Prevention (CDC) released guidelines recommending the preferential use of blood tests, such as QFT, to test for TB infection, which was a very significant development for our company and will help to continue to grow sales.”
Dr Radford noted that the strength of the Australian dollar had impacted upon the overall income, despite the growth in sales. Cellestis Limited | ACN 094 962133 | Ph: +61 3 8527 3500 | Fax: +61 3 9568 6623 | www.cellestis.com
“The strength of the Australian dollar has impacted the actual revenue achieved as almost all of the group’s revenue is generated in US dollars, Euro and Japanese Yen. However, excluding the effect of a one-off foreign exchange gain of $1.411 million in 2009, our profit from operations before tax increased by 26% and is an indication of the underlying strength of the company. Furthermore, we expect continued strong growth in the year ahead.”
For media and investor enquiries please contact: Kyahn Williamson or Erin Godfrey Buchan Consulting T: 03 9866 4722 M: 0401 018 828 / 0438 313 350 E: kwilliamson@bcg.com.au / egodfrey@bcg.com.au
About Cellestis: Cellestis is a listed Australian biotechnology company commercialising QuantiFERON® technology for diagnosing TB and other diseases worldwide. QuantiFERON® - TB Gold tests for the presence or absence of a protein (gamma-interferon) produced by a patient’s white blood cells after stimulation with specific TB proteins. The test has received regulatory and policy approvals in the USA, Japan, Europe and elsewhere. The Company operates through subsidiaries in the USA, Europe, Australia and Japan.
For more information please visit www.cellestis.com
Appendix 4 E Preliminary Final Report of Cellestis Limited for the Financial Year Ended 30 June 2010
(ABN 86 094 962 133)
This Preliminary Final Report is provided to the Australian Stock Exchange (ASX) under ASX Listing Rule 4.3A.
Current Reporting Period: Financial Year ending 30 June 2010
Previous Corresponding Period: Financial Year ending 30 June 2009
1Cellestis Limited Results For Announcement To The Market For the Financial Year Ended 30 June 2010 2
Revenue and Net Profit Percentage Change % Amount $’000 Revenue from ordinary activities up/down 17% To 41,110 Profit from operations before tax up/down 26% To 10,223 Profit from ordinary activities after tax attributable to members up/down 0.3% To 8,253 Net profit attributable to members up/down 0.3% To 8,253
Dividends (Distributions) Amount per security Franked amount per security Final dividend 3.5 ¢ 3.5 ¢ Interim dividend 1.5 ¢ 1.5 ¢ Record date for determining entitlements to the dividend: • final dividend • interim dividend
1 October 2010
n/a
Brief Explanation of Revenue, Net Profit/(Loss) and Dividends (Distributions)
• Please refer to Note 4 to the Financial Statements for commentary. • It is proposed that a final dividend (fully franked) of 3.5¢ to be paid out of profits for the year ended 30 June 2010. It is proposed that this dividend will be paid on 15 October 2010 to shareholders on the register of members as of 1 October 2010. Cellestis Limited Statement of Financial Performance For the Financial Year Ended 30 June 2010
Note 30 June 2010 $000 30 June 2009 $000 Revenue 2 40,383 34,461 Cost of sales (13,690) (11,491) Gross profit 26,693 22,970 Other income 2 727 780 Selling, Marketing and business development expense (12,604) (11,351) Administration, finance and corporate costs (1,939) (2,214) Share options expense (362) (208) Research & development expense (1,309) (963) Legal, insurance, patent & regulatory expense (480) (416) Depreciation and amortisation expense (503) (487) Profit from operations before tax 3 10,223 8,111
Foreign exchange gain on intercompany payments - 1,411 Profit before income tax 10,223 9,522 Income tax expense (1,970) (1,290) Profit from continuing operations attributable to owners of Cellestis Limited 8,253 8,232
Other Comprehensive income Exchange differences on translation of foreign operations (647) (692) Total Comprehensive income for the year attributable to owners of Cellestis Limited 7,606 7,540
Earnings per share for profit from continuing operations attributable to owners of Cellestis Limited Basic earnings per share (cents per share) 7 8.6¢ 8.6¢ Diluted earnings per share (cents per share) 7 8.5¢ 8.5¢
The accompanying notes form part of these financial statements.
Cellestis Limited Statement of Financial Position As at 30 June 2010
30 June 2010 $000 30 June 2009 $000 ASSETS CURRENT ASSETS Cash and cash equivalents 22,576 19,695 Trade and other receivables 7,515 6,058 Inventories 1,594 1,832 Prepayments 450 29 32,135 27,614 NON-CURRENT ASSETS Plant and equipment 1,145 767 Deferred tax assets 2,173 887 Intangible assets 203 321 3,521 1,975 TOTAL ASSETS 35,656 29,589 CURRENT LIABILITIES Trade and other payables 6,071 4,981 Current tax liabilities 1,630 1,871 Provisions 456 370 8,157 7,222 NON-CURRENT LIABILITIES Provisions 187 136 187 136 TOTAL LIABILITIES 8,344 7,358 NET ASSETS 27,312 22,231 EQUITY Issued capital 29,377 28,901 Reserves (6) 286 (Accumulated losses) (2,059) (6,956) TOTAL EQUITY 27,312 22,231
The accompanying notes form part of these financial statements. Cellestis Limited Statement of Changes in Equity For the Financial Year Ended 30 June 2010
Share Capital
Share Option Reserve Foreign Currency Translation Reserve (Accumulated Losses) Total Ordinary $000 $000 $000 $000 $000
Balance at 1 July 2008 28,901 1,021 140 (14,619) 15,443 Total comprehensive income for the year - - (692)
8,232
7,540 Transactions with owners in their capacity as owners
Addition to share option reserve - 208 - - 208 Transfer from share option reserve - (391) - 391 - Dividends paid - - - (960) (960) Balance at 30 June 2009 28,901 838 (552) (6,956) 22,231 Total comprehensive income for the year - - (647)
8,253
7,606 Transactions with owners in their capacity as owners
Shares issued during the period 476 - - - 476 Addition to share option reserve - 362 - - 362 Transfer from share option reserve - (7) - 7 - Dividends paid - - - (3,363) (3,363) Balance at 30 June 2010 29,377 1,193 (1,199) (2,059) 27,312
The accompanying notes form part of these financial statements.Cellestis Limited Statement of Cash Flows For the Financial Year Ended 30 June 2010
CASH FLOWS FROM OPERATING ACTIVITIES Note 30 June 2010 $000 30 June 2009 $000 Receipts from customers 40,027 32,923 Payments to suppliers and employees (30,456) (26,513) Interest received 713 756 Income tax paid (3,494) (310) Net cash provided by operating activities 5 6,790 6,856
CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant & equipment (763) (630) Net cash used in investing activities (763) (630)
CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares 476 - Dividends paid by parent entity (3,363) (960) Net cash used in financing activities (2,887) (960)
Net increase in cash and cash equivalents 3,140 5,266 Cash and cash equivalents at 1 July 2009 19,695 14,141 Effect of exchange rates on cash holdings in foreign currencies (259) 288 Cash and cash equivalents at 30 June 2010 5 22,576 19,695
Cellestis Limited Notes to the Financial Statements For the Financial Year Ended 30 June 2010
Note Contents 1 Basis of Preparation 2 Revenue from Ordinary Activities 3 Profit from Ordinary Activities 4 Commentary on Results 5 Cash Flow Information 6 Dividends 7 Earnings Per Share 8 Net Tangible Assets per Security 9 Details of Entities Over Which Control Has Been Gained or Lost 10 Contingent Assets and Contingent Liabilities 11 Segment Information 12 Information on Audit or Review
Cellestis Limited Notes to the Financial Statements For the Financial Year Ended 30 June 2010
1 Basis of Preparation This preliminary final report has been prepared in accordance with ASX Listing Rule 4.3A and the disclosure requirements of ASX Appendix 4E.
The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, including Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. The financial report covers the consolidated group of Cellestis Limited and controlled entities. Cellestis Limited is a listed public company, incorporated and domiciled in Australia.
The financial report of Cellestis Limited and controlled entities complies with all International Financial Reporting Standards (IFRS) in their entirety.
Reporting Basis and Conventions The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, and financial assets and financial liabilities for which the fair value basis of accounting has been applied. 2 Revenue from Ordinary Activities 2010 $’000 2009 $’000 Revenue Sale of goods
40,383
34,461 Other income Interest received
727
780 Total revenue 41,110 35,241
3 Profit from Ordinary Activities
Profit from ordinary activities before income tax includes the following items of expense:
Depreciation of plant and equipment (385) (370) Amortisation of licence (118) (117) Foreign currency gains - other 449 5 Rental expense on operating leases - minimum lease payments (712) (574) Share options expense (362) (208) Employee benefits (8,952) (8,268)
Foreign exchange gain on intercompany payments - 1,411
Cellestis Limited Notes to the Financial Statements For the Financial Year Ended 30 June 2010
4 Commentary on Results
Sales revenue growth (in local currencies) of the key reportable segments for the year was strong. The annual growth of the key segments for 2010 were: — USA 49% — Europe 31% — Australia/ Japan 25% As almost all Group revenue is generated in currencies other than AUD, predominantly USD, EUR & JPY, the reported sales for 2010 were adversely affected by the strong AUD. This resulted in consolidated sales revenue as reported in AUD growing by 17% to $40,383,000. As in past years, notable items continue to be: — improved revenues in the key USA, European and Japanese markets; — increased marketing and selling activities; — maintaining and augmenting the customer support and distribution infrastructure; — the importance of continued research and development expenditure; Long-term success continues to be the Group’s focus with investment in marketing, business development and research and development continuing to be the cornerstone of the future. The Directors believe the Group is well placed to continue its strategic endeavours to achieve planned business growth. The Group maintains its model of contract production, direct selling in primary markets and distribution elsewhere. On a pre-tax basis and excluding the effect of one-off foreign exchange gains of $1,411,000 on intercompany debt repayments in 2009, there was a $2,112,000 or 26% improvement in Profit from operations before tax. 2010 $000 2009 $000 Net change $000 Profit before income tax 10,223 9,522 701 Foreign exchange gains on intercompany debt repayments - (1,411) 1,411 Profit from operations before tax 10,223 8,111 2,112
Due to outflows of dividends and company tax, the net cash flow generated in the year was $3,140,000 compared with $5,266,000 for the prior year.
Cellestis Limited Notes to the Financial Statements For the Financial Year Ended 30 June 2010 10
5 Cash Flow Information 2010 $000 2009 $000 Reconciliation of Cash Flow from Operations with Profit from Ordinary Activities after Income Tax Profit after income tax 8,253 8,232 Cash flows excluded from profit attributable to operating activities Non-cash flows in profit Amortisation 118 117 Depreciation 385 370 Net exchange differences (388) (980) Share options expensed 362 208 Changes in assets and liabilities, net of the effects of purchase and disposal of subsidiaries
Decrease/(increase) in trade and other receivables (1,457) (2,434) Decrease/(increase) in prepayments (421) 1 Decrease/(increase) in inventories 238 (980) Decrease/(increase) in deferred tax assets (1,286) (887) Increase/(decrease) in trade payables and accruals 1,090 1,219 Increase/(decrease) in current tax liabilities (241) 1,868 Increase/(decrease) in provisions 137 122 Cash flow from operations 6,790 6,856
Reconciliation of cash
Cash at the end of the financial year as shown in the statement of cash flows is reconciled to items in the balance sheet as follows: Cash and cash equivalents 22,576 19,695
6 Dividends 2010 $000 2009 $000 Dividends paid during the year
Final dividend for the year ended 30 June 2009 of $0.02 (2008-Nil) per fully paid share; Fully franked based on tax paid at 30% - $0.02.(2008: Nil) per share
Interim dividend for the year ended 30 June 2010 of $0.015 (2009-$0.01) per fully paid share; Fully Franked based on tax paid at 30% - $0.015 per share Unfranked Interim dividend for the year ended 30 June 2009 – $0.01 per share
1,920
1,443 -
-
- 960 3,363 960 Dividends not recognised at the end of the reporting period Proposed final dividend for the year ended 30 June 2010 of $0.035 (2009-$0.02) per fully paid share fully franked based on tax paid at 30%
3,365 1,920
Cellestis Limited Notes to the Financial Statements For the Financial Year Ended 30 June 2010
7 Earnings Per Share 2010 $000 2009 $000 a. Profit from continuing operations attributable to owners of Cellestis Limited 8,253 8,232 Earnings used in the calculation of basic and dilutive EPS 8,253 8,232
Number of shares/ options Number of shares/ options b. Weighted average number of ordinary shares outstanding during the year used in calculation of basic EPS 96,095,614 96,001,778 Weighted average number of options outstanding 535,670 1,402,158 Weighted average number of ordinary shares outstanding during the year used in calculation of dilutive EPS 96,631,284 97,403,936 c. Classification of securities The following securities have been classified as potential ordinary shares and are included in determination of dilutive EPS: — Options outstanding 2,892,500 3,022,500
d. Basic earnings per share (cents per share) 8.6¢ 8.6¢ Diluted earnings per share (cents per share) 8.5¢ 8.5¢
8 Net Tangible Assets Per Security
Net tangible assets per security 28.2¢ 22.8¢
9 Details of Entities Over Which Control Has Been Gained or Lost
The parent entity did not acquire or dispose of any business or operations during the year.
10 Contingent Assets and Contingent Liabilities
The consolidated group is not aware of any material contingent asset or liability as at the date of this report other than as stated below.
Contingent Liability – Related party guarantee provided by the parent entity The parent entity has provided a limited guarantee in relation to the provision of a credit card facility for its US subsidiary. This guarantee is limited to USD 200,000 and is for the term of the facility.
Contingent Liability – Bank guarantee The group’s corporate banker, HSBC Bank Australia Limited, has provided a bank guarantee in the amount of $106,000 with respect to a rental agreement entered into by the parent entity. A corresponding term deposit amount is held by the bank as security.
Cellestis Limited Notes to the Financial Statements For the Financial Year Ended 30 June 2010
11 Segment Information The Group operates in three principal reportable segments – Australia (including Japan), United States of America (USA) and Europe. Core business functions (e.g. marketing, research & development, manufacturing, finance) are located in Australia with sales, marketing and distribution also operating in the USA and Europe (Germany). The operating results of these segments are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance.
The Group’s revenue and results by reportable operating segment for the periods under review are as follows: Australia/ Japan USA Europe Economic Entity 2010 2009 2010 2009 2010 2009 2010 2009 $000 $000 $000 $000 $000 $000 $000 $000 External sales 8,949 8,321 17,842 13,927 13,592 12,213 40,383 34,461 Inter-segment sales 14,720 10,653 - - - - 14,720 10,653 Total of all segments 23,669 18,974 17,842 13,927 13,592 12,213 55,103 45,114 Eliminations (14,720) (10,653) Consolidated revenue 40,383 34,461
Segment result 8,510 7,681 1,027 197 689 233 10,226 8,111 Unallocated result (3) 1,411 Income tax expense (1,970) (1,290) Profit after income tax 8,253 8,232
ASSETS
Segment assets 23,317 20,304 7,123 5,084 5,216 4,201 35,656 29,589 Unallocated assets - - - - - - - - Total assets 23,317 20,304 7,123 5,084 5,216 4,201 35,656 29,589
LIABILITIES
Segment liabilities 6,966 6,272 619 540 759 546 8,344 7,358 Unallocated liabilities - - - - - - - - Total liabilities 6,966 6,272 619 540 759 546 8,344 7,358
OTHER
Acquisitions of non-current segment assets 385 52 318 487 60 91 763 630
Depreciation and amortisation of segment assets 227 189 227 253 49 45 503 487
