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UNIVERSAL BIOSENSORS INC - 10-Q - Management's Discussion and Analysis of Financial Condition and Results of Operations(Edgar Glimpses Via Acquire Media NewsEdge) The following discussion and analysis provides information that we believe is relevant to an assessment and understanding of our results of operations and financial condition. You should read this analysis in conjunction with our audited consolidated financial statements and related footnotes and Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Form 10-K filed with the United States Securities and Exchange Commission ("SEC"). This Form 10-Q contains, including this discussion and analysis, certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which are intended to be covered by the safe harbors created by such acts. For this purpose, any statements that are not statements of historical fact may be deemed to be forward looking statements, including statements relating to future events and our future financial performance. Those statements in this Form 10-Q containing the words "believes", "anticipates", "plans", "expects", and similar expressions constitute forward looking statements, although not all forward looking statements contain such identifying words. The forward looking statements contained in this Form 10-Q are based on our current expectations, assumptions, estimates and projections about the Company and its businesses. All such forward looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results to be materially different from those results expressed or implied by these forward-looking statements, including those set forth in this Quarterly Report on Form 10-Q. Our Business We are a specialist medical diagnostics company focused on the research, development and manufacture of in vitro diagnostic test devices for consumer and professional point-of-care use. We were incorporated in the State of Delaware on September 14, 2001 and our shares of common stock in the form of CHESS Depositary Interests have been quoted on the ASX since December 13, 2006. Our securities are not currently traded on any other public market. Our wholly owned subsidiary and primary operating vehicle, UBS, was incorporated as a proprietary limited company in Australia on September 21, 2001. UBS conducts our research, development and manufacturing activities in Melbourne, Australia. We have rights to an extensive patent portfolio, with certain patents owned by UBS and a number licensed to UBS by LifeScan, Inc. and other third party licensors. We are using our electrochemical cell technology platform to develop tests for a number of different markets. Our current focus is as set out below: • Coagulation testing market - we are working with Siemens to develop a range of products for the point-of-care coagulation market pursuant to a Collaboration Agreement and, subject to being approved for sale, plan to manufacture test strips for these products under a Supply Agreement with Siemens. We are also developing our own PT-INR test targeted at the patient self-test market and intend to enter into distribution agreements with respect to that test. We received our first commercial order from Siemens for the production of PT-INR test strips. The responsibility for obtaining regulatory approvals and the final decision to launch the product rests with Siemens. • Blood glucose - we expect to provide services to LifeScan as required from time to time, pursuant to a Master Services and Supply Agreement and a Development and Research Agreement with LifeScan. • Other electrochemical-cell based tests - we are working on proving the broader the applicability of our technology platform, including tests based on enzymatic, immunoassay and molecular diagnostic methods. We may seek to enter into collaborative arrangements, strategic alliances or distribution agreements with respect to any tests arising from this work. 22 -------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. Results of Operations Analysis of Consolidated Revenue Our total revenue decreased by 68% and 70% to A$1,513,981 and A$2,865,932, respectively during the three and six months ended June 30, 2014 compared to the same period in the previous financial year. The movement in total revenue during these periods was due to the following factors: • Revenue from products - we manufactured OneTouch® Verio® strips for LifeScan and generated product revenue up until the end of the 2013 financial year. With effect from December 31, 2013, we ceased the manufacture of the OneTouch®Verio® blood glucose testing product. • Revenue from services - the decline in revenue from products (above) was partly offset by an increase in quarterly service fees. Revenue from Products OneTouch® Verio® was first launched in the Netherlands in January 2010 and is now available in countries that represent over 90% of the world self-monitoring blood glucose market. The manufacturing results of the blood glucose test strips during the respective periods are as follows: Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Revenue from products 0 3,455,253 0 7,201,071 Cost of goods sold 0 (3,206,717 ) 0 (6,920,431 ) 0 248,536 0 280,640 Production margin 0 % 7 % 0 % 4 % Between 2009 and 2013, UBS acted as a non-exclusive manufacturer of blood glucose test strips for LifeScan's OneTouch® Verio® blood glucose testing product. With effect from December 31, 2013, UBS ceased the manufacture of the OneTouch® Verio® blood glucose test strips for LifeScan. Manufacture of the OneTouch® Verio® strips has been transitioned to LifeScan's existing facility in Inverness, Scotland. We currently do not manufacture any other products and do not expect to generate revenues from products until we are able to manufacture test strips pursuant to the Supply Agreement with Siemens. Revenue from Services We provide various services to our customers and partners. The revenue from services is grouped into the following categories: • Product enhancement - a quarterly service fee based on the number of strips sold by our customers and partners is payable to us as an ongoing reward for our services and efforts to enhance the product; • Contract research and development - we undertake contract research and development on behalf of our customers and partners; • Other services - ad-hoc services provided on an agreed basis based on our customers' and partners' requirements. 23 -------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. There are different arrangements for each service being provided. The net margin during the respective periods in relation to the provision of services is as follows: Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Revenue from services: Quarterly services fee 1,369,529 760,617 2,582,588 1,600,733 Contract research and development 0 479,893 0 479,893 Other services 144,452 74,690 283,344 297,730 1,513,981 1,315,200 2,865,932 2,378,356 Cost of services (6,777 ) (554,388 ) (22,922 ) (632,013 ) 1,507,204 760,812 2,843,010 1,746,343 100 % 58 % 99 % 73 % Quarterly service fee - The quarterly service fee increased by 80% and 61%, respectively during the three and six months ended June 30, 2014 compared to the same period in the previous financial year, reflecting ongoing market penetration and growth. The OneTouch® Verio® is now sold in over 90% of the world self-monitored blood glucose market. LifeScan launched the product initially in the Netherlands in January 2010 before making it available for sale in Australia in September 2010. During 2011, there were further launches of the product in Europe including France, Italy, Germany, the United Kingdom, Ireland and Spain. LifeScan first launched the OneTouch® Verio® system in the United States in January 2012. LifeScan has the ability to terminate the obligation to pay quarterly service fees to us in certain situations set out in the Master Services and Supply Agreement or with the agreement of Universal Biosensors. LifeScan has the option to give notice to convert the quarterly service fees, which it may only do so once it has paid cumulative quarterly service fees of US$45 million. To date, LifeScan has paid cumulative quarterly service fees of US$8.5 million. Where it gives such notice, LifeScan is required to the pay the quarterly service fees for the remainder of the year in which notice is given and at the end of that year, LifeScan must pay a one-time lump sum fee. This fee is calculated by multiplying the sum of all quarterly service fees for the relevant year in which notice is given by a multiplier (on a sliding scale from 3x if LifeScan gave notice in 2012 to 2x if notice is given in 2018 and beyond). LifeScan may also terminate the obligation to pay quarterly service fees if certain other factors detailed in the Master Services and Supply Agreement arise, including LifeScan ceasing to sell the product, termination for breach, insolvency and bankruptcy, change of control and regulatory termination. Contract research and development - The nature and scope of contract research and development is determined by our customers and partners based upon their requirements and therefore our revenues and margins tend to fluctuate. We did not perform or generate any revenue from contract research and development during the three and six months ended June 30, 2014. Other services - We generated these revenues principally from Siemens based on work undertaken for them. Contribution from Products & Services The contribution from products and services has increased by 49% and 40%, respectively during the three and six months ended June 30, 2014 compared to the same period in the previous financial year. The increase is primarily represented by the growth in the quarterly service fee which has a 100% margin. Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Revenue from products & services 1,513,981 4,770,453 2,865,932 9,579,427 Cost of goods sold & services (6,777 ) (3,761,105 ) (22,922 ) (7,552,444 ) Contribution from products & services 1,507,204 1,009,348 2,843,010 2,026,983 Contribution margin 100 % 21 % 99 % 21 % 24 -------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. Research and Development Expenses Research and development expenses are related to developing electrochemical cell platform technologies. Research and development expenses consist of costs associated with research activities, as well as costs associated with our product development efforts, including pilot manufacturing costs. Research and development expenses include: • consultant and employee related expenses, which include consulting fees, salary and benefits; • materials and consumables acquired for the research and development activities; • external research and development expenses incurred under agreements with third party organizations and universities; and • facilities, depreciation and other allocated expenses, which include direct and allocated expenses for rent and maintenance of facilities, depreciation of leasehold improvements and equipment and laboratory and other supplies. Our principal research and development activities can be described as follows: (a) Blood coagulation We are developing Prothrombin Time tests for monitoring the therapeutic range of the anticoagulant, warfarin, based on measuring activity of the enzyme thrombin. In September 2011 we entered into a Collaboration Agreement with Siemens which was amended in September 2012, pursuant to which we will develop a range of test strips and reader products for the point-of-care coagulation market. The first test currently being developed is a modified version of our PT-INR test. In 2012, we entered into a Supply Agreement with Siemens under which we will manufacture and supply the test strips for these systems. We are also developing our own PT-INR test targeted at the patient self-test market. All the systems we are currently developing in the blood coagulation platform are in the advanced development phase. (b) Immunoassay We are continuing to develop our immunoassay platform targeting a broad range of potential assays. Our vision is to target a single meter and consumable design that can detect analytes across a wide range of sensitivities creating a broad-based multi-test solution while minimizing the incremental research and development effort required for each new test. This platform incorporates the ability to perform D-Dimer and C Reactive Protein tests and leverages past research work on these tests. This work is currently in the feasibility phase. (c) DNA/RNA We have undertaken some early stage feasibility work assessing the possibility of using DNA binding chemistries to build a low-cost test for DNA, RNA and as a possible alternative method for improving the sensitivity of protein assays. This concept work is at an early stage and may not yield any positive results. To enable us to access certain molecular diagnostic technology, we entered into a license with SpeeDx. SpeeDx is an Australian technology company focused on the development of catalytic nucleic acid enzymes for medical diagnostics and other applications. Research and development expenses for the respective periods are as follows: Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Research 318,232 573,422 744,535 978,678 Development 3,952,136 2,874,780 8,441,020 6,927,453 Research and development expenses 4,270,368 3,448,202 9,185,555 7,906,131 Depending on the scope of research and development activities we undertake and the stages of development of each of these activities, our research and development expenditure will fluctuate. 25-------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. In converting an idea or a concept into a commercial product, a number of development stages are required. The closer the idea or the concept to a product, the lower the technical risk but the greater the effort and cost expended. In our research and development program, the first phase is conducting exploratory research and feasibility studies. In this phase the idea is investigated by a small focused team to establish the viability of the concept as the base for a product. Once this hurdle has been passed, the project enters the development phases, which include building prototype strips and instruments, finalizing the product design, carrying out extensive testing, creating the required documentation and developing or validating the product manufacturing processes. This requires a larger group of people and a higher use of materials compared to the research phase, so is typically more expensive, but necessary to be able to commercialize a product. Research and development expenditure increased by 24% and 16% during the three and six months ended June 30, 2014 compared to the same period previous financial year. The increase principally reflects the effort required to complete the final stages of the development phase prior to launch of the four tests we are undertaking. The first of these tests, the Prothrombin Time test, for which we have already received a first commercial order from Siemens, is anticipated to launch in the current financial year. The non-cash components of depreciation and share based payments expense included in the research and development expenditure are as follows: Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Depreciation 541,518 153,435 1,125,505 304,758 Share based payments (59,221 ) 55,257 (211,018 ) 127,651 482,297 208,692 914,487 432,409 While we have a degree of control as to how much we spend on research and development activities in the future, we cannot predict what it will cost to complete our individual research and development programs successfully or when or if they will be commercialized. The timing and cost of any program is dependent upon achieving technical objectives, which are inherently uncertain. In addition, our business strategy contemplates that we may enter into collaborative arrangements with third parties for one or more of our non-blood glucose programs. In the event that we are successful in securing such third party collaborative arrangements, the third party may direct the research and development activities and may contribute towards all or part of the cost of these activities, both of which will influence our research and development expenditure. Research and development activities undertaken on behalf of our customers and partners for the three months ended June 30, 2014 and June 30, 2013 were A$2,264,986 and A$2,366,780, respectively and A$5,284,753 and A$5,776,715 for the six months ended June 30, 2014 and June 30, 2013, respectively. General and Administrative Expenses General and administrative expenses currently consist principally of salaries and related costs, including stock option expense, for personnel in executive, business development, finance, accounting, information technology and human resources functions. Other general and administrative expenses include depreciation, repairs and maintenance, insurance, facility costs not otherwise included in research and development expenses, consultancy fees and professional fees for legal, audit and accounting services. General and administrative expenses are generally fixed in nature. General and administrative expenses increased by 13% and 10% during the three and six months ended June 30, 2014 compared to the same period previous financial year. The increase is primarily represented by non-recurring consultancy services commissioned by us. 26-------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ General and administrative expenses 1,683,105 1,487,733 3,066,511 2,795,398 The non-cash components of depreciation and share based payments expense included in the general and administrative expenditure are as follows: Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Depreciation 42,532 17,760 65,583 36,337 Share based payments (22,736 ) 60,413 (69,746 ) 139,561 19,796 78,173 (4,163 ) 175,898 Interest Income Interest income decreased during the three and six months ended June 30, 2014 compared to the same period in the previous financial year. The decrease in interest income is generally attributable to the lower amount of funds available for investment in Australian currency. A large portion of our funds is held in US denominated currency which currently does not produce any investment interest. Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Interest income 29,501 136,057 83,849 293,359 Interest Expense Interest expense for the 2014 financial year relates to a 2.88% interest being charged on a short-term borrowing initiated in January 2014. In comparison, interest expense for the 2013 financial year relates to a 2.95% interest being charged on a short-term borrowing initiated in February 2013. Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Interest expense 4,771 5,660 11,133 11,320 Financing Costs In December 2013, UBS accessed new capital via a US$25,000,000 term loan facility of which US$15,000,000 was drawn in December 2013. The breakdown of the financing costs is as follows: Three Months Ended June 30, Six Months Ended June 30, 2014 2013 2014 2013 A$ A$ A$ A$ Interest expense 426,193 0 869,853 0 Warrants expense 43,539 0 88,362 0 Other debt issuance costs 163,897 0 332,685 0 633,629 0 1,290,900 0 27 -------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. Interest expense relates to applicable interest of 10.5% levied on the loan. The fair value of the warrant issued to the Lenders was estimated using the Trinomial Lattice model. The debt issuance costs were recorded as deferred issuance costs and are amortized as interest expense, using the effective interest method, over the term of the loan. Other The Company has recorded research and development tax incentive income of A$1,729,498 and A$3,720,149, respectively for the three and six months ended June 30, 2014 under this caption. The Company determined that it qualified and became eligible for this rebate during the third quarter of the 2013 financial year. The balance is primarily represented by foreign exchange movements arising from the settlement of foreign denominated transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies. The research and development tax incentive receivable has been recorded as "Other current assets" in the consolidated balance sheets. The research and development tax incentive is one of the key elements of the Australian Government's support for Australia's innovation system. It was developed to assist businesses recover some of the costs of undertaking research and development. The research and development tax incentive provides a tax offset to eligible companies that engage in research and development activities. Companies engaged in research and development may be eligible for either: • a 45% refundable tax offset for entities with an aggregated turnover of less than A$20 million per annum, or • a 40% non-refundable tax offset for all other entities. Critical Accounting Estimates and Judgments Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, income, costs and expenses, and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates. We believe that of our significant accounting policies, which are described in the notes to our consolidated financial statements, the following accounting policies involve a greater degree of judgment and complexity. Accordingly, we believe that the following accounting policies are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations. (a) Revenue Recognition The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, and collection is probable. Product is considered delivered to the customer once it has been shipped and title and risk of loss have been transferred. In addition, the Company enters into arrangements, which contain multiple revenue generating activities. The revenue for these arrangements is recognized as each activity is performed or delivered, based on the relative fair value and the allocation of revenue to all deliverables based on their relative selling price. In such circumstances, the Company uses a hierarchy to determine the selling price to be used for allocation of revenue to deliverables, vendor-specific objective evidence, third-party evidence of selling price and the Company's best estimate of selling price. The Company's process for determining its best estimate of selling price for deliverables without vendor-specific objective evidence or third-party evidence of selling price involves management's judgment. The Company's process considers multiple factors that may vary depending upon the unique facts and circumstances related to each deliverable. 28 -------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. (b) Stock-Based Compensation We account for stock-based employee compensation arrangements using the modified prospective method as prescribed in accordance with the provisions of ASC 718 - Compensation - Stock Compensation. Each of the inputs to the Trinomial Lattice model is discussed below. Share Price and Exercise Price at Valuation Date With the exception of ZEPOs, the exercise price of the options granted has been determined using the closing price of our common stock trading in the form of CDIs on ASX at the time of grant of the options. The exercise price of ZEPOs is nil. The ASX is the only exchange upon which our securities are quoted. Volatility We applied volatility having regard to the historical price change of our shares in the form of CDIs available from the ASX. Time to Expiry All options granted under our share option plan have a maximum 10 year term and are non-transferable. Risk Free Rate The risk free rate which we applied is equivalent to the yield on an Australian government bond with a time to expiry approximately equal to the expected time to expiry on the options being valued. (c) Income Taxes We apply ASC 740 - Income Taxes which establishes financial accounting and reporting standards for the effects of income taxes that result from a company's activities during the current and preceding years. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Where it is more likely than not that some portion or all of the deferred tax assets will not be realized, the deferred tax assets are reduced by a valuation allowance. The valuation allowance is sufficient to reduce the deferred tax assets to the amount that is more likely than not to be realized. (d) Impairment of Long-Lived Assets We review our capital assets, including patents and licenses, for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. In performing the review, we estimate undiscounted cash flows from products under development that are covered by these patents and licenses. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than the carrying amount of the asset. If the evaluation indicates that the carrying value of an asset is not recoverable from its undiscounted cash flows, an impairment loss is measured by comparing the carrying value of the asset to its fair value, based on discounted cash flows. 29 -------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. (e) Warrants In connection with our US$25 million loan facility, we issued to the Lenders warrants entitling the holder to purchase up to an aggregate total of 4.5 million shares of UBI's common stock in the form of CDIs at a price of A$1.00 per share. The fair value of the warrants to purchase common stock is estimated using the Trinomial Lattice model. Each of the inputs to the Trinomial Lattice model is discussed below. Share Price and Exercise Price at Valuation Date The share price of the warrants granted has been determined using the closing price of our common stock trading in the form of CDIs on ASX at the time of entering in to the loan facility. The ASX is the only exchange upon which our securities are quoted. The exercise price has been determined as stated in the credit agreement. Volatility We applied volatility having regard to the historical price change of our shares in the form of CDIs available from the ASX. Time to Expiry The warrants have a term of seven years. Risk Free Rate The risk free rate which we applied is equivalent to the yield on an Australian government bond with a time to expiry approximately equal to the expected time to expiry on the warrants to purchase common stock being valued. Financial Condition, Liquidity and Capital Resources Net Financial Assets Our net financial assets position is shown below: Six Months Ended Year Ended June 30, December 31, 2014 2013 A$ A$ Financial assets: Cash and cash equivalents 15,869,583 23,742,422 Accounts receivable 1,809,207 2,167,867 Total financial assets 17,678,790 25,910,289 Debt: Short term borrowings 165,832 0 Long term secured loan 15,149,260 15,857,966 Total debt 15,315,092 15,857,966 Net financial assets 2,363,698 10,052,323 Since inception, we have financed our business primarily through the issuance of equity securities, funding from strategic partners and government grants, revenue from services and product sales. On December 19, 2013 we entered into the Credit Agreement with the Lenders for a US$25 million secured term loan. The term loan has a maturity date of December 19, 2018 and bears interest at 10.5% per annum. Interest payments are due quarterly over the five-year term of the term loan and, other than as described elsewhere herein, we are not required to make payments of principal for amounts outstanding under the term loan until the Maturity Date. Subject to certain exceptions, the term loan is secured by substantially all of our assets, including our intellectual property. For further details, see Notes to Consolidated Financial Statements - Summary of Significant Accounting Policies. 30 -------------------------------------------------------------------------------- Table of Contents Universal Biosensors, Inc. We believe we have sufficient cash and cash equivalents to fund our operations for at least the next twelve months. The carrying value of the cash and cash equivalents and the accounts receivable approximates fair value because of their short-term nature. We regularly review all our financial assets for impairment. There were no impairments recognized for the six months ended June 30, 2014 and for the year ended December 31, 2013. Derivative Instruments and Hedging Activities In determining fair value, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as consider our own and counterparty credit risk. At June 30, 2014 and December 31, 2013, we did not have any assets or liabilities that utilize Level 3 inputs. The valuation of our foreign exchange derivatives is based on the market approach using observable market inputs, such as forward rates, and incorporates non-performance risk (the credit standing of the counterparty when the derivative is in a net asset position, and the credit standing of the Company when the derivative is in a net liability position). Our derivative assets are categorized as Level 2. We had no outstanding contracts as at June 30, 2014 and December 31, 2013. We recognized gains of nil for the periods ended June 30, 2014 and December 31, 2013. No amount of ineffectiveness was recorded in earnings for these designated cash flow hedges for the periods ended June 30, 2014 and December 31, 2013. For further details, see Notes to Consolidated Financial Statements - Summary of Significant Accounting Policies. Measures of Liquidity and Capital Resources The following table provides certain relevant measures of liquidity and capital resources: Six Months Ended Year Ended June 30, December 31, 2014 2013 A$ A$ Cash and cash equivalents 15,869,583 23,742,422 Working capital 23,043,046 30,367,292 Ratio of current assets to current liabilities 4.54 : 1 6.60 : 1 Shareholders' equity per common share 0.13 0.17 The movement in cash and cash equivalents and working capital during the above periods was primarily due to reductions resulting from outflows of cash and to the timing of cash receipts, payments, sales and accruals in the ordinary course of business. In addition to the reductions resulting from operating outflows of cash, a first tranche loan of US$15,000,000 (equivalent to A$16,909,029) was drawn in December 2013 by UBS pursuant to the Credit Agreement. We have not identified any collection issues with respect to receivables. Summary of Cash Flows |