Announcement PDF RECCE PHARMACEUTICALS LTD Appendix 4D Current Reporting Period: 31 December 2021 Previous Reporting Period: 31 December 2020 Results for Announcement to the Market Percentage Change Revenue from ordinary activities $ - 0.00% to - Loss from ordinary activities after tax attributable to members down -51.10% to (4,983,636) Net loss for the period attributable to members down -51.10% to (4,983,636) Brief explanation of Results Operational Report During the reporting period, significant advances were made in support of the development of the Company’s synthetic anti-infective program. Highlights for the half year to 31 December 2021 included: • Multiple patients dosed with RECCE® 327 in a topical Phase I/II clinical trial at the Fiona Stanley Hospital Burns unit • Trial registration for its lead compound RECCE® 327 in the Australian New Zealand Clinical Trial Registry (ANZCTR) for its Phase I Intravenous Study in Humans under the Trial ID ACTRN12621001313820p • Receiving Human Research Ethics Committee approval to start its Phase I intravenous (IV) clinical trial evaluating the safety and pharmacokinetics of its lead compound, RECCE® 327 • RECCE® 327 demonstrated broad spectrum antibiotic activity on bacterial infections in burns wounds with visible infection reduction in less than 24 hours on all patients to date. All infections were cleared within 5 days (acute) or 7 days (chronic) • Recruiting 10 healthy male subjects (first cohort) in its Phase I intravenous (IV) clinical trial of its lead compound, RECCE® 327 Appendix 4D Clinical Progress The Company successfully launched two clinical trials: a Sepsis focussed, Phase I intravenously administrated dose study assessing the safety and tolerability of RECCE® 327 (R327) in healthy subjects (CMAX, Royal Adelaide Hospital, South Australia) and a Phase I/II clinical trial for burn wound infections conducted at the Fiona Stanley Hospital, Western Australia. The Company completed the final administrative stages in preparation for its Phase I intravenous clinical trial of R327: trial registration in the Australian New Zealand Clinical Trial Registry (ANZCTR); Human Research Ethics Committee approval. Having achieved these important milestones, the first cohort of subjects for this clinical trial, assessing the safety and tolerability of R327, were recruited and dosed over two days starting 16 December 2021. In a parallel Phase I/II study, topical R327 on patients with burn wound infections were successfully treated, Gram-positive, Gram-negative and antibiotic-resistant (superbug) strains. Visible reductions in wound infections were reported within the first 24 hours of R327 treatment. Patients with acute wound infections also indicated a complete clinical response, requiring no further treatment. Patients suffering from chronic or significant surface area wounds showed similarly positive outcomes by day seven. With this compelling interim data, the study adopted a significantly shorter five day treatment in place of the original 14 day protocol. In support of these clinical advances, the Company was granted two further Patents in Family 3 – AntiVirus Agent and Method for Treatment of Viral Infection, one in the United States and the second in China – furthering marketing and manufacturing monopolies to February 2037. These patents in two major global pharmaceutical markets, greatly strengthens our intellectual patent portfolio, reinforcing the unique opportunities for novel treatment across a range of both bacterial and viral pathogens. The Company would like to thank shareholders for their support and looks forward to advancing these clinical programs over the time ahead. Strong financial position The Company’s cash position of $15.8 million at 31 December 2021 combined with available research and development rebate credits means Recce Pharmaceuticals is sufficiently funded to execute its development milestones through the 2022 financial year. The Company’s vision is to help address the urgent global health threat of antibiotic resistant superbugs and emerging viral pathogens. The team at Recce Pharmaceuticals will continue to embark on programs that bring that vision to reality. Financial Report The half-year operating loss for the period was $4,983,636 (2021: loss of $10,191,904). The decrease was as a result of decreased R&D related costs and no share based payment expenses. The loss per share for the period was 3.75 cents (2021: 7.68 cents). Dividends Amount per Security Nil Nil N/A N/A Final Dividend Interim Dividend Date the Dividend is Payable: Record Date for determining entitlements to the Dividends: Percentage Franked N/A N/A N/A N/A The Company did not declare a dividend during the financial period and has not declared a dividend since the end of the financial period. Net Tangible Assets per Security As at 31 December 2021 (cents) As at 31 December 2020 (cents) 8.93 13.43 The half year report is based on accounts that have been subject to an audit review and there is no dispute or qualification with the auditors in relation to these accounts. RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 INTERIM REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2021 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 TABLE OF CONTENTS PAGE 1 Directors' Report 1 2 Auditor's Independence Declaration 4 3 Consolidated Statement of Profit or Loss and Other Comprehensive Income 5 4 Consolidated Statement of Financial Position 6 5 Consolidated Statement of Changes in Equity 7 6 Consolidated Statement of Cash Flows 8 7 Notes to the Consolidated Financial Statements 9 8 Declaration by Directors 16 9 Independent Auditor's Review Report 17 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 DIRECTORS' REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2021 The Directors present their report together with the interim consolidated financial report of Recce Pharmaceuticals Ltd (the "Company") and controlled entities (the "Group") for the half-year ended 31 December 2021. Directors The following persons held office as Directors of the Company during the half-year and up to the date of this report: Dr John Prendergast Dr Alan Dunton Mr James Graham Ms Michele Dilizia Dr Justin Ward Non-Executive Chairman Non-Executive Director Managing Director and Chief Executive Officer Executive Director and Chief Scientific Officer Executive Director and Principal Quality Chemist Principal Activity The Group is pioneering the development and commercialisation of a new class of Synthetic AntiInfectives designed to address the urgent global health problems of antibiotic-resistant superbugs and emerging viral pathogens. Patented lead candidate RECCE® 327 as an intravenous therapy is being developed for treatment of serious and potentially life-threatening infections including sepsis due to Gram-positive and Gram-negative bacteria and their superbug forms. Review of Operations On 5 July 2021, the Company announced its first international cash receipt of A$176,870 from the Canadian Government as part of its Scientific Research & Experimental Development (SR&ED) Tax Incentive program. The Canadian government’s 10% Research and Development (R&D) rebate is in addition to the Australian government’s 43.5% R&D Tax Incentive Program. On 12 July 2021, the Company announced that multiple patients had been dosed with topical RECCE® 327 in a Phase I/II clinical trial, with no adverse symptoms reported, at the Fiona Stanley Hospital Burns Unit in Perth. The clinical trial is sponsored by the Western Australia Health Department. On 19 July 2021, the Company announced positive efficacy of RECCE® 327 against Clostridium perfringens (C. perfringens) and Streptococcus pyogenes (S. pyogenes) , two main strains of bacteria associated with necrotizing fasciitis, also known as ‘flesh-eating’ disease. RECCE® 327 demonstrated a Below Limit of Quantification (BLOQ) efficacy as early as 30 minutes in C. perfringens ; 99.9% (3-log) reduction achieved in all bacteria tested, at various concentrations. On 20 July 2021, the Company announced the Chinese Patent Office had granted Patent Family 3 “AntiVirus Agent and Method for Treatment of Viral Infections”, furthering marketing and manufacturing monopolies to February 2037. This was the third Patent in Family 3 to be granted to the Company following its patent grant in Europe and Japan, with applications in other major pharmaceutical markets around the world in advanced stages of independent patent reviews. 1 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 DIRECTORS' REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2021 Review of Operations (Continued) On 22 July 2021, the Company announced the United States (U.S.) Patent and Trademark Office had granted Patent Family 3 “Anti-Virus Agent and Method for Treatment of Viral Infections”, furthering marketing and manufacturing monopolies to February 2037. This was the fourth of five patents in Family 3 to be granted to the Company following its patent grants in the biggest pharmaceutical markets in the world: China, Japan, Europe, with only Australia remaining. On 11 August 2021, the Company announced it had been awarded the second grant from the Innovation Connections scheme of AUD $50,000 plus Goods and Services Tax (GST) under the Australian Government’s Entrepreneurs’ Programme. The Innovation Connections scheme assists businesses in establishing research priorities, locating researchers, and providing access to funding to enable R&D project. On 30 September 2021, the Company announced trial registration for its lead compound RECCE® 327 in the Australian New Zealand Clinical Trial Registry (ANZCTR) for its Phase I Intravenous Study in Humans under the Trial ID ACTRN12621001313820p. On 25 October 2021, the Company announced it had received Human Research Ethics Committee approval to start its Phase I Intravenous clinical trial evaluating the safety and pharmacokinetics of its lead compound, RECCE® 327. On 8 November 2021, the Company announced it was to deliver the Opening R&D Address at the World Anti-Microbial Resistance Congress on 8th-9th November 2021 highlighting the urgent need for new antibiotics to address the rapidly growing threat of antimicrobial-resistance. On 7th December 2021, the Company announced an update on its Phase I/II clinical trial. RECCE® 327 demonstrated broad spectrum antibiotic activity on bacterial infections in burn wounds with visible infection reduction less than 24 hours on all patients to date. All infections were cleared within 5 days (acute) or 7 days (chronic); clinicians reducing treatment windows per protocol/positive patient indications. Burn wound infections consisted of Gram-positive and Gram-negative bacteria, some of which are defined as multidrug- resistant and categorised as difficult to treat due to biofilms. On 15 December 2021, the Company announced it had recruited 10 healthy male subjects (first cohort) in its Phase I intravenous (IV) clinical trial of its lead compound, RECCE® 327. Dosing commenced shortly thereafter. Results of Operations The half-year operating loss for the period was $4,983,636 (2020: loss of $10,191,904). The decrease was as a result of decreased R&D related costs and no share based payments. The Group's current focus is on progressing RECCE® 327 into human clinical trials. 2 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 DIRECTORS' REPORT FOR THE HALF YEAR ENDED 31 DECEMBER 2021 Events Subsequent to Reporting Period No matters or circumstances have arisen since the end of the financial period, which significantly affected, or may significantly affect, the operations of the Group, the results of those operations, or state of affairs of the Group in future financial periods. Rounding of amounts In accordance with ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191, the amounts in the Directors' Report have been rounded to the nearest dollar, unless otherwise Auditor's independence declaration A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 5. This report is made in accordance with a resolution of the Board of Directors. Dr John Prendergast Non-Executive Chairman 28 February 2022 3 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 Auditor's Independence Declaration To be provided by the auditor 4 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 31 DECEMBER 2021 Note Revenue Other income Research and Development ("R&D") tax incentive Interest income Other income - cashflow boost Expenses Laboratory expenses Employee benefits expenses Depreciation and amortisation expenses Share based payments expense Travel expenses Patent related costs Rental outgoing expenses Finance costs Professional services Other expenses Amortisation: Leases Interest expenses: Leases Loss before income tax 31 December 2021 $ - 31 December 2020 $ - 53,281 53,281 640,049 36,587 55,000 731,636 (2,417,640) (1,257,463) (25,815) (58,653) (45,376) (17,245) (630) (307,399) (818,181) (82,447) (6,069) (5,036,917) (3,876,549) (1,012,550) (29,582) (4,732,069) (2,245) (42,220) (14,548) (1,279) (413,699) (733,812) (61,025) (3,962) (10,923,540) (4,983,636) (10,191,904) - - (4,983,636) (10,191,904) - - (4,983,636) (10,191,904) Income tax expense Loss for the period after income tax Other comprehensive income Total comprehensive loss for the period Cents Cents Loss per share: Basic loss per share for the period Diluted loss per share for the period 6 6 (3.75) (3.75) (7.68) (7.68) Dividends per share for the period 7 - - The accompanying condensed notes form part of these consolidated financial statements. 5 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2021 Note ASSETS CURRENT ASSETS Cash and cash equivalents Trade and other receivables Other current assets TOTAL CURRENT ASSETS 8 31 December 2021 $ 30 June 2021 $ 15,825,786 105,139 343,602 16,274,527 20,873,040 245,484 62,399 21,180,923 362,662 124,264 486,926 379,397 121,235 500,632 16,761,453 21,681,555 834,506 178,073 100,155 1,112,734 627,903 337,747 112,585 1,078,235 31,238 97,375 128,613 14,364 85,215 99,579 TOTAL LIABILITIES 1,241,347 1,177,814 NET ASSETS 15,520,106 20,503,741 43,297,309 8,678,058 (36,455,261) 43,297,309 8,678,057 (31,471,625) 15,520,106 20,503,741 9 NON-CURRENT ASSETS Plant and equipment Right of Use Asset TOTAL NON-CURRENT ASSETS 10 11 TOTAL ASSETS LIABILITIES CURRENT LIABILITIES Trade and Other Payables Provisions for employee benefits Current lease liabilities TOTAL CURRENT LIABILITIES 12 NON-CURRENT LIABILITIES Non-current lease liabilities Provisions for employee benefits TOTAL NON-CURRENT LIABILITIES EQUITY Share capital Reserves Accumulated losses 13 14 TOTAL EQUITY The accompanying condensed notes form part of these consolidated financial statements. 6 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2021 Total $ Accumulated Losses $ 18,466,336 1,804,502 (17,958,259) 2,312,579 - - (10,191,904) (10,191,904) (10,191,904) (10,191,904) 26,231,325 (3,018,244) 247,118 66,900 1,220,699 24,747,798 4,665,169 3,018,244 (1,220,699) 6,462,714 - 26,231,325 4,665,169 247,119 66,900 31,210,514 BALANCE AT 31 DECEMBER 2020 43,214,134 8,267,216 (28,150,163) 23,331,189 BALANCE AT 1 JULY 2021 43,297,309 8,678,057 (31,471,625) 20,503,742 - - (4,983,636) (4,983,636) (4,983,636) (4,983,636) - - - - 43,297,309 8,678,057 (36,455,261) 15,520,106 BALANCE AT 1 JULY 2020 Share Capital $ Reserves COMPREHENSIVE INCOME: Loss for the period Other comprehensive income $ TRANSACTIONS WITH OWNERS IN THEIR CAPACITY AS OWNERS: Issuance of shares (net of cash-settled share issue costs) Options issued to Directors Options issued to lead manager as capital raising cost Conversion of options into ordinary shares Share-based payments Transfers from reserves to share capital COMPREHENSIVE INCOME: Loss for the period Other comprehensive income TRANSACTIONS WITH OWNERS IN THEIR CAPACITY AS OWNERS: Issuance of shares (net of cash-settled share issue costs) (Note 13) Options issued to Directors Options issued to lead manager as capital raising cost Conversion of options into ordinary shares Share-based payments Transfers from reserves to share capital BALANCE AT 31 DECEMBER 2021 The accompanying condensed notes form part of these consolidated financial statements. 7 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF-YEAR ENDED 31 DECEMBER 2021 31 December 2021 $ 31 December 2020 $ CASH FLOWS FROM OPERATING ACTIVITIES Receipts from Australian Taxation Office Payments to suppliers and employees Interest received Interest and other costs of finance paid NET CASH USED IN OPERATING ACTIVITIES (4,792,477) 53,281 (630) (4,739,826) 695,047 (6,048,648) 36,587 (1,279) (5,318,293) CASH FLOWS FROM INVESTING ACTIVITIES Purchases of plant and equipment Other related payments NET CASH USED IN INVESTING ACTIVITIES (9,078) (298,332) (307,410) (6,937) (41,161) (48,098) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of equity securities Proceeds from exercise of options Transaction costs related to issues of equity or convertible securities NET CASH PROVIDED BY FINANCING ACTIVITIES - 27,950,000 101,237 (1,718,675) 26,332,562 Net increase in cash and cash equivalents held (5,047,236) 20,966,171 Cash and cash equivalent at the beginning of the period 20,873,022 2,633,122 CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 15,825,786 23,599,293 The accompanying condensed notes form part of these consolidated financial statements. 8 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2021 NOTE 1: GENERAL INFORMATION The consolidated financial report of Recce Pharmaceuticals Ltd (the "Company") and its controlled entities (the "Group") for the half year ended 31 December 2021 was authorised for issue in accordance with a resolution of the Directors on 28 February 2022. The Company is a company limited by shares incorporated and domiciled in Australia whose shares are publicly trade on the Australian Securities Exchange ("ASX"). NOTE 2: ACCOUNTING POLICIES (a) Basis of preparation of the consolidated financial report These financial statements are general purpose financial statements for the half year ended 31 December 2021 have been prepared in accordance with Australian Accounting Standards 134 Interim Financial Reporting and the Corporations Act 2001. The half year consolidated financial report does not include all notes of the type normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the Company as the full financial report. Accordingly, the half-year consolidated financial report should be read in conjunction with the annual report for the year ended 30 June 2021 and considered together with any public announcements made by the Company during the half year ended 31 December 2021 in accordance with the continuous disclosure obligations of the ASX Listing Rules and the Corporations Act 2001. Historical Cost Convention The consolidated financial statements have been prepared on an accrual basis and are based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities. (b) Adoption of new and revised standards The Group has reviewed all of the new and revised standards and interpretations issued by the Australian Accounting Standards Board that are relevant to its operations and effective for the current half-year. The Group has also reviewed all standards and interpretations that have been issued but are not yet effective for the half-year ended 31 December 2021. As a result of this review, the Directors have determined that there is no material impact on the Group and, therefore no material change is necessary to Group accounting policies. (c) Rounding of amounts to nearest dollar In accordance with ASIC Corporations (Rounding of Financial/Directors' Reports) Instrument 2016/191, the amounts in the consolidated financial report have been rounded to the nearest dollar. NOTE 3: CRITICAL ACCOUNTING JUDGEMENTS AND SOURCES OF ESTIMATION UNCERTAINTY The preparation of the consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts in the consolidated financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and assumptions on historical experience and on other various factors, including expectations of future events, management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are discussed below. 9 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2021 NOTE 3: CRITICAL ACCOUNTING JUDGEMENTS AND SOURCES OF ESTIMATION UNCERTAINTY (Continued) Recovery of deferred tax assets Deferred tax assets are recognised for deductible temporary differences only if the Group considers it is probable that future taxable amounts will be available to utilise those temporary differences and losses. At 31 December 2021, no deferred tax assets on temporary differences and carry forward losses were recognised. Share-based payment transactions The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by using either the Trinomial or Black-Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting year but may impact profit or loss and equity. NOTE 4: GOING CONCERN For the half-year ended 31 December 2021 the Group recorded a loss of $4,983,636 (2020: $10,191,904) and had net cash outflows from operating activities of $4,772,599 (2020: $5,318,293). On 30 September 2020 the Company raised $27.95 million from the issue of 21.5 million ordinary shares at $1.30 (before capital raising costs). The Group currently has sufficient cash resources to fund its operations for the foreseeable future. The directors have reviewed the Group’s financial position and are of the opinion that there are sufficient funds to meet the Group’s working capital requirements and as at the date of this report. NOTE 5: SEGMENT INFORMATION (a) Reportable segments The Directors have considered the requirements of AASB 8 Operating Segments and the internal reports that are reviewed by the chief operating decision maker (the Board of Directors) in allocating resources and have concluded that at this time there are no separate identifiable segments as the Group operates in only one business segment being research and development of pharmaceutical drugs. However, the Group operates in three geographic segments being Australia, Canada and the USA. (b) Segment results The following is an analysis of the Group’s results by reportable segments: Australia USA Europe Canada Central Administration Segment revenue and other income for the period 31 December 31 December 2021 2020 $ $ 19,206 228,078 12,154 221,579 1,626 246 168 281,734 20,126 53,281 731,636 10 Segment loss after tax for the period 31 December 2021 $ (1,796,436) (1,136,820) (152,131) (15,748) (1,882,500) (4,983,635) 31 December 2020 $ (1,190,543) (1,164,972) (1,292) (1,481,246) (6,353,851) (10,191,904) RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2021 NOTE 5: SEGMENT INFORMATION (Continued) The segment revenue and other income above comprises bank interest. The accounting policies of the reportable segments are the same as the Group’s accounting policies described in the Group’s 30 June 2021 notes to the consolidated financial statements. Segment loss represents the loss after tax incurred by each segment. This is the measure reported to the Board of Directors for the purposes of resource allocation and assessment of segment performance. (c) Segment assets and liabilities Australia USA Europe Canada Central Administration Segment assets at end of the period 31 December 30 June 2021 2021 $ $ 339,085 357,577 16,422,368 21,323,978 16,761,453 21,681,555 Segment liabilities at end of the period 31 December 30 June 2021 2021 $ $ 1,241,347 1,177,814 1,241,347 1,177,814 31 December 2021 $ 339,085 15,181,021 15,520,106 (d) Segment net assets Australia USA Europe Canada Central Administration 11 30 June 2021 $ 357,578 20,146,163 20,503,741 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2021 NOTE 6: LOSS PER SHARE The following reflects the loss and share data used in the calculations of basic and diluted losses per share: Loss for the period attributable to the members of the parent Weighted average number of shares: Weighted average number of ordinary shares used in calculating basic loss per share Effect of dilutive securities: Adjusted weighted average number of ordinary shares used in calculating diluted loss per share Loss per share (cents per share): Basic loss per share for the period Diluted loss per share for the period 31 December 2021 $ (4,983,636) 31 December 2020 $ (10,191,904) 132,764,977 132,764,977 132,764,977 132,764,977 (3.75) (3.75) (7.68) (7.68) NOTE 7: DIVIDENDS PAID AND PROPOSED The Company had not declared any dividends during and/or since the end of the half-year 31 December 2021 (31 December 2020: $nil). 31 December 2021 NOTE 8: CASH AND CASH EQUIVALENTS Cash at bank Cash on hand 15,825,769 17 15,825,786 30 June 2021 20,873,023 17 20,873,040 NOTE 9: OTHER CURRENT ASSETS $ 25,170 20,101 298,332 343,602 Prepayments Rental Deposits Director Advances 12 $ 2,106 20,100 40,193 62,399 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2021 NOTE 10: PLANT AND EQUIPMENT 31 December 2021 NON-CURRENT Laboratory plant and equipment At cost Less accumulated depreciation Office furniture and equipment At cost Less accumulated depreciation Computer equipment At cost Less accumulated depreciation Office improvements At cost Less accumulated depreciation Library and website costs At cost Less accumulated depreciation Total Plant and Equipment 30 June 2021 530,462 (235,896) 294,566 530,462 (218,722) 311,740 55,776 (39,078) 16,698 49,497 (32,697) 16,800 43,652 (36,817) 6,835 40,853 (35,887) 4,966 78,646 (35,316) 43,330 78,646 (34,132) 44,514 7,176 (5,943) 1,233 7,176 (5,799) 1,377 362,662 379,397 Reconciliations Movement in the carrying amounts of the plant and equipment between the beginning and the end of the current financial period. $ Opening balance, 1 July 2021 379,397 Additions 9,078 Depreciation expense (25,813) Ending balance, 31 December 2021 362,662 NOTE 11: NON-CURRENT ASSETS - RIGHT-OF-USE ASSETS Land and buildings - right-of-use Less: Accumulated depreciation 124,264 (31,238) 93,026 13 295,939 (174,704) 121,235 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2021 31 December 2021 $ NOTE 12: TRADE AND OTHER PAYABLES CURRENT Trade payables Employee related payables Sundry creditors Other Payables 30 June 2021 $ 592,130 158,192 55,180 29,004 834,506 487,321 52,582 53,500 34,500 627,903 NOTE 13: SHARE CAPITAL 31 December 2021 No. $ Issued and fully paid ordinary shares Collateral shares issued in trust 30 June 2021 No. $ 173,777,847 173,777,847 43,297,309 43,297,309 173,777,847 173,777,847 43,297,309 43,297,309 173,777,847 43,297,309 136,071,787 18,466,336 - - - - 78,272 14,796,348 21,500,000 1,331,440 86,268 1,220,699 23,213,081 255,249 37,706,060 24,775,297 Movements in ordinary shares on issue Opening balance Shares issued during the period: - shares issued to consultants/KMP - Conversion of performance shares - Acuity Placement Deed - new shares issued from placement (net costs) - new shares issued on options exercised Transfer from reserves to share capital Total - - - - 55,676 173,777,847 43,297,309 173,777,847 55,676 43,297,309 Exercise Date Exercise Price cents 16.80 31.20 156.00 156.00 31 December 2021 No. 1,107,400 1,250,000 3,750,000 8,415,000 30 June 2021 No. 1,117,400 1,250,000 3,750,000 8,415,000 14,522,400 14,532,400 (c) Options from shares issued Particulars Issue Date Options Options Options Options 15-Feb-19 19-Dec-19 23-Sep-20 30-Sep-20 15-Feb-23 19-Feb-23 23-Sep-25 30-Sep-23 14 RECCE PHARMACEUTICALS LTD ABN 73 124 849 065 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2021 31 December 2021 $ NOTE 14: RESERVES 30 June 2021 $ 223,782 8,454,276 8,678,058 Performance shares reserve Share