6-K: Report of foreign issuer [Rules 13a-16 and 15d-16]
Published on
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
______________________________________________
Form
6-K
REPORT
OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE
SECURITIES
EXCHANGE ACT OF 1934
For
the
month of February, 2007
Commission
File Number ________________
Novogen
Limited
(Translation
of registrant’s name into English)
140
Wicks
Road, North Ryde, NSW, Australia
(Address
of principal executive office)
___________________________________
Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.
Form
20-F
x Form
40-F
o
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(l):
Note:
Regulation S-T Rule 101 (b)( I) only permits the submission in paper of a Form
6-K if submitted solely to provide an attached annual report to security
holders.
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule lO1(b)(7):
Note:
Regulation S-T Rule l01(b)(7) only permits the submission in paper of a Form
6-K
if submitted to furnish a report or other document that the registrant foreign
private issuer must furnish and make public under the laws of the jurisdiction
in which the registrant is incorporated, domiciled or legally organized (the
registrant’s “home country”), or under the rules of the home country exchange on
which the registrant’s securities are traded, as long as the report or other
document is not a press release, is not required to be and has not been
distributed to the registrant’s security holders, and, if discussing a material
event, has already been the subject of a Form 6-K submission or other Commission
filing on EDGAR.
Indicate
by check mark whether the registrant by furnishing the information contained
in
this Form is also thereby furnishing the information to the Commission pursuant
to Rule l2g3-2(b) under the Securities Exchange Act of 1934. Yes o No
x
If
“Yes”
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by
the
undersigned, thereunto duly authorized.
Novogen
Limited
(Registrant)
/s/
Ron Erratt
Ronald
Lea Erratt
Company
Secretary
Date
28 February, 2007
NOVOGEN
LIMITED
ABN
37-063-259-754
www.novogen.com
140
Wicks
Road, NORTH RYDE, NSW
2113
Telephone:
02 9878 0088
APPENDIX
4D
incorporating
INTERIM
FINANCIAL REPORT
FOR
THE HALF-YEAR
31
DECEMBER 2006
Lodged
with the ASX under Listing Rule 4.2A
This is a half-yearly report. It is to be read in conjunction with the most
recent annual financial report.
Novogen
Limited
Appendix
4D Specific Requirements
31
December 2006
RESULTS
FOR ANNOUNCEMENT TO THE MARKET
$‘000
|
Revenues
from ordinary activities
|
up
|
21.0
|
%
|
to
|
10,488
|
||||||||
|
Loss
from ordinary activities after tax attributable
|
|||||||||||||
|
to
members
|
up
|
61.0
|
%
|
to
|
(10,557
|
)
|
|||||||
|
Loss
from extraordinary items after tax attributable
|
|||||||||||||
|
to
members
|
N/A
|
-
|
to
|
-
|
|||||||||
|
Net
Loss for the period attributable to members
|
up
|
61.0
|
%
|
to
|
(10,557
|
)
|
The
Directors do not propose to pay a dividend.
Refer
to
Review of Operations shown in the attached Directors’ Report for an explanation
of the above disclosures.
1
Novogen
Limited
Directors’
Report
31
December 2006
Directors’
report for the half-year 31 December, 2006
Your
directors submit their report for the half-year ended 31 December,
2006.
Directors
The
names
and qualifications of the directors that held office during the half-year
and up
to the date of this report, unless otherwise indicated, are as
follows:-
Mr
P A
Johnston,
Chairman and Non-Executive Director - Dip Eng (Production)
Mr
C
Naughton,
Managing Director - BEc, LLB
Professor
A J Husband, Executive
Director - PhD, DSc, FASM
Professor
P J Nestel AO,
Non-Executive Director - MD, FTSE, FRACP, FAHA
Mr
P B
Simpson,
Non-Executive Director - MPharm, PhC
Dr
L C
Read,
Non-Executive Director - BAgSc (Hons), PhD, FTSE (resigned
30 January, 2007)
Mr
G
Leppinus,
Non-Executive Director - BEc, FCA
Review
of operations
Cash
Resources
At
the
end of December 2006, the Company had $46.3 million in cash resources
available
to fund the drug development program and for ongoing business requirements.
In
July,
2006, Novogen’s subsidiary, Marshall Edwards, Inc (“MEI”) received net proceeds
of $US16.9 million following the private placement of 6,329,311 shares
and
2,215,258 warrants.
MEI
also
announced that it had entered into a standby equity distribution agreement
(SEDA), with Cornell Capital Partners, LP enabling it sell to Cornell
shares of
its common stock for a total purchase price of up to $US15 million. At
the date
of this report, MEI had not issued any shares of its common stock under
the
terms of the SEDA.
During
the six months ended 31 December, 2006 the Company received $0.5 million
from
the exercise of options, issued under the staff option plan.
Net
Loss
The
net
loss attributable to members, after allocating outside equity interests,
increased by $4.0 million or 61% to $10.6 million in the six months ended
31
December, 2006 from a loss of $6.6 million in the previous corresponding
period.
The
net
loss for the period after income tax for the consolidated group for the
six
months to 31 December, 2006 increased by $6.3 million to $13.6 million
from $7.3
million for the same period last year. The increase in our net loss for
the six
months ended 31 December, 2006 was due to increased consumer product
manufacturing costs associates with lower production volumes of consumer
products, an increase in research and development expenses mostly associated
with the Ovature clinical trial, increased administration expenses and
increased
selling and promotional expenses. These expenses were partially offset
by
increased revenue from royalty and licence fee income and Government
grants,.
Revenue
The
Company earned revenue for the six months ended 31 December 2006 of $10.5
million, an increase of $1.8 million from $8.7 million for the same period
last
year. The increase in revenue included an increase in royalties and licence
fees
of $1.3 million including milestone royalty payments due under a license
agreement with Archer Daniels Midland Company (ADM) (licence transferred
from
“The Solae Company”) and amounts received from the licensed rights to Promensil
and
2
Novogen
Limited
Directors’
Report
31
December 2006
Trinovin
brands in the U.S. to Natrol, Inc. Other revenues also increased by $0.6
million
from the sale of red clover inventories which were excess to our production
requirements and amounts received from Sante Naturelle for a licence
and
settlement of a patent infringement case relating to consumer products
in
Canada. Interest on cash balances increased by $0.2 million to $1.0 million
for
the six months ended 31 December, 2006 from $0.8 million for the six
months
ended 31 December, 2005.
Sales
of
consumer products decreased by $0.2 million to $6.2 million for the six
months
ended 31 December, 2006 from $6.4 million for the six months ended 31
December,
2005. Following the licence of Promensil and Trinovin brands in the U.S.
to
Natrol, Inc. we expect that in future profitability will be improved
in the
consumer products business segment.
Sales
revenue in Australasia for the six months ended 31 December, 2006 were
down $0.3
million to $2.1 million from $2.4 million for the same period last year
due to
de-stocking in the wholesaler supply channels. Sales revenue in North
America
was $2.5 million for the four months ending October 2006 (U.S. consumer
products
were licensed to Natrol Inc from the end of October 2006) down from $2.6
million
for the six month period to December 31 last year. Sales revenue in Europe
increased by $0.2 million to $1.6 million for the six months up from
$1.4
million for the same period last year.
Other
income
Other
income increased by $1.4 million for the six months ended 31 December,
2006 due
to Australian Government grant income from the Company’s participation in the
Pharmaceutical Partnership Program (P3).
Expenses
Total
expenses increased by $9.6 million to $25.5 million for the six months
ended 31
December, 2006 from $15.9 million for the six months ended 31 December,
2005.
Cost of Goods Sold increased by $1.8 million due to increased product
manufacturing costs associates with lower consumer products production
volumes.
Selling and promotion expenses were $0.5 million higher than for the
same period
last year representing increased advertising and promotional expenditure
predominantly in Canada and the U.K. markets. Research and development
expenses
increased by $3.0 million compared to the corresponding period last year.
The
increase was primarily due to expenses associated with the Phase III
Ovature
clinical trial being conducted by MEI. Costs were also incurred in connection
with production scale up activities of phenoxodiol and manufacture of
clinical
trial drug supplies. Research and development expenses also reflected
an
increase in costs associated with pre clinical development of glucoprime
the
Company’s Glucan based product being developed by Novogen’s subsidiary Glycotex,
Inc. Administrative and other Expenses increased by $3.8 million (excluding
net
currency gains/losses). The increase in administration expenses included
$2.1
million representing non-cash, share based payments incurred by MEI in
establishing the SEDA with Cornell Capital Partners and a $1.4 million
employee
termination payment. The net loss was also unfavorably affected by currency
movements of $0.5 million in the six months ended 31 December, 2006 versus
the
previous corresponding period.
Corporate
Developments
On
11
July, 2006, MEI announced that it had entered into a securities purchase
agreement with certain accredited investors providing for the placement
of
6,329,311 shares of its common stock and warrants exercisable for 2,215,258
shares of its common stock at a purchase price of $US2.90 per unit. The
warrants
have an exercise price of $US4.35 per share, subject to certain adjustments.
The
warrants may be exercised no less than six months from the closing date
and will
expire four years from the date of issuance, or 11 July, 2010. MEI closed
the
private placement on 11 July, 2006.
On
11
July, 2006, MEI also announced that it had entered into a standby equity
distribution agreement (SEDA), with Cornell Capital Partners, LP. Under
the
SEDA, MEI may issue and sell to Cornell shares of its common stock for
a total
purchase price of up to $US15 million, once a resale registration statement
is
in effect. MEI has sole discretion whether and when to sell shares of
its common
stock to Cornell. Cornell will be irrevocably bound to purchase shares
of common
stock from MEI after MEI sends a notice that it intends
to sell shares of common stock to Cornell. Each advance under the SEDA
is
limited to a maximum of $US1.5 million.
3
Novogen
Limited
Directors’
Report
31
December 2006
In
October 2006 the Company announced that it had licensed the U.S. rights
to its
Promensil and Trinovin brands to Natrol, Inc. Natrol, Inc will provide
the
brands critical mass and marketing expertise. The license also provides
for
possible future royalties upon achievement of certain sales volumes by
Natrol,
Inc.
Also
in
October 2006, MEI announced that it had appointed JP Morgan as its exclusive
financial advisor to provide advice on the strategic alternatives for
phenoxodiol which has now entered Phase III clinical testing. This appointment
is in line with our strategy to seek strategic partners for the future
commercial development of phenoxodiol.
In
2004
the Company was notified by the Therapeutic Goods Administration (TGA)
that it
was reviewing the current listing status of its dietary supplements products
in
Australia. These products are currently listed as “AUSTL” listed complementary
medicine. The Company believes that its products qualify for their current
listing status as “AUSTL” listed complementary medicines and the Company has
submitted supporting data to the TGA. In the event of a determination
by the TGA
that the products are not correctly listed the Company will consider
what
further appropriate actions are available.
Clinical
Trial Developments
Major
advances were made during the six months ended 31 December, 2006 and
up to the
date of this report.
The
Company announced in August 2006 that its investigational anti inflammatory
compound NV-52 had entered its second human clinical study. NV-52 is
being
developed to target inflammatory bowel disease. The study seeks to extend
the
compound’s safety data as well testing the ability of the drug to change certain
inflammatory markers in the serum.
In
September 2006, MEI announced that a new study conducted at Purdue University
in
the United States had obtained results supporting that phenoxodiol specifically
targets a protein on prostate cancer cells known as tNOX 75 alpha, a
protein
that appears to be selective for prostate cancer.
In
November 2006, MEI announced that the first patient had been treated
in the
Phase III ovarian cancer trial. The trial is being conducted under arrangements
approved by the U.S. Food and Drug Administration (FDA) known as a Special
Protocol Assessment (SPA). This SPA allows for the interim analysis of
the study
results after 95 patients have progressed with their disease. The total
number
of patients to be treated in this study is 470, with half to be on a
treatment
regime of phenoxodiol and the chemotherapeutic drug carboplatin, and
half on a
placebo and carboplatin.
Intellectual
Property Development
During
the six months ended 31 December 2006, 7 patents were granted over the
Company’s
intellectual property.
These
grants bring the total number of issued Company patents to 68.
In
December 2006, the Company announced that it had recently obtained allowance
in
the United States for patent claims to pharmaceutical compositions of
the
anti-cancer drug candidate phenoxodiol. The U.S. Patent and Trademark
Office has
allowed for grant claims to pharmaceutical compositions and unit dose
forms of
various substituted isoflav-3-enes, (including phenoxodiol). When granted,
this
patent will significantly add to the Company’s intellectual property portfolio
surrounding phenoxodiol.
4
Novogen
Limited
Directors’
Report
31
December 2006
Dividends
Paid or Recommended
The
Directors of Novogen Limited do not recommend the payment of a dividend.
No
dividends were declared or paid during the six months ended 31 December,
2006.
Auditor's
Independence Declaration
A
copy of
the Auditor's independence declaration as required under section 307C
of the
Corporations Act 2001 is included following the Directors' Report.
Rounding
The
amounts and figures shown in this report have been rounded to the nearest
thousand dollars (where rounding is applicable) under the option available
to
the Company under ASIC Class Order 98/0100. The Company is an entity
to which
the Class Order applies.
Signed
in
accordance with a resolution of the directors on behalf of the
board.
/s/
C
Naughton
C
Naughton
Managing
Director
Sydney,
27 February, 2007
5
Novogen
Limited
Auditor’s
Independence Declaration
31
December 2006
 |
Chartered
Accountants
&
Advisers
|
Level
19, 2 Market Street Sydney NSW 2000
GPO
Box 2551 Sydney NSW 2001
Tel.
+61 2 9286 5555 Fax +61 2 9286 5599
Email:
bdosyd@bdosyd.com.au
www.bdo.com.au
|
DECLARATION
OF INDEPENDENCE OF WAYNE BASFORD TO THE DIRECTORS OF NOVOGEN
LIMITED
To
the
best of my knowledge and belief there have been:
| · |
no
contraventions of the auditor independence requirements of the
Corporations Act 2001 in relation to the review; and
|
| · |
no
contraventions of any applicable code of professional conduct in
relation
to the review.
|
/s/
Wayne
Basford
Wayne
Basford
Partner
/s/
BDO
BDO
Chartered
Accountants
Dated
Sydney, this 27th day of February 2007
6
Novogen
Limited
Condensed
Income Statement
For
the half-year ended 31 December 2006
|
Notes
|
Consolidated
|
|||||||||
|
2006
|
|
|
2005
|
|
||||||
|
|
|
|
|
|
|
$'000
|
|
|
$'000
|
|
|
Revenue
|
2
|
10,488
|
8,670
|
|||||||
|
Other
Income
|
2
|
1,347
|
(33
|
)
|
||||||
|
Expenses
|
2
|
(25,449
|
)
|
(15,890
|
)
|
|||||
|
Finance
costs
|
-
|
(13
|
)
|
|||||||
|
Loss
before income tax
|
(13,614
|
)
|
(7,266
|
)
|
||||||
|
Income
tax expense
|
(1
|
)
|
-
|
|||||||
|
Loss
after tax from continuing operations
|
(13,615
|
)
|
(7,266
|
)
|
||||||
|
Loss
for the period
|
(13,615
|
)
|
(7,266
|
)
|
||||||
|
Loss
attributable to minority equity interest
|
3,058
|
719
|
||||||||
|
Loss
attributable to members of Novogen Limted
|
(10,557
|
)
|
(6,547
|
)
|
||||||
|
Basic
and Diluted Earnings per share (cents)
|
(10.8
|
)
|
(6.7
|
)
|
||||||
The
above condensed income statement should be read in conjunction with the
accompanying notes.
7
Novogen
Limited
Condensed
Balance Sheet
31
December 2006
|
Consolidated
|
|||||||
|
December
|
|
June
|
|
||||
|
|
|
2006
|
|
2006
|
|
||
|
|
|
$'000
|
|
$'000
|
|
||
|
CURRENT
ASSETS
|
|||||||
|
Cash
and cash equivalents
|
46,315
|
33,513
|
|||||
|
Trade
and other receivables
|
4,906
|
4,030
|
|||||
|
Inventories
|
3,950
|
5,522
|
|||||
|
Other
current assets
|
587
|
685
|
|||||
|
Total
Current Assets
|
55,758
|
43,750
|
|||||
|
NON-CURRENT
ASSETS
|
|||||||
|
Inventories
|
2,098
|
2,864
|
|||||
|
Property,
plant and equipment
|
4,140
|
4,484
|
|||||
|
Other
financial assets
|
-
|
-
|
|||||
|
Total
Non-Current Assets
|
6,238
|
7,348
|
|||||
|
TOTAL
ASSETS
|
61,996
|
51,098
|
|||||
|
CURRENT
LIABILITIES
|
|||||||
|
Trade
and other payables
|
6,379
|
5,646
|
|||||
|
Interest
bearing loans and borrowings
|
-
|
15
|
|||||
|
Provisions
|
582
|
520
|
|||||
|
Total
Current Liabilities
|
6,961
|
6,181
|
|||||
|
NON-CURRENT
LIABILITIES
|
|||||||
|
Provisions
|
350
|
339
|
|||||
|
Total
Non-Current Liabilities
|
350
|
339
|
|||||
|
TOTAL
LIABILITIES
|
7,311
|
6,520
|
|||||
|
NET
ASSETS
|
54,685
|
44,578
|
|||||
|
EQUITY
|
|||||||
|
Contributed
equity
|
190,503
|
176,989
|
|||||
|
Reserves
|
(3,842
|
)
|
(2,847
|
)
|
|||
|
Accumulated
losses
|
(137,187
|
)
|
(131,700
|
)
|
|||
|
Parent
interest
|
49,474
|
42,442
|
|||||
|
Minority
interest
|
5,211
|
2,136
|
|||||
|
TOTAL
EQUITY
|
54,685
|
44,578
|
|||||
The
above condensed balance sheet should be read in conjunction with the
accompanying notes.
8
Novogen
Limited
Condensed
Statement of Changes in Equity
For
the half-year ended 31 December 2006
|
Contributed
Equity
|
|
Accumulated
losses
|
|
Other
reserves
|
|
Total
|
|
Outside
equity
interest
|
|
Total
equity
|
|
||||||||
|
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|||||||
|
At
1 July 2005
|
176,235
|
(116,069
|
)
|
(3,413
|
)
|
56,753
|
3,739
|
60,492
|
|||||||||||
|
Options
exercised (1)
|
672
|
672
|
-
|
672
|
|||||||||||||||
|
Loss
for the period
|
(6,547
|
)
|
(6,547
|
)
|
(719
|
)
|
(7,266
|
)
|
|||||||||||
|
Exchange
differences on translation of foreign operations
|
987
|
987
|
156
|
1,143
|
|||||||||||||||
|
Share-based
payments
|
233
|
233
|
233
|
||||||||||||||||
|
At
31 December 2005
|
176,907
|
(122,383
|
)
|
(2,426
|
)
|
52,098
|
3,176
|
55,274
|
|||||||||||
|
At
1 July 2006
|
176,989
|
(131,700
|
)
|
(2,847
|
)
|
42,442
|
2,136
|
44,578
|
|||||||||||
|
Issue
of share capital by subsidiary
|
22,442
|
22,442
|
22,442
|
||||||||||||||||
|
less
outside equity interest
|
(4,917
|
)
|
(4,917
|
)
|
4,917
|
-
|
|||||||||||||
|
Options
exercised (2)
|
513
|
513
|
513
|
||||||||||||||||
|
Loss
for the period
|
(10,557
|
)
|
(10,557
|
)
|
(3,058
|
)
|
(13,615
|
)
|
|||||||||||
|
Share
of opening equity transferred to OEI due to issuance of further
shares by
subsidiary
|
(4,524
|
)
|
3,132
|
303
|
(1,089
|
)
|
1,089
|
-
|
|||||||||||
|
Exchange
differences on translation of foreign operations
|
(1,298
|
)
|
(1,298
|
)
|
(351
|
)
|
(1,649
|
)
|
|||||||||||
|
Share-based
payments
|
1,938
|
1,938
|
478
|
2,416
|
|||||||||||||||
|
At
31 December 2006
|
190,503
|
(137,187
|
)
|
(3,842
|
)
|
49,474
|
5,211
|
54,685
|
|||||||||||
|
(1)
- during the period 201,982 Novogen Limited shares were issued
following
the exercise of options.
|
|
(2)
- during the period 300,207 Novogen Limited shares were issued
following
the exercise of options.
|
The
above condensed statement of changes in equity should be read in conjunction
with the accompanying notes.
9
Novogen
Limited
Condensed
Cash Flow Statement
For
the half-year ended 31 December 2006
|
Consolidated
|
|||||||
|
2006
|
|
2005
|
|
||||
|
|
|
$'000
|
|
$'000
|
|||
|
Cash
flows from operating activities
|
|||||||
|
Receipts
from customers
|
7,312
|
6,679
|
|||||
|
Payments
to suppliers and employees
|
(18,282
|
)
|
(14,658
|
)
|
|||
|
Interest
received
|
961
|
799
|
|||||
|
Interest
paid
|
-
|
(13
|
)
|
||||
|
Grants
received/(repaid)
|
107
|
(33
|
)
|
||||
|
Royalty
received
|
458
|
944
|
|||||
|
Licence
fees received
|
1,122
|
-
|
|||||
|
Goods
and services tax (paid)/refunded by tax authorities
|
544
|
(34
|
)
|
||||
|
Net
cash flows used in operating activities
|
(7,778
|
)
|
(6,316
|
)
|
|||
|
Cash
flows from investing activities
|
|||||||
|
Acquisition
of property, plant and equipment
|
(234
|
)
|
(178
|
)
|
|||
|
Proceeds
from sale of plant and equipment
|
-
|
10
|
|||||
|
Net
cash flows used in investing activities
|
(234
|
)
|
(168
|
)
|
|||
|
Cash
flows from financing activities
|
|||||||
|
Proceeds
from the issue of ordinary shares
|
513
|
672
|
|||||
|
Proceeds
from the issue of shares by subsidiary
|
22,453
|
-
|
|||||
|
Repayment
of borrowings
|
(15
|
)
|
(303
|
)
|
|||
|
Net
cash flows from financing activities
|
22,951
|
369
|
|||||
|
Net
increase/(decrease) in cash and cash equivalents
|
14,939
|
(6,115
|
)
|
||||
|
Cash
and cash equivalents at beginning of period
|
33,513
|
47,260
|
|||||
|
Effect
of exchange rate changes on cash holdings in foreign
currencies
|
(2,137
|
)
|
1,251
|
||||
|
Cash
and cash equivalents at end of period
|
46,315
|
42,396
|
|||||
The
above condensed cash flow statement should be read in conjunction with the
accompanying notes.
10
Novogen
Limited
Notes
to the Half-Year Financial Statements
31
December 2006
Note
1. Basis of preparation of the half-year financial report
The
half-year consolidated financial statements are a general purpose financial
report prepared in accordance with the requirements of the Corporations Act
2001, Australian Accounting Standard AASB 134: Interim Financial Reporting,
Urgent Issues Group Interpretations and other authoritative pronouncements
of
the Australian Accounting Standards Board.
It
is
recommended that this financial report be read in conjunction with the annual
financial report for the year ended 30 June, 2006 and any public announcements
made by Novogen Limited and its controlled entities during the half-year
in
accordance with the continuous disclosure requirements arising under the
Corporations Act 2001. The half-year financial report does not include full
disclosures of the type normally included within the annual financial report.
Reporting
Basis and Conventions
The
accounting policies and methods of computation followed in this interim
financial report are consistent with those applied in the annual report for
the
year ended 30 June, 2006.
This
half-year financial report has been prepared on an accruals basis and is
based
on historical costs modified by the revaluation of selected non-current assets,
financial assets and financial liabilities for which the fair value basis
of
accounting has been applied.
Note
2. Revenue and expenses
|
Consolidated
|
|||||||
|
2006
|
|
2005
|
|
||||
|
|
|
$'000
|
|
$'000
|
|
||
|
Revenue
|
|||||||
|
Revenue
from the sale of goods
|
6,187
|
6,425
|
|||||
|
Bank
Interest
|
967
|
762
|
|||||
|
Royalties
|
1,176
|
1,033
|
|||||
|
Licence
fees
|
1,122
|
-
|
|||||
|
Other
revenue
|
1,036
|
450
|
|||||
|
4,301
|
2,245
|
||||||
|
Total
revenue
|
10,488
|
8,670
|
|||||
|
Other
Income
|
|||||||
|
Government
grants - research and development
|
1,347
|
(33
|
)
|
||||
11
Novogen
Limited
Notes
to the Half-Year Financial Statements
31
December 2006
|
Consolidated
|
|||||||
|
2006
|
|
2005
|
|
||||
|
|
|
$'000
|
|
$'000
|
|
||
|
Expenses
|
|||||||
|
Cost
of goods sold
|
(4,079
|
)
|
(2,311
|
)
|
|||
|
Shipping
and handling expenses
|
(253
|
)
|
(245
|
)
|
|||
|
Selling
and promotion expenses
|
(5,122
|
)
|
(4,586
|
)
|
|||
|
Research
& development expenses
|
(7,873
|
)
|
(4,908
|
)
|
|||
|
Administration
expenses
|
|||||||
|
Administration
- Net currency (losses)
|
(490
|
)
|
(2
|
)
|
|||
|
Administration
- other expenses *
|
(7,632
|
)
|
(3,423
|
)
|
|||
|
Other
expenses
|
-
|
(415
|
)
|
||||
|
(25,449
|
)
|
(15,890
|
)
|
||||
|
Borrowing
costs
|
-
|
(13
|
)
|
||||
|
Expenses
included in the numbers above, specifically
disclosed:
|
|||||||
|
Depreciation
of non-current assets
|
|||||||
|
Plant
and equipment
|
(391
|
)
|
(407
|
)
|
|||
|
Buildings
|
(145
|
)
|
(145
|
)
|
|||
|
Leasehold
improvements
|
(11
|
)
|
(2
|
)
|
|||
|
|
|||||||
|
Amortisation
of non-current assets
|
|||||||
|
Plant
and equipment under lease
|
-
|
(135
|
)
|
||||
|
Total
depreciation and amortisation expenses
|
(547
|
)
|
(689
|
)
|
|||
|
Expense
of share-based payments
|
2,381
|
233
|
|||||
*
includes $1,365,000 employee termination payment.
Note
3. Contingent assets and liabilities
On
11
July, 2006 MEI entered into a registration rights agreement which provides
for
liquidated damages of up to 10% of the aggregate purchase price of the
shares
issued as part of the PIPE transaction if MEI does not maintain an effective
registration of those shares.
On
11
August, 2006 Camellia Properties Pty Limited initiated proceedings against
the
Company, claiming damages of $5,161,487 in connection with terminated
negotiations of a commercial property lease. The Directors are of the view
that the basis of the claim is without foundation and the Directors are
obtaining legal advice with the intention of vigorously defending the
claim.
Since
the
last annual reporting date, there has been no other material changes
in any
contingent assets or contingent liabilities
12
Novogen
Limited
Notes
to the Half-Year Financial Statements
31
December 2006
Note
4. Segment information
Segment
Accounting Policies
The
Group
generally accounts for inter-company sales and transfers as if the sales
or
transfers were to third parties at current market prices. Revenues are
attributed to geographic areas based on the location of the assets producing
the
revenues.
Primary
Segment
|
Geographical
Segments
|
Australia/NZ
|
North
America
|
Europe
|
Elimination
|
Consolidated
(continuing operations)
|
||||||||||||||||||||||||||
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
||||||||||||
|
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
$'000
|
|
||||||||||
|
Revenue
|
|||||||||||||||||||||||||||||||
|
Sales
to customers outside the consolidated entity
|
2,057
|
2,421
|
2,541
|
2,588
|
1,589
|
1,416
|
-
|
-
|
6,187
|
6,425
|
|||||||||||||||||||||
|
Other
revenues from customers outside the consolidated entity
|
3,311
|
1,632
|
23
|
-
|
-
|
-
|
-
|
(149
|
)
|
3,334
|
1,483
|
||||||||||||||||||||
|
Intersegment
Revenues
|
1,895
|
989
|
-
|
-
|
-
|
-
|
(1,895
|
)
|
(989
|
)
|
-
|
-
|
|||||||||||||||||||
|
Total
segment revenue
|
7,263
|
5,042
|
2,564
|
2,588
|
1,589
|
1,416
|
(1,895
|
)
|
(1,138
|
)
|
9,521
|
7,908
|
|||||||||||||||||||
|
Unallocated
revenue
|
967
|
762
|
|||||||||||||||||||||||||||||
|
Total
Consolidated Revenue
|
10,488
|
8,670
|
|||||||||||||||||||||||||||||
|
Results
|
|||||||||||||||||||||||||||||||
|
Segment
result
|
(8,567
|
)
|
(8,162
|
)
|
(2,266
|
)
|
(4,117
|
)
|
(256
|
)
|
(277
|
)
|
(2,525
|
)
|
5,302
|
(13,614
|
)
|
(7,253
|
)
|
||||||||||||
|
Unallocated
expenses
|
-
|
(13
|
)
|
||||||||||||||||||||||||||||
|
Consolidated
entity loss before income tax
|
(13,614
|
)
|
(7,266
|
)
|
|||||||||||||||||||||||||||
|
Income
tax expense
|
(1
|
)
|
-
|
||||||||||||||||||||||||||||
|
Net
loss
|
(13,615
|
)
|
(7,266
|
)
|
|||||||||||||||||||||||||||
Note
5. Net tangible assets per share
|
Consolidated
|
|||||||
|
2006
|
2005
|
||||||
|
Net
tangible asset backing per share
|
|
$0.56
|
|
$0.57
|
|||
13
Novogen
Limited
Notes
to the Half-Year Financial Statements
31
December 2006
Note
6. Events after balance sheet date
Novogen
Limited announced on 27 February, 2007, that its US subsidiary company
Glycotex,
Inc., had received the first tranche of a private share placement of
88,136 shares of its common stock. Proceeds from this the raising amounted
to US$1.575 million. Following the placement Novogen retains 81.3%
interest in Glycotex, Inc.
14
Novogen
Limited
Directors’
Declaration
31
December 2006
Financial
report for the half-year ended 31 December 2006
The
Directors declare that the financial statements and notes as set out on pages
7
to 14:
(a)
comply with Accounting Standards, the Corporations Regulations 2001;
and
(b)
give
a true and fair view of the consolidated entity's financial position as at
31
December 2006 and of its performance, as represented by the results of its
operations and cash flows, for the half-year ended on that date.
In
the
Directors' opinion:
(a)
the
financial statements and notes are in accordance with the Corporations Act 2001;
and
(b)
there
are reasonable grounds to believe that Company Limited will be able to pay
its
debts as and when they become due and payable.
This
declaration is made in accordance with a resolution of Directors.
On
behalf
of the board
/s/
C
Naughton
C
Naughton
Managing
Director
Sydney,
27 February, 2007
15
Novogen
Limited
Independent
Review Report
31
December 2006
| |
Chartered
Accountants
&
Advisers
|
Level
19, 2 Market Street Sydney NSW 2000
GPO
Box 2551 Sydney NSW 2001
Tel.
+61 2 9286 5555 Fax +61 2 9286 5599
Email:
bdosyd@bdosyd.com.au
www.bdo.com.au
|
INDEPENDENT
REVIEW REPORT
TO
THE MEMBERS OF NOVOGEN LIMITED
Report
on the Half-Year Financial Report
We
have
reviewed the accompanying half-year financial report of Novogen Limited,
which
comprises the condensed balance sheet as at 31 December 2006, and the condensed
income statement, condensed statement of changes in equity and condensed
cash
flow statement for the half-year ended on that date, a statement of accounting
policies, other selected explanatory notes and the directors’
declaration of
the
consolidated entity comprising the disclosing entity and the entities it
controlled at the half-year end or from time to time during the half-year
in
order for the disclosing entity to lodge the half-year financial report with
the
Australian Securities and Investments Commission.
Directors’
Responsibility for the Half-Year Financial Report
The
directors of the disclosing entity are responsible for the preparation and
fair
presentation of the half-year financial report in accordance with Australian
Accounting Standards (including the Australian Accounting Interpretations)
and
the Corporations
Act 2001.
This
responsibility includes designing, implementing and maintaining internal
control
relevant to the preparation and fair presentation of the half-year financial
report that is free from material misstatement, whether due to fraud or error;
selecting and applying appropriate accounting policies; and making accounting
estimates that are reasonable in the circumstances.
Auditor’s
Responsibility
Our
responsibility is to express a conclusion on the half-year financial report
based on our review. We conducted our review in accordance with Auditing
Standard on Review Engagements ASRE 2410 Review
of an Interim Financial Report Performed by the Independent Auditor of the
Entity,
in
order to state whether, on the basis of the procedures described, we have
become
aware of any matter that makes us believe that the financial report is not
in
accordance with the Corporations
Act 2001
including: giving a true and fair view of the disclosing entity’s financial
position as at 31 December 2006 and its performance for the half-year ended
on
that date; and complying with Accounting Standard AASB 134 Interim
Financial Reporting
and the
Corporations
Regulations 2001.
As the
auditor of Novogen Limited, ASRE 2410 requires that we comply with the ethical
requirements relevant to the audit of the annual financial report.
16
Novogen
Limited
Independent
Review Report
31
December 2006
| |
Chartered
Accountants
&
Advisers
|
Level
19, 2 Market Street Sydney NSW 2000
GPO
Box 2551 Sydney NSW 2001
Tel.
+61 2 9286 5555 Fax +61 2 9286 5599
Email:
bdosyd@bdosyd.com.au
www.bdo.com.au
|
A
review
of a half-year financial report consists of making enquiries, primarily of
persons responsible for financial and accounting matters, and applying
analytical and other review procedures. A review is substantially less in
scope
than an audit conducted in accordance with Australian Auditing Standards
and
consequently does not enable us to obtain assurance that we would become
aware
of all significant matters that might be identified in an audit. Accordingly,
we
do not express an audit opinion.
Independence
In
conducting our review, we have complied with the independence requirements
of
the Corporations
Act 2001.
We
confirm that the independence declaration required by the Corporations
Act 2001,
provided to the directors of Novogen Limited on 27 February 2007, would be
in
the same terms if provided to the directors as at the date of this auditor’s
review report.
Conclusion
Based
on
our review, which is not an audit, we have not become aware of any matter
that
makes us believe that the half-year financial report of Novogen Limited is
not
in accordance with the Corporations
Act 2001
including:
|
(a)
giving
a true and fair view of the consolidated entity’s financial position as at
31 December 2006 and of its performance for the half-year ended on
that
date; and
|
|
(b)
complying
with Accounting Standard AASB 134 Interim
Financial Reporting
and Corporations Regulations 2001.
|
/s/
BDO
BDO
Chartered
Accountants
/s/
Wayne
Basford
Wayne
Basford
Partner
Dated
Sydney, this 27th
day of
February 2007
17