Announcement PDF ENERGY TECHNOLOGIES LIMITED (ASX: EGY) ABN 38 002 679 469 Half-Year Financial Report for the half-year ended 31 December 2015 Corporate Information ABN 38 002 679 469 Directors Alfred J. Chown (Acting Chairman, Managing Director) Gary A. Ferguson (Non-Executive Director) Philip W. Dulhunty (Non-Executive Director) Yulin Hu (Non-Executive Director) Company Secretary Gregory R. Knoke Registered Office 102 Old Pittwater Road BROOKVALE NSW 2100 Bankers National Australia Bank Limited NAB House, 255 George Street Sydney NSW 2000 Share Register Computershare Investor Services Pty Ltd Level 4, 60 Carrington Street Sydney NSW 2000 Telephone:- 1300 855 080 or +61 (0)3 9415 4000 Facsimile:- +61 (0)2 8234 5050 Auditors Russell Bedford NSW Chartered Accountants Level 29, Suncorp Place 259 George Street SYDNEY NSW 2000 Telephone: - +61 (0)2 9032 3000 2 Energy Technologies Limited – Half-year Report Contents Directors’ Report................................................................................................................................................. 4 Lead Auditor’s Independence Declaration.......................................................................................................... 6 Condensed Consolidated Statement of Profit or Loss ....................................................................................... 7 Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income ............................... 8 Condensed Consolidated Statement of Financial Position ................................................................................ 9 Condensed Consolidated Statement of Changes in Equity ............................................................................. 10 Condensed Consolidated Statement of Cash Flows........................................................................................ 11 Notes to the Half –Year Financial Statements.................................................................................................. 12 Directors’ Declaration ....................................................................................................................................... 18 Independent Review Report ............................................................................................................................. 19 3 Energy Technologies Limited – Half-year Report Directors’ Report Your Directors submit their report for the half-year ended 31 December 2015 DIRECTORS The names and details of the Company's Directors in office during the half-year and until the date of this report are as follows. Directors were in office for this entire period unless otherwise stated. Alfred J. Chown (Chairman, Managing Director) Appointed 4 July 1997. Gary A. Ferguson (Non-Executive Director) Appointed on 1 October 2012. Philip W. Dulhunty (Non-Executive Director) Appointed 3 December 2014. Yulin Hu (Non-Executive Director) Appointed 25 November 2015. Meiping Hu (Alternate Director to Yulin Hu) Appointed 25 November 2015. PRINCIPAL ACTIVITIES AND SIGNIFICANT CHANGES IN NATURE OF ACTIVITIES The principal activities during the half-year of entities within the economic entity were:  the manufacture and sale of specialist industrial cables  development of energy generation technology REVIEW AND RESULTS OF OPERATIONS The half year to 31 December 2015 continued to be very challenging for the group, with poor results reflecting the market downturn. EGY reported a consolidated loss after tax and minorities of $1,379,079 in comparison with the half year to 31 December 2014 result of a consolidated loss of $27,156. Overall revenue from operating activity at $4,907,800 was 8.5% down on the previous reporting period. EGY’s wholly owned subsidiary Bambach Wires and Cables Pty Ltd (BWC) reported a loss after tax of $1,093,353 compared to the reported loss for the six months to 31 December 2014 of $597,365. BWC continues to focus on the development of new markets and new and improved branded products with an amount of $360,000 accrued this financial year to date for FY2016 R&D, and a series of new cable products to be launched over the next six months. The parent entity has reported a loss after tax of $284,870 (December 2014 half year profit after tax of $592,418). During the period EGY raised $394,793 through equity issues as approved at the AGM held on 19 November 2015. In addition EGY issued 1,770 convertible notes, as approved by shareholders at the AGM held on 19 November 2015, with a face value of $1,000. Funds raised have been applied for specific factory capital expenditure and to meet working capital requirements. Subsequent to balance date 500 convertible notes were converted to equity, refer Note10. The bulk of the losses for the half year occurred in the second quarter-October/November/December which saw sales slow dramatically at a time when sales are normally strong. The slowdown was unexpected and a combination of the continued decline in mining and a dearth of infrastructure projects. At the time of writing the company has experienced a significant upswing in order intake over January/February and in general is experiencing much more robust market conditions as infrastructure projects finally start to come on stream. Whilst day to day sales remain sluggish, bidding for project work has escalated and more importantly projects are now finally being awarded initially to the major contractors and then by the contractors to their suppliers and subcontractors of which Bambach is one. Funds raised by the company in November aided the company in handling the first half loss and the focus is now on building the business and sales to reverse the loss in the second half. Signs thus far have been encouraging with an uptick in orders for cables associated with both rail and road builds. Going forward the company is positioning itself for defence related contracts and other OEM contracts with major manufacturers. A regime of product development and testing is underway which will see new products ready for sale in 2016 with expected demand to occur in 2017 and picking up through the 2018-2022 period. Simultaneously the company is upgrading its production capabilities which will generate a 12-15% gross margin improvement over the medium term. 4 Energy Technologies Limited – Half-year Report Directors’ Report (Cont’d) The company has strategically positioned itself to supply to both civil and defence infrastructure projects in the belief that Australia must undertake significant infrastructure development to maintain its standard of living. These projects are now starting to occur with Sydney currently leading the way, but other states also have a large amount of projects to be undertaken. The growth of the company will follow the level of Australia-wide infrastructure and defence spend, aided by a low Australian dollar. With success at home, and a benign exchange rate, the company will then be well positioned to export quality and proven product for overseas projects. In light of their firm belief in the company strategy the Directors intend to raise further funds through an equity issue before end of FY2016. AUDITOR’S INDEPENDENCE DECLARATION The lead auditor’s independence declaration under Section 307C of the Corporations Act 2001 is set out on page 06 and forms part of the Directors’ Report for the half-year ended 31 December 2015. Signed in accordance with a resolution of the Directors. Alfred J Chown Managing Director Sydney, 29 February 2016 5 29 February 2016 The Board of Directors Energy Technologies Limited 102 Old Pittwater Road Brookvale NSW 2100 Dear Members of the Board Lead Auditor’s Independence Declaration Under Section 307C of the Corporations Act 2001 As the lead audit partner for the review of the financial statements of Energy Technologies Limited for the half year ended 31 December 2015, I declare that, 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 this review; and any applicable code of professional conduct in relation to the review. Yours sincerely RUSSELL BEDFORD NSW GREGORY RALPH M.Com., F.C.A. Partner 6 Energy Technologies Limited – Half-year Report Condensed Consolidated Statement of Profit or Loss for the half-year ended 31 December 2015 CONSOLIDATED 31 December 31 December 2015 2014 $ $ Continuing Operations Sales revenue 3(i) 4,907,800 5,360,488 Other revenues 3(i) 400,718 1,233,586 Total revenue from continuing operations 5,308,518 6,594,074 Cost of sales (4,062,739) (4,225,839) Marketing expenses (27,175) (27,558) Occupancy expenses (225,083) (269,359) Administration expenses (1,828,019) (1,749,526) Depreciation and amortisation expenses (118,350) (52,483) Other expenses (67,837) (71,115) (1,020,685) 198,194 (354,546) (250,879) (1,375,231) (52,685) (4,704) 3,320 (1,379,935) (49,365) (1,379,079) (27,156) (856) (22,209) (1,379,935) (49,365) (0.57) (0.57) (0.01) (0.01) PROFIT/(LOSS) BEFORE FINANCE COSTS, INCOME TAX 3(ii) Finance costs (LOSS) BEFORE INCOME TAX INCOME TAX BENEFIT/(EXPENSE) (LOSS ) FOR THE PERIOD (LOSS) ATTRIBUTABLE TO: Owners of the parent Non-controlling interest Earnings per Share From continuing operations:   Basic loss per ordinary share (cents) Diluted loss per ordinary share (cents) The condensed consolidated statement of profit or loss should be read in conjunction with the accompanying notes. 7 Energy Technologies Limited – Half-year Report Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income for the half-year ended 31 December 2015 CONSOLIDATED 31 December 2015 (LOSS) FOR THE PERIOD 31 December 2014 (1,379,935) (49,365) (2,602) (1,275) (2,602) (1,275) (5,204) (1,385,139) (2,550) (51,915) (1,381,681) (28,431) (3,458) (23,484) (1,385,139) (51,915) OTHER COMPREHENSIVE INCOME Items that may be reclassified subsequently to profit or loss Movement in foreign exchange relating to translation of controlled foreign entities Exchange differences on foreign exchange relating to minorities TOTAL COMPREHENSIVE (LOSS) TOTAL COMPREHENSIVE (LOSS) ATTRIBUTABLE TO: Owners of the parent Non-controlling interest The condensed consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes. 8 Energy Technologies Limited – Half-year Report Condensed Consolidated Statement of Financial Position as at 31 December 2015 CONSOLIDATED 31 December 2015 $ ASSETS CURRENT ASSETS 30 June 2015 $ 43,912 2,345,587 3,606,191 283,726 6,279,416 99,317 2,891,736 3,502,978 361,127 6,855,158 2,151,491 283,513 219,180 - 2,024,265 290,236 223,884 - TOTAL NON-CURRENT ASSETS 2,654,184 2,538,385 TOTAL ASSETS 8,933,600 9,393,543 2,832,579 1,693,326 587,217 5,113,122 3,293,632 2,488,449 564,643 6,346,724 4,616,382 77,322 2,904,307 35,392 TOTAL NON-CURRENT LIABILITIES 4,693,704 2,939,699 TOTAL LIABILITIES 9,806,826 9,286,423 NET ASSETS (873,226) 107,120 8,779,071 (1,052,378) (8,022,531) (295,838) (577,388) (873,226) 8,374,278 (1,049,776) (6,643,452) 681,050 (573,930) 107,120 Cash and cash equivalents Trade and other receivables Inventories Other current assets TOTAL CURRENT ASSETS NON CURRENT ASSETS 4 Plant & equipment Intangible assets Deferred tax asset Investments accounted for using the equity method 5 CURRENT LIABILITIES Trade and other payables Financial liabilities Provisions TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES 6 Financial liabilities Provisions EQUITY Issued capital Reserves Accumulated losses Equity attributable to owners of the parent Non-controlling interest 7 TOTAL EQUITY The condensed consolidated statement of financial position should be read in conjunction with the accompanying notes. 9 Energy Technologies Limited – Half-year Report Condensed Consolidated Statement of Changes in Equity for the half-year ended 31 December 2015 Reserves $ Accumulated Losses $ NonControlling Interest $ Total $ 8,374,278 (1,045,254) (6,213,492) (523,830) 591,702 - - (27,156) (22,209) (49,365) - (1,275) (1,275) (27,156) (1,275) (23,484) (2,550) (51,915) Balance at 31.12.2014 8,374,278 (1,046,529) (6,240,648) (547,314) 539,787 Balance at 1.7.2015 8,374,278 (1,049,776) (6,643,452) (573,930) 107,120 - - (1,379,079) (856) (1,379,935) - (2,602) (2,602) (1,379,079) (2,602) (3,458) (5,204) (1,385,139) 404,793 8,779,071 (1,052,378) (8,022,531) (577,388) 404,793 (873,226) Balance at 1.7.2014 Issued Capital $ Comprehensive income Loss for the period Other comprehensive ( loss) for the period, net of income tax Total comprehensive (loss) for the period Transactions with owners, in their capacity as owners, and other transfers Contributions of Equity Comprehensive income Loss for the period Other comprehensive (loss) for the period, net of income tax Total comprehensive (loss) for the period Transactions with owners, in their capacity as owners, and other transfers Contributions of Equity Balance at 31.12.2015 The condensed consolidated statement of changes in equity should be read in conjunction with the accompanying notes. 10 Energy Technologies Limited - Half-Year Report Condensed Consolidated Statement of Cash Flows for the half-year ended 31 December 2015 CONSOLIDATED 31 December 2015 31 December 2014 $ $ CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Borrowing costs NET CASH FLOWS (USED IN) OPERATING ACTIVITIES 5,922,957 (6,648,370) (308,309) (1,033,722) 6,528,811 (6,626,712) (250,879) (348,780) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant and equipment Proceeds from sale of property, plant and equipment Proceeds from sale of financial assets NET CASH FLOWS (USED IN) INVESTING ACTIVITIES (238,853) 273 (238,580) (17,869) 23,409 5,716 11,256 Proceeds of issue of shares 404,793 - Proceeds of issue of convertible notes 500,000 2,100,000 Proceeds from borrowings Repayment of borrowings 456,422 (144,877) (254,302) NET CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES 1,216,338 1,845,698 NET INCREASE/(DECREASE) IN CASH HELD (55,964) 1,508,174 Cash at beginning of the financial period 99,317 65,609 Effects of exchange rate fluctuations on the balances of cash held in foreign currencies 559 3,739 CLOSING CASH BALANCE AT END OF FINANCIAL PERIOD 43,912 1,577,522 CASH FLOWS FROM FINANCING ACTIVITIES The condensed consolidated statement of cash flows should be read in conjunction with the accompanying notes. 11 Energy Technologies Limited – Half-year Report Notes to the Half –Year Financial Statements 31 December 2015 1. BASIS OF PREPARATION OF THE HALF-YEAR FINANCIAL REPORT (a) Basis of Preparation These general purpose financial statements for the interim half-year reporting period ended 31 December 2015 have been prepared in accordance with requirements of the Corporations Act 2001 and Australian Accounting Standard AASB 134 “Interim Financial Reporting”. The group is a for-profit entity for financial reporting purposes under Australian Accounting Standards. The half-year financial report is intended to provide users with an update on the latest annual financial statements of Energy Technologies Limited and its controlled entities (the Group). As such, it does not contain information that represents relatively insignificant changes occurring during the half-year within the Group. It is therefore recommended that this financial report be read in conjunction with the Annual Financial Report of Energy Technologies Limited as at 30 June 2015 together with any public announcements made during the half-year. The same accounting policies and methods of computation have been followed in this interim financial report as were applied in the most recent annual financial statements, except in relation to some of the matters discussed at Note 1(b) below. (b) Going Concern The consolidated entity incurred a loss after tax and non-controlling interest of $1,379,079 (2014:$27,156) and incurred negative cash flows from operations of $1,181,409 (2014:$348,780) for the half year ended 31 December 2015. Furthermore, there was a 8.5% reduction in sales revenue from the comparative half year. At 31 December 2015 the consolidated entity had a net deficiency of $873,226 including the recognition of deferred tax assets of $219,180 and intangible assets of $283,513. At balance date, current assets exceeded current liabilities by $1,166,294. Subsequent to the 31 December 2015, $500,000 of outstanding notes have been converted to equity, which further improves the financial position. These matters give rise to a material uncertainty that may cast significant doubt upon the consolidated entity’s ability to continue as a going concern. The ongoing operation of the consolidated entity is dependent upon it: (a) achieving cash flow positive trading operations from its existing business; (b) continued financial support from its current financiers and directors; and (c) raising further equity or long term funding over the ensuing 12 months. Management consider sales revenues were negatively impacted by the continued decline in mining investment and a dearth of infrastructure projects. To combat the impact of the mining downturn the company has embarked on increasing its non-mining range of cable products and to this end has brought two new product lines to market and has further lines undergoing development and testing to be ready for sale in 2016. It is expected that these new offerings will reverse the decline experienced in sales and generate a significant improvement in overall revenues. Management have prepared a cash flow projection for the period to 31 March 2017 that supports the ability of the consolidated entity to continue as a going concern. The calendar 2016 budget on which the cash flow projection is based forecasts a 36% increase in sales revenues for calendar 2016 from the annualised HY2015 actual sales, and. The cash flow projection includes a 36% increase in sales over the annualised HY2015 result and assumes new equity investment of $1,000,000. A temporary revolving loan facility of $750,000 has been provided by the directors ($300,000 of which was contributed during the period). The facility will be repaid as funds permit. The projection forecasts the facility to be fully repaid from operating cash surpluses generated in the second half of calendar 2016. 12 Energy Technologies Limited – Half-year Report Notes to the Half –Year Financial Statements 31 December 2015 1. BASIS OF PREPARATION OF THE HALF-YEAR FINANCIAL REPORT (Cont’d) (b) Going Concern (Continued) The sales to date for the current half year fell short of budget by 21% however, based on unfilled February orders and job quotes submitted the Directors expect this to be timing difference only which will be made good in subsequent months. The Directors are still confident of achieving the calendar 2016 sales budget including expected sales from tendering to existing major suppliers and contractors, and winning major project works in NSW and later Western Australia and Victoria with respect to announced infrastructure projects. Apart from the introduction of new products into both existing and new market segments, the company has embarked on an upgrade of its manufacturing capabilities. The Business Plan of the company calls for the installation of new equipment that will cut existing manufacturing costs by between 10-15% and simultaneously expand the size of cables able to be manufactured. The company has installed some of this equipment in December 2015/January 2016. The expected margin improvement of 3% from this first round of is reflected in the forecast from February 2016. The company intends to obtain investment funds for the next stage of equipment purchases in coming months. Directors are in discussion with potential investors and their advisors and pursuant to those advices are confident of raising the necessary investment funds. As a consequence of these matters, the Directors believe the consolidated entity will continue as a going concern and it is appropriate to prepare these financial statements on that basis. In the event that the consolidated entity is unable to achieve the matters detailed above, it may not be able to continue as a going concern and therefore the consolidated entity may not be able to realise its assets and extinguish its liabilities in the ordinary course of operations and at the amounts stated in the financial statements. No adjustments have been made to the recoverability and classification of recorded asset values and the amount and classification of liabilities that might be necessary should the consolidated entity and company not continue as going concerns. (c) New and Revised Accounting Requirements Applicable to the Current Half-Year Reporting Period The Group adopted the following Australian Accounting Standard from the mandatory application date of 1 January 2015: AASB 2014-1: Amendments to Australian Accounting Standards (Part E) Part E of this Standard is applicable to annual reporting periods beginning on or after 1 January 2015 and defers the application date of AASB 9 (December 2010) to annual reporting periods beginning on or after 1 January 2018. This part also makes consequential amendments to hedge accounting disclosures set out in AASB 7: Financial Instruments: Disclosures, and to AASB 132: Financial Instruments: Presentation to permit irrevocable designation of "own use contracts" as measured at fair value through profit or loss if the designation eliminates or significantly reduces an accounting mismatch. Management believes that there will not be any significant impact on the Group's financial statements on adoption of this part of the Standard. 13 Energy Technologies Limited – Half-year Report Notes to the Half –Year Financial Statements 31 December 2015 2. SEGMENT INFORMATION Primary reporting - Business segments Cables/Energy Infrastructure Investment Total 31/12/2015 31/12/2014 31/12/2015 31/12/2014 31/12/2015 31/12/2014 $ $ $ $ $ $ Revenue 5,308,518 5,753,951 - 840,123 5,308,518 6,594,074 Segment result before income tax (964,361) (519,103) (410,870) 466,418 (1,375,231) (52,685) 4,704 (3,320) - - 4,704 (3,320) Profit after income tax (969,065) (515,783) (410,870) 466,418 (1,379,935) (49,365) Segment Assets 8,603,032 8,217,896 330,568 1,812,114 8,933,600 10,030,010 Segment Liabilities 8,542,158 6,546,310 1,264,668 2,943,913 9,806,826 9,490,223 Income tax expense(credit) The group’s primary business segment is specialist and industrial cables and energy generation technology. 3. REVENUE, INCOME AND EXPENSES (i) Revenue from continuing operations Sale of goods Other Revenues: Federal R&D Grant Foreign exchange gains Finance revenue Discount on acquisition of subsidiary Other income Total Other Revenues (ii) Finance costs Loans and convertible notes Borrowing costs 14 31 December 2015 $ 4,907,800 31 December 2014 $ 5,360,488 360,000 30 40,688 400,718 5,308,518 360,000 14,203 735 839,039 19,609 1,233,586 6,594,074 324,546 30,000 354,546 150,879 100,000 250,879 Energy Technologies Limited – Half-year Report Notes to the Half –Year Financial Statements 31 December 2015 4. PLANT AND EQUIPMENT Acquisitions and disposals During the half-year ended 31 December 2015 the group acquired fixed assets at a cost of $238,853 (2014 $17,869). Plant and equipment disposals during the half year ended 31 December 2015 provided net proceeds of $273 (2014: $23,409). 5. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD Consolidated 31 December 2015 $ Associated Company 30 June 2015 $ - - - - An Interest is held in the following associated company Name Principal Activity Country of Incorporation Ownership Interest Shares Unlisted: Dulhunty Poles Pty Limited Manufacture & Sale of Glass Fibre Reinforced Cement Composite Power Poles Australia % % Dec 2015 Jun 2015 36 36 Ordinary Carrying Amount of Investment $ - 6. INTEREST-BEARING LOANS AND BORROWINGS (Non-Current) Convertible Notes 2,800 notes of $1,000 each convertible on or before 31/10/2016 3,200 notes of $1,000 each convertible on or before 31/12/2018 1,270 notes of $1,000 each convertible on or before 31/12/2020 Non-Current Convertible Notes at 31 December 2015 Hire purchase liabilities Amount due greater than 12 months 15 31 December 2015 30 June 2015 $ $ 3,200,000 1,270,000 4,470,000 2,800,000 2,800,000 146,382 4,616,382 104,307 2,904,307 Energy Technologies Limited – Half-year Report Notes to the Half –Year Financial Statements 31 December 2015 6. INTEREST-BEARING LOANS AND BORROWINGS (Cont’d) During the half-year ended 31 December 2015 the group repaid $144,877 (2014: $254,302) of both long and short term interest bearing debt and raised $1,770,000 (2014: $2,100,000) of long term interest bearing debt. This raising consists of 1,770 convertible notes, each with a face value $1,000, as approved at the 2015 Annual General Meeting. The notes are interest bearing and interest is calculated on the face value of each note at a rate which is eight percentage points higher than the RBA cash rate (totalling 10% per annum at balance date) from time to time paid monthly in arrears, until the earlier of the Maturity Date or the conversion of the Convertible Note. Of the convertible notes issued 500 convertible notes have a maturity date of 31 December 2018 and these notes may be converted to ordinary shares at any time up to maturity date at a fixed price of $0.01, subject to the provisions of the note document. The further 1,270 convertible notes have a maturity date of 31 December 2020 and these notes may be converted to ordinary shares at any time up to maturity date at a fixed price of $0.015, subject to the provisions of the note document. (Refer also Note 10 - Subsequent Events). Of the 2,800 convertible notes on issue at 1 July 2015, 2,700 of these notes maturities have been extended to 31 December 2018 in agreement with the note holders. 7. CONTRIBUTED EQUITY 31 December 2015 30 June 2015 $ $ Ordinary shares (i) Ordinary shares Fully paid ordinary shares carry one vote per share and carry the right to dividends. 8,779,071 No. of shares Movement in ordinary shares on issue At 1 January 2015 At 30 June 2015 At 1 July 2015 Shares issued during the period - 16 October 2015 (at $0.01 per share) - 9 December 2015 (at $0.0125 per share) - 18 December 2015 (at $0.01 per share) 18 December 2015 (at $0.01 per share) Less: transaction costs on issue of shares At 31 December 2015 16 8,374,278 $ 224,528,463 224,528,463 8,374,278 8,374,278 224,528,463 8,374,278 33,679,269 800,000 12,500,000 5,000,000 276,507,732 336,793 10,000 125,000 50,000 (117,000) 8,779,071 Energy Technologies Limited – Half-year Report Notes to the Half –Year Financial Statements 31 December 2015 8. CONTINGENT LIABILITIES Contingent liabilities of the group are materially as disclosed in the 30 June 2015 Annual Report. 9. RELATED PARTIES During the half year ended 31 December 2015, the group purchased new fixed assets by way of Hire Purchase agreement with a director Mr Alfred Chown. The amount financed was $40,000 commencing November 2015 for a term of 48 months. The terms and conditions are no more favourable than those available, or which might reasonably be expected to be available, on similar transactions to unrelated entities on an arms-length basis. Loans by Directors and Key Management During the half year to 31 December 2015 a director, Mr Gary Ferguson, was issued with 300 convertible notes each with a face value of $1,000 (refer Note 6). Funding for the convertible notes included conversion of a previous unsecured loan to subsidiary Bambach Wires and Cables Pty Ltd of $240,000 (2014: $240,000). During the half year to 31 December 2015 a director, Mr Alfred Chown, was issued with 250 convertible notes each with a face value of $1,000 (refer Note 6). Funding for the convertible notes was in settlement of a finance facility previously provided through his related entity Bamtech Finance Pty Ltd. During the half year to 31 December 2015 Director Mr Alfred Chown loaned subsidiary Bambach Wires and Cables Pty Ltd $200,000 under a Revolving Loan Facility. An entity related to director Mr Yulin Hu loaned Bambach Wires and Cables Pty Ltd $100,000. This loan is unsecured and interest is payable at the rate of 10% per annum. A key management personnel has a loan of $20,000 (2014:$20,000) to subsidiary Bambach Wires and Cables Pty Ltd. This loan is unsecured and repayable on demand. Interest is payable at the rate of 12% percent per annum. 10. EVENTS SUBSEQUENT TO BALANCE DATE Subsequent to balance date an entity related to director Mr Yulin Hu converted 500 convertible notes with face value of $1,000 to equity at an issue price of $0.01, as approved at the Annual General Meeting of the company held on 19 November 2015. Other than as disclosed above, there has not arisen since the end of the financial period any matter or circumstance which, in the opinion of the directors of the Company, will significantly affect the operations of the Company, the results of those operations, or the state of affairs of the Company in subsequent financial years. 17 Energy Technologies Limited – Half-year Report Notes to the Half –Year Financial Statements 31 December 2015 Directors’ Declaration The directors of the company declare that: 1. The financial statements and notes, as set out on pages 7 to 17 are in accordance with the Corporations Act 2001, including: a) complying with Accounting Standard AASB 134: Interim F