Promisia Integrative Limited Annual Report 31 December 2019

Promisia Integrative Limited
Results for announcement to the market
Reporting Period12 months to December 2019
Previous Reporting Period12 months to December 2018
Amount (000s)Percentage change
Revenue from ordinary
activities
190 NZD-74.0%
Profit (loss) from ordinary
activities after tax attributable to
security holders
-2,401 NZD-0.5%
Net profit (loss) attributable to
security holders
-2,400 NZD-0.3%
No dividends declared
31 Dec 201831 Dec 2019
Net tangible assets per security
0.000 NZD-0.001 NZD
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Promisia Integrative Limited

Annual Report
31 December 2019

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THE COMPANY
Promisia Integrative Limited is a company focused on developing and marketing unique natural
therapeutic products with proven safety and efficacy based on robust research. Our goal is to add
scientific methodology and validity to a sector that is often perceived to be unscientific.

FINANCIAL SUMMARY
31 December
2019

$ 000
31 December
2018

$ 000
Change
%
Revenue 190 727 (74)
Total comprehensive income attributable to
shareholders
(2,400) (2,407) (1)
Total Assets 85 1,851 (95)
Earnings per share (0.001) (0.004) -
Net Tangible Asset Backing ($ per share) $- $0.001 -

SIGNIFICANT EVENTS
On 19 December 2019 the Company advised shareholders that it intended to cease its activities in the
natural health sector and enter the aged care sector. The Company has entered into a conditional
agreement to purchase three aged care facilities owned by its major shareholder, Brankin Family
Trust, and a lease on a currently vacant building in Aldwins Road Christchurch that will be operated
as an aged care facility.
The agreement is conditional upon shareholder approval and the completion of the necessary
regulatory requirements prior to all details of the transaction being sent to shareholders.

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TABLE OF CONTENTS

THE COMPANY .................................................................................................................................. 3
FINANCIAL SUMMARY .................................................................................................................... 3
SIGNIFICANT EVENTS ..................................................................................................................... 3
REPORT OF THE CHAIRMAN ........................................................................................................... 5
PEOPLE – BOARD OF DIRECTORS .................................................................................................. 7
GOVERNANCE ................................................................................................................................... 8
INDEPENDENT AUDITOR’S REPORT ............................................................................................ 11
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME ............................................... 13
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ......................................................... 14
CONSOLIDATED STATEMENT OF FINANCIAL POSITION ........................................................ 15
CONSOLIDATED STATEMENT OF CASH FLOWS ......................................................................... 16
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS .................................................... 17
SUBSEQUENT EVENTS .................................................................................................................. 33
SHAREHOLDER AND STATUTORY INFORMATION ................................................................... 34
CORPORATE AND OTHER INFORMATION ................................................................................. 39

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REPORT OF THE CHAIRMAN

On behalf of your directors I present the Annual Report of the directors for Promisia Integrative
Limited and its subsidiaries (“the group”) for the year ended 31 December 2019.
Group Results
The loss for the year of $2,391,000 was similar to the loss of $2,407,000 in the previous year. Two
major factors in the loss were:
• An impairment of $1,107,000 against all inventory,
• Legal and other fees of $294,000 associated with the proposed entry into the aged care
business.
Total sales for the year were $190,000 compared with $727,000 in the previous year. This was a
reduction of 74%.
Shareholders were advised earlier in the year that the company would not be expending any funds on
advertising due to the uncertainties around the Ministry of Health prosecution. An inevitable
outcome was that sales would suffer.
Medsafe Prosecution
In late January 2019 Medsafe commenced a prosecution of the company in the District Court alleging
9 breaches of the Medicines Act 1981.
Two of the charges relate to the alleged sale of an unlicensed medicine, being Arthrem. The company
has always maintained that Arthrem is a dietary supplement, not a medicine. The remaining charges
relate to the promotion of Arthrem on the company’s websites and are based on the assumption that
Arthrem is an unlicensed medicine. The company notes that all its marketing and advertising
material was submitted for review to the Therapeutic Goods Advertising Pre-Vetting Service (TAPS)
before being published and it received a TAPS Approval Number that is displayed on every item.
There have been three brief appearances in the District Court but little or no progress other than
additional disclosure by the Ministry. The delays in getting this matter into Court are of considerable
concern. The company has operated in an environment of uncertainty and it is the view of the Board
that this matter is rapidly becoming a case where ‘justice delayed is justice denied’.
New Zealand
Sales of Arthrem in New Zealand have been limited as the number of pharmacies selling the product
reduced following the second Medsafe Alert in late 2018. Medsafe made a recommendation to the
Medicines Classification Committee that Artemisia annua be classified as a prescription medicine.
The Committee has accepted this recommendation and it was likely that all sales of Arthrem in New
Zealand would cease in early March 2020. This decision has been subject to an unsuccessful judicial
review but that review decision is being appealed. If all appeals fail then a notice will be published in
the New Zealand Gazette and the company will cease to sell Arthrem.
Australia
Sales in Australia were very disappointing following the first Medsafe Alert in 2018. Distribution costs
in Australia were high and could not be justified. In August 2019 the company advised shareholders
that distribution arrangements in Australia had been terminated and Arthrem was no longer available
at the retail level. On withdrawal from the Australian market the company requested cessation of the
registration of Arthrem as a complementary medicine in Australia. The company worked with the
Therapeutic Goods Administration in Australia and agreed to a voluntary retail recall of Arthrem from
the few pharmacies holding stock.
The company notes that no adverse reactions to Arthrem have been reported in Australia.

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Artevite
The stock of Artevite had a limited shelf life which expired in August 2019 and in mid-2019 was
donated for use in promotional packages for pet shows. This action disposed of the product at very
limited cost to the company.
Funding
All operating costs have been reduced as far as possible during the year. Operational funding has been
provided by director Tom Brankin and his interests and, on behalf of the shareholders, the Directors
express their thanks to Mr Brankin for his support of the company.
During the year Brankin interests exercised an option to subscribe for an additional 250,000,000
shares at $0.001 per share. These shares were paid up progressively and issued as fully paid shares in
November 2019.
Entry into the Aged Care Business
In light of the action by Medsafe and the Ministry of Health, the Directors were of the view that there
was little, if any, future in the natural health products business. The directors considered a number of
options for the company but settled on the aged care business. On 19 December 2019 the company
announced that it had entered into a conditional agreement with Tom Brankin and his interests to
acquire their aged care assets for a mixture of cash and equity.
These assets are profitable and provide the basis for the company to expand in the aged care sector.
There is considerable demand for new and large facilities as a result of demographic pressure from
New Zealand’s ageing population.
This acquisition is effectively a backdoor NZX listing of the Brankin aged care assets and there is
considerable regulatory compliance required to give effect to such a transaction. The company is
preparing the documentation required by the Takeovers Panel, the Financial Markets Authority and
NZX. It is a time consuming and expensive undertaking but good progress is being made.
It is expected that documents will be sent to shareholders in April for consideration and that a
meeting of shareholders will be held in late April to vote on the proposed change of business and the
Brankin transaction.
Share Suspension
On 19 December 2019 when the company announced a proposed change of business and conditional
purchase of aged care assets, it also requested suspension of trading in the company’s shares on the
NZX. The reason for the suspension is to allow time for the necessary documentation to undertake
the review and approval processes by the various regulatory authorities prior to being sent to
shareholders. It is intended that the trading suspension will be lifted when all documents have been
sent to shareholders.
Summary
2019 was a very difficult but busy year for the company. Your directors consider that the proposed
change of business is in the interests of all shareholders and provides considerable growth
opportunities, particularly by way of acquisition.
The directors thank shareholders for their support during the year.
Stephen Underwood

Chairman
25 March 2020

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PEOPLE – BOARD OF DIRECTORS

Mr S. Underwood BCA LLB (VUW) Chairman
Stephen Underwood is a business and management consultant with an extensive background in
venture capital investment. He is a director of a number of private companies.

Mr M.D. Priest
Duncan Priest has a long association with the New Zealand capital markets, equity financing and
investment banking. He has considerable experience in raising capital from both the retail and
wholesale markets.

Mr T.D. Brankin Dip Agriculture & Dip Farm Management (Lincoln)
Thomas Brankin is a New Plymouth based businessman with significant interests in rest homes,
hospitals and retirement villages. His other interests include commercial and residential property and
farm management software.

Ms H. Down BCA (VUW) FCIM

Helen Down is a well known Wellington-based subject matter expert in both marketing and
governance. Helen is recognised for being instrumental in the growth of innovative and exciting small
and medium sized businesses, especially across the STEMM sectors.

MANAGEMENT
Mr Rene de Wit MSc Chem/MBA (Otago) CEO
Rene de Wit is an accomplished CEO and Change Manager with 25 years’ experience in FMCG, Food
Manufacturing, Printing, Packaging, Import/Export, Financial Services and Logistics. He has worked
in corporate, privately owned and own business, specialising in turnarounds and change management.

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GOVERNANCE
The overall responsibility for ensuring that the Company is governed appropriately rests with the
Board of Directors, ensuring that they enhance investor confidence through good corporate
governance practice and accountability in accordance with the Promisia Group Corporate Governance
Code – refer to www.promisia.com for the full document.
THE BOARD OF DIRECTORS
A key responsibility of the Board is to formulate the Company’s strategic direction. In addition, the
Board must have oversight of the financial and operational controls of the business including its risk
management policies and strategies.
The Board also has responsibility for fostering corporate culture, the appointment and remuneration
of its senior executives, the adoption of corporate policies and plans and the approval of major
transactions.

Selection and Role of Chairman
The Chairman is selected by the Board from the non-executive directors. The Chairman’s role is to
manage the Board in an effective manner and provide leadership in the conduct of the Board’s
business and to facilitate the Board’s interaction with the Company’s CEO.

Board Membership
The Board consists currently of three independent directors and one non-independent director as
defined under NZX Rules. All four directors are non-executive directors and were appointed by the
Board and have been confirmed in the role by shareholders at a duly constituted meeting. Their
selection has been based on the value they bring to the Board table including their skills, commercial
experience, strategic thinking and general business acumen.
As at 31 December 2019 the Board was as follows:
Stephen Underwood Chairman and Non-Executive Director
Duncan Priest Non-executive Director
Thomas Brankin Non-executive Director
Helen Down Non-executive Director
Brief profiles of the current board members are detailed on page 7 of this report.
Director Independence
In order for a director to be independent, the Board has determined that he or she must not be an
executive of Promisia Integrative Limited and must have no disqualifying relationship. The Board
follows the guidelines of the NZX Listing Rules.
The Board has determined that Helen Down, Duncan Priest, and Stephen Underwood are
independent directors.
Thomas Brankin and associated interests hold a 51.3% shareholding in Promisia Integrative Limited.
Nomination and Appointment of Directors
The Board is responsible for identifying suitable director candidates for consideration by the Board.
Directors may also be nominated by shareholders under Listing Rule 3.2.2.
A director may be appointed by an ordinary resolution of shareholders and all directors are subject to
removal by ordinary resolution. The Board may, at any time, appoint additional directors. However, a
director shall only hold office until the next annual meeting of the Company, but shall be eligible for
election at that meeting. One third of directors shall retire from office at the annual meeting each
year. The directors to retire shall be those who have been longest in office since they were last elected
or deemed to be elected.

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Directors’ Meetings
The number of meetings attended by directors during the year is detailed in the table below.
Board Meeting Audit Committee
Director Held Attended Held Attended
Stephen Underwood 7 7 - -
Duncan Priest 7 7 - -
Thomas Brankin 7 7 - -
Helen Down 7 7 - -
Disclosure of Interests by Directors
The Company maintains an Interests Register in which particulars of certain transactions and matters
involving directors must be recorded. The Interests Register for Promisia Integrative Limited and
subsidiaries is available for inspection at its registered office.
Details of matters entered into the register by individual directors are outlined on pages 35 and 36 of
this report.
Directors’ Share Dealings
As part of its corporate governance code of practice and charter development the Company has
adopted a formal share dealing policy which sets out the procedure to be followed by directors and
staff in the event of trading in Promisia Integrative Limited shares to ensure that no trades are
affected while that person is in possession of price sensitive information. Details of director and staff
share transactions are outlined on page 36.
Indemnification and Insurance of Directors and Officers
The Company holds Directors and Officers liability insurance.

BOARD COMMITTEES
Presently the Board operates only one committee, being the Audit Committee. Matters concerning
nominations to the Board of Directors and remuneration are dealt with by the full Board in keeping
with the size of the Company.
Audit Committee
The role of the Audit Committee is to assist the Board in carrying out its responsibilities under the
Companies Act 1993 as it concerns accounting practices, policies and controls relative to the
Company’s financial position and to make appropriate enquiry into any audit of the Company’s
financial statements. This responsibility includes providing the Board with additional assurance about
the quality and reliability of any financial information issued publicly by the Company from time to
time. Ultimately the Board as a whole is responsible for the accuracy and relevance of the Company’s
financial statements. The Audit Committee provides additional and more specialised oversight. The
Audit Committee also reviews the operation of internal controls together with the quality and cost of
the external audit undertaken by the Company’s auditors.
The Audit Committee comprises two non-executive directors one whom which has special expertise in
financial matters. The Audit Committee members are Stephen Underwood (Chair) and Duncan Priest.
The Audit Committee did not meet during the financial year, attending to all matters through the full
board meetings.

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Remuneration Committee
During the 2019 financial year the full Board dealt with the functions of the Remuneration
Committee. Matters considered related to the remuneration, benefits and terms of employment of
senior executives of the Company, including the staff unpaid share scheme.
Nominations Committee
During the 2019 financial year the full Board dealt with the functions of the Nominations Committee.
Its function is to identify and recommend candidates for the position of director of the Company
taking into account the skills, experience and qualifications necessary to ensure that the Board works
as an effective unit.

REMUNERATION
Remuneration of both directors and Company executives is a responsibility of the Remuneration
Committee, being the full board. Details of director and executive remuneration, including
entitlements, are set out on page 36.
Remuneration of Directors
The amount payable currently to all non-executive directors is $17,000 per annum (other than the
Chairman). The Chairman is paid $49,000 per annum. Under NZX Listing Rule 2.11.4, the Board may
only make a payment to a director upon cessation or retirement from office with shareholder
approval. The Company’s policy is in line with best practice guidelines from the New Zealand Institute
of Directors and no directors are entitled to retirement payments.
Remuneration of Executives and Employees
Executive remuneration consists of a salary with the ability to participate in share options being
granted from time to time as an additional incentive.
Market Disclosure
The Board is committed to the promotion of investor confidence by ensuring that trading of its shares
takes place in an efficient, competitive and informed market.
The Company has in place procedures designed to ensure compliance with the NZX Listing Rules so
that:
• All investors have equal and timely access to material information concerning the Company,
including its financial situation, performance, ownership and governance.
• Company announcements are factual and presented in a clear and balanced form.
Accountability for compliance with disclosure obligations is with the Chairman and the Chief
Executive Officer. Significant market announcements, including the preliminary announcement of the
half year and full year results, the accounts for those periods and any advice of a change in earnings
forecast are approved by the Board.

Diversity
As at 31 December 2019 the gender balance of the Company’s directors and senior management was
as follows:
Directors Management
Male 3 1
Female 1 -
Total 4 1

Promisia Integrative Limited
Independent auditor’s report to the Shareholders
Report on the Audit of the Consolidated Financial
Statements
Disclaimer of Opinion

We were engaged to audit the consolidated financial statements of Promisia Integrative
Limited and its subsidiaries (the Group), which comprise the consolidated statement of
financial position as at 31 December 2019, and the consolidated statement of
comprehensive income, consolidated statement of changes in equity and consolidated
statement of cash flows for the year then ended, and notes to the consolidated financial
statements, including a summary of significant accounting policies.

We do not express an opinion on the accompanying consolidated financial statements of
the Group. Because of the significance of the matters described in the Basis for Disclaimer
of Opinion section of our report, we have not been able to obtain sufficient appropriate
audit evidence to provide a basis for an audit opinion on these consolidated financial
statements.
Basis for Disclaimer of Opinion

As disclosed in Note 2(b), the Group has incurred a Net Loss for the year of $2.4 million
and has negative working capital and equity and is subject to litigation. The Directors
consider that the proposed Acquisition of Aged Care facilities as disclosed in Note 28 is
virtually certain to proceed. This transaction will re-capitalise the Company, provide
significant tangible assets and is expected to result in the Group achieving positive
cashflows and profit from operations from the acquisition date.

The transaction is subject to regulatory approval and shareholder vote. If the proposed
transaction did not proceed the Group could not continue to operate without obtaining
additional funding.

We have been unable to obtain sufficient appropriate audit evidence in respect of the
outcome of the regulatory approval and shareholder vote that would enable us to form an
opinion about the Group’s ability to continue as a going concern and therefore determine
the appropriateness of the going concern assumption.

Information Other than the Consolidated Financial Statements and Auditor’s
Report Thereon

The directors are responsible for the Annual Report. Our opinion on the consolidated
financial statements does not cover the other information included in the Annual Report
and we do not express any form of audit opinion or assurance conclusion on the other
information.

In connection with our audit of the consolidated financial statements, our responsibility is
to read the other information and, in doing so, consider whether the other information is
materially inconsistent with the consolidated financial statements or our knowledge
obtained in the audit or otherwise appears to be materially misstated. If, based on the work
we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.

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Directors’ Responsibilities for the Consolidated Financial Statements

The directors are responsible on behalf of the Group for the preparation of consolidated financial
statements that give a true and fair view in accordance with New Zealand equivalents to International
Financial Reporting Standards, and for such internal control as the directors determine is necessary to
enable the preparation of consolidated financial statements that are free from material misstatement,
whether due to fraud or error.

In preparing the consolidated financial statements, the directors are responsible for assessing the Group’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Our responsibility is to conduct an audit of the Group’s consolidated financial statements in accordance with
International Standards on Auditing (New Zealand) and to issue an auditor’s report. However, because of
the matter described in the Basis for Disclaimer of Opinion section of our report, we were not able to obtain
sufficient appropriate audit evidence to provide a basis for an audit opinion on these consolidated financial
statements.

We are independent of the Group in accordance with Professional and Ethical Standard 1 (Revised) Code
of Ethics for Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board,
and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Other than in our capacity as auditor we have no relationship with, or interests in, Promisia Integrative
Limited or any of its subsidiaries.

The engagement director on the audit resulting in this independent auditor’s report is Darren Wright.

Restriction on Distribution and Use

This report is made solely to the Company’s shareholders, as a body. Our audit work has been undertaken
so that we might state to the Company’s shareholders those matters which we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the Company and the Company’s shareholders, as a body, for
our audit work, for this report or for the opinions we have formed.



William Buck Audit (NZ) Limited
Auckland

25 March 2020

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FINANCIAL STATEMENTS
PROMISIA INTEGRATIVE LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2019

Note

2019
$000
2018
$000








Revenue 3 190 727
Cost of goods sold 4 (53) (218)
Impairment of inventory 4 (1,107) (313)
(970) 196
Other income 1 14
Expenses
Administration 5 (1051) (800)
Operating 5 (319) (1,637)
Research 5 - (116)
Amortisation and depreciation 5 (11) (28)
Total Expenses (1,381) (2,581)

OPERATING LOSS (2,350) (2,371)
Finance costs – interest paid (51) (42)
Finance income – interest received - 1
LOSS BEFORE INCOME TAX 8 (2,401) (2,412)
Income tax expense 6 - -
NET LOSS FOR YEAR (2,401) (2,412)
OTHER COMPREHENSIVE INCOME
Items that may be subsequently reclassified to profit
or loss

Currency translation differences 1 5
TOTAL COMPREHENSIVE LOSS FOR YEAR
ATTRIBUTABLE TO SHAREHOLDERS


(2,400)


(2,407)


EARNINGS PER SHARE

Basic earnings per share 9 $(0.001) $(0.004)

Diluted earnings per share 9 $(0.001) $(0.004)

All revenue, expenses and the net loss relate to the operations of the Group. Refer Note 29. The net loss and
comprehensive loss were all allocated to company shareholders.

This statement should be read in conjunction with the notes to the financial statements

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PROMISIA INTEGRATIVE LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2019

SHARE
CAPITAL

FOREIGN
CURRENCY
RESERVE

SHARE
OPTION
RESERVE

ACCUM
LOSSES

TOTAL

$000 $000 $000 $000 $000

Equity at 31 December 2017 56,041 177 51 (55,250) 1,019
Net loss for the year - - - (2,412) (2,412)
Other comprehensive income - 5 - - 5
Share Issue 2,169 - - - 2,169
Share based payment - - 17 - 17
Expired/Retired share options 68 - (68) -
Equity at 31 December 2018 58,278 182 - (57,662) 798
Net loss for the year - - - (2,401) (2,401)
Other comprehensive income - 1 - - 1
Share Issue 248 - - - 248
Equity at 31 December 2019 58,526 183 - (60,063) (1,354)














This statement should be read in conjunction with the notes to the financial statements.

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PROMISIA INTEGRATIVE LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2019
Note 2019
$000
2018
$000
Equity
Share Capital
7
58,526 58,278
Accumulated Losses
8
(60,063) (57,662)
Foreign Currency Reserve

183 182
TOTAL EQUITY (DEFICIT)

(1,354) 798



Represented By :


Current Assets


Bank

21 512
Receivables
10
34 53
Inventory
11
- 1,156
Prepayments

1 4
Tax Receivable

6 5
TOTAL CURRENT ASSETS

62 1,730



Non-Current Assets


Other Assets
14
20 75
Intangible Assets
13
- 11
Property, Plant & Equipment
12
3 35
TOTAL NON CURRENT ASSETS 23 121

TOTAL ASSETS 85 1,851

Current Liabilities
Payables and Accruals
15
565 261
Employee benefits

19 8
Loan
16
855 784
TOTAL CURRENT LIABILITIES 1,439 1,053



TOTAL LIABILITIES 1,439 1,053

NET (LIABILITIES) ASSETS (1,354) 798
Authorised for issue on behalf of the Board





Stephen Underwood Tom Brankin Wellington
Chairman Director 25 March 2020

This statement should be read in conjunction with the notes to the financial statements.

16
PROMISIA INTEGRATIVE LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2019
Note 2019
$000
2018
$000

OPERATING ACTIVITIES
Cash was provided by (applied to):
Receipts from customers 202 741
Payments to suppliers and employees (1,070) (2,500)
Net interest paid - (40)
NET CASH USED IN OPERATING ACTIVITIES 21 (868) (1,799)



INVESTING ACTIVITIES
Cash was provided from (applied to):
Refund of NZX deposit 55 -
Sale of plant & equipment 18 -
Purchase property, plant & equipment - (39)
Purchase intangible assets - (8)
NET CASH USED IN INVESTING ACTIVITIES 73 (47)

FINANCING ACTIVITIES
Cash was provided from (applied to):
New share capital 247 2,169
Advance (repayment) of loan 22 57 (135)
NET CASH FROM FINANCING ACTIVITIES 304 2,034



NET CHANGE IN CASH HELD (491) 188
Bank at beginning of year 512 324
BANK AT END OF YEAR 21 512








This statement should be read in conjunction with the notes to the financial statements.

17
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2019
1. General Information
The financial statements presented are those of Promisia Integrative Limited (the company) and its
subsidiaries (the group). The Group’s principal activities were focused on developing and marketing
unique therapeutic natural products with proven safety and efficacy based on robust scientific
research.
The company is registered under the Companies Act 1993 and is a Financial Markets Conduct
reporting entity in terms of the Financial Markets Conduct Act 2013. The group is profit-oriented.
Promisia Integrative Limited is a company domiciled and incorporated in New Zealand. The
registered office of the company is Level 5, 22 Panama Street, Wellington.
2. Statement of Accounting Policies
(a) Basis of Preparation
The financial statements have been prepared under the historical cost convention.
These financial statements have been prepared in accordance with generally accepted accounting
practice in New Zealand, which is the New Zealand equivalent to International Financial Reporting
Standards (NZIFRS). They also comply with International Financial Reporting Standards.
The financial statements are presented in New Zealand dollars which is the group’s functional and
presentation currency and rounded to the nearest thousand dollars unless stated otherwise.
(b) Going concern
The Promisia Group has generated sales of $190,000 (2018: $727,000) and net losses of $2,400,000
(2018: $2,407,000) during the year ended 31 December 2019. At year end the consolidated
statement of financial position records a position of negative working capital and negative equity.
It is the continuing opinion of the board of directors that there are reasonable grounds to believe that
operational and financial plans in place are achievable and accordingly the group is able to continue as
a going concern and meet its debts as and when they fall due. Accordingly, use of the going concern
assumption remains appropriate in these circumstances.
In arriving at this position the directors have considered the following pertinent matters:
(i) The directors consider the proposed acquisition of the aged care facilities as disclosed in Note
28 is virtually certain to proceed. The transaction will recapitalise the Company, provide
significant tangible assets and is expected to result in the Group achieving positive cash flows
and profit from operations from acquisition date. If the proposed acquisition did not proceed
the Group could not continue to operate without obtaining additional funding.
3. (ii) considered the impact of the Ministry of Health prosecution – Refer Note 24.
(c) Significant accounting estimates and judgements
The preparation of the financial statements in conformity with NZIFRS requires the use of certain
critical accounting estimates. It also requires management to exercise judgment in the process of
applying the Group’s accounting policies. Estimates and judgments are continually evaluated and are
based on historical experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. The Group makes estimates and assumptions
about the future. The resulting accounting estimates will by definition seldom equal related actual
results. The estimates and assumptions that have a risk of causing a material adjustment to the
carrying value of assets and liabilities within the next financial year are discussed below:

18
Impairment of intangible assets
Intangible assets are amortised and are tested for impairment when events or changes in
circumstances indicate the carrying value may not be recoverable ( Refer Note 13).
Inventory
Inventory has been reviewed for obsolescence and all unsaleable inventories have been fully impaired
in accordance with the group’s inventory policy.
(d) Specific accounting policies
The following specific accounting policies which materially affect the measurement of profit and the
financial position have been applied.
(i) Basis of consolidation — purchase method
The consolidated financial statements include the company and its subsidiaries accounted for using the
purchase method. All significant inter-company transactions are eliminated on consolidation.
(ii) Statement of Cash flows
For the purpose of the cash flow statement, cash includes cash on hand, deposits held at call with
banks, and investments in money market instruments, net of bank overdrafts.
Cash flows are presented in the statement of cash flows on a GST inclusive basis, except for the GST
components of investing and financing activities, which are disclosed as operating cash flows.
(iii) Foreign currencies
Transactions in foreign currencies are initially recognised in the functional currency of the relevant
operating unit. At balance date, foreign monetary assets and liabilities are translated at the closing
rate, and exchange variations arising from these translations are recognised in the income statement.
The assets and liabilities of foreign operations, whose functional currency is not the New Zealand
dollar, are translated at the closing rate. Revenue and expense items are translated at the spot rate at
the transaction date or a rate approximating that rate. Foreign currency exchange differences are
recognised in the foreign currency translation reserve.
(iv) Goods and Services Tax (GST)
The statement of comprehensive income has been prepared exclusive of GST. All items in the
statement of financial position are stated net of GST with the exception of receivables and payables
which include GST invoiced. Operating cash flows are presented on a GST inclusive basis.
(v) Revenue recognition - performance obligations and timing
The majority of the group’s revenue is derived from selling goods with revenue recognised at a point in
time when control of the goods has transferred to the customer. This is generally when the goods are
delivered to the customer.
However, for export sales, control might also be transferred when delivered either to the port of
departure or port of arrival, depending on the specific terms of the contract with a customer. There is
limited judgement needed in identifying the point control passes: once physical delivery of the
products to the agreed location has occurred, the group no longer has physical possession, usually will
have a present right to payment (as a single payment on delivery) and retains none of the significant
risks and rewards of the goods in question.
Sales of goods are categorized as retail, on line and other sales.
(vi) Lease costs
Where the Group is the lessee, then operating leases or finance leases (“leases”) are recognised as
assets and liabilities for all leases with a term of more than a year including the right of renewals of
for future periods, unless the underlying asset is of low value.

19
The value of the asset leased is initially recorded as a right of use (‘ROU’) asset and is measured
at the initial present value of the total lease payments including initial direct costs and prepayments
made to lessor less any lease incentives received from the lessor, restoration, removal and
dismantling costs (“lease costs”). Recognition of a lease liability is measured and calculated using
the initial measurement of the present value of the total lease costs. The lease payments are discounted
using the Group’s incremental borrowing rate.
(vii) Taxation
The income tax expense charged to the statement of comprehensive income includes both the current
year’s provision and the income tax effect of (i) Taxable temporary differences, except those arising
from initial recognition of goodwill and other assets that are not depreciated; and (ii) Deductible
temporary differences to the extent that it is probable that they will be utilised. Temporary differences
arising from transactions, other than business combinations, affecting neither accounting profit nor
taxable profit are ignored.
Tax effect accounting is applied on a comprehensive basis to all temporary differences. A deferred tax
asset is only recognised to the extent that it is probable there will be future taxable profit to utilise the
temporary differences.
(viii) Share capital
Ordinary shares are classified as equity. Direct costs of issuing shares are shown as a deduction from
the proceeds of the issue. Where share options issued have expired then share capital includes an
adjustment for the expired share option cost as transferred from the option reserve.
(ix) Share based payments
The Group measures the cost of equity-settled transactions with directors and management by
reference to the fair value of the equity instruments at the date at which they are granted. Estimating
fair value for share-based payment transactions requires determination of the most appropriate
valuation model, which is dependent on the terms and conditions of the grant. This estimate also
requires determination of the most appropriate inputs to the valuation model including the expected
life of the share option, volatility and dividend yield and making assumptions about them.
All share-based remuneration is ultimately recognised as an expense in profit or loss with a
corresponding credit to share option reserve. If vesting periods or other vesting conditions apply, the
expense is allocated over the vesting period, based on the best available estimate of the number of
share options expected to vest.
Upon exercise of share options, the proceeds received net of any directly attributable transaction costs
are allocated to share capital.
(x) Financial instruments
Non-derivative financial instruments comprise trade and other receivables, cash and cash equivalents,
other assets (being the NZX listing bond), loans and advances to others, trade and other payables and
term borrowings. They are all recognised initially at fair value plus any directly attributable
transaction costs.
Subsequent to initial recognition, these financial instruments are measured at amortised cost using
the effective interest method, less any impairment losses. Due to their short-term nature, the carrying
value of cash and cash equivalents, trade and other receivables, trade and other payables
approximates their fair value.
A financial instrument is recognised if the Group becomes a party to the contractual provisions of the
instrument. Financial assets are derecognised if the Group’s contractual rights to the cash flows from
the financial assets expire or if the Group transfers the financial asset to another party without
retaining control or substantively all risks and rewards of the asset. Financial liabilities are
derecognised if the Group’s obligations specified in the contract expire or are discharged or cancelled.

20
Cash and cash equivalents comprise cash balances and deposits. Bank overdrafts that are repayable on
demand and form an integral part of the Group’s cash management are included as a component of
cash and cash equivalents for the purpose of the Consolidated Statement of Cash Flows.
The Group does not have any derivative financial instruments or any other financial assets or
liabilities that are classified as instruments at fair value through profit and loss under NZ IFRS.
(xi) Receivables and payables
Receivables and payables are initially recorded at fair value and subsequently carried at amortised cost
using the effective interest method. Due allowance is made for impaired receivables (doubtful debts).
(xii) Employee benefits
A liability for short-term employee benefits accruing to employees in respect of salaries and annual
leave other than termination benefits, that are expected to be settled wholly within 12 months after the
end of the reporting period are accrued and recognised in the consolidated statement of financial
position. Short-term employee benefits as a result of employee services are measured at the
undiscounted amounts expected to be paid when the liabilities are settled.
The group has no long term benefits.
(xiii) Inventories

Inventories are stated at the lower of cost, determined on a first-in first-out basis, and net realisable
value after making any allowance for obsolescence or degradation.

(xiv) Intangible Assets
Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and
install the specific software. Costs that are associated directly with the development of software are
recognised as intangible assets where the following criteria are met:
For external developed software - expenditure on the research phase of a project to develop new
customised software for e-commerce platforms is recognised as an expense as incurred. Costs that are
directly attributable to a project’s development phase are recognised as intangible assets, provided
they meet the following recognition requirements: (i) the development costs can be measured reliably
(ii) the project is technically and commercially feasible (iii) the Group intends to and has sufficient
resources to complete the project (iv) the Group has the ability to use or sell the software (v) the
software will generate probable future economic benefits.
Development costs not meeting these criteria for capitalisation are expensed as incurred.
The useful lives of the Group’s intangible assets excluding trademarks are assessed to be finite. Assets
with finite lives are amortised over their useful lives and tested for impairment whenever there are
indications that the assets may be impaired. Trademarks are not amortised and are reviewed
annually to ensure they are still applicable and registered.
Amortisation is recognised in the statement of comprehensive income on a straight-line basis over the
estimated useful life of the intangible asset of 3 to 5 years, from the date it is available for use.
(xv) Plant and equipment
Plant and equipment is initially recorded at cost. When an item of property, plant and equipment is
disposed of any gain or loss is recognised in the Consolidated Statement of Comprehensive Income
and calculated as the difference between the sale price and the carrying value of the item.
Depreciation is provided for on a diminishing value basis on all plant and equipment at depreciation
rates calculated to allocate the assets’ cost or valuation less estimated residual value over their
estimated useful lives.
Major depreciation periods are plant and equipment 5 to 15 years.
Assets are fully written off when no longer in use by the Group.

21
(xvi) Impairment
At each reporting date, the group reviews the carrying amounts of its tangible and intangible assets to
determine whether there is any indication that those assets have suffered an impairment loss. If any
such indication exists, the recoverable amount of the asset is estimated in order to determine the
extent of the impairment loss (if any).
Recoverable amount is the higher of the fair value less costs to sell and value in use.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying
amount of the asset is reduced to its recoverable amount. An impairment loss is recognised in profit or
loss immediately, unless the relevant asset is carried at fair value, in which case the impairment loss is
treated as a revaluation decrease.
Where an impairment loss subsequently reverses, other than for goodwill, the carrying amount of the
asset is increased to the revised estimate of its recoverable amount, but only to the extent that the
increased carrying amount does not exceed the carrying amount that would have been determined had
no impairment loss been recognised for the asset in prior years. A reversal of an impairment loss is
recognised in the statement of comprehensive income immediately, unless the relevant asset is carried
at fair value, in which case the reversal of the impairment loss is treated as a revaluation increase.
(xvii) Changes in accounting policies
There have been no changes to the accounting policies for the year ended 31 December 2019.
The following standard - NZIFRS 16: Leases became effective for period beginning on or after 1
January 2019. It was adopted and had no significant effect on the Group’s financial statements as at
31 December 2019. There were no other standards required to be adopted during 2019.
(xviii) Change in comparatives
Upon further consideration and review of the loan terms and conditions, it was determined that the
comparative figures of the loan amount should be classified as current at the reporting date. As such,
the loan was reclassified from non-current to current in the prior year.
3. Revenue
2019
$000
2018
$000
Retail 140 493
On– line 37 82
Other 13 352
Total Revenue 190 727

4. Cost of Goods Sold and Impairment
2019
$000
2018
$000
At 1 January –inventory 1,156 1,383
Purchases 4 303
Impairment of inventory (1,107) (313)
At 31 December - inventory - (1,156)
Cost of goods sold
53 218

22
5. Analysis of Expenses
2019
$000
2018
$000
Administration

Auditor’s remuneration 39 28
Provision for doubtful debts 6 -
Directors’ fees 100 100
Foreign exchange (gain) loss - 7
Legal & professional 314 22
NZX listing & registry 38 48
Rental 28 48
Share based payment - 17
Staff & employment costs 365 344
Other 161 186
Total Administration 1,051 800
Operating
Distribution 140 411
Marketing 90 1,057
Impairment of intangible assets 14 105
Other operating costs 75 64
Total Operating 319 1,637
Research

Employment costs

- 93
Other research - 23
Total Research Expenses - 116
Amortisation and depreciation 11 28
TOTAL EXPENSES 1,381 2,581

6. Taxation

2019
$000
2018
$000
Net (Loss) for year - (note 8)

(2,401) (2,412)
Taxation @ 28 cents

- -

23
The Group has $ 1,294,000 (2018: nil) of New Zealand domiciled entity tax losses to offset against
future taxable income.
The current tax losses of 2,401,000 and 49% shareholder continuity are subject to IRD approval. To
offset these tax losses against future taxable income, a 49% continuity of ultimate shareholders must
own the Company’s shares from beginning of the year of the loss to the end of the year of offset. The
company met this condition at 31 December 2019. At 31 December 2018 it did not meet this
condition and lost the ability to offset accumulated losses of $5,734,887 to 31 December 2018
against future taxable income.
There are no imputation credits available to shareholders (2018: $nil).
Deferred tax
No deferred tax asset has been recognised. Any future tax losses and deferred tax assets of $310,000
(2018: nil) will be recognised at the time that it is considered probable that future taxable profits are
available to offset these tax losses and continuation of shareholding maintained.
7. Share Capital
The Group’s share capital includes fully paid and subscribed ordinary shares 0f 2,151,797,451 and
unpaid ordinary shares of 16,595,856 totalling 2,169,393,367 (2018: 1,918,393,307). All fully
paid ordinary shares carry full and equal voting rights, share equally in distributions and have no
par value. Movements in the issued and unissued ordinary shares are set out below:
7.1 Fully paid ordinary shares
There were 2,151,797,451 (2018: 1,901,797,451) fully paid ordinary shares on issue at balance date.
The ordinary shares do not have a par value.
2019
Number of
shares
(000)

2018
Number of
shares
(000)

2019
$000
2018
$000
At 1 January
1,901,797 508,959 58,278 56,041
New subscribed and paid capital 250,000 1,392,838 250 2,300
Expired/Retired options
- -
- 68
Issue costs - - (2) (130)
At 31 December 2,151,797 1,901,797 58,526 58,278
New subscribed capital of 250,000,000 shares was issued and fully paid for $250,000 - refer Note
18.2(d)
7.2 Unpaid ordinary shares – Treasury shares
There were 0f 16,595,856 (2018: 16,595,856) available for issue at balance date as part of the Staff
Unpaid Share Scheme for eligible staff, being employees or contractors, to purchase.
The unallocated and unpaid ordinary shares are held by a nominee company, Promisia Trustee
Limited. The unpaid shares were cancelled in February 2020.
7.3 Option Scheme
On 1 September 2014 the company granted further options totalling 17.08 million to the directors and
management of the company which fully expired by 29 May 2018. There was no option scheme in
place during 2019. Share based payments of nil were paid out during 2019 (2018:17,000).

24
8. Accumulated Losses
2019
$000

2018
$000
At 1 January (57,662) (55,250)
Net loss for the year (2,401) (2,412)
At 31 December (60,063) (57,662)
9. Earnings per share


2019
$000
2018
$000
Net Loss for year

(2,401) (2,412)
Basic earnings per share $(0.001) $(0.004)
Diluted earnings per share $(0.001) $(0.004)

Number of
shares

Number of
shares


000 000
Weighted average number of shares for basic EPS 2,151,797 668,800
Weighted average number of shares for diluted EPS 2,157,797 640,082
The calculation of basic earnings per share is based on the loss from continuing operations
attributable to ordinary shareholders and the weighted average of total ordinary shares on issue
during the year. The calculation of diluted earnings per share is based on the loss from continuing
operations attributable to ordinary shareholders and the weighted average number of ordinary shares
assuming there are share options to be exercised in full as at 31 December 2019 - Refer Note 7.3 for
further details.

10. Receivables


2019
$000
2018
$000
Current Receivables

Trade and other receivables 20 26
Other taxes 14 27
Total current receivables 34 53
A provision for impairment of $6,000 over receivables was made during 2019 (2018:Nil).

25
11. Inventory
2019
$000
2018
$000
Raw materials and extract 888 887
Finished product 208 582
Provision for impairment – refer note 11.1 (1,096) (313)
Total Inventory - 1,156

11.1 Provision for inventory impairment

2019
$000
2018
$000
Opening balance 313 -
Recognised in the year 1,107 313
Utilised in the year (224) -
Closing balance - refer note 11 1,096 313
Inventory was impaired by $1,107,000 during 2019 in the statement of comprehensive income as part of cost
of goods sold. (2018 $313,000) - refer Note 4.

12. Property Plant & Equipment
2019
$000
2018
$000
Plant & Equipment Gross carrying amount
At 1 January 48 9
Additions - 39
Disposals (33) -
At 31 December 15 48
Accumulated depreciation
At 1 January (13) (2)
Disposals 10 -
Depreciation (9) (11)
At 31 December (12) (13)
Carrying amount at 31 December

3
35

26
13. Intangible Assets
2019
$000
Website
2019
$000
Trademarks

2019
$000
Total

Gross carrying amount
At 1 January 142 49 191
Additions - - -
At 31 December 142 49 191
Accumulated amortisation
At 1 January (131) (49) (180)
Amortisation (2) - (2)
Provision for impairment (9) - (9)
At 31 December (142) (49) (191)
Carrying Amount at 31 December - - -

2018
$000
Website
2018
$000
Trademarks
2018
$000
Total

Gross carrying amount

At 1 January 142 41 183
Additions - 8 8
At 31 December 142 49 191
Accumulated amortisation

At 1 January (58) - (58)
Amortisation (17) - (17)
Provision for impairment (56) (49) (105)
At 31 December (131) (49) (180)
Carrying Amount at 31 December 11 - 11

14. Other Assets

2019
$000
2018
$000
NZX Listing Bond

During the year $55000 of the bond was paid back to the company by NZX





20 75

27
15. Payables and Accruals
2019
$000
2018
$000
Current
Trade payables 303 127
Other payables 2 23
Accruals 260 110
Total Payables and Accruals 565 261

16. Loan
2019
$000
2018
$000
Current liability

Loan 855 784
At 31 December 2019 the balance of the loan was $855,175.
On 1 October 2018, the loan from Wells Investment Limited was assigned to the Brankin Family
Interest Trust. Interest was charged at a rate of 6.5% p.a from 1 February 2019. The Brankin Family
Interest Trust advanced a further $57,000 to the company during the year and interest was charged
at 8% p.a. The $57, 0000 advance and loan of $798,175 are repayable upon demand. In March 2020,
the Brankin Family Interest Trust has undertaken not to make a request for repayment of the loan of
$798,175 until at least March 2021.
The Brankin Family Trust is a related party to T.D Brankin, a shareholder and a director of the Group.
Details of the security granted over the loan are set out in Note 17.
17. Securities Granted
Brankin Family Interest Trust holds security over the assets of the Group in priority to all or any
other lender until such time the loan is repaid.
18. Related Party Information
The Group has related party relationships with its controlled entities, and key management as follows:
18.1 Investments in Subsidiaries
The subsidiaries (controlled entities) held by the parent company were as follows:

PRINCIPAL
ACTIVITIES

COUNTRY
OF
INCORPORATION

COST

$

INTEREST
HELD BY
GROUP

%
Promisia Limited
Distribution &
Manufacture
New Zealand - 100
Benefit Arthritis Limited Distribution New Zealand - 100
Promisia Trustee Limited Trustee New Zealand - 100
Promisia Australia Pty Limited Distribution Australia 113 100
Promisia LLC Distribution USA - 100

28
18.2 Related Party Transactions and Balances
(a) As at 31 December 2019, accrued directors’ fees and expenses were payable to:
2019
$000
2018
$000
T.D. Brankin

14
-
S. Underwood 41 -
M.D. Priest 14 -
H.Down 15 2
Total 84 2

2019
$000
2018
$000
Director fees for the year

100
100

During the year the company entered into the following related party transaction:
Consulting fees of $8,775 (2018 $60,250) were paid to Helen Down, a director and
shareholder of the company. All transactions were conducted on normal trading terms.

(b) No debts with related parties have been written off or forgiven during the year. The loan and
advance balances by the directors are not secured and interest is not charged.
Refer to Note 16 for details of a loan from the Brankin Family Trust which is related to one of
the directors – T D Brankin.
(c) Transactions with key management


2019
$000
2018
$000
Key management remuneration
200 200
Share based payment - 17


(d) Issue of shares to directors
On 12 December 2018 the company’s major shareholder, Brankin Family Interest Trust, was
granted the option to subscribe for 250 million shares at a price of $0.001 per share. These
additional shares were approved by a special meeting of shareholders on 4 December 2018.
The 250 million shares represented shortfall shares not taken up by eligible shareholders in
the rights issue that closed on 24 December 2018.
The shares were issued fully paid on 12 December 2019.
No shares were issued to the other directors of the company.

29
19. Financial Instruments
The following financial assets and liabilities by categories are as follows:
2019
Carrying

Amount
$000
2019
Fair

Value
$000
2018
Carrying

Amount
$000
2018
Fair

Value
$000
Cash 21 21 512 512
Receivables 34 34 53 53
Investments 20 20 75 75
Payables (584) (584) (269) (269)
Loan (855) (855) (784) (784)
All carrying amounts of all financial assets are classified under the category of loans and receivables.
All financial liabilities are categorised at amortised cost.
Fair value measurement
The Group does not have any derivative financial instruments or any other financial assets or
liabilities that are classified as instruments at fair value through profit and loss under NZ IFRS.
The fair value of the financial assets and liabilities approximates their carrying value.
Interest Rate Risk
Interest rate risk is the risk that interest rates will change, increasing or decreasing the cost of
borrowing or lending. The interest payable on loans to 31 December 2019 was fixed at 6.5% and 8%
per annum for two loans. (2018: 6.5% per annum) – Refer Note 16.
Credit Risk
Credit risk is the risk that an outside party will not be able to meet its obligations to the holding
company or group. Financial assets which will potentially subject the Group to concentrations of
credit risk consist principally of cash and receivables. The cash is placed with high credit quality
financial institutions with a minimum short term Standard and Poor’s credit rating of A-1. In the
normal course of its business, the Group incurs credit risk from receivables and transactions with
financial institutions. The maximum credit risk is the carrying amounts of trade and other receivables
of $14,000 which $11,000 have an ageing duration of less than 6 months and no defaults - (2018
$26,000) – Refer Note 10.
The Group does not require any collateral or security to support financial instruments as it only
deposits with, or loans to, banks and other financial institutions with high credit ratings. The Group
does not expect the non-performance of any obligations at balance date.
Currency Risk
Exposure to currency risk arises in the normal course of the Group’s business. The Group monitors
exchange rate movements in foreign currencies and will take any action necessary to reduce currency
risks where possible.
Liquidity Risk
The Group manages its liquidity risk by maintaining availability of sufficient cash and funding via
adequate credit and bank facilities. Owing to the nature of the underlying business, the Group aims to
maintain funding flexibility through committed credit lines. The Group manages liquidity risk by
monitoring actual and forecast cash flows on a regular basis and rearranging banking and credit
facilities where appropriate.

30
The table below analyses the Group’s non derivative financial liabilities into maturity groupings based
on the remaining period from balance date to the contractual maturity date if applicable. The amounts
disclosed are the contractual undiscounted cash flows.

Current Current Non-
Current

Total
Within 6
months

6-12
months

1 to 5
years


$000 $000 $000 $000
Interest bearing loans 57 - 798 855
Payables and accruals 565 - - 565
Total 612 - 798 1,420
The Group does not have the ability to meet its current obligations. It expects the proposed aged care
acquisition to proceed and to recapitalise the Group. Refer Note 28.
20. Segmental Reporting
The Group derives its revenue from the sale of one product in New Zealand with all revenue and assets
accounted for in New Zealand. The Group also had a wide range of customers with no single
customer contributing more than 10% of the Group’s revenue. It had one operating segment which
has been determined and based on financial information that is regularly reviewed by senior
management. NZ IFRS 8 Operating Segments: permits the aggregation of operating segments into
reportable segments. This has been adopted as the Group has only one operating segment with similar
economic characteristics being the production processes, customers and distribution channels for its
product. Based on this analysis, no additional disclosure is required in the annual financial
statements as the Group has one reportable segment. Refer Note 29 (b).

31
21. Reconciliation of Cash Flows from Operating Activities

2019
$000
2018
$000
NET (LOSS) FOR THE YEAR

(2,400) (2,412)
Adjustments for non-cash items:
-Amortisation 2 17
-Depreciation 9 11
-Foreign exchange differences - 5
- Impairment of debtors 6 -
- Impairment of intangible assets - 104
- Impairment of inventory 1,107 313
- Loss sale plant & equipment 15 -
- Share based payment benefits - 17
Net changes in working capital:
Change in inventories 48 57
Change in payables and accruals 294 (68)
Change in receivables, GST and prepayments 51 167
NET CASH FROM OPERATING
ACTIVITIES
(868) (1,799)
22. Reconciliation of Cash Flows from Financing Activities
The movement in loan liabilities to 31 December 2019 and the effect of non-cash transactions arising
from financing these cash flow activities is shown below.

Loan

2019
$000
2018
$000
At 1 January 784 919
Advances (loan repayments)
Non cash flow items
57

(135)

Other loan movements 14 -
At 31 December 855
784
23. Capital Management
For the purpose of the Group’s capital management, capital includes issued capital and all other
equity reserves attributable to the equity holders of the parent. Net debt includes borrowings less bank
funds.
The group’s capital management objectives are to safeguard the group's ability to continue as a going
concern in order to provide returns for shareholders and benefits for other stakeholders and to
maintain an optimal capital structure to reduce the cost of capital.
The directors anticipate being able to raise additional equity funds as and when required – to fund
the proposed aged care acquisition - refer Note 28.
The amount of capital, cash and net debt that the Group has for the year at the reporting date is
summarised as follows:

32
2019
$000
2018
$000
Total (Negative)Equity (1,354) 798
Borrowings (855) (784)
Bank 21 512
Net (debt) cash (834) (272)

24. Contingent Liabilities
At 31 December 2019, the company had the following contingent liability:
Notice of prosecution
On 7 February 2019 the company was served with a notice of prosecution by the New Zealand
Ministry of Health for nine alleged breaches of the Medicines Act 1981. In these charges the Ministry
alleges that the company has sold an unlicensed medicine and that certain advertising by the company
is in breach of the Medicines Act.
The company intends to defend all charges and has made three brief appearances in the District Court
with little progress being made to set a hearing date.

The maximum fine per charge is $100,000 but fines for previous convictions for these offenses have
been significantly lower than the maximum permitted.

There were no other contingent liabilities at 31 December 2019. (2018:$nil).

25. Operating Commitments
The group had the following operating commitments:


2019
$000
2018
$000
Less than 1 year - 48
Between 1 and 3 years - 23
Total - 71
The company no longer rents office space and has no leasing commitments.
In 2018 it had an operating lease to lease space under an operating lease which was cancellable.
Operating lease payments, where the lessors effectively retain substantially all of the risks and benefits
of ownership of the leased items, are recognised in the determination of the operating result in equal
instalments over the lease term.
26. Capital Commitments
There are no capital commitments at 31 December 2019 (2018: $nil).

27. Auditor’s Remuneration
Audit fees of $25,000 (2018 $27,000) were provided for the audit of the financial statements only. No
other services were provided
.

33
28. Proposed acquisition of Aged Care Facilities
The Group has entered a conditional agreement to acquire:
(i) Three aged care facilities for $31.3m. This acquisition will involve the purchase of assets and
assumption of certain liabilities; and
(ii) a lease on a property to be used as an aged care facility.
This agreement consists of the Group acquiring:
• the Ranfurly Manor and Nelson Residential Care Centre in Feilding and Eileen Mary
Residential Care Centre in Dannevirke.
• a long term lease of Aldwins House in central Christchurch with a view to opening it as a rest
home/hospital in 2020. An option to purchase the property from interests associated with Mr.
Ian Cassels of The Wellington Company Limited is included in the acquisition.

The Group is negotiating terms for debt finance of $17.3m, new equity issuances proposed of $8m to
the vendor and $6m-$8m to various private placement participants, all at 0.1c per share.

The proposed acquisition is subject to shareholder vote and prior approval of all documentation
related to the proposed acquisition of aged care facilities, by the NZX and Financial Markets
Authority.

29. Subsequent Events
(i) The Group has submitted documentation to NZX and FMA for their approval prior to release
to shareholders.
(ii) On 14 February 2020 the company announced that it would cease all sales of Arthrem. This is
as a result of the recommendation to the Ministry of Health by the Medicines Classifications
Committee that artemisia annua be classified as a prescription medicine. Refer Note 2(b) on
going concern.
Due to the reclassification of artemisia annua as a prescription only medicine, the company
will no longer trade in its present form. Future activity will depend on the outcome of the
proposed aged care acquisition - Refer Note 28.

34
SHAREHOLDER AND STATUTORY INFORMATION
Stock Exchange Listing
The Company’s fully paid ordinary shares are listed on the main board equity security market
operated by NZX Limited under the call sign (PIL).
Principal Ordinary Shareholders as at 20 March 2020
The following table lists the names and holdings of the 20 largest holding parcels of quoted ordinary
shares of the Company as at 20 March 2020
Holder Number Held % Held
T.D.Brankin & M.J.Kirwin Lay
S.P.Ward & J.P. Ward & J.M.Ward
J.M. Obrien
S..Underwood
E.M.M. Johnson
E.M.M. Johnson & K. Johnson
G.C. Royal
P. McVeigh
Tirol Nominees Limited
M.D.Priest
D.J. Robinson
ASB Nominees Limited
Bank Of America Merril Lynch International Dac
B.W. J. Anderson
J.P. Ward
G.R. Wells
R.D. Angus
Central Nominees Limited
Wells Investments Limited
S.A. Armstrong
1 11,103,804,210
74,391,081
73,929,066
60,775,560
48,818,720
44,570,320
43,508,830
28,589,017
28,083,413
26,836,315
24,626,281
18,000,000
12,854,532
12,750,000
12,351,498
11,915,613
11,847,545
11,314,238
10,603,968
10,020,779
51.30
3.46
3.44
2.82
2.27
2.07
2.02
1.33
1.31
1.25
1.14
0.84
0.60
0.59
0.57
0.55
0.55
0.53
0.49
0.47






1,669,590,986 77.6

35
Total Shares on Issue
No Holders Shares Held % Held
Top 20
20 1,669,590,986 77.60
Other Investors 1,420 482,206,465 23.40
Total 1,440 2,151,797,451 100.00

Spread of Ordinary Shareholders as at 20 March 2020
Holding Range No of Holders Total Shares %

1-1,000
9 3,732 0.00
1,001-5000 349 1,084,576 0.05
5001-10,000 162 1,266,941 0.06
10,001 -50,000 336 8,744,380 0.41
50,001-100,000 141 10,798,761 0.50
100,001 or more 443 2,129,899,061 98.98
Total 1,440 2,151,797,451 100.00

Substantial Security Holders as at 20 March 2020
The Company’s register of substantial security holders, prepared in accordance with section 35F of the
Securities Markets Act 1988 disclosed the following information.
Name Class of Shares No Shares % Held
T.D. Brankin & M.J. Kirwin Lay Ordinary 11,103,804,210 51.30

Directors’ Security Holdings including beneficial interests as at xxx 2020

Name No Shares % Held
T.D. Brankin Director 1,103,894,210 51.30
S. Underwood Director 72,089,798 3.35
M.D. Priest Director 26,836,315 1.25
H. Down Director 500,000 0.00
The directors did not hold any shares in the capacity of non-beneficiaries or associates.

36
Particulars of Directors’ Share Transactions in Promisia Integrative Limited
Dealing in Securities
The following table shows transactions recorded in respect of those securities during the year 1
January 2019 to 31 December 2019.
Director Date of transaction No of shares
purchased/(sold)
(Proceeds)
cost $
000
T.D. Brankin – Allotment 12 December 2019 250,000 $250,000
M. D. Priest – Off market transfer 7 February 2019 (4,000) $(4,000)

Share Transactions and Holdings
The share transactions effected by various directors are recorded in the Interests Register as set out
above and their holdings are shown on page 36.
Directors’ Remuneration and Other Benefits
The names of the directors of the Company at 31 December 2019 and the details of their remuneration
and the value of other benefits received for services to Promisia Integrative Limited for the year ended
on that date are:
Director Nature of Remuneration
S. Underwood $49,000 Director’s fee
M.D. Priest $17,000 Director’s fee
T.D. Brankin $17,000 Director’s fee
H. Down $17,000 Director’s fee
Employee Remuneration
There was only one employee, or former employee, who received remuneration and other benefits
valued at or exceeding $100,000 during the year to 31 December 2019, that being in the range of
$200,000 to $210,000.
Entries in the Interests Register
The Company has an Interests Register which records various disclosures as required by the
Companies Act 1993 and in accordance with good governance practice.
Other Directorships or Trusteeships
The following represents the interests of directors in other companies or trustees of organisations as
disclosed to the Company and entered into the Interests Register. The designation ** indicates the
director also holds an equity interest in the company.
Stephen Underwood
Promisia Integrative Limited – Group, Central Nominees Limited**, Central Securities Limited**,
Insolvency Associates Limited, Normandy Holdings Limited**, Panama Direct Limited**,Raurimu
Nominees Limited, Renouf Corporation Limited**, Tuff Lite Limited, Benefit Arthritis Limited.

37
Duncan Priest
Promisia Integrative Limited - Group, Trans- Tasman Resources Limited**.
Thomas Brankin
Promisia Integrative Limited – Group, Aldwins House Limited**, Eileen Mary Age Care Limited**,
Eileen Mary Holdings Limited**, Eileen Mary Age Care Property Limited**, i.Agri Limited**, Nelson
Street Resthome Limited**, OTB Property Limited**, Ranfurly Manor Limited**, Ranfurly Manor
Holdings Limited**, Ranfurly Manor No.1 Limited**, Design Care Group Limited**, Benefit Arthritis
Limited.*
Helen Down
Promisia Integrative Limited - Group, Advisory Boards New Zealand Limited**, Synthesis Marketing
Limited**. Technology Valley Limited.
Auditors’ Remuneration
Audit fees of $25,000 (2018: $27,000) are payable to the auditors for the audit of the statutory
financial statements only.
Donations
There were no donations made during the year ended 31 December 2019 (2018: $nil) by the Company
or any if its subsidiaries.
Information Used by Directors
There were no notices from Directors of the Group or any of its subsidiaries requesting to use
company information received in their capacity as a director which would not otherwise have been
available to them.

Takeovers Panel Disclosures
The following information is required to be included in the 2019 Annual Report of the company as a
condition of an Exemption Notice, Takeovers Code (Promisia Integrative Limited) Exemption Notice
2018 (Exemption Notice), issued pursuant to section 45 of the Takeovers Act 1993, by the Takeovers
Panel.
The Exemption Notice was issued by the Takeovers Panel on 29 November 2018.
Annual Report Requirements
1. Share Put Option
At a meeting of shareholders held on 4 December 2018 (Meeting) shareholders approved a resolution
authorising Thomas David Brankin and Michael John Kirwan Lay as trustees of the Brankin Family
Interest Trust (Brankin Trust) to acquire up to 39,027,368 shares from Mr G R Wells and Wells
Investments Ltd (Wells) under a put option agreement (Put Option) between the parties. Mr. Brankin
is a director of the company. The Put Option agreement had two exercise dates when Wells could
require Brankin Trust, to acquire the said shares. The two exercise dates are 30 January 2019 (at
$0.006 per share) and 30 September 2020 (at $0.009 per share).
Wells did not exercise the Put Option on 30 January 2019.
2. Summary of terms and conditions of the Exemption Notice

38
The Exemption Notice provided exemptions for:

a) the Brankin Trust from rule 7(c) of the Takeovers Code in respect of any increase in its voting
control resulting from its acquisition of voting securities under the Put Option; and
b) the company from rule 15(b) of the Takeovers Code, but only to the extent that the rule
requires the notice of meeting to contain, or be accompanied by, particulars of voting
securities to be acquired under the Put Option.

The exemptions were granted on various conditions, including that:

a) this annual report includes these disclosures.
b) information regarding the Exemption Notice and any 1% movements in the voting securities
held by the Brankin Trust are disclosed on the company website (see www.promisia.com).
c) the notice of Meeting contained certain disclosures and information. The Notice of Meeting
was released to the market on 16 November 2018 and can be viewed on the NZX website at
www.nzx.com.

3. Voting Securities of Brankin Trust
As at 31 December 2019 (the Calculation Date) the Company had 2,151,797,451 ordinary shares on
issue and the company had no voting securities on issue other than its ordinary shares.

As at the Calculation Date the Brankin Trust holdings of voting securities are disclosed as follows:

Number of voting securities acquired by the
Brankin Trust under the Put Option:
Nil.
Number of voting securities on issue that are
held or controlled by the Brankin Trust and the
percentage of all voting securities on issue that
that number represents:
1,103,804,210 ordinary shares are held or
controlled by Brankin Trust representing 51.3%
of all ordinary shares on issue.
The aggregate of the percentages of all voting
securities on issue that are held or controlled by
the Brankin Trust and their associates:
51.3%
The maximum percentage of all voting securities
that could be held or controlled by the Brankin
Trust if they acquire all shares under the Put
Option:
53.1%*
The maximum aggregate of the percentages of
all voting securities that could be held or
controlled by the Brankin Trust and its
associates if they acquire the approved
maximum number of voting securities under the
Put Option:
53.1%*

* The assumptions on which these percentages are based are that:

a) the Brankin Trust acquires all of the voting securities that are subject to the Put Option.
b) from the Calculation Date until all voting securities are acquired under the Put Option the
company does not issue any other voting securities.
c) the Brankin Trust does not dispose of or acquire any voting securities in the Company prior to
all of the voting securities being acquired under the Put Option.

39
CORPORATE DIRECTORY AND OTHER INFORMATION

Registered office and address for service
Level 5, 22 Panama Street
Wellington 6011
P O Box 25-396
Wellington 6146

Telephone: +64 4 4995563
Mobile: +64 22 0430634
Facsimile: +64 4 8318688

Email: accounts@promisia.com

Website: http://arthrem.co.nz/ or
http://promisia.com/

Directors
Stephen Underwood, Chairman
Duncan Priest
Thomas Brankin
Helen Down

Auditor
William Buck Audit (NZ) Limited
Level 4, 21 Queen Street
Auckland 1010

Share Registrar
Link Market Services
Level 7, Zurich House
21 Queen Street
P O Box 91976
Auckland 1142

Telephone: +64 9 375 5998
Facsimile: +64 9 375 5990
Email: enquiries@linkmarketservices.co.nz

Bankers
Kiwibank

Solicitors
Duncan Cotterill
Chartered Accountants House
Level 2, 50 Customhouse Quay
Wellington 6011







Company publications
The Company seeks to inform investors regarding
its business operations through issuing an Annual
Report, an Interim Report and Newsletters as is
appropriate.

Financial Calendar
Half year results announced August
Half year report September
End of financial year 31 December
Annual results announced February
Annual report March

Enquiries
Shareholders with enquiries about transactions,
change of address or dividend payments should
contact Link Market Services on +64 9 375 5998
or by email on
enquiries@linkmarketservices.co.nz .
Other questions may be directed to the Company
at its registered address.

Stock Exchange
The Company’s shares trade on the New Zealand
Exchange under the code PIL. The minimum
parcel on the NZX is 50 shares.