Annual Report 2014

All of us deeply feel the loss of our

friend and colleague, Professor Rob
Jansen, who provided the inspiration and
capability for Genea to be a world leader
in fertility and to help couples realise their
dream of having a healthy baby.
Rowan Ross AM
Contents

Tribute to Professor Robert Paul Siebrand Jansen 3

Chairmans Report 6
Board Members 8
2014 Group Result Summary 10
CEOs Report 11
Genea Divisional Reports 16
Corporate Governance 32
Our Values 42
Financial Report 44
Company History 112
Stages Of Embryo Development 114
Glossary Of Biotechnical Terms 115
Locations And Contacts 117

Genea Limited Annual Report 2014

2Genea
Professor Robert Paul Siebrand Jansen
1946 - 2014
On the night of Friday 11 July 2014, one of Geneas Prof Jansen was a college examiner, Chairman of the
guiding lights went out. After more than 35 years at college subspecialisation committee and a consultant
the forefront of reproductive medicine and genetics, to the NSW Law Reform Commission. He was the
Professor Robert Paul Siebrand Jansen died of Multiple President of the 11th World Congress on IVF and
Myeloma during a final holiday to Europe to indulge his Human Reproductive Genetics in Sydney in 1999,
twin passions travel and Genea. he was on the editorial board of two international
journals, he was a referee for 15 journals and he had an
In the words of his friend Dr Robert Lyneham, Prof
extensive involvement with the NHMRC.
Jansen was an inspiration of the likes of which this
speciality may never see again. During his career, Prof Jansen gave over 120
presentations as an invited speaker at international and
Every generation of doctors produces leaders that
national meetings on a vast array of subjects and in
are so inspirational, they not only change the lives
2012 he was honoured with membership of the Order of
of their own patients by their knowledge and care,
Australia for services to medical research and education.
they influence others to change direction and strive
for uncompromising excellence like them. Such is But most importantly to Sydney IVF and Genea, Prof
their understanding of the science of medicine, the Jansen was our mentor and guiding light.
compassion of medicine, the ethics of medicine, so
His vision and leadership motivated the team at Genea
broad is their intellectual creativity and vision, they
to make breakthrough developments in the culture
literally change how medicine is practised.
and incubation of embryos as well as the first true
An internationally acclaimed medical researcher who integration of IVF and genetics.
established Genea as Sydney IVF almost 30 years ago
Genea CEO Dr Tomas Stojanov remembered Prof
in 1985, Prof Jansen never lost his fascination for the
Jansen as a brilliant human being.
physiology of reproduction.
Without Prof Jansens visionary and entrepreneurial
And he never exhausted his desire to share what he had
pursuit of innovation and cutting edge medicine, there
learnt nor bored of writing and presenting on the topic.
would be no Genea and no opportunity to help start and
A prolific writer, Rob authored one book, edited three grow the families of the thousands of couples we see
more and wrote 31 chapters in books edited by each and every year.
others. He was the principal or instigating author in
Born in The Hague on 25 October 1946, to parents who
approximately 150 scientific publications and co-author
had been incarcerated in Singapore and Java during
in many, many others.
World War II, Prof Jansen grew up at Newport, north of
He also authored 25 papers on ethics and reproduction Sydney after his family moved to Australia seeking a
and six or more on the mitochondrial genome. better life.
His contributions to the discipline of genetics and
reproductive medicine were not limited to the written
word.

Genea Limited Annual Report 2014 3

Professor Robert Paul Siebrand Jansen
1946 - 2014
Graduating as Dux of Narrabeen Boys High School
in 1963, Prof Jansen embarked upon a remarkable
life long journey of self education and research. He
completed a Bachelor of Medical Science with first
class honours at Sydney University in 1968, then
his medical degree (MB. BS) in 1970. He became a
Member (later Fellow) of the Royal Australasian College
of Physicians in 1974 and then became a Fellow of the
Royal Australian College of Obstetrics and Gynaecology
(RACOG, later RANZCOG) in 1980.
During 1979 and 1980, Prof Jansen lived and
studied at the University of Texas, San Antonio as
Associate Professor in the Department of Obstetrics
& Gynaecology on Royal Prince Alfreds Chenhall
Fellowship. His research focused on the physiology of
the fallopian tube of the estrous rabbit and the macaque
monkey and led to his being awarded a Doctorate of
Medicine from the University of Sydney in 1987 for his
thesis The fallopian tubes reproductive province.
Dr Lyneham explained that those two years in San
Antonio were a vital key to Prof Jansens future career in
reproductive medicine.
What these two years also did was to expose Rob to
American doctors specialising in infertility alone. This
gave him the confidence to start his own practice in
Parramatta and later in Macquarie Street on his return to
Sydney.
In 1983, Prof Jansen travelled to the 3rd World IVF
Congress in Helsinki and heard corridor talk about an
ultrasound technique that could be used to reach ovarian
follicles covered with scar tissue and inaccessible at
laparoscopy - the then sole technique for egg retrievals.
While Prof Jansens practice was well established back
in Sydney, the reality was that treatments for infertility
were still largely limited, despite the birth of the first IVF
baby in London four and a half years before.
4Genea
However, there was a plan in play and Prof Jansen
approached Dr John Jock Anderson with the
information he had gleaned in Helsinki and together
they came up with a vision for a more patient-friendly
IVF treatment which could be conducted in day surgery.
Combining their expertise and knowledge, the pair
designed and produced the worlds first transvaginal
ultrasound probe, dramatically revolutionising oocyte
collection and the overall field of assisted reproduction
as well as paving the way for the birth of Sydney IVF in
February 1986.
Sydney IVF started with one scientist, one nurse and
five doctors and the first IVF egg retrieval, using the
transvaginal transducer was conducted on a patient
- Marilyn - at King George V Hospital in Sydney. The
fertility clinics first babies were born before the end of
1986, from pregnancies achieved in that first month of
operation.
Prof Jansen instilled in that infant company a set of
principles still in place today.
His very first rule for the whole team was the one he
believed was the most important and it was introduced
almost on day one. Essentially, he told the team that
Sydney IVF would not be a place where you faced the
sack for making a mistake but you would most certainly
risk dismissal if you tried to cover it up. Integrity and
accountability were essential.
Secondly, the level of medical care given to our
patients had to be the best. Prof Jansen led the way
by becoming the first person in Australia, in 1991, to
achieve Certification in Reproductive Endocrinology
and Infertility (CREI) - the gold standard subspecialist
degree - with the RACOG (now RANZCOG).
This superior level of medical care was also extended to As Genea Fertility Specialist Dr Geoffrey Reid explained,
the public sector from the beginning there has been these ground breaking developments represented both
an IVF unit at RPA for public patients, with the same Prof Jansens vision and his ability to gather the best
pregnancy rate. Prof Jansen was always proud of this possible people to work at Sydney IVF and Genea.
Sydney IVF/Genea public hospital service.
This was his modus operandi, as he offered guidance,
Thirdly, the general level of care had to be personal and encouragement and mentorship to innumerable doctors
genuine, from accounts to counselling. This strategic and scientists, Dr Reid said.
essence was well captured in 2005 with a successful
A considered and caring teacher as well as a physician,
new brand look and the tagline: no better chance, no
researcher and scientist, Prof Jansen was an inspiration,
greater care, Dr Lyneham said.
a mentor, a treasured colleague and a friend to all.
Above all, science was the key and the driving force.
He was also a loving husband, father and grandfather
Rob never wavered from his view that excellence in and the thoughts of all of us at Genea are with Diana,
IVF was predicated on excellence in the science of Wendy, Alice, Peter and Christopher.
IVF and this excellence demanded a large investment
Prof Jansen gave his last public address at the
in research, unequalled in Australia. It was, and is, this
Australian Gynaecological Endoscopy Society (AGES)
investment that sets Genea apart from its competitors
Annual General Meeting in March 2014 from his
and has been responsible for its world-leading success
wheelchair. He spoke about the history and future of Ross AM
Rowan
rates, Dr Lyneham said.
assisted reproduction, and his address was received
These are just a few of the many, many world first with a standing ovation.
developments in IVF and fertility science developed at
Prof Jansens legacy of innovation, commitment to
Sydney IVF and Genea:
excellence, his dedication to the best patient care and
In 1991, work began on Project M91, a culture medium unrelenting enthusiasm lives on at Genea - and the
that replicated conditions within the human fallopian companys accredited doctors and staff are determined
tube. Today, more than 600 clinics around the world to maintain the vision and culture that he instilled in all
nurture embryos using culture media developed by of us.
Genea.
In 1996, Sydney IVF began providing diagnostic
Thank you to Dr Robert Lyneham and Dr Geoffrey Reid
genetic services and was at the forefront in Australia in
for their contributions to this tribute.
developing genetic testing of embryos preimplantation
genetic diagnosis or PGD. Sydney IVF developed the
method of PGD at the blastocyst (Day 5) stage of
embryo development, a technique now recognized
internationally as the gold standard of this form of IVF
treatment.
In 2004, Sydney IVF produced Australias first human
embryonic stem cells from just the second donated
embryo thawed.

Genea Limited Annual Report 2014 5

Chairmans
Report
Soon after financial year end we were immensely
saddened by the loss of Professor Rob Jansen, the
Companys founder, former Chairman and Chief Executive
Officer. Genea today is the product of Robs vision,
medical and scientific abilities, ethical values, business
acumen, energy and drive. We owe him a huge debt of
gratitude. He not only created the Company but was
primarily responsible for shaping its destiny and the
impact it has had on the community. His business model
of improving success rates for live healthy births by
investing prudently and successfully in related research
and development has underwritten both the clinical and
business success of Genea. A brilliant doctor specialising
in reproductive medicine, Rob was also at the forefront of
the associated science and the ethical issues it entailed.
By combining these talents with his business skills, he
embedded in Genea the vision, mission and values which
are the Companys raison detre. Its success is his legacy.
With a 30.3% shareholding in Genea, the Jansen family
is the Companys largest shareholder and at the time
of his death Rob was a non executive director of the
Company. Your directors believe it is in the Companys
best interests for the Jansen family to be represented
on the board and accordingly issued an invitation to
Mrs Diana Jansen to join the board as a non executive
director. We are delighted that Mrs Jansen has accepted
our invitation and we look forward to the contribution
she is well qualified to make to the good governance of
Genea. In accordance with the Companys Constitution
Mrs Jansen will stand for re-election at the forthcoming
Annual General Meeting.
Geneas financial performance in FY 2014 was in line
with expectations. Revenue of $76.3 million was up
by 4.0% and net profit after tax of $4.9 million was
the same as the previous year. The result reflected the
significant investment being made to transform Genea
from a domestically focussed clinic based operation into
an international IVF products and service business.
6
Genea Fertility benefitted from a 5.6% increase
in oocyte pick-ups (OPUs) and a price increase
implemented in September 2013, resulting in an 8%
increase in revenue to $75.4 million. Notwithstanding
intense competition from our larger, ASX listed full
service rivals and from low cost providers, Genea
maintained market share in NSW and Western Australia
while limiting losses in the ACT following the departure
of a key specialist. An important initiative implemented
during the year was a new doctor engagement model
designed to better align the interests and loyalty of
our doctors. So far this initiative has proven successful
with all our clinicians being retained following its
implementation.
Sound progress was made during the year towards
developing and commercialising the instrumentation
projects, Gavi and Geri, which are fundamental to the
future of Genea Biomedx. A new facility was established
at Sandwich, Kent, UK to be the European base and sales
office for Genea Biomedx products including the Gems
media suite. Planned investment in the Division resulted
in an EBIT operations loss of $8.1 million for the year.
We anticipate using the instrumentation products in our
clinics this calendar year, with external sales being made
in the second quarter of calendar 2015.
Genea Biocells made steady progress during the year,
refining its strategy which includes commercialising
existing products and services and developing a
stem-cell based discovery platform. An EBIT operations
loss of $2.5 million was recorded reflecting this
development and commercialisation phase. The Division
has now established a dedicated business development
team which will greatly assist in growing the customer
base for its differentiated stem cell lines.
Chairmans Report
The combination of reduced operating cash flows and I would like to acknowledge the contribution of our
continuing development expenditure in Genea Biomedx Chief Executive Officer, Dr Tomas Stojanov, and his
and Genea Biocells resulted in net cash decreasing senior management team during the year and thank
by $4.6 million. Cash balances stood at $0.8 million our doctors, scientists and staff for their commitment. I
at year end after drawing down $5.4 million of a new would also like to thank my board colleagues for their
banking facility arranged with the Commonwealth Bank support. All of us deeply feel the loss of our friend
of Australia. The unutilised amount of this facility at year and colleague, Professor Rob Jansen, who provided
end was $8.1 million with a further amount of GBP1.4 the inspiration and capability for Genea to be a world
million also undrawn. Cash flow projections indicate that leader in fertility and to help couples realise their dream
the Company is in a sound financial position to continue of having a healthy baby. Your board believes it is of
to fund forecast capital expenditure and operating paramount importance that his vision, mission and
requirements of these new businesses prior to sales of values remain firmly embedded in the Company.
their products ramping up.
An interim dividend of 37 cents per share, unfranked, was
Rowan Ross AM
paid during the year. Your directors have resolved to pay a
final dividend of 54 cents, partially franked, in respect of
FY 2014, bringing total dividends for the year to 91 cents
per share ($1.22 per share in FY 2013). The Company
Rowan Ross AM
has limited franking credits available due to the effect of
concessional tax treatment of research and development
(R&D) expenditure on the corporate tax rate.
The Companys shares sold in a range of $49.50 to
$55.50 during the year with most recent sales around
$50.00. With our two largest competitors, Virtus Limited
and Monash IVF Limited, now listed on the ASX it is
possible to benchmark our Genea Fertility operations
and to obtain market based valuation parameters to
assist in assessing the worth of Genea shares.
As advised to shareholders in the Shareholder Update
for the year ended 30 June 2014, the Company is
budgeting for Net Profit After Tax to remain relatively
stable in FY 2015 at $4.0-5.5 million on higher revenues
of $83-88 million. This subdued profit level continues
to reflect the start-up phase of the Genea Biomedx
and Genea Biocells divisions. We remain confident
that the significant investment we have made in these
divisions will reward shareholders over the medium term,
and ensure the Companys future in an increasingly
competitive market.

Genea Limited Annual Report 2014 7

Board Members
30 June 2014

Left to right
(Inset)
Professor Robert Jansen AM
Non-Executive Director
Mr Euan Pizzey
Non-Executive Director
Mr David Smithers AM
Non-Executive Director
Mr Rowan Ross AM
Chairman
Dr Robert Woolcott
Non-Executive Director
Dr Tomas Stojanov
Chief Executive Officer

8
 9
2014 Group Result Summary
Group Revenue

76.3
Basic EPS
$
million 173 cents

Final dividend declared

$2.8 million

54
IVF revenues were up 8%

cents

Group profit after tax

$
4.9 million

Group cash generation

$0.3 million

$
(4.6) million

10 2014 Group Result Summary

From the CEO
Everybody in the world of reproductive science and
medicine, and a great many outside of it, knows the Tomas Stojanov CEO
name Professor Robert Jansen or, at the very least, the
company he created - Sydney IVF which developed and
grew into Genea.
Prof Jansen was a leading clinician and academic in
the field of infertility treatment, he was an inspirational
entrepreneur and business leader and he was the
visionary founder and managing director of Sydney IVF
and Genea for 25 years.
Through Sydney IVF and Genea, he set the gold
standard for the IVF industry and was often many, many
years ahead of the pack.
Prof Jansen was publishing on blastocyst culture
10 years before it became mainstream, Sydney IVF
led work on the holy grail of embryo culture through
development of its own unique and proprietary culture
medium. It is still the only fertility clinic that creates and
produces its own culture medium.
He was preaching the importance of Preimplantation
Genetic Diagnosis (PGD) in mainstream IVF clinics a
decade before it became fashionable, advocating (and
doing) blastocyst biopsy and leveraging the value of
our blastocyst culture well ahead of his competitors. Innovation and growth
He also recognised and instigated the use of embryo
karyotyping as the best method to select the embryo Sydney IVFs and now Geneas commitment to regularly
most likely to succeed in creating a healthy pregnancy. dedicate 10% of revenue to R&D has laid the foundation
for your companys logical and effective diversification
On the care side of the equation, Prof Jansen into an existing industry related range of products,
understood the need to take this world leading fertility technologies and services.
science to the patients by opening regional fertility The strategy and structure of the modern day Genea
clinics, including the first in New South Wales in the is unique here in Australia and internationally and the
north west centre of Orange. expansion of our technological and R&D arms, while
Despite this deep involvement in the detail of fertility remaining integrated with our clinical services, is critical
science and patient care, or perhaps because of it, for our continued growth and success.
Prof Jansen was also able to gain a wider perspective
on our maturing industry and recognise the need for
diversification to achieve continuous growth.

Genea Limited Annual Report 2014 11

From the CEO (cont.)
Above and beyond all of this though, Prof Jansens most
important achievement was the culture of scientific
excellence and innovation he instilled at Genea. It lasts
to this day and combined with the talented and skilled
team Prof Jansen built up over his time at Genea, there
is a focused and passionate commitment from the
Board down that this legacy of scientific excellence and
innovation will be carried and protected into the future by
all of us.
Current market conditions
With the arrival of private equity ownership of Geneas
main competitors and their subsequent floating on the ASX,
Geneas fertility business is now operating in a saturated
market characterised by the newly listed competitors
with ambitious commercial goals.
The year just past has delivered new competition in the
form of low cost clinics and clinics offering rudimentary
services at the Medicare only rate, all against the
backdrop of an industry that is not fully transparent
about outcomes. Some market players claim success
on the basis of comparatively strong clinical pregnancy
rates when we all know that the only measure of
success important to our patients is taking home a
healthy baby. The lack of transparency and a consistent
measure in this area allows lower performing clinics
to pick and choose when selecting a metric to show
success, potentially hiding their true outcomes.
Medicare contributions to fertility treatment are
important to ensure accessibility for all facets of the
population, not just the more wealthy socio-economic
segment. However, the downside of the rebate and
services designed to be delivered with no out-of-pocket
costs is that they lower normal market economy
pressures on poor performance.
Under Medicare, the fact that someone else is paying
for the IVF treatment removes a great deal of the impetus
for excellence. Its far too easy, at $0 to $500 a treatment,
to simply say: we can afford to have another cycle.
12
Notwithstanding the difficult and very competitive
environment that prevailed during the financial year,
Genea was still able to deliver impressive sales revenue
growth from its Fertility business of $75.4 million (up
8% on FY2013) and an EBIT of $14.2 million (up 6.5%
on FY2013). The Fertility business EBIT was offset
by the planned new business start-up EBIT losses of
the Biomedx business of $8.1 million and the Biocells
business of $2.5 million.
Future growth dependent on measured
strategic diversification
The difficult business factors of FY2014 could be
interpreted as market disrupting, but in fact they are a
validation of Geneas diversification strategy, in place
since 2010 and refined and expanded each year since.
We have to accept that the industry has changed forever
and the main goal of some of our competitors is to
maximise profit not to maximise the long term chances of
patients to achieve a healthy pregnancy. We have to adapt!
And most importantly we have to make sure that everybody
relevant knows who we are and why we are by far the best
value for money when you need infertility treatment.
Your company is focused on continuing to deliver our
premium, full cost model of fertility treatment with a
service offering that stretches from pre-conception
through conception to post clinical pregnancy testing
and care. Our world leading status in PGD, genetic
testing and embryo vitrification already provides patients
with numerous options to start and grow their families
and the coming year will see an expansion of these
services to help a wider range of patients.
Our new technologies and methodologies are rapidly
enabling the reality of entire families being developed
from one stimulated cycle (oocyte pick-up or OPU).
Multiple healthy embryos are created, one is transferred
leading to pregnancy and others are vitrified for later
transfer on a natural cycle. Essentially F = OPU1 (one
family equals one OPU). Continued development of this
approach to fertility treatment will be cost effective for
patients and for society.
From the CEO
However, the reality is that the volume of OPUs remains
Geneas main business driver for the Fertility business
and activity needs to be focused on OPU growth while
still delivering the best clinical outcomes possible.
Genea Biomedx
Our expertise in the processes and procedures
undertaken to continue to improve the success of each
form of assisted reproduction is translated into our
IVF technologies company, Genea Biomedx. Genea
Biomedx is the second pillar of our three pronged
business model. The relationship between Genea
Fertility and Genea Biomedx is symbiotic and our main
competitive advantage - access to the Genea Embryo
Medium Suite, or Gems, has already greatly benefited
tens of thousands of our patients. We anticipate that late
in the 2014 calendar year, the benefits will also begin
to flow back to the Fertility business with the scheduled
introduction of instruments Geri (time lapse incubation)
and Gavi (automated vitrification) in our labs.
Geneas credentials as an IVF pioneer are
unquestionable. Your companys history of innovation
includes being the first:
IVF clinic in the world to develop and routinely conduct
blastocyst biopsy
IVF clinic in the world to develop a triple sequential,
ready-to-use embryo culture media system
Australian fertility clinic to introduce routine Day 5
embryo transfers
Australian fertility clinic to introduce routine single
embryo transfer
Australian fertility clinic to develop and routinely
replace the old slow freezing method for embryos and
eggs with a more efficient and successful vitrification
process
Australian fertility clinic to perform full chromosomal
analyses of an embryo by microarray CGH

Genea Biocells Australian fertility clinic to achieve a live birth following

egg vitrification
The third pillar in Geneas new diversified business
model is the creation of the Genea Biocells business. Australian Fertility Clinic to conceive and develop a
This business draws on your companys acknowledged benchtop incubator (the MINC)
expertise in cellular biology, genetics and stem cell Australian Fertility Clinic to develop a world leading
derivation. It also provides an important avenue for embryo transfer catheter. The Sydney IVF catheter
our PGD patients to donate their excess embryos to developed by Prof Jansen and Dr Anderson more than
research into finding a cure for any relevant genetic 20 years ago is still the most popular embryo transfer
condition impacting their family. catheter globally.
Geneas unique value proposition
The strength of Genea lies in the interaction between
its three core businesses - Genea Fertility, Genea
Biomedx and Genea Biocells. As an IVF technologies
business, we understand the IVF industry, IVF patients,
Fertility Specialists and Fertility Scientists because at
our core we are also an IVF clinic. The knowledge and
intelligence derived from these inseparable relationships
is invaluable and has provided the foundation for the
establishment of Genea Biomedx.

Genea Limited Annual Report 2014 13

From the CEO (cont.)
Growth and Expansion
Genea Biomedxs business strategy starts from
these innovations and focuses on the development,
manufacture, sale and distribution of existing and future
innovative and game changing fertility technologies.
Genea Biocells grew out of our expertise in cellular
biology and genetics and has developed into a
globally recognised stem cell company. As stem
cell-based disease models become common practice
in pharmaceutical drug development and the technique
of cell therapy is developed, Genea Biocells technology
platform means it is well positioned to play a key role in
both market segments.
Commercialisation of these technologies and Geneas
clinical and genetic expertise will be the key success
factor in our drive for geographical growth and
expansion.
The realities of the Australian IVF industry are that
currently it is a saturated market with price pressures
and a lack of recognition of the value of better
performing clinics to the Australian health system; all
of which validate and justify Geneas three pronged
business model as the best possible way to deliver
sustainable growth for your company.
14
Our People
The highly competitive market in which we operate
means that attracting and retaining talented employees
is a critical business success factor. We continue to
ensure Genea is an attractive place to work by listening
to our employees and hearing what they enjoy about
working for Genea and what can be improved. This
year we have made a number of enhancements to our
employee value proposition in the areas of Wellbeing
(through our Good for You programme) and Employee
Benefits in particular. Building the capability of our
employees continues to remain a core focus and during
the year we have developed an extensive programme
focused on our senior leaders. This forms a component
of our Talent Framework launched this year that
strategically drives capability development, employee
retention and key talent acquisition.
Conclusion
In conclusion, I would like to thank Geneas dedicated
executives and senior managers who work tirelessly
to ensure we remain world leaders. My thanks also to
you, our shareholders, for your enthusiasm, interest and
support which inspires me and all of the Genea team
to enshrine Prof Jansens vision, values and ground
breaking scientific achievements and to keep pushing to
create innovative instruments and treatments and deliver
better outcomes for our patients.
Tomas Stojanov
From the CEO
Genea Limited Annual Report 2014 15
Genea Fertility
Highlights
40% Better Chance campaign launched successfully
Growth in both geographic reach and breadth of clinical services
In-house pathology services established
Innovative marketing initiatives launched to continue building brand awareness and capture market share
Development of the partnership with Superior ART to expand Geneas expertise across the Asian region

The foundations of our fertility business are our leading

success rates and the delivery of supportive patient care.
In the 2011 ANZARD Report*, an assessment of success
across all Australian and New Zealand clinics showed
the live birth rate per IVF attempt for women under 35
years of age ranged from 4.8% to 36.8%. In contrast to
this dramatic range, Genea consistently has results in the
highest quartile and, in the period covered by this report, Success
we delivered a 40% greater chance of success compared
to the average of all other clinics across Australia and
rates worth
New Zealand**. We believe its important for everyone screaming
considering fertility treatment to be aware of this point about.
of difference between clinics to help them make an
informed decision about where to seek treatment - that
is the clinic which will give them the best possible chance
of taking home a healthy baby. This data and Geneas
For more than 28 years, weve been dedicated to finding better ways to
40% better chance of success message formed the help couples realise their dream of having a baby. First as Sydney IVF, To nd out how we can
best help you, call our
now as Genea.
centrepiece to our advertising during FY 2014. Our commitment has created world leading advances in fertility,
Genea fertility experts.
1800 359 799
culminating in a 40% greater chance of taking home a baby when
genea.com.au/success
assisted by Genea, than the average of other clinics in Australia and
Month on month we consistently recorded patient New Zealand*. For those we help, thats the most valuable statistic of all.

feedback scores well above 90%, demonstrating that Everything we do at Genea is about improving your chance of success.
Its why our expert Fertility Specialists, in collaboration with our holistic

we met patient expectations and our patients were practitioners, consider all aspects of your fertility to create the best
treatment plan for you. Age, lifestyle and diet, as well as medical factors,
can all play a part.
satisfied with our services. These metrics demonstrate our And well continue to lead the way in researching new and better

leadership in the field. methods of further improving chances, such as our recent IVF innovation
in embryo culture media GemsTM - the vital solutions that nurture egg,
sperm and embryo development.
Our people, technology and unrivalled expertise together create a
Continued success greater chance for everyone we assist.

Geneas fertility laboratories continued to provide * 40% greater than the average of other clinics combined, according to analysis of the latest available data (2011)
released August 2013 from the Australian and New Zealand Reproduction Database (ANZARD) and based on live

Genea clinicians and patients with leading outcomes. A births per embryo transfer.

comparison of the most recent available national data Genea - Latte ad - Sept2014.indd 1 23/09/2014 5:03:19 PM

(from the 2011 ANZARD Report) to Geneas preliminary

results from 2012, shows our clinics continue to rank in
the top quartile.
16 Genea Fertility
Genea Limited Annual Report 2014 17
Genea Fertility (cont.)
A review of Geneas results across IVF/ICSI, frozen Over the past 12 months we have implemented
embryo transfers and PGD over the past 12 months automated technologies in Genea fertility laboratories
shows that Genea laboratories have continued to perform, with the aim of improving productivity. Our embryology
with particularly strong improvements in the frozen labs now have a fully automated system for the
embryo transfer and PGD outcomes (Table 1). production of embryo culture dishes, a system which has
resulted in a reduction of staff required to undertake this
Table 1: Geneas fetal heart pregnancy data work. In collaboration with the IT Department, the teams
(July 2013-June 2014) across all fertility laboratories are working on an auditable
witnessing system that will allow all our laboratories to
July 2013 improve staffing allocations and patient security. It is
- June 2014 envisaged that the system will be rolled out to all Genea
<38 >=38 clinics by the end of 2014.
Fresh No. ETs 1,513 1,277 Geneas biochemistry laboratory expanded its
Avg No. ETd 1.08 1.21 geographical reach during the year and the advancement
Avg age 33.62 41.21 of next generation sequencing technology led to the
introduction of new clinical services that were well
% Clinical preg 39.9% 19.0% received by referring clinicians and their patients.
% Imp rate 38.4% 16.2%
Helping patients recognise the Genea difference
% Mult preg 4.0% 3.7%
Over the past year and a half, one of our primary projects
% cycles 61.5% 61.9%
within Genea Fertility has been the establishment and
represented
refinement of a strategy to manage new patients seeking
FET No. ETs 1,281 455 information and support from us. We know that patients
Avg No. ETd 1.02 1.05 can find it a big step to move from trying to conceive
Avg age 33.08 40.09 naturally, to the recognition they may have a problem
conceiving and then on to undertaking fertility treatment.
% Clinical preg 44.4% 26.8% By closely supporting these patients on each step of
% Imp rate 44.8% 26.4% their fertility journey, we ensure they get to see a Genea
% Mult preg 3.3% 3.3% Fertility Specialist in a timely fashion.
% cycles 65.2% 65.9% Attracting patients to Genea and Geneas Fertility
represented Specialists is integral to the business model. Again,
PGD No. ETs 295 118 these activities faced a challenging environment with
heightened activity in all forms of media from both of our
Avg No. ETd 1.02 1.01 main competitors who are now listed on the ASX.
Avg age 33.04 40.20
Exploring new and more effective communication
% Clinical preg 51.9% 43.2% channels is no longer an additional expense or luxury
% Imp rate 52.5% 42.9% employed by large IVF clinics but a fundamental necessity
% Mult preg 3.3% 0.0% of survival for every clinic large or small, low cost or full
service. It is especially new patients, undergoing their
first IVF cycle, who cannot clearly differentiate between

18 Genea Fertility

IVF clinics. That said, Geneas marketing activities across
the financial year successfully generated almost 3,000
opportunities through the integrated marketing channels
of direct, digital, medical and public relations.
Ours is a business characterised by a surprising slowness
to act on the part of consumers who are daunted by
admitting they are infertile and need to seek help. During
the year, patient prospect to OPU conversion plateaued
at approximately 22% with an average 6 to 10 month lag,
however, some opportunities generated by the embryo
culture media publicity in February 2013 were still trickling
through 18 months later.
On Christmas Eve 2013, Genea launched a new website
for the Fertility business. Filled with new, relevant content
and operating on a responsive and intelligent platform,
the new website has shown a 66% increase year on year
in the percentage of traffic visiting Fertility Specialist and
Genea clinic pages, leading to 644 appointments made
through the website in the six months to the end of June
2014. Furthermore, page engagement has significantly
increased by a magnitude of three-fold on average
and we expect this will continue to generate further new
opportunities and OPUs. We will seek to improve our
online presence through continual website optimisation.
Public relations activity throughout the year eclipsed our
major competitor IVF Australia with 70 articles, interviews
and television news segments about Genea, reaching
an audience of 12.7 million (compared to IVF Australias
audience of approximately 11 million).
A partnership struck with Australias leading womens
network, Business Chicks saw Geneas brand and key
messages delivered directly to more than 33,000 people
(predominantly women) in our target market across the
country. Genea has exclusive partnership rights at events
with regular audiences of 800-1,500 people learning
about Genea alongside the featured high profile and
successful women which has already included Olympic
Gold Medallist Alisa Camplin, novelist Kathy Lette,
Net-a-Porters Megan Quinn and global publishing icon
Arianna Huffington.
Genea Limited Annual Report 2014
For people seeking fertility treatment, Genea is very
well known for our expertise and success in treating the
difficult cases and the hard to get pregnant patients.
To capitalise on this perception, we launched the Switch
campaign which encouraged patients of other NSW and
ACT fertility clinics to switch to Genea for treatment.
Strong in the digital and outdoor space, the Switch
campaign went into market in the month of June and
generated a great response. This high profile, highly
targeted and market leading campaign delivered 146
potential patients to the business.
Shortly after the end of FY 2014, Genea launched The
Australian Fertility Census.
An Australian - and to all indications, a World - first, the
Census was an exciting new marketing initiative to build
Geneas brand and, at the same time, build a body of
information about exactly what Australia thinks and knows
about all things related to sex, baby making and kids.
The enlightening and interesting findings of the Census
were released on 1 September 2014 to mark the
beginning of Spring and Fertility Awareness Week.
Operational efficiency initiatives to enhance
productivity
At the commencement of FY 2014, we committed
to implementing a program of operational efficiency
initiatives in order to streamline processes, improve our
service offering and enhance the profitability of the
Fertility business. Areas of focus included:
Patient on-boarding into Genea: all patient education
and medical consenting processes were redeveloped
to streamline our interactions with patients and reduce
the administrative burden for our clinics.
Morning clinic: a patient queuing and workforce
management system was introduced to our Kent
Street morning clinic where patients present for
blood testing, ultrasounds, to collect drugs and have
questions answered. The new system gives patients
the option to check in immediately using their
19
 Genea Fertility (cont.)
Genea card at kiosks in our reception when they arrive
or even before we open in the morning using their
smart phones. The system permits us to direct patients
efficiently to the appropriately qualified member of
staff, track the use of the facility, monitor turnaround
times of staff performing a task and streamlines
activity overall. The system has decreased our patient
wait time by approximately 80%; improved the patient
experience and allowed us to more efficiently allocate
our staff.
A number of improvements around our patient
payment processes to significantly reduce the
manual steps our staff perform to collect fees were
introduced.
Centralising booking lines from across multiple clinic
locations for patient ease and to maximise the offering
of our various clinic locations.
Introduction of more standard clinical protocols
to streamline patient management and our staffs
interaction points with our Fertility Specialists.
With these initiatives in place, the Fertility division
successfully reached the targets set-out at the onset of
the FY 2014 to reduce personnel cost as a percentage of
revenue.
Forte building, Christchurch, New Zealand
20
Growth and extended geographic reach
Genea Fertilitys profitability is driven by the number of
stimulated cycles undertaken with the team committed
to growing total OPU volumes by capturing marketshare
where we have established clinics. We did this through
our marketing initiatives and brand awareness and also by
extending our geographic reach into markets where we
can successfully offer our services by opening new clinics
to provide a local, more convenient service for patients.
During FY 2014 we opened:
a clinic in Manly to better support current and new
patients on the Northern Beaches
a clinic in St Leonards to have a presence on the
North Shore - an area that has traditionally been IVF
Australia territory; providing patients with a strong
competitive alternative for treatment
a clinic joint venture with Oxford Womens Health in
Christchurch, New Zealand
Internationally during FY 2014:
Superior ART continued to grow rapidly in Thailand. It
is one of the leading providers of PGD for karyotyping
and genetic conditions. A new clinic was opened in
Udon Thani, and we have established consultancies in
Myanmar and Vietnam and offices in China.
Licensing of our IVF and PGD technology was
undertaken in the Czech and Slovak republics 10
years ago which deliver a stable revenue stream to our
Fertility business. Our European partner Sanatorium
Helios has established itself as an industry leader in
Europe, with a respectable live birth rate matching
results at our Kent Street facility. This model of
technology licensing and franchising is currently
underutilised in our view and we are actively testing
this model with our Thai partners throughout South
East Asia.
Genea Fertility
Most importantly, all international growth by Genea will be Expansion of the centralised specimen reception
undertaken with the preservation and successful export (CSR) function in Kent Street allowing Genea to
of our culture of innovation and scientific excellence, control all aspects of pathology sample logistics
ethical and risk management culture and transparency. (including everything from routine bloods testing to
molecular DNA samples) from sample collection
Growth in service and test volumes through to electronic delivery of results to Genea
In a saturated market, differentiation of Geneas science Fertility Specialists. The reach of the suite of Genea
and care is highly important. Some examples of new tests was expanded to the Liverpool, Canberra, RPAH
initiatives in the clinical arena include: and North West clinics during the FY 2014. The CSR
has triaged over 27,000 tests for Genea Fertility
Introduction of a PGD-Chromosomal analysis opt-in
Specialists, retaining 5,500 for in house testing and in
service aiming to provide the latest clinical options to
the process allowing us to both collect the associated
all patients. Our PGD service remains a key service
revenue and decrease the external costs to third party
differentiator and treatment cycles incorporating
pathology providers.
microarray chromosome analysis are producing very
strong results, even in the traditionally hard to get Non-Invasive Prenatal Screening program: in
pregnant groups (see Figure 4). late 2013 work commenced on implementing a
Non-Invasive Prenatal Screening program, with a
Figure 4: IVF/ICSI vs Chromosomal Analysis successful pilot study run in early 2014. Negotiations
were undertaken with a technology partner, one of
60%
the largest suppliers of this technology in the world,
to allow us to deliver the service from Australia - a
50%
move which means Genea will be one of the first
clinics in Australia to provide this technology for early
40% 44%
42.2% pregnancy management. The growth of this service is
expected to overtake current standard First Trimester
30%
Screening program over the next 12-18 months.
20% 24.3% Introduction of endocrinology testing into the
21.7%
19% Canberra clinic has been a great success. A
10% significant reduction has been achieved in service
3.9% delivery times to our Fertility Specialists, allowing
0% clinical discussions to take place earlier in the
IVF/ICSI embryos Embryos that have day which has a positive influence on patient
undergone chromosomal
analysis management. We have also delivered significant cost
% Fetal Heart
reductions by reducing the use of third party providers
of pathology services.
% Live Birth
% Clinical Miscarriage

Comparison of straight IVF/ICSI embryos with the superior testing delivered

by Chromosomal analysis to select the healthiest embryos for patients 38
years and over. IVF/ICSI data is for Day 5 or 6 fresh transfers only.

Genea Limited Annual Report 2014 21

Genea Fertility (cont.)
Genea Genescreen: During FY 2014 we launched
an advanced cystic fibrosis test and there has been
strong uptake by our Fertility Specialists and patients.
During October 2014 the next service, GeneScreen
Plus, will be launched offering testing for the most
common single gene disorders.
Genea Fertility revenue of $75.4 million was up $5.6
million on the prior year, mainly due to an increase in the
number of oocyte pick-ups (OPUs) performed.
In an increasingly price sensitive market, and under
intense competitive pressure from both our larger,
listed, full service rivals as well as low-cost providers,
we managed to maintain our market share in NSW
and Western Australia, while limiting losses in the ACT
following the departure of one of our key specialists.
Consistent with our stated aim of being a World Leading
Fertility company, as judged by our success rates and the
level and breadth of our services, all of our growth has
been achieved in the full price segment of the market
whereas, the growth among our competitors has been
achieved mainly in low cost IVF.
Overall, the Fertility business EBIT of $14.2 million was up
by $0.8 million on the prior year. The result was impacted
by the write off of goodwill of $1.3 million to recognise
the shift away from our traditional diagnostic offerings
towards new molecular-based technology services.
Adjusting for this one-off item EBIT would have been
$2.1 million higher than the prior year.
* Latest available data (2011) released August 2013 from the Australian and New Zealand Assisted Reproduction Database (ANZARD).
** Than the average of other clinics combined, according to analysis of the latest available data (2011) released August 2013 from the Australian and
New Zealand Assisted Reproduction Database (ANZARD) and based on live births per embryo transfer.
22
Community
Work on Geneas application to secure a Medicare rebate
for patients undergoing PGD was ongoing through the
year as it progressed through the government review
process.
The PGD Assistance Program continued through
generous ongoing donations, the support of a number of
Genea Fertility Specialists and the dedication of the PGD
Assistance Program Selection Committee comprising:
Mrs Dianne Petrie OAM, Ms Carolyn Shalhoub and Mr
Bruce Cutler. Genea is very proud of the continued
success of the Program and to assist couples who would
otherwise be unable to afford treatment. To date 21
babies have been born, there are 16 ongoing pregnancies
and 13 couples are still to complete treatment. The
Program was initially established by a generous donation
by Professor and Mrs Diana Jansen. There are already
11 couples who have been accepted for 2015, and Mrs
Jansen will continue to provide the main financial support
for this Program. We extend our heartfelt thanks to Mrs
Jansen and all who make this Program possible.
Genea Fertility
Genea Limited Annual Report 2014 23
 Genea Biomedx
Highlights
Secured European Commercial and Media Operations facility in Kent, UK. Refurbishment and operations
commissioning in progress, on time and on budget
Kent Street media production facility commissioned and operational, servicing all Genea clinics with Gems media
Gavi passed major development milestone by completing verification testing. Product has now transitioned to
pilot manufacture and final testing
Geri passed pre-verification and now commencing formal verification testing. Product in design transfer in
preparation for final testing

Genea Biomedx develops innovative high-technology
products designed to standardise and automate
laboratory processes to ensure consistency of high quality
outcomes.
Our objectives are to:
Develop and commercialise IVF laboratory
technologies for sale to the global ART market
Utilise these technologies within our Fertility business
to improve processes, reduce handling risk and
ultimately create a competitive advantage in the
markets in which we operate.
Over the past 12 months, Genea Biomedx has focused
on the transition of the instrumentation development
projects, Gavi and Geri, through to commercial
manufacture. In Sydney, we upgraded the Kent Street
culture media production facility to comply with stringent
international regulatory standards.
Offshore, the team secured a substantial UK facility which
includes a GMP grade clean-room for large-scale media
manufacturing. The facility is also the intended location of
the European commercial headquarters.
Administratively, we implemented a business-wide
Enterprise Resource Planning system which includes
a sophisticated supply chain management system. We
are also progressing QA processes and regulatory
submissions for Gems, Gavi and Geri. It is anticipated that
the complete range will have CE marking in 2015.

Laura Sandys, MP for South Thanet, Tomas Stojanov,
Genea CEO and Mark Dance, Cabinet Member for
Regeneration and Economic Development at Kent County
Council cutting the ribbon at the new Biomedx UK facility.
Facilities
The existing Kent Street culture media production facility
was upgraded during FY 2014 in order to provide for
increased volumes of commercial media to external
parties in regulated and unregulated markets. The
upgraded facility has state of the art equipment within a
controlled, high-grade clean room environment to ensure
high quality product is provided to customers.

24 Genea Biomedx

Genea Limited Annual Report 2014 25
Genea Biomedx (cont.)
A site in Sandwich, Kent UK, with easy access to
mainland Europe via the Channel Tunnel and nearby
Gatwick Airport, was selected for our European
operations and sales office. The site was previously
operated by Pfizer and included a substantial specialised
clean-room as part of the facility. A new state-of-the-art
media production unit will utilise this space with additional
refurbishment work to incorporate offices, logistics and
service facilities nearing completion. The site was officially
opened in June 2014 an event that was attended by the
local MP and other dignitaries.
In addition to establishing a presence in the UK, we also
successfully applied to the local government in Kent for a
grant to accelerate our operations in the area.
26
Gems Embryo culture medium suite
Gems is our embryo culture medium suite. Originally
formulated in 1991, the third generation of the medium
suite has been in full clinical use within Genea clinics
since February 2013. We are currently supplying all
Genea related clinics across Australia and New Zealand,
as well as Sanatorium Helios clinic in the Czech Republic.
Gems media is a Class III medical device in Europe and
therefore stringent regulatory requirements must be
satisfied prior to clearance being granted by the various
authorities (EMA, MHRA and Notified Bodies). This
process has been underway since 2013, with the various
review time-points being achieved, and clearance for
sale anticipated in 2015. Europe is the primary focus for
commercialisation due to market size, attractiveness and
ease of access.
Genea Biomedx
Gavi Automated vitrification instrument
Vitrification is now a well-accepted methodology to fast
freeze excess embryos for potential use at a later date.
However, the current vitrification process is very manual
and highly dependent on the skill level of the scientist.
Gavi is designed to automate and standardise much of
the vitrification process, ensuring that it is performed the
same way every time.
Production quality units of Geri are in progress with
testing and evaluations in Genea clinics due at the start of
2015. Commercial launch is anticipated later in 2015.
The launch of Geri is eagerly anticipated by the market
and although we have not yet received regulatory
clearance for Geri, we are now being invited by various
conference organisers to participate in specially
organised time-lapse workshops.

Development of Gavi is complete with the transition to
manufacture being the primary focus toward the end of
FY 2014. Production quality units of Gavi have now been
built and utilised for final regulatory testing and clinical
evaluation in Genea clinics before year end. As per Gems,
regulatory clearance for Gavi is anticipated in 2015.
Our continued investment in the various development
and commercialisation activities of Genea Biomedx has
resulted in an EBIT loss for the year of $8.1 million. We
expect that the pay-back from this investment will begin
to be realised over the next 12-18 months as sales of
Genea Biomedxs products ramp up.

Geri Embryo incubator with time-lapse

functionality
Geri is a state of the art embryo incubator. It has been
designed to maintain an optimal environment for the
embryo in its first few days of growth before being
transferred back to the patient. It also has time-lapse
imaging functionality that allows a scientist to review
embryo morphology without taking the embryo out of its
optimal environment.
Interest in time-lapse continues to grow in the market.
Pre-production units of Geri have been displayed at key
scientific conferences during the year, with the response
from delegates and potential customers being very
positive.
Hardware development of Geri is complete with the
transition to manufacture being the primary focus toward
the end of FY 2014. Software is an integral part of Geri
due to the high level of user interaction with the product
and the large volume of data generated by the time-lapse
imaging system. Feedback on the launch version of
software has been very positive due to the intuitive user
interface developed with valuable input from Genea
Fertility embryologists.

Genea Limited Annual Report 2014 27

Genea Biocells
Highlights
In February/March 2014 achieved status as the worlds largest contributor to the NIH registry with 52 approved
human embryonic stem cell lines, surpassing the Harvard Stem Cell Institute for the first time
Commercialisation of stem cell-derived skeletal muscle cells commenced
Business Development team successfully established to drive leads
Additions to Genea Science & Research Commercialisation Committee
Brand development was completed

Introduction in the Huntingtons disease field will expand Biocells

Stem cell-based disease models are gradually becoming
common practice in pharmaceutical drug development
according to a recent survey with 70% of pharma
companies expressing an interest in this technology for
drug discovery. There is also a big push to demonstrate
clinical success of cell therapy - spearheaded by the
California Institute of Regenerative Medicine (CIRM)
and more recently by the UK government (Cell Therapy
Catapult). Both market segments are projected to grow
strongly in the future.
Genea Biocells is well positioned in this market with a
technology platform that comprises key-elements that are
fundamental to applications in research/drug discovery
as well as clinical areas. Our strategy is to engage world
leading experts to build a globally recognised stem cell
company that supplies cells, reagents and services to the
stem cell research/drug discovery market to generate
a revenue stream in the short term while leveraging our
technology platform to advance cell therapy applications
that potentially promise revolutionary future treatment
options.
The year in review
The Biocells business development team was
successfully established by hiring Dr Jamshid Arjomand
as VP Business Development and our first United
States-based employee. Dr Arjomands experience in
rare diseases and coordinating and managing contract
research projects, together with his existing connections
28
customer base in the USA, our most important market.
We also contracted Colin Tristram to establish a presence
in Europe, a market to which we have had little exposure
to date. Their expertise had a significant impact and
transformed the division over the past year with clearer
messaging and direction and a much increased capacity
to generate, follow up and convert leads. At conferences
in the second half of the year we attracted significant
attention and generated over 100 leads from both
pharma/biotech and academic scientists. The team was
further complemented by Dr Alan Colman, an eminent
scientist who recently retired from an academic position
in Singapore. Dr Colman personally knows many stem cell
scientists in both academia and industry and has already
made a valuable contribution through introductions to key
people. The team, with Dr Colmans support are actively
exploring opportunities for Genea Biocells involvement in
European Union-funded consortia which will increase our
credibility and brand awareness in Europe, attract grant
funding and future revenue and leverage Geneas existing
facility and expertise in clinical media manufacturing in
Sandwich, Kent, UK.
Prof Jeanne Loring of the Scripps Research Institute,
San Diego, another eminent, internationally renowned
stem cell scientist, joined the Science and Research
Commercialisation Committee (SRCC). Prof Loring has
been our collaborator for the past five years and is well
connected in California and in general within the USA, our
largest market.
Genea Biocells
 Vascular smooth muscle cells

Genea Limited Annual Report 2014 29

Genea Biocells (cont.)
Business development activities were further supported
by developing the Biocells brand. The brand essence is
defined as science humanised - including an emotional
element that is lacking from all our competitors. The
branding is based on the insight that Genea Biocells,
together with the scientists they partner with, are pushing
the boundaries - exploring new biological frontiers,
pioneering new medical techniques and changing the
game for the sake of human development. The visual
presentation and key messages were well received at
conferences and attracted significant traffic to our booths.
This was an important first step towards establishing
Genea Biocells as a recognisable brand in the stem cell
market.
In October last year we announced a major R&D
breakthrough - the worlds first efficient and scalable
protocol to generate functional skeletal muscle from
human pluripotent stem cells. This process has always
been considered to be very difficult and to date has
not been matched by either competing companies or
academic labs. The soft launch saw us successfully
distributing cells and reagents to a number of
collaborators for further testing, feedback and validation.
Our muscle R&D team, led by Dr Leslie Caron, was then
able to show disease-related phenotypes demonstrating
the potential of our system to model adult diseases
and thus, its usefulness for drug discovery research
and phenotypic drug screening. Our scientific progress
enabled us to secure second research contracts with
both Roche (Switzerland) and Novogen (Australia),
using skeletal muscle cells or skeletal muscle/neurons,
respectively. Stem cell-derived skeletal muscle was more
broadly promoted as a unique and exciting new product
to the wider scientific community and biotechnology
industry at the annual meeting of the International
Society for Stem Cell Research in Vancouver and the BIO
International Convention in San Diego. At both events
skeletal muscle applications dominated the interest of
visitors to our booth or participants in partnering meetings.
30
In February/March 2014 Genea Biocells was the worlds
largest contributor to the NIH registry with 52 approved
human embryonic stem cell lines, for the first time
surpassing the Harvard Stem Cell Institute. NIH approval
is very prestigious and globally recognised as external
validation of the highest ethical standards. It also makes
access to our cell lines easier for many customers and
many companies will only work with cells derived from
NIH-approved stem cell lines.
Our high-content screening platform for stem cell
media development lends itself to screening chemical
compounds for their desired effects on stem cell culture
and differentiation. We have applied this platform very
successfully in the past, the development of the worlds
first skeletal muscle differentiation protocol being a
recent example. Besides muscle, other R&D efforts
focused more consistently on chemical biology since
our market insights showed that there is a strong desire
for biologics-free stem cell culture and differentiation
media due to their advantages of being more consistent,
more stable and easier to produce for clinical
applications. Another benefit is that small molecules are
generally cheaper than biologics, and equivalent small
molecules-based media will have higher profit margins.
This approach will give us a clear competitive advantage
in the stem cell media market for both research and
clinical applications.
Brand development was completed and successfully
rolled out in time for the annual meeting of the
International Society for Stem Cell Research (ISSCR),
the largest scientific stem cell conference. The new
visual design helped to draw in people, and many ISSCR
attendees commented on our presentation.
As with Genea Biomedx, the anticipated portfolio build
up and commercialisation activities of Genea Biocells
resulted in an EBIT loss for the year of $2.5 million.
Again, we expect that the pay-back from this investment
will start to be realised over the next 12-18 months as
sales of Genea Biocells products and services ramp up.
Genea Biocells
Outlook for the Genea Group Genea Biocells
Looking ahead, all three businesses either have a number Revenue from stem cell related products and services
of activities due to come to fruition or about to begin. is expected to grow four fold as the full benefits of the
activities currently being undertaken by the business
Genea Fertility development team are realised. The company intends to
Next Generation Sequencing technology will play a large launch three new products in the coming year:
role in the activities of Genea Fertility in the coming year.
Chemical compound kit
It will deliver improved diagnostic capacity and service
with reduced reporting times. The technology will also Skeletal muscle differentiation kit
contribute to further development of laboratory test
Cardiovascular progenitor medium
menus to cover all aspects of fertility pathology.
Growth is also expected to be derived from the
Pathology services will continue to be expanded to
establishment of distribution agreements for Australia and
provide improved access to collection sites for Genea
New Zealand during the current financial year, followed
patients and clinicians and geographical expansion of
by European agreements in FY 2016.
fertility services nationally and internationally will be
undertaken. A need to be closer to Genea Biocells main market will
see the business expand its US operations. This move
Genea consulting services will be developed with a view
will also assist in reducing operating costs and will allow
to establishing long term revenue streams based on
Genea Biocells to tap into a larger talent pool and take
monetising Geneas extensive IP.
advantage of additional funding opportunities.
Genea Biomedx Finally, integral to their overarching strategy, Genea
Genea Biomedx will take the final steps towards Biocells will expand their position as leaders in stem
validation and registration for Gavi and Geri and will cell-derived skeletal muscle and muscular dystrophy
complete Genea clinical evaluations ahead of the disease models through publications, strategic
publishing of associated scientific papers for both collaborations and partnerships.
instruments.
During the coming financial year, both Gavi and Geri will
We remain firmly of the belief that diversifying our
be in routine clinical use within Genea clinics.
business to add and develop technology and stem cell
CE-Mark clearance will obtained for Gavi and Geri as well arms is the right strategy for the future. It is smarter and
as Gems and ISO13485 regulatory certification will be more sustainable than continuing to compete solely in a
achieved for the wider Genea Biomedx business. crowded market where potential patients primarily use
price as a Australian fertility service decision maker.
Tier 1 regions will be the focus of commercial discussions
with agreements formalised with channel partners in
Europe, Japan and select non-regulated markets.
Alongside expanding administrative work, Genea
Biomedxs UK media manufacturing site will be
commissioned and pilot production will complete.

Genea Limited Annual Report 2014 31

Corporate Governance
This section of the Annual Report outlines Geneas
governance framework. Genea is committed to ensuring
that its policies and practices reflect a high standard of
Corporate Governance.
The Genea policies referred to in this corporate
governance statement are available to shareholders on
the Genea Shareholder Portal at www.genea.com.au/
shareholders.
The Board of Directors
As at 30 June 2014, the Board of Directors of Genea
Limited comprised: Mr Rowan Ross AM (Chair), Professor
Robert Jansen AM, Mr Euan Pizzey, Mr David Smithers
AM, Dr Tomas Stojanov and Dr Robert Woolcott.
The Board of Directors governs Genea Limited to operate
in the field of human reproduction for the long-term
enhancement of shareholder and community value.
In exercising corporate governance, the Board takes
responsibility for the strategic direction of the Company,
appointment of a single or joint Chief Executive Officer (to
whom executive authority is delegated), setting goals for
management, monitoring the achievement of these goals,
and ensuring that all obligations to the community are
met. The Companys obligations include compliance with
legal requirements, observation of sound and consistent
ethical principles, and the pursuit of best scientific and
social practice and outcomes.
Specifically, the Board will:
1. approve the vision and strategic direction of the
Company and ensure that this vision and these
strategic goals evolve as required in the interacting
realms of business, biology, ethics and the community;
2. appoint, review and determine the remuneration of a
single or joint Chief Executive Officer;
3. monitor the operational and financial performance of
the Company and approve the financial statements;
4. regularly review the performance of the Board as a
whole and of individual members of the Board;
32
5. ensure that the processes of strategic planning,
budgeting and reporting (including information, control
and audit systems) are soundly designed, properly
conducted, and regularly monitored;
6. ensure that statutory legal requirements as well as
externally and internally generated ethical standards
are complied with;
7. ensure that appropriate risk management procedures
are maintained and followed;
8. ensure that shareholders and others with legitimate
interests have appropriate, reliable and timely
information regarding the operations of the Company;
and
9. approve and monitor the operation of the delegation
of authority to management under the Statement of
Delegated Authority.
Board composition
In accordance with the constitution of the Company, the
Board will consist of between four and ten directors.
The current Board has a broad range of diverse and
complementary skills and experience, specifically, a
combination of scientific expertise, industry experience,
clinical expertise and financial expertise. The Board
has adopted a policy of ensuring an appropriate mix
of executive and non-executive directors, with the
Chairman to be elected by directors from among the
non-executive directors.
As at 30 June 2014 the Board had one executive
director, being Dr Tomas Stojanov, Chief Executive
Officer, and five non-executive directors, being Mr
Rowan Ross AM, Professor Robert Jansen AM, Mr Euan
Pizzey, Mr David Smithers AM and Dr Robert Woolcott.
On 11 July 2014, the Company lost one of its directors
and the founding father of the Company, Professor
Robert Jansen AM. His enormous contribution to the
establishment and the success of Genea cannot be
measured and it is of paramount importance to the
Corporate Governance
Board to ensure that Professor Jansens vision, mission
and values remain embedded in the Company.
Of the non-executive directors: Mr Ross, Mr
Pizzey and Mr Smithers meet the criteria set out
in the ASX Corporate Governance Principles and
Recommendations (2010) that determine the
independent status of a director as none of these
directors is a substantial shareholder of the Company;
is employed or has been employed by the Company in
an executive capacity within the last three years; has
within the last three years been a principal of a material
professional advisor to the Company; is a material
supplier or customer of the Company; or, has a material
contractual relationship with the Company.
The Chairmans Committee (described below)
assists the Board to review Board composition and
nominations and makes recommendations to the
Board on candidates for appointment as directors. In
recommending potential new directors, and considering
the re-election of incumbent directors, the Chairmans
Committee makes recommendations to the Board after
carefully considering factors including the following:
competencies required to ensure that the Board
is able to efficiently and effectively fulfil its
responsibilities and duties;
the need to maintain an appropriate balance of skills,
experience, expertise and diversity;
relevant regulatory and statutory requirements;
the results of reviews of Board performance; and
the overall mix of functional skills of the members of
the Board.
In accordance with the Companys constitution, one
third of the Board of Directors (excluding the Chief
Executive Officer, either joint or single) retire each year
at the annual general meeting and may be re-elected.
Directors appointed by the Board between annual
general meetings are required by the constitution to
Genea Limited Annual Report 2014
retire at the next following annual general meeting, at
which they may be re-elected.
In addition to six scheduled full meetings each year,
other Board meetings may be held as required and if
necessary on short notice.
Directors have the right, in connection with their duties
and responsibilities as directors, to seek independent
professional advice at the Companys expense in
relation to the Companys affairs, subject to prior written
approval of the Chairman, which will not be unreasonably
withheld. If the Chairman determines it to be appropriate,
such advice will be made available to the other directors.
Under the Companys constitution, the Company
indemnifies its directors, to the extent permitted by law,
against liabilities incurred by the directors in connection
with the Companys affairs to persons other than Genea
Limited or its related bodies corporate.
Conflicts of interest
In accordance with the Corporations Act and the
Companys constitution, a director who has a material
personal interest in a matter that relates to the affairs
of the Company is required to declare the nature of the
interest at a meeting of directors as soon as practicable
after the relevant facts have come to the directors
knowledge. Where the Board believes that a significant
conflict exists, the director concerned does not receive
the relevant Board papers and is not present at the
meeting, or segment of the meeting, at which the item is
considered.
Non-executive directors compensation
It is the policy of the Board to maintain the
remuneration of directors at levels that are consistent
with market practice, having regard to the nature
of their responsibilities and the size and business
activities of the Company. From time to time the
Board will seek independent advice on the directors
appropriate remuneration. Non-executive directors
are paid for their services in aggregate not more than
33
Corporate Governance (cont.)
the fixed sum last approved at a general meeting of
members (shareholders). The directors determine the
remuneration to be paid to each non-executive director
within this aggregate limit, and in the absence of
agreement the aggregate fixed sum is paid to them in
equal shares.
Ethical standards of corporate conduct
The Board endeavours to ensure that the directors,
officers and employees of the Company act with
integrity and observe the highest standards of behaviour
and business ethics in relation to their corporate
activities, and comply with the Genea Code of Conduct.
Directors, officers and employees are expected:
1. to comply with the law and the constitution of the
Company;
2. to adhere to recommendations made by the
Companys independent auditors, the Ethics
Committee, and the Professional Advisory Board;
3. to act only in the best interest of the Company and its
shareholders taken as a whole;
4. to disclose actual or potential conflicts of interest,
including any additional direct or indirect commercial
relationship with the Company or with the Companys
competitors;
5. to be responsible and accountable for all their actions,
and to act always with due skill, care and diligence;
6. to observe the ethical values of fairness and honesty;
7. to respect the dignity of others;
8. at all times to respect the privacy and right to
confidentiality of the Companys patients, clients and
customers; and
9. not knowingly to conceal an error, whether clinical,
scientific, clerical or administrative (the reciprocal duty
of the Company being a policy not to disadvantage a
member of the Company for the making of a mistake).
34
Diversity
On 15 August 2012, the Board approved the Genea
Diversity Policy. The policy is designed to support and
promote the principles of diversity in the workplace
and the Board monitors the Companys overall diversity
strategy and policy.
Genea currently reports annually to the Equal
Opportunity for Women in the Workplace Agency on
the policies and business practices Genea has in place
for all staff and for women that are either aimed at or
have resulted in contributing to equal opportunity in the
workplace.
Genea is very proud of the gender diversity that exists
within the Company. Women comprise 89% of the
total Genea workforce and occupy 66% of senior and
frontline management positions, and women currently
hold 2 of the 8 senior executive positions on the Genea
Executive Committee.
Board committees
1. Chairmans Committee
Chaired by the Chairman of the Board and consisting
entirely of non-executive directors with the majority
being independent, the role of the Chairmans
Committee is to assist the Board in fulfilling its
responsibilities by reviewing, advising and making
recommendations to the Board in the following areas:
A. Remuneration:
the Companys remuneration, recruitment, retention
and termination policies and procedures for senior
executives;
senior executives remuneration and incentives;
superannuation arrangements;
the remuneration framework for directors; and
gender equality remuneration.
Corporate Governance
B. Nomination
the necessary and desirable competencies of
directors;
review of board succession plans;
the development of a process for the evaluation of
the performance of the board, its committees and
directors; and
the appointment and re-election of directors.
The Committee thus assures the Board of the
effectiveness, integrity and compliance of the Companys
remuneration and nomination policies and practices,
ensures that the overall remuneration and nomination
policies and approaches fit with the strategic goals
of the Company, and assists the Board in appropriate
executive management and Board succession planning.
Specifically, the Committee must consist of at least
three non-executive directors with the majority being
independent, confirmed annually by the Board, is chaired
by the Chairman of the Board, has the power to appoint
a secretary, and includes the following duties and
responsibilities:
1. to make recommendations to the Board on the
remuneration to be paid to a single or joint Chief
Executive Officer, including any offers of equity;
2. to make recommendations to the Board on the
remuneration to be paid to the non-executive
directors, including any retirement schemes;
3. to review and approve the total annual remuneration
paid to employees of the Company, including any
equity offers;
4. to review and monitor remuneration paid to direct
reports to a single or joint Chief Executive Officer;
5. to exercise all of the powers and discretion of
the Board in relation to equity plans for directors,
executives and other officers and employees;
Genea Limited Annual Report 2014
6. to review Board composition and nominations and
make recommendations to the Board on candidates
for appointment as directors and, when necessary, on
the process for the re-election of directors;
7. to review and make recommendations to the Board
on the operation of the Board, including reviewing the
performance of the current directors;
8. to review reports on management succession
planning for executive positions and board succession
plans;
9. to review human resource policies and practices for
the Company including superannuation arrangements;
and
10. each year, to review these terms of reference.
The Chairmans Committee has in place processes to
review and evaluate the performance of the Board, its
Committees, individual directors and the Companys
senior executives. The process for conducting the
Boards performance review consists of the Chairman
conducting individual interviews with each of the
directors. In conjunction with those interviews, the
directors complete a questionnaire and are able to
make other comments or raise any issue that they have
relating to the Boards or a Board Committees operation.
Where appropriate, feedback from senior executives
may also be sought as part of the review process. The
performance of the Board was assessed during the
financial year ended 30 June 2014 in accordance with
this process, and is due to again be assessed during
the financial year ending 30 June 2015. Additionally,
the Board, through the Chairmans Committee, annually
reviews the performance of a single or joint Chief
Executive Officer. In relation to the Companys senior
executives, a single or the joint Chief Executive Officers
will evaluate, at least annually, the performance of those
executives. Either a single or the joint Chief Executive
Officers report to the Chairmans Committee on the
performance of senior executives in conjunction with the
remuneration review process. The performance of senior
35
Corporate Governance (cont.)
executives was assessed during the financial year ended
30 June 2014, in accordance with this process.
The Committee must meet as often as the Chairman
decides is needed to fulfil its duties. As well, the
Chairman must call a meeting if asked to do so by the
Board, by a single or joint Chief Executive Officer, or by
any of the Committees members. A majority of members
constitutes a quorum.
At 30 June 2014, the Committees membership
comprised: Mr Rowan Ross AM (Chair), Professor
Robert Jansen AM, Mr Euan Pizzey, Mr David Smithers
AM and Dr Robert Woolcott.
2. Audit, Risk Management and Compliance Committee
The Audit, Risk Management and Compliance
Committee assists the Board in fulfilling its
responsibilities relating to accounting and financial
reporting practices, the management of business and
operational risks, and the placement, compliance and
monitoring of internal controls.
Specifically, the Committee:
1. oversees the integrity and quality of financial
information presented to the Board;
2. reviews the independence and appointment of the
auditor;
3. oversees the scope and the quality of the external
audit;
4. evaluates the need for and scope of internal audit
processes, taking account of the Companys risk
profile;
5. gains assurance that there are processes in place for
appropriate management of identified risks;
6. ensures that the management of identified risks is
monitored through a number of activities including
internal and external audits; and
7. ensures compliance with statutory responsibilities and
internal policies.
36
Correspondingly, the Committee has the following duties
and responsibilities:
1. to review the audit plan with the external auditors in
advance;
2. to determine that no management restrictions are
being placed upon the external auditors by inter alia
meeting alone with the auditor at least annually;
3. to evaluate the overall effectiveness of the external
audit;
4. to evaluate the adequacy of the Companys
accounting control system by reviewing written reports
from the external auditors and monitor the Boards
and managements responses and actions to correct
any noted deficiencies;
5. to review managements response to the external
auditors letter prior to remittance of that response;
6. to review all financial reports to be made public prior
to their release;
7. to review and consult on all significant accounting
policy changes;
8. to review the financial statements contained in the
statutory accounts and annual report with the Chief
Executive Officer (joint or single), the Chief Financial
Officer and external auditors and recommend
acceptance to the Board;
9. to oversee the assessment of the risk profile for the
Company, to understand the key risks affecting the
financial, regulatory and operational exposures of
Genea Limited;
10. to review the risk management systems for the
adequacy of systems to monitor and manage the key
risks, by setting prudent limits, and requiring adequate
and timely reporting processes;
11. to review the effectiveness of the policies and
procedures designed to minimise risk exposure;
Corporate Governance
12. to plan internal audit practices and projects including
communicating expectations, approving the scope,
monitoring managements response and assessing
the effectiveness of the internal audit;
13. to prepare a report to the Board summarising the
work performed by the Committee to fully discharge
its duties during the year;
14. to review the existence and adequacy of the
Companys insurance policies and ensure they are
sufficient to cover the nature and value of potential
loss from insurable events;
15. to review management of cash and other assets;
16. to advise the Board on any regulatory compliance
and reporting issues likely to affect the Companys
financial performance, operation or service;
17. to undertake self-assessment process; and
18. each year, to review these the terms of reference.
Composition of the Committee
The Committee must have at least three members and:
each member must be a non-executive director;
the majority of members must be independent
directors; and
the Committee must be chaired by an Independent
Chair who is not Chair of the Board.
Further, in accordance with the ASX Corporate
Governance Principles and Recommendations (2010),
the Committee includes one member who is a qualified
accountant and members who are all financially literate
and some members who have an understanding of the
industry in which the Company operates.
The Board confirms membership of the Committee
annually and appoints one of the members to chair the
Committee.
Genea Limited Annual Report 2014
The Committee has unfettered access to the external
auditors and to senior management of the Company,
and may seek external advice and outsource projects
where it deems this necessary. The Committee has
adopted an Audit Independence Policy which addresses
the selection and appointment of the external auditor,
the rotation of external audit engagement partners and
policies to ensure audit independence.
The Committee holds at least three meetings per year
and such additional meetings as the Chair shall decide
in order to fulfil its duties. In addition, the Chair calls a
meeting of the Committee if required to do so by any
Committee member, the Chief Executive Officer (joint or
single), the Board, or the external auditors.
If a Committee member cannot attend a meeting, he or
she may appoint an alternate for such a meeting. The
alternate must be a non-executive member of the Board.
A quorum consists of a majority of Committee members,
and the executive provides secretarial assistance to the
Committee.
All directors of the Company who have not formally
been appointed by the Board to the Committee have the
right to attend Committee meetings. All directors of the
Company are provided with copies of the agenda papers
and minutes of the meetings in the same manner and at
the same time as members of the Committee.
In addition to the Companys auditors attending the
relevant Committee meeting that reviews the Companys
financial statements, the Companys auditors have a
standing invitation to each and every meeting of the
Committee.
At 30 June 2014, the Committees membership
comprised: Mr David Smithers AM (Chair), Mr Rowan
Ross AM and Mr Euan Pizzey.
37
Corporate Governance (cont.)
Risk Management
The Company has a comprehensive system of risk
management and oversight, administered by the Chief
Risk Officer who reports to each meeting of the Audit,
Risk Management and Compliance Committee on the
effectiveness of the Companys management of its
material business risks. The risk management system
includes extensive policies addressing the identification,
control and management of material risks, including
management of appropriate insurances.
The Chief Executive Officer and the Chief Financial
Officer have provided assurance, in writing to the
Board that the financial reporting risk management and
associated compliance and controls have been assessed
and have been found to be operating effectively. The
operational and other risk management compliance
and controls have also been assessed and found to be
operating effectively.
Advisory committees
1. Ethics Committee
The Company maintains an Ethics Committee composed
predominantly of men and women who are independent
of the Company and who are eminent in the community.
The Committee will:
Scope of responsibilities
1. provide independent ethical review of research
involving humans conducted by the Company,
as required by the National Statement on Ethical
Conduct in Human Research (National Statement),
including by reviewing protocols and progress reports
on such research. The Committee may establish
procedures for the review of low risk research in
accordance with the National Statement;
2. not generally provide ethical approval or monitoring
of research by researchers not affiliated with the
Company;
38
3. in addition to review of research involving humans, the
Committee may be asked to review from an ethical
and community perspective matters of ethical concern
to the Company;
4. pay special attention to the processes of consent
and agreement by which members of the public are
treated or have tests performed at or by the Company;
5. establish, implement and document working
procedures to promote good ethical review;
Membership and meetings
6. comprise a chair and members in at least such
number and categories as is required by the National
Health and Medical Research Council (NHMRC) to
fulfil all functions required of an institutional Human
Research Ethics Committee;
7. meet at least four times each year, and (at the
discretion of the Committees Chairman) as requested
by members of either the Committee or the executive;
8. for at least a part of each meeting, consider matters in
the absence of executives of the Company;
Accountability and reporting
9. report annually or otherwise as required to the
NHMRC and its committees on the conduct of its
business, and provide a copy of that report to the
Board;
10. maintain its independence of the Companys
operations (including by the open disclosure by
members to the Chairman of the Committee of any
personal or commercial matter that could cause
a conflict or an appearance of a conflict with the
independent operation of the Committee);
11. maintain a direct link with the Chairmans Committee
of the Board, including the holding of at least one joint
meeting each year of which a part will be conducted in
the absence of executives of the Company;
Corporate Governance
12. directly, and without any necessary reference to
the executive members of the Company, inform the
independent directors of any substantial or unresolved
concern the Committee may have in relation to any
aspect of the Companys conduct of its business;
Remuneration
13. not charge fees for the provision of ethical review of
the research and other activities of the Company; and
14. make public, in the Companys annual report each
year, the remuneration paid to the members of the
Committee.
In the past year, Dr Simon Longstaff AO and Mr James
Lane resigned as members of the Committee. The
Board extends their deep appreciation for their work
on the Committee over many years. The Board also
welcomes Ms Paula Trigg, Ms Barbara Ramjan and Rev.
Peter Kurti who joined the Committee this year.
At 30 June 2014, the membership of the Committee
comprised: Mr Bruce Cutler (Chair), Hon. Jim Longley
(layman), Rabbi Jacqueline Ninio (minister of religion),
Dr Edith Weisberg AM (doctor familiar with, but not
of, the institutions fields of research) and Professor
John Rasko AO (clinical haematologist with significant
research experience), Ms Paula Trigg (layperson), Ms
Barbara Ramjan (counsellor) and Rev. Peter Kurti
(minister of religion). For the financial year ended 30
June 2014 the Chairman of the Ethics Committee is
an annual fee of $9,000 (which equates to $1,500 per
scheduled meeting), and each other member of the
Committee received an annual fee of $4,500 (which
equates to $750 per scheduled meeting). Professor
Rasko, who is the Companys principal approved
pathology practitioner, and has other technical advisory
roles within the Company, received $108,900 for these
services (including his fee for the Ethics Committee) for
the financial year ended 30 June 2014.
Genea Limited Annual Report 2014
2. Science and Research Commercialisation Committee
Principal committee functions
The Science and Research Commercialisation
Committee is an advisory committee to the Genea
Board. The Committees purpose is to inform the Board
and to assist the Chief Executive Officer (joint or single)
to create strategies, systems, processes and procedures
that will advance Genea as a science-based business.
Specifically, the Committee will ensure that:
1. the scientific, research and development paths set by
Genea Biomedx and Genea Biocells are those that
best match the Companys business strategy;
2. the Companys research and development strategy
is that which makes best use of the opportunities for
the Companys business model in the Australian and
international market place, and
3. the Company monitors the ongoing scientific and
commercial viability of R&D projects on hand and
ensures that the maximum commercial value is
extracted from them.
Committee membership
The membership of the Committee will include at least
four members:
1. a Genea non-executive director to chair the
Committee. This position is currently held by Mr Euan
Pizzey;
2. an external non-executive member to monitor and
advise on scientific activities. This position is currently
held by Professor Alan Colman;
3. an external non-executive member to monitor and
advise on commercialisation activities. This position is
currently held by Dr Dianne Glenn.; and
4. the Chief Executive Officer, Dr Tomas Stojanov.
39
Corporate Governance (cont.)
The Company is delighted to welcome the eminent
scientist, Dr Jeanne F. Loring as a new member of
the Committee. Dr Loring is the founding director of
the Center for Regenerative Medicine at The Scripps
Research Institute, La Jolla, California.
Committee responsibilities in practice
To assist Genea management to establish strategies,
systems, processes and procedures that enable
management and the Committee:
1. to ensure that commercial returns are maximised on
current and future R&D programs and IP assets;
2. to identify unique Genea inventions to be protected by
patent;
3. to enable the commercial opportunities that should
guide the future R&D programs, product development
requirements and IP acquisitions to be identified and
evaluated; and
4. periodically to conduct reviews to identify and evaluate
areas of potential commercial opportunity for Genea.
Committee reporting and accountability
The Committee reports to the Genea Board after each
of the Committees meetings, by way of
a brief, memo-style Actions Arising report; and
a verbal report from the Committee Chairman to a
single or joint Chief Executive Officer.
Ethics and governance
The Committee:
is subject to Geneas corporate governance rules as
they apply to other Board Committees and to the
Board itself, both in the way the Committee operates
within its charter and in how it deals with conflicts of
interest; and
ensures that the Ethics Committee is advised of new
R&D projects that are initiated or approved.
40
Work program and meetings
The Committee conducts a number of formal meetings
each year.
These meetings are supplemented by meetings and
teleconferences between individual members and
management as required.
Meetings are convened at the discretion of the
Committee Chair.
Remuneration and tenure
The Genea Board determine the remuneration of
non-employee members of the Committee.
The Chair of the Committee is remunerated in
accordance with the directors fees payable for a
chairman of a Board Committee.
Non-Board, non-executive members are paid quarterly
in arrears on submission of an invoice for a quarter of
the agreed annual fee as determined by the Board.
Alternatively, members may elect to receive shares in
lieu of cash remuneration (net of any applicable income
tax) under the same conditions as those which apply to
directors of the Company.
Membership of the Committee is made by annual
appointment and is subject to review by the Board each
year between the end of the financial year and the
annual general meeting.
Operational framework
To achieve its objectives, the Committee may, through
the Chief Executive Officer:
work closely with one or more key executives of the
Genea Biomedx and Genea Biocells, and
request assistance from other business divisions
within the Company.
Corporate Governance
Operational responsibilities
Together, the Chair of the Committee and the Chief
Executive Officer develop formal reporting requirements
and procedures for:
monitoring current R&D projects of the Genea
Biomedx and Genea Biocells divisions;
evaluating proposals for new products and services of
the Genea Biomedx and Genea Biocells divisions; and
keeping abreast of the R&D of others.
These written requirements and procedures are
identified as annexures to the Committees charter, will
be kept up-to-date by the Committee, and modifications
will be provided to the Board at its next meeting as part
of the divisional report.
At 30 June 2014, the membership of the Committee
comprised: Mr Euan Pizzey (Chair), Professor Alan
Colman, Dr Dianne Glenn, Dr Jeanne Loring and Dr
Tomas Stojanov.
Shareholder Communications and relevant Company
Policies
Developing strategies for communicating effectively with
shareholders of the Company and policies that enhance
the Companys corporate governance framework are
important priorities for the Board.
The Company prepares and issues quarterly
Shareholder Updates to shareholders. These updates
contain a summary of the Companys most recent
financial results, with discussion and analysis of that
information to provide shareholders with regular access
to balanced and understandable information about
the Company. It also provides an opportunity for the
Company to disclose any other information that may be
considered price sensitive, as the Company approved
the Genea Continuous Disclosure Policy in May 2005 to
formally adopt an ongoing disclosure regime (although
by law Genea Limited is not currently required to
comply with the Corporation Law continuous disclosure
Genea Limited Annual Report 2014
requirements). The Company also issues shareholder
notices at other times if it considers that information
should be disclosed to all participants in the market for
shares in the Company.
The Company has had in place since May 2006, the
Genea Share Trading Policy as directors, officers and
employees are subject to the Corporations Act 2001
restrictions on applying for, acquiring and disposing
of securities in the Company if they are in possession
of inside information. The policy has been designed
to ensure that all shareholders and other eligible
participants may only buy and sell shares once
price sensitive information has been released to all
participants who can participate in the market for shares
in the Company.
In February 2010, the Company was granted an
exemption by ASIC from the operation of Part 7.2 of
the Corporations Act 2001. Under this exemption, the
Company must operate the market in shares in the
Company strictly in accordance with the process set
out in the Companys constitution, and the Company
must establish and maintain adequate arrangements to
manage any conflicts of interest that arise in relation
to any activities undertaken by the Company in the
market for shares. The Board approved the Genea
Conflicts of Interest Policy in June 2010 which outlines
the arrangements in place to manage any conflicts
of interest that may arise in relation to any activities
undertaken by the Company in the operation of the
market for shares in the Company.
The Genea Shareholder Communications Policy,
approved by the Board in September 2010,
summarises the various methods the Company has
adopted for promoting effective communication with
shareholders and a copy of this and all policies relevant
to shareholders have been uploaded to the Genea
shareholder portal at www.genea.com.au/shareholders.
41
Our Values
At Genea, everything we do is in the spirit of our Values. Our Principles
The dominating principles by which we apply our Values
Integrity
were codified (as Our Goals) in the mid 1990s and have
Do the right thing. been reiterated annually since.
Excellence This set of principles governs, controls and clearly defines
Lead beyond the expected. how we must operate:
1. When reproductive ambitions are in jeopardy, to
Accountability provide our services in ways that will strengthen
See. Own. Solve. Do. peoples wellbeing and their relationships, whatever
the reproductive outcome and whatever their family
Innovation circumstances.
Imagine. Initiate. Strive.
2. In working with the people who seek our services,
Passion always and above all else, to respect their and their
Believe. Inspire. Celebrate. childrens need for knowledge, for compassionate
care and for privacy and confidentiality and never
Our Mantra knowingly to jeopardise their interests in any way
without immediate disclosure and explanation.
3. To utilise our research and the research of others to
advance best reproductive medical and social practice
and to be transparent and open in our interactions
within each community in which we practice our art.
4. To achieve these ends in a way that expects everyone
Our Mission at Genea to show leadership, responsibility and
In 2014 we reviewed our Mission and Vision to ensure accountability to produce a personal, compassionate,
they stay relevant and compelling. Our Mission remains non-discriminatory, cost-effective and professionally
the same but in a broader context. To fulfil peoples hopes satisfying environment in which to work.
and expectations for a healthy baby (by providing fertility
5. To expand our business in Australia and abroad and, in
services and technologies around the world).
doing so, to reaffirm these Principles and the Values to
Our Vision which we aspire.
Our Vision is to grow Genea from a specialised IVF & 6. To produce an appropriate return on equity for
research organisation to an integrated fertility services & investors in Genea.
products company with broad geographical reach.

42 Corporate Governance

Financial Report
Directors report 44
Statement of financial position 55
Statement of profit or loss and other comprehensive income 56
Statement of changes in equity 57
Statement of cash flows 58
Notes to the consolidated financial statements 59
Directors declaration 108
Independent auditors report 109
Lead auditors independence declaration 110
Additional information 111

Genea Limited Annual Report 2014 43

Directors Report
The directors present their report together with the financial report of Genea Limited (the Company) and its
subsidiaries and interest in associates (the Group) for the financial year ended 30 June 2014 and the auditors report
thereon.

1. Directors
The directors of the Company at any time during or since the end of the financial year are:

Name, qualifications and

Age
independence status
R.A. Ross AM
BEc, BCom, FASCPA, SF Fin
Chairman
Non-Executive Director
Experience, special responsibilities and other directorships
65 More than 40 years experience in investment banking. An Executive
Director of Macquarie Capital (Australia) Limited; former Chairman
of Bankers Trust Investment Bank; former National President of the
Securities Institute of Australia and former Chairman of the Sydney
Dance Company, the Australian Brandenburg Orchestra and the
Australian Major Performing Arts Group
Appointed 31 July 2002
Chairman of the Chairmans Committee
Member of the Audit, Risk Management and Compliance Committee

R.P.S. Jansen AM 67 Founding Managing Director and a major shareholder. Executive

MD (Syd), FRACP, FRANZCOG, CREI, Chairman from 1984 to 1991. Extensive experience in reproductive
OPM (Harvard) medicine and IVF; inaugural Chairman of Australias Reproductive
Non-Executive Director Endocrinology and Infertility Subspecialty Board; a past member of
NHMRC Committees including the Medical Research Ethics Committee;
and Clinical Professor at the University of Sydney since 1993
Appointed as an Executive Director on 17 October 1984 and a
Non-Executive Director on1 January 2011
Former member of the Chairmans Committee
Deceased 11 July 2014

C.E. Pizzey 66 20 years experience as a practising Chartered Accountant including 10

Dip Com, FCA, FTIA, CPA, CTA years as a partner of Coopers & Lybrand. 17 years extensive experience in
Non-Executive Director commercialisation and financing of biotechnology. Former Director, CFO and
Company Secretary of Vision Systems Ltd. Former Director of AFL Films
Appointed 4 March 2009
Member of the Chairmans Committee and the Audit, Risk Management
and Compliance Committee
Chairman of the Science and Research Commercialisation Committee

44 Directors Report

 Name, qualifications and
independence status
D.W. Smithers AM
FCA, FICD
Non-Executive Director
T. Stojanov
PhD, GMP (Harvard)
Chief Executive Officer
R.J. Woolcott
MBBS (Hons), FRANZCOG, CREI,
AMP (Harvard)
Non-Executive Director
On 11 July 2014, the Company lost one of its directors and the founding father of the Company, Professor Robert
Jansen AM. His enormous contribution to the establishment and the success of Genea cannot be measured and it is of
paramount importance to the Board to ensure that Professor Jansens vision, mission and values remain embedded in
the Company.
Genea Limited Annual Report 2014
Age Experience, special responsibilities and other directorships
70 Extensive experience as a Partner and Chairman of
PricewaterhouseCoopers in Australia. A former Director of Rabobank
Australia Group; International Energy Services Ltd Group and Sydney
Symphony Limited
A former president of the Institute of Chartered Accountants in Australia.
Appointed 16 February 2005
Member of the Chairmans Committee
Chairman of the Audit, Risk Management and Compliance Committee
50 More than 26 years experience in the health, biotechnology and agriculture
sectors in a range of capacities including scientific research, operational
management and commercialisation. Previously Director of Research and
General Manager of Stem Cells and Research
Appointed 1 January 2011
Member of the Science and Research Commercialisation Committee
56 Medical and Managing Director of Genea Newcastle; Non-Executive
Director of Genea Perth and Medical Director of Genea Oxford. Former
Member of the RANZCOG Reproductive Endocrinology and Infertility
Sub-specialty Board, the Hunter Postgraduate Medical Institute Board and
the Mayne Health Medical Advisory Board
Appointed 1 January 2011
Member of the Chairmans Committee
Chairman of the Genea Biomedx Advisory Board
45
Directors Report (cont.)
2. Company Secretary
Ms Mary Weaver AGIA, ACIS BA(Hons), LLB was appointed to the position of Company Secretary on 28 June 2012.

3. Directors meetings
The number of directors meetings (including meetings of committees of directors) and number of meetings attended
by each of the directors of the Company during the financial year are:

Director Board Meetings Audit, Risk Management Chairmans

& Compliance Committee Committee Meetings
Meetings

No. Of Meetings No. Of Meetings No. Of Meetings No. Of Meetings No. Of Meetings No. Of Meetings
Held Attended Held Attended Held Attended

R. A. Ross 8 8 3 2 3 3
R.P.S. Jansen (1) 8 3 n/a n/a 3 1

C.E. Pizzey 8 8 3 3 3 3
D.W. Smithers 8 8 3 3 3 3

T. Stojanov 8 8 n/a n/a n/a n/a

R.J. Woolcott 8 8 n/a n/a 3 3

(1) On extended leave of absence.

46 Directors Report

4. Directors remuneration
The Chairmans Committee is responsible for making recommendations to the Board on executive and non-executive
directors remuneration.
The Boards remuneration policy is to ensure remuneration packages properly reflect the individuals duties and
responsibilities and that the remuneration is competitive in attracting and retaining executive and non-executive
directors having the requisite skills, experience and capacity to meet the Companys needs.
Directors remuneration incorporates:
for all directors, a fixed or base income component, which includes cash remuneration and superannuation; and
for executive directors only:
annual bonuses, based on quantitative and qualitative factors; and
the issue of options based on profitability or shareholder return targets. These are provided as longer term
incentives.
Details of the nature and amount of each major element of the emoluments of each nonexecutive director of the
Company in respect of the year ended 30 June 2014 are set out hereunder:

Director Cash remuneration Superannuation Total

$ $ $

R.A. Ross(1) 132,723 12,277 145,000

R.P.S. Jansen (1) 64,073 5,927 70,000
C.E. Pizzey 77,803 7,197 85,000
D.W. Smithers (1) 77,803 7,197 85,000
R.J. Woolcott (1) 66,552 6,156 72,708
418,954 38,754 457,708

(1) These directors elected to receive a component of their remuneration as shares in Genea rather than cash as permitted by a resolution of
shareholders.

Additional disclosure on the remuneration of directors is provided in notes 24(b) and 31 to the financial statements
provided as part of this annual report.

Genea Limited Annual Report 2014 47

Directors Report (cont.)
5. Directors interests
The relevant interest of each director in the shares and options over such instruments issued by the Company at the
date of this report is as follows:

Ordinary shares - Ordinary shares - Total number of

Director
direct interest indirect interest ordinary shares

R. A. Ross 58,195 - 58,195

R.P.S. Jansen - 866,063 866,063

C.E. Pizzey - 12,783 12,783

D.W. Smithers - 15,936 15,936

T. Stojanov 7,500 - 7,500

R.J. Woolcott - 288,056 288,056

6. Share options
Options granted to directors and officers of the Company
During or since the end of the financial year, the Company has not granted options over unissued ordinary shares in
the Company to any non-executive director of the Company.
Additional disclosure on share options is provided in note 24(b) to the financial statements as part of this annual report.

Unissued shares under options

At the date of this report there are no unissued ordinary shares of the Company under options.
Note 24(b) to the financial statements details the option plan rules.

7. Principal activities
The principal activities of the Group during the course of the financial year were the provision of assisted reproductive
technology (ART) services and research and development in the field of reproductive science and medicine, including
the commercialisation of research and development outcomes.
No significant change in the nature of these activities occurred during the year.

48 Directors Report

8. Operating and financial review
Overview of the Group
The Group result in 2014 reflects the investment necessary to transform Genea from a domestically focused,
clinic-centric operation into an international IVF products and services business.
Revenues of $76.3 million are up 4.0% on last year (2013: $73.4 million) due to an improved result in Fertility. It should
be noted that 2013 Group revenue included a one-off $2.7 million fee from the sale of a media licence.
Profit attributable to equity holders of the Company of $4.9 million is in line with the prior year (2013: $4.9 million),
despite increased costs in Fertility and continued investment in research, development and commercialisation in
Biomedx and Biocells, including initial trading losses as these start-up businesses become established.
Net cash during the year decreased $4.6 million (2013: $4.9 million decrease), after external funding via secured bank
loan and overdraft totalling $5.4 million, due to reduced operating cash flows and continued investment in research
and development, as well as capital expenditure in relation to the fitout of culture media production units in Sydney,
Australia and Kent, UK, and various technology projects. Unutilised AUD facilities totalled $8.1 million at 30 June 2014
(see Note 23).

Review of principal businesses

From 1 July 2013 the Group established two new businesses: Genea Biomedx Pty Limited (Biomedx), for the
manufacture and sale of media and instruments used in IVF, and Genea Biocells Pty Limited (Biocells), for the
cultivation and sale of stem cells. Both businesses utilise research developed by the Groups Stem Cells & Research
division over many years. Trading for these two new businesses has been reported separately commencing 1 July
2013 and replaced reporting for the Stem Cells & Research division from that date.

2014 2013
Segment revenue $000 $000
Fertility 75,436 69,849
Biomedx 110 2,670
Biocells 713 923
Segment profit before interest and tax (EBIT)
Fertility 14,171 13,312
Biomedx (8,078) (3,741)
Biocells (2,511) (1,755)
Segment assets
Fertility 33,180 28,316
Biomedx 13,770 8,854
Biocells 3,792 5,130

Genea Limited Annual Report 201449

Directors Report (cont.)
Fertility
Segmental revenues of $75.4 million are up 8.0% on last year (2013: $69.8 million) due to a 5.6% increase in
the number of oocyte pick-ups (OPUs) and a price increase implemented during the financial year. The increase
in OPUs reflects an improving IVF market that in aggregate has grown by approximately 7% in the states and
territories where the Group operates. Segmental EBIT of $14.2 million is up 6.8% on last year (2013: $13.3 million)
due to a $1.3 million write-off of goodwill to recognise the shift away from our traditional diagnostic offerings
towards new molecular-based technology services. Adjusting for this one-off item segmental EBIT would have
been $2.2 million (16.5%) higher than the prior year.

Biomedx
Segmental revenues of $0.1 million (2013: $2.7 million) reflect the start-up nature of this business, with media sales
at this stage confined to associated entities pending European accreditation (CE marking) and sale of instruments
not due to commence until 2015. There was a one-off $2.7 million fee from the sale of a media licence in prior year.
The segmental EBIT loss of $8.1 million (2013: loss of $3.7 million) reflects the Groups continued investment in
the development and commercialisation of Biomedx activities. The pay-back from this investment is expected to
commence over the next 12-18 months as sales of Biomedx products ramp up.

Biocells
Segmental revenues of $0.7 million (2013: $0.9 million) reflect the start-up nature of this business, with a dedicated
business development team being established during the financial year. The segmental EBIT loss of $2.5 million
(2013: loss of $1.8 million) reflects initial trading losses and continued development of Biocells stem cell-based
discovery platform.

Shareholder return

2014 2013 2012 2011 2010

Net profit attributable to equity
$4,936 $4,883 $9,060 $7,781 $10,184
holders of the Company ($000)
Basic earnings per share (EPS) $1.73 $1.73 $3.23 $2.80 $3.75
Dividends paid ($000) $2,363 $5,546 $6,597 $6,497 $7,079
Dividends per share(1) $0.83 $1.96 $2.35 $2.35 $2.60
Share price (2)
$50.19 $55.00 $48.50 $58.88 $52.36
Return on equity (3)
17% 19% 35% 34% 52%

(1) Dividends per share disclosed on an historically paid basis.

(2) Based on the latest traded price.
(3) Determined as Profit Attributable to Equity Holders of the Company divided by Total Equity Attributable to Equity Holders of the Company.

50 Directors Report

Aggregate returns to shareholders in the form of dividends have declined relative to the prior year as a result of the
decrease in net profit, as has the return on equity, although EPS is consistent with prior year.
The latest share price based on recent trades is approximately $50.00 per share. The shares were independently
valued in the range $55.00 $74.32 in September 2013. A short-form independent valuation was obtained in July
2014 which indicated that the market value of the shares is likely to have marginally reduced since the full valuation.

Significant changes in the state of affairs

In the opinion of the directors there were no significant changes in the state of affairs of the Group that occurred
during the financial year under review other than as disclosed in this report.

9. Dividends
Dividends paid or declared by the Company to members since the end of the previous financial year were:

Cents Franked/
Total amount Date of payment
per share unfranked

Declared and paid during the year 2014 $000

Interim 2014 ordinary 37.0 1,053 Unfranked 24 April 2014

Final 2013 ordinary 46.0 1,310 Unfranked 26 November 2013

Total amount 2,363

Declared after end of year

After the balance sheet date the following dividends were declared by the directors. The dividends have not been
provided for and there are no income tax consequences.

Cents Franked/
Total amount Date of payment
per share unfranked

Declared after end of year $000

Final 2014 ordinary 54.0 1,539 Partially franked 28 November 2014

The financial effect of these dividends has not been brought to account in the financial statements for the year ended
30 June 2014 and will be recognised in subsequent financial reports.

Genea Limited Annual Report 2014 51

Directors Report (cont.)
10. Events subsequent to reporting date
On 11 July 2014, Company director and founder, Professor Robert Jansen, passed away.
At 1 July 2014 the assets and liabilities of the Genea Genetics Unit Trust were transferred to Genea Limited and the
trust dissolved.
Development of a media production facility for Genea Biomedx at its premises in Kent, UK is expected to be
completed in the next financial year and the building itself acquired, with some financial assistance made available by
the local regional development council.
The Group opened a new IVF clinic in St Leonards in August 2014, as part of its program of expanding in important
markets.
In July 2014, the Group incorporated two wholly owned foreign subsidiaries, Genea (UK) Limited in the United
Kingdom and Genea Hong Kong Limited in Hong Kong. Neither subsidiary has commenced operation.
In August 2014, the Company became aware that an independent specialist who utilised the Superior ART (SART)
facility treated a patient engaged in a commercial surrogacy arrangement. Following this incident, the Company has
assisted SART with improvements to its risk governance framework to ensure it is equivalent to Geneas ethical and
risk governance framework.
Other than these matters and those noted elsewhere in this report, there has not arisen in the interval between the
end of the financial year and the date of this report any item, transaction or event of a material or unusual nature likely,
in the opinion of the directors of the Company, to affect significantly the operations of the Group, the results of those
operations, or the state of affairs of the Group, in future financial years.

11. Likely developments

The outlook for the Groups future developments and results in subsequent financial years is commented on in the
Chief Executive Officers Report.

12. Indemnification and insurance of officers and auditors

Indemnification
No indemnities have been given or insurance premiums paid, other than in accordance with the provisions of paragraph
35 of the Companys constitution, during or since the end of the financial year, for any person who is or has been an
officer or auditor of the Group.

Insurance premiums
During or since the financial year, the Company has paid insurance premiums in respect of directors and officers
liability insurance contracts for current and former directors and officers, including executive officers and secretaries
of the Company, and directors and officers, including executive officers and secretaries, of its controlled entities.
Disclosure of the nature of the liabilities covered and the amount of the premium is prohibited under the conditions of
the contract of insurance.

52 Directors Report

13. Non-audit services
During the financial year KPMG, the Companys auditor, has performed certain other services in addition to their
statutory duties.
The Board has considered the nonaudit services provided during the year by the auditor and in accordance with
advice provided by the Audit, Risk Management and Compliance Committee, is satisfied that the provision of those
nonaudit services during the year by the auditor is compatible with, and did not compromise, the auditor independence
requirements of the Corporations Act 2001 for the following reasons:
all non-audit services are subject to the corporate governance procedures adopted by the Company and are
reviewed by the Audit, Risk Management and Compliance Committee to ensure they do not impact the integrity and
objectivity of the auditor; and
the non-audit services provided do not undermine the general principles relating to auditor independence as set out
in Professional Statement F1 Professional Independence, as they do not involve reviewing or auditing the auditors
own work, acting in a management or decision making capacity for the Company, acting as an advocate for the
Company or jointly sharing risks and rewards.
Details of the amounts paid to the auditor of the Company, KPMG, and its related practices for audit and non-audit
services provided during the year are set out below:

Consolidated
2014 2013
Audit services $ $
Auditors of the Company
KPMG Australia:
Audit 206,400 209,905
Tax services
Auditors of the Company
KPMG Australia:
Income tax - 10,123
Research & development taxation advice - 16,890
Other services
Auditors of the Company
KPMG Australia:
Due diligence services - 6,000
KPMG Italy:
Due diligence services 40,650 -

Genea Limited Annual Report 2014 53

Directors Report (cont.)
14. Lead auditors independence declaration
The lead auditors independence declaration is set out on page 48 (page110 of this Annual Report) and forms part of
the Directors report for financial year ended 30 June 2014.

15. Rounding off

The Group is of a kind referred to in ASIC Class Order 98/100 dated 10 July 1998 and in accordance with that Class
Order, amounts in the consolidated financial statements and directors report have been rounded off to the nearest
thousand dollars, unless otherwise stated.
This report is made in accordance with a resolution of the Directors:

R.A. Ross AM T. Stojanov

Chairman Chief Executive Officer

Dated at Sydney this 17th day of September 2014

54 Directors Report

Statement of Financial Position
As at 30 June 2014
Consolidated
In AUD ($000) Note 2014 2013
Assets
Cash and cash equivalents 13a 844 5,443
Trade and other receivables 14 2,584 2,660
Other assets 15 3,374 1,692
Income tax receivable 18 395 1,908
Total current assets 7,197 11,703
Receivables 14 619 -
Investments in equity accounted investees 16 4,341 3,186
Deferred tax assets 18 2,703 -
Property, plant and equipment 19 15,996 15,199
Intangible assets 20 21,100 17,094
Total non-current assets 44,759 35,479
Total assets 5 51,956 47,182

Liabilities
Trade and other payables 21 5,525 5,816
Other liabilities 22 2,434 2,841
Loans and borrowings 23 1,431 8
Employee benefits 24 3,392 3,721
Provisions 25 211 -
Total current liabilities 12,993 12,386
Deferred tax liabilities 18 - 1,442
Other liabilities 22 3,558 4,322
Loans and borrowings 23 4,000 12
Employee benefits 24 758 677
Provisions 25 1,253 1,415
Total non-current liabilities 9,569 7,868
Total liabilities 5 22,562 20,254
Net assets 29,394 26,928

Equity
Share capital 10,309 10,107
Equity compensation reserve 163 140
Translation reserve 76 215
Retained earnings 18,127 15,554
Total equity attributable to equity holders of the Company 28,675 26,016
Non-controlling interest 719 912
Total equity 29,394 26,928
The notes on pages 59 to 107 are an integral part of these consolidated financial statements.

Genea Limited Annual Report 2014 55

Statement of Profit or Loss and
Other Comprehensive Income
For the year ended 30 June 2014
Consolidated
In AUD ($000) Note 2014 2013
Revenue 5 76,259 73,442
Cost of goods and services sold (38,092) (35,233)
Gross profit 38,167 38,209
Other income 6 468 394
Sales and marketing expenses (4,433) (3,148)
Research and development expenses 10 (4,175) (6,473)
Administrative expenses (28,056) (25,048)
Results from operating activities 1,971 3,934
Financial income 30 148
Financial expenses (141) (7)
Net financing (expense)/income 9 (111) 141

Share of profit of equity accounted investees 16 1,443 1,581

Profit before income tax 3,303 5,656

Income tax expense/(benefit) 11 2,100 (334)

Profit for the year 5,403 5,322

Other comprehensive income

Items that may be reclassified subsequently to profit or loss:
Foreign currency (loss)/gain for foreign operations (139) 195
Total comprehensive income for the year 5,264 5,517

Profit attributable to:

Equity holders of the Company 4,936 4,883
Non-controlling interest 467 439
Profit for the year 5,403 5,322

Total comprehensive income attributable to:

Equity holders of the Company 4,797 5,078
Non-controlling interest 467 439
Total comprehensive income for the year 5,264 5,517

Earnings per share:

Basic earnings per share 12 1.73 1.73
Diluted earnings per share 12 1.73 1.71
The notes on pages 59 to 107 are an integral part of these consolidated financial statements.

56 Financial Report

Statement of Changes in Equity
For the year ended 30 June 2014
Consolidated
Equity Non-
Share Translation compensation Retained controlling Total
In AUD ($000) capital reserve reserve earnings Total interest equity

Balance at 1 July 2012 9,071 20 287 16,217 25,595 1,514 27,109

Total comprehensive income for the year
Profit - - - 4,883 4,883 439 5,322
Total other comprehensive income - 195 - - 195 - 195
- 195 - 4,883 5,078 439 5,517
Transactions with equity holders, recorded directly in equity
Contributions by and (distributions to) equity holders
Share options exercised 502 - - - 502 - 502
Equity-settled transactions, net of tax - - (29) - (29) - (29)
Transfers 118 - (118) - - - -
Reduction in pre-acquisition reserve
- - - - - (273) (273)
arising from acquisition
Shares issued 416 - - - 416 - 416
Dividends paid - - - (5,546) (5,546) (768) (6,314)
Total contributions by and
1,036 - (147) (5,546) (4,657) (1,041) (5,698)
(distributions to) equity holders
Balance at 30 June 2013 10,107 215 140 15,554 26,016 912 26,928

Balance at 1 July 2013 10,107 215 140 15,554 26,016 912 26,928
Total comprehensive income for the year
Profit - - - 4,936 4,936 467 5,403
Total other comprehensive income - (139) - - (139) - (139)
- (139) - 4,936 4,797 467 5,264
Transactions with equity holders, recorded directly in equity
Contributions by and (distributions to) equity holders
Share options exercised 6 - - - 6 - 6
Equity-settled transactions, net of tax - - 23 - 23 - 23
Shares issued 196 - - - 196 - 196
Dividends paid - - - (2,363) (2,363) (660) (3,023)
Total contributions by and 202 - 23 (2,363) (2,138) (660) (2,798)
(distributions to) equity holders
Balance at 30 June 2014 10,309 76 163 18,127 28,675 719 29,394
The notes on pages 59 to 107 are an integral part of these consolidated financial statements.

Genea Limited Annual Report 2014 57

Statement of Cash Flows
For the year ended 30 June 2014
Consolidated
In AUD ($000) Note 2014 2013
Cash flows from operating activities
Cash receipts from customers 76,635 72,432
Cash paid to suppliers and employees (73,529) (63,383)
Cash generated from operations 3,106 9,049
Interest paid (48) (6)
Interest received 30 148
Dividends received 640 656
Income taxes paid (504) (823)
Net cash from operating activities 13b 3,224 9,024
Cash flows from investing activities
Proceeds on disposal of property, plant and equipment - 46
Acquisition of property, plant and equipment 19 (4,121) (2,683)
Development expenditure 20 (5,802) (4,399)
Acquisition of investments (505) (1,529)
Net cash used in investing activities (10,428) (8,565)
Cash flows from financing activities
Proceeds from the issue of share capital 202 918
Proceeds from drawdown/(repayment) of loans and borrowings 5,426 (6)
Distributions to non-controlling interests (660) (768)
Dividends paid 26 (2,363) (5,546)
Net cash from/(used in) financing activities 2,605 (5,402)
Net decrease in cash and cash equivalents (4,599) (4,943)
Cash and cash equivalents at 1 July 5,443 10,386
Cash and cash equivalents at 30 June 13a 844 5,443

The notes on pages 59 to 107 are an integral part of these consolidated financial statements.

58 Financial Report

Notes to the Consolidated
Financial Statements
Index To Notes to the Consolidated Financial Statements
1. Reporting entity
2. Basis of preparation
3. Significant accounting policies
a. Basis of consolidation
b. Foreign currency
c. Financial instruments
d. Property, plant and equipment
e. Intangible assets
f. Trade and other receivables
g. Other assets
h. Cash and cash equivalents
i. Impairment
j. Interest-bearing borrowings
k. Employee benefits
l. Provisions
m. Trade and other payables
n. Non-controlling interest
o. Revenue
p. Lease payments
q. Finance income and expenses
r. Income tax
s. Earnings per share
t. Segment reporting
u. Goods and services tax
v. New standards and interpretations not yet
adopted
Genea Limited Annual Report 2014
4. Determination of fair values
5. Operating segments
6. Other income
7. Other expenses
8. Auditors remuneration
9. Finance income and expenses
10. Research and development expenditure
11. Income tax expense
12. Earnings per share
13 a. Cash and cash equivalents
b. Reconciliation of cash flows from operating
activities
14. Trade and other receivables
15. Other assets
16. Investments in equity accounted investees
17. Group entities and non-controlling interest
18. Tax assets and liabilities
19. Property, plant and equipment
20. Intangible assets
21. Trade and other payables
22. Other liabilities
23. Loans and borrowings
24. Employee benefits
25. Provisions
26. Capital and reserves
27. Financial instruments
28. Operating leases
29. Capital and other commitments
30. Contingencies
31. Related party transactions
32. Subsequent events
33. Company disclosures
59
Notes to the Consolidated
Financial Statements
1. Reporting entity
Genea Limited (the Company) is a company domiciled
in Australia. The address of the Companys registered
office is 321 Kent Street, Sydney. The consolidated
financial statements of the Company as at and for the
year ended 30 June 2014 comprise the Company and its
subsidiaries (together referred to as the Group) and the
Groups interest in associates. The Group is a for-profit
entity and primarily is involved in the provision of assisted
reproductive technology (ART) services and research
and development in the field of reproductive science and
medicine, including the commercialisation of research and
development outcomes (see note 10).
2. Basis of preparation
(a) Statement of compliance
The consolidated financial statements are general
purpose financial statements which have been prepared
in accordance with Australian Accounting Standards
(AASBs) (including Australian Interpretations) adopted
by the Australian Accounting Standards Board (AASB)
and the Corporations Act 2001. The consolidated
financial statements comply with International Financial
Reporting Standards (IFRSs) adopted by the International
Accounting Standards Board (IASB).
The consolidated financial statements were authorised for
issue by the directors on 17 September 2014.
(b) Basis of measurement
The consolidated financial statements have been
prepared on an historical cost basis.
(c) Functional and presentation currency
These consolidated financial statements are presented
in Australian dollars, which is the Companys functional
currency and the functional currency of the majority of
the Group.
60
The Group is of a kind referred to in ASIC Class Order
98/100 dated 10 July 1998 and in accordance with
that Class Order, amounts in the consolidated financial
statements and directors report have been rounded off to
the nearest thousand dollars, unless otherwise stated.
(d) Use of estimates and judgements
The preparation of financial statements requires
management to make judgements, estimates and
assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from
these estimates.
Estimates and underlying assumptions are reviewed on
an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised
and in any future periods affected.
(e) Changes in accounting policies
Except for the changes below, the Group has consistently
applied the accounting policies set out in Note 3 to
all periods presented in these consolidated financial
statements.
The Group has adopted the following new standards and
amendments to standards, including any consequential
amendments to other standards, with a date of initial
application of 1 July 2013.
a) AASB 10 Consolidated Financial Statements (2011)
b) AASB 11 Joint Arrangements
c) AASB 12 Disclosure of Interests in Other Entities
d) AASB 13 Fair Value Measurement
e) AASB 119 Employee Benefits (2011)
The nature and effects of the changes are explained
below.
Notes to the Consolidated Financial Statements
(i) Subsidiaries
As a result of AASB 10 (2011), the Group has changed
its accounting policy for determining whether it has
control over and consequently whether it consolidates
its investees. AASB 10 (2011) introduces a new control
model that focuses on whether the Group has power over
an investee, exposure or rights to variable returns from its
involvement with the investee and ability to use its power
to affect those returns.
In accordance with the transitional provisions of AASB 10
(2011), the Group reassessed the control conclusion for
its investees at 1 July 2013. The application of AASB 10
(2011) had no impact on the recognised assets, liabilities
and comprehensive income of the Group.
(ii) Joint arrangements
As a result of AASB 11, the Group has changed its
accounting policy for its interests in joint arrangements.
Under AASB 11, the Group has classified its interests
in joint arrangements as either joint operations (if the
Group has rights to the assets, and obligations for the
liabilities, relating to an arrangement) or joint ventures
(if the Group has rights only to the net assets of an
arrangement). When making this assessment, the Group
considered the structure of the arrangements, the legal
form of any separate vehicles, the contractual terms of
the arrangements and other facts and circumstances.
Previously, the structure of the arrangement was the sole
focus of classification.
The Group has re-evaluated its involvement in its joint
ventures and this has not resulted in any reclassifications.
The investments continue to be recognised by applying
the equity method and there has been no impact on the
recognised assets, liabilities and comprehensive income
of the Group.
Genea Limited Annual Report 2014
(iii) Disclosure of interests in other entities
As a result of AASB 12, the Group would be required to
expand its disclosures about its interests in subsidiaries
and equity-accounted investees in certain circumstances
such as when the Group has greater than 50% ownership
interest and the entity is not consolidated. There are
currently no instances in the Group therefore this
change had no impact on the disclosures in the financial
statements.
(iv) Fair value measurement
AASB 13 establishes a single framework for measuring
fair value and making disclosures about fair value
measurements when such measurements are required
or permitted by other AASBs. It unifies the definition of
fair value as the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date.
It replaces and expands the disclosure requirements
about fair value measurements in other AASBs, including
AASB 7. As a result, the Group has included additional
disclosures in this regard (see Note 27).
In accordance with the transitional provisions of
AASB 13, the Group has applied the new fair value
measurement guidance prospectively and has not
provided any comparative information for new disclosures.
Notwithstanding the above, the change had no significant
impact on the measurements of the Groups assets and
liabilities.
(v) Employee benefits Annual leave
As a result of AASB 119 (2011), the Group changed its
accounting policy in respect of employee benefits with
the adoption of AASB 119 Employee Benefits. One of the
impacts of this change is that annual leave has changed
from a short-term employee benefit to a long-term
employee benefit. Notwithstanding the above, the
change had no significant impact on the measurements
of the Groups assets and liabilities.
61
Notes to the Consolidated
Financial Statements (cont.)
3. Significant accounting policies
Certain comparative amounts in the consolidated
statement of profit or loss and other comprehensive
income have been reclassified to conform with the
current years presentation (see Note 10). In addition,
comparative amounts in Note 5 have been restated to
reflect the reportable segments recognised from
1 July 2013.
The Group has elected not to early adopt any accounting
standards.
(a) Basis of consolidation
(i) Business combinations
The Group accounts for business combinations using
the acquisition method when control is transferred to
the Group (see (a)(iii)). The consideration transferred in
the acquisition is generally measured at fair value, as are
the identifiable net assets acquired. Any goodwill that
arises is tested annually for impairment (see 3(e)(i)). Any
gain on a bargain purchase is recognised in profit or loss
immediately. Transaction costs are expensed as incurred,
except if related to the issue of debt or equity securities
(see 3(c)).
The consideration transferred does not include amounts
related to the settlement of pre-existing relationships.
Such amounts are generally recognised in profit or loss.
Any contingent consideration payable is measured
at fair value at the acquisition date. If the contingent
consideration is classified as equity, then it is not
remeasured and settlement is accounted for within equity.
Otherwise, subsequent changes in the fair value of the
contingent consideration are recognised in profit or loss.
(ii) Non-controlling interests (NCI)
NCI are measured at their proportionate share of the
acquirees identifiable net assets at the acquisition date.
Changes in the Groups interest in a subsidiary that do
not result in a loss of control are accounted for as equity
transactions.
62
(iii) Subsidiaries
Subsidiaries are entities controlled by the Group. The
Group controls an entity when it is exposed to, or has
rights to, variable returns from its involvement with the
entity and has the ability to affect those returns through
its power over the entity. The financial statements of
subsidiaries are included in the consolidated financial
statements from the date on which control commences
until the date on which control ceases.
(iv) Loss of control
When the Group loses control over a subsidiary, it
derecognises the assets and liabilities of the subsidiary,
and any related NCI and other components of equity. Any
resulting gain or loss is recognised in profit or loss. Any
interest retained in the former subsidiary is measured at
fair value when control is lost.
(v) Investments in equity-accounted investees
The Groups interests in equity-accounted investees
comprise interests in associates and joint ventures.
Associates are those entities in which the Group has
significant influence, but not control or joint control, over
the financial and operating policies. A joint venture is
an arrangement in which the Group has joint control,
whereby the Group has rights to the net assets of
the arrangement, rather than rights to its assets and
obligations for its liabilities.
Interests in associates and joint ventures are accounted
for using the equity method. They are recognised initially
at cost, which includes transaction costs. Subsequent to
initial recognition, the consolidated financial statements
include the Groups share of the profit or loss and other
comprehensive income of equity-accounted investees,
until the date on which significant influence or joint
control ceases.
Notes to the Consolidated Financial Statements
(vi) Transactions eliminated on consolidation
Intra-group balances and transactions, and any
unrealised income and expenses arising from intra-group
transactions, are eliminated. Unrealised gains arising
from transactions with equity-accounted investees are
eliminated against the investment to the extent of the
Groups interest in the investee. Unrealised losses are
eliminated in the same way as unrealised gains, but only
to the extent that there is no evidence of impairment.
(b) Foreign currency
(i) Foreign currency transactions
Transactions in foreign currencies are translated to
the respective functional currencies of Group entities
at exchange rates at the dates of the transactions.
Monetary assets and liabilities denominated in foreign
currencies at the reporting date are retranslated to the
functional currency at the foreign exchange rate at that
date. The foreign currency gain or loss on monetary
items is the difference between amortised cost in the
functional currency at the beginning of the period,
adjusted for effective interest and payments during
the period, and the amortised cost in foreign currency
translated at the exchange rate at the end of the period.
Non-monetary assets and liabilities denominated in
foreign currencies that are measured at fair value are
retranslated to the functional currency at the exchange
rate at the date that the fair value was determined.
Foreign currency differences arising on retranslation are
recognised in the statement of profit or loss and other
comprehensive income.
(ii) Foreign operations
The assets and liabilities of foreign operations, including
goodwill and fair value adjustments arising on acquisition,
are translated to Australian dollars at exchange rates
at the reporting date. The income and expenses of
foreign operations are translated to Australian dollars at
exchange rates at the dates of the transactions.
Genea Limited Annual Report 2014
Foreign currency differences are recognised directly
in other comprehensive income, and presented in the
translation reserve in equity. When a foreign operation is
disposed of, in part or in full, the relevant amount in the
translation reserve is transferred to the statement of profit
or loss and other comprehensive income.
(c) Financial Instruments
(i) Non-derivative financial instruments
Non-derivative financial assets
Non-derivative financial assets comprise trade and
other receivables and cash and cash equivalents. Cash
and cash equivalents comprise cash balances and call
deposits.
The Group initially recognises loans and receivables and
deposits on the date that they are originated. All other
financial assets (including assets designated at fair
value through the statement of profit or loss and other
comprehensive income) are recognised initially on the
trade date at which the Group becomes a party to the
contractual provisions of the instrument. Subsequent
to initial recognition non-derivative financial assets are
measured as described below.
The Group derecognises a financial asset when the
contractual rights to the cash flows from the asset expire,
or it transfers the rights to receive the contractual cash
flows on the financial asset in a transaction in which
substantially all the risks and rewards of the ownership
of the financial asset are transferred. Any interest in
transferred financial assets that is created or retained by
the Group is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net
amount presented in the statement of financial position
when, and only when, the Group has a legal right to offset
the amounts and intends either to settle on a net basis or
to realise the asset and settle the liability simultaneously.
63
Notes to the Consolidated
Financial Statements (cont.)
Loans and receivables
Loans and receivables are financial assets with fixed
or determinable payments that are not quoted in an
active market. Such assets are recognised initially at
fair value plus any directly attributable transaction costs.
Subsequent to initial recognition loans and receivables
are measured at amortised cost using the effective
interest method, less any impairment losses.
Non-derivative financial liabilities
The Group initially recognises debt securities issued
and subordinated liabilities on the date that they are
originated. All other financial liabilities (including liabilities
designated at fair value through the statement of profit
or loss and other comprehensive income) are recognised
initially on the trade date at which the Group becomes a
party to the contractual provisions of the instrument.
Non-derivative financial liabilities comprise trade and
other payables and loans and borrowings. Such financial
liabilities are recognised initially at fair value plus any
directly attributable transaction costs. Subsequent to
initial recognition these financial liabilities are measured
at amortised cost using the effective interest rate method.
The Group derecognises a financial liability when its
contractual obligations are discharged or cancelled
or expire.
Financial assets and liabilities are offset and the net
amount presented in the statement of financial position
when, and only when, the Group has a legal right to offset
the amounts and intends either to settle on a net basis or
to realise the asset and settle the liability simultaneously.
Other
Accounting for finance income and expense is discussed
in note 3(q).
(ii) Share Capital
Ordinary shares
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of ordinary shares and
64
share options are recognised as a deduction from equity,
net of any tax effects.
Dividends
Dividends are recognised as a liability in the period in
which they are declared.
Transaction costs
Transaction costs of an equity transaction are accounted
for as a deduction from equity, net of any related income
tax benefit.
(d) Property, plant and equipment
(i) Owned assets
Items of property, plant and equipment are stated at cost
or deemed cost less accumulated depreciation (see
below) and impairment losses (see accounting policy 3(i)).
Cost includes expenditures that are directly attributable to
the acquisition of the asset. The cost of self-constructed
assets includes the cost of materials and direct labour,
any other costs directly attributable to bringing the asset
to a working condition for its intended use, and the costs
of dismantling and removing the items and restoring the
site on which they are located. Purchased software that
is integral to the functionality of the related equipment is
capitalised as part of that equipment.
Where parts of an item of property, plant and equipment
have different useful lives, they are accounted for as
separate items of property, plant and equipment.
Gains and losses on disposal of an item of property,
plant and equipment are determined by comparing the
proceeds from disposal with the carrying amount of
property, plant and equipment and are recognised in
the statement of profit or loss and other comprehensive
income.
(ii) Leased and hire purchase assets
Leases and hire purchases of which the Group assumes
substantially all the risks and rewards of ownership are
classified as finance leases. Upon initial recognition
Notes to the Consolidated Financial Statements
the lease or hire purchased asset is measured at an
amount equal to the lower of its fair value and the present
value of minimum lease payments. Subsequent to initial
recognition, the asset is accounted for in accordance with
the accounting policy applicable to that asset.
Other leases are operating leases and the leased assets
are not recognised on the Groups statement of financial
position.
(iii) Subsequent costs
The cost of replacing part of an item of property, plant
and equipment is recognised in the carrying amount
of the item if it is probable that the future economic
benefits embodied within the part will flow to the Group
and its cost can be measured reliably. The costs of the
day-to-day servicing of property, plant and equipment are
recognised in the statement of profit or loss and other
comprehensive income as incurred.
(iv) Depreciation
Depreciation is recognised in the statement of profit or
loss and other comprehensive income on a straight-line
basis over the estimated useful lives of each part of an
item of property, plant and equipment. Leased assets are
depreciated over the shorter of the lease term and their
useful lives.
The estimated useful lives in the current and comparative
period are as follows:
Plant and equipment 3 - 10 years
Leasehold improvements 2 - 15 years
Depreciation methods, useful lives and residual values are
reassessed at the reporting date.
(e) Intangible assets
(i) Goodwill
Goodwill, or negative goodwill, arises on the acquisition of
subsidiaries, associates and joint ventures.
Genea Limited Annual Report 2014
Goodwill represents the excess of the cost of the
acquisition over the Groups interest in the net fair value of
the identifiable assets, liabilities and contingent liabilities
of the acquiree. When the excess is negative (negative
goodwill), it is recognised immediately in the statement of
profit or loss and other comprehensive income.
Upon disposal of an underlying asset or cash generating
unit to which goodwill relates, the associated goodwill is
disposed of as part of the transaction.
Subsequent measurement
Goodwill is measured at cost less accumulated
impairment losses. In respect of equity accounted
investees, the carrying amount of goodwill is included in
the carrying amount of the investment.
(ii) Research and development
Expenditure on research activities, undertaken with the
prospect of gaining new scientific or technical knowledge
and understanding, is recognised in the statement of
profit or loss and other comprehensive income as an
expense as incurred.
Development activities involve a plan or design for the
production of new or substantially improved products and
processes. Development expenditure is capitalised only
if development expenditure can be measured reliably,
the product or process is technically and commercially
feasible, future economic benefits are probable, and
the Group intends to and has sufficient resources to
complete development and to use or sell the asset. The
expenditure capitalised includes the cost of materials,
direct labour and overhead costs that are directly
attributable to preparing the asset for its intended use.
Other development expenditure is recognised in the
statement of profit or loss and other comprehensive
income when incurred.
Capitalised development expenditure is measured at
cost less accumulated amortisation and accumulated
impairment losses.
65
Notes to the Consolidated
Financial Statements (cont.)
(iii) Other intangible assets
Other intangible assets that are acquired by the Group,
which have finite useful lives, are measured at cost less
accumulated amortisation and accumulated impairment
losses (see accounting policy 3(i)).
(iv) Amortisation
Amortisation is calculated over the cost of the asset,
or any other amount substituted for cost, less its
residual value.
Amortisation is recognised in the statement of profit or
loss and other comprehensive income on a straight-line
basis over the estimated useful lives of intangible
assets, other than goodwill, from the date they are
available for use.
Amortisation methods, useful lives and residual values
are reviewed at each financial year-end and adjusted if
appropriate.
(f) Trade and other receivables
Trade and other receivables are stated at their amortised
cost less impairment losses (see accounting policy 3(i)).
(g) Other assets
(i) Supplies and spares
Supplies and spares are measured at cost.
(h) Cash and cash equivalents
Cash and cash equivalents comprise cash balances,
short term bills and call deposits. Bank overdrafts that
are repayable on demand and form an integral part of the
Groups cash management are included as a component
of cash and cash equivalents for the purpose of the
statement of cash flows.
(i) Impairment cash-generating units are allocated first to reduce the
(i) Financial assets
A financial asset is assessed at each reporting date
to determine whether there is any objective evidence
that it is impaired. A financial asset is considered to be
66
impaired if objective evidence indicates that one or more
events have had a negative effect on the estimated
future cash flows of that asset. An impairment loss in
respect of a financial asset measured at amortised cost
is calculated as the difference between its carrying
amount, and the present value of the estimated future
cash flows discounted at the original effective interest
rate. Individually significant financial assets are tested for
impairment on an individual basis. The remaining financial
assets are assessed collectively in groups that share
similar credit risk characteristics. All impairment losses
are recognised in the statement of profit or loss and other
comprehensive income. An impairment loss is reversed
if the reversal can be related objectively to an event
occurring after the impairment loss was recognised. For
financial assets measured at amortised cost the reversal
is recognised in the statement of profit or loss and other
comprehensive income.
(ii) Non-financial assets
The carrying amounts of the Groups non-financial
assets, other than inventories and deferred tax assets,
are reviewed at each reporting date to determine
whether there is any indication of impairment. If any such
indication exists then the assets recoverable amount is
estimated. For goodwill and intangible assets that have
indefinite lives or that are not yet available for use, the
recoverable amount is estimated at each reporting date.
An impairment loss is recognised if the carrying amount
of an asset or its cash-generating unit exceeds its
recoverable amount. A cash-generating unit is the
smallest identifiable asset group that generates cash
flows that largely are independent from other assets
and groups. Impairment losses are recognised in the
statement of profit or loss and other comprehensive
income. Impairment losses recognised in respect of
carrying amount of any goodwill allocated to the units and
then to reduce the carrying amount of the other assets in
the unit (group of units) on a pro rata basis.
Notes to the Consolidated Financial Statements
The recoverable amount of an asset or cash-generating
unit is the greater of its value in use and its fair value
less costs to sell. In assessing value in use, the estimated
future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks
specific to the asset. For the purpose of impairment
testing, assets are grouped together into the smallest
group of assets that generates cash inflows from
continuing use that are largely independent of the
cash inflows of other assets or groups of assets (the
cash-generating unit). The goodwill acquired in a business
combination, for the purpose of impairment testing, is
allocated to cash-generating units that are expected to
benefit from the synergies of the combination.
An impairment loss in respect of goodwill is not reversed.
In respect of other assets, impairment losses recognised
in prior periods are assessed at each reporting date
for any indications that the loss has decreased or no
longer exists. An impairment loss is reversed if there
has been a change in the estimates used to determine
the recoverable amount. An impairment loss is reversed
only to the extent that the assets carrying amount does
not exceed the carrying amount that would have been
determined, net of depreciation or amortisation, if no
impairment loss had been recognised.
(j) Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at fair
value less attributable transaction costs. Subsequent to
initial recognition, interest-bearing borrowings are stated
at amortised cost with any difference between cost and
redemption value being recognised in the statement of
profit or loss and other comprehensive income over the
period of the borrowings on an effective interest basis.
(k) Employee benefits
(i) Defined contribution superannuation funds
A defined contribution plan is a post-employment benefit
plan under which an entity pays fixed contributions into
Genea Limited Annual Report 2014
a separate entity and will have no legal or constructive
obligation to pay further amounts. Obligations for
contributions to defined contribution plans are recognised
as a personnel expense in the statement of profit or loss
and other comprehensive income during which services
are rendered by personnel. Prepaid contributions are
recognised as an asset to the extent that a cash refund or
a reduction in future payments is available.
(ii) Other long-term employee benefits
The Groups net obligation in respect of long-term
employee benefits is the amount of future benefit that
employees have earned in return for their service in
the current and prior periods plus related on costs; that
benefit is discounted to determine its present value,
and the fair value of any related assets is deducted.
The discount rate is the yield at the reporting date on
Commonwealth Government bonds that have maturity
dates approximating the terms of the Groups obligations.
The calculation is performed using the projected
unit credit method. Any actuarial gains or losses are
recognised in the statement of profit or loss and other
comprehensive income in the period in which they arise.
(iii) Termination benefits
Termination benefits are recognised as an expense when
the Group is demonstrably committed, without realistic
possibility of withdrawal, to a formal detailed plan to
terminate employment before the normal retirement
date. Termination benefits for voluntary redundancies are
recognised if the Group has made an offer encouraging
voluntary redundancy, it is probable that the offer will
be accepted, and the number of acceptances can be
estimated reliably.
(iv) Short-term benefits
Liabilities for employee benefits for wages, salaries,
annual leave and sick leave represent present obligations
resulting from employees services provided to the
reporting date and are calculated at undiscounted
amounts based on remuneration wage and salary rates
67
Notes to the Consolidated
Financial Statements (cont.)
that the Group expects to pay as at the reporting date
including related on-costs, such as workers compensation
insurance and payroll tax. Non-accumulating
non-monetary benefits are expensed based on the net
marginal cost to the Group as the benefits are taken by
the employees.
A provision is recognised for the amount expected to be
paid under short-term cash bonus or profit-sharing plans
if the Group has a present legal or constructive obligation
to pay this amount as a result of past service provided by
the employee and the obligation can be estimated reliably.
(v) Share-based payment transactions
The grant date fair value of share-based payment awards
granted to employees is recognised as an employee
expense, with a corresponding increase in equity, over the
period in which the employees become unconditionally
entitled to the awards. The amount recognised is adjusted
to reflect the number of awards for which the related
service conditions and nonmarket vesting conditions
are anticipated to be met, such that the amount ultimately
recognised as an expense is based on the number of
awards that meet the related service and nonmarket
performance conditions at the vesting date.
(l) Provisions
A provision is recognised if, as a result of a past event,
the Group has a present legal or constructive obligation
that can be estimated reliably, and it is probable that an
outflow of economic benefits will be required to settle the
obligation. Provisions are determined by discounting the
expected future cash flows at a pre-tax rate that reflects
current market assessments of the time value of money
and the risks specific to the liability. The unwinding of the
discount is recognised as a finance cost.
(i) Premises make good
The provision for premises make good represents the
best estimate of the present value of the expenditure
required to remediate the premises in accordance with
the relevant lease agreement.
68
(m) Trade and other payables
Trade and other payables are stated at their amortised cost.
(n) Non-controlling interest
The Group measures any non-controlling interest at its
proportionate interest in the identifiable net assets of the
subsidiaries.
(o) Revenue
(i) Services rendered
Revenue from services rendered is recognised in the
statement of profit or loss and other comprehensive
income on completion of the service. No revenue is
recognised if there are significant uncertainties regarding
recovery of the consideration due.
The Group provides ART services and facilities to
accredited doctors and their patients. The Group has
primary responsibility for providing the ART services to
those patients, excluding only the clinical components
which by law must be provided by a medical practitioner.
Under the terms of billing arrangements between the
Group and its accredited doctors, the Group bears
the credit risk for the amount receivable from patients
and pays to the doctors fees for the component of the
service they provide. Accordingly revenue is stated at its
gross amount before deducting related expenses which
includes the fees payable to doctors for the component of
the service they provide.
(ii) Rental income
Rental income is recognised in the statement of profit
or loss and other comprehensive income on a straight
line basis over the term of the lease. Rental income from
subleased property is recognised as other income.
(iii) Royalty income
Royalty revenue is recognised in the statement of profit or
loss and other comprehensive income when the Group is
entitled to its receipt and it can be reliably measured.
Notes to the Consolidated Financial Statements
(iv) Deferred income
If payments received from customers exceed the income
recognised or in advance of any work performed, then the
difference is presented as deferred income, disclosed in
the statement of financial position in other liabilities.
Where government grants received in prior years relate
to development expenditure capitalised, they have been
deferred and will be recognised in the statement of profit
or loss and other comprehensive income as revenue on a
systematic basis in the same periods in which the related
development expenditure will be amortised.
(vi) Dividend income
Dividend income is recognised on the date that the
Groups right to receive payment is established.
(p) Lease payments
Payments made under operating leases are recognised in
the statement of profit or loss and other comprehensive
income on a straight-line basis over the term of the lease.
Lease incentives received are deferred to other liabilities
and recognised as an integral part of the total lease
expense, over the term of the lease.
Minimum lease payments made under finance leases
are apportioned between the finance expense and the
reduction of the outstanding liability. The finance expense
is allocated to each period during the lease term so
as to produce a constant periodic rate of interest on
the remaining balance of the liability. Contingent lease
payments are accounted for by revising the minimum
lease payments over the remaining term of the lease
when the lease adjustment is confirmed.
At inception of an arrangement, the Group determines
whether such an arrangement is or contains a lease. A
specific asset is the subject of a lease if fulfilment of the
arrangement is dependent on the use of that specified
asset. An arrangement conveys the right to use the
asset if the arrangement conveys to the Group the right
to control the use of the underlying asset. At inception
or upon reassessment of the arrangement, the Group
Genea Limited Annual Report 2014
separates payments and other consideration required
by such an arrangement into those for the lease and
those for other elements on the basis of their relative fair
values. If the Group concludes for a finance lease that
it is impracticable to separate the payments reliably, an
asset and a liability are recognised at an amount equal to
the fair value of the underlying asset. Subsequently the
liability is reduced as payments are made and an imputed
finance charge on the liability is recognised using the
Groups incremental borrowing rate.
(q) Finance income and expenses
Finance income comprises interest income on funds
invested, changes in the fair value of financial assets
recognised through the statement of profit or loss and
other comprehensive income, and foreign currency gains.
Interest income is recognised as it accrues, using the
effective interest method.
Finance expense comprises interest expense on
borrowings, unwinding of the discount on provisions,
foreign currency losses, changes in the fair value of
financial assets recognised through the statement of
profit or loss and other comprehensive income, and
impairment losses recognised on financial assets. All
borrowing costs are recognised in the statement of
profit or loss and other comprehensive income using the
effective interest method.
Foreign currency gains and losses are reported on a net
basis.
(r) Income tax
Income tax expense comprises current and deferred tax.
Income tax expense is recognised in the statement of
profit or loss and other comprehensive income except to
the extent that it relates to items recognised directly in
equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable
income for the year, using tax rates enacted or
substantively enacted at the reporting date, and any
adjustment to tax payable in respect of previous years.
69
Notes to the Consolidated
Financial Statements (cont.)
In determining the amount of current and deferred tax
the Group takes into account the impact of uncertain
tax positions and whether additional taxes and interest
may be due. The Group believes that its accruals for tax
liabilities and receivables are adequate for all open tax
years based on its assessment of many factors, including
interpretations of tax law and prior experience. This
assessment relies on estimates and assumptions and
may involve a series of judgments about future events.
New information may become available that causes the
Group to change its judgment regarding the adequacy of
existing tax liabilities and receivables; such changes to tax
liabilities and receivables will impact tax expense in the
period that such a determination is made.
Deferred tax is recognised using the balance sheet
method, providing for temporary differences between
the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation
purposes. Deferred tax is not recognised for the
following temporary differences: the initial recognition
of goodwill, the initial recognition of assets or liabilities
in a transaction that is not a business combination and
that affects neither accounting nor taxable profit, and
differences relating to investments in subsidiaries and
jointly controlled entities to the extent that they probably
will not reverse in the foreseeable future. Deferred tax is
measured at the tax rates that are expected to be applied
to the temporary differences when they reverse, based on
the laws that have been enacted or substantively enacted
by the reporting date.
A deferred tax asset is recognised for unutilised tax
losses, tax credits and deductible temporary differences
to the extent that it is probable that future taxable profits
will be available against which they can be utilised.
Deferred tax assets are reviewed at each reporting date
and are reduced to the extent that it is no longer probable
that the related tax benefit will be realised.
The Company and its wholly-owned Australian resident
entities are part of a tax-consolidated group with effect
from 1 July 2012. As a consequence, all members of the
tax-consolidated group are taxed as a single entity. The
70
head entity within the tax-consolidated group is Genea
Limited.
(s) Earnings per share
The Group presents basic and diluted earnings per share
(EPS) data for its ordinary shares. Basic EPS is calculated
by dividing the profit or loss attributable to ordinary
shareholders of the Company by the weighted average
number of ordinary shares outstanding during the period.
Diluted EPS is determined by adjusting the profit or loss
attributable to ordinary shareholders and the weighted
average number of ordinary shares outstanding for the
effects of all dilutive potential ordinary shares, which
comprise convertible notes and share options granted to
employees.
(t) Segment reporting
An operating segment is a distinguishable component of
the Group that is engaged in providing related products
or services, which is subject to risks and rewards that
are different from those of other segments. A segment
engages in business activities from which it may earn
revenues and incur expenses. All operating segments
operating results are regularly reviewed to make
decisions about resources to be allocated to the segment
and assess its performance, and for which discrete
financial information is available.
Segment results, assets and liabilities include items
directly attributable to a segment as well as those that
can be allocated on a reasonable basis. Unallocated items
comprise mainly investments and related revenue, loans
and borrowings and related expenses, corporate assets
and head office expenses, and income tax assets and
liabilities.
Segment capital expenditure is the total cost incurred
during the period to acquire property, plant and
equipment, and intangible assets other than goodwill.
(u) Goods and services tax
Revenue, expenses and assets are recognised net of the
amount of goods and services tax (GST), except where
Notes to the Consolidated Financial Statements
the amount of GST incurred is not recoverable from the
taxation authority. In these circumstances, the GST is
recognised as part of the cost of acquisition of the asset
or as part of the expense.
Receivables and payables are stated with the amount of
GST included. The net amount of GST recoverable from,
or payable to, the ATO is included as a current asset or
liability in the statement of financial position.
Cash flows are included in the statement of cash flows
on a gross basis. The GST components of cash flows
arising from investing and financing activities which are
recoverable from, or payable to, the ATO are classified as
operating cash flows.
(v) New standards and interpretations not yet
adopted
A number of new standards, amendments to standards
and interpretations are effective for annual periods
beginning after 1 July 2013, and have not been applied in
preparing these consolidated financial statements. None
of these standards are expected to have a material impact
on the financial statements.
4. Determination of fair values
A number of the Groups accounting policies and
disclosures require the determination of fair value, for
both financial and non-financial assets and liabilities.
Fair values have been determined for measurement
and / or disclosure purposes based on the following
methods. Where applicable, further information about the
assumptions made in determining fair values is disclosed
in the notes specific to that asset or liability.
(a) Property, plant and equipment
The fair value of property, plant and equipment recognised
as a result of a business combination is based on market
values. The market value of property is the estimated
amount for which a property could be exchanged
on the date of valuation between a willing buyer and
a willing seller in an arms length transaction after
Genea Limited Annual Report 2014
proper marketing wherein the parties had each acted
knowledgeably, prudently and without compulsion. The
market value of items of plant, equipment, fixtures and
fittings is based on the quoted market prices for similar
items.
(b) Intangible assets
Initially, intangible assets are measured at the cost to
develop them. The recoverability of each intangible asset
is assessed annually against the discounted cash flows
expected to be derived from the use and eventual sale of
the asset.
(c) Trade and other receivables
The fair value of trade and other receivables, excluding
construction work in progress, is estimated as the present
value of future cash flows, discounted at the market rate
of interest at the reporting date.
(d) Non-derivative financial liabilities
Fair value, which is determined for disclosure purposes, is
calculated based on the present value of future principal
and interest cash flows, discounted at the market rate
of interest at the reporting date. For finance leases the
market rate of interest is determined by reference to
similar lease agreements.
(e) Share-based payment transactions
The fair value of employee stock options is measured
using a Black-Scholes formula. Measurement inputs
include share price on measurement date, exercise price
of the instrument, expected volatility (based on weighted
average historic volatility adjusted for changes expected
due to publicly available information), weighted average
expected life of the instruments (based on historical
experience and general option holder behaviour),
expected dividends, and the risk-free interest rate
(based on government bonds). Service and non-market
performance conditions attached to the transactions are
not taken into account in determining fair value.
71
Notes to the Consolidated
Financial Statements (cont.)
5. Operating segments
The Group has three reportable segments:
Fertility (formerly known as IVF & Related Services)
Biomedx
Biocells
From 1 July 2013 the Group established two new
businesses: Genea Biomedx Pty Limited (Biomedx), for
the manufacture and sale of culture media and medical
instruments used in IVF, and Genea Biocells Pty Limited
(Biocells), for the cultivation and sale of stem cells. Both
businesses utilise research developed by the Groups
Stem Cells & Research division over many years. Trading
for these two new businesses has been reported
separately commencing 1 July 2013 and replaced
reporting for the Stem Cells & Research division from
that date.
These business units offer different products and
services and are reported separately to the Board,
Executive and Management in the Groups internal
management reporting.
72
Information regarding the results of each reportable
segment is included below. Performance is measured
using segment earnings before interest and tax as included
in the internal management reports. Inter-segment pricing
is determined on an arms length basis.
Segment results, assets and liabilities include items
directly attributable to a segment as well as those
that can be directly allocated on a reasonable basis.
Unallocated items comprise mainly corporate assets
and expenses.
Segment capital expenditure is the total cost incurred
during the period to acquire segment assets that are
expected to be used for more than one period.
Prior year comparative amounts have been restated to
reflect the reportable segments recognised from 1 July
2013.
Notes to the Consolidated Financial Statements
Information about reportable segments 2014

2014 Consolidated

In AUD ($000) Fertility Biomedx Biocells Total

External revenue
Rendering of services 75,436 - 327 75,763
Sale of products - 110 46 156
Royalties received - - 340 340
Total revenue 75,436 110 713 76,259
Depreciation and amortisation (2,091) (167) (657) (2,915)
Share of profits from equity accounted
1,443 - - 1,443
investees

Segment earnings/(losses) before interest

14,171 (8,078) (2,511) 3,582
and tax (EBIT) (1)
Unallocated amounts: other corporate
(168)
expenses
Earnings before interest and tax (EBIT) 3,414
Net financing expense (111)
Profit before tax 3,303
Reportable segment assets 33,180 13,770 3,792 50,742
Other unallocated amounts 1,214
Total assets 51,956
Reportable segment liabilities (8,113) (2,282) (903) (11,298)
Other unallocated amounts (11,264)
Total liabilities (22,562)
Investment in equity accounted investees 4,341 - - 4,341
Segment capital expenditure 1,970 1,885 85 3,940
(1) EBIT for the Fertility segment includes the impairment loss of $1.3 million relating to goodwill written off (see note 20).

Genea Limited Annual Report 2014 73

Notes to the Consolidated
Financial Statements (cont.)
Information about reportable segments 2013

2013 Consolidated

In AUD ($000) Fertility Biomedx Biocells Total

External revenue
Rendering of services 69,849 - 246 70,095
Sale of licence fee - 2,670 - 2,670
Royalties received - - 677 677
Total revenue 69,849 2,670 923 73,442
Depreciation and amortisation (2,411) (372) (127) (2,910)
Share of profits from equity accounted
1,581 - - 1,581
investees

Segment earnings/(losses) before interest

13,312 (3,741) (1,755) 7,816
and tax (EBIT)
Unallocated amounts: other corporate
(2,301)
expenses
Earnings before interest and tax (EBIT) 5,515
Net financing income 141
Profit before tax 5,656
Reportable segment assets 28,316 8,854 5,130 42,300
Other unallocated amounts 4,882
Total assets 47,182
Reportable segment liabilities (8,964) (972) (869) (10,805)
Other unallocated amounts (9,449)
Total liabilities (20,254)
Investment in equity accounted investees 3,186 - - 3,186
Segment capital expenditure 2,133 100 352 2,585

Geographical segments
The Group operates principally out of one geographic segment, Australia. The Group also has operations in:
Thailand and New Zealand through a 50% interest in Oogonia Co. Limited and Genea Oxford Womens Health Ltd
(formerly known as Peterborough Clinic Limited) respectively, reported as equity accounted investees; and
The United Kingdom, through its wholly-owned subsidiary Genea Biomedx UK Ltd. This operation is currently in a
set-up phase and has not commenced trading.

74 Notes to the Consolidated Financial Statements

 6. Other income

Consolidated
In AUD ($000) 2014 2013
Rental income 218 201
Other 250 193
468 394

7. Other expenses

Consolidated
In AUD ($000) Note 2014 2013
Included in the statement of profit or loss and other comprehensive income
but not separately disclosed:
Net loss on disposal of plant and equipment 1 -
(Net reversal of)/impairment losses on trade and other receivables 27 (66) 397
Credit with a trade supplier written off 13b - 134
Plant and equipment written off 19 - 455
Intangible asset written off (1)
20 1,288 416
Operating lease rentals 28 3,786 3,344
Depreciation and amortisation expenses 19, 20 3,831 3,405

(1) Intangible asset written off relating to goodwill of $1.3 million is included in Administrative Expenses in the statement of profit or loss and
other comprehensive income.

Genea Limited Annual Report 2014 75

Notes to the Consolidated
Financial Statements (cont.)
8. Auditors remuneration

Consolidated
In AUD 2014 2013
Audit services
Auditors of the Company
KPMG Australia:
Audit 206,400 209,905
Tax services
Auditors of the Company
KPMG Australia:
Income tax - 10,123
Research & development taxation advice - 16,890
Other services
Auditors of the Company
KPMG Australia:
Due diligence services - 6,000
KPMG Italy:
Due diligence services 40,650 -

9. Finance income and expenses

Consolidated
In AUD ($000) Note 2014 2013
Interest income on bank deposits 30 148
Financial income 30 148
Interest expense (46) -
Finance charges on capitalised leases (2) (6)
Net foreign exchange loss (44) -
Unwind of discount on provisions 25 (49) (1)
Financial expenses (141) (7)
Net financing (expense)/income (111) 141

76 Notes to the Consolidated Financial Statements

10. Research and development expenditure
The accounting for research and development is in accordance with the policy described in note 3(e)(ii).

Consolidated
In AUD ($000) Note 2014 2013
Expenditure
Direct research and development expenditure (9,153) (10,373)
Depreciation and amortisation (824) (499)
Development capitalised:
Internally generated 20 823 503
Acquired 20 4,979 3,896

Research and development expensed in the statement of profit or loss and

(4,175) (6,473)
other comprehensive income

Accumulated development capitalised 20 18,179 12,377

Accumulated deferred revenue 757 869

This research and development expenditure disclosure has been modified to reflect the fact such expenditure is
now reported within several Group entities, rather than being a separate reporting segment. In addition, certain
administrative expenses formerly treated as research and development are now reported as Administrative expenses,
and the comparative amounts have been restated accordingly, both here and in the statement of profit or loss and
other comprehensive income, resulting in $1.0 million being reclassified from Research and development expenses to
Administrative expenses in the comparative period.

Genea Limited Annual Report 2014 77

Notes to the Consolidated
Financial Statements (cont.)
11. Income tax expense

Consolidated
In AUD ($000) 2014 2013
Current tax expense
Current year (1,600) (922)
Adjustments for prior years (2,128) (108)
(3,728) (1,030)
Deferred tax expense
Origination and reversal of temporary differences 1,628 1,364
Total income tax expense in the statement of profit or loss and other comprehensive income (2,100) 334

Numerical reconciliation between tax expense and pre-tax net profit

Consolidated
In AUD ($000) 2014 2013
Profit before tax 3,303 5,656
Income tax using the domestic corporation tax rate of 30% (2013: 30%) 991 1,697
Increase in income tax expense due to:
Non-deductible expenses 389 10
Tax losses not probable of recoupment - 360
Effect of tax rates in foreign jurisdictions 91 -
Decrease in income tax expense due to:
Share of after tax profits equity accounted (433) (474)
R&D tax incentives not recognised in profit (1,013) (1,138)
Other items 3 (13)
Adjustment for prior years (1)
(2,128) (108)
Income tax expense (2,100) 334

(1) In 2014, $7.1 million of previously unrecognised tax offsets were recognised as management considered it probable that future taxable profits
would be available against which they can be utilised. These offsets arise as a result of the tax rebate associated with the Groups substantial R&D
expenditure.

78 Notes to the Consolidated Financial Statements

12. Earnings per share
Basic earnings per share
The calculation of basic earnings per share at 30 June 2014 was based on the profit attributable to ordinary
shareholders of $4.9 million (2013: $4.9 million) and a weighted average number of ordinary shares outstanding of
2,846,965 (2013: 2,829,386), calculated as follows:

Consolidated
In AUD ($000) Note 2014 2013
Profit attributable to ordinary shareholders 4,936 4,883
In thousands of shares
Issued ordinary shares at 1 July 26 2,846 2,813
Weighted average of shares issued 1 16
Weighted average number of ordinary shares during the financial year ended 30 June 2,847 2,829
Basic earnings per share 1.73 1.73

Diluted earnings per share

The calculation of diluted earnings per share at 30 June 2014 was based on profit attributable to ordinary
shareholders of $4.9 million (2013: $4.9 million) and a weighted average number of ordinary shares (diluted)
outstanding during the financial year ended 30 June 2014 of 2,846,965 (2013: 2,852,055), calculated as follows:

Consolidated
In AUD ($000) 2014 2013
Profit attributable to ordinary shareholders (diluted) 4,936 4,883
In thousands of shares
Weighted average number of ordinary shares (basic) 2,847 2,829

Effect of share options on issue - 23

Weighted average number of ordinary shares (diluted) during the financial year ended 30 June 2,847 2,852
Diluted earnings per share 1.73 1.71

Genea Limited Annual Report 2014 79

Notes to the Consolidated
Financial Statements (cont.)
13a. Cash and cash equivalents

Consolidated
In AUD ($000) 2014 2013
Bank balances and cash on hand 761 2,276
Call deposits 83 3,167
Cash and cash equivalents 844 5,443

The Groups exposure to interest rate risk and a sensitivity analysis for financial assets are disclosed in note 27.

80 Notes to the Consolidated Financial Statements

13b. Reconciliation of cash flows from operating activities

Consolidated
In AUD ($000) Note 2014 2013
Cash flows from operating activities
Profit for the period 5,403 5,322
Adjustments for:
Depreciation and amortisation 7 3,831 3,405
Foreign exchange loss 9 44 -
Share of profit of equity accounted investees 16 (1,443) (1,581)
Dividends from equity accounted investees 640 656
Unwind of discount on make good provisions 25 49 1
Property incentive (395) (470)
Share-based payments 24(c) 23 (29)
(Net reversal of)/impairment losses on trade receivables 27 (66) 397
Overpayment to a trade supplier written off 7 - 134
Plant and equipment written off 19 - 455
Intangible asset written off 20 1,288 416
Loss/(gain) on disposal of plant and equipment 1 (34)
Operating profit before changes in working capital and provisions 9,375 8,672
Increase in trade and other receivables (521) (1,131)
Increase in other assets (1,682) (548)
(Decrease)/increase in trade and other payables (291) 3,063
Decrease in deferred income (518) (637)
(Decrease)/increase in employee benefits (247) 260
Decrease in other liabilities (260) (136)
(Decrease)/increase in deferred tax liabilities (4,145) 1,364
Decrease/(increase) in provision for income tax receivable 1,513 (1,883)
Net cash from operating activities 3,224 9,024

Genea Limited Annual Report 2014 81

Notes to the Consolidated
Financial Statements (cont.)
14. Trade and other receivables

Consolidated
In AUD ($000) 2014 2013
Current
Trade receivables 1,552 1,847
Other receivables 1,032 813
2,584 2,660
Non-current
Other receivables
Loan to a related party 619 -
619 -

At 30 June 2014 trade and other receivables are shown net of an allowance for doubtful debts of $116,000 (2013:
$408,000). The impairment loss recognised in the current year of $94,000 (2013: $397,000) was offset against a
reversal of impairment loss of $160,000 (2013: $nil) to give a net reversal of impairment loss of $66,000.
The Groups exposure to credit risk and impairment losses related to trade and other receivables are disclosed in
note 27.

15. Other assets

Consolidated
In AUD ($000) 2014 2013
Supplies and spares 1,395 1,263
Prepayments 885 429
Pre-production payment 1,094 -
3,374 1,692

82 Notes to the Consolidated Financial Statements

16. Investments in equity accounted investees
The Groups recognised share of net profit in its equity accounted investees for the year was $1.4 million (2013:
$1.6 million). During the year, the Group received dividends of $640,000 (2013: $666,000) from its investments
in equity accounted investees.
The Group has the following investments in equity accounted investees:

Reporting Ownership
Principal activities Country Date 2014 2013
(a) Interest in associate
Genea Newcastle Pty Limited Scientific and medical services Australia 30 June 40% 40%
(b) Interest in joint ventures
Oogonia Co. Limited Scientific and medical services Thailand 31 December 50% 50%
Genea Oxford Women's
Health Ltd (formerly known as Scientific and medical services New Zealand 30 June 50% 50%
Peterborough Clinic Limited)

Summary financial information for equity accounted investees:

Consolidated
In AUD ($000) 2014 2013
Carrying amount of interest:
Joint ventures 3,715 2,445
Associate 626 741
4,341 3,186
Share of profit:
Joint ventures 918 1,147
Associate 525 434
1,443 1,581

Genea Limited Annual Report 2014 83

Notes to the Consolidated
Financial Statements (cont.)
(i) Joint ventures

2014 Consolidated
Genea Oxford Oogonia Co.
In AUD ($000) Total
Women's Health Ltd Limited
Ownership 50% 50%
Non-current assets 2,321 2,161 4,482
Current assets 63 6,256 6,319
Non-current liabilities (863) (36) (899)
Current liabilities (297) (2,175) (2,472)
Net assets (100%) 1,224 6,206 7,430
Carrying amount of interests in joint ventures 612 3,103 3,715
Revenue 50 11,717 11,767
Depreciation and amortisation - (322) (322)
Profit/(loss) and total comprehensive income (100%) (544) 2,380 1,836
Group's share of profit/(loss) and total comprehensive income (272) 1,190 918

2013 Consolidated
Genea Oxford Oogonia Co.
In AUD ($000) Total
Women's Health Ltd Limited
Ownership 50% 50%
Non-current assets 647 994 1,641
Current assets 283 4,401 4,684
Non-current liabilities - (40) (40)
Current liabilities (252) (1,144) (1,396)
Net assets (100%) 678 4,211 4,889
Carrying amount of interests in joint ventures 339 2,106 2,445
Revenue - 8,084 8,084
Depreciation and amortisation - (200) (200)
Profit/(loss) and total comprehensive income (100%) - 2,294 2,294
Group's share of profit/(loss) and total comprehensive income - 1,147 1,147
Dividends received by the Group - 136 136

Oogonia Co. Limited has a reporting date of 31 December as required for Thai corporate entities. Genea does not
have enough influence over the entity to make a change to its reporting date.
84 Notes to the Consolidated Financial Statements
(ii) Associate

Consolidated
In AUD ($000) 2014 2013
Carrying amount of interest in associate 626 741
Share of profit from continuing operations 525 434

17. Group entities and non-controlling interests

Country of Ownership
incorporation interest
2014 2013
(a) Parent entity
Genea Limited Australia

(b) Subsidiaries
Genea Genetics Pty Limited as trustee for Genea Genetics Unit Trust Australia 100% 100%
Genea Biocells Pty Limited Australia 100% 100%
Genea Canberra Pty Limited Australia 87.5% 87.5%
Genea Perth Pty Limited (formerly known as Sydney IVF Perth Pty Limited) Australia 71% 71%
Genea Biomedx Pty Limited Australia 100% 100%
Genea Biomedx UK Limited UK 100% 0%
Genea US Inc. US 100% 0%

(c) Trusts
On 31 May 2014 Launceston.SIVF Unit Trust was dissolved.
On 1 July 2014 the assets and liabilities of the Genea Genetics Unit Trust were transferred to Genea Limited and the
trust dissolved.

Genea Limited Annual Report 2014 85

Notes to the Consolidated
Financial Statements (cont.)
18. Tax assets and liabilities
(a) Current assets
The current tax asset for the Group of $395,000 (2013: $1.9 million) represents the net amount of income taxes
receivable in respect of the current financial period. The asset arises as a result of the tax rebate associated with
the Groups substantial R&D expenditure.
A deferred tax asset is recognised for unused tax offsets, tax credits and deductible temporary differences, to the
extent that it is probable that future taxable profits will be available against which they can be utilised. Deferred
tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the
related tax benefit will be realised.
(b) Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:

Consolidated
Assets Liabilities Net
In AUD ($000) 2014 2013 2014 2013 2014 2013
Property, plant and equipment 279 268 - - 279 268
Employee benefits 1,140 1,041 - - 1,140 1,041
Impairment provision trade receivables 44 122 - - 44 122
Capitalisation of development expenditure - - (5,263) (3,675) (5,263) (3,675)
Operating leases 312 390 - - 312 390
Tax offsets carried forward 5,773 - - - 5,773 -
Other items 418 412 - - 418 412
Net tax assets/(liabilities) 7,966 2,233 (5,263) (3,675) 2,703 (1,442)

86 Notes to the Consolidated Financial Statements

19. Property, plant and equipment

Consolidated
Plant and Leasehold Under
In AUD ($000) Note equipment (1) improvements construction Total
Cost
Balance at 1 July 2012 22,185 16,599 561 39,345
Acquisitions (2) 1,241 289 1,208 2,738
Disposals (215) - - (215)
Transfers 200 - (200) -
Assets written off 7 - - (455) (455)
Balance at 30 June 2013 23,411 16,888 1,114 41,413
Balance at 1 July 2013 23,411 16,888 1,114 41,413
Acquisitions (2)
1,684 373 2,064 4,121
Disposals (72) - - (72)
Transfers 1,457 254 (1,711) -
Balance at 30 June 2014 26,480 17,515 1,467 45,462
Depreciation and impairment losses
Balance at 1 July 2012 16,082 7,057 - 23,139
Depreciation charge for the year 7 1,948 1,330 - 3,278
Disposals (203) - - (203)
Balance at 30 June 2013 17,827 8,387 - 26,214
Balance at 1 July 2013 17,827 8,387 - 26,214
Depreciation charge for the year 7 1,900 1,423 - 3,323
Disposals (71) - - (71)
Balance at 30 June 2014 19,656 9,810 - 29,466
Carrying amounts
At 1 July 2012 6,103 9,542 561 16,206
At 30 June 2013 5,584 8,501 1,114 15,199
At 30 June 2014 6,824 7,705 1,467 15,996
(1) Includes a leased asset costing $35,000 with an accumulated depreciation of $28,000 (2013: $21,000).
(2) Reconciles to cash flow as follows:

In AUD ($000) 2014 2013

Total acquisitions 4,121 2,738
Less: Fit out make good at end of lease - (55)
Total property, plant and equipment cash outflow 4,121 2,683

Genea Limited Annual Report 2014 87

Notes to the Consolidated
Financial Statements (cont.)
20. Intangible assets

Consolidated
In AUD ($000) Note Goodwill Development Total
expenditure
Cost
Balance at 1 July 2012 3,917 8,394 12,311
Acquisitions through business combinations 927 - 927
Additions Development expenditure capitalised:
Internally generated - 503 503
Acquired - 3,896 3,896
4,844 12,793 17,637
Development expenditure written off - (416) (416)
Balance at 30 June 2013 4,844 12,377 17,221

Balance at 1 July 2013 4,844 12,377 17,221

Additions Development expenditure capitalised:
Internally generated - 823 823
Acquired - 4,979 4,979
4,844 18,179 23,023
Goodwill written off 7 (1,288) - (1,288)
Balance at 30 June 2014 3,556 18,179 21,735
Accumulated amortisation
Balance at 1 July 2012 - - -
Amortisation for the year - 127 127
Balance at 30 June 2013 - 127 127
Amortisation for the year - 508 508
Balance at 30 June 2014 - 635 635
Carrying amounts
Balance at 1 July 2012 3,917 8,394 12,311
Balance at 30 June 2013 4,844 12,250 17,094
Balance at 30 June 2014 3,556 17,544 21,100

88 Notes to the Consolidated Financial Statements

Recoverability of development expenditure
Development expenditure comprises costs incurred to plan and design substantially improved products and processes.
A review is undertaken annually for indicators of impairment. At 30 June 2014 there are no indications that the value of
development capitalised is impaired, with associated projects tracking against milestones.
Amortisation commences on completion of each project and continues over the period future economic benefits are
expected to accrue.
Impairment tests for cash generating units containing goodwill
For the purpose of impairment testing, goodwill is allocated to the Groups operating divisions which represent the
lowest level within the Group at which the goodwill is monitored for internal management purposes.
The aggregate carrying amounts of goodwill allocated to each unit are as follows:

Consolidated
In AUD ($000) 2014 2013
First trimester screening - 1,288
Genea Perth Pty Limited 3,556 3,556
3,556 4,844

The recoverable amount of cash-generating units containing goodwill is based on value in use calculations. Those
calculations use cash flow projections based on the most recent budgeted operating results over a 5 year period
and include a terminal value reflecting disposal of the assets. A growth rate of 2%, which is in line with the long term
average national GDP growth rate, is used to extrapolate cash flow projections beyond the period covered by our
budgets.
Pre-tax discount rates of 9.3% (2013: 12.0%) and 10.4% (2013: 12.4%) were applied in determining the recoverable
amount of First trimester screening and Genea Perth Pty Limited respectively. The discount rates were estimated
based on the calculated weighted average cost of capital.
At 30 June 2014 the value of the investment in Genea Perth Pty Limited is supported by the recoverable amount.
Goodwill of $1.3 million relating to First trimester screening was written off in 2014 due to advancements in medical
science that have rendered this technique obsolete.

Genea Limited Annual Report 2014 89

Notes to the Consolidated
Financial Statements (cont.)
21. Trade and other payables

Consolidated
In AUD ($000) 2014 2013
Current
Trade payables 3,596 4,580
Accrued expenses 1,864 1,177
Other payables 65 59
5,525 5,816

The Groups exposure to currency and liquidity risk related to trade and other payables is disclosed in note 27.

22. Other liabilities

Consolidated
In AUD ($000) 2014 2013
Current
Deferred income 1,591 2,109
Leasehold rental accrual 369 262
Operating lease incentive 474 470
2,434 2,841
Non-current
Leasehold rental accrual 670 1,036
Operating lease incentive 2,888 3,286
3,558 4,322

Grant income of $897,000 received in the period 2007 to 2009 in relation to capitalised development expenditure was
recorded as deferred income. Amortisation of the relevant development expenditure commenced in 2013 over a period
of 8 years. The deferred grant income will be amortised over the same period.

90 Notes to the Consolidated Financial Statements

23. Loans and borrowings
This note provides information about the contractual terms of the Groups interest-bearing loans and borrowings. For
more information about the Groups exposure to interest rate, foreign currency and liquidity risk, see note 27. All loans
are denominated in Australian dollars unless otherwise indicated.

Consolidated
In AUD ($000) 2014 2013
Current
Bank overdraft 1,431 -
Finance lease liability - 8
1,431 8
Non-current
Secured bank loan 4,000 -
Finance lease liability - 12
4,000 12

Financing facilities

Consolidated
In AUD ($000) 2014 2013
Credit card facility 720 677
Multi option facility 13,000 -
13,720 677
In GBP ('000)
Cash advance facility 1,400 -

Genea Limited Annual Report 2014 91

Notes to the Consolidated
Financial Statements (cont.)

Financing facilities not utilised at reporting date

Consolidated
In AUD ($000) 2014 2013
Credit card facility 574 524
Multi option facility 7,569 -
8,143 524
In GBP ('000)
Cash advance facility 1,400 -

The multi option facility encompasses overdraft, cash advance and lease financing.

Credit card facility

Interest on credit card facilities is charged at prevailing market rates in the event it is incurred.

Secured bank loan and bank overdraft

Interest on the secured bank loan and bank overdraft is charged at prevailing market rates. The facilities are secured
by a registered mortgage debenture (fixed and floating charge) over the assets of Genea Limited and its wholly-owned
Australian subsidiaries. The bank overdraft is payable on demand while the secured bank loan is payable on maturity.

24. Employee benefits

(a) Liabilities

Consolidated
In AUD ($000) 2014 2013
Current
Salaries and wages accrued 350 927
Liability for annual leave 2,102 1,951
Liability for long service leave 940 843
3,392 3,721
Non-current
Liability for long service leave 758 677

92 Notes to the Consolidated Financial Statements

(b) Share-based payments
Genea Share Plan
On 28 June 2006, the directors approved an employee share plan whereby the directors, at their discretion, can grant
to qualifying employees a limited recourse loan for the purpose of acquiring Company shares. The loans are interest
free, repayable over 10 years from dividends paid on the shares, with additional repayments being optional during the
period. Until the loan is repaid in full, loan recipients may not sell, transfer or otherwise deal with the shares.
As a result of the shares being issued against a limited recourse loan, the share plan is accounted for in the same
manner as the option plan. Accordingly, the fair value of services received in return for shares issued under the plan
is based on the fair value of the notional option granted. In addition, the recognition of an increase in equity and the
associated loan receivable is deferred until such time as the loan is repaid. Equally, the dividends applied to the loan
balance are not recognised in the financial statements.

Employee Performance Rights Plan

Shareholders approved an employee performance rights plan at the Annual General Meeting held on 16 November
2011. The Plan was designed to provide an incentive for eligible key employees to make a positive contribution to
Genea. Participants are not required to pay any consideration for the Performance Rights or to acquire shares upon the
vesting of the rights. The Performance Rights will automatically convert into Shares if held for 5 years after grant date
and are then subject to a 2 year dealing restriction. Key employees who hold Performance Rights have no dividend,
voting or other shareholder rights unless and until they acquire shares upon vesting of the Performance Rights.
The fair value of the shares is based upon the latest traded market price for the shares prior to the offer. In estimating
the fair value of the shares, the effect of post-vesting transfer restrictions is taken into consideration to estimate
what the price of the restricted share would have been on the purchase date in an arms length transaction between
knowledgeable, willing parties. In determining the discount to be applied, the indicator lending rate as published by the
Reserve Bank of Australia has been used.

(c) Employee expenses and share-based payments

Consolidated
In AUD ($000) 2014 2013
Wages and salaries 26,531 26,784
Contributions to defined contribution plans 2,299 2,193
Share options granted equity settled 23 (29)
Long service leave entitlements 178 (67)
Total expense recognised as employee costs 29,031 28,881

Genea Limited Annual Report 2014 93

Notes to the Consolidated
Financial Statements (cont.)
25. Provisions
Provisions comprise make good obligations in relation to various leased premises.

Make good
The Group accounts for premises make good obligations in accordance with the policy in note 3(l)(i). At the inception
of the lease the best estimate of the expenditure required to remediate the premises in accordance with the relevant
lease agreement is recognised at its present value. A corresponding increase in the cost of the asset to be made good
is recognised and depreciated over the term of the lease.

Consolidated
In AUD ($000) Note 2014 2013
Balance at 1 July 1,415 1,359
Premises make good provision recognised during the period - 55
Unwind of discount on make good provisions 9 49 1
Balance at 30 June 1,464 1,415

Current 211 -
Non-current 1,253 1,415
1,464 1,415

94 Notes to the Consolidated Financial Statements

26. Capital and reserves

Company
Share capital ordinary shares
In shares - fully paid 2014 2013
On issue at 1 July (1)
2,846,372 2,813,305
Options exercised (2)
600 25,200
Director's fee issued in equity (3)
3,712 3,304
Shares issued - 4,563
On issue at 30 June(4) 2,850,684 2,846,372

(1) Effective 1 July 1998, the Company Law Review Act abolished the concept of par value of shares and the concept of authorised capital.
Accordingly, the Company does not have authorised capital or par value in respect of its issued shares. The holders of ordinary shares are entitled
to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. All shares rank equally with
regard to the distribution of the Companys residual assets.
(2) 600 options were exercised from the 2006 Employee Share Plan.
(3) 3,712 ordinary shares were issued to four directors in lieu of directors fees. All shares issued are fully paid.

(4) The Companys share register records that there are 2,860,084 fully paid ordinary shares in the Company on issue. The difference of 9,400
shares reflects the number of shares that have been issued under the terms of the Genea Share Plan (see note 24(b).

Equity compensation reserve

The equity compensation reserve represents the costs recognised in the statement of profit or loss and other
comprehensive income arising from share-based payments. This reserve will be reversed against share capital when
the underlying shares are exercised under share options.

Translation reserve
The translation reserve arises when the net assets and results of foreign operations are translated from the functional
currency to Australian dollars.

Genea Limited Annual Report 2014 95

Notes to the Consolidated
Financial Statements (cont.)
Dividends
Dividends recognised in the current year by the Company are:
Franked/
Cents per share Total amount unfranked Date of payment

In AUD $000
2014
Interim 2014 ordinary 37.0 1,053 Unfranked 24 April 2014
Final 2013 ordinary 46.0 1,310 Unfranked 26 November 2013
Total amount 2,363
2013
Interim 2013 ordinary 76.0 2,157 Partially franked 26 April 2013
Final 2012 ordinary 120.0 3,389 Unfranked 30 November 2012
Total amount 5,546

After the balance sheet date the following dividend was proposed by the directors. The dividend has not been provided
for. The declaration and subsequent payment of dividends has no income tax consequences.
Franked/
Cents per share Total amount unfranked Date of payment

In AUD $000

Final 2014 ordinary 54.0 1,539 Partially franked 28 November 2014

The financial effect of this dividend has not been brought to account in the financial statements for the financial year
ended 30 June 2014 and will be recognised in subsequent financial reports.

Company
In AUD ($000) 2014 2013
Dividend franking account

30 per cent franking credits available to shareholders of Genea Limited for subsequent financial years 870 92

The ability to utilise the franking credits is dependent upon there being sufficient available profits to declare dividends.
The impact on the dividend franking account of dividends proposed after the balance sheet date but not recognised
as a liability is to reduce it by $343,000 (2013: $nil). At year end, undistributed available profits to declare dividends in
Australian subsidiary entities was $3.1 million. If or when a fully franked dividend distribution of these profits is paid out,
the associated franking credits are $1.3 million.

96 Notes to the Consolidated Financial Statements

27. Financial instruments
Overview
The Company and Group have exposure to the following risks from their use of financial instruments:
credit risk
liquidity risk
market risk
currency risk
This note presents information about the Groups exposure to each of the above risks, and the objectives, policies and
processes for measuring and managing risk, and the management of capital.

Risk management framework

Risk management is part of the Groups operating culture. At the Board level the Audit, Risk Management and
Compliance Committee is responsible for the establishment, implementation, and annual review of the Groups Risk
Management System. Management has established and implemented the Risk Management System for assessing,
monitoring and managing all risks, including material business risks, for the Group. The Chief Executive Officer and
Chief Financial Officer have provided assurance to the Board that the financial reporting risk management and
associated compliance and controls have been assessed and found to be operating effectively. The operational and
other risk management compliance and controls have also been assessed and found to be operating effectively.

Credit risk
Credit risk is the risk of financial loss to the Group if a patient or customer or counterparty to a financial instrument fails
to meet its contractual obligations, and arises principally from the Groups receivables due from patients or customers.

Exposure to credit risk

Carrying amounts of the Group financial assets represents the maximum credit exposure. The maximum exposure to
credit risk at the reporting date was:

Consolidated
In AUD ($000) Note 2014 2013
Cash and cash equivalents 13a 844 5,443
Trade and other receivables 14 2,584 2,660
3,428 8,103

Genea Limited Annual Report 2014 97

Notes to the Consolidated
Financial Statements (cont.)
Based on the Groups monitoring of customer credit risk, the Group believes that, except as noted below, no impairment
allowance is necessary in respect of trade and other receivables. The Groups most significant concentration of credit
risk accounts for $301,772 of the trade and other receivables carrying amount at 30 June 2014 (2013: $288,550).
These amounts are associated with customers who have more than five years trading history with the Group.
Other than these exposures, at reporting date there were no significant concentrations of credit risk with the exception
of cash and cash equivalents which are held with a small number of financial institutions. The maximum exposure to
credit risk is represented by the carrying amount of each financial asset in the statement of financial position. The
Group does not require collateral in respect of financial assets.
The Groups maximum exposure to credit risk for trade receivables at the reporting date was predominantly within
Australia from patients receiving ART services.

Trade and other receivables

Under the billing arrangement between Genea and its accredited doctors, the Group bears the credit risk for
the amount receivable from patients. The Groups exposure to credit risk is influenced mainly by the individual
characteristics of each patient. Processes have been established to limit the credit exposure in the first instance. Where
amounts due are not received at the time of service, additional processes are in place to recover the outstanding
amounts.
The Group has established an allowance for impairment that represents the estimate of incurred losses in respect of
trade and other receivables. The main components of this allowance are a collective loss component established for
groups of similar assets in respect of losses that have been incurred but not yet identified. The collective loss allowance
is determined based on historical data of actual incurred losses for similar financial assets.

Impairment Losses
Aging of the Group trade receivables at the reporting date was:

Consolidated
Gross Impairment Gross Impairment

In AUD ($000) 2014 2013

Not past due 959 17 1,021 17
Past due to 30 days 276 11 166 6
Past due 31 - 60 days 211 15 238 14
Past due greater than 60 days 222 73 831 371
1,668 116 2,256 408

98 Notes to the Consolidated Financial Statements

The movement in the allowance for impairment in respect of trade receivables during the year was:

Consolidated
In AUD ($000) Note 2014 2013
Balance at 1 July 408 127
(Net reversal of)/impairment losses 7 (66) 397
Write off (226) (116)
Balance at 30 June 116 408

The collective impairment loss relates to amounts owing from patients for the provision of ART services and other
customers. Except for the exposure to credit risk noted above, no amounts owing from any particular patient are
considered significant. Based on historical collection rates there are trade receivables past due date that are not
considered impaired. No terms have been re-negotiated.

Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Groups
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses, risking damage
to the Groups reputation or financial statements.
The Group performs regular cash forecasts, which assist it in monitoring cash flow requirements and optimising its cash
return on investments. Typically the Group ensures that it has sufficient cash on demand to meet expected operational
expenses for a period of 30 days, excluding the potential impact of extreme circumstances that cannot reasonably be
predicted, such as natural disasters. In addition, the Group maintains lines of credit as outlined in Note 23.

Genea Limited Annual Report 2014 99

Notes to the Consolidated
Financial Statements (cont.)
The following are the contractual maturities of financial liabilities including estimated interest payments:

Consolidated 2014

In AUD ($000) Carrying Contractual 0-1 year 1-2 years 2-5 years
amount cash flow
Trade and other payables 5,525 5,525 5,525 - -
Bank overdrafts 1,431 1,431 1,431 - -
Secured bank loan 4,000 4,402 161 1,467 2,774
10,956 11,358 7,117 1,467 2,774

Consolidated 2013

In AUD ($000) Carrying Contractual 0-1 year 1-2 years 2-5 years
amount cash flow
Trade and other payables 5,816 5,816 5,816 - -
Finance lease liability 20 25 12 12 1
5,836 5,841 5,828 12 1
Market Risk
Market risk is the risk that changes in market prices, such as equity prices, will affect the Groups income. The objective
of market risk management is to manage and control market risk exposures within acceptable parameters, while
optimising the return. The Group has minimal exposure to market risks.

Currency Risk
The Group is exposed to currency risk on purchases and borrowings that are denominated in a currency other than the
functional currency of the Group entities, primarily the Australian dollar (AUD).
Interest on borrowings is denominated in currencies that match the cash flows generated by the underlying operations
of the Group.
The Group currently has minimal exposure to foreign currency, although this will need to be monitored in future as its
operations in the United Kingdom in particular commence trading.

100 Notes to the Consolidated Financial Statements

Interest Rate Risk
Investments in short-term receivables and payables are not exposed to interest rate risk.
At the reporting date the interest rate profile of the Groups interest bearing financial instruments was:

Consolidated
In AUD ($000) 2014 2013
Variable rate instruments
Financial assets 844 5,443
Financial liabilities (5,431) (20)
(4,587) 5,423

Sensitivity Analysis
Due to the limited exposure to interest rate risk the Group does not fix interest rates. Cash in excess of operating
requirements is maintained in a high earning, but liquid account to maximise the return.
Financial liabilities are predominantly comprised of short term cash advances, where the interest rate is fixed over the
term of the cash advance.

Capital management
The Groups policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. The Board determines the level of dividends to ordinary shareholders.
There were no changes in the Groups approach to capital management during the year.
No Group entities are subject to externally imposed capital requirements.

Fair values
The net fair value of all financial assets and financial liabilities in the financial statements, except for the secured
bank loan, approximates their carrying value. No financial assets or financial liabilities are readily traded on organised
markets.
The aggregate net fair values and carrying amounts of financial assets and financial liabilities are disclosed in the
statement of financial position and in the notes to and forming part of the financial statements.

Genea Limited Annual Report 2014 101

Notes to the Consolidated
Financial Statements (cont.)
Financial instruments include:

Consolidated
Carrying amount Fair value Carrying amount Fair value

In AUD ($000) 2014 2013

Cash and cash equivalents 844 844 5,443 5,443
Trade and other receivables 2,584 2,584 2,660 2,660
Trade and other payables (5,525) (5,525) (5,816) (5,816)
Secured bank loan (4,000) (3,929) - -
Bank overdraft (1,431) (1,431) - -
Finance lease liability - - (20) (20)
(7,528) (7,457) 2,267 2,267

Measurement of fair values valuation techniques

All balances, except the secured bank loan, are due to be settled within the next 12 months and approximate fair value.
The secured bank loan is a level 2 financial liability that is valued using discounted cash flows and does not have any
significant unobservable inputs. The Group does not have any level 3 hierarchy financial instruments.

28. Operating leases

Leases as lessee
Non-cancellable operating lease rentals are payable as follows:

Consolidated
In AUD ($000) 2014 2013
Less than one year 4,246 3,634
Between one and five years 15,602 14,354
More than five years 11,712 10,404
31,560 28,392

The Group leases a number of office and lab facilities under non-cancellable operating leases expiring within 1 to 20
years. The leases have varying terms, escalation clauses and renewal rights.
The Group leases various plant and equipment under non-cancellable operating leases.
During the financial year ended 30 June 2014, $3,786,000 was recognised as an expense in the statement of profit or
loss and other comprehensive income in respect of operating leases (2013: $3,344,000). The expense was reduced
by the operating lease incentive of $395,000 (2013: $470,000). In respect of subleases $218,000 (2013: $201,000)
was recognised as income in the statement of profit or loss and other comprehensive income.
102 Notes to the Consolidated Financial Statements
29. Capital and other commitments
At 30 June 2014 the Group had no capital or other commitments not otherwise reflected in the financial statements
(2013: $2.2 million).

30. Contingencies
From time to time through the course of normal operations the Group is exposed to claims in relation to services
provided to patients. The Group has adequate insurance to mitigate any claims arising.
There are no liabilities or exposures to the Group not otherwise reflected in the financial statements.

Guarantees
The terms of certain premises leases entered into by the Company and its subsidiaries include the grant of bank
guarantees to owners of premises for $4,054,000 (2013: $2,786,000). These guarantees are payable on demand and
are secured by a registered mortgage debenture (fixed and floating charge) over the assets of Genea Limited and its
subsidiaries.
The directors are of the opinion that provisions are not required in respect of the above guarantees, as it is not probable
that a future sacrifice of economic benefits will be required or the amount is not capable of reliable measurement.

31. Related party transactions

Identity of related parties
The Group has related party relationships with its subsidiaries (see note 17), equity accounted investees (see note 16)
and its key management personnel.

Transactions with key management personnel

The following persons were directors of Genea Limited during the financial year:

(i) Chairman non-executive

R.A. Ross AM

(ii) Executive director

T. Stojanov

(iii) Non-executive directors

R.P.S. Jansen AM
C.E. Pizzey
D.W. Smithers AM
R.J. Woolcott

Genea Limited Annual Report 2014 103

Notes to the Consolidated
Financial Statements (cont.)
Key management personnel compensation
Key management personnel comprise directors and executives, where executives are those individuals having the
authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, during
the financial year.
The key management personnel compensation included in the statement of profit or loss and other comprehensive
income is as follows:

Consolidated
In AUD 2014 2013
Short-term employee benefits 2,915,977 3,547,018
Long-term employee benefits 9,521 53,742
Share-based payments 15,360 (9,301)
2,940,858 3,591,459

R.A. Ross, R.P.S. Jansen, D.W. Smithers and R.J. Woolcott elected to receive a component of their remunerations as
shares rather than as cash as permitted by a resolution of shareholders. These amounts are included in the statement
of profit or loss and other comprehensive income.

Loans to key management personnel

Under the employee share plan certain employees were granted an interest free, limited recourse loan for the purpose
of acquiring Company shares. Details regarding the aggregate of loans made to key management personnel are as
follows:

Consolidated
In AUD 2014 2013
Loans to key management personnel 61,670 67,480

Other key management personnel transactions

From time to time, key management personnel of the Group may purchase services from the Group. These purchases
are on the same terms and conditions as those entered into by other Group employees or customers and are not
material in nature.

104 Notes to the Consolidated Financial Statements

Other related party transactions
Consolidated
In AUD 2014 2013
Licence fee
Subsidiary 89,212 90,842
Associate 113,672 113,180
Rendering of services
Associate 56,544 36,668
Joint ventures 377,000 213,200
Loans receivable
Associate 42,323 68,467
Joint ventures 920,313 135,527
Dividends received
Joint ventures - 135,913

The parent company of the Group, Genea Limited, charges licence fees to a subsidiary and an equity accounted
investee for the use of the Genea brand name.

Equity accounted investees

Expenses are incurred by the Group on behalf of equity accounted investees. These expenses are reimbursed at
cost. Other transactions with equity accounted investees are priced on an arms length basis. None of the balances is
secured.
To support the activities of Genea Oxford Womens Health Ltd, the Group and the other investor in the joint venture
have agreed to make additional contributions in proportion to their interests to make up any losses, if required (see
note 16). Total current year losses were $544,000 (2013: $Nil).

Genea Limited Annual Report 2014105

Notes to the Consolidated
Financial Statements (cont.)
32. Subsequent events
On 11 July 2014, Company director and founder, Professor Robert Jansen, passed away.
At 1 July 2014 the assets and liabilities of the Genea Genetics Unit Trust were transferred to Genea Limited and the
trust dissolved.
Development of a media production facility for Genea Biomedx at its premises in Kent, UK is expected to be
completed in the next financial year and the building itself acquired, with some financial assistance made available as
grant funding from the local regional development council.
The Group opened a new IVF clinic in St Leonards in August 2014, as part of its program of expanding in important
markets.
In July 2014, the Group incorporated two wholly owned foreign subsidiaries, Genea (UK) Limited in the United
Kingdom and Genea Hong Kong Limited in Hong Kong. Neither subsidiary has commenced operation.
In August 2014, the Company became aware that an independent specialist who utilised the Superior ART (SART)
facility treated a patient engaged in a commercial surrogacy arrangement. Following this incident, the Company has
assisted SART with improvements to its risk governance framework to ensure it is equivalent to Geneas ethical and
risk governance framework.
Other than these matters and those noted elsewhere in the financial statements and notes, there has not arisen in the
interval between the end of the financial year and the date of this report any item, transaction or event of a material or
unusual nature.

106 Notes to the Consolidated Financial Statements

33. Company disclosures
As at, and throughout, the financial year ending 30 June 2014, the parent company of the Group was Genea Limited.

Company
In AUD ($000) 2014 2013
Result of the Company
Profit for the year 19,138 4,858
Other comprehensive income - -
Total comprehensive income for the year 19,138 4,858
Financial position of the Company at year end
Current assets 33,278 10,628
Total assets 56,422 41,134
Current liabilities 13,980 12,965
Total liabilities 18,827 20,539
Total equity of the Company comprising of:
Share capital 10,310 10,108
Equity compensation reserve 163 140
Retained earnings 27,122 10,347
Total equity 37,595 20,595

From 1 July 2013 the assets and liabilities of the Stem Cells & Research division in Genea Limited were transferred to
Genea Biomedx Pty Limited and Genea Biocells Pty Limited, and their activities have been reported separately to the
parent company from that date.
As a result, the R&D expenditure and initial trading losses incurred by these entities are no longer reported in Genea
Limited.

Genea Limited Annual Report 2014 107

Directors declaration
1. In the opinion of the directors of Genea Limited (the Company):
(a) the financial statements and notes, set out on pages 59 to 107, are in accordance with the Corporations Act 2001,
including:
(i) giving a true and fair view of the Companys and the Groups financial position as at 30 June 2014 and of their
performance, for the financial year ended on that date; and
(ii) complying with Australian Accounting Standards (including Australian Accounting Interpretations) and the
Corporations Regulations 2001.
2. The financial report of the Group and the Company also comply with International Financial Reporting Standards as
disclosed in note 2(a);
3. There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable.
4. The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the
Chief Executive Officer and the Chief Financial Officer for the financial year ended 30 June 2014.

Dated at Sydney, this 17th day of September 2014.

Signed in accordance with a resolution of the directors:

R.A. Ross AM T. Stojanov

Chairman Chief Executive Officer

108 Directors Report

Independent Auditors Report to the
members of Genea Limited

Genea Limited Annual Report 2014 109

Lead Auditors Independence Declaration

110 Directors Report

Additional information
1. Shareholding
The shareholder information set out below was applicable at 17 September 2014.

a. Distribution of shareholders
Category (size of
holding) Number of shareholders % of shareholders Number of shares % of shares
1-1,000 98 51.04 34,477 1.21
1,001-5,000 44 22.92 116,671 4.08
5,001-10,000 14 7.29 106,890 3.74
10,001-100,000 30 15.63 942,336 32.95
100,001 and Over 6 3.12 1,659,710 58.02
192 2,860,084

b. Twenty largest shareholders

Name Number of shares % held of issued capital

Anadyomene Pty Ltd <Jansen Unit Trust> 522,347 18.26%
Anadyomene Superannuation Pty Ltd <Jansen Super Fund> 343,716 12.02%
D & P Projects Pty Limited 247,239 8.64%
Woolcott Holdings Pty Limited 232,439 8.13%
Lyneham Robert Carleton 211,237 7.39%
Arven Pty Limited 102,732 3.59%
Kaltip Pty Limited 64,026 2.24%
Mark Bowman Pty Limited 61,591 2.15%
Ross Rowan Alexander 58,195 2.03%
Massy-Greene Roger Brian 56,052 1.96%
Silkmark Pty Limited 53,614 1.87%
Danat Nominees Pty Limited 50,950 1.78%
Trounson Alan 50,000 1.75%
DB Management Pty Limited 49,886 1.74%
Roberts Cynthia 42,671 1.49%
Tolbarno Pty Limited 38,247 1.34%
Grays Inn Pty Limited 34,033 1.19%
Madam Tussauds Waxworks Pty Limited 31,640 1.11%
Rimika Nominees Pty Limited 31,417 1.10%
Livingstone Mark 28,000 0.98%
2,310,032
c. Voting rights
The voting rights attached to the ordinary shares are one vote for each ordinary share when a poll is called, otherwise
each member present at a meeting or by proxy has one vote on a show of hands.

2. Company Secretary
The name of the Company Secretary is Ms Mary Weaver.

3. Address of principal office and register of securities

Genea Limited is incorporated in Australia. The address of the principal office and register of securities is Level 2 321
Kent Street Sydney NSW 2000. Telephone (02) 9229 6420.
Genea Limited Annual Report 2014 111
Company history
1983-88 Seed funding by the founding shareholders and in 1985
Sydney IVF operations commenced.
1989-90 Cytogenetics laboratory established.
Sydney IVF operates profitably.
1990-91 First dividend paid.
Export Market Development Grant from Austrade.
Sydney IVF first qualifies for Industry Research and
Development Board tax incentives.
Sydney IVF takes over provision of public hospital IVF
services at Royal Prince Alfred Hospital, Sydney
1992-93 Bangkok-Sydney IVF Company Limited commenced
operations at the Vichaiyut Hospital, BangkokFirst.
Regional clinic established in Orange.
1994-95 Operations commence at OConnell Street in Sydney.
1995-96 Launceston IVF clinic established as a joint venture with
local gynaecologists in Launceston, Tasmania (operations
ceased 2011).
1996-97 Interest acquired in DNALabs Pty Limited introducing
molecular DNA technology to Sydney IVF (DNALabs
name and testing business sold to Sonic Healthcare in
2010).
1997-98 $1.6 million R&D Start grant awarded to Sydney IVF (total
value of the project $3.2 million).
1998-99 Licensing agreement entered into with Cook IVF to
manufacture and distribute Sydney IVF designed embryo
culture medium worldwide.
Sydney IVF the main supporting organization for the
11th World Congress on IVF and Human Reproductive
Genetics, held at the Sydney Convention Centre, Darling
Harbour and attended by over 2000 delegates.
1999-00 Corporate net profit exceeds $1 million.
Independent Ethics Committee established.
112
2000-01 Joint venture with Sydney Ultrasound for Women for
biochemical screening of early pregnancies.
$2.5 million R&D Start grant awarded to Sydney IVF to
further develop proprietary culture medium, develop DNA
diagnostic chips and to develop miscarriage management
investigations.
U.S. Food and Drug Administration approves Sydney IVF
medium for sale in the United States.
Founding director Dr John Anderson resigns from the
Board.
Sydney IVF becomes an unlisted public company.
Sydney IVF opens a stand-alone IVF clinic in Liverpool
NSW.
2001-02 Sydney IVF acquires 40% in Sydney IVF Newcastle
Pty Limited, a joint venture with Dr Robert Woolcott to
operate established IVF services at Lingard Hospital
Newcastle.
2002-03 Rowan Ross appointed a director and is elected Chairman
of the Board.
Sydney IVF forms Sydney IVF Canberra operating in the
Australian Capital Territory.
Sydney IVF commences Australias first comprehensive
Miscarriage Management Program.
2003-04 Sydney IVFs blastocyst culture and preimplantation
genetic screening techniques receive international
attention as results are published in the U.S.
Sydney IVF achieves four licences for embryo research,
the first such licences to be issued in Australia under new
legislation. The first Australian human embryonic stem
cell line is produced within two months.
2004-05 New clinics established in several further NSW regional
centres.
After almost 20 years, Sydney IVF better captures its
strategic essence of no better chance, no greater care
with a thorough and successful new brand look.
2005-06 Management restructure completed with vertical
accountability in three business divisions.
Sydney IVF produces stem cells to pharmaceutical
standards for Singapore-based client ESI Pte Limited.
Majority share in Perth-based Hollywood Fertility Centre
takes Sydney IVF across Australia.
Fifty percent share in Superior ART, a new PGD clinic in
Bangkok, Thailand.
Company history
2006-07 The Sydney CBD operations move to new premises at
321 Kent Street and celebrates its 21st birthday.
The company is awarded its third major AusIndustry grant,
with $2.7 million (total value of the project $5.5 million)
awarded to develop stem cell-based laboratory assays for
genetic disease-specific new drug development.
2007-08 Sydney IVF receives Australias first national licences to
develop therapeutic cloning.
Our first single-gene-defect stem cells prepared for
research into Huntingtons disease and fascio-scapulo-
humeral dystrophy (FSHD).
2008-09 NorthWest clinic at Bella Vista opened.
Eight of 10 current national embryo research licences are
held by Sydney IVF.
2009-10 
World first molecular method for detecting unbalanced
chromosomes translocation errors in embryos introduced
by Sydney IVF as part of PGD service.
Development of vitrification automation device
commences.
2011-12 Sydney IVF rebranded as Genea.
Genea Holistic services launched.
Superior ART celebrates its 5th anniversary and awarded
Prime Ministers Export Award 2012.
2012-13 Canberra clinic celebrates 10th anniversary.
Orange Clinic celebrates 20th anniversary.
Genea Biocells established as a corporate subsidiary
and brand launched. 25 disease specific embryonic
pluripotent stem cell lines listed on the USA NIH human
stem cell registry Genea Biomedx established as a
corporate subsidiary. Successful brand launch at 2013
ESHRE London.
Third generation embryo culture medium suite launched.
2013-14 Launch of new model of engagement with Fertility
Specialists.
Successful messaging of our 40% Better Chance (based
on ANZARD data).
Successful launch of pathology collection in Kent Street
and selected sites.
Genea Biomedx establishes facility in Sandwich, Kent UK
and a media processing unit in Kent Street, Sydney.
Introduction of Next Generation Sequencing in October
2014.

Genea Limited Annual Report 2014 113

Stages of
embryo development
Unfertilised Ovum (Egg)
About 7 million form before birth, and ~300,000 are present when periods start. All but about 1000 are
used by menopause, an average rate of 700 per month. Only one is released each month, but between
2 and 30 eggs have a chance of ovulating (depending on age) and can be encouraged to do so in an
IVF treatment.
Fertilised Ovum (Pronuclear-Stage Embryo) Single cell
The genetic material (chromosomes) from the sperm and egg are still separate. The next change is
called syngamy whereby the two separate sets of chromosomes combine and create a new and unique
set of chromosomes. The embryo then starts to divide from a single cell to 2 and then 4 cells.

Day 3 Embryo (Cleavage-Stage Embryo) 6 to 8 cells

This is a crucial stage for the embryo when the embryo takes over its own growth and development
from the maternal genome to the embryonic genome. Not all embryos have the necessary requirements
to progress past this point and around 30-50% arrest in growth at this stage.

Day 45 Embryo (Compacting Morula) 16 to 32 cells

The cells have compacted and are no longer distinct. Compaction occurs to increase the
communication between the cells in the embryo to ready for the next transition stage.

Day 56 Embryo (Blastocyst) 64 to 128 cells and more

A cavity has formed between the inner cell mass (ICM), composed essentially of embryonic stem cells, or
ES cells, and the trophectoderm (TE), consisting of trophoblastic, or placentalstem cells. This is the stage
that is most appropriate for an embryo transfer as the uterine environment is ready to accept a blastocyst.

Implantation
Although the blastocyst may be well formed and may be genetically normal, the implantation stage is
crucial and relies on the ability for the uterus and the embryo to signal each other and the blastocyst to
begin to attach and implant into the endometrium (wall of the uterus). If all has gone well the blastocyst
attaches to and burrows into the uterus on day 7.

114 Stages of embryo development

Glossary of
biotechnical terms
Adenosine triphosphate (ATP): a mobile molecule in the cell
capable of delivering energy where it is needed.
Amniocentesis: the sampling of fluid from the amniotic or
gestational sac, usually performed around 14 weeks of pregnancy
to check the genetic normality of the fetus by determining its
karyotype or for performing biochemical tests.
Amplification: see polymerase chain reaction.
Array: a set of identical (or very similar) elements arranged in a
regular pattern, typically on a glass slide or a wafer of silicon (such
as a DNA chip).
ART: assisted reproductive technology
Blastocyst: Stage of development of the embryo in which a
fluid-filled cavity forms in the formerly solid ball of cells (the
morula), about 5 days after fertilization. For the first time, a
distinction can be made between a sheet of cells to one side, which
will form the embryo proper (the inner cell mass), and the remaining,
peripheral cells, which after the blastocyst hatches through the
zona pellucida and undergoes implantation will form the placenta
(the trophectoderm).
CGH: comparative genome hybridisation.
Chorionic villus sampling (CVS): a test performed at about 10
weeks of pregnancy at which, under ultrasound guidance, a
small sample of tissue is taken from the placenta (afterbirth) for
genetic testing, such as a karyotype.
Chromosome: the visible structure formed by a single long
strand of DNA with its supporting and regulatory proteins. There
are 46 chromosomes in the nucleus of every human cell, 22
pairs of autosomes (common to both sexes) and the two sex
chromosomes, XX in a female and XY in a male.
Comparative genomic hybridisation: the genome of a cell is
made to undergo hybridisation with a standard set of genomic
DNA, each genome first being labelled with either a green or red
fluorescent dye; by comparing the resultant colour (which is either
neutralised or deviates towards red or green) it can be determined if
the right amount of DNA is present, or whether some is missing or
present in excess.
Culture medium: a solution of nutrients required for the growth of
an embryo or tissue in culture.
CVS: chorionic villus sampling
Cytogenetics: the study of genetics at the level of the
chromosomes, usually by preparing a karyotype.
Genea Limited Annual Report 2014
Cytoplasm: The part of a cell that is not the nucleus (the nucleus
contains the chromosomes). The cytoplasm is contained by the cells
plasma membrane and contains all the other cellular structures,
including the mitochondria. Genetic inheritance is mostly by way of
the nucleus (with a contribution from mother and father); a small
part is by way of the cytoplasm (with a contribution only from the
mother). Its the cytoplasm of the egg into which a sperm cell is
injected in the process of intracytoplasmic sperm insertion (ICSI).
Diploid: a cell, nucleus or organism having a double (i.e. paired) set
of each chromosome - the normal state for most cells.
DNA: deoxyribose nucleic acid, a molecule made up of a sequence
of nucleotides, the order of which forms the genetic code.
DNA amplification: see polymerase chain reaction.
Down syndrome: a genetic disability caused by the presence of a
third copy of chromosome 21.
Egg or Ovum (pl. ova): The female sex cell, or egg, from the
earliest stage, through its release from the follicle (ovulation),
and (to professional embryologists) through fertilization up to and
sometimes beyond the stage of implantation.
Embryo: The word is used loosely to describe everything from
a fertilised egg to a fetus. What many people nowadays call
the embryo has for long been called the ovum by professional
embryologists. Up to the time that the embryo would normally
implant in the uterus (as a blastocyst), any of the cells of the
fertilised ovum can develop into a whole new embryo - they are
totipotent. After implantation a group of cells (the inner cell mass)
differentiates to form the embryo itself (later the fetus), whereas
remaining cells go on to form afterbirth tissues, namely the
pregnancy membranes and placenta.
Embryo biopsy: the procedure whereby one or two cells are
removed from an embryo (usually performed at the 8-cell stage, on
Day 3 after fertilisation) for genetic analysis.
Embryonic disc: Derived from the inner cell mass. The part of the
implanted embryo that will form the embryo itself, i.e. the fetus.
Fertilisation: the fusion of the male and female gametes, a
spermatozoon with an oocyte to form an embryo and, potentially to
create a new individual.
FISH: fluorescent in-situ hybridisation. Fluorescent in-situ
hybridisation (FISH): a technique using fluorescently tagged
pieces of synthetic DNA (probes) to label particular regions
of a chromosome so that it can be seen under a fluorescence
microscope using ultraviolet light.
Gamete (pl. gametes): the generic term for a male or female germ
cell, i.e. the spermatozoon or oocyte.
115
Glossary of
biotechnical terms (cont.)
Gene: a specific part of the DNA that contains the genetic code for
a single molecule such as an enzyme or other protein.
Genome: the entire genetic code of an individual cell or organism.
Haploid: a cell, nucleus or organism having a single (unpaired) set
of chromosomes.
HLA: surface proteins present on most cells (including the fetus)
and responsible for immune recognition or rejection.
Hybridisation: the matching of two complementary strands of DNA.
Implantation: the process whereby the blastocyst-stage embryo
burrows into the lining of the uterus to establish a pregnancy.
In vitro fertilisation (IVF): literally, fertilisation in glass (but
in reality in plastic). This technique, whereby oocytes and
spermatozoa are mixed in the laboratory to achieve fertilisation, is
used as a treatment for infertility when the process has not occurred
naturally inside the womans body.
Karyotype: a preparation made from one or more cells in the
laboratory to study whether an individual has a normal set of
chromosomes. A normal male is 46, XY
while a normal female is 46, XX. See also Down syndrome.
Meiosis: the process of division of cells destined to become sperm
or egg cells by which the number of chromosomes is reduced
to half (i.e. a single copy of each). The process is circuitous:
the chromosomes are first doubled, then halved twice (so a
sperm-precursor cell produces four haploid sperm; but a precursor
egg cell produces only one oocyte, the spare chromosomes being
shed in the two polar bodies).
Mitochondrion (pl. mitochondria): structures inside every cell
that resemble bacteria. These are the site of metabolism where
carbohydrates are oxidised to release energy, which is stored as
ATP for use around the cell.
Mutation: a change in the coding sequence of a gene usually
altering its function, often causing harm.
Next Generation Sequencing Technology (NGS): a type of
genome sequencing used to detect specific gene errors.
Non-invasive Pre-natal Screening (NIPS): a method for
detecting trisomy 21 by extracting and analysing the DNA from a
foetus which is present in a sample of blood taken from the mother.
Nucleotide: one of the molecular building blocks of DNA. A set of
three nucleotides forms one letter in the genetic code.
Nucleus: the central part of each cell where the genetic code
carried in the chromosomes resides.
Oocyte: the scientific term for the unfertilised egg.
116
OPU: oocyte pick up, the term used to describe the clinical
procedure during which unfertilised eggs are collected from a
womans ovaries.
Passaging: subculture of cells to enable replication (multiplication)
without differentiation or specialisation.
PCR: polymerase chain reaction.
PGD: preimplantation genetic diagnosis.
Polar body: one of the two small cell fragments produced and
discarded during each of the two cell divisions that comprise
meiosis in women, subsequently yielding a haploid egg.
Polymerase chain reaction (PCR): a molecular genetic technique
that allows a single copy of a genetic sequence to be amplified
geometrically to produce vast numbers of copies that can then be
measured and analysed. It uses a thermostable DNA polymerase
enzyme that replicates DNA and a repetitive sequence of warm-to-
hot-and-back-again temperature shifts in a thermal cycler machine
to produce copies of a particular region of the genetic code located
between a pair of specifically chosen primers.
Polymorphism: a variation of a gene comparable to a mutation but
common enough in the population not to be strictly abnormal; may
be advantageous or disadvantageous, depending on circumstances.
Preimplantation genetic diagnosis (PGD): testing performed on
the embryo involving embryo biopsy and analysis of one or two cells
using genetic techniques such as FISH or PCR.
Sequence: the specific order of nucleotides, the basic building
blocks of DNA, in a gene. This can be determined using an
automated sequencer machine.
Spermatozoon (pl. spermatozoa): the scientific term for the male
sex cell, often referred to as the sperm.
Stem cell: A cell in the embryo, child or adult capable of dividing
repeatedly without itself aging appreciably, and retaining the ability
to form different types of tissues depending on local circumstances.
Embryonic stem cells form normally in the embryonic disc. Fully
formed tissues also contain stem cells, but such adult stem cells
are perhaps a little more committed to forming tissues of a
restricted range. Researchers are interested in both forms of stem
cells for possible future treatments of degenerative diseases such
as diabetes, Alzheimers disease, Parkinsons disease and many
others, as well as cells to replace tissues or organs destroyed by
cancer or cancer treatment.
Stem cell line: The clonal derivation of a population of cells from a
single precursor stem cell that retain the properties of
stem cells.
Glossary of biotechnical terms
Location
& Contacts
NSW Newcastle Maitland
Metropolitan clinics Suite 2, 23 Merewether Street Maitland Private Hospital
Merewether NSW 2291 173 Chisholm Road
Sydney CBD p +61 2 4902 7000 East Maitland NSW 2323
Level 2, 321 Kent Street f +61 2 4965 3721 p +61 2 4902 7000
Sydney NSW 2000 f +61 2 4965 3721
p +61 2 9229 6420 Regional clinics
f +61 2 9233 7519 Central Coast
Tamworth
31 Hills Street
Bella Vista Suite 6, 32-34 Marius Street
Gosford NSW 2250
Tamworth NSW 2340
Suite 101, 10 Norbrik Drive p 0437 436 677
p +61 2 6766 7903
Bella Vista NSW 2153 f +61 2 4965 3721
f +61 2 6766 7325
p +61 2 8919 8000
f +61 2 8883 4380 Orange ACT
Liverpool 3 Hampden Avenue Canberra
Orange NSW 2800
173-175 Bigge Street Ground Floor, 2 King Street
p +61 2 6362 0530
Liverpool NSW 2170 Deakin ACT 2600
f +61 2 6360 1885
p +61 2 8734 3300 p +61 2 6260 3400
f +61 2 8734 3399 Lismore f +61 2 6260 3466

Manly Lismore Private Day Surgery

79 Uralba Street WA
Level 5, 22 Darley Road Lismore NSW 2480
Manly NSW 2095 Hollywood Fertility Centre - Perth
p +61 2 6622 6665
p +61 2 8484 1515 f +61 2 6622 8454 Hollywood Private Hospital
f +61 2 8484 1595 Monash Avenue
Coffs Harbour Nedlands WA 6009
St Leonards p +61 8 9389 4200
Suite 1, 71 Albany Street
The Forum, Suite 3.02, Coffs Harbour NSW 2450 f +61 8 9386 1463
Level 3, 205 Pacific Highway p +61 2 6650 0442
St Leonards NSW 2065 f +61 2 6651 8309
p +61 2 9437 0988
f +61 2 9437 9077 Port Macquarie
Wollongong 57 Lake Road
Ground Floor, 1 Rawson Street Port Macquarie NSW 2444
Wollongong NSW 2500 p +61 2 6583 4922
p +61 2 4242 9000 f +61 2 6583 9496
f +61 2 4242 9090

Genea Limited Annual Report 2014 117