At face value the Polynovo 1H22 report looks positive with NPAT of $1.62 million, or 24 cps.

However, there is the non-IFRS explanation of an underlying loss due to share-based payments expense of ($3,751,237) which includes the “reversal of share awards and share options of $4,708,151 forfeited by the CEO and COO upon their resignations.”

This looks significant but I’m not an accountant. Is there someone from the Strawman community that can help explain whether the company has made a profit or not? It appears not!

Cheers,

Rick

Extract from Appendix 4D below:

Financial Result

The Group recorded revenue of $18,154,456 (2020: $12,796,363) for the Period. The net profit of the Group attributable to members of the parent entity for the Period, after income tax was $1,618,550 (2020: loss of $3,357,743). Net profit before income tax was $1,692,599 (2020: loss of $3,510,260). The net profit includes share-based payments expense of ($3,751,237)(2020: $1,233,724) and an unrealised foreign exchange gain of $376,092 (2020: loss of $1,436,135). The share-based payments expense of ($3,751,237) includes the reversal of share awards and share options of $4,708,151 forfeited by the CEO and COO upon their resignations.

To assist in the evaluation of the financial performance of the Group, certain measures are used that are not recognised under the Australian Accounting Standards or International Financial Reporting Standards (‘IFRS’) and therefore, these are non-IFRS measures. The underlying loss is reported below to give information to shareholders and to provide a greater understanding of the performance of the Group. Share based payments and unrealised forex gain/(loss) are non-cash expenses and by excluding, this details the underlying profit/(loss). Refer to the reconciliation of the underlying and reported financial information below.