Ann: Quarterly Report and Appendix 4C, page-26

Hi all
looking to address some concerns that I have with SDV. I've continued doing my due diligence and I'm keen to invest (again) into the company, especially seeing the large growth in revenue (irrespective of it being inorganic via acquisitions).

I was having a look through the annual report and it mentions that Lewis Utting, John Fehon & Heath Roberts took a pay hit between 20-30% for the September quarter to alleviate some COVID pressure. Considering Utting is remunerated in excess of $500k and the other two around $250k, it does equate to a noteworthy amount, especially when considering the Net profit before tax of $500k. Considering the reduction in salary that said parties took, that would drop NPBT by at least $60k to ~$440k. That figure would drop NPAT to sub $300k profit from almost $10m revenue. That does not make for good reading. I know I've touched on the above before but I'm still yet to feel satisfied with a response. I will be bringing it up in the AGM, so hopefully I can receive some clarity there. Running trials at material cost/free labour and also the front end heavy set ups in terms of dedicated staff to get trials across the line are two reasons that I can understand. $300k from $9,400,000 is ~3% though, so it either means we've got a serious flaw in our model, or we have a sh!t tonne of trials running atm at a loss bringing our margins down massively.

Another thing of note that isn't specifically related to this quarterly but certainly is overall are the concerns I have re the huge holdings Lewis Utting and Simone Watt have, both in excess of 5,000,000 shares! I haven't gone back to see in what sort of tranches they were given to them, but it makes their recent buying relatively immaterial. *Any info here would be greatly appreciated*

I'm also a little uncomfortable with Lewis Utting being remunerated with a base of $450k, STIs of $200k and LTIs $250k. Seems excessive for a company that is yet to break even.

I know revenue has increased but that's largely thanks to the acquisitions of pro sol and HFT.
Oh! 1 thing I did like seeing that was unexpected was the percentage of revenue borne from work in Australia. That alleviated some of the concerns I had re travel restrictions.