We refer to the Company's quarterly cashflow report in the form of Appendix 5B for the period ended 31 March 2003, released to Australian Stock Exchange Limited ("ASX") on 30 April 2003 (the "Appendix 5B").
ASX notes that the Company has reported the following.
1. Receipts from product sales, and related debtors of $189,000.
2. Net negative operating cash flows for the quarter of $97,000.
3. Cash at end of quarter of $82,000.
In light of the information contained in the Appendix 5B, please respond to each of the following questions.
1. It is possible to conclude on the basis of the information provided that if the Company were to continue to expend cash at the rate for the quarter indicated by the Appendix 5B, the Company may have sufficient cash to fund its activities for the next quarter only. Is this the case, or are there other factors that should be taken into account in assessing the Company's position?
2. Does the Company expect that in the future it will have negative operating cash flows similar to that reported in the Appendix 5B for the quarter and, if so, what steps has it taken to ensure that it has sufficient funds in order to continue its operations at that rate?
3. Please comment on the Company's compliance with listing rule 12.2, with reference to the matters discussed in the note to the rule.
4. Can the Company confirm that it is in compliance with the listing rules, and in particular, listing rule 3.1?
LISTING RULE 3.1
Listing rule 3.1 requires an entity to give ASX immediately any information concerning it that a reasonable person would expect to have a material effect on the price or value of the entity's securities. The exceptions to this requirement are set out in the rule.
In responding to this letter you should consult listing rule 3.1 and the guidance note titled "Continuous disclosure:- listing rule 3.1".
If the information requested by this letter is information required to be given to ASX under listing rule 3.1 your obligation is to disclose the information immediately.
Your responsibility under listing rule 3.1 is not confined to, or necessarily satisfied by, answering the questions set out in this letter.
This letter and your response will be released to the market. If you have any concerns about your response being released, please contact me immediately. Your response should be sent to me on facsimile number (08) 9221 2020. It should not be sent to the Company Announcements Office.
Unless the information is required immediately under listing rule 3.1, a response is requested as soon as possible and, in any event, before the close of business (ie before 5.00 pm WST) on Monday, 12 May 2003.
If you are unable to respond by the time requested you should consider a request for a trading halt in the Company's securities.
Should you have any queries regarding any of the above, please do not hesitate to contact me.
