29/08/17: Appendix 4E Annual Report – 30 June 2017

ASX Release

29 August 2017

AllegraJn ORTHOPAEDICS

Human Movement Technology

Financial Report 30 June 2017

Iam pleased to present Allegra Orthopaedics Limited's ('Allegra') Appendix 4E and Annual Report for the year ended 30 June 2017.

FY2017 has been a significant year of achievements at Allegra as the company successfully continues to execute on its strategic plan.These achievements include:

• Improved NPAT profit of $501k, which is a $2.537M improvement on our FY2016 result and the most significant profit achieved by the company since listing on the ASX.

• Reduced the company's loans balances to $150k at 30 June 2017 compared to FY2016 where we had $1.078M of loans

• Improved cash balances at 30 June 2017 with cash & cash equivalents of $1.848M compared to

  $1.lSSM at 30 June 2016

• Continued expansion of our customer surgeon base which will pave the way to improved revenues.

• Significant progress of our Sr-HT Garhnite Bone Substitute project, with positive results from the 12 month histology testing and clinical sheep study. Allegra's Innovation Division is now setting up a pilot manufacturing facility in Lane Cove as part of this commercialisation project

• Continued to maintain strong shareholder support as indicated by the substantially oversubscribed shareholder rights issue in April 2017 raising $1,219,023 in new capital for the company. (refer ASX announcement on 12 April 2017)

Allegra's Orthopaedic Division continues to perform well with new products continually being evaluated to bring to market. Our goal is to ensure Allegra is delivering products and services which our customers want. We intend to stay ahead of the curve in terms of orthopaedics products offered.

With regard to our Innovation Division, engagement and collaboration with surgeons, universities and companies are key goals. We aim to deliver a positive impact to the market with our Sr-HT-Gahnite Bone Substitute technology commencing with our spinal custom cage. Our recent collaboration with Bone, Ligament, Tendon Pty Ltd (BLT) will add yet another dimension to this division

urnaround in Allegra's performance over the last 12 months. incerely

Lastly, I would like to thank my fellow directors, Allegra management and staff for the significant t

S

Peter Kazacos

Non-Executive Chairman

Allegra Orthopaedics Limited

Level 8, 18-20 Orion Road Lane Cove NSW 2066 Australia; PO Box 72 St Leonards NSW 2065 Australia

T [phone] T Toll Free 1800 644 370

F [phone] F Toll Free 1800 624 223

E sales@allegraorthopaedi cs.com W www .allegraorthopaedics.com

1. Company details

Nam ABN:

of entity:

Allegra Orthopaedics Limited 71 066 281 132

Reporting period: Previous period:

For the year ended 30 June 2017 For the year ended 30 June 2016

2. Results for announcement to the market	$
Revenues from ordinary activities	down	1.5%	to	4,943,216
Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA)	up	160.7%	to	894,965
Profit from ordinary activities after tax attributable to the owners of Allegra Orthopaedics Limited	up	124.6%	to	501,048
Profit for the year attributable to the owners of Allegra Orthopaedics Limit d	up	124.6%	to	501,048

Dividends

There were no dividends paid, recommended or declared during the current financial period.

Comments

The

profit for the

consolidated entity after providing for income tax amounted to $501,048 (30

June 2016:

loss of

$2,035,788).

Further information on the review of operations, financial position and future strategies is detailed in the Review of operations section of the Directors' report which is part of the Annual Report.

The

earnings before interest, tax, depreciation and

amortisation ('EBITDA') was a profit of $894,965 (2016:

loss of

$1,474,094).

On 13 December 2016, the company announced that it had issued 9,438,957 fully paid ordinary shares at an issue price of

$0.08 per share. The $755,117 raised was used to repay a loan of $700,000 owing to Robinwood Investments Pty Ltd (related party) which had been drawn down prior to 30 June 2016 (refer ASX announcement dated 30 June 2016).

On 13 April 2017, the company issued 9,388,269 fully paid ordinary shares at an issue price of $0.125 per share. A further

363,912 fully paid ordinary shares allocated to partie

related to directors will be issued subject to shareholder approval.

The $1,219,023 raised will be used to continue funding the SR-HT-Gahnite bone substitute project and increase its investment in surgical instrumentation and inventory.

EBITDA is a financial measure which is not prescribed by Australian Accounting Standards ('AAS') and represents the profit under AAS adjusted for non-specific and significant items. The directors consider EBITDA to reflect the core earnings of the consolidated entity.

The following table summarises key reconciling items between statutory loss after tax attributable to the shareholders of the company and EBITDA.

Consolidated

2017

$

2016

$

Profit/(loss) after income tax

Add: Depreciation and amortisation

501,048 (2,035,788)

290,667 514,780

Add: Finance cost

111,292

68,269

Less: Interest income

(8,042) (21,355)

EBITDA

894,965 (1,474,094)

1. Net tangible assets

   Reporting period

   Previous period

   Cents Cents

   Net tangible assets per ordinary security

   5.33 3.13

2. Control gained over entities

   Not applicable.

3. Loss of control over entities

   Not applicable.

4. Dividend reinvestment plans

   Not applicable.

5. Details of associates and joint venture entities

   Not applicable.

6. Fo eign entities

   Details of origin of accounting standards used in compiling the report:

   Not applicable.

7. Audit qualification or review

   Details of audit/review dispute or qualification (if any):

   The financial statements have been audited and an unqualified opinion has been issued.

8. Attachments

   Details of attachments (if any):

   The Annual Report of Allegra Orthopaedics Limited for the year ended 30 June 2017 is attached.

9. Signed

Signed

Date: 29 August 2017

Peter Kazacos Director Sydney