##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2011
 Universal Biosensors, Inc.
  Delaware
    
    98-0424072(State or other jurisdiction of incorporation
    
    (I.R.S. Employer Identification Number)or organization)Universal Biosensors, Inc.1 Corporate Avenue,Rowville, 3178, VictoriaAustralia
    
    Not Applicable(Address of principal executive offices)
    
    (Zip Code)
 Telephone: +61 3 9213 9000  (Registrants telephone number,
including area code)
 þ o
 o o
  Large accelerated filer o   
    Accelerated filer þ
    Non-accelerated filer o
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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##### 



UNIVERSAL BIOSENSORS, INC.
 TABLE OF CONTENTS
 PagePART I FINANCIAL INFORMATIONItem 1 Financial Statements1) Consolidated condensed balance sheets at March 31, 2011 and
December 31, 2010 (unaudited)
    
    
    32) Consolidated condensed statements of operations for the three
months ended March 31, 2011 and 2010 (unaudited)
    
    
    43) Consolidated condensed statements of changes in stockholders
equity and comprehensive income for the period ended March 31,
2011 (unaudited)
    
    
    54) Consolidated condensed statements of cash flows for the three
months ended March 31, 2011 and 2010 (unaudited)
    
    
    65) Notes to consolidated condensed financial statements (unaudited)
    
    
    7Item 2 Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    20Item 3 Quantitative and Qualitative Disclosures About Market Risk
    
    
    28Item 4 Controls and Procedures
    
    
    29PART II OTHER INFORMATIONItem 1 Legal Proceedings
    
    
    30Item 1A Risk Factors
    
    
    30Item 2 Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    30Item 3 Defaults Upon Senior Securities
    
    
    30Item 4 [Removed and Reserved]
    
    
    30Item 5 Other Information
    
    
    30Item 6 Exhibits
    
    
    30Exhibit 31.1Exhibit 31.2Exhibit 32.0SIGNATURES
    
    
    31EX-31.1EX-31.2EX-32
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##### Table of Contents



Universal Biosensors, Inc.
 
 Item 1 Financial Statements
 
 Consolidated Condensed Balance Sheets

(Unaudited)
 March 31,
    
    
    December 31,2011
    
    
    2010A$
    
    
    A$ASSETSCurrent assets:Cash and cash equivalents
    
    
    20,571,889
    
    
    
    23,271,766Inventories, net
    
    
    3,059,242
    
    
    
    3,191,093Accounts receivable
    
    
    1,485,448
    
    
    
    3,588,798Prepayments
    
    
    555,448
    
    
    
    303,181Other current assets
    
    
    1,085,998
    
    
    
    356,196Total current assets
    
    
    26,758,025
    
    
    
    30,711,034Property, plant and equipment
    
    
    32,830,029
    
    
    
    32,713,280Less accumulated depreciation
    
    
    (10,404,682
    )
    
    
    (9,586,365
    )Property, plant and equipment  net
    
    
    22,425,347
    
    
    
    23,126,915Total assets
    
    
    49,183,372
    
    
    
    53,837,949LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    
    278,125
    
    
    
    1,764,364Accrued expenses
    
    
    1,598,722
    
    
    
    2,099,477Employee entitlements provision
    
    
    684,057
    
    
    
    596,294Total current liabilities
    
    
    2,560,904
    
    
    
    4,460,135Non-current liabilities:Asset retirement obligations
    
    
    2,040,214
    
    
    
    1,998,060Employee entitlements provision
    
    
    151,356
    
    
    
    160,675Total non-current liabilities
    
    
    2,191,570
    
    
    
    2,158,735Total liabilities
    
    
    4,752,474
    
    
    
    6,618,870Commitments and contingencies
    
    
    
    
    
    
    Stockholders equity:Preferred stock, $0.01 par value. Authorized 1,000,000 shares;
issued and outstanding nil in 2011 (2010: nil)Common stock, $0.0001 par value. Authorized 300,000,000
shares; issued and outstanding 159,008,161
shares in 2011 (2010: 158,871,495)
    
    
    15,901
    
    
    
    15,887Additional paid-in capital
    
    
    77,293,754
    
    
    
    77,034,717Accumulated deficit
    
    
    (29,533,213
    )
    
    
    (22,922,688
    )Current year earnings/(loss)
    
    
    (3,047,232
    )
    
    
    (6,610,525
    )Accumulated other comprehensive income
    
    
    (298,312
    )
    
    
    (298,312
    )Total stockholders equity
    
    
    44,430,898
    
    
    
    47,219,079Total liabilities and stockholders equity
    
    
    49,183,372
    
    
    
    53,837,949
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Universal Biosensors, Inc.
 
 Consolidated Condensed Statements of Operations

(Unaudited)
 Three Months Ended March 31,2011
    
    2010A$
    
    A$RevenueRevenue from products
    
    $
    3,319,401
    
    
    $
    1,524,813Revenue from services
    
    
    245,920
    
    
    
    1,893,133Total revenue
    
    
    3,565,321
    
    
    
    3,417,946Operating costs & expensesCost of goods sold (1)
    
    
    3,492,052
    
    
    
    1,538,436Cost of services
    
    
    63,519
    
    
    
    246,064Research and development (2 and 3)
    
    
    1,747,507
    
    
    
    1,554,227General and administrative (4)
    
    
    1,405,358
    
    
    
    1,469,609Total operating costs & expenses
    
    
    6,708,436
    
    
    
    4,808,336Profit/(loss) from operations
    
    
    (3,143,115
    )
    
    
    (1,390,390
    )Other income/(expense)Interest income
    
    
    224,875
    
    
    
    305,019Interest expense
    
    
    
    
    
    
    Fee income
    
    
    
    
    
    
    Other
    
    
    (128,992
    )
    
    
    (10,291
    )Total other income/(expense)
    
    
    95,883
    
    
    
    294,728Net profit/(loss) before tax
    
    
    (3,047,232
    )
    
    
    (1,095,662
    )Income tax benefit/(expense)
    
    
    
    
    
    
    Net profit/(loss)
    
    $
    (3,047,232
    )
    
    $
    (1,095,662
    )Basic and diluted net loss per share
    
    $
    (0.02
    )
    
    $
    (0.01
    )Average
weighted number of shares used as
denominator
    
    
    158,952,569
    
    
    
    157,229,023Notes :1 Includes non-cash compensation expense (cost of
goods sold)
    
    $
    20,428
    
    
    $
    40,6882 Net of research grant income in these amounts
    
    $
    
    
    
    $
    3 Includes non-cash compensation expense (research
and development)
    
    $
    99,114
    
    
    $
    245,9684 Includes non-cash compensation expense (general
and administrative)
    
    $
    73,383
    
    
    $
    172,130
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Universal Biosensors, Inc.
 
 Consolidated Condensed Statements of Changes in Stockholders Equity and Comprehensive Income

(Unaudited)
 Additional
    
    
    
    
    
    Other
    
    TotalOrdinary shares
    
    Paid-in
    
    Accumulated
    
    Comprehensive
    
    StockholdersShares
    
    Amount
    
    Capital
    
    Deficit
    
    Income
    
    EquityA$
    
    A$
    
    A$
    
    A$
    
    A$Balances at January 1, 2010
    
    
    157,155,933
    
    
    
    15.716
    
    
    
    74,566,698
    
    
    
    (22,922,688
    )
    
    
    (345,724
    )
    
    
    51,314,002Comprehensive incomeGain on derivatives and hedges, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    47,412
    
    
    
    47,412Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,095,662
    )
    
    
    
    
    
    
    (1,095,662
    )Total Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,048,250
    )Exercise of stock options issued to employees
    
    
    145,578
    
    
    
    14
    
    
    
    79,356
    
    
    
    
    
    
    
    
    
    
    
    79,370Shares issued to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock option expense
    
    
    
    
    
    
    
    
    
    
    458,786
    
    
    
    
    
    
    
    
    
    
    
    458,786Balances at March 31, 2010
    
    
    157,301,511
    
    
    
    15,730
    
    
    
    75,104,840
    
    
    
    (24,018,350
    )
    
    
    (298,312
    )
    
    
    50,803,908Balances at January 1, 2011
    
    
    158,871,495
    
    
    
    15,887
    
    
    
    77,034,717
    
    
    
    (29,533,213
    )
    
    
    (298,312
    )
    
    
    47,219,079Comprehensive incomeGain on derivatives and hedges, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,047,232
    )
    
    
    
    
    
    
    (3,047,232
    )Total Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,047,232
    )Exercise of stock options issued to employees
    
    
    136,666
    
    
    
    14
    
    
    
    66,112
    
    
    
    
    
    
    
    
    
    
    
    66,126Shares issued to employees
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock option expense
    
    
    
    
    
    
    
    
    
    
    192,925
    
    
    
    
    
    
    
    
    
    
    
    192,925Balances at March 31, 2011
    
    
    159,008,161
    
    
    
    15,901
    
    
    
    77,293,754
    
    
    
    (32,580,445
    )
    
    
    (298.312
    )
    
    
    44,430,898
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Universal Biosensors, Inc.
 
 Consolidated Condensed Statements of Cash Flows

(Unaudited)
 Three Months Ended March 31,2011
    
    2010A$
    
    A$Cash flows from operating activities:Net loss
    
    
    (3,047,232
    )
    
    
    (1,095,662
    )Adjustments to reconcile net loss to net cash used in
operating activities:Depreciation and impairment of plant & equipment
    
    
    821,660
    
    
    
    725,400Share based payments expense
    
    
    192,925
    
    
    
    458,786Loss on fixed assets disposal
    
    
    4,669
    
    
    
    Change in assets and liabilities:Inventory
    
    
    131,851
    
    
    
    81,160Accounts receivables
    
    
    2,295,850
    
    
    
    (2,472,125
    )Prepaid expenses and other current assets
    
    
    (1,145,187
    )
    
    
    (460,932
    )Employee entitlements
    
    
    78,444
    
    
    
    40,386Accounts payable and accrued expenses
    
    
    (1,434,070
    )
    
    
    87,852Net cash provided by/(used in) operating
activities
    
    
    (2,101,090
    )
    
    
    (2,635,135
    )Cash flows from investing activities:Instalment payments to acquire plant and equipment
    
    
    
    
    
    
    (811,303
    )Purchases of property, plant and equipment
    
    
    (664,913
    )
    
    
    (154,448
    )Net cash used in investing activities
    
    
    (664,913
    )
    
    
    (965,751
    )Cash flows from financing activities:Proceeds from stock options exercised
    
    
    66,126
    
    
    
    79,370Net cash provided by/(used in) financing
activities
    
    
    66,126
    
    
    
    79,370Net increase/(decrease) in cash and cash equivalents
    
    
    (2,699,877
    )
    
    
    (3,521,516
    )Cash and cash equivalent at beginning of period
    
    
    23,271,766
    
    
    
    31,291,011Cash and cash equivalents at end of period
    
    
    20,571,889
    
    
    
    27,769,495
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Universal Biosensors, Inc.
 
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 Organization of the Company
 Commonwealth of Australia
      7




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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 Interim Financial Statements
   Basis of Presentation
    Summary of Significant Accounting Policies
 Principles of Consolidation
  Use of Estimates
  Cash & Cash Equivalents
  8




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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 Short-Term Investments (Held-to-maturity)
  Concentration of Credit Risk and Other Risks and Uncertainties
  Derivative Instruments and Hedging Activities
 Derivative financial instruments
   Cash flow hedges
     9




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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 Inventory
  Three Months Ended
    
    Year EndedMarch 31, 2011
    
    December 31, 2010A$
    
    A$Raw materials  at cost
    
    
    2,798,689
    
    
    
    2,798,045Work in progress  at cost
    
    
    77,639
    
    
    
    188,629Finished goods  at cost
    
    
    182,914
    
    
    
    204,4193,059,242
    
    
    
    3,191,093
 Receivables
  Property, Plant, and Equipment
   March 31, 2011
    
    December, 31 2010A$
    
    A$Plant and equipment
    
    
    15,951,220
    
    
    
    15,110,554Leasehold improvements
    
    
    8,831,425
    
    
    
    8,810,036Capital work in process
    
    
    8,047,384
    
    
    
    8,792,69032,830,029
    
    
    
    32,713,280Accumulated depreciation
    
    
    (10,404,682
    )
    
    
    (9,586,365
    )Property, plant & equipment, net
    
    
    22,425,347
    
    
    
    23,126,915
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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
   Research and Development
   Three Months Ended March 31,2011
    
    2010A$
    
    A$Research and development expenses
    
    
    1,747,507
    
    
    
    1,554,227Research grants received recognized against related
research and development expenses
    
    
    
    
    
    
    Research and development expenses as reported
    
    
    1,747,507
    
    
    
    1,554,227
 Income Taxes
    Asset Retirement Obligations
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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
    Three Months Ended
    
    Year EndedMarch 31, 2011
    
    December 31, 2010A$
    
    A$Opening balance at January 1
    
    
    1,998,060
    
    
    
    1,842,547Accretion expense
    
    
    42,154
    
    
    
    155,513Ending balance at December 31
    
    
    2,040,214
    
    
    
    1,998,060
 Fair Value of Financial Instruments
  
    
    Market approach  based on market prices and other information from market transactions
involving identical or comparable assets or liabilities.
    
    Cost approach  based on the cost to acquire or construct comparable assets less an
allowance for functional and/or economic obsolescence.
    
    Income approach  based on the present value of a future stream of net cash flows
  
    
    Quoted prices for identical assets or liabilities in active markets (Level 1 inputs)
    
    Quoted prices for similar assets or liabilities in active markets or quoted prices for
identical or similar assets or liabilities in markets that are not active or are directly
or indirectly observable (Level 2 inputs)
    
    Unobservable inputs that reflect estimates and assumptions (Level 3 inputs)
 Impairment of Long-Lived Assets
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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 Australian Goods and Services Tax (GST)
  Revenue Recognition
 Revenue from products and services and milestone payment
     
    
    milestone payment. The Company received a milestone payment in December 2009;
 
    
    contract manufacturing. One of two pricing methodologies will apply depending on
whether we are manufacturing above or below a specified quantity of blood glucose tests strips
in a quarter. If less than the specified quantity of test strips is produced within a
quarter, we are considered to be in the interim costing period. In the interim costing
period, the Company is not expected to generate manufacturing profit, but is expected to
recover most of its glucose manufacturing costs. As manufactured volumes increase beyond the
specified quantity of blood glucose test strips per quarter, the interim costing period will
cease to apply and a different pricing methodology will apply, at which time we expect our
blood glucose manufacturing operations to be profitable. We were in the interim costing
period during the first quarter of 2011; and
 
    
    product enhancement. A service fee based on the number of strips sold by LifeScan
is payable to us as an ongoing reward for our services and efforts to enhance the product.
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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
     (1)
    
    as we perform the servicesUnder the terms of our arrangement with LifeScan, we provide certain services relating
to the blood glucose field. In accordance with ASC 605  Revenue Recognition (formerly
Emerging Issues Task Force (EITF) Issue 99-19), revenue has been recognized on a gross
basis as the Company has earned revenue from the provision of services. Other factors which
management considered, which support the gross basis of revenue recognition are as follows:
 
    
    the Company was responsible for providing the service and was also the primary
obligor with respect to purchasing goods and services from third party suppliers which
in turn were used to provide services to LifeScan;
    
    the Company had unmitigated general inventory risk;
    
    the Company had credit risk; and
    
    pricing was not fixed but determined by the level of activity.
 The principles of revenue recognition in ASC 605 have all been satisfied; services were
performed by us which were supported by purchase orders issued by LifeScan on a regular
basis, collection was assured, delivery of the services had occurred and the amount was
objectively determined.(2)
    
    on a proportional performance basis where revenues is related to costs incurred in providing
the services required under the contractThe proportional performance method used to recognize revenue is appropriate as the contract
amount was
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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 determined prior to the commencement of the service, LifeScan receives value as
the services are performed and LifeScan need not re-perform the services that it has already
received from the Company should the service arrangement be terminated.
 Interest revenue
  Foreign Currency
 Functional and reporting currency
   Transactions and balances
    
    
    assets and liabilities for each balance sheet item reported are translated at the closing
rate at the date of that balance sheet;
 
    
    income and expenses for each income statement are translated at average exchange rates
(unless this is not a reasonable approximation of the effect of the rates prevailing on the
transaction dates, in which case income and expenses are translated at the dates of the
transactions); and
 
    
    all resulting exchange differences are recognized as a separate component of equity.
  Commitments and Contingencies
  15




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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 Patent and License Costs
  Clinical Trial Expenses
   Leased Assets
  Stock-based Compensation
   Grant DateMar-11
    
    Nov-10
    
    Nov-10
    
    Feb-10Exercise Price (A$)
    
    
    1.37
    
    
    Nil

    
    
    1.58
    
    
    
    1.60Share Price at Grant Date (A$)
    
    
    1.37
    
    
    
    1.58
    
    
    
    1.58
    
    
    
    1.60Volatility
    
    
    70
    %
    
    
    72
    %
    
    
    72
    %
    
    
    77
    %Expected Life
    
    7 years
    
    
    7 years
    
    
    7 years
    
    
    7 yearsRisk Free Interest Rate
    
    
    5.36
    %
    
    
    5.27
    %
    
    
    5.27
    %
    
    
    5.34
    %Fair Value of Option (A$)
    
    
    0.83
    
    
    
    1.58
    
    
    
    0.96
    
    
    
    0.99
  16




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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 Weighted averageexercise priceNumber of shares

    
    A$Balance at December 31, 2010
    
    
    8,539,704
    
    
    
    0.93Granted
    
    
    367,000
    
    
    
    1.37Exercised
    
    
    (136,666
    )
    
    
    0.51Lapsed
    
    
    (104,335
    )
    
    
    1.46Balance at March 31, 2011
    
    
    8,665,703
    
    
    
    0.95
   Fiscal Year
    
    A$2011  remaining periods
    
    
    938,8792012
    
    
    506,9842013
    
    
    125,0802014
    
    
    9,1971,580,140
 Pension Costs
  Net Profit/(Loss) per Share and Anti-dilutive Securities
  Total Comprehensive Income
  Recent Accounting Pronouncements
  17




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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
     Related Party Transactions
    18




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Universal Biosensors, Inc.
 Notes to Consolidated Condensed Financial Statements (Unaudited)
 Three Months Ended March 31,2011
    
    
    2010A$
    
    
    A$Current ReceivablesSale of goods
    
    
    1,201,986
    
    
    
    800,071Sale of services
    
    
    90,962
    
    
    
    1,642,4171,292,948
    
    
    
    2,442,488RevenueRevenue from products
    
    
    3,319,401
    
    
    
    1,524,813Revenue from services
    
    
    245,920
    
    
    
    1,893,1333,565,321
    
    
    
    3,417,946
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Universal Biosensors, Inc.
 
 Item 2 Managements Discussion and Analysis of Financial Condition and Results of Operations
 The following discussion and analysis provides information that we believe is relevant to an
assessment and understanding of our results of operations and financial condition. You should read
this analysis in conjunction with our audited consolidated financial statements and related
footnotes and Managements Discussion and Analysis of Financial Condition and Results of Operations
included in our Form 10-K filed with the United States Securities and Exchange Commission (SEC).
This Form 10-Q contains, including this discussion and analysis, certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, which are intended to be covered by the safe harbors created by such acts.
For this purpose, any statements that are not statements of historical fact may be deemed to be
forward looking statements, including statements relating to future events and our future financial
performance. Those statements in this Form 10-Q containing the words believes, anticipates,
plans, expects, and similar expressions constitute forward looking statements, although not all
forward looking statements contain such identifying words.
 The forward looking statements contained in this Form 10-Q are based on our current
expectations, assumptions, estimates and projections about the Company and its businesses. All
such forward looking statements involve known and unknown risks, uncertainties and other factors
that may cause our actual results to be materially different from those results expressed or
implied by these forward-looking statements, including those set forth in this Quarterly Report on
Form 10-Q.
 Our Business
     Results of Operations
 Manufacture of Products
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##### Table of Contents



Universal Biosensors, Inc.
  Three Months Ended March 31,2011
    
    
    2010A$
    
    
    A$Revenue from products
    
    
    3,319,401
    
    
    
    1,524,813Cost of goods sold
    
    
    (3,492,052
    )
    
    
    (1,538,436
    )(172,651
    )
    
    
    (13,623
    )
  Services Performed
  
    
    Contract research and development  we undertake contract research and development in
the area of diabetes management for LifeScan;
    
    Product enhancement  a service fee based on the number of strips sold by LifeScan is
payable to us as an ongoing reward for our services and efforts to enhance the product;
    
    Other services  ad-hoc services provided on an agreed basis based on LifeScans
requirements.
  Three Months Ended March 31,2011
    
    
    2010A$
    
    
    A$Revenue from services
    
    
    245,920
    
    
    
    1,893,133Cost of services
    
    
    (63,519
    )
    
    
    (246,064
    )182,401
    
    
    
    1,647,069
  Research and Development Expenses
  21




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Universal Biosensors, Inc.
  
    
    consultant and employee related expenses, which include consulting fees, salary and
benefits;
    
    materials and consumables acquired for the research and development activities;
    
    external research and development expenses incurred under agreements with third party
organizations and universities; and
    
    facilities, depreciation and other allocated expenses, which include direct and allocated
expenses for rent and maintenance of facilities, depreciation of leasehold improvements and
equipment and laboratory and other supplies.
               22




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Universal Biosensors, Inc.
 Three Months Ended March 31,2011
    
    
    2010A$
    
    
    A$Research and development expenses
    
    
    1,747,507
    
    
    
    1,554,227
    General and Administrative Expenses
   Three Months Ended March 31,2011
    
    
    2010A$
    
    
    A$General and administrative expenses
    
    
    1,405,358
    
    
    
    1,469,609
  Interest Income
  Critical Accounting Estimates and Judgments
  23




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Universal Biosensors, Inc.
         Share Price at Valuation Date
  Volatility
  Time to Expiry
  Risk Free Rate
  24




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Universal Biosensors, Inc.
        Financial Condition, Liquidity and Capital Resources
 Net Financial Assets/(Liabilities)
  25




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Universal Biosensors, Inc.
 Three Months Ended
    
    
    Year EndedMarch 31, 2011
    
    
    December 31, 2010A$
    
    
    A$Financial assets:Cash and cash equivalents
    
    
    20,571,889
    
    
    
    23,271,766Accounts receivables
    
    
    1,485,448
    
    
    
    3,588,798Other
    
    
    793,840
    
    
    
    310,000Total financial assets
    
    
    22,851,177
    
    
    
    27,170,564Debt:Short and long term debt/borrowings
    
    
    
    
    
    
    Total debt
    
    
    
    
    
    
    Net financial assets
    
    
    22,851,177
    
    
    
    27,170,564
  Measures of Liquidity and Capital Resources
  Three Months Ended
    
    
    Year EndedMarch 31, 2011
    
    
    December 31, 2010A$
    
    
    A$Cash and cash equivalents
    
    
    20,571,889
    
    
    
    23,271,766Working capital
    
    
    24,197,121
    
    
    
    26,250,899Ratio of current assets to current liabilities
    
    
    10.45 : 1
    
    
    
    6.89 : 1Shareholders equity per common share
    
    
    0.28
    
    
    
    0.30
  Summary of Cash Flows
 Three Months Ended
    
    
    Year EndedMarch 31, 2011
    
    
    December 31, 2010A$
    
    
    A$Cash provided by/(used in):Operating activities
    
    
    (2,101,090
    )
    
    
    (6,414,248
    )Investing activities
    
    
    (664,913
    )
    
    
    (2,320,293
    )Financing activities
    
    
    66,126
    
    
    
    715,296Net increase/(decrease) in cash and cash equivalents
    
    
    (2,699,877
    )
    
    
    (8,019,245
    )
  26




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Universal Biosensors, Inc.
   Off-Balance Sheet Arrangement
  A$Less than 1 year
    
    
    542,1451  3 years
    
    
    1,131,9033  5 years
    
    
    More than 5 years
    
    
    Total minimum lease payments
    
    
    1,674,048
  Contractual Obligations
  Payments Due By PeriodTotal
    
    
    Less than 1
    
    
    1  3 years
    
    
    3  5 years
    
    
    More than 5A$
    
    
    A$
    
    
    A$
    
    
    A$
    
    
    A$Long-Term Debt Obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Asset Retirement Obligations (1)
    
    
    2,040,214
    
    
    
    
    
    
    
    2,040,214
    
    
    
    
    
    
    
    Operating Lease Obligations (2)
    
    
    1,674,048
    
    
    
    542,145
    
    
    
    1,131,903
    
    
    
    
    
    
    
    Purchase Obligations (3)
    
    
    4,769,325
    
    
    
    4,769,325
    
    
    
    
    
    
    
    
    
    
    
    Other
Long-Term Liabilities on Balance Sheet under GAAP (4)
    
    
    151,356
    
    
    
    
    
    
    
    81,739
    
    
    
    67,240
    
    
    
    2,377Total
    
    
    8,634,943
    
    
    
    5,311,470
    
    
    
    3,253,856
    
    
    
    67,240
    
    
    
    2,377
 
 (1)
    
    Represents legal obligations associated with the retirement and removal of
long-lived assets.(2)
    
    Our operating lease obligations relate primarily to the lease of our premises.(3)
    
    Represents outstanding purchase orders(4)
    
    Represents long service leave owing to the employees. Segments
  27




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Universal Biosensors, Inc.
 
 Item 3 Quantitative and Qualitative Disclosures About Market Risk
 Financial Risk Management
  Foreign Currency Market Risk
   Interest Rate Risk
  28




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Universal Biosensors, Inc.
 
 Item 4. Controls and Procedures
 Disclosure Controls and Procedures.
 Changes in Internal Control Over Financial Reporting.
 29




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Universal Biosensors, Inc.
 
 PART II
 
 Item 1 Legal Proceedings
  
 Item 1A Risk Factors
  
 Item 2 Unregistered Sales of Equity Securities and Use of Proceeds
  Number of Options Exercised
    
    Option
    
    Proceedsand Corresponding Number
    
    Exercise
    
    ReceivedExercise Date
    
    of Shares Issued
    
    Price
    
    (A$)January
    
    
    50,000
    
    
    
    A$0.89
    
    
    
    44,500January
    
    
    26,667
    
    
    Nil
    
    
    January
    
    
    13,333
    
    
    
    A$0.50
    
    
    
    6,667January
    
    
    6,666
    
    
    
    A$0.94
    
    
    
    6,266March
    
    
    40,000
    
    
    
    US$0.22
    
    
    
    8,693136,666
    
    
    
    
    
    
    
    66,126
  
 Item 3 Defaults Upon Senior Securities
  
 Item 4 [Removed and Reserved]
 
 Item 5 Other Information
  
 Item 6 Exhibits
 Exhibit No
    
    Description
    
    Location10.1
    
    Employment agreement between
Universal Biosensors Pty Ltd and Mr. Paul Wright executed February 21,
2011
    
    Incorporated by reference to our
current report on Form 8-K filed on February 25, 2011 as Exhibit 10.131.1
    
    Rule 13a-14(a)/15d-14(a) Certification (Principal Executive Officer)
    
    Filed herewith31.2
    
    Rule 13a-14(a)/15d-14(a) Certification (Principal Financial Officer)
    
    Filed herewith32.0*
    
    Section 1350 Certificate
    
    Filed herewith
 
 *
    
    This exhibit is furnished rather than filed, and shall not be incorporated by reference into
any filing of the registrant in accordance with Item 601 of Registration S-K 30




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Universal Biosensors, Inc.
 
 SIGNATURES
  UNIVERSAL BIOSENSORS, INC.
(Registrant)Date: May 5, 2011
    By:
    /s/ PAUL WRIGHTPaul WrightPrincipal Executive OfficerDate: May 5, 2011
    By:
    /s/ SALESH BALAKSalesh BalakPrincipal Financial Officer 31




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INDEX TO EXHIBITS
Quarterly Report on Form 10-Q
Dated May 5, 2011
 Exhibit No
    
    Description
    
    Location10.1
    
    Employment agreement between
Universal Biosensors Pty Ltd and Mr. Paul Wright executed February 21,
2011
    
    Incorporated by reference to our
current report on Form 8-K filed on February 25, 2011 as Exhibit 10.131.1
    
    Rule 13a-14(a)/15d-14(a) Certification (Principal Executive Officer)
    
    Filed herewith31.2
    
    Rule 13a-14(a)/15d-14(a) Certification (Principal Financial Officer)
    
    Filed herewith32.0
    
    Section 1350 Certificate
    
    Filed herewith
 32