Basis of preparation (Policies)

6 Months Ended

Dec. 31, 2024

Basis Of Preparation [Abstract]

Description of accounting policy for basis of preparation explanatory

Basis of preparation

Mesoblast Limited is a for-profit entity for the purpose of preparing the financial statements. The condensed consolidated financial statements of Mesoblast Limited and its subsidiaries have been prepared in accordance with International Accounting Standard IAS 34 Interim Financial Reporting, as issued by the International Accounting Standards Board (“IASB”), and are unaudited. These condensed interim financial statements do not include all of the notes and disclosures required by International Financial Reporting Standards, as issued by the IASB, for annual consolidated financial statements and should therefore be read in conjunction with our annual report on Form 20-F for the year ended June 30, 2024. In the opinion of management, the interim financial data includes all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the results for the interim periods.

The financial statements cover Mesoblast Limited and its subsidiaries. The financial statements were authorized for issue by the board of directors on February 27, 2025. The directors have the power to amend and reissue the financial statements.

(i)    Going concern

As of December 31, 2024, the Group held total cash reserves of $38.0 million. In January 2025, the Group announced completion of a global private placement primarily to existing major US, UK and Australian shareholders raising an additional $161.0 million after approval of Ryoncil® (remestemcel-L) for the treatment of SR-aGvHD in children 2 months and older. The Group continues its focus on maintaining tight control of net cash usage for operating activities, which were $20.7 million for the six months ended December 31, 2024, a reduction of 22% compared to the prior period.

The Group has cash reserves to execute the US commercial launch activities of RYONCIL, to commence life cycle extension of the FDA approved product in children and adults, and continue its clinical development pipeline. In conjunction with existing cash reserves, the proceeds from the January 2025 private placement and future revenue from sales of RYONCIL, the Group has sufficient cash to meet its forecast expenditure over at least the next twelve months.

(ii)    Historical cost convention

These financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets at fair value through other comprehensive income, financial assets and liabilities (including derivative instruments) at fair value through profit or loss, certain classes of property, plant and equipment and investment property.

(iii)    New and amended standards adopted by the Group

The amendment to IAS 1 "Presentation of Financial Statements" was effective for Mesoblast from July 1, 2024, to improve the information an entity provides in its financial statements about long‑term liabilities with covenants where the entity’s right to defer settlement of those liabilities for at least twelve months after the reporting period is subject to the entity’s complying with conditions specified in the loan arrangement. These amendments to the accounting policy have been adopted and there has been no material impact to the Group.

There were no other new or amended standards adopted by the Group in the six months ended December 31, 2024. These interim financial statements follow the same accounting policies as compared to the June 30, 2024 consolidated financial statements and related notes as filed with the Australian Securities Exchange and the Securities and Exchange Commission.

(iv)    New accounting standards and interpretations not yet adopted by the Group

In April 2024, IFRS 18, “Presentation and Disclosure in Financial Statements” was issued to achieve comparability of the financial performance of similar entities. The standard, which replaces IAS 1 “Presentation of Financial Statements”, impacts the presentation of primary financial statements and notes, including the statement of earnings where companies will be required to present separate categories of income and expense for operating, investing, and financing activities with prescribed subtotals for each new category. The standard will also require management-defined performance measures to be explained and included in a separate note within the consolidated financial statements. The standard is effective for annual reporting periods beginning on or after January 1, 2027, including interim financial statements, and requires retrospective application. The Group is currently assessing the impact of the new standard.

There were no new accounting standards and interpretations not yet adopted by the Group for the December 31, 2024 reporting period that are expected to materially impact the Group.

(v)    Use of estimates

The preparation of these condensed consolidated financial statements requires the Group to make estimates and judgments that affect the reported amounts of assets, liabilities, income and expenses and related disclosures. On an ongoing basis, the Group evaluates its significant accounting policies and estimates. Estimates are based on historical experience and on various market-specific and other relevant assumptions that the Group believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities.

(vi)    Impact of pandemics and geopolitical or economic instability and climate events

Estimates are assessed each period and updated to reflect current information, such as the economic considerations related to pandemics, geopolitical and/or economic instability or the impact climate events could have on the Group's significant accounting estimates. The Group does not expect these areas to have a material impact on the Group's significant accounting estimates.