2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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2025 Annual Report
5G NETWORKS LTD
AND ITS CONTROLLED ENTITIES
ABN 21 073 716 793
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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CONTENTS
Overview
Corporate Directory
3
Chair’s Statement
6
Managing Director’s Review
8
Directors’
Directors’ Report
11
Reports
Remuneration Report
22
Governance
Corporate Governance Statement
31
Auditors Independence Declaration
37
Financial
Financial Statements
39
Statements
Notes to the Financial Statements
45
Consolidated Entity
Disclosure Statement
Consolidated Entity Disclosure Statement
84
Signed
Directors’ Declaration
85
Reports
Independent Auditors’ Report
86
Shareholder and
ASX Information
Shareholder Information
90
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
CORPORATE DIRECTORY
DIRECTORS
Hugh Robertson Jnr (Chairperson)
Joseph Demase (Managing Director)
Natalie Mactier (Non-Executive Director)
Chris Scott (Non-Executive Director)
COMPANY SECRETARY
Adam Gallagher
REGISTERED OFFICE AND
PRINCIPAL PLACE OF BUSINESS
Level 7, 505 Little Collins Street
Melbourne VIC 3000
COMPANY NUMBER
ACN 073 716 793
COUNTRY OF INCORPORATION
Australia
ASX CODE
5GN
COMPANY DOMICILE AND LEGAL FORM
5G Networks Limited is the parent entity
and an Australian Company limited by shares
LEGAL ADVISORS
Cornwalls
Level 4, 380 Collins Street
Melbourne VIC 3000
SHARE REGISTER
Automic Group
Suite 5 Level 12
530 Collins Street
Melbourne VIC 3000
AUDITORS
Grant Thornton Audit Pty Ltd
Tower 5, 727 Collins Street
Melbourne VIC 3000
INTERNET ADDRESS
5gnetworks.au
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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“Our strength lies not in choosing
between services and infrastructure,
but in uniting them. Secure networks,
sovereign cloud, and cyber expertise
together create the foundation for
Australia’s digital future.”
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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CHAIR’S STATEMENT
STRATEGIC EVOLUTION AND FINANCIAL YEAR OVERVIEW
As Chair of the Board, I am pleased to provide an overview
of our Group’s achievements and progress for the financial
year ended 30 June 2025. FY25 was a pivotal year for
5G Networks — a year of transformation, disciplined
execution, and strategic expansion into cyber security. We
delivered positive EBITDA, strengthened our balance sheet,
and broadened our core infrastructure and services portfolio,
positioning the Group for sustainable long-term growth.
STRENGTHENING CORE OPERATIONS
Our strategy remains centred on high-value, resilient business
units where 5GN holds competitive advantage:
•
Advanced Telecommunications Services: We continue
to operate and expand our nationwide and international
fibre and data networks, serving both enterprise and
wholesale markets. These assets provide the backbone
for cloud, data centre, and managed services delivery.
•
Cloud and Data Centres: Our owned and operated
facilities across Melbourne, Sydney, Brisbane, and
Adelaide — with more than 1,200 racks — remain integral
to our offering. Re-pricing initiatives and expanded
capacity contributed to growth in FY25.
•
Managed IT and Cyber Security Services: The
acquisition of AUCyber has deepened our expertise in
sovereign cloud and cyber security. Together with our
existing managed IT services, we now serve more than
2,500 corporate clients and 100 wholesale partners, with
growing demand from government and critical industries.
STRATEGIC TRANSACTIONS: EXPANSION AND
PORTFOLIO FOCUS
This year we executed disciplined capital allocation and
portfolio moves.
AUCyber Acquisition
In February 2025, we acquired a controlling stake in AUCyber
(ASX: CYB), with total purchases of $19.3 million during the
year taking our ownership to 89.6% at 30 June 2025. This
investment has been immediately revenue accretive,
contributing $9.7 million revenue in just five months. It
positions 5GN as a key provider of sovereign cloud and
security services..
Capital Return
We returned $4.6 million to shareholders through our on-
market buyback while maintaining balance sheet strength.
The Board has also initiated a strategic review of AUCyber,
assessing how closer integration can unlock operational
synergies and long-term value. We view cyber security as a
significant growth vector, highly complementary to our
infrastructure and managed services.
FINANCIAL PERFORMANCE REVIEW
The Group’s financial performance highlights the
effectiveness of our refined focus:
•
Revenue Growth: Continuing operations grew 8% to
$53.0 million. Including AUCyber, consolidated revenue
rose 27% to $62.6 million.
•
Gross Profit: Increased 5.1% to $29.9 million,
representing a robust 47.8% margin, the calculation of
which is defined in Note 4.
•
Underlying EBITDA Turnaround: Delivered underlying
EBITDA of $3.2 million, a $5.7 million improvement year-
on-year.
•
Cash and Capital Position: Closed the year with $29.3
million cash, after funding the AUCyber acquisition
and buyback.
This performance reflects both organic growth across
Enterprise and Wholesale segments, and the contribution
of AUCyber.
OUTLOOK
Looking ahead to FY26, the Board and management remain
focused on:
•
Completing the integration and considering full ownership
of AUCyber.
•
Scaling enterprise and wholesale revenue through
expanded data centre and cloud capacity.
•
Leveraging cyber expertise to secure government and
critical industry contracts.
•
Maintaining capital discipline while investing in
infrastructure and customer reach.
Yours sincerely,
Hugh Robertson Jnr
Chair
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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5
6
“We don’t just operate
infrastructure—we safeguard trust.
By combining cyber resilience with
national networks and data centres,
we are building a platform for growth
that our customers, shareholders
and communities can rely on.”
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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MANAGING DIRECTOR’S REVIEW
5G NETWORKS AND STRATEGIC DEVELOPMENTS
As we reflect on the financial year ended 30 June 2025, it is
clear that 5G Networks has taken another decisive step
forward. FY25 was a year of disciplined execution, strong
financial performance, and a strategic expansion into cyber
security, reinforcing our position as a trusted provider of
critical telecommunications infrastructure, cloud services, and
managed IT.
PRINCIPAL ACTIVITIES
Our Group’s activities continue to be centred around the
delivery of essential infrastructure and services:
•
Telecommunications Services: Through 5GN, we
provide carrier-grade services to enterprise and wholesale
customers across Australia and internationally. Our
operations include fibre networks, private cloud solutions,
and managed IT services, supporting more than 2,500
enterprise clients and 100 wholesale partners.
•
Cloud and Data Centres: Our owned and operated
facilities in Melbourne, Sydney, Brisbane, and Adelaide,
with a combined capacity of more than 1,200 racks,
remain critical to client success. Re-pricing and capacity
expansion during FY25 supported sustained growth.
•
Managed IT and Cyber Security: With the acquisition
of a controlling stake in AUCyber, we have significantly
strengthened our sovereign cloud and cyber capabilities.
These services are increasingly critical for government and
industry clients, aligning closely with our managed
IT offerings.
STRATEGIC DEVELOPMENTS
Acquisitions:
AUCyber Acquisition: In February 2025, we acquired a
controlling stake in AUCyber (ASX: CYB), with total purchases
of $19.3 million during the year taking our ownership to 89.6%
at 30 June 2025. This investment has been immediately
revenue accretive, contributing $9.7 million revenue in just five
months. It positions 5GN as a key provider of sovereign cloud
and security services. A Board-led strategic review is now
assessing pathways to full ownership and deeper integration.
Capital Management:
•
Share Buyback: We returned $4.6 million to shareholders
via our on-market share buyback, underlining our
commitment to shareholder value.
•
Strong Balance Sheet: Despite this capital return and the
AUCyber investment, we closed FY25 with $29.3 million in
cash, providing flexibility for future growth.
FINANCIAL PERFORMANCE
Our FY25 results reflect the success of our refined focus and
disciplined execution:
•
Revenue: Revenue from continuing operations grew 8%
to $53.0 million. Including AUCyber, consolidated revenue
rose 27% to $62.6 million.
•
Gross Profit: Increased 5.1% to $29.9million, delivering a
solid 47.8% margin, the calculation of which is defined in
Note 4.
•
Underlying EBITDA: Delivered positive EBITDA of $3.2
million, a $5.7 million turnaround year-on-year.
•
Enterprise and Wholesale Growth: Enterprise revenue
rose 30.3% to $42.3 million, while wholesale grew 20.5%
to $20.3 million, driven by large-scale Asia-Pacific
contracts.
CONCLUSION
FY25 marks a turning point for 5G Networks. We delivered a
return to positive EBITDA, successfully expanded into
sovereign cloud and cyber security, and maintained a strong
capital position. These achievements would not have been
possible without the dedication of our Board, Executive Team,
and employees across Australia and abroad.
I would also like to thank our customers for their continued
trust in 5G Networks to deliver and safeguard the critical
infrastructure that underpins their success.
Together, we are building a stronger, more resilient company,
positioned to create sustainable value for shareholders while
enabling our clients to thrive in a digital-first economy.
Yours sincerely,
Joseph Demase
Managing Director
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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KEY MILESTONES & ACHIVEMENTS
Revenue excluding AUCyber contribution increased 8% to $53.0
million.
Total consolidated revenue including AUCyber contribution rose 27%
to $62.6 million.
Gross profit increased 5.1% to $29.9 million (47.8% gross margin).
Underlying EBITDA of $3.2 million, a turnaround of $5.7 million
year-on-year (AUCyber contributed a net loss of $500k for the period).
Cash position of $29.3 million as at 30 June 2025, after $19.3 million
acquisition of AUCyber and $4.6 million share buyback.
Acquired controlling stake (89.6%) in AUCyber (ASX:CYB), expanding
into sovereign cloud and cyber security.
Enterprise revenue up 30.3% to $42.3 million, supported by $9.6
million contribution from AUCyber.
Wholesale revenue up 20.5% to $20.3 million, driven by large
Asia-Pacific contracts.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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DIRECTOR’S REPORT
Your Directors submit their report for the year ended
30 June 2025.
Directors were in office for the entire period unless
otherwise stated.
DIRECTORS
Mr. J. Demase
Ms. N. Mactier
Mr. J. Ashton (resigned 2 May 2025)
Mr. H. Robertson Jr (appointed 28 November 2024)
Mr C. Scott (appointed 9 May 2025)
Mr J. Gangi (resigned 13 August 2024)
MANAGING DIRECTOR AND
CHIEF EXECUTIVE OFFICER
Mr. J. Demase
CHIEF FINANCIAL OFFICER
Mr. K. Donovan (appointed 25 August 2025)
Mr. G. Dymond (resigned 13 September 2024)
COMPANY SECRETARIES
Mr A. Gallagher (appointed 2 September 2025)
Mr. M. Wilton (resigned 2 September 2025)
Mr. G. Dymond (resigned 13 September 2024)
DETAILS OF DIRECTORS’ EXPERIENCE, EXPERTISE
AND DIRECTORSHIPS
Directors in office during the period are presented below:
HUGH ROBERTSON JNR
Non-Executive Director and Chair
(appointed 28 November 2024)
Member of the Audit & Risk Committee and Member of the
Nomination & Remuneration Committee
Experience and Expertise
Hugh Robertson Jnr is a Director, Corporate Advisory at
Morgans Financial Limited, where he works with clients across
various industries, including financial services, technology, and
FMCG. With expertise in equity capital markets, business
development, strategic planning, and corporate finance, he
has a robust track record in capital raising and advising on
financial management. Prior to Morgans, Hugh was a Director,
Corporate Finance at Bell Potter Securities, he was involved in
initial public offerings (IPOs), capital raisings, mergers,
acquisitions, and divestments for public entities. His
leadership in managing multiple high-profile capital raises for
both public and private companies at Morgans Financial
further highlights his proficiency in managing complex financial
transactions for publicly listed organisations.
Other Current Listed Company Directorships
Health and Plant Protein Group Limited (ASX: HPP)
AUCyber Limited (ASX: CYB)
Former Listed Company Directorships in Last Three Years
Nil
JOSEPH DEMASE
Managing Director & CEO since 2020
Member of the Audit & Risk Committee and Member of the
Nomination & Remuneration Committee
Experience and Expertise
Mr Demase comes from a background in building a host of
successful businesses, including the completion of two ASX
listings in the telecommunications sector. Further to this,
Joseph has acquired experience in the telecommunications
sector amongst both the Australian and UK divisions,
along with over 25 years of business experience, allowing
Joseph to skillfully identify market opportunities across the
board. Joseph displays an abundance of experience, having
succeeded in a broad range of executive positions.
Other Current Listed Company Directorships
AUCyber Limited (ASX: CYB)
Former Listed Company Directorships in Last Three Years
Nil
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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DIRECTOR’S REPORT
NATALIE MACTIER
Non-Executive Director since 2020 and
Chair from 14 August 2024 to 28 November 2024
Chair of the Audit & Risk Committee and Member of the
Nomination & Remuneration Committee
Experience and Expertise
Natalie has over 20 years’ experience in the tech industry
having held senior management and Executive roles at
Australian start-up and scale-up organisations. With a
background in Sales and Marketing, Natalie helped build
online brands SEEK and Kidspot before being approached by
Square Peg capital to create School Places, an online private
school marketplace. Since 2018 Natalie has been the CEO of
Vivi International, an Australian technology company that is
transforming the way that educators connect with and engage
students though innovative software solutions. Natalie
believes in the importance of creating diverse and inclusive
environments in tech, ensuring that future generations have
the skills and opportunities they need to thrive.
Other Current Listed Company Directorships
Nil
Former Listed Company Directorships in Last Three Years
Nil
CHRIS SCOTT
Non-Executive Director (appointed 9 May 2025)
Experience and Expertise
Chris Scott is a seasoned leader with over 25 years’
experience in elite performance, strategic leadership, and
cultural transformation. As the current Head Coach of the
Geelong Football Club since 2011, Chris has driven one of the
most successful eras in modern AFL history, underpinned by a
disciplined, values-driven approach to leadership and team
development. His earlier career included a successful playing
tenure with the Brisbane Lions during their premiership era
(1994–2007), followed by an assistant coaching role at the
Fremantle Football Club. Chris is widely regarded for his
expertise in people management, leadership development,
and building high performing teams in complex, competitive
environments. His corporate and academic credentials include
executive education programs at Harvard University (3),
Stanford University, New York University (2), Columbia
University, and The Wharton School at the University of
Pennsylvania, where he completed the Maximising Your
Effectiveness in the Boardroom governance program.
Other Current Listed Company Directorships
Nil
Former Listed Company Directorships in Last Three Years
Nil
JOE GANGI
Non-Executive Director and Chair
(resigned 13 August 2024)
Member of the Audit & Risk Committee and Member of the
Nomination & Remuneration Committee
Experience and Expertise
Mr Gangi has over 30 years’ experience in corporate
management and governance and was an independent
director of the Company since October 2020. He is a member
of the RMIT University, Engineering Faculty, Industry Advisory
Committee and is an active advisor to several private sector
boards. He also provides consulting services to the Local
Government sector. His expertise lies in business
management and leadership with a focus on business
sustainability, growth and development, strategic and client
relationship management and risk management. Joe’s
business management skills are underpinned by the
management of several business units across the Asia Pacific
region in the professional engineering services sector while his
technical experience is demonstrated by the successful
delivery of several industrial manufacturing projects.
Other Current Listed Company Directorships
Nil
Former Listed Company Directorships in Last Three Years
Nil
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DIRECTOR’S REPORT
JASON ASHTON
Non-Executive Director (resigned 2 May 2025)
Chair of the Nomination & Remuneration Committee and
Former Member of the Audit & Risk Committee
Experience and Expertise
Mr Ashton has deep knowledge and experience in the IT and
Telecommunications industries. Jason was co-founder (1993)
and Managing Director of leading ISP Magna Data which was
acquired in 1999. Jason was also co-founder (2002) of ASX
listed BigAir Group Limited and was its Chief Executive Officer
from 2006 until its acquisition by Superloop Limited in 2016
(ASX: SLC). Jason Ashton served as an Executive Director at
Superloop from 2016 to 2018 prior to joining the Board of
5G Networks Limited in 2019.
Other Current Listed Company Directorships
Nil
Former Listed Company Directorships in Last Three Years
Nil
COMPANY SECRETARIES
MR ADAM GALLAGHER
Company Secretary since 2 September 2025
Adam is a highly experienced company secretary, director and
executive with a broad corporate skill-set and provides
governance services to listed companies through his firm
Applied Corporate Governance Partners. Adam holds a
Bachelor of Economics, Master in Commerce, Graduate
Diploma in Information Systems and Graduate Diploma in
Applied Corporate Governance and is a Fellow of the
Governance Institute of Australia.
MR MICHAEL WILTON
Company Secretary since 2020
(resigned 2 September 2025)
Mr Wilton has a wealth of domestic and international
experience, spanning across mergers and acquisitions and
equity capital market strategies, most recently as a partner at
Cornwalls and Norton Rose Fulbright prior to that. His
expertise includes public company takeovers, private treaty
sales and acquisitions, joint ventures and corporate
reconstructions. His ECM experience includes a number of
IPOs and many secondary capital raisings for ASX listed
companies. In the IT and Telecommunications sector, Michael
has worked with the Commonwealth Government on a number
of major transactions including the Telstra privatisation and the
State of Victoria where he was engaged in a number of large
government IT and Telecommunications projects.
MR GLEN DYMOND
Company Secretary since 2020
(resigned 13 September 2024)
Mr Dymond has more than 25 years’ experience in senior
finance and operations management roles at several ASX-
listed entities, including Zenitas Healthcare Limited, Spotless
Group Limited, Broadspectrum Limited and ConnectEast
Group. Mr Dymond’s commercial finance and operations
experience has been achieved across a diverse range of
business programs. This includes process development to
drive financial performance, as well as client commercial
management and driving successful change management
across organisations undergoing rapid growth and change.
PRINCIPAL ACTIVITIES
The Group’s principal activities during the period were:
•
the supply of cloud-based solutions, managed services;
cyber services and network services
•
the operation of fibre and wireless infrastructure and
management of cloud computing environment
•
the operation of data centre facilities.
There have been no other significant changes in the nature of
the Group’s activities.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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DIRECTOR’S REPORT
REVIEW OF OPERATIONS AND RESULTS –
CONTINUING OPERATIONS
Year ended
30-Jun-25
$’000
30-Jun-24
$’000
CONTINUING OPERATIONS
Total revenue from contracts
with customers
62,634
49,336
Underlying EBITDA1 from
Continuing Operations
3,242
(2,532)
Loss after tax from continuing
operations
(10,136)
(28,008)
Profit after tax from discontinued
operations
-
77,424
Profit/(Loss) after tax attributable
to members of the parent
(9,744)
49,416
1. Refer section below – Management performance measures –
underlying EBITDA
A review of the continuing operations of the Group during the
period and the results of those operations found that revenue
from continuing operations was $53.0 million, representing 8%
growth on the prior period. Including AUCyber’s contribution,
total consolidated revenue was $62.6 million. Growth was
driven by Cloud, Networks & Data Centres, and Managed
Services, supported by contract re-pricing, organic sales
execution, and the initial contribution from AUCyber.
Enterprise revenue rose 30.3% to $42.3 million, and
Wholesale revenue increased 20.5% to $20.3 million,
underpinned by Asia-Pacific wins. Gross profit increased 5.1%
to $29.9 million (47.8% margin) the calculation of which is
defined in Note 4.
The Group delivered an Underlying EBITDA of $3.2 million, a
$5.7 million turnaround year-on-year, reflecting improved
operating leverage, mix, and cost discipline. The Group closed
the year with cash of $29.3 million after funding the AUCyber
acquisition and executing the on-market buyback.
The Board has commenced a strategic review of the Group’s
investment in AUCyber to assess deeper integration and
potential full ownership, given the structural growth in
sovereign cloud and cyber security and the strong adjacency
to Managed IT services.
KEY STRATEGIC AND FINANCIAL HIGHLIGHTS – YEAR
ENDED 30 JUNE 2025
•
Return to positive Underlying EBITDA of $3.2 million
(YoY turnaround of $5.7 million).
•
Revenue growth: $53.0 million from continuing operations
(+8%); $62.6 million consolidated including AUCyber.
•
Gross profit: $29.9 million (47.8% margin).
•
AUCyber acquisition: 89.6% controlling stake acquired for
$19.3 million; $9.7 million revenue contribution in five
months; expansion into sovereign cloud and cyber.
•
Segment momentum: Enterprise +30.3% to $42.3m;
Wholesale +20.5% to $20.3m, supported by Asia-Pac
contracts and DC re-pricing.
•
Capital management: $4.6 million returned via on-market
buyback; year-end cash $29.3 million.
•
Strategic review: Board-led process on AUCyber
integration and potential full acquisition underway.
Note: FY24 divestments (Domains Business; WME) and
associated MSA/TSA arrangements were completed in the
prior period and are not repeated here, other than where
relevant to ongoing service delivery.
MANAGEMENT PERFORMANCE MEASURES –
UNDERLYING EBITDA
The Group makes use of a management performance
measure, “Underlying EBITDA” (Earnings before Interest, Tax,
Depreciation and Amortisation). Underlying EBITDA aids users
in assessing the Group’s underlying business performance
after adjusting for non-recurring and unusual items affecting
period-to-period comparability. It is the primary internal
financial performance indicator used for business decisions
and remuneration outcomes.
Underlying EBITDA is a non-IFRS, unaudited measure and
may not be comparable to similarly titled measures used by
other entities. For FY25, the Group recorded Underlying
EBITDA of $3.2 million (FY24: loss, improved by $5.7 million).
A detailed reconciliation to statutory IFRS measures (profit
before tax) will be provided in the financial statements notes.
Year ended
30-Jun-25
$’000
30-Jun-24
$’000
CONTINUING OPERATIONS
(Loss) / profit before tax
(19,893)
(30,093)
Depreciation and amortisation
expense
7,125
7,650
Share based expenses
1,829
1,885
Finance costs (excl. bank charges
and merchant fees)
1,169
2,643
Non-recurring costs
2,479
8,315
Impairments of financial assets,
goodwill, fixed assets and
intangible assets
7,125
6,911
Loss on sale of businesses and
investments
-
157
Net (Gain) / Loss on FV of
Financial Instruments
(435)
Loss on remeasurement of
Assets held for sale
3,339
Underlying EBITDA
3,242
(2,532)
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
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DIRECTORS’ REPORT
ACQUISITIONS AND INVESTING ACTIVITIES
AUCyber (ASX: CYB): In January 2025, the Group acquired
89.6% of AUCyber for $19.3 million, extending capabilities
into sovereign cloud and cyber security. The acquisition was
immediately revenue accretive, adding $9.7 million revenue in
five months and enhancing the Group’s positioning with
Government and critical national industries. Integration is
underway in parallel with the Board’s strategic review.
Infrastructure investment: The Group continued to invest in
data centre and cloud capacity to support Enterprise and
Wholesale growth and to underpin cyber-adjacent managed
services.
CAPITAL STRUCTURE
On-market share buyback: The Group returned $4.6 million
to shareholders during FY25. Year-end cash was $29.3
million, providing balance sheet strength to pursue
disciplined growth and integration initiatives.
Debt: The Group maintained a conservative funding position
through FY25, consistent with the objective of preserving
flexibility for infrastructure scaling and strategic options. (See
notes to the accounts for facility details)
MATERIAL BUSINESS RISKS
The material business risks that have the potential to impact
on the future prospects of the Group include:
Competition
The digital services industry is rapidly evolving with a
heightened environment of change characterised by
disruptive technologies. The Group therefore faces potential
loss of its competitive or market position as a result of
potential product innovation by existing competitors or new
entrants to the market. The Group may not anticipate or
respond to any such developments with sufficient speed to
maintain its market position. Other competitive risks faced by
the Group include price competition, competitor marketing
campaigns, mergers of, or acquisitions by, competitors and
possible new entrants to the market.
Changes in Technology
The digital services industry is evolving rapidly with the
frequent introduction of new technologies, products and
innovations. Consumer behaviours, preferences and trends
are also constantly changing upon the onset of new methods
of communication and digital platforms. The Group must
likewise evolve and adapt its products and service offering to
maintain pace with the industry in which it operates and to
maintain its competitive position. Given the pace of change,
there is no guarantee that the Group will be able to continue
to introduce new and superior products, or products that are
perceived to be new and superior by consumers, at the rate
seen by other competitors in the market generally.
The Group’s ability to do so is constrained by factors
including its available capacity, resources and capital to
invest in product development, innovation and design. This
may adversely impact on the Group’s long- and short- term
business performance.
The Group’s businesses are heavily dependent on
information communication technology for the delivery of
their various services, across large geographic distance, and
it has invested significantly in technology to maximise the
efficiency of its operations. Should these systems not be
adequately maintained, secured and updated, or the Group’s
disaster recovery processes not be adequate, system failures
may negatively impact the Group’s performance.
The Group has undertaken IT transformation programs in
recent years which are still in progress and may cause
unexpected disruptions, fail to provide anticipated benefits or
otherwise be unsuccessful. A significant implementation and
migration failure could result in a major impact on the
Group’s customer retention, revenues, costs and reputation.
Infrastructure and Technology Failure
The Group relies on its technical infrastructure and networks
to provide its customers with a highly reliable service.
There may be a failure to deliver this level of service as a
result of numerous factors, including human error, power
loss, failure of third-party equipment, services or networks,
improper maintenance by landlords and security breaches.
Service interruptions, regardless of their cause, may cause
contractual and other losses to the Group.
Cyber and Security Risks
Protection of customer and third-party data is critical to the
Group’s ongoing business and any breaches of this could
have significant negative financial ramifications. The Group
retains a significant amount of sensitive customer and third-
party information. Customers and third parties have high
expectations regarding the protection of their information.
Additionally, the legal and regulatory environment
surrounding information security and privacy is increasingly
complex and demanding. Failures or breaches of data
protection systems can result in reputational damage,
regulatory impositions (such as for breaches of the Privacy
Act 1988 (Cth)) and financial loss, including claims for
compensation by customers or penalties by
telecommunications regulators or other authorities.
As a technology business, the Group’s business may be
particularly adversely affected by technological disruptions,
including through impacts of malicious third-party
applications or other form of cyber-attack on the Group that
could result in failures and interfere with its systems,
products and platforms. It is possible that the measures
taken by the Group will not prevent unauthorised access to
its systems and technologies, risking third party access to
confidential or otherwise sensitive data.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
17
DIRECTORS’ REPORT
This could lead to loss of key business or customer
information, reputational damage and claims from customers
or other third parties whose data may be affected.
If, as a consequence, the Group is unable to provide services
to its customers, it may experience loss of market share,
damage to reputation and brand, customer compensation
claims and regulatory action. This may result in the Group
incurring significantly increased expenses or suffering
reduced revenue.
Compliance Risks
The Group relies on certain accreditations and licences to
operate their businesses. In particular, the Group holds a
carrier licence under the Telecommunications Act 1997 which
is essential to operate as a carrier of telecommunications
infrastructure. If this licence or other licences were to be
cancelled it could severely restrict the ability of the Group to
operate and could result in the Group breaching a number of
its contractual obligations.
The Group’s businesses are reliant on wholesale licences to
provide digital services to customers and cannot be assured
that it will continue to be provided with these brand licences. If
the Group were to not have such brand licences, its ability to
attract customers or provide attractive offerings could be
negatively affected, which in turn could have a material
adverse effect on its business, financial condition and results
or operations of the Group.
The Group operates in a highly regulated environment with
several accreditation and licensing compliance obligations.
These compliance obligations have strong penalties for non-
compliance, including undertakings or the imposition of
substantial civil and criminal penalties. Possible changes to
existing regulation may impose substantial risks to the
Group’s businesses and increased compliance costs.
The Group is also exposed to risks from unexpected
regulatory policies, outcomes or decisions by regulators
empowered to regulate the telecommunications sector,
including the Australian Competition & Consumer Commission
and the Australian Communications and Media Authority
which may result in an increase in compliance costs and
delays in having to seek additional, or variations to,
government approvals, adverse impacts upon the Group’s
ability to continue to acquire goods and services from existing
suppliers from foreign countries, or fines and penalties being
imposed for contraventions of relevant laws.
Availability of Equipment
The Group is dependent upon third party suppliers for IT and
network infrastructure and, in some cases, licences, services,
equipment and content from parties over whom the Group
may have no direct operational or financial control. If any of
these third party providers fail to maintain their products,
solutions, services or offerings properly or fails to respond
and adapt quickly to any of the Group’s requirements,
customers may experience service interruptions.
The dependence on these third party suppliers for support and
delivery of certain core business functions means that the
impact of regulatory changes or issues with the Group’s
supply chain could have a significant adverse impact on
the timeliness or cost of building or maintaining the
Group’s network.
There is also a risk that third party suppliers may provide
services or products with defects, which may lead to network
underperformance or other impacts on customers. This could,
in turn, adversely affect the Group’s market share or revenue.
Equity and Debt Market Risks
The Company’s balance sheet remains well capitalised with
$29.3m of cash. In the event that the Company required debt
to fund ongoing operations, the Group’s ability to service its
existing debt depends upon its financial performance and
cash flows which to some extent are subject to general
economic, financial, regulatory and other factors beyond the
control of the Group. If the Group is unable to generate
sufficient cash flow to meet specific debt repayment
obligations, it may face additional financial penalties,
higher interest rates or difficulty obtaining further funding in
the future.
The Group may in the future require additional debt or equity
capital in order to fund growth strategies, in particular for
acquisition opportunities that may arise from time to time.
There is a risk that the Group may be unable to access debt or
equity funding from the capital markets on favourable terms,
or at all.
Financial and Economic Conditions
The financial performance of the Group and the value of its
shares may fluctuate due to various factors, including
movements in the Australian and international capital markets,
recommendations by brokers and analysts, interest rates,
exchange rates, inflation, Australian and international
economic conditions, change in international economic
conditions, change in government, fiscal, monetary and
regulatory policies, prices of commodities, global geo-political
events and hostilities, global health pandemics and acts of
terrorism, investor perceptions and other factors that may
affect the Group’s financial position and earnings. In the
future, these factors may affect the Group and may cause the
price of its shares to fluctuate and trade below current prices.
In light of recent global macroeconomic events, including the
impact of the recent COVID-19 pandemic, Australia may
experience an economic recession or downturn of uncertain
severity and duration which could impact the Group’s ability to
attract and retain customers, to invest sufficiently to develop,
adopt and integrate the latest technologies into
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
18
DIRECTORS’ REPORT
existing infrastructure, and to secure and maintain third party
suppliers for IT and network infrastructure over whom the
Group may have no direct operational or financial control.
These economic disruptions may adversely impact the
Group’s earnings and assets, as well as the value of
its shares.
Employee Relations and Personnel Risks
The Group’s ongoing success depends in part upon its
ability to retaining its key employees. If there is a departure
of key employees, the Group’s business could be
adversely affected.
The Group may have to incur significant costs in identifying,
hiring and retaining replacements for departing employees
and may lose significant expertise and talent relating to the
business. Certain key executives and other employees of the
Group may terminate their management positions or their
employment contracts on their own initiative. If members of
the Group’s senior management depart, the Group may not
be able to find effective replacements in a timely manner, or at
all, and its business may be disrupted
DIVIDENDS
No Dividends were paid during the period.
SIGNIFICANT EVENTS AFTER REPORTING DATE
Following the release of AuCyber Limited’s (ASX:CYB)
Annual Report on 26 August 2025, 5GN has made additional
on-market purchases utilising section 611 of the Corporations
Act 2001 (Cth) (“Corporations Act”) (“3% creep rule”).
Under the 3% creep rule, in the six months commencing
29 August 2025, 5GN may purchase up to 92.86% of
CYB’s issued shares.
5GN has six months from 3 September 2025 in which it may
exercise its general compulsory acquisition power pursuant to
section 664A of the Corporations Act to acquire the remainder
of CYB’s issued ordinary shares. The Board of 5GN has not
yet determined if it will exercise this power.
Other than the above, there has not been any matter or
circumstance in the interval between the end of the year and the
date of this report that has materially affected or may materially
affect the operations of the Group, the results of those
operations or the state of affairs of the Group in subsequent
financial periods.
LIKELY DEVELOPMENTS, BUSINESS STRATEGIES
AND PROSPECTS
The Group’s strategy for FY25 and future years is to achieve
revenue and EBITDA growth across each of its customer
segments to deliver growth in returns to its shareholders. The
Group’s believes that the continued growth in demand for
digital, cloud and network services will support the growth in
demand for the Group’s products and services.
The Board also expects to focus on EBITDA-accretive
acquisition of businesses that complement the Group’s
existing products and services.
Further information on the Group’s future prospects are
contained in the Chairman’s and Managing Director’s Reports
on pages 6 and 8 respectively.
INSURANCE OF OFFICERS
During the period, 5G Networks Limited agreed to pay a
premium to insure the Directors and secretaries of the Group
and its Australian-based controlled entities.
The liabilities insured are legal costs that may be incurred in
defending civil or criminal proceedings that may be brought
against the officers in their capacity as officers of the Group,
and any other payments arising from liabilities incurred by the
officers in connection with such proceedings, other than
where such liabilities arise out of conduct involving a wilful
breach of duty by the officers or the improper use by the
officers of their position or of information to gain advantage
for themselves or someone else to cause detriment to
the Group.
Details of the amount of the premium paid in respect of
insurance policies are not disclosed as such disclosure is
prohibited under the terms of the contract.
The Group has not otherwise, during or since the end of the
financial year, except to the extent permitted by law,
indemnified or agreed to indemnify any current or former
officer of the Group against a liability incurred as such by
an officer.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
19
DIRECTORS’ REPORT
MEETINGS OF DIRECTORS
The number of meetings of the Company’s Board of Directors and of each Board committee held during the year ended 30 June
2025, and the numbers attended by each Director were:
Full meetings of Directors
Meetings of Committees
Audit & Risk
Nomination & Remuneration
Number of meetings held
19
3
3
Name of Director
Eligible
Attended
Eligible
Attended
Eligible
Attended
Hugh Robertson Jnr
10
10
2
2
1
1
Joseph Demase
19
19
3
3
3
3
Natalie Mactier
19
17
3
3
3
3
Chris Scott
3
3
1
1
0
0
Jason Ashton
15
14
2
2
3
3
Joseph Gangi
2
2
0
0
1
1
INDEMNITY AND INSURANCE OF AUDITOR
The Group has not, during or since the end of the financial
year, indemnified or agreed to indemnify the auditor of the
Group or any related entity against a liability incurred by
the auditor.
During the financial year, the Group has not paid a premium in
respect of a contract to insure the auditor of the Group or any
related entity.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the court under section 237 of the
Corporations Act 2001 for leave to bring proceedings on
behalf of the company, or to intervene in any proceedings to
which the company is a party, for the purpose of taking
responsibility on behalf of the company for all or part of those
proceedings. No proceedings have been brought or
intervened in on behalf of the company with leave of the Court
under section 237 of the Corporations Act 2001.
NON-AUDIT SERVICES
The Group may decide to employ the auditor on assignments
additional to their statutory audit duties where the auditor’s
expertise and experience with the Group are important.
Details of the amounts paid or payable to the auditor for audit
and non-audit services provided during the period are set out
below in relation to the Group’s current auditor, Grant
Thornton Audit Pty Ltd.
The Board of Directors has considered the position and, in
accordance with advice received from the audit committee, is
satisfied that the provision of the non-audit services is
compatible with the general standard of independence
for auditors imposed by the Corporations Act 2001. The
Directors are satisfied that the provision of non-audit services
by the auditor, as set out below, did not compromise the
auditor independence requirements of the Corporations Act
2001 for the following reasons:
•
All non-audit services have been reviewed by the audit
committee to ensure they do not impact the impartiality
and objectivity of the auditor; and
•
None of the services undermines the general principles
relating to auditor independence as set out in APES 110
Code of Ethics for Professional Accountants.
During the year the following fees were paid or payable for
non-audit services provided by the auditor of the parent
entity, its related practices and non-related audit firms:
Consolidated
2025
$
2024
$
Other Assurance Services
Due Diligence Services
35,504
48,107
Total Remuneration for
Other Assurance Services
35,504
48,107
Taxation Services
Tax Compliance Services
-
181,958
Total Remuneration for
Taxation Services
-
181,958
Total Remuneration for Non-
Audit Services
35,504
230,065
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration as required
under section 307C of the Corporations Act 2001 is set out on
page 37.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
20
DIRECTORS’ REPORT
ROUNDING
The Group is a type of Company referred to in ASIC Corporations
(Rounding in Financial / Directors’ Reports) Instrument 2016/191 and
therefore the amounts contained in this report and in the financial
report have been rounded to the nearest $1,000, or in certain cases, to
the nearest dollar.
CORPORATE GOVERNANCE
The Company’s Corporate Governance Statement is
available on the Company’s website www.5gnetworks.au.
Signed in accordance with a resolution of the Board
of Directors:
Hugh Robertson Jnr
Chair
25 September 2025
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
21
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
22
REMUNERATION REPORT
The Directors present the 5G Networks Limited 2025
remuneration report, outlining key aspects of our
remuneration policy and framework as well as remuneration
awarded this year. It has also been audited as required by
section 308(3C) of the Corporations Act 2001.
The Report is structured as follows:
(A)
Key management personnel (KMP) covered in this
report
(B)
Remuneration policy and link to performance
(C)
Elements of remuneration
(D)
Remuneration expenses for executive KMP
(E)
Non-executive Director arrangements
(F)
Other statutory information
(A)
KEY MANAGEMENT PERSONNEL (KMP)
COVERED IN THIS REPORT
Directors:
•
Hugh Robertson Jnr – Non-Executive Chair
(appointed 28 November 2024)
•
Joseph Demase – Managing Director
•
Natalie Mactier – Non-Executive Director
(Chair from 14 August 2024 to 28 November 2024)
•
Chris Scott – Non-Executive Director
(appointed 9 May 2025)
•
Jason Ashton – Non-Executive Director
(resigned 2 May 2025)
•
Joseph Gangi – Non-Executive Director
(Chair until resignation on 13 August 2024)
Other Key Management Personnel:
•
Chris Wright – Chief Operating Officer
(appointed 1 March 2025)
•
Glen Dymond – Chief Financial Officer and
Company Secretary
(resigned 13 September 2024)
Mr Kieran Donovan was appointed Chief Financial Officer on
25 August 2025.
There have been no other changes in KMP since the end of
the reporting period.
(B)
REMUNERATION POLICY AND LINK TO
PERFORMANCE
Our remuneration committee is currently made up of all
directors. The Committee makes recommendations to the
Board with respect to appropriate remuneration and
incentive policies for executive Directors and senior
executives that:
a.
Motivate Executive Directors and senior executives to
pursue long term growth and success of the Group
within an appropriate control framework;
b.
Demonstrate a clear correlation between key
performance and remuneration; and
c.
Align the interests of key leadership with the long-term
interests of the Group’s shareholders.
Executive KMP Remuneration Policy Statement
Consistent with contemporary Corporate Governance
standards the Group’s remuneration policy aims to set
employee and executive remuneration that is fair,
competitive and appropriate for the markets in which it
operates. Specific objectives of the policy include
the following:
a.
Ensuring executive remuneration packages
involve a balance between fixed and incentive pay,
reflecting short and long term performance
objectives appropriate to the Group’s circumstances
and objectives;
b.
A proportion of executives’ remuneration is structured
in a manner designed to link reward to corporate and
individual performances; and
c.
Ensure that incentive plans are designed around
appropriate and realistic performance targets that
measure relative performance and provide rewards
when they are achieved.
Group Performance and Link to Remuneration
In considering the Group’s performance and benefit of
shareholder’s wealth, the Nomination and Remuneration
Committee had regard to the following measures in respect
of the current financial year and the previous four
financial years.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
23
REMUNERATION REPORT
Measure
2025
$’000
2024
$’000
2023
$’000
2022
$’000
20211
$’000
Underlying EBITDA from continuing operations2
3,237
(2,532)
(9,630)
17,561
11,928
Net profit/(loss) after tax
(10,136)
49,416
(19,109)
(24,738)
(61,922)
2025
Cents
2024
Cents
2023
Cents
2022
Cents
20211
Cents
Dividend per share
-
2.0
-
0.5
-
Change in share price
(1.0)
2.5
(8.5)
(26.5)
9.50
Share price close
14.0
15.0
12.5
21.0
47.5
1.
The financial year end date for the Group was changed from 31 December to 30 June after the financial year ended 31 December 2019. The measures for
2021 represent the 18-month period ended 30 June 2021
2.
Underlying EBITDA from continuing operations is a management performance measure (Earnings before Interest, Tax, Depreciation and Amortisation) that
the Group believes is useful for users of financial reports when assessing the Group’s underlying business performance and profit generation after
adjusting for non-recurring and unusual items affecting comparability between financial periods. Underlying EBITDA is also the primary financial
performance indicator used by the Group and is the basis for driving internal business decision-making as well as setting remuneration and reward
outcomes.
(C) ELEMENTS OF REMUNERATION
Fixed Annual Remuneration
Executives may receive their fixed remuneration as cash, superannuation and fringe benefits.
Short-term Incentives (“STI”) – Operational Bonuses
The short-term performance objectives implemented for the following KMP in relation to FY25 were as follows:
KMP
STI targets for the year
STI achieved and forfeited for the year
Chris Wright
• Bi-annual performance-based bonus of up to
$175,000 every 6 months.
• Revenue retention bonus (50%)
• Revenue growth bonus (50%)
•
Achieved: 100% / $175,000
•
Forfeited: 0% / $0
•
Assessed by reference to the actual
revenue performance for the half year
ended 31 December 2024.
Glen Dymond
• Bonus in relation to the proposed sale of the
5GN business.
• This target reflects the importance of this work to
the Group.
•
Achieved: 100% / $50,000
•
Forfeited: 0% / $0
•
Assessed by reference to the actual work
undertaken.
Bonuses were paid in respect of FY25 on 14 October 2024 and 14 April 2025.
No other short-term incentives were paid to KMP during the year.
Long-term Incentives
The 5G Networks Limited Executive and Director Share Option Plan (ESOP) was adopted in December 2020 for directors and
executives of the Group. The 5G Networks Limited Executive Equity Plan (EEP) was adopted in April 2022 for executives and
senior leaders of the Group.
During the year ended 30 June 2025 the Group issued 4,000,000 share options to KMP under the ESOP as a means of
rewarding and incentivising executives. Further details of the performance rights and share options, including details of rights
issued during the financial year, are set out in section D below.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
24
REMUNERATION REPORT
(D) REMUNERATION EXPENSES FOR EXECUTIVE KMP
The following table shows details of the remuneration expense recognised for the Group’s executive key management personnel for
the current and previous financial year measured in accordance with the requirements of the accounting standards. Remuneration
paid to Directors and executives is valued at the cost to the Group.
Short Term Benefits
Post
Employment
Benefits
Share Based
Payments
Other
Name
Year
Cash Salary
& Fees
Cash STI1
Annual
Leave &
Long
Service
Leave
Other2
Superannuation
Options &
Performance
Rights3
Termination
Pay
Total
Performance
Related4
$
$
$
$
$
$
$
$
%
Managing Director
Joseph Demase
2025
324,423
-
25,577
2,043
29,932
1,562,193
-
1,944,168
80%
2024
210,449
-
22,885
6,200
22,891
1,014,469
-
1,276,894
79%
Other Management Personnel
Chris Wright
2025
116,667
175,000
-
1,353
6,453
78,479
-
377,952
67%
2024
-
-
-
-
-
-
-
-
N/A
Glen Dymond5
2025
65,428
50,000
2,647
4,354
6,577
17,937
-
154,270
44%
2024
209,484
140,000
21,085
7,314
27,335
28,951
-
434,169
39%
Jonathan Horne6
2025
-
-
-
-
-
-
-
-
-
2024
156,731
-
16,346
3,100
19,013
245,505
-
440,695
56%
Garry White7
2025
-
-
-
-
-
-
-
-
-
2024
103,463
-
11,461
3,183
12,642
50,956
33,258
214,963
24%
John Stevens8
2025
-
-
-
-
-
-
-
-
-
2024
175,000
-
1,154
3,900
17,977
4,024
17,394
219,449
2%
Total KMP excluding
Non-Executive Directors
2025
506,518
225,000
28,224
7,750
42,962
1,658,609
7,327
2,476,390
76%
2024
855,127
140,000
72,931
23,697
99,858
1,343,905
50,652
2,586,170
57%
Total Non-Executive
Directors (Section E)
2025
210,666
-
-
-
7,841
(32,430)
-
186,077
0%
2024
431,818
-
-
-
9,000
602,328
-
1,043,146
58%
Total KMP
2025
717,184
225,000
28,224
7,750
50,803
1,626,179
7,327
2,662,427
70%
2024
1,286,945
140,000
72,931
23,697
108,858
1,946,233
50,652
3,629,316
57%
1.
Represents STIs paid in relation to the 2025 financial period.
2.
Represents the cost to the business of any non-cash business benefits provided.
3.
Represents the expense recorded during the period in relation to the fair value of Performance Rights and Options.
4.
Calculated as STI plus Performance Rights and Options expense, as a proportion of total remuneration. These two elements represent the at-risk and
discretionary amount payable which will vary depending on the financial performance of the Company and achievement of individual KPIs. They are in
addition to the fixed remuneration.
5.
Mr Glen Dymond resigned on 13 September 2024.
6.
Mr Jonathan Horne resigned on 20 December 2023.
7.
Mr Garry White resigned on 30 November 2023.
8.
Mr John Stevens resigned on 29 February 2024.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
25
REMUNERATION REPORT
OPTIONS AND RIGHTS HELD
Name
Balance at 1
July 2024 or
date of
appointment
Grant Details
Vested
Vested and
Exercisable
Exercised
Exercised
Lapsed
Balance at
30 June
2025
Key Management
Personnel
No.
Grant Date
No.
Fair
Value
$’000
No.
No.
No.
Value
$’000
No.
No.
Hugh Robertson Jnr
-
-
-
-
-
-
-
-
-
Joseph Demase
35,000,000
-
-
-
5,000,000
5,000,000
-
-
-
35,000,000
Natalie Mactier
4,500,000
-
-
-
1,500,000
1,500,000
-
-
-
4,500,000
Chris Scott1
250,000
-
-
-
-
-
-
-
-
250,000
Chris Wright
-
6/12/2024
4,000,000
337
-
-
-
-
-
4,000,000
Jason Ashton2
4,500,000
-
-
-
-
-
-
-
4,500,000
-
Joe Gangi2
4,500,000
-
-
-
-
-
-
-
4,500,000
-
Glen Dymond
1,100,000
-
-
-
1,100,000
1,100,000
-
-
-
1,100,000
KMP Total
49,850,000
4,000,000
337
7,600,000
7,600,000
-
-
9,000,000
44,850,000
1.
These were existing options that Chris Scott held from 2022 - they were not issued in relation to remuneration for his role as director.
2.
Jason Ashton & Joe Gangi resigned as Directors during the period and these options were forfeited
The key criteria for performance rights and options granted during the period are as follows:
•
Options – the completion of tenure periods of two and three years. There is no performance condition in relation to these
options as the Board considers the service condition is sufficient.
The weighted average fair value per option is $0.15 for the 4,000,000 options granted during the period. The following table
summarises information about performance rights and options held by KMP as at 30 June 2025.
5,000,000 performance rights and 2,850,000 options were exercisable at period end (2024: 5,000,000 performance rights and
4,800,000 options):
Issue Date and Type
Number
Grant date
Vesting date
Expiry date
Weighted average
exercise price
2020 Performance Rights - Director
5,000,000
18/12/2020
22/09/2021
18/12/2025
$0.20
2021 Performance Rights - Director
15,000,000
22/12/2021
-1
21/12/2026
$0.45
2021 Options - Director
1,500,000
22/12/2021
22/12/2023
21/12/2026
$0.45
2021 Options – Executive (3)
300,000
15/07/2021
15/07/2023
15/07/2026
$0.45
2022 Options – Executive (3)
300,000
01/09/2022
01/09/2024
01/09/2027
$0.20
2022 Options
250,000
03/10/2022
03/10/2023
03/10/2025
$0.20
2023 Options – Executive (1)
500,000
29/06/2023
29/06/2025
29/06/2028
$0.11
2023 Performance Rights - Director
15,000,000
07/12/2023
07/12/2025
07/12/2028
$0.11
2023 Options - Director
3,000,000
07/12/2023
07/12/2025
07/12/2028
$0.11
2024 Options - Executive
2,000,000
06/12/2024
06/12/2026
06/12/2029
$0.15
2024 Options - Executive
2,000,000
06/12/2024
06/12/2027
06/12/2029
$0.15
44,850,000
$0.21
1.
Vesting period is dependent on the achievement of inclusion in the S&P ASX300 Index.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
26
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
27
REMUNERATION REPORT
The fair values of options granted were determined using a variation of the binomial option pricing model that takes into account
factors specific to the ESOP, such as the vesting period. The following table lists the inputs to the Black-Scholes-Merton models
used for the LTI Grants:
Share price
Dividend yield
Expected
volatility
Risk-free interest
rate
Fair value per
option
2020 Rights
$0.415
0.0%
73.4%
0.38%
$0.3031
2021 Rights
$0.465
0.0%
45.0%
1.27%
$0.192
2021 Options
$0.465
0.0%
45.0%
1.27%
$0.3031
2021 Options (3)
$0.475
0.0%
73.4%
0.69%
$0.205
2022 Options (3)
$0.175
2.9%
96.1%
3.50%
$0.08
2023 Options (1)
$0.130
3.8%
92.8%
3.93%
$0.06
2023 Rights
$0.240
2.1%
90.0%
3.86%
$0.17
2023 Options - Director
$0.240
2.1%
90.0%
3.86%
$0.17
2024 Options
$0.170
4.9%
94.0%
3.76%
$0.08
2024 Options
$0.170
4.9%
94.0%
3.75%
$0.09
The expected volatility was determined using the group’s average five-year share price. The risk-free rate is derived from the yield
on Australian Government Bonds of an appropriate term.
Historical share price volatility has been the basis for determining expected share price volatility as it is assumed that this is
indicative of future volatility.
(E)
NON-EXECUTIVE DIRECTOR ARRANGEMENTS
Current Board fees are $110,000 per annum for the Chair and $90,000 per annum for non-executive directors.
The fees for Hugh Robertson Jnr are paid 50% In cash and 50% in fully paid ordinary shares in the Company. For the period 28
November 2024 to 30 November 2025 the share price will be the lower of 15 cents per share and the 5-day VWAP on the day
immediately prior to issue. For periods on and after 1 December 2025 the share component will be at risk and subject to quarterly
vesting hurdles and the share price will be the 5-day VWAP on the day immediately prior to issue. The issue of shares is subject to
shareholder approval and if shareholder approval is not obtained by the time of Company’s AGM each year the share component
will be paid in cash. No shares have been issued as at the date of this report.
The fees for Chris Scott are paid 50% in cash and 50% in fully paid ordinary shares in the Company. The share component will be
at risk and subject to quarterly vesting hurdles and the share price will be the 5-day VWAP on the day immediately prior to issue.
The issue of shares is subject to shareholder approval and if shareholder approval is not obtained by the time of Company’s AGM
each year the share component will be paid in cash. No shares have been issued as at the date of this report.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
28
REMUNERATION REPORT
The table below represent the amounts paid during the periods in which their services were provided.
Short term benefits
Post Employment
benefits
Long term
benefits
Share based
payments
Key Management
Personnel
Year
Cash
Salary &
Fees
Cash
STI
Annual
Leave
Superannuation
Long
Service
Leave
Options &
Performance
Rights
Total Performance
related
$
$
$
$
$
$
$
%
Non-Executive Directors
Mr Hugh Robertson
Jnr1,5
2025
32,083
-
-
-
-
32,083
64,166
50%
2024
-
-
-
-
-
-
-
-
Ms Natalie Mactier
2025
96,651
-
-
-
-
251,852
348,503
72%
2024
140,000
-
-
-
-
200,776
340,776
59%
Mr Chris Scott2
2025
-
-
-
-
-
-
-
-
2024
-
-
-
-
-
-
-
-
Mr Joe Gangi3
2025
13,750
-
-
-
-
(142,141)
(128,391)
0%
2024
160,000
-
-
-
-
200,776
360,776
56%
Mr Jason Ashton4
2025
68,182
-
-
7,841
-
(142,141)
(66,118)
0%
2024
131,818
-
-
9,000
-
200,776
341,594
59%
Total
2025
210,666
-
-
7,841
-
(347)
218,160
0%
2024
431,818
-
-
9,000
-
602,328 1,043,146
58%
1.
Mr Hugh Robertson Jnr was appointed as Chair on 28 November 2024.
2.
Mr Chris Scott was appointed on 9 May 2025.
3.
Mr Joe Gangi resigned on 13 August 2024.
4.
Mr Jason Ashton resigned on 2 May 2025.
5.
The issue of shares is subject to shareholder approval and if shareholder approval is not obtained by the time of Company’s AGM each year the share
component will be paid in cash. No shares have been issued as at the date of this report.
All Non-Executive Directors enter into a service agreement with the Group in the form of a letter of appointment. The letter
summarises the Board policies and terms, including remuneration, relevant to the office of Director.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
29
REMUNERATION REPORT
(F)
OTHER STATUTORY INFORMATION
Shareholdings
The numbers of shares in the Group held (directly, indirectly or beneficially) during the financial year by KMP, including their
related parties, are set out below.
Balance at
1 July 2024 or Date of
Appointment
Received on
the Exercise of
Option or Right
Net
Other Changes
Balance at
30 June 2025
Directors
Hugh Robertson Jnr1
-
-
280,000
280,000
Joseph Demase
58,668,719
-
-
58,668,719
Natalie Mactier
1,000,000
-
-
1,000,000
Chris Scott2
-
-
-
-
Joe Gangi3
7,745,040
-
(7,745,040)
-
Jason Ashton4
4,967,147
-
(4,967,147)
-
Total Directors
72,380,906
-
(12,432,187)
59,948,719
Other Management Personnel (OMP)
Chris Wright
7,294,118
-
-
7,294,118
Glen Dymond5
1,239,813
-
(1,239,813)
-
Total OMP
8,533,931
-
(1,239,813)
7,294,118
Group Total
80,914,837
-
(13,672,000)
67,242,837
1.
Mr Hugh Robertson Jnr was appointed on 27 November 2024.
2.
Mr Chris Scott was appointed on 9 May 2025.
3.
Mr Joe Gangi resigned on 13 August 2024.
4.
Mr Jason Ashton resigned on 2 May 2025.
5.
Mr Glen Dymond resigned on 13 September 2024.
Voting and comments made at the Company’s Annual General Meeting
The Company received 36.01% of ‘yes’ votes on its Remuneration Report for the financial year ending 30 June 2024, which
constituted a ‘first strike’ for the purposes of the Corporations Act 2001. The Company received more than 75% favourable
votes in relation to its 2023 Remuneration Report. The Company received no specific feedback on its 2024 Remuneration
Report at the Annual General Meeting
Service Agreements
Remuneration and other terms of employment for the Managing Director and other Key Management Personnel are formalised in
an Executive Service Agreement between the Company and each executive:
Executive
Base Salary
Term of Agreement
Notice Period
Joseph Demase
$350,000
Unspecified
6 months
Chris Wright
$350,000
Unspecified
6 months
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
30
REMUNERATION REPORT
Loans to Key Management Personnel
(i)
Executive and Director Share Plan
Under the Executive and Director Share Plan the Company
may loan its Executives some or all of the amount of the
exercise price for options exercised to acquire shares.
Such loans are non-recourse and no interest is charged in
respect of the loan amounts. The executive does not have a
beneficial interest in the shares until the loan is repaid with
any such shares subject to a holding lock. For accounting
purposes, this arrangement is not considered as loan
receivable but considered as share-based payment in
substance. The granting of a loan is considered to be a
modification to the existing option. Any increase in the fair
value of the option recognised as an expense immediately at
the date the loan is granted. If the executive fails to repay the
loan, the Company can sell some of the shares to repay the
loan. In the event that the shares are sold for an amount less
than the value of the loan, the executive is only required to
repay the loan out of the sale proceeds. The Company has no
other recourse against the employee. During the year no
loans were provided under the Executive and Director Share
Plan (2024: Nil).
(ii)
Other Loans
During the year ended 30 June 2021, the Group granted loans
of $280,000 to key management personnel, $140,000 each
(Glen Dymond and Garry White) to allow them to take up
shares in a capital raising being undertaken by the Company.
Loan repayments of $148,400 were made during the year
ended 30 June 2022 ($74,200 from Glen Dymond and
$74,200 from Garry White). No repayments were made during
the year ended 30 June 2025.The loans are non-recourse.
The table below provides aggregate information relating to
the Company’s loans to KMP during the year:
2025
$000
Balance at the start of the year
128
Repayment from KMP
-
Balance at the end of the year
128
Other Transactions with Key Management Personnel
During the year, the Group has conducted the following
related party transactions:
•
A total of $41,791 (2024: $871,622) was paid to Studio
Inc., an entity related to Joseph Demase, for the design of
marketing materials for the Group. All transactions are
carried at commercial third-party rates.
There were no other transactions with KMP during the year
ended 30 June 2025.
End of Remuneration Report
This report, incorporating the Remuneration Report is signed
in accordance with a resolution of Directors.
Hugh Robertson Jnr
Chair
25 September 2025
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
31
CORPORATE GOVERNANCE STATEMENT
The Board of 5G Networks Limited (5GN or the Company) recognises the need for the highest standards of corporate behaviour
and accountability. The Board is committed to optimising security holder returns within a framework of ethical business
practices.
5GN’s corporate governance practices and policies comply with the ASX Corporate Governance Council’s Corporate
Governance Principles and Recommendations (4th Edition) (the Governance Principles and Recommendations), the ASX Listing
Rules and the Corporations Act 2001 (Cth). This Statement reflects a summary of 5GN’s corporate governance framework,
policies and procedures that are in place and operating as at the date of this report.
Further information on 5GN’s corporate governance policies, including Board and Committee charters, are available from the
Corporate Governance page of the Company’s website.
Principles & Recommendations
Compliance
Comply
Principle 1 – Lay solid foundations for management and oversight
1.1 Establish the functions expressly
reserved to the Board and those
delegated to management, and disclose
those functions.
The Board is responsible for the overall corporate governance of the
Company. It has adopted various charters and key
corporate governance documents which set out the policies and
procedures followed by the Company.
Compliant
1.2 Undertake appropriate checks before
appointing a person as a director, and
provide security holders with all material
information in its possession relevant to a
decision on whether or not to elect or re-
elect a director.
The Company has, and will continue to conduct, appropriate
searches in relation to all appointed and future nominated directors.
It will carry out necessary background checks, including ASIC
Banned & Disqualified Persons Register and bankruptcy searches for
all appointed and future nominated directors.
The Company has published profiles of its directors on the
Company’s website outlining biographical details, other directorships
held, commencement date of office and level of independence.
Compliant
1.3 Have a written agreement with each
director and senior executive setting out
the terms of their appointment.
The Company has written agreements with each director and senior
executive. On appointment of directors and senior executives the
Company will issue necessary written agreements outlining the terms
of their appointment.
Compliant
1.4 The company secretary should be
accountable directly to the Board on all
matters to do with the proper functioning
of the Board.
The Company Secretary reports directly to the Board, through the
Chairman, on matters relating to the proper functioning of the Board.
All Directors have access to the Company Secretary.
Compliant
1.5 Establish a diversity policy and
disclose the policy. The policy should
include requirements for the Board to
establish measurable objectives for
achieving gender diversity and for
the Board to assess annually both the
objectives and progress in achieving
them, for reporting against in each
reporting period.
The Company is committed to promoting a diverse workplace where
everyone is treated with respect regardless of gender, age, race,
disability, language, cultural background or sexual preference.
The Company has a Diversity & Inclusion Policy that outlines how it
meets the highest standard of inclusion and respect. The Diversity &
Inclusion Policy is available from the Corporate Governance page of
the Company’s website.
The Company has not, during the reporting period, established
measurable objectives for achieving gender diversity, nor does it
disclose gender-based statistics. As such, the Company is not in full
compliance with Recommendation 1.5 of the Governance Principles
and Recommendations.
Not
Compliant
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
32
CORPORATE GOVERNANCE STATEMENT
Principles and Recommendations
Compliance
Comply
1.6 Have a process for periodically
evaluating the performance of the Board,
its committees and individual directors,
and disclose that process and, at the end
of each reporting period, whether such
performance evaluation was undertaken in
that period.
The Nomination and Remuneration Committee (‘NRC’) is
responsible for, among other things, reviewing the Board’s
performance, policies and practices, and reviewing the performance
of its Committees and the Board and Committee Chairs.
The NRC, which operates under a nomination and remuneration
committee charter, currently comprises the following Directors:
•
Hugh Robertson Jnr (Committee Chair, Independent,
Non-Executive Director);
•
Natalie Mactier (Independent, Non-Executive Director);
•
Chris Scott (Independent, Non-Executive Director); and
•
Joseph Demase (Managing Director and CEO).
The NRC meets at least twice a year and operates in accordance
with its charter which is available on the Corporate Governance
page of the Company’s website.
Compliant
1.7 The Company should have a process
evaluating the performance of the
Company’s senior executives, and
disclose that process and, at the end of
each reporting period, whether such
performance evaluation was undertaken in
that period.
The Managing Director (MD) reviews the performance of the senior
executives on a regular basis throughout the reporting period.
Additionally, the Board reviews the Managing Director’s
performance throughout the reporting period. These reviews were
conducted in the current reporting period.
Compliant
Principle 2 – Structure the Board to be effective and add value
2.1 The Company should have a
nomination committee, which has at least
three members, a majority of independent
directors and is chaired by an
independent director. The functions and
operations of the nomination committee
should be disclosed.
A Nomination and Remuneration Committee (‘NRC’) has been
established with its own charter and currently comprises the
following Directors:
•
Hugh Robertson Jnr (Committee Chair, Independent
Non-Executive Director);
•
Natalie Mactier (Independent, Non-Executive Director);
•
Chris Scott (Independent, Non-Executive Director); and
•
Joseph Demase (Managing Director and CEO).
The primary objective of the NRC is to assist the Board with the
discharge of its responsibilities with respect to constitution of the
members of the Board of Directors and the remuneration of
directors and senior management as set out in its charter which is
available on the Corporate Governance page of the Company’s
website.
Compliant
2.2 Have and disclose a board skills
matrix, setting out what the board is
looking to achieve in its membership.
The NRC undertakes its deliberations in accordance with the rules
set out in its charter. The NRC seeks to ensure that the Directors
have a broad range of experience, expertise, skills, qualifications
and contacts and that they are relevant to the Company and its
business.
Compliant
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
33
CORPORATE GOVERNANCE STATEMENT
Principles and Recommendations
Compliance
Comply
2.3 Disclose the names of the directors
that the Board considers to be
independent directors, and an explanation
of why the Board is of that opinion if a
factor that impacts on independence
applies to a director, and disclose the
length of service of each director
The Board considers Hugh Robertson Jnr (Non-Executive Director,
appointed 27 November 2024), Natalie Mactier (Non-Executive
Director, appointed 22 October 2020) and Chris Scott (Non-
Executive Director, appointed 9 May 2025) to be independent
directors.
The Board notes that Joseph Demase is not an independent director
for the purposes of the Governance Principles and
Recommendations. Mr Demase is Managing Director and Chief
Executive Officer of the Company.
Compliant
2.4 A majority of the Board should be
independent directors.
The Board is presently comprised of four directors, of which three
are independent, non-executive directors.
Compliant
2.5 The Chair of the Board should be an
independent director and should not be
the CEO.
The Chair of the Board, Hugh Robertson Jnr, is an independent, non-
executive director.
Compliant
2.6 The Company should have a program
for inducting new directors and providing
appropriate professional development
opportunities for directors to develop and
maintain the skills and knowledge needed
to perform their role as a director
effectively
The Board Charter provides a program for inducting new directors
and requires that directors have access to opportunities for
professional development so as to ensure the continual development
of their skills and knowledge.
The Board Charter is available on the Corporate Governance page of
the Company’s website.
Compliant
Principle 3 – Act lawfully, ethically and responsibly
3.1 The Company should articulate and
disclose its values
The Company articulates and discloses its guiding principles and
values in its Code of Conduct. The Code of Conduct is available on
the Corporate Governance page of the Company’s website.
Compliant
3.2 The Company should have a Code of
Conduct and ensure that any material
breaches of that Code are reported.
The Company has a Code of Conduct that articulates the standards
of behaviour it expects of its directors, senior executives and
employees.
The Code also sets out the process for identifying and reporting
material breaches of the Code. The Code of Conduct is available on
the Corporate Governance page of the Company’s website.
Compliant
3.3 The Company should have a
whistleblower policy and ensure that the
Board is informed of any material
breaches reported under that policy.
The Company encourages directors, senior executives and
employees to speak up about any unlawful, unethical or irresponsible
behaviour within the organisation.
The Company has a Whistleblower Policy to guide the directors,
senior executives and employees as to the practices necessary to
report unlawful, unethical or irresponsible behaviour.
The Policy is available on the Corporate Governance page of the
Company’s website.
Compliant
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
34
CORPORATE GOVERNANCE STATEMENT
Principles and Recommendations
Compliance
Comply
3.4 The Company should have an anti-
bribery and corruption policy and ensure
that the Board is informed of any material
breaches reported under that policy
The Company recognises the serious criminal and civil penalties that
may be incurred and the reputational damage that may be done, if
the Company and any of its directors, as well as officers, employees,
contractors, consultants and other persons that act on its behalf,
engages in bribery or corruption.
The Company has an Anti-Bribery and Corruption policy that
articulates the standards of behaviour it expects of its directors,
senior executives and employees as regards observing and
upholding the prohibition on bribery and related improper conduct.
The Company’s Anti-Bribery and Corruption Policy is available on the
Corporate Governance page of the Company's website.
Compliant
Principle 4 – Safeguard the integrity of corporate reports
4.1 The Company should have an audit
committee, which consists of only Non-
Executive Directors, a majority of
independent directors, is chaired by an
independent chairman who is not
chairman of the Board, and has at least
three members. The functions and
operations of the audit committee should
be disclosed.
The Board has established an Audit and Risk Committee (‘ARC’)
which operates under an audit and risk committee charter.
The Audit and Risk Committee members are:
•
Hugh Robertson Jnr (Committee Chair, Independent,
Non-Executive Director);
•
Natalie Mactier (Independent, Non-Executive Director);
•
Chris Scott (Independent, Non-Executive Director); and
•
Joseph Demase (Managing Director and CEO).
The ARC oversees the Company’s corporate reporting process
pursuant to the rules of its Charter which is available on the
Corporate Governance page of the Company’s website.
Compliant
4.2 The Board should, before approving
financial statements for a financial period,
receive a declaration from the CEO and
CFO that, in their opinion, the financial
records have been properly maintained
and that the financial statements comply
with the appropriate accounting standards
and give a true and fair view of the
financial position and performance of the
Company, formed on the basis of a sound
system of risk management and internal
controls, operating effectively.
In accordance with section 295A of the Corporations Act 2001 (Cth),
each year the CEO and CFO state in writing to the Board that, for the
relevant financial year, the financial records of the Company have
been properly maintained, the financial statements and the notes
comply with the accounting standards and give a true and fair view
of the financial position and performance of the Company, and that
their statement has been provided on the basis of a sound system of
risk management and internal control which is operating effectively.
Compliant
4.3 The Company’s auditor should attend
the AGM and be available to answer
questions from security holders relevant
to the audit.
External auditors attend the Company’s Annual General Meeting and
are available to answer reasonable questions from security holders in
relation to the conduct of the audit, the preparation and content of
the independent audit report and the accounting policies adopted by
the Company.
Compliant
Principle 5 – Make timely and balanced disclosure
5.1 The Company should have a written
policy for complying with its continuous
disclosure obligations under ASX Listing
Rule 3.1.
The Company has a Disclosure Policy which is designed to ensure
that all material matters are appropriately disclosed in a balanced
and timely manner and in accordance with the requirements of the
ASX Listing Rules.
The Policy is available on the Corporate Governance page of the
Company’s website.
Compliant
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
35
CORPORATE GOVERNANCE STATEMENT
Principles and Recommendations
Compliance
Comply
5.2 The Company should ensure that its
Board receives copies of all material
market announcements promptly after
they have been made.
The Company’s Disclosure Policy provides that the Board receives
market announcements promptly after they have been made.
The Policy is available on the Corporate Governance page of the
Company’s website.
Compliant
5.3 The Company should release copies
of presentation materials on the ASX
Market Announcements Platform ahead of
the presentation.
The Company diligently releases copies of all of its presentation
materials on the ASX Market Announcements Platform ahead of
presentations.
Compliant
Principle 6 – Respect the rights of security holders
6.1 The Company should provide
information about itself and its
governance to investors via its website
The Corporate Governance landing page on the Company’s website
contains a range of documents concerning information about the
entity and its governance that security holders can download.
Further information about the Company’s Corporate Governance
regime can be found on the Corporate Governance page of the
Company’s website.
Compliant
6.2 The Company should have an investor
relations program that facilitates effective
two-way communication with investors.
The Company will use its website, half year and annual reports,
market announcements and media disclosures to communicate with
its security holders, as well as encourage participation at general
meetings.
Compliant
6.3 The Company should disclose how it
facilitates and encourages participation at
meetings of security holders.
The Company’s security holders have the opportunity to ask
questions of the Company’s external auditors who attend the
Company’s annual general meeting.
Further, the Company has adopted a range of appropriate
technologies to facilitate two-way engagement at its annual general
meetings.
Compliant
6.4 The Company should ensure that all
substantive resolutions at a meeting of
security holders are decided by a poll.
All resolutions at meetings of security holders are decided on a poll.
Compliant
6.5 The Company should give security
holders the option to receive
communications from, and send
communications to, the Company and its
security registry electronically.
The Company’s security holders have the option to electronically
receive communications from, and send communications to, the
Company and its security registry.
Compliant
Principle 7 – Recognise and manage risk
7.1 The Board should have a committee
to oversee risk with at least three
members, a majority of whom are
independent directors; and is chaired by
an independent director.
The Board has established an Audit and Risk Committee (‘ARC’)
which operates under an audit and risk committee charter.
The Audit and Risk Committee members are:
•
Hugh Robertson Jnr (Committee Chair, Independent,
Non-Executive Director);
•
Natalie Mactier (Independent, Non-Executive Director);
•
Chris Scott (Independent, Non-Executive Director); and
•
Joseph Demase (Managing Director and CEO).
The ARC oversees the Company’s corporate reporting process
pursuant to the rules of its Charter which is available on the
Corporate Governance page of the Company’s website.
Compliant
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
36
CORPORATE GOVERNANCE STATEMENT
Principles and Recommendations
Compliance
Comply
7.2 The Board should review the
Company’s risk management framework
at least annually; and disclose, in relation
to each reporting period, whether such a
review has taken place.
The ARC meets three times per year and a risk review is conducted
in relation to each reporting period.
Compliant
7.3 The Company should disclose if it has
an internal audit function, how the
function is structured and what role it
performs, or if it does not have an internal
audit function, that fact and the processes
the Company employs for evaluating and
continually improving the effectiveness of
its risk management and internal control
processes.
The ARC oversees the Company’s internal audit program. It reviews
and approves the Company’s internal audit plan and monitors the
progress of the Company’s internal audit.
Compliant
7.4 The Company should disclose
whether the Company has any material
exposure to economic, environmental and
social sustainability risks and, if so, how it
manages those risks.
The Board does not believe that the Company has any such
material risks.
While the Company is not exposed to such risks, the Board has
adopted an Environment & Sustainability Policy to deal with such
risks if they are ever to eventuate.
The Environment & Sustainability Policy is available on the Corporate
Governance page of the Company’s website.
Compliant
Principle 8 – Remunerate fairly and responsibly
8.1 The Board should have a
remuneration committee which is
structured so that it consists of a majority
of independent directors, is chaired by an
independent director, and has at least
three members. The functions and
operations of the remuneration committee
should be disclosed.
A Nominations and Remuneration Committee (‘NRC’) has been
established with its own charter and consists of the following
Directors:
•
Hugh Robertson Jnr (Committee Chair, Independent,
Non-Executive Director);
•
Natalie Mactier (Independent, Non-Executive Director);
•
Chris Scott (Independent, Non-Executive Director); and
•
Joseph Demase (Managing Director and CEO).
The primary objective of the NRC is to assist the Board with the
discharge of its responsibilities as set out in its charter which is
available on the Corporate Governance page of the Company’s
website.
Compliant
8.2 The Company should disclose its
policies and practices regarding the
remuneration of non-executive directors
and the remuneration of executive
directors and other senior executives.
The NRC oversees the policies and practices regarding the
remuneration of non-executive directors, and the remuneration of
executive directors and other senior executives.
Compliant
8.3 The Company should have a policy on
whether participants are permitted to
enter into transactions (whether through
the use of derivatives or otherwise) which
limit the economic risk of participating in
the scheme, and disclose that policy or a
summary of it.
The Company operates an Executive and Director Share Option Plan
(ESOP) in which directors and senior management participate. In
accordance with the Company’s Share Trading Policy, participants
are not permitted to enter into transactions which limit economic risk
without written clearance.
Compliant
Grant Thornton Audit Pty Ltd
Level 22 Tower 5
Collins Square
727 Collins Street
Melbourne VIC 3008
GPO Box 4736
Melbourne VIC 3001
T +61 3 8320 2222
www.grantthornton.com.au
ACN-130 913 594
Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Limited ABN 41 127 556 389 ACN 127 556 389.
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or
refers to one or more member firms, as the context requires. Grant Thornton Australia Limited is a member firm of Grant Thornton International Ltd (GTIL).
GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member
firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one
another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127
556 389 ACN 127 556 389 and its Australian subsidiaries and related entities. Liability limited by a scheme approved under Professional Standards
Legislation.
Auditor’s Independence Declaration
To the Directors of 5G Networks Limited
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit
of 5G Networks Limited for the year ended 30 June 2025, I declare that, to the best of my knowledge and belief,
there have been:
a
no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the
audit; and
b
no contraventions of any applicable code of professional conduct in relation to the audit.
Grant Thornton Audit Pty Ltd
Chartered Accountants
M J Climpson
Partner – Audit & Assurance
Melbourne, 25 September 2025
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
38
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
Financial Statements
For The Year Ended
30 June 2025
5G NETWORKS LTD
AND ITS CONTROLLED ENTITIES
ABN 21 073 716 793
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
39
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2025
Notes
Year ended
30 June 2025
$000
30 June 2024
$000
CONTINUING OPERATIONS
Revenue
5
62,634
49,336
Other income
6
3,688
3,536
Revenue and other income
66,322
52,872
Network and data centre costs
(32,672)
(28,229)
Rent and office expenses
(1,304)
(481)
Marketing and travel expenses
(614)
(721)
Employee benefits expenses
(24,034)
(21,433)
Other expenses
(4,456)
(4,540)
Loss on remeasurement of assets held for sale
16
(3,339)
-
Loss on sale of investments
-
(157)
Impairment of assets
14
(7,629)
(6,911)
Share-based payment expenses
(1,829)
(1,885)
Depreciation expenses
(6,571)
(6,849)
Amortisation expenses
(554)
(801)
Finance costs
(1,169)
(2,643)
Net gain/(loss) on fair value of financial instruments at FVTPL
435
-
Non-recurring costs
(2,479)
(8,315)
Total expenses
(86,215)
(82,965)
Loss before income tax
(19,893)
(30,093)
Income tax (expense) / benefit
9,757
2,085
Loss after tax
(10,136)
(28,008)
DISCONTNUED OPERATION
Profit from discontinued operation, net of tax
-
77,424
Profit/ (Loss) after tax for the year
(10,136)
49,416
Other comprehensive income for the year, net of income tax
Items that will be reclassified to profit or loss in subsequent years:
- Currency translation differences
(66)
(141)
Items that will not be reclassified to profit or loss in subsequent years:
- Change in fair value of equity instruments designed at fair value through other
comprehensive income
-
-
Other comprehensive income for the year, net of income tax
(66)
(141)
TOTAL COMPREHENSIVE INCOME FOR THE YEAR
(10,202)
49,275
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
40
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2025
Notes
Year ended
30 June 2025
$000
30 June 2024
$000
Profit/(Loss) for the year attributable to:
Members of the parent
(9,744)
49,416
Non-controlling interests
(392)
-
(10,136)
49,416
Total comprehensive income attributable to:
Members of the parent
(9,810)
49,275
Non-controlling interests
(392)
-
(10,202)
49,275
Total comprehensive income attributable to members of the parent arises from:
Continuing operations
(9,811)
(28,149)
Discontinued operations
-
77,424
(9,811)
49,275
30-Jun-25
cents per share
30-Jun-24
cents per share
Loss per share from continuing operations
Basic (oss per share
7
(3.21)
(8.36)
Diluted loss per share
7
(3.21)
(8.36)
Profit/(Loss) per share attributable to members of the parent
Basic (loss) / profit per share
7
(3.23)
14.71
Diluted (loss) / profit per share
7
(3.23)
14.71
The above Consolidated Statement of Comprehensive Income should be read in conjunction with the accompanying notes.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
41
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
FOR THE YEAR ENDED 30 JUNE 2025
Notes
Year ended
30 June 2025
$000
30 June 2024
$000
ASSETS
Current Assets
Cash and cash equivalents
9
25,914
64,986
Restricted cash
9
3,315
2,925
Trade and other receivables
10
8,865
522
Contract assets
11
975
-
Other assets
17
4,358
871
43,427
69,304
Assets classified as held for sale
16
-
31,277
Total Current Assets
43,427
100,581
Non-Current Assets
Property, plant and equipment
12
15,151
-
Right-of-use assets
13
7,589
-
Goodwill
14
4,429
-
Other intangible assets
15
4,075
-
Other investments
725
725
Other assets
17
125
426
Total Non-Current Assets
32,094
1,151
TOTAL ASSETS
75,521
101,732
LIABILITIES
Current Liabilities
Trade and other payables
18
7,601
5,024
Lease liability
13
5,323
-
Employee benefits
20
2,895
-
Provision for income tax
-
14,352
Contract liabilities
11
304
-
Other financial liabilities
(109)
-
Other liabilities
19
3,641
-
19,655
19,376
Liabilities directly associated with assets classified as held for sale
16
-
29,751
Total Current Liabilities
19,655
49,127
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
42
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
FOR THE YEAR ENDED 30 JUNE 2025
Notes
Year ended
30 June 2025
$000
30 June 2024
$000
Non-Current Liabilities
Lease liability
13
10,779
-
Employee benefits
20
280
-
Deferred tax liabilities
473
-
Total Non-Current Liabilities
11,532
-
TOTAL LIABILITIES
31,187
49,127
NET ASSETS
44,334
52,605
EQUITY
Share capital
22
195,464
198,292
Reserves
23
(127,579)
(130,054)
Accumulated losses
(25,377)
(15,633)
Equity attributable to members of the parent
42,508
52,605
Non-controlling interests
21
1,826
-
TOTAL EQUITY
44,334
52,605
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
43
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2025
Notes
Share Capital
Reserves
Accumulated
Losses
Non-
controlling
Interest
Total Equity
$000
$000
$000
$000
$000
BALANCE AT 1 JULY 2024
198,292
(130,054)
(15,633)
-
52,605
Profit for the period
-
-
(9,744)
(392)
(10,136)
Other comprehensive income
-
(66)
-
-
(66)
Total comprehensive income for
the period
-
(66)
(9,744)
(392)
(10,202)
Share based payments expensed
23
1,829
1,829
Transactions with owners in their
capacity as owners:
Cancellation of shares pursuant to
on-market buy back
22
(2,828)
(2,828)
NCI arising on acquisition of subsidiary
21
2,218
2,218
Other Transactions
23
712
712
BALANCE AT 30 JUNE 2025
195,464
(127,579)
(25,377)
1,826
44,334
BALANCE AT 1 JULY 2023
200,521
(132,049)
(58,202)
-
10,270
Profit for the period
-
-
49,416
-
49,416
Other comprehensive income
-
(141)
-
-
(141)
Total comprehensive income for
the period
-
(141)
49,416
-
49,275
Share based payments expensed
-
2,136
-
-
2,136
Transactions with owners in their
capacity as owners:
Dividend paid
-
-
(6,847)
-
(6,847)
Shares issued as acquisition
consideration
22
1,240
-
-
-
1,240
Shares issued on exercise of Options
22
280
-
-
-
280
Cancellation of shares pursuant to
on-market buy back
22
(3,145)
-
-
-
(3,145)
Cancellation of shares pursuant to
unmarketable parcel share buy back
22
(580)
-
-
-
(580)
Share issue costs
(24)
-
-
-
(24)
BALANCE AT 30 JUNE 2024
198,292
(130,054)
(15,633)
-
52,605
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
44
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2025
Notes
Year ended
30 June 2025
$000
30 June 2024
$000
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
68,768
78,576
Payments to suppliers and employees
(80,037)
(80,674)
Interest received
5,445
1,330
Interest paid
(770)
(2,642)
Income tax paid
(4,289)
(334)
Payments for acquisition and restructuring costs
(2,479)
(10,726)
NET CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES
(13,362)
(14,470)
CASH FLOWS FROM INVESTING ACTIVITIES
Net cash on purchase of Security Shift
(1,100)
(1,615)
Proceeds from sale of Domains business
-
107,420
Proceeds from sale of investments
-
20,154
Proceeds from sale of Digital business
-
163
Net cash on purchase of New Domain
-
(1,500)
Net cash on purchase of AUCyber
(15,009)
-
Purchase of plant and equipment
(3,988)
(2,782)
Proceeds from sale of intangible assets
-
1,637
Proceeds from sale of plant and equipment
1,211
60
Purchase of intangible assets
-
-
Increase in pledged bank deposits
(390)
(2,925)
Return of capital and dividends received from investments
-
27
NET CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES
(19,276)
120,639
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issues of shares on exercise of options
-
280
Proceeds from borrowings
-
500
Payment of security deposit
(1,350)
(828)
Payments of share buyback
(4,556)
(1,013)
Repayment of borrowings
-
(29,730)
Payment of equity transaction costs
-
(24)
Payment of dividend on ordinary shares
-
(6,847)
Payment of lease liabilities
(3,798)
(4,725)
NET CASH FLOWS USED IN FINANCING ACTIVITIES
(9,704)
(42,387)
NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS
(42,342)
63,782
NET INCREASE / (DECREASE) IN CASH CLASSIFIED WITHIN CURRENT
ASSETS HELD FOR SALE
3,336
(3,336)
Net foreign exchange differences
(66)
42
Cash and cash equivalents at beginning of period
64,986
4,498
CASH AND CASH EQUIVALENTS AT END OF PERIOD
9
25,914
64,986
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
45
NOTES TO THE FINANCIAL STATEMENTS
1. CORPORATE INFORMATION
The consolidated financial statements of 5G Networks
Limited (‘the Company’ or ‘5GN’) and its subsidiaries
(collectively, ‘the Group’) for the year ended 30 June 2025
were authorised for issue in accordance with a resolution of
the directors on 25 September 2025.
OPERATIONS AND PRINCIPAL ACTIVITIES
The principal activities of the Group during the period are
described below:
Continuing operations
5G Networks provides the following services to enterprise
and wholesale customers:
•
the supply of cloud-based solutions, managed services
and network services
•
the operation of fibre and wireless infrastructure and
management of cloud computing environment
•
the operation of data centre facilities
REGISTERED OFFICE AND PRINCIPAL PLACE
OF BUSINESS
The registered office and principal place of business of the
Company is Level 7, 505 Little Collins Street, Melbourne
Victoria 3000.
2. MATERIAL ACCOUNTING POLICIES
BASIS OF PREPARATION
These general purpose financial statements have been
prepared in accordance with Australian Accounting Standard
and s Interpretations issued by the Australian Accounting
Standards Board (AASB) and the Corporations Act 2001, as
appropriate for for-profit oriented entities.
These financial statements also comply with International
Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board (IASB).
The financial statements have been prepared on an accruals
basis except for cash flow information. The financial
statements have been prepared on a historical cost basis,
except for assets held for sale which have been measured at
the lower of carrying amount and fair value less costs to sell.
GOING CONCERN
The financial report for the full year ended 30 June 2025 has
been prepared on the going concern basis that contemplates
the continuity of normal business activities and the realisation
of assets and extinguishment of liabilities in the ordinary
course of business.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
46
NOTES TO THE FINANCIAL STATEMENTS
NEW OR AMENDED ACCOUNTING STANDARDS NOT
YET ADOPTED IN THE PERIOD
At the date of authorisation of these financial statements,
several new, but not yet effective, Standards and
amendments to existing Standards, and Interpretations have
been published by AASB.
None of these Standards or amendments to existing
Standards have been adopted early by the Group.
Management anticipates that all relevant pronouncements will
be adopted for the first period beginning on or after the
effective date of the pronouncement. New Standards,
amendments and Interpretations not adopted in the current
year have not been disclosed as they are not expected to
have a material impact on the Group’s financial statements.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements incorporate the assets
and liabilities of all subsidiaries of 5G Networks Limited as at
30 June 2025 and the result of all subsidiaries for the year
then ended.
Subsidiaries are all those entities over which the Group has
control. The group controls an entity when the group is
exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those
returns through its power to direct the activities of the entity.
Subsidiaries are fully consolidated from the date on which
control is transferred to the Group. They are deconsolidated
from the date that control ceases.
Intercompany transactions, balances and unrealised gains on
transactions between entities in the Group are eliminated.
Unrealised losses are also eliminated unless the transaction
provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with the policies adopted by
the Group.
The acquisition of subsidiaries is accounted for using the
acquisition method of accounting. Refer to the ‘Business
Combinations’ accounting policy for further details.
A change in ownership interest, without the loss of control, is
accounted for as an equity transaction, where the difference
between the consideration transferred and the book value of
the share of the non-controlling interest acquired is
recognised directly in equity attributable to the parent.
Where the Group loses control over a subsidiary, it
derecognises the assets including goodwill, liabilities and
non-controlling interest in the subsidiary together with any
cumulative translation differences recognised in equity.
The Group recognises the fair value of the consideration
received and the fair value of any investment retained
together with any gain or loss in profit or loss.
BUSINESS COMBINATIONS
The acquisition method of accounting is used to account for
business combinations regardless of whether equity
instruments or other assets are acquired.
The consideration transferred is the sum of the acquisition
date fair values of the assets transferred, equity instruments
issued or liabilities incurred by the acquirer to former owners
of the acquire and the amount of any non-controlling interest
in the acquiree. For each business combination, the non-
controlling interest in the acquiree is measured at either fair
value or at the proportionate share of the acquirer’s
identifiable net assets. All acquisition costs are expensed as
incurred to profit or loss.
On the acquisition of a business, the Group assesses the
financial assets acquired and liabilities assumed for
appropriate classification and designation in accordance with
the contractual terms, economic conditions, the Group’s
operating or accounting policies and other pertinent
conditions in existence at the acquisition date.
Where the business combination is achieved in stages, the
Group remeasures its previously held equity interest in the
acquiree at the acquisition-date fair value and the difference
between the fair value and the previous carrying amount is
recognised in profit or loss.
Contingent consideration to be transferred by the acquirer is
recognised at the acquisition date fair value. Subsequent
changes in the fair value of contingent consideration
classified as an asset or liability is recognised in profit or loss.
Contingent consideration classified as equity is not
remeasured and its subsequent settlement is accounted for
within equity.
The difference between the acquisition date fair value of
assets acquired, liabilities assumed and any non- controlling
interest in the acquiree and the fair value of the consideration
transferred and the fair value of any pre-existing investment in
the acquiree is recognised as goodwill. If the consideration
transferred and the pre-existing fair value is less than the fair
value of the identifiable net assets acquired, being a bargain
purchase to the acquirer, the difference is recognised as a
gain directly in profit or loss by the acquirer on the acquisition
date, but only after a reassessment of the identification and
measurement of the net assets acquired, the non-controlling
interest in the acquiree, if any, the consideration transferred
and the acquirer’s previously held equity interest in
the acquiree.
Business combinations are initially accounted for on a
provisional basis. The acquirer retrospectively adjusts the
provisional amounts recognised and also recognises
additional assets or liabilities during the measurement period,
based on new information obtained about the facts and
circumstances that existed at the acquisition-date.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
47
NOTES TO THE FINANCIAL STATEMENTS
The measurement period ends on either the earlier of (i) 12
months from the date of the acquisition or (ii) when the
acquirer receives all the information possible to determine
fair value.
ASSOCIATES AND EQUITY METHOD
Associates are all entities over which the group has significant
influence but not control or joint control. This is generally the
case where the Group holds between 20% and 50% of voting
rights. Investments in associates are accounted for using the
equity method of accounting after initially being recorded
at cost.
Under the equity method of accounting, the investments are
initially recorded at cost and adjusted thereafter to recognise
the group’s share of the post-acquisition profits or losses of
the investee in profit or loss, and the group’s share of
movements in other comprehensive income of the investee in
other comprehensive income. Dividends received or
receivable from associates are recognised as a reduction in
the carrying amount of the investment.
FOREIGN CURRENCY TRANSACTIONS
Both the functional and presentation currency of the Group
and its Australian subsidiaries is Australian dollars (AUD).
Transactions in foreign currencies are initially recorded in the
functional currency at the exchange rates ruling at the date of
the transaction. Monetary assets and liabilities denominated
in foreign currencies are retranslated at the rate of exchange
ruling at the reporting date. Non-monetary items that are
measured in terms of historical cost in a foreign currency are
translated using the exchange rate as at the date of the
initial transaction.
The assets and liabilities of overseas subsidiaries are
translated into the presentation currency of the Group at the
rate of exchange ruling at the reporting date, and the
statement of comprehensive income is translated at the
weighted average exchange rates for the period.
The exchange differences arising on retranslation are taken
directly to other comprehensive income. On disposal of a
foreign entity, the deferred cumulative amount recognised in
other comprehensive income relating to that particular foreign
operation is recognised in the determination of profit and loss
for the period.
On consolidation, exchange differences arising from the
translation of any net investment in foreign entities, and of
borrowings and other financial instruments designed as
hedges of such investments, are taken to the foreign currency
translation reserve in equity. When a foreign operation is sold,
or any borrowings forming part of the net investment are
repaid, a proportionate share of such exchange differences is
recognised in the statement of comprehensive income, as
part of the gain on sale or loss on sale where applicable.
INCOME TAX
The income tax expense or benefit for the period is the tax
payable on that period’s taxable income based on the
applicable income tax rate for each jurisdiction, adjusted by
changes in deferred tax assets and liabilities attributable to
temporary differences, unused tax losses and the adjustment
recognised for prior periods, where applicable.
(i)
Current Taxes
Current tax assets and liabilities for the current period are
measured at the amount expected to be recovered from or
paid to the taxation authorities based on the current period’s
taxable income. The tax rates and tax laws used to compute
the amount are those that are enacted or substantively
enacted at the reporting date.
Current income tax relating to items recognised directly in
equity is recognised in equity and not in profit or loss.
Management periodically evaluates positions taken in the tax
returns with respect to situations in which applicable tax
regulations are subject to interpretation and establishes
provisions where appropriate.
(ii)
Deferred Taxes
Deferred tax assets and liabilities are recognised for
temporary differences at the tax rates expected to apply when
the assets are recovered or liabilities are settled, based on
those tax rates that are enacted or substantively enacted,
except for:
•
When the deferred income tax asset or liability arises
from the initial recognition of goodwill or an asset or
liability in a transaction that is not a business
combination and that, at the time of the transaction,
affects neither the accounting nor taxable profits; or
•
When the taxable temporary difference is associated
•
with interests in subsidiaries, associates or joint
ventures, and the timing of the reversal can be
controlled and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred tax assets are recognised for deductible temporary
differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those
temporary differences and losses.
The carrying amount of recognised and unrecognised
deferred tax assets are reviewed each reporting date.
Deferred tax assets recognised are reduced to the extent that
it is no longer probable that future taxable profits will be
available for the carrying amount to be recovered.
Previously unrecognised deferred tax assets are recognised
to the extent that it is probable that there are future taxable
profits available to recover the asset.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
48
NOTES TO THE FINANCIAL STATEMENTS
Deferred tax assets and liabilities are offset only where there
is a legally enforceable right to offset current tax assets
against current tax liabilities and deferred tax assets against
deferred tax liabilities; and they relate to the same taxable
authority on either the same taxable entity or different taxable
entities which intend to settle simultaneously.
(iii)
Tax Consolidation
The Group and its wholly-owned Australian controlled entities
have implemented the tax consolidation legislation as of 1
January 2006. Members of the tax consolidated group have
entered into a tax-funding agreement. Each entity is
responsible for remitting its share of the current tax payable
(receivable) assumed by the head entity.
AU Cyber Limited and its controlled entities are not part of the
5G Networks Limited tax consolidated group.
In accordance with UIG 1052 and Group accounting policy,
the Group has applied the ‘separate taxpayer within group
approach’, in which the head entity, 5G Networks Limited,
and the controlled entities in the tax consolidated group
continue to account for their own current and deferred
tax amounts.
In addition to its own current and deferred tax amounts, the
Group also recognises the current tax liabilities (or assets) and
the deferred tax assets arising from unused tax credits
assumed from controlled entities in the tax consolidated
group. The allocation of taxes to the head entity is recognised
as an increase/decrease in the controlled entity’s
inter-company accounts with the tax consolidated Group
head entity.
Members of the Group have entered into a tax-sharing
agreement that provides for the allocation of income tax
liabilities between the entities should the head entity default
on its tax payment obligations. No amounts have been
recognised in the financial statements in respect of this
agreement, on the grounds that the possibility is remote.
REVENUE
Revenue is recognised either at a point in time or over time
when (or as) the Group satisfies performance obligations by
transferring the promised goods or services to its customers.
All revenue is stated net of the amount of Goods and Services
Tax (GST).
(i)
Hardware and software sales
Sale of hardware and software products for a fixed fee is
recognised as revenue when the goods are delivered and
control is transferred to the customer.
(ii)
Rendering of Services – network and voice, data
centre, managed services, cyber services
The Group provides network, voice, data centre and managed
services under fixed-price and variable price contracts.
Revenue from providing services is recognised in the
accounting period in which the services are rendered.
For fixed-price contracts, revenue is recognised over time
based on the actual service provided to the end of the
reporting period as a proportion of the total services to be
provided because the customer receives and uses the
benefits simultaneously. In the case of fixed-price contracts,
the customer pays the fixed amount based on a payment
schedule. If the services rendered by the Group exceed the
payment, a contract asset is recognised. If the payments
exceed the services rendered, a contract liability is
recognised. If the contract includes a variable fee, revenue is
estimated at the amount the Group expects to receive.
Customers are invoiced on a monthly basis and consideration
is payable when invoiced.
(iii)
Rendering of Services –digital marketing
Online marketing revenue consists of search engine
optimisation (SEO), pay-per-click (PPC) advertising, and
social media advertising. Where consideration is received in
advance of performance, it is initially recorded as income
received in advance. Revenue is recognised as the
performance obligations are satisfied, which is considered to
be evenly over time in line with the contracted term as the
customer simultaneously receives and consumes the benefits
of online marketing services.
Contract fulfilment costs incurred in advance of revenue
recognition are capitalised when they are directly attributable
to the contract, generate the resources to satisfy the
performance obligations, and will be recovered. These costs
are expensed over the period when revenue is recognised.
OTHER INCOME
Other income includes miscellaneous items including expense
recoveries. Other income is recognised when it is received or
when the right to receive payment is established.
(i)
Interest
Interest revenue is recognised as interest accrues under the
effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest
income over the relevant period using the effective interest
rate, which is the rate that exactly discounts estimated future
cash receipts through the expected life of the financial asset
to the net carrying amount of the financial asset.
(ii)
Dividend
Dividend is defined as distributions of profits to holders of
equity investments in proportion to their holdings of a
particular class of capital and it is recognised as dividend
income on the basis when the shareholder’s right to receive
payment is established.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
49
NOTES TO THE FINANCIAL STATEMENTS
(iii)
Sale of other assets
The sale of other assets is recognised at the time the
sale is completed, consideration is transferred and control
has passed.
LEASES
(i)
The Group as a lessee
As a lessee, the Group considers whether a contract is, or
contains a lease. A lease is defined as ‘a contract, or part of a
contract that coveys the right to use as asset (the underlying
asset) for a period of time in exchange for consideration’.
Measurement and recognition of leases as a lessee
At the commencement date, the Group recognises a right- of-
use asset and a lease liability on the balance sheet. The right-
of-use asset is measured at cost, which is made up of the
initial measurement of the lease liability, any initial direct costs
incurred by the Group, an estimate of any costs to dismantle
and remove the asset at the end of the lease, and any lease
payments made in advance of the lease commencement date
(net of any incentives received).
The Group depreciates the right-of-use assets on a straight-
line basis from the lease commencement date to the earlier of
the end of the useful life of the right-of-use asset or the end of
the lease term.
At the commencement date, the Group measures the lease
liability at the present value of the lease payments unpaid at
that date, discounted lease payments using its incremental
borrowing rate. The weighted-average rate applied is in the
range of 6%-8%.
Lease payments included in the measurement of the lease
liability are made up of fixed payments (including in substance
fixed), and variable payments based on an index or rate
stated in the lease agreements.
Subsequent to initial measurement, the liability will be
reduced for payments made and increased for interest. It is
remeasured to reflect any reassessment or modification, or if
there are changes in in-substance fixed payments.
When the lease liability is remeasured, the corresponding
adjustment is reflected in the right-of-use asset, or profit and
loss if the right-of-use asset is already reduced to zero.
The Group has elected to account for short-term leases and
leases of low-value assets using the practical expedients.
Instead of recognising a right-of-use asset and lease liability,
the payments in relation to these are recognised as an
expense in profit or loss on a straight-line basis over the
lease term.
(ii)
The Group as a lessor
The Group accounts for a head lease and sublease as two
separate contracts, applying both lessee and lessor
accounting requirements respectively.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents includes cash on hand, deposits
held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or
less that are readily convertible to known amounts of cash
and which are subject to an insignificant risk of changes in
value. For the statement of cash flows presentation purposes,
cash and cash equivalents also includes bank overdrafts,
which are shown within borrowings of current liabilities on the
statement of financial position.
INVENTORIES
Inventories are stated at the lower of cost and net realisable
value. Cost includes all expenses directly attributable to the
manufacturing process as well as suitable portions of related
production overheads, based on normal operating capacity.
Costs of ordinarily interchangeable items are assigned using
the first in, first out cost formula. Net realisable value is the
estimated selling price in the ordinary course of business less
any applicable selling expenses.
PROPERTY, PLANT AND EQUIPMENT
Plant and equipment is stated at historical cost less
accumulated depreciation and impairment. Historical cost
includes expenditure that is directly attributable to the
acquisition of the items.
Depreciation is provided on a straight-line basis on all plant
and equipment. Major depreciation periods are:
Leasehold improvements
Lease term or 6 years if the
lease term is over 6 years
Plant and Equipment
2 to 10 years
Furniture and fittings
2 to 5 years
The residual values, useful lives and depreciation methods are
reviewed, and adjusted if appropriate, at each reporting date.
Leasehold improvements and plant and equipment under
lease are depreciated over the unexpired period of the
lease or the estimated useful life of the assets, whichever
is shorter.
An item of property, plant and equipment is derecognised
upon disposal or when there is no future economic benefit
to the Group. Gains and losses between the carrying
amount and the disposal proceeds are taken to profit
or loss.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
50
NOTES TO THE FINANCIAL STATEMENTS
INTANGIBLE ASSETS
(i)
Goodwill
Goodwill arises on the acquisition of a business combination.
Goodwill is calculated as the excess sum of:
•
the consideration transferred;
•
any non-controlling interest; and
•
the acquisition date fair value of any previously held
equity interest; over the acquisition date fair value of net
identifiable assets acquired.
Goodwill is not amortised. Instead, goodwill is tested annually
for impairment, or more frequently if events or changes in
circumstances indicate that it might be impaired, and is
carried at cost less accumulated impairment losses.
Impairment losses on goodwill are taken to profit or loss and
are not subsequently reversed.
Goodwill is allocated to the Group’s cash-generating units
representing the lowest level at which goodwill is monitored.
(ii)
Brand name and customer contracts
Brand names and customer contracts acquired in a business
combination that qualify for separate recognition are
recognised as intangible assets at their fair values.
Brand names and customer contracts are amortised on a
straight-line basis over their estimated useful lives of five to
ten years.
(iii)
Capitalised Software
Costs relating to the research phase of the project are
expensed while costs relating to the development phase are
capitalised as Capitalised Software when the project meets
the definition of an asset; and is identifiable. The costs
capitalised are being amortised over a useful life of four to
six years.
IMPAIRMENT OF NON-FINANCIAL ASSETS
Goodwill and other intangible assets that have an indefinite
useful life are not subject to amortisation and are tested
annually for impairment, or more frequently if events or
changes in circumstances indicate that they might be
impaired. Other non-financial assets are reviewed for
impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable. An
impairment loss is recognised for the amount by which the
asset’s carrying amount exceeds its recoverable amount.
Recoverable amount is the higher of an asset’s fair value less
costs of disposal and value-in-use. The value-in-use is the
present value of the estimated future cash flows relating to
the asset using a pre-tax discount rate specific to the asset or
cash-generating unit to which the asset belongs. Assets that
do not have independent cash flows are grouped together to
form a cash-generating unit.
FINANCIAL INSTRUMENTS
(i)
Recognition and derecognition
Financial assets and financial liabilities are recognised when
the Group becomes a party to the contractual provisions of
the financial instrument, and are measured initially at fair value
adjusted by transactions costs, except for those carried at fair
value through profit or loss, which are measured initially at fair
value. Subsequent measurement of financial assets and
financial liabilities are described below.
Financial assets are derecognised when the contractual rights
to the cash flows from the financial asset expire, or when the
financial asset and all substantial risks and rewards are
transferred. A financial liability is derecognised when it is
extinguished, discharged, cancelled or expires.
(ii)
Classification and measurement of financial assets
Except for those trade receivables that do not contain a
significant financing component and are measured at the
transaction price in accordance with AASB 15, all financial
assets are initially measured at fair value adjusted for
transaction costs (where applicable).
Financial assets are classified into one of the following
categories:
•
amortised cost
•
fair value through profit or loss (FVTPL), or
•
fair value through other comprehensive income (FVOCI).
Financial assets at amortised cost
All of the Group’s financial assets are classified as financial
assets at amortised cost as they meet the following
conditions:
•
they are held within a business model whose objective
is to hold the financial assets and collect its contractual
cash flows
•
the contractual terms of the financial assets give rise to
cash flows that are solely payments of principal and
interest on the principal amount outstanding
After initial recognition, these are measured at amortised cost
using the effective interest method. Discounting is omitted
where the effect of discounting is immaterial. The Group’s
cash and cash equivalents, restricted cash, trade and other
receivables fall into this category of financial assets.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
51
NOTES TO THE FINANCIAL STATEMENTS
Financial assets at fair value through profit or loss
(FVTPL)
Financial assets that are held within a different business
model other than ‘hold to collect’ or ‘hold to collect and sell’
are categorised at FVTPL. Further, irrespective of business
model financial assets whose contractual cash flows are
not solely payments of principal and interest are accounted
for at FVTPL. All derivative financial instruments fall into
this category.
The category also contains an equity investment. The Group
accounts for the investment at FVTPL and did not make the
irrevocable election to account for the investment in Tiger
Pistol and listed equity securities at fair value through other
comprehensive income (FVOCI). The fair value was
determined in line with the requirements of IFRS 9 ’Financial
Instruments’, which does not allow for measurement at cost.
Assets in this category are measured at fair value with gains
or losses recognised in profit or loss. The fair values of
financial assets in this category are determined by reference
to active market transactions or using a valuation technique
where no active market exists.
Financial assets designated at fair value through OCI
FVOCI)
Upon initial recognition, the Group can elect to classify
irrevocably its equity investments as equity instruments
designated at fair value through OCI when they meet the
definition of equity under AASB 132: Financial Instruments:
Presentation and are not held for trading. The classification is
determined on an instrument-by-instrument basis. Gains and
losses on these financial assets are never recycled to profit or
loss. Dividends are recognised as other income in the
statement of comprehensive income when the right of
payment has been established, except when the Group
benefits from such proceeds as a recovery of part of the cost
of the financial asset, in which case such gains are recorded
in OCI. Equity instruments designated at fair value through
OCI are not subject to impairment assessment.
The Group elected to classify irrevocably its Other non-listed
equity investments under this category.
(i)
Impairment of Financial assets
The Group assesses on a forward-looking basis the expected
credit losses associated with other receivables carried at
amortised cost. The impairment methodology applied
depends on whether there has been a significant increase in
credit risk.
The Group makes use of a simplified approach in accounting
for trade receivables as well as contract assets and records
the loss allowance as lifetime expected credit losses.
These are the expected shortfalls in contractual cash flows,
considering the potential for default at any point during the life
of the financial instrument. In calculating, the Group uses its
historical experience, external indicators and forward-looking
information to calculate the expected credit losses using a
provision matrix.
The Group assess impairment of trade receivables on a
collective basis as they possess shared credit risk
characteristics they have been grouped based on the days
past due. Refer to Note 10 for a detailed analysis of how the
impairment requirements of AASB 9 are applied.
(ii)
Classification and measurement of financial
liabilities
The Group’s financial liabilities include trade and other
payables, loans and borrowings, derivative financial
instruments and contingent consideration.
Financial liabilities are initially measured at fair value, and,
where applicable, adjusted for transaction costs unless the
Group designated a financial liability at fair value through
profit or loss.
Subsequently, financial liabilities that are measured at
amortised cost are measured using the effective interest
method, which are carried subsequently at fair value with
gains or losses recognised in profit or loss.
All interest-related charges and, if applicable, changes in an
instrument’s fair value that are reported in profit or loss are
included within finance costs or finance income.
PROVISIONS, CONTINGENT ASSETS AND
CONTINGENT LIABILITIES
Provisions are recognised when the Group has a present
(legal or constructive) obligation as a result of a past event, it
is probable the Group will be required to settle the obligation,
and a reliable estimate can be made of the amount of the
obligation. The amount recognised as a provision is the best
estimate of the consideration required to settle the present
obligation at the reporting date, taking into account the risks
and uncertainties surrounding the obligation. If the time value
of money is material, provisions are discounted using a
current pre-tax rate specific to the liability. The increase in the
provision resulting from the passage of time is recognised as
a finance cost.
Any reimbursement that the Group is virtually certain to
collect from a third party with respect to the obligation is
recognised as a separate asset. However, this asset may not
exceed the amount of the related provision.
No liability is recognised if an outflow of economic resources
as a result of present obligations is not probable. Such
situations are disclosed as contingent liabilities unless the
outflow of resources is remote.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
52
NOTES TO THE FINANCIAL STATEMENTS
EMPLOYEE BENEFITS
(i)
Wages and Salaries and Annual Leave
Liabilities for wages and salaries, including non-monetary
benefits, and annual leave expected to be settled within 12
months of the reporting date are recognised in current
liabilities in respect of employees’ services up to the reporting
date and are measured at the amounts expected to be paid
when the liabilities are settled.
(ii)
Long Service Leave
The liability for long service leave is recognised in current and
non-current liabilities, depending on the unconditional right to
defer settlement of the liability for at least 12 months after the
reporting date. The liability is measured as the present value
of expected future payments to be made in respect of
services provided by employees up to the reporting date
using the projected unit credit method. Consideration is given
to expected future wage and salary levels, experience of
employee departures and periods of service.
Expected future payments are discounted using market yields
at the reporting date on high quality Australian corporate
bonds with terms to maturity and currency that match, as
closely as possible, the estimated future cash outflows.
(iii)
Share-based payments
The Group operates equity-settled share-based remuneration
plans for its employees. None of the Group’s plans are cash-
settled.
All goods and services received in exchange for the grant of
any share-based payment are measured at their fair values.
Where employees are rewarded using share-based payments,
the fair value of employees’ services is determined indirectly
by reference to the fair value of the equity instruments
granted. This fair value is appraised at the grant date and
excludes the impact of non-market vesting conditions (for
example profitability and sales growth targets and
performance conditions).
All share-based remuneration is ultimately recognised as an
expense in profit or loss with a corresponding credit to the
share-based payment reserve. If vesting periods or other
vesting conditions apply, the expense is allocated over the
vesting period, based on the best available estimate of the
number of share options expected to vest.
Non-market vesting conditions are included in assumptions
about the number of options that are expected to become
exercisable. Estimates are subsequently revised if there is any
indication that the number of share options expected to vest
differs from previous estimates. Any adjustment to cumulative
share-based compensation resulting from a revision is
recognised in the current period.
The number of vested options ultimately exercised by holders
does not impact the expense recorded in any period.
Upon exercise of share options, the proceeds received, net of
any directly attributable transaction costs, are allocated to
share capital.
ISSUED CAPITAL
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.
DIVIDENDS
Dividends are recognised when declared during the financial
year.
EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the profit
attributable to the owners of the Group, by the weighted
average number of ordinary shares outstanding during the
financial year.
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account
the after income tax effect of interest and other financing
costs associated with dilutive potential ordinary shares and
the weighted average number of shares assumed to have
been issued for no consideration in relation to dilutive
potential ordinary shares.
GOODS AND SERVICES TAX (‘GST’) AND OTHER
SIMILAR TAXES
Revenues, expenses and assets are recognised net of the
amount of associated GST, unless the GST incurred is not
recoverable from the tax authority. In this case it is recognised
as part of the cost of the acquisition of the asset or as part of
the expense.
Receivables and payables are stated inclusive of the amount
of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the tax authority is included
in other receivables or other payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST
components of cash flows arising from investing or financing
activities which are recoverable from, or payable to the tax
authority, are presented as operating cash flows.
Commitments and contingencies are disclosed net of the
amount of GST recoverable from, or payable to, the tax
authority.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
53
NOTES TO THE FINANCIAL STATEMENTS
COMPARATIVE FIGURES
When required by Accounting Standards, comparative figures
have been adjusted to conform to changes in presentation for
the current financial year.
NON-CURRENT ASSETS (OR DISPOSAL GROUPS)
HELD FOR SALE AND DISCONTINUED OPERATIONS
Non-current assets (or disposal groups) are classified as held
for sale if their carrying amount will be recovered principally
through a sale transaction rather than through continuing use
and a sale is considered highly probable. They are measured
at the lower of their carrying amount and fair value less costs
to sell, except for assets such as deferred tax assets, assets
arising from employee benefits and financial assets.
An impairment loss is recognised for any initial or subsequent
write-down of the asset (or disposal group) to fair value less
costs to sell. A gain is recognised for any subsequent
increases in fair value less costs to sell of an asset (or
disposal group), but not in excess of any cumulative
impairment loss previously recognised. A gain or loss not
previously recognised by the date of the sale of the non-
current asset (or disposal group) is recognised at the date of
derecognition.
Non-current assets (including those that are part of a disposal
group) are not depreciated or amortised while they are
classified as held for sale. Interest and other expenses
attributable to the liabilities of a disposal group classified as
held for sale continue to be recognised. Non-current assets
classified as held for sale and the assets of a disposal group
classified as held for sale are presented separately from the
other assets in the statement of financial position. The
liabilities of a disposal group classified as held for sale are
presented separately from other liabilities in the statement of
financial position.
3.
CRITICAL ACCOUNTING JUDGEMENTS,
ESTIMATES AND ASSUMPTIONS
The preparation of the financial statements requires
management to make judgements, estimates and
assumptions that affect the reported amounts in the financial
statements. Management continually evaluates its
judgements and estimates in relation to assets, liabilities,
contingent liabilities, revenue and expenses. Management
bases its judgements, estimates and assumptions on
historical experience and on other various factors, including
expectations of future events, management believes to be
reasonable under the circumstances and with the exception
of income tax, was the same as those applied in the Group’s
last annual financial statements for the year ended 30 June
2024. The resulting accounting judgements and estimates will
seldom equal the related actual results. The judgements,
estimates and assumptions that have a significant risk of
causing a material adjustment to the carrying amounts of
assets and liabilities within the next financial year are
discussed below.
PROVISION FOR IMPAIRMENT OF RECEIVABLES
The provision for impairment of receivables assessment
requires a degree of estimation and judgement. The level of
provision is assessed by taking into account the recent sales
experience, the ageing of receivables, historical collection
rates and specific knowledge of the individual debtor’s
financial position.
ESTIMATION OF USEFUL LIVES OF ASSETS
The Group determines the estimated useful lives and related
depreciation and amortisation charges for its property, plant
and equipment and finite life intangible assets. The useful
lives could change significantly as a result of technical
innovations or some other event. The depreciation and
amortisation charge will increase where the useful lives are
less than previously estimated lives, or technically obsolete or
non-strategic assets that have been abandoned or sold will
be written off or written down.
GOODWILL AND OTHER INDEFINITE LIFE
INTANGIBLE ASSETS
The Group tests annually, or more frequently if events or
changes in circumstances indicate impairment, whether
goodwill and other indefinite life intangible assets have
suffered any impairment, in accordance with the accounting
policy stated in Note 2.
IMPAIRMENT OF NON-FINANCIAL ASSETS OTHER
THAN GOODWILL AND OTHER INDEFINITE LIFE
INTANGIBLE ASSETS
The Group assesses impairment of non-financial assets other
than goodwill and other indefinite life intangible assets at each
reporting date by evaluating conditions specific to the Group
and to the particular asset that may lead to impairment. If an
impairment trigger exists, the recoverable amount of the asset
is determined. This involves fair value less costs of disposal or
value-in-use calculations, which incorporate a number of key
estimates and assumptions.
LEASES
The Group determines the lease term as the non-cancellable
term of the lease, together with any periods covered by an
option to extend the lease if it is reasonably certain to be
exercised, or any periods covered by an option to terminate
the lease, if it is reasonably certain not to be exercised.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
54
NOTES TO THE FINANCIAL STATEMENTS
The Group has the option, under some of its premises leases
to lease the assets for additional terms of five years. The
Group applies judgement in evaluating whether it is
reasonably certain to exercise the option to renew. That is, it
considers all relevant factors that create an economic
incentive for it to exercise the renewal. The Group reassesses
the lease term if there is a significant event or change in
circumstances that is within its control and affects its ability to
exercise (or not to exercise) the option to renew (e.g., a
change in business strategy). The Group excluded the
renewal period as part of the lease term for leases of rental
premises as the Group is not reasonably certain to exercise
the renewals.
INCOME TAX
The Group is subject to income taxes in the jurisdictions in
which it operates. Significant judgement is required in
determining the provision for income tax. There are many
transactions and calculations undertaken during the ordinary
course of business for which the ultimate tax determination is
uncertain. The Group recognises liabilities based on the
Group’s current understanding of the tax law. Where the final
tax outcome of these matters is different from the carrying
amounts, such differences will impact the current and
deferred tax provisions in the period in which such
determination is made. The deductibility of prior and current
period tax losses is uncertain as the Group is continuing to
assess its ability to recoup current and prior year capital
losses. Refer to note 8 Uncertain tax position.
RECOVERY OF DEFERRED TAX ASSETS
Deferred tax assets are recognised for deductible temporary
differences only if the Group considers it is probable that
future taxable amounts will be available to utilise those
temporary differences and losses.
LONG SERVICE LEAVE PROVISION
The liability for long service leave is recognised and measured
at the present value of the estimated future cash flows to be
made in respect of all employees at the reporting date. In
determining the present values of the liability, estimates of
attrition rates and pay increases through promotion and
inflation have been taken into account.
BUSINESS COMBINATIONS
Business combinations are initially accounted for on a
provisional basis. The fair value of assets acquired, liabilities
and contingent liabilities assumed are initially estimated by the
Group taking into consideration all available information at the
reporting date. Fair value adjustments on the finalisation of the
business combination accounting is retrospective, where
applicable, to the period the combination occurred and may
have an impact on the assets and liabilities, depreciation and
amortisation reported.
4.
SEGMENT INFORMATION
From 1 July 2024, Management has identified the operating
segments monitored by the Group’s Chief Operating Decision
Maker (“CODM”) as being Enterprise and Wholesale:
-
Enterprise: cloud hosting, data centre, networks and
voice, IT managed services, hardware and software and
services provided to Enterprise and Government
customers.
-
Wholesale: cloud hosting, data centre, networks and
voice products and services provided to wholesale
telecommunications.
Segment information is provided below in relation to these
segments.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
55
NOTES TO THE FINANCIAL STATEMENTS
Segment information for continuing operations for the reporting period is as follows:
2025
Enterprise
$’000
Wholesale
$’000
Total
$’000
Segment revenue
42,310
20,324
62,634
Network and data centre costs
(15,799)
(16,873)
(32,672)
Gross margin
26,511
3,451
29,962
Other income
3,688
-
3,688
Rent and office expenses
(1,304)
-
(1,304)
Marketing and travel expenses
(562)
(52)
(614)
Employee benefits expenses
(24,034)
-
(24,034)
Other expenses
(4,456)
-
(4,456)
Total Adjusted EBITDA
(157)
3,399
3,242
Depreciation and amortisation expenses
(5,426)
(1,699)
(7,125)
Finance costs
(1,169)
-
(1,169)
Impairment of goodwill
(7,629)
-
(7,629)
Share-based payment expenses
(1,829)
-
(1,829)
Non-recurring costs
(2,479)
-
(2,479)
Net gain/(loss) on FV of financial instruments
435
-
435
Loss on remeasurement of assets held for sale
(2,410)
(929)
(3,339)
Loss before income tax expense
(20,664)
771
(19,893)
Total Segment assets
51,016
24,505
75,521
Total Segment liabilities
21,067
10,120
31,187
1.
Comparative figures for 2024 have been reclassified to conform with the current year’s presentation of segment information
The segment information is presented on the same basis as the internal reports provided to the Group’s Chief Operating Decision Maker ("CODM"). The CODM
evaluates performance primarily on EBITDA. Other subtotals (including ‘gross margin’) are presented consistent with internal reporting and are not measures
defined by IFRS; accordingly, they may differ from subtotals presented in the consolidated financial statements.
20241
Enterprise
$’000
Wholesale
$’000
Total
$’000
Segment revenue
32,468
16,868
49,336
Network and data centre costs
(14,055)
(14,174)
(28,229)
Gross margin
19,289
1,818
21,107
Other income
3,536
-
3,536
Rent and office expenses
(317)
(164)
(481)
Marketing and travel expenses
(474)
(247)
(721)
Employee benefits expenses
(20,846)
(587)
(21,433)
Other expenses
(2,988)
(1,552)
(4,540)
Total Adjusted EBITDA
(2,676)
144
(2,532)
Impairment of goodwill
(6,911)
-
(6,911)
Loss on sale of investments
(157)
-
(157)
Share-based payment expenses
(1,885)
(1,885)
Non-recurring costs
(8,315)
-
(8,315)
Depreciation and amortisation expenses
(5,034)
(2,616)
(7,650)
Finance costs
(2,643)
-
(2,643)
Loss before income tax expense
(27,621)
(2,472)
(30,093)
Total Segment assets
66,950
34,782
101,732
Total Segment liabilities
32,331
16,796
49,127
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
56
NOTES TO THE FINANCIAL STATEMENTS
(a) Adjusted EBITDA
Adjusted EBITDA excludes discontinued operations and the effects of significant items of income and expenditure which may have
an impact on the quality of earnings such as restructuring costs, legal expenses and impairments where the impairment is the result
of an isolated, non- recurring event. It also excludes the effects of equity- settled share-based payments and unrealised gains or
losses on financial instruments.
(b) Gross Margin
Gross margin is calculated as segment revenue less network and data centre costs. It represents the contribution after direct third-
party network and infrastructure costs, consistent with the internal reporting reviewed by the CODM. Gross margin does not reflect
fully absorbed cost of sales, and excludes directly attributable employee benefits, depreciation or amortisation of network and data
centre assets, and other indirect costs, which are reported separately below gross margin. Accordingly, the measure differs from
gross profit as it would be presented in the consolidated financial statements under IFRS.
Interest income and finance cost are not allocated to segments, as this type of activity is driven by the central treasury function,
which manages the cash position of the group.
5.
REVENUE FROM CONTRACTS WITH CUSTOMERS
The revenue breakdown by product and service line for the year ended 30 June 2025 is shown below:
2025
$’000
2024
$’000
CONTINUING OPERATIONS
Types of goods or service
Cloud
10,392
7,827
Network & Voice
7,285
7,624
Data Centres
13,039
9,239
Managed Services
18,825
14,808
Digital Marketing
-
2,570
Cyber
3,552
-
Hardware & Software
9,541
7,268
Total Revenue from Contracts with Customers
62,634
49,336
Timing of revenue recognition
Goods and services transferred at a point in time
9,541
7,268
Services transferred over time
53,093
42,068
Total Revenue from Contracts with Customers
62,634
49,336
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
57
NOTES TO THE FINANCIAL STATEMENTS
The Group’s revenue disaggregated by pattern of revenue recognition is as follows:
For the year ended 30 June 2025
Cloud
Network &
Voice
Data
Centres
Managed
Services
Digital
Marketing
Hardware &
Software
Cyber
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Goods transferred at a
point in time
-
-
-
-
-
9,541
-
9,541
Service transferred
over time
10,392
7,285
13,039
18,825
-
-
3,552
53,093
For the year ended 30 June 2024
Cloud
Network &
Voice
Data
Centres
Managed
Services
Digital
Marketing
Hardware &
Software
Cyber
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Goods transferred at a
point in time
-
-
-
-
-
7,268
-
7,268
Service transferred
over time
7,827
7,624
9,239
14,808
2,570
-
-
42,068
6.
OTHER INCOME
Other income includes miscellaneous items including expense recoveries. Other revenue is recognised when it is received or when
the right to receive payment is established.
Consolidated
2025
$000
2024
$000
Sale of network assets
-
1,637
Profit on sale of business
3
329
Dividend income
442
27
Interest income
1,997
1,399
Sundry income
959
144
R&D Refundable tax offset
287
-
Total Other Income
3,688
3,536
7.
EARNINGS PER SHARE
Basic Earnings Per Share (EPS) amounts are calculated by dividing net profit or loss for the year attributable to ordinary equity
holders of the parent by the weighted average number of ordinary shares outstanding during the period. Diluted EPS amounts are
calculated by dividing net profit attributable to ordinary equity holders of the parent by the weighted average number of ordinary
shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on the conversion of
all the dilutive potential ordinary shares into ordinary shares. There were no dilutive potential ordinary shares in existence during the
year (2024: Nil) as the share options and performance rights of the Company were antidilutive. The following represents the share
data used in the EPS computations:
Consolidated 2025
Number
Consolidated 2024
Number
Weighted average number of shares used in calculating earnings per share
and diluted earnings per share
297,841,762
317,757,331
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
58
NOTES TO THE FINANCIAL STATEMENTS
8.
INCOME TAX
Consolidated
2025
$000
2024
$000
(A) INCOME TAX BENEFIT / (EXPENSE)
Loss from continuing operations before income tax expense
(19,959)
(30,093)
Profit from discontinued operation before income tax expense
-
98,324
Profit/(Loss) before income tax expense
(19,959)
68,231
Tax at the Group’s statutory income tax rate of 30% (2023: 30%)
5,987
(20,469)
Accounting and tax difference on sale of businesses
-
6,066
Other tax-exempt income
73
-
Non-deductible goodwill impairment charge
(2,289)
(2,073)
Expense on performance rights and options
(549)
(641)
Other non-deductible expenses
(100)
(113)
Net under/over
(157)
(1,176)
Movement in temporary differences relating to sale entities
-
160
Derecognition of DTA
10,063
(3,815)
Unrecognised tax loss for the year
(3,271)
-
Utilisation of tax losses
-
3,246
Actual tax benefit / (expense)
9,757
(18,815)
Tax expense comprises:
- Current tax
(306)
(14,352)
- Resolution of uncertain tax position
10,063
-
- Deferred tax – origination and reversal of temporary differences
-
(4,463)
Aggregate Income tax (expense) / benefit
9,757
(18,815)
Tax (Expense) / Benefit reported in the Statement of Comprehensive Income:
- From continuing operations
9,757
2,085
- From discontinued operation
-
(20,900)
Aggregate Income tax (expense) / benefit
9,757
(18,815)
(B) DEFERRED TAX ASSETS AND LIABILITIES
Deferred tax assets and liabilities are comprised of the following temporary differences:
Allowable section 40-880 deductions
552
541
Accrued expenses and provisions
1,782
1,860
Plant & equipment and leased assets
684
994
Lease liability
2,663
3,391
Tangible and intangible assets
(1,089)
(1,777)
ACA impact on depreciating assets
(40)
(71)
Brand and Customer contract
(746)
(973)
Accrued income
(189)
(150)
Brand and Customer contract - AUCyber
(473)
-
NET DEFERRED TAX ASSET / (DEFERRED TAX LIABILITY)
3,144
3,815
Derecognition of Deferred Tax Asset
(3,617)
(3,815)
DEFERRED TAX ASSET (DEFERRED TAX LIABILITY)
(473)
-
As at 30 June 2025, the Group has unrecognised income tax losses of $43,409,613 tax-effected at 30% (2024: $36,693,265), and capital losses of
$90,346,341 arising from the sale of businesses in previous financial years (2024: $90,346,341). The Group also has $4,187,390 of unrecognised income
tax losses tax effected at 30% (2024: $0) relating to the AUCyber tax group. AUCyber is not part of the 5G Networks tax consolidated group .
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
59
NOTES TO THE FINANCIAL STATEMENTS
9.
CASH AND CASH EQUIVALENTS AND
RESTRICTED CASH
(A)
RECONCILIATION OF CASH AND CASH
EQUIVALENTS
For the purposes of the statement of cash flows, cash
includes cash at bank and on hand net of bank overdrafts.
Cash at the end of the year as shown in the statement of cash
flows is reconciled to the related items in the statement of
financial position as follows:
Consolidated
2025
$000
2024
$000
Cash at bank and on hand
25,914
64,986
Restricted cash
3,315
2,925
Total Cash & Cash Equivalents
29,229
67,911
Consolidated
2025
$000
2023
$000
Cash at bank and on hand including
cash classified within current assets as
held for sale
25,914
68,322
Less: Transfer to assets reclassified
from held for sale
-
(3,336)
Cash and cash equivalents
25,914
64,986
Restricted cash
3,315
2,925
TOTAL CASH AND CASH
EQUIVALENTS AND RESTRICTED
CASH
29,229
67,911
(B)
RECONCILIATION OF LOSS AFTER TAX TO NET
CASH FLOWS FROM OPERATING ACTIVITIES
Consolidated
2025
$000
2024
$000
Loss after income tax
(10,136)
49,416
Non-operating cash flows in profit:
Profit on sale of businesses and
investments
-
(77,267)
Depreciation and amortisation
7,125
7,650
Share-based payment expenses
1,829
1,885
Impairment expenses
7,629
6,911
Income tax benefit
(9,757)
(2,085)
Deferred tax movement
-
(4,463)
Other non-cash expenses / (income)
5,989
1,435
Changes in assets and liabilities net of effects of purchases
and disposals of controlled entities:
Movement in trade and other
receivables
(8,343)
796
Movement in other assets
(1,831)
(3,671)
Movement in deferred tax asset
-
5,436
Movement in trade and other payables
(5,493)
(1,155)
Movement in employee benefits
provisions
280
(630)
Movement in Income tax payable
(4,289)
(124)
Movement in other liabilities
3,641
1,396
NET CASH FROM OPERATING
ACTIVITIES
(13,362)
(14,470)
Restricted cash
The restricted cash amounts of $3.315 million (2024: $2.925
million) are held as security for property lease bank
guarantees issued by Commonwealth Bank of Australia on
behalf of the Group.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
60
NOTES TO THE FINANCIAL STATEMENTS
10. TRADE AND OTHER RECEIVABLES
Consolidated
2025
$000
2024
$000
Trade receivables
7,729
-
Allowance for impairment of
receivables
(184)
-
7,545
-
Unsecured loans – at call1
378
378
Other receivables
942
144
Total Trade and Other Receivables
8,865
522
1.
Unsecured loans represent loans granted to key management
personnel and employees to allow them to take up shares in a capital
raising undertaken by 5G Networks Limited in FY21.
The Group applies the AASB 9 simplified model of
recognising lifetime expected credit losses for all trade
receivables as these items do not have a significant
financing component.
In measuring the expected credit losses, the trade receivables
have been assessed on a collective basis as they possess
shared credit risk characteristics. They have been grouped
based on the days past due and also according to the
geographical location of customers.
The expected loss rates are based on the payment profile for
sales over the past 36 months before 30 June 2025 and 1 July
2024 respectively as well as the corresponding historical
credit losses during that period. The historical rates are
adjusted to reflect current and forwarding looking
macroeconomic factors affecting the customer’s ability to
settle the amount outstanding.
Trade receivables are written off (i.e. derecognised) when
there is no reasonable expectation of recovery. Failure to
make payments within 120 days from the invoice date and
failure to engage with the Group on alternative payment
arrangement amongst other is considered indicators of no
reasonable expectation of recovery.
On the above basis the expected credit loss for trade receivables as at 30 June 2025 and 30 June 2024 was determined as follows:
2025
2024
ECL
Rate
Gross
$’000
ECL
$’000
ECL
Rate
Gross
$’000
ECL
$’000
Current
0.0%
5,335
-
-
-
-
1-30 days past due
0.28%
1,365
(4)
-
-
-
31-60 days past due
8.29%
723
(60)
-
-
-
61-90 days past due
19.53%
80
(16)
-
-
-
91 days + past due
46.40%
226
(104)
-
-
-
CLOSING BALANCE
7,729
(184)
-
-
-
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
61
NOTES TO THE FINANCIAL STATEMENTS
The closing balance of the trade receivables loss allowance as
at 30 June 2025 reconciles with the trade receivables loss
allowance opening balance as follows:
$000
Opening loss allowance as at 1 July 2023
238
Reduction in loss allowance
(89)
Transfer to assets reclassified as held for sale
(149)
Loss allowance as at 30 June 2024
-
Increase in loss allowance
184
Loss allowance as at 30 June 2025
184
In respect of trade and other receivables, the Group is not
exposed to any significant credit risk exposure to any single
counterparty or any group of counterparties having similar
characteristics. Trade receivables consist of a large number of
customers in various industries and geographical areas.
Based on historical information about customer default rates
management consider the credit quality of trade receivables
that are not past due or impaired to be good.
11. CONTRACT ASSETS AND LIABILITIES
Contract assets consist of the following:
Consolidated
2025
$000
2024
$000
Contract assets1
Work in progress
975
-
975
-
Movement of contract assets during the period:
Consolidated
2025
$000
2024
$000
As at 1 July 2024
-
1,089
Additions
2,899
1,946
Cash received
(1,924)
(2,275)
Assets reclassified from held for
sale
-
(760)
As at 30 June 2025
975
-
1.
The Group makes uses of a simplified approach in accounting for contract
assets and records the loss allowance as lifetime expected credit losses.
After the assessment of contract asset on a collective basis, the Group
determined to apply zero as the loss rate.
Contract liabilities consist of the following:
Consolidated
2025
$000
2024
$000
Deferred revenue
304
-
Contract liabilities - current
304
-
Deferred revenue
-
-
Contract liabilities - non-current
-
-
Movement of contract liabilities during the period:
Consolidated
2025
$000
2024
$000
Balance as at 1 July 2024
-
25,440
Add: customer payments received
304
32,527
Less: revenue released to P&L
-
(31,131)
Less: Sale of business
-
(26,397)
Reclassification from non-current
liabilities
-
-
Assets reclassified from held for sale
-
(439)
Contract liabilities (current)
304
-
Balance as at 1 July 2023
-
9,698
Reclassification to current liabilities
-
-
Net customer payments received
-
-
Less: Sale of business
-
(9,698)
Contract liabilities (non-current)
-
-
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
62
NOTES TO THE FINANCIAL STATEMENTS
12. PROPERTY, PLANT AND EQUIPMENT
Leasehold
Improvements
Plant and
Equipment
Total
$000
$000
$000
Gross carrying amount
At 1 July 2024
-
-
-
Assets acquired in the business acquisition
219
5,349
5,568
Additions
7
3,981
3,988
Disposals
-
(3)
(3)
Assets reclassified from held for sale
255
10,242
10,497
Closing value at 30 June 2025
481
19,569
20,050
Depreciation and impairment
At 1 July 2024
-
-
-
Depreciation
(114)
(1,691)
(1,805)
Net loss on transfer of assets held for sale
-
(3,094)
(3,094)
Disposals
-
-
-
Closing value at 30 June 2025
(114)
(4,785)
(4,899)
CARRYING AMOUNT AT 30 JUNE 2025
367
14,784
15,151
Gross carrying amount
At 1 July 2023
4,410
30,994
35,404
Additions
-
4,381
4,381
Disposals
(46)
(123)
(169)
Assets reclassified as held for sale
(4,364)
(35,252)
(39,616)
Closing value at 30 June 2024
-
-
-
Depreciation and impairment
At 1 July 2023
(3,864)
(21,735)
(25,599)
Depreciation
(291)
(3,337)
(3,628)
Disposals
46
62
108
Closing value at 30 June 2024
(4,109)
(25,010)
(29,119)
CARRYING AMOUNT AT 30 JUNE 2024
-
-
-
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
63
NOTES TO THE FINANCIAL STATEMENTS
13. LEASES
The Group has leases for data centres and related facilities, and offices premises. With the exception of short-term leases and
leases of low-value underlying assets, each lease is reflected on the balance sheet as a right-of-use asset and a lease liability.
Variable lease payments which do not depend on an index or a rate (such as lease payments based on a percentage of Group
sales) are excluded from the initial measurement of the lease liability and asset.
Set out below are the amounts recognised in profit and loss during the period:
Consolidated
2025
$000
2024
$000
Depreciation expense of right-of-use assets
3,818
2,622
Net Loss on transfer of assets held for sale
942
-
Interest expense on lease liabilities
825
1,062
Rent expense - short-term leases
336
119
Right-of-use asset
Building
$000
IT Equipment
$000
Total
$000
As at 1 July 2024
-
-
-
Additions during the year
853
-
853
Assets acquired in the business acquisition
4,239
-
4,239
Disposals during the year
-
-
-
Depreciation expense
(3,798)
(20)
(3,818)
Assets reclassified from held for sale
7,224
33
7,257
Net loss on transfer of assets held for sale
(929)
(13)
(942)
As at 30 June 2025
7,589
-
7,589
As at 1 July 2023
9,954
422
10,376
Additions during the year
1,844
-
1,844
Disposals during the year
(2,080)
-
(2,080)
Depreciation expense
(2,494)
(129)
(2,623)
Assets reclassified as held for sale
(7,224)
(293)
(7,517)
As at 30 June 2024
-
-
-
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
64
NOTES TO THE FINANCIAL STATEMENTS
Lease liabilities
Consolidated
2025
$000
2024
$000
Current
Obligations under property leases
5,323
-
Obligations under equipment leases
-
-
-
-
Non Current
Obligations under property leases
10,779
-
Obligations under equipment leases
-
-
10,779
-
Each lease generally imposes a restriction that, unless there is a contractual right for the Group to sublet the asset to another
party, the right-of-use asset can only be used by the Group. Leases are either non- cancellable or may only be cancelled by
incurring a substantive termination fee. Some leases contain an option to purchase the underlying leased asset outright at the
end of the lease, or to extend the lease for a further term. The Group is prohibited from selling or pledging the underlying
leased assets as security. For leases over data centres and office premises the Group must keep those properties in a good
state of repair and return the properties in their original condition at the end of the lease. Further, the Group must insure items of
property, plant and equipment and incur maintenance fees on such items in accordance with the lease contracts.
The table below describes the nature of the Group’s leasing activities by type of right-of-use asset recognised on balance sheet,
included within assets classified as held for sale:
Right-of-Use Asset
No. of right-of-
use assets
leased
Range of
remaining term
Average
remaining lease
term
No. of leases
with extension
options
No. of leases
with variable
payments linked
to an index
No. of leases
with termination
options
Data centres and
related facilities
5
0-6 years
3 years
4
4
0
Office premises
8
0-3 years
1 year
6
6
0
IT Equipment
2
1 year
1 year
0
0
0
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
65
NOTES TO THE FINANCIAL STATEMENTS
The lease liabilities that are included within liabilities directly related to assets classified as held for sale are secured by the
related underlying assets. Future minimum lease payments at 30 June 2025 were as follows:
Minimum Lease Payments Due
Within 1
year
1-2
years
2-3
years
3-4
years
4-5
years
After 5
years
Total
30 June 2025
Lease payments
3,958
2,028
1,337
540
540
225
8,628
Finance charges
(538)
(217)
(130)
(78)
(40)
(4)
(1,007)
Net present values
3,420
1,811
1,207
462
500
221
7,621
30 June 2024
Lease payments
4,070
3,925
2,875
3,639
585
720
15,814
Finance charges
(745)
(497)
(287)
(129)
(83)
(39)
(1,780)
Net present values
3,325
3,428
2,588
3,510
502
681
14,034
Lease payments not recognised as a liability
The group has elected not to recognise a lease liability for short term leases (leases with an expected term of 12 months or
less) or for leases of low value assets. Payments made under such leases are expensed on a straight-line basis. In addition,
certain variable lease payments are not permitted to be recognised as lease liabilities and are expensed as incurred.
The expense relating to payments not included in the measurement of the lease liability is as follows:
Consolidated
2025
$000
2024
$000
Short-term leases
336
119
Total
336
119
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
66
NOTES TO THE FINANCIAL STATEMENTS
14. GOODWILL
The following table shows the movements in goodwill:
Consolidated
2025
$000
2024
$000
Gross carrying amount
Balance at beginning of period
23,884
67,253
Acquired through business combination (refer note 19)
12,058
1,375
Disposed through sale of business
-
(44,744)
Balance at end of the period
35,942
23,884
Accumulated impairment
Balance at beginning of period
(23,884)
(16,973)
Impairment loss recognised
(7,629)
(6,911)
Balance at end of the period
(31,513)
(23,.884)
Carrying amount at end of the period
4,429
-
Impairment Disclosures and Testing of Goodwill
Goodwill is allocated to the Group’s cash generating units (CGU), which are the units expected to benefit from the synergies of
the business combinations in which the goodwill arises.
Consolidated
2025
$000
2024
$000
AUCyber
4,429
-
Goodwill allocation at 30 June 2025
4,429
-
The recoverable amount of the CGU is determined based on value-in-use calculations. To determine the value-in-use,
management estimates expected future cash flows from each CGU and determines a suitable discount rate in order to calculate
the present value of those cash flows.
A value in use model was developed to provide a forecast of free cash flows for the five financial years ending on 30 June 2030
and a terminal value, based on a one-year budget approved by the Board followed by an extrapolation of expected cash flows
using growth rates of 3% per annum for year 2 onward being the long-term target CPI rate. The present value of the expected
cash flows of each CGU is determined by applying a suitable discount rate.
The data used for impairment testing procedures are directly linked to the Group’s latest approved budget, adjusted as
necessary to exclude the effects of future reorganisations and asset enhancements. Discount rates are determined for each
CGU and reflect current market assessments of the time value of money and asset-specific risk factors.
CGU
Discount Rate (Post
Tax)
Cloud
12%
Managed IT
12%
AUCyber
12%
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
67
NOTES TO THE FINANCIAL STATEMENTS
Impairment Charge for Goodwill
An impairment charge of $7.63 million was recorded for the AUCyber CGU based on impairment testing indicating that the
carrying value exceeded the recoverable amount of the CGU as at 30 June 2025. The underlying reasons for the impairment
charge were the loss of a significant government contract subsequent to the acquisition and the termination of several
unprofitable contracts which resulted in an associated reduction in revenue.
The impairment loss recognised has been allocated to goodwill only, with no impairment required to other assets of the CGU.
Following this allocation, the carrying amount of goodwill is $4.429 million.
No impairment charge was recorded for the Cloud and Managed IT CGUs as their respective recoverable amounts exceeds their
carrying values by $9.4 million and $9.1 million respectively.
Sensitivity analysis undertaken on the key impairment model assumptions indicates that in order for the recoverable amounts to
be equal to their carrying values for the Cloud and Managed IT CGUs, the discount rate would need to increase to 21.7% and
22.8% respectively or the revenue growth rate would need to decrease to 2.8% and 2.7% respectively. Management are not
aware of any events that are expected to have an adverse effect on revenue growth.
15. OTHER INTANGIBLE ASSETS
The following table shows the movements in other intangible assets:
Customer
Contract
Brand
Name
Other
Intangibles
Capitalised
Software
Marketing
Related
Intangibles
Total
$’000
$’000
$’000
$’000
$’000
$’000
Gross carrying amount
At 1 July 2024
-
-
-
-
-
-
Assets acquired in the business acquisition
789
787
98
-
-
1,674
Assets reclassified from held of sale and other
disposals
27
3,270
-
-
-
3,297
Net Loss on transfer of assets held for sale
(15)
(327)
-
-
-
(342)
Closing Value at 30 June 2025
801
3,730
98
-
-
4,629
Amortisation and impairment
At 1 July 2024
-
-
-
-
-
-
Amortisation
(61)
(493)
-
-
-
(554)
Closing value at 30 June 2025
(61)
(486)
-
-
-
(554)
Carrying Amount at 30 June 2025
740
3,237
98
-
-
4,075
Gross carrying amount
At 1 July 2023
20,486
4,017
-
5,432
231
30,166
Additions
-
3,553
-
-
-
3,553
Assets reclassified as held for sale and other
disposals
(20,486)
(7,570)
-
(5,432)
(231)
(33,719)
Closing Value at 30 June 2024
-
-
-
-
-
-
Amortisation and impairment
Balance at 1 July 2023
(5,314)
(2,044)
-
(1,704)
(37)
(9,099)
Amortisation
(947)
(732)
-
(529)
(17)
(2,225)
Assets reclassified as held for sale and other
disposals
6,261
2,776
-
2,233
54
11,324
Closing value at 30 June 2024
-
-
-
-
-
-
Carrying Amount at 30 June 2024
-
-
-
-
-
-
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
68
NOTES TO THE FINANCIAL STATEMENTS
(a) Brand Name and Customer Contracts
Brand names and customer contracts acquired in a
business combination that qualify for separate
recognition are recognised as intangible assets at
their fair values.
Brand names and customer contracts are amortised
on a straight-line basis over their estimated useful
lives of five to ten years.
16. ASSETS HELD FOR SALE
As at 30 June 2024, the assets and liabilities of the Group’s
primary operating subsidiary, 5G Networks Operations Pty
Ltd and its cyber security consultancy business operated
by Security Shift Pty Ltd were classified as held for sale.
On 27 November 2024, the Company announced that the
proposed sale would not proceed and that the Sale
Agreements have been terminated by agreement between
the Company and the entities associated with Mr Joe
Demase. Accordingly, the assets and liabilities of the
Group’s primary operating subsidiary, 5G Networks
Operations Pty Ltd and its cyber security consultancy
business operated by Security Shift Pty Ltd were
reclassified from assets held for sale as at 27 November
2024.
A loss on remeasurement of a non-current asset (or
disposal group) classified as held for sale of $3,339,150 has
been recorded in the profit or loss from continuing
operation.
This amount represents the depreciation and amortisation of
property, plant and equipment, right-of-use assets and
intangible assets for the period when these assets were
classified as held for sale
17. OTHER ASSETS
Other assets consist of the following:
Consolidated
2025
$000
2024
$000
Other prepayments
1,244
-
Inventory
645
-
Security deposits
2,258
871
Bond payments
36
-
Other
175
-
Other Assets - Current
4,358
871
Other Receivables
125
426
Other Assets - Non-Current
125
426
18. TRADE AND OTHER PAYABLES
Consolidated
2025
$000
2024
$000
Trade payables
5,774
3,874
Accrued liabilities
889
136
Other Creditors
938
1,014
Total trade and other payables
7,601
5,024
All amounts are short-term. The carrying values of trade and
other payables are considered to be a reasonable
approximation of fair value.
19. OTHER LIABILITIES
Consolidated
2025
$000
2024
$000
GST and PAYG due to ATO
2,050
-
Payroll tax provision
117
-
Other
1,474
-
Other liabilities - current
3,641
-
20. EMPLOYEE BENEFITS PROVISIONS
Consolidated
2025
$000
2024
$000
Current
Annual leave
1,374
-
Long Service Leave
799
-
Superannuation & Wages
payable
602
-
Accrued bonuses and sales
commission
120
-
Employee Benefits Provisions -
Current
2,895
-
Non-Current
Long service leave
280
-
Employee Benefits Provisions –
Non-current
280
-
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
69
NOTES TO THE FINANCIAL STATEMENTS
21.
BUSINESS ACQUISITIONS
AUCyber Limited
On 3 February 2025, 5G Networks Limited (ASX:5GN)
acquired control of AUCyber Limited (ASX:CYB), a specialist
provider of cyber security solutions, including threat detection,
penetration testing, and managed security services, operating
within the Australian enterprise and government sectors.
AUCyber Limited’s product offering and workforce
complement that of 5GN, and we expect to realise synergies
between the two companies.
Identifiable intangible asset – customer contracts
An intangible asset has been recognised in relation to the
customer relationships held by AUCyber Limited at the time it
was acquired by the Company. The asset has been valued
under the Multi-Period Excess Earnings Method (MPEEM)
whereby an estimate of future cash flows has been discounted
to present-value. The key assumptions used in the valuation
are the forecast revenue growth of 2.5% p.a., observed
customer churn of 18% p.a. and weighted average cost of
capital of 12.5%.
Identifiable intangible asset – Brand Names
An intangible asset has been recognised in relation to the
Brand Names held by AUCyber Limited at the time it was
acquired by the Company. The asset has been valued using
the Relief from Royalty Method (RFRM), whereby estimated
future royalty savings attributable to the asset have been
projected and discounted to present value. The key
assumptions used in the valuation are the forecast revenue
growth of 2.5% p.a., an assumed royalty rate of 3%, and a
weighted average cost of capital of 12.5%.
(a)
Details of the purchase consideration, the net assets
acquired and goodwill are as follows:
$’000
Cash paid
10,762
Total purchase consideration
10,762
This was a stepped acquisition, with 5GN initially acquiring a
10.737% interest in AUCyber on 20 December 2024. Total
ownership came to 50.709% on 3 February 2025, at which
point new directors were appointed and control was obtained.
(b)
Remeasurement of Previously Held Interest:
In accordance with AASB 3, previously held ownership
interests acquired up to the point of acquisition were
remeasured to fair value at the acquisition date, resulting in a
gain of $434,806, recognised in profit or loss.
(c)
Details of the net assets acquired and goodwill are
as follows:
The provisional fair value of the net assets acquired were:
$’000
Cash
4,091
Trade receivables
2,838
Prepayments and Other Receivables
884
Plant and equipment
10,146
Other Intangible Assets
84
Trade payables
(2,130)
Accruals and Other Payables
(6,044)
Employee benefit obligations
(948)
Customer Related Intangibles
789
Brand Names
787
Net identifiable assets acquired
10,497
DTL
(473)
Goodwill
12,058
The goodwill is attributable to the workforce and potential
synergies to be realised in the acquired business. It will not be
deductible for tax purposes.
(d)
Revenue and profit contribution
The acquired business contributed revenues of $9.7m and net
loss of $3.97m to the group for the period from 3 February
2025 to 30 June 2025.
Pro-forma revenue and loss for the year ended 30 June 2025
would have been $85m and $20.46m respectively. These
amounts have been calculated using the acquired
entities’ results.
(e)
Non-controlling Interest
In accordance with AASB 3, the non-controlling interest (NCI)
in AUCyber Limited was measured at its fair value at the
acquisition date, using the prevailing share price of AUCyber
Limited (ASX:CYB) and market-based valuation benchmarks
for comparable entities. This approach reflects the full goodwill
method and results in the recognition of goodwill attributable
to both the parent and the non-controlling interest.
As at 3 February 2025, following the acquisition of control of
AUCyber Limited, 5G Networks Limited held a 50.709%
ownership interest, with the remaining 49.291% held by
non-controlling shareholders.
As at 30 June 2025, further share acquisitions were
undertaken by 5GN, reaching a total 89.96% ownership
in AUCyber.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
70
NOTES TO THE FINANCIAL STATEMENTS
For the period from 3 February 2025 to 30 June 2025:
-
The profit/(loss) attributable to the NCI was ($391,750)
-
The equity interest attributable to the NCI as at 30 June 2025 was $1,825,941.
(f)
Reconciliation of NCI in AUCyber Limited
$’000
Opening NCI balance (as at acquisition date)
10,884
Transactions with NCI (purchase/sale of additional interest without loss of control)
(8,666)
Share of (loss)/profit for the period
(392)
Balance at end of year
1,826
Security Shift
The Group completed the acquisition of Security Shift Pty Ltd . There has been no change to the provisional accounting for the
acquisition from financial year 2024.
22.
ISSUED CAPITAL
During the period, the Company acquired 17,062,448 shares on-market pursuant to an on-market share buyback. No ordinary
shares were issued to vendors or through the exercise of options. In addition, there were no cancellations of shares under an
unmarketable parcel facility and no new shares were issued under ESOP.
Consolidated
2025
$000
2024
$000
Issued and paid-up capital
Ordinary shares each fully paid
195,464
198,292
Movement in ordinary shares on issue
30 June 2025
30 June 2024
Number of
shares
$’000
Number of
shares
$’000
Beginning of the financial period
317,757,331
198,292
329,126,229
200,521
- Issue of shares to vendor
-
-
7,294,118
1,240
- Acquisition of shares through on-market share buyback
(19,915,569)
(2,828)
(20,943,629)
(3,145)
- Cancellation of shares – unmarketable parcel facility
-
-
(4,144,387)
(580)
- Shares issued following exercise of options
-
-
1,625,000
280
- Transaction costs for share issue
-
-
-
(24)
Shares issued and fully paid
297,841,762
195,464
312,957,331
198,292
- Issue of shares under ESOP
-
-
4,800,000
-
End of the financial period
297,841,762
195,464
317,757,331
198,292
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
71
NOTES TO THE FINANCIAL STATEMENTS
ORDINARY SHARES
Ordinary shares entitle the holder to participate in dividends and the proceeds of winding up the company in proportion to the
number of and amounts paid on the shares held.
The fully paid ordinary shares have no par value.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall
have one vote.
SHARE BASED PAYMENTS - EMPLOYEE SHARES
During the year, no shares were issued to employees under the Employee Share Plan as free shares (2024: nil).
Shares acquired under this plan carry all of the same rights and obligations of other shares, except for any rights attaching to shares
by reference to a record date prior to the date of issue or transfer.
SHARE BASED PAYMENTS – OPTIONS
During the year the Group issued 4,000,000 options to key management personnel under the Executive and
Director Share Option Plan as a means of rewarding and incentivising key employees.
Further details of the performance rights, including details of rights issued during the financial year, are set out in Note 26.
There were 35,000,000 performance rights and 29,220,000 unlisted options on issue at the end of the year.
TREASURY SHARES
The loans granted under Executive and Director Share Plan (Note 24) are limited in recourse over the shares issued on exercise of
the options, and the Company placed a holding lock over these shares to secure repayment. These shares were treated as treasury
shares. During the year, there were no performance rights and no unlisted options on issue at the end of the year (2024: 4,800,000).
Movement in treasury shares:
30 June 2025
30 June 2024
Number of
shares
$’000
Number of
shares
$’000
Beginning of the financial period
6,800,000
-
2,000,000
-
- Issue of shares under ESOP
-
-
4,800,000
-
End of the financial period
6,800,000
-
6,800,000
-
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
72
NOTES TO THE FINANCIAL STATEMENTS
23.
RESERVES
Consolidated
2025
$’000
2024
$’000
Share-based payments reserve
16,982
15,153
Other reserve
6,162
5,450
Foreign currency reserve
81
147
Reorganisation reserve
(150,804)
(150,804)
Total
(127,579)
(130,054)
Share-based payment reserve
Consolidated
2025
$’000
2024
$’000
Balance at the beginning of the period
Arising on share-based payments
15,153
1,829
13,017
2,136
Balance at the end of the year
16,982
15,153
The share-based payments reserve is used to recognise the value of equity-settled share-based payment transactions provided to
employees, including KMP, as part of their remuneration.
Other reserves
2025
$’000
2024
$’000
Balance at the beginning of the period
5,450
5,450
Other reserves
712
-
Balance at the end of the year
6,162
5,450
Other reserves represent the fair value reserve (for equity investments at fair value through equity) and transactions with NCI reserve.
The fair value reserve of financial assets at FVOCI is used to record changes to the fair value of non-current financial asset as
disclosed in note 28 to the financial statements. The transactions with NCI reserve represents the difference between the
consideration paid (or received) for changes in the Group’s ownership interest in a subsidiary, without a change in control, and the
carrying amount of the non-controlling interest at the date of the transaction. This reserve reflects transactions with non-controlling
interests that are recognised directly in equity rather than through profit or loss.
Foreign currency reserve
2025
$’000
2024
$’000
Balance at the beginning of the period
147
288
Currency translation differences
(66)
(141)
Balance at the end of the year
81
147
The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial
statements of foreign subsidiaries.
Reorganisation reserve
2025
$’000
2024
$’000
Balance at the beginning of the period
(150,804)
(150,804)
Balance at the end of the year
(150,804)
(150,804)
Reorganisation reserve is used to record any difference arising when applying a book-value method to business combinations
under common control.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
73
NOTES TO THE FINANCIAL STATEMENTS
24.
SHARE-BASED PAYMENTS - PERFORMANCE RIGHTS AND OPTIONS
The Group operates two long-term incentive (LTI) plans as a means of rewarding and incentivising directors, executives and senior
leaders of the Group.
The Company’s Executive and Director Share Option Plan (ESOP) was adopted in December 2020 for directors and executives of
the Group. The Company’s Executive Equity Plan (EEP) was adopted in April 2022 for executives and senior leaders of the Group.
The key criteria for options issued under the ESOP and EEP during the year are the completion of tenure periods between one and
three years and the achievement of individual KPIs.
The Performance Rights and Options will not give the holder a legal or beneficial interest in ordinary fully paid shares in the
Company until those Performance Rights and Options vest. Prior to vesting, Performance Rights and Options do not carry a right to
vote or receive dividends. When the Performance Rights and Options have vested, ordinary fully paid shares will be allocated, and
these shares will rank equally with existing Company shares.
(a)
Rights and options held at the beginning of the reporting period
There were 58,220,000 rights and options held as at 1 July 2024 in relation to the ESOP and EEP.
(b)
Movement of rights and options during the reporting period
The following table summarises the movement in performance rights and options issued during the year:
2025
Number
2024
Number
Outstanding at the beginning of the year
58,220,000
44,070,000
Granted during the year
1
9,250,000
24,000,000
Vested and exercised during the year
-
(5,300,000)
Lapsed during the year
-
-
Forfeited during the year
2
(9,000,000)
(4,550,000)
Outstanding at year end
58,470,000
58,220,000
1.
During the year, 9,250,000 Performance Rights and Options were granted under the EEP (2024: nil) and no Options were granted under
the ESOP (2024: 24,000,000).
2.
During the year, 9,000,000 Options were forfeited under the ESOP (2024: 2,600,000) and none were forfeited under the EEP (2024: 1,950,000).
(c)
Rights and options vested during the reporting period
During the year, no Performance Rights were vested (2024: Nil) and 2,250,000 Options vested (2024: 5,300,000).
(d)
Rights and options forfeited during the reporting period
During the year, 9,000,000 Options were forfeited by employees (2024: 2,600,000) with a weighted average exercise price of $0.22
(2024: zero) under the ESOP and no Options were forfeited by employees (2024: 1,950,000) with a weighted average exercise price
of zero (2024: zero) under the EEP.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
74
NOTES TO THE FINANCIAL STATEMENTS
(e)
Rights and options held at the end of the reporting period
The following table summarises information about Performance Rights and Options held by Directors and employees as at
30 June 2025. 5,000,000 Performance Rights and 12,720,000 Options are exercisable at 30 June 2025 (2024: 5,000,000
Rights and 9,720,000 Options):
Issue Date and Type
Number
Grant date
Vesting date
Expiry date
Weighted
average
exercise
price
Weighted
average
remaining
contractual
life
2020 Performance Rights - Director
5,000,000
18/12/2020
22/09/2021
18/12/2025
$0.20
0.47
2021 Performance Rights - Director
15,000,000
22/12/2021
n/a
21/12/2026
$0.45
1.48
2021 Options - Director
1,500,000
22/12/2021
22/12/2023
21/12/2026
$0.45
1.48
2021 Options - Executive (1)
100,000
01/02/2021
01/02/2023
01/02/2026
$0.485
0.59
2021 Options - Executive (2)
100,000
29/03/2021
29/03/2023
29/03/2026
$0.485
0.74
2021 Options – Executive (3)
1,900,000
15/07/2021
15/07/2023
15/07/2026
$0.45
1.04
2022 Options – Executive (1)
260,000
13/04/2022
13/04/2023
13/04/2025
$0.26
0.00
2022 Options – Executive (2)
2,600,000
02/06/2022
02/06/2024
02/06/2027
$0.25
1.92
2022 Options – Executive (3)
2,000,000
1/09/2022
1/09/2024
1/09/2027
$0.20
2.17
2022 Options – Executive (4)
260,000
3/10/2022
n/a
3/10/2025
$0.20
0.26
2022 Options – Executive (7)
250,000
14/12/2022
14/12/2024
14/12/2025
$0.17
0.46
2023 Options – Executive (1)
2,250,000
29/06/2023
29/06/2025
29/06/2028
$0.11
3.00
2023 Performance Rights - Director
15,000,000
7/12/2023
7/12/2025
7/12/2028
$0.11
3.44
2023 Options - Director
3,000,000
7/12/2023
7/12/2025
7/12/2028
$0.11
3.44
2024 Options – Executive
7,250,000
6/12/2024
6/12/2026
6/12/2029
$0.15
4.44
2024 Options – Executive
2,000,000
6/12/2024
6/12/2027
6/12/2029
$0.15
4.44
58,470,000
$0.24
2.53
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
75
NOTES TO THE FINANCIAL STATEMENTS
(f)
Pricing model: LTI grants
The fair values of options granted were determined using a variation of the binomial option pricing model that takes into account
factors specific to the Executive Share Plan, such as the vesting period. The following principal assumptions were used in
the valuation:
Share price
Dividend yield
Expected
volatility
Risk-free
interest rate
Fair value per
option
2020 Rights
$0.415
0.0%
73.4%
0.38%
$0.3031
2021 Rights
$0.465
0.0%
45.0%
1.27%
$0.192
2021 Options
$0.465
0.0%
45.0%
1.27%
$0.3031
2021 Options (1)
$0.44
0.0%
73.4%
0.42%
$0.16
2021 Options (2)
$0.53
0.0%
73.4%
0.68%
$0.23
2021 Options (3)
$0.475
0.0%
73.4%
0.69%
$0.205
2022 Options (1)
$0.275
0.0%
73.4%
2.74%
$0.20
2022 Options (2)
$0.225
0.0%
73.4%
3.28%
$0.09
2022 Options (3)
$0.175
2.9%
96.1%
3.50%
$0.08
2022 Options (4)
$0.145
3.6%
94.6%
3.70%
$0.06
2022 Options (7)
$0.16
3.1%
93.3%
3.06%
$0.07
2023 Options (1)
$0.13
3.8%
92.8%
3.93%
$0.06
2023 Options (2)
$0.13
3.8%
92.8%
3.93%
$0.05
2023 Rights
$0.24
2.1%
90.0%
3.86%
$0.17
2023 Options (3)
$0.24
2.1%
90.0%
3.86%
$0.17
2024 Options
$0.17
4.9%
94.0%
3.76%
$0.08
2024 Options
$0.17
4.9%
94.0%
3.75%
$0.09
The expected volatility was determined using the group’s average five-year share price. The risk-free rate is derived from the yield
on Australian Government Bonds of an appropriate term. The weighted average fair value of the performance rights and options
granted during the year was $0.08 (2024: $0.17).
The total consolidated share-based payment expense for the year was $1.829 million (2024: $2,136 million).
25. DIVIDENDS
No dividends were declared or paid during the financial year 2025.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
76
NOTES TO THE FINANCIAL STATEMENTS
26.
PARENT INFORMATION
The following information has been extracted from the books and records of the parent and has been prepared in accordance with
Australian Accounting Standards.
The parent entity for the group is 5G Networks Limited and following information is the financial position for 5G Networks Limited.
PARENT ENTITY STATEMENT OF FINANCIAL POSITION
As at 30 June 2025
2025
$’000
2024
$’000
Current assets
28,478
68,927
Non-current assets
19,642
3,224
Total assets
48,120
72,151
Current liabilities
20,055
35,410
Non-current liabilities
66
-
Total liabilities
20,121
35,410
Net assets
27,999
36,741
Contributed equity
212,000
213,589
Share-based payments reserve
44,035
7,966
Reorganisation reserve
(150,804)
(150,804)
Foreign currency reserve
(88)
(88)
Other reserves
(2,870)
12,589
Non-controlling interest
1,826
-
Retained earnings
(76,100)
(46,511)
Total Equity
27,999
36,741
Profit/(Loss) of the parent entity
(206)
91,942
Total comprehensive income of the parent entity
(206)
92,083
GUARANTEES
During the reporting period, each of the companies in the Group (excluding AUCyber Limited, Sovereign Cloud Australia Pty Ltd,
AUCyber Solutions Pty Ltd, Venn IT Solutions Pty Ltd & AU123 Pty Ltd), including 5G Network Limited provided a cross guarantee
to CBA for the facilities provided by CBA (refer note 28).
CONTINGENT LIABILITIES
The parent entity did not have any contingent liabilities as at 30 June 2025 (30 June 2024: Nil).
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
77
NOTES TO THE FINANCIAL STATEMENTS
27. CONTROLLED ENTITIES
Investments in controlled entities are initially recognised at cost, being the fair value of the consideration given. Following initial
recognition, investments are measured at cost less any accumulated impairment losses.
The consolidated financial statements include the financial statements of 5G Networks Limited and the subsidiaries in the
following table:
Entity
Country of incorporation
Equity holding as at 30 June
2025
2024
5G Networks Limited
Australia
100%
100%
5G Networks Holdings Pty Ltd
Australia
100%
100%
5G Network Operations Pty Ltd
Australia
100%
100%
Intergrid Group Pty Ltd
Australia
100%
100%
Annitel Pty Ltd
Australia
100%
100%
Hostworks Group Pty Ltd
Australia
100%
100%
Hostworks Pty Ltd
Australia
100%
100%
Enspire Pty Ltd
Australia
100%
100%
Australian Pacific Data Centres Pty Ltd
Australia
100%
100%
Asian Pacific Telecommunications Pty Ltd
Australia
100%
100%
Modular I.T. Pty Ltd
Australia
100%
100%
Security Shift Pty Ltd
Australia
100%
100%
Security Shift Holdings Pty Ltd
Australia
100%
100%
Security Shift Group Pty Ltd
Australia
100%
100%
5G Networks Finance Pty Ltd
Australia
100%
100%
Uber Global Pty Ltd
Australia
100%
100%
Uber Business Pty Ltd
Australia
100%
100%
5G Networks Lanka (PVT) Ltd
Sri Lanka
100%
100%
AUCyber Limited
Australia
89.96%
N/A
Sovereign Cloud Australia Pty Ltd
Australia
89.96%
N/A
AUCyber Solutions Pty Ltd
Australia
89.96%
N/A
Venn IT Solutions Pty Ltd
Australia
89.96%
N/A
AU123 Pty Ltd
Australia
89.96%
N/A
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
78
NOTES TO THE FINANCIAL STATEMENTS
28. FINANCIAL RISK MANAGEMENT
The main risks the Group is exposed to through its financial instruments are interest rate risk, liquidity risk and credit risk.
FINANCIAL RISK MANAGEMENT OBJECTIVES
The Group’s financial instruments consist mainly of deposits with banks, local money market instruments, accounts receivable and
payable, loans to and from subsidiaries, and leases.
The main purpose of non-derivative financial instruments is to raise finance for Group operations.
The Group does not have any derivative instruments at 30 June 2025 or 30 June 2024.
The totals for each category of financial instruments, measured in accordance with AASB 9 as detailed in the accounting policies to
these financial statements, are as follows:
30 June 2025
Amortised Cost
FVTPL
FVOCI
Total
$000
$000
$000
$000
Cash and cash equivalents
25,914
-
-
25,914
Restricted cash
3,315
-
-
3,315
Trade and other receivables
7,545
-
-
7,545
Unsecured loans
-
378
-
378
Other financial assets
5,425
-
725
6,150
Total financial assets
42,199
378
725
43,302
Non-current lease liabilities
10,779
-
-
-
10,779
Trade and other payables
7,601
-
-
7,601
Lease liabilities
5,323
-
-
5,323
Other financial liabilities
3,466
175
-
3,641
Total financial liabilities
27,169
175
-
27,344
30 June 2024
Amortised Cost
FVTPL
FVOCI
Total
$000
$000
$000
$000
Cash and cash equivalents
68,322
-
-
68,322
Restricted cash
2,925
-
-
2,925
Trade and other receivables
3,549
-
-
3,549
Unsecured loans
-
378
-
378
Other financial assets
-
-
725
725
Total financial assets
74,796
378
725
75,899
Non-current lease liabilities
9,125
-
-
9,125
Trade and other payables
11,967
-
-
11,967
Lease liabilities
3,316
-
-
3,316
Other financial liabilities
-
2,094
-
2,094
Total financial liabilities
24,408
2,094
-
26,502
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
79
NOTES TO THE FINANCIAL STATEMENTS
FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS
The Group measures financial instruments such as derivatives at fair value at each reporting date. Fair value is the price that
would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the
measurement date. The fair- value measurement is based on the presumption that the transaction to sell the asset or transfer
the liability takes place either:
•
in the principal market for the asset or liability, or
•
in the absence of a principal market, in the most advantageous market for the asset or liability
The fair value of an asset or liability is measured using the assumptions that market participants would use when pricing the
asset or liability, assuming that the market participants act in their economic best interest.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within their fair-
value hierarchy, described as follows, based on the lowest level of input that is significant to the fair value measurement as
a whole:
•
Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
•
Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or
indirectly observable.
•
Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is
unobservable.
For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the Group determines
whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level
input that is significant to the fair value measurement as a whole) at the end of each reporting period.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
80
NOTES TO THE FINANCIAL STATEMENTS
The following table provides the fair value measurement hierarchy of the Group’s financial assets and liabilities as at
30 June 2025:
Note
Date of
valuation
Total
Fair value measurement using
Quoted prices
in active
markets
(Level 1)
Significant
observable
inputs
(Level 2)
Significant
unobservable
inputs
(Level 3)
$’000
$’000
$’000
$’000
Assets / (liabilities) measured at
fair value
Financial assets
Investment in The Pistol shares
30-Jun-25
725
-
-
725
Unsecured loans
30-Jun-25
378
-
-
378
Financial liabilities
Contingent consideration
30-Jun-25
175
-
-
175
There have been no transfers between Level 1, 2 and 3 during the period.
CAPITAL MANAGEMENT
For the purpose of the Group’s capital management, capital includes issued capital, all other equity reserves attributable to the
equity holders of the parent and debt capital, principally raised from the Group’s banking partners, but inclusive of other debt- like
instruments, such as earn-outs due. The Board’s primary objective is to maximise the value of the Group’s operations to its
shareholders.
The Group manages its capital structure and financing facilities and makes adjustments in light of changes in economic and market
conditions, requirements of the business operations and requirements of its financial covenants. To maintain or adjust the capital
structure, the Group may raise or repay debt, adjust the dividend payment to shareholders, return capital to shareholders, issue new
shares, or sell assets to fund these activities.
LIQUIDITY RISK
The Group manages liquidity risk by monitoring forecast cash flows and ensuring that adequate unutilised borrowing facilities are
maintained.
Cash flows realised from financial assets in the table below reflect management’s expectation as to the timing of realisation. Actual
timing may therefore defer from that disclosed.
The table below sets out the available financing facilities as at 30 June 2025:
Total facility amount
Amount drawn
Unused financing
facilities
$000
$000
$000
CBA contingent loan facilities (bank guarantees)1
3,315
3,315
-
Total
3,315
3,315
-
1.
The bank guarantees are cash-backed with a term deposit with Commonwealth Bank of Australia. The term deposit is recorded as Restricted Cash in the
Statement of Financial Position.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
81
NOTES TO THE FINANCIAL STATEMENTS
The table below sets out the maturity periods of the financial liabilities of the consolidated Group as at 30 June 2025 and 30 June
2024. All carrying amounts of IT equipment finance are undiscounted contractual cash flows.
Contracted maturities at
30 June 2025
< 6 Months
6-12 Months
1-2 Years
2-5 Years
> 5 Years
Total
$000
$000
$000
$000
$000
$000
Trade & Other Payables
7,601
-
-
-
-
7,601
Other Financial Liabilities
3,641
-
-
-
-
3,641
Contracted maturities at
30 June 2024
< 6 Months
6-12 Months
1-2 Years
2-5 Years
> 5 Years
Total
$000
$000
$000
$000
$000
$000
Trade & Other Payables
11,967
-
-
-
-
11,967
Other Financial Liabilities
-
-
2,094
-
-
2,094
CREDIT RISK
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial
assets, is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the balance sheet and notes to
the financial statements.
There are no material amounts of collateral held as security at 30 June 2025 or 30 June 2024.
Credit risk is managed on a Group basis and reviewed regularly by the Board. It arises from exposures to customers as well as
through deposits with financial institutions.
The following table provides information regarding the credit risk relating to cash and money market securities based on Moody’s
counterparty credit ratings.
Consolidated
2025
$’000
2024
$’000
Aa3 rated cash & cash equivalents
25,914
68,322
Aa3 rates restricted cash (term deposit)
3,315
2,925
TOTAL
29,229
71,247
The Group does not have any material credit risk exposure to any single receivable or group of receivables under financial
instruments entered into by the Group.
INTEREST RATE AND MARKET RISK
Market risk is the risk that changes in market prices, such as interest rates will affect the Group’s income or the value of its holdings
of financial instruments. The objective of market risk management is to manage and control market risk exposures within
acceptable parameters, while optimising returns.
At 30 June 2025, the Group is not exposed to changes in market interest rates through bank borrowings at variable interest rates.
All of the Group’s bank guarantees are at a fixed interest rate.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
82
NOTES TO THE FINANCIAL STATEMENTS
TREASURY RISK
The Board’s overall risk management strategy seeks to assist
the consolidated Group in meeting its financial targets, whilst
minimising potential adverse effects on financial performance.
FOREIGN CURRENCY RISK
The Group conducts some of its business in US dollars
(‘USD’), New Zealand Dollars (‘NZD’), Singapore Dollars
(‘SGD’), Great British Pounds (“GBP”) and Japanese Yen
(‘JPY’) and is therefore exposed to movements in the AUD
exchange rates with USD, NZD, SGD, GBP and JPY
respectively. The Group actively manages the gross margin
risk by its foreign currency risk management strategy.
Both the functional and presentation currency of the Group is
in Australian dollars (AUD). The consolidated Group contains
functional currencies in USD, NZD, SGD, GBP and JPY.
Transactions in foreign currencies are initially recorded in the
functional currency at the exchange rates ruling at the date of
the transaction. Monetary assets and liabilities denominated
in foreign currencies are retranslated at the rate of exchange
ruling at the reporting date.
The exchange differences arising on the retranslation are
taken directly to other comprehensive income. On disposal of
a foreign entity, the deferred cumulative amount recognised in
other comprehensive income relating to that particular foreign
operation is recognised in the determination of profit and loss
for the year.
At 30 June 2025, the Group had the following exposures to
USD, NZD, SGD, GBP and JPY. denominated assets and
liabilities, where the functional currency is not USD, NZD,
SGD, GBP and JPY. The Group’s exposure to foreign
currency changes for all other currencies is not material.
2025
$’000
2024
$’000
Financial assets
Cash and cash equivalents
103
314
Trade and other receivables
511
116
Financial liabilities
Trade and other payables
(558)
(1,043)
Net exposure
56
(613)
The following sensitivity is based on foreign currency risk
exposures in existence at the reporting date.
At 30 June 2025, had the AUD moved as illustrated in the
table below with all other variables held constant, post-tax
profit and equity would have been affected as follows:
Net profit Higher /
(Lower)
Equity Higher /
(Lower)
2025
$’000
2024
$’000
2025
$’000
2024
$’000
Consolidated
- AUD/USD +10%
5
39
5
39
- AUD/USD -10%
(4)
(48)
(4)
(48)
The Group also has exposures to foreign exchange when
retranslating foreign currency subsidiaries into AUD. The
sensitivity range has been determined using an expected
range of 0.58 to 0.71 USD/AUD for the retranslation of USD
denominated balances for the forthcoming year.
SENSITIVITY ANALYSIS
As the Group’s bank guarantee loans are not material to the
Group and at a fixed interest rate, no sensitivity analysis has
been performed, as any +/- variation in interest rates would
not have a material impact on the post-tax profit for the
remaining period of the loans.
A change in interest rates on the Cash on Deposit would not
have a material impact to the Group and therefore no
sensitivity analysis has been performed.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
83
NOTES TO THE FINANCIAL STATEMENTS
29.
RELATED PARTY DISCLOSURES
Subsidiaries
Details relating to subsidiaries are included in Note 27.
Ultimate and direct parent
5G Networks Limited is the ultimate parent entity in the wholly
owned Group comprising the Company and its wholly owned
controlled entities.
Key Management Personnel (KMP) Compensation
Consolidated
2025
$’000
2024
$’000
Short-Term Employee Benefits
978
1,523
Post-Employment Benefits
51
109
Termination Payments
7
51
Share based Payments
1,626
1,946
TOTAL
2,662
3,629
Detailed remuneration disclosures are provided in the
remuneration report on pages 22 to 30.
Transactions with related parties
During the year, the Group has conducted the following
related party transactions:
•
A total of $45,969 (2024: $871,622) was paid to Studio
Inc., an entity related to Joseph Demase, for the design
of marketing materials for the Group. All transactions
are carried at commercial third-party rates.
•
A total of $41,728 (2024: nil) made to Mr Hunter Demase
during the year ended 30 June 2025 for sales consulting
services. All transactions are carried at commercial
third-party rates.
Terms and conditions of related party trading transactions
Purchases from related parties are made at arm’s length at
normal market prices and on normal commercial terms.
The Group settles related party trade payables according to
the payment conditions confirmed by the supplier of invoices
and are non-interest bearing and generally on 30 day terms
from invoice.
Transactions with key management personnel
The table below provides aggregate information relating to
the Company’s loans to key management personnel during
the year:
2025
$’000
Balance at the start of the year
128
Repayment from KMP
-
Balance at the end of the year
128
30.
AUDITORS’ REMUNERATION
2025
$
2024
$
During the year ended 30 June
2025, the following fees were
paid or payable for services
provided by:
Grant Thornton Audit Pty Ltd
in respect of:
Audit and review
305,035
466,004
Taxation and other
compliance services
-
181,958
Due diligence services
35,504
48,107
Bentleys Brisbane (Audit) Pty
Ltd in respect of:
Audit and review
87,200
-
427,739
696,069
31.
EVENTS SUBSEQUENT TO REPORTING
DATE
Following the release of AuCyber Limited’s (ASX:CYB) Annual
Report on 26 August 2025, 5GN has made additional on-
market purchases utilising section 611 of the Corporations
Act 2001 (Cth) (“Corporations Act”) (“3% creep rule”). Under
the 3% creep rule, in the six months commencing 29 August
2025, 5GN may purchase up to 92.86% of CYB’s issued
shares.
5GN has six months from 3 September 2025 in which it may
exercise its general compulsory acquisition power pursuant to
section 664A of the Corporations Act to acquire the
remainder of CYB’s issued ordinary shares. The Board of
5GN has not yet determined if it will exercise this power.
Other than the above, there has not been any matter or
circumstance in the interval between the end of the year and
the date of this report that has materially affected or may
materially affect the operations of the Group, the results of
those operations or the state of affairs of the Group in
subsequent financial periods.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
84
CONSOLIDATED ENTITY DISCLOSURE STATEMENT
Set out below is a list of entities that are consolidated in this set of Consolidated Financial Statements at the end of the
financial year.
Name of Entity
Type of entity
Trustee,
partner, or
participant
in JV
Place of
incorporation
% of Share
Capital as at
30 June 2024
Australian or
foreign tax
resident
Jurisdiction
for foreign
tax resident
5G Networks Limited
Body corporate
-
Australia
100%
Australian
N/A
5G Networks Holdings Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
5G Network Operations Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Intergrid Group Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Annitel Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Hostworks Group Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Hostworks Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Enspire Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Australian Pacific Data Centres Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Asian Pacific Telecommunications Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Modular I.T. Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Security Shift Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Security Shift Holdings Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Security Shift Group Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
5G Networks Finance Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Uber Global Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
Uber Business Pty Ltd
Body corporate
-
Australia
100%
Australian
N/A
5G Networks Lanka (PVT) Ltd
Body corporate
-
Sri Lanka
100%
Australian
N/A
AUCyber Limited
Body corporate
-
Australia
89.96%
Australia
N/A
Sovereign Cloud Australia Pty Ltd
Body corporate
-
Australia
89.96%
Australia
N/A
AUCyber Solutions Pty Ltd
Body corporate
-
Australia
89.96%
Australia
N/A
Venn IT Solutions Pty LTd
Body corporate
-
Australia
89.96%
Australia
N/A
AU123 Pty Ltd
Body corporate
-
Australia
89.96%
Australia
N/A
Basis of preparation
This consolidated entity disclosure statement (CEDS) has been prepared in accordance with the Corporations Act 2001 and
includes information for each entity that was part of the consolidated entity as at the end of the financial year in accordance with
AASB10: Consolidated Financial Statements.
Determination of tax residency
Section 295 (3A)(vi) of the Corporation Act 2001 defines tax residency as having the meaning in the Income Tax Assessment Act
1997. The determination of tax residency involves judgement as there are different interpretations that could be adopted, and which
could give rise to a different conclusion on residency. In determining tax residency, the consolidated entity has applied the
following interpretations:
•
Australian tax residency
The consolidated entity has applied current legislation and judicial precedent, including having regard to the Tax
Commissioner’s public guidance in Tax Ruling TR 2018/5
•
Foreign tax residency
Where necessary, the consolidated entity has used independent tax advisers in foreign jurisdictions to assist in its
determination of tax residency to ensure applicable foreign tax legislation has been complied with (see section 295(3A)(vii) of
the Corporations Act 2001).
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
85
DIRECTORS’ DECLARATION
1.
In the Directors’ opinion:
(a)
The financial statements and notes of 5G Networks Limited for the year ended 30 June 2025 are in accordance
with the Corporations Act 2001, including:
(i)
giving a true and fair view of the Group’s financial position as at 30 June 2025 and of its performance for the
financial year ended on that date; and
(ii)
complying with Australian Accounting Standards (Including the Australian Accounting Interpretations) and the
Corporations Regulations 2001;
(b)
There are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due
and payable; and
(c)
The consolidated entity disclosure statement on page 84 is true and correct.
2.
The Directors have been given the declaration required by Section 295A of the Corporations Act 2001 from the Chief
Executive Officer and Chief Financial Officer for the year ended 30 June 2025.
3.
Note 2 confirms that the consolidated financial statements also comply with international financial reporting standards.
Signed in accordance with a resolution of the Directors made pursuant to section 303(5) of the Corporations Act 2001. On behalf
of the Board of Directors
Joseph Demase
Managing Director
Melbourne, 25 September 2025
Grant Thornton Audit Pty Ltd
Level 22 Tower 5
Collins Square
727 Collins Street
Melbourne VIC 3008
GPO Box 4736
Melbourne VIC 3001
T +61 3 8320 2222
www.grantthornton.com.au
ACN-130 913 594
Grant Thornton Audit Pty Ltd ACN 130 913 594 a subsidiary or related entity of Grant Thornton Australia Limited ABN 41 127 556 389 ACN 127 556 389.
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or
refers to one or more member firms, as the context requires. Grant Thornton Australia Limited is a member firm of Grant Thornton International Ltd (GTIL).
GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are delivered by the member
firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and are not liable for one
another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127
556 389 ACN 127 556 389 and its Australian subsidiaries and related entities. Liability limited by a scheme approved under Professional Standards
Legislation.
Independent Auditor’s Report
To the Members of 5G Networks Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of 5G Networks Limited (the Company) and its subsidiaries (the Group),
which comprises the consolidated statement of financial position as at 30 June 2025, the consolidated
statement of profit or loss and other comprehensive income, consolidated statement of changes in equity
and consolidated statement of cash flows for the year then ended, and notes to the consolidated financial
statements, including material accounting policy information, the consolidated entity disclosure statement
and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
a
giving a true and fair view of the Group’s financial position as at 30 June 2025 and of its performance
for the year ended on that date; and
b
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section
of our report. We are independent of the Group in accordance with the auditor independence requirements
of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled
our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Grant Thornton Audit Pty Ltd
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report of the current period. These matters were addressed in the context of our audit of the financial
report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these
matters.
Key audit matter
How our audit addressed the key audit matter
Revenue - note 2 and note 5
In the financial year ended 30 June 2025, the Group recorded
revenue of $62,634,000. There is a risk of potential
overstatement of revenue given there is pressure placed on
the performance of the Group against market expectations.
The Group offers a diverse range of services to its customers
that require different patterns of revenue recognition due to
varying contractual terms, which require the identification of
performance obligations, and the determination of how the
Group satisfies those obligations.
This area is a key audit matter because of the financial
significance of revenue to the consolidated statement of profit
or loss and other comprehensive income, and the judgement
involved in determining appropriate revenue recognition for
these various services.
Our procedures included, amongst others:
•
Obtaining an understanding of the processes and controls
used by the Group in evaluating contracts under the five-
step model of AASB 15 Revenue Contracts with
Customers;
•
Reviewing revenue recognition policies of individual
customer agreements and contractual arrangements to
ensure compliance with AASB 15;
•
Analytically reviewing revenue streams against forecasts
and prior corresponding period to identify and assess
potential anomalies;
•
Selecting a sample of revenue transactions to verify that
revenue was being recognised in accordance with revenue
recognition policies;
•
Testing the accuracy of deferred revenue recorded by the
Group during the period; and
•
Evaluating the disclosures in the financial statements for
appropriateness and consistency with accounting
standards.
Goodwill – note 2 and note 14
As disclosed in Note 14 of the financial report an impairment
charge of $7,629,000 was recognised during the year which
brought the balance of goodwill to $4,429,000 at year-end.
In accordance with AASB 136 Impairment of Assets, goodwill
acquired in a business combination must be allocated to the
Group’s cash generating units (“CGUs”). For each CGU to
which goodwill has been allocated, the Group is required to
assess if the carrying value of the CGU is in excess of the
recoverable value.
The goodwill impairment assessment has been assessed as a
key audit matter due to the judgement required by
management in preparing a value in use model to satisfy the
impairment test as prescribed in AASB 136, including the
significant estimation involved in forecasting of future cash
flows and applying an appropriate discount rate which
inherently involves a high degree of estimation and judgement
by management.
Our procedures included, amongst others:
•
Assessing management’s determination of the Group
having three CGUs based on the nature of the business
and the economic environment in which they operate;
•
Assessing management’s annual impairment assessment
for compliance with AASB 136;
•
Assessing whether management has the requisite
expertise to prepare the impairment model, including:
−
Assessing the reasonableness and appropriateness of
inputs and assumptions to the model;
−
Evaluating management’s future cash flow forecasts
and obtain an understanding of the process by which
they were developed;
−
Assessing management’s key assumptions for
reasonableness and obtaining available evidence to
support key assumptions;
−
Considering the reasonableness of the revenue and
cost forecasts against prior year forecasts and current
year actuals;
−
Performing sensitivity analysis of the key assumptions;
−
Testing the underlying calculations for mathematical
accuracy of the model;
•
Evaluating the fair value less cost to sell of the business
acquired in the period;
•
Evaluating the disclosures in the financial statements for
appropriateness and consistency with accounting
standards.
Grant Thornton Audit Pty Ltd
Business acquisition – note 2 and note 21
As disclosed in note 21, on 3 February 2025, 5G Networks
Limited acquired control of AUCyber Limited, a specialist
provider of cyber security solutions. This was a stepped
acquisition, with 5G Networks Limited initially acquiring a
10.737% interest in AUCyber Limited on 20 December 2024.
Total ownership came to 50.709% on 3 February 2025, at
which point new directors were appointed and control was
obtained.
The non-controlling interest (NCI) in AUCyber Limited was
measured at its fair value at the acquisition date, with further
share acquisitions undertaken by the Group up until 30 June
2025, when they held 89.96% ownership in AUCyber Limited.
As part of the transaction 5G Networks Limited recognised
$12,058,000 goodwill on acquisition, $789,000 customer
related intangibles and $787,000 brand names, as part of the
purchase price allocation calculations.
The acquisition of the business creates other areas of risk,
including:
•
Assessing if the transaction is a business combination in
line with AASB 3 Business Combinations and accounting
for the transaction as a step acquisition;
•
Determining the fair value of the acquired assets and
liabilities, as well as the goodwill arising on acquisition;
•
The valuation of any separable identifiable intangibles
arising on acquisition;
•
The measurement of the fair value of the non-controlling
interest in AUCyber Limited at the date of acquisition, and
the subsequent measurement of the change in NCI
throughout the period.
Given the complexity and judgement involved in this
transaction, we have determined this to be an area of audit
focus and a key audit matter.
Our procedures included, amongst others:
•
Reading board meeting minutes, ASX announcements and
any other relevant documentation;
•
Reviewing the technical paper prepared by management
and assessing the acquisition accounting against the
requirements of Australian Accounting Standards;
•
Testing the accuracy of the purchase consideration against
publicly available information;
•
Assessing the fair values of the acquired assets and
liabilities recognised, and performing testing on material
balances recorded as part of the acquisition accounting
workings;
•
Evaluating the competency, capabilities and objectivity of
management’s expert, and assessing the adequacy of their
work;
•
Engaging auditor’s valuation experts to assess purchase
price allocation and the recognition and valuation of any
identified intangibles arising from the transaction;
•
Testing the accuracy of the non-controlling interest
recognised at the acquisition date and the value of any
other transaction recorded in relation to changes in
ownership in the period;
•
Assessing the appropriateness of accounting policy
including compliance with the Australian Accounting
Standards (AASBs); and
•
Evaluating the disclosures in the financial statements for
appropriateness and consistency with accounting
standards.
Information other than the financial report and auditor’s report thereon
The Directors are responsible for the other information. The other information comprises the information included
in the Group’s annual report for the year ended 30 June 2025 but does not include the financial report and our
auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the financial report
The Directors of the Company are responsible for the preparation of:
a
the financial report that gives a true and fair view in accordance with Australian Accounting Standards and
the Corporations Act 2001 (other than the consolidated entity disclosure statement); and
b
the consolidated entity disclosure statement that is true and correct in accordance with the Corporations Act
2001, and
for such internal control as the Directors determine is necessary to enable the preparation of:
i.
the financial report that gives a true and fair view and is free from material misstatement, whether due
to fraud or error; and
the consolidated entity disclosure statement that is true and correct and is free of misstatement,
whether due to fraud or error.
ii.
In preparing the financial report, the Directors are responsible for assessing the Group’s ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: https://www.auasb.gov.au/media/bwvjcgre/ar1_2024.pdf. This
description forms part of our auditor’s report.
Report on the remuneration report
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
Grant Thornton Audit Pty Ltd
Chartered Accountants
M J Climpson
Partner – Audit & Assurance
Melbourne, 25 September 2025
Grant Thornton Audit Pty Ltd
Opinion on the remuneration report
We have audited the Remuneration Report included in pages 22 to 30 of the Directors’ report for the year
ended 30 June 2025.
In our opinion, the Remuneration Report of 5G Networks Limited, for the year ended 30 June 2025 complies
with section 300A of the Corporations Act 2001.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
90
SHAREHOLDER INFORMATION
The shareholder information set out below was applicable as at 1 September 2025.
5G Networks Limited
Issued capital ordinary shares: 297,841,762 as at 1 September 2025.
Substantial Shareholders
Substantial shareholders and the number of equity securities in which it has an interest, as shown in the Company’s register of
Substantial Shareholders is:
Shares
%
BNP PARIBAS NOMINEES PTY LTD
59,000,941
19.81%
5GN CLOUD PTE LTD
55,000,000
18.47%
TOTAL
114,000,941
38.28%
DISTRIBUTION OF EQUITY SHARES
Ordinary Shares
Number Held
Number of Holders
1 – 1,000
81,654
164
1,001 – 5,000
5,547,047
1,563
5,001 – 10,000
9,486,375
1,269
10,001 – 100,000
46,432,054
1,711
100,001 – and over
236,294,632
228
TOTAL
297,841,762
4,935
There were 992 unmarketable parcels as at 1 September 2025.
VOTING RIGHTS
The voting rights attached to each class of equity securities are set out below:
ORDINARY SHARES
On a show of hands every member present at a meeting in person, or by proxy, shall have one vote, and upon a poll each share
shall have one vote.
THE NUMBER AND CLASS OF RESTRICTED SECURITIES SUBJECT TO VOLUNTARY ESCROW THAT ARE ON ISSUE
Voluntary Escrow
There are no shares under voluntary escrow.
2025 ANNUAL REPORT — 5G NETWORKS LTD AND ITS CONTROLLED ENTITIES
91
SHAREHOLDER INFORMATION
The 20 Largest Holders of Each Class of Quoted Equity Securities
Ordinary Shares
Number
%
BNP PARIBAS NOMINEES PTY LTD
59,000,941
19.81%
5GN CLOUD PTE LTD
55,000,000
18.47%
CHRIS WRIGHT CYBER PTY LTD
7,294,118
2.45%
CITICORP NOMINEES PTY LIMITED
5,964,696
2.00%
MR XU WANG
5,034,801
1.69%
JMAS PTY LIMITED
4,000,000
1.34%
JONATHAN HORNE
4,000,000
1.34%
MR ALBERT SAYCHUAN CHEOK & MR ERIC VICTOR CHEOK
3,714,018
1.25%
J D MANAGEMENT GROUP PTY LTD
2,628,060
0.88%
ECKERT INVESTMENTS PTY LTD
2,526,666
0.85%
MOLINI INVESTMENTS PTY LTD
2,500,001
0.84%
OR GANGI SERVICES P/L ATF JGANGI BUSINESS TRUST NO2
2,400,000
0.81%
GARY WHITE
1,900,000
0.64%
NZAU INVESTMENTS PTY LTD
1,833,334
0.62%
ALBERT CHEOK
1,800,000
0.60%
MR FRANCIS ANDREW KING & MRS MARGARET SUSAN KING
1,639,170
0.55%
ALBERT CHEOK
1,504,284
0.51%
MS KYLIE LYNETTE NUSKE & MR MATTHEW JAMES COOK
1,500,000
0.50%
MRS MARIA O'CONNOR
1,500,000
0.50%
MR CLINTON BARRY MICHAEL
1,499,491
0.50%
PAC EQUITIES PTY LTD
1,460,204
0.49%
THE DE VRIES FAMILY INVESTMENTS PTY LTD
1,396,315
0.47%
Total
170,096,099
57.11%
Unissued equity securities
Number of options issued: 58,470,000
Securities exchange
The Company is listed on the Australian Securities Exchange.
ABOUT 5G NETWORKS
5G Networks is a licenced telecommunications carrier operating across Australia. Our mission is
to be the partner of choice for unifying a seamless digital experience for our customers across
data connectivity, cloud and data centre services, underpinned by a dedication to expert managed
services.
Digital leadership, people and exceptional customer experience are key foundations to enabling
customers to thrive in a digital world. We are dedicated to providing our customers with a valued and
unique experience, underlined by our vision.
Our culture is centred around people, collaboration and trust, enabling our team to continually
unlock value for our customers through innovation and the expertise to transform digital challenges
into successful business outcome.