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`Annual Report
31 December 2020
E4G Investment Holdings Pty Ltd and Controlled Entities
ACN 614 735 474
Aerison Pty Ltd | www.aerison.com
Contents
2
AERISON AT A GLANCE .................................................................................................................................. 3
DIRECTORS ....................................................................................................................................................... 4
WHO WE ARE .................................................................................................................................................... 5
PERFORMANCE AT A GLANCE ...................................................................................................................... 6
SUMMARY OF 2020 PERFORMANCE ............................................................................................................. 7
DIRECTORS REPORT ....................................................................................................................................... 8
INDEPENDENT AUDITORS REPORT ............................................................................................................ 10
GENERAL INFORMATION .............................................................................................................................. 13
FINANCIAL REPORT ...................................................................................................................................... 14
DIRECTORS' DECLARATION ........................................................................................................................ 46
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AERISON HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
3
E4G Investment Holdings Pty Ltd is the ultimate parent in the group. The
subsidiary Aerison Pty Ltd is the trading entity within the group which
derives income from trading activities.
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Aerison at a Glance
Overview
Aerison is an engineering and construction company
which self-performs engineering, design, fabrication,
installation, maintenance and commissioning for
projects in the mining & minerals, oil & gas and
infrastructure sectors.
Aerison offers turnkey services to asset owners looking
to expand or improve their operations with the
construction of new facilities as well as the
improvement of and maintenance of existing facilities.
History
Established in Perth, Western Australia in 1988, Aerison has grown over the
years from a specialist Environmental Engineering company to a broad
based engineering design and construction company that self-performs
multi-disciplined EPC, engineering and design, construction and
maintenance services to a wide variety of industries and applications across
Australia.
The Company is recognised for its environmental services which includes
studies, compliance testing and customised designed and built solutions that
reduce the impact of industry on the environments.
Aerison Holdings Pty Ltd (parent entity of Aerison Pty Ltd) was acquired by
E4G Investment Holdings Pty Ltd in November 2016.
The business
Aerison’s corporate and operating office is located in West Perth, Western
Australia with a 10,800 square meter fabrication and assembly facility in
Forrestfield, Western Australia The Company currently employs a full-time
workforce of approximately 120 professional, technical, managerial and
support personnel, in addition to approximately 400 directly employed site
construction personnel.
With operations throughout Australia, Aerison is a diversified services
company delivering and maintaining critical assets that sustain and
enhance the environment in which we live.
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Aerison’s skilled workforce, expertise in project management and end-to-
end engineering, is backed by a continuous focus on safety, quality and
delivering to schedule. The success of Aerison has been built on its ability
to provide a quality turnkey service, and this is only possible by having in-
house engineering and design, procurement, project management,
manufacturing, construction, mechanical installation and commissioning
capabilities.
Aerison’s business model focuses on utilising in-house capabilities for the
engineering, design, construction and maintenance of process and non-
process infrastructure for Asset Owners which to date have included large
mining producers, infrastructure and utilities owners.
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
4
Directors
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Giuseppe Leone
CEO & Executive Director (Shareholder)
Giuseppe has a CFO and investment banking
background with 25 years of executive
experience with multinational LSE Listed, ASX
Listed and private companies in the technology,
resources, oil and gas, chemicals and power
sectors, across Australia, SE Asia and the Pacific
Rim .
Daniel Hibbs
COO & Executive Director (Shareholder)
Daniel has more than 20 years of operational
experience in the Australian natural resources
sector, with specific oil and gas and minerals
expertise, having worked for Leighton
Contractors, John Holland and Paladio Group. He
also has significant exposure to projects in the
Pilbara mining region of Western Australia
Strong Asia Pac experience managing growth
from a 1,500 strong workforce to over 10,000
across an entire region.
Daniel has a demonstrable track record of
building strong teams, sound processes and
driving sustainable company growth.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
5
Who we are
Our Purpose
To build a successful and
sustainable business operating with
integrity, fairness and transparency
with our people, customers,
suppliers and the community.
Our Mission
To position Aerison as a leading
multi-disciplined EPC and services
provider enhancing the
performance of our customers by
understanding their needs and
delivering our core services safely,
to the highest quality and to
schedule.
Our Strategy
To operate as One Team, providing
safe, seamless delivery.
Our Values
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INTEGRITY
We are reliable, honest and
accountable.
.
NURTURE
Our people are the
absolute core of our
operation.
SAFETY
Safety is at the forefront of
everything we do.
PERFORMANCE
We always strive to do
things better.
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INNOVATION
We do not accept
ordinary.
RELATIONSHIPS
We always work with our people,
clients and suppliers in a collaborative
and transparent manner.
EXCELLENCE
We are continually
raising the bar.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
6
Performance at a Glance
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E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
7
Summary of 2020 Performance
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Overview
The business continues to achieve double digit year on
year growth across both revenue and earnings. With a
strong tendering pipeline, improving capability and
profitable orderbook going into 2021, another year of
double-digit growth is forecast for 2021.
Revenue for FY20 reached $100.5M up 26% on the
previous period (LY $80.1M), on the back of increasing
demand for Aerison’s specialist services, particularly
with Australia’s major mineral producers. All areas of the
business have experienced growth with a well-diversified
mix between sustaining capital maintenance works and
projects. EBITDA of $10.5M was achieved, up 15% on
the previous period (LY $9.1M) and underpinned by
strong gross margins.
We continue to service existing clients, namely BHP,
RTIO, Newmont Gold, FMG, in a project capacity as well
as under existing Master Service Agreements (MSA).
Having demonstrated our capability over the last two
years, we are well positioned to continue to increase our
services offering and revenues to these and to gain new
clients.
Financial
A strong set of results which positions the business
favourably going into 2021:
• Sales revenue of $100.5M, up 26%
• EBITDA of $10.5M up 15%
• NPBT of $6.7M up 13%
• Net assets of $18.0M, up 34%
• Net cash* of -$2.1M at year end, LY-$2.5M
*Excludes Convertible Notes
Operations
Key achievements in the year include:
• Award of a sustaining Capital MSA, 3 +2 year term,
major Iron Ore Producer .
• Extension of an existing MSA for a further 3 years,
Iron Ore Producer.
• Project award circa $15.0M (potential scope increase
to circa $52.0M) for delivery in 2021.
• Award of an engineering services project, waste to
• Completion of a number of Dust Mitigation Projects
energy, circa $2.5M.
circa $20M.
Safety and wellbeing
Our safety performance continues to improve achieving
1,090 days LTI free with the business continuing its
focus on critical risk controls and behavioural safety. We
continue to invest in frontline leadership training
programs and field support.
People
At year end the business had 534 regular trades and
staff. We continue to focus on staff development and
retention, a key focus as the market tightens across
both blue-collar trades and white-collar.
There were a number of key appointments in the year,
most notably the appointment of a General Manager to
head up the major projects division which is
experiencing growth.
REVENUE ($M)
2020
2019
2018
100.5
80.1
50.5
NET CASH ($M)
2020
2019
2018
-2.1
-2.5
-2.0
EBITDA ($M)
2020
2019
2018
NPBT ($M)
2020
2019
2018
10.5
9.1
3.5
6.7
5.9
2.0
NET ASSETS ($M)
2020
2019
2018
18.0
13.5
9.9
Man hours
2020
2019
2018
972,714
597,985
443,553
Pipeline, markets and growth
Our order book remains strong with circa $118M
secured as year end for delivery in 2021 (LY$79.4M)
with multiple opportunities expected to be awarded in
H1 2021. The tendering pipeline remains strong with
circa $900M+ of opportunities available to Aerison. It is
expected that circa 50% of revenues in 2021 will be
derived from term contracts and repeat business.
Blue-chip client base
We are pleased to report that the majority of our
revenues continue to be derived direct from asset
owners and blue-chip clients. Although there will be a
large focus on iron ore over the next few years the
business continues to diversify with awards expected in
oil and gas and infrastructure, in particular in rail and
road tunnel infrastructure.
On behalf of the Board, I would like to take this
opportunity to thank our employees, customers and
shareholders for their ongoing loyalty and support as
we progress on our growth path.
Daniel Hibbs
Executive Chairman and Chief Operating Officer
E4G Investment Holdings Pty Limited ABN 77 614 735 474
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
8
Directors Report
The directors present their report, together with the financial statements, on the consolidated entity (referred
to hereafter as the ‘consolidated entity’) consisting of E4G Investment Holdings Pty Ltd (referred to hereafter
as “the Company” or ‘parent entity’) and its controlled entities at the end of, or during, the financial year
ended 31 December 2020.
Directors
The names of the directors in office at any time during, or since the end of, the year are:
Giuseppe Leone
Daniel Hibbs
Michael Fennell
Min Lu (Resigned 11 March 2020)
Qiudong Qiao (Appointed 11 March 2020)
Directors have been in office since the beginning of the year to the date of this report unless otherwise
stated.
Review of Operations
The profit for the consolidated entity after providing for income tax and non-controlling interest amounted to
$5,051,046 (2019: $4,115,639).
Dividends
Dividends paid during the year was $576,000 (2019: $576,000).
Principal activities
The consolidated entity’s primary activity is engineering and construction and self-performs engineering,
design, fabrication, installation, maintenance and commissioning for projects in the mining & minerals, oil &
gas and infrastructure sectors.
No significant change in the nature of these activities occurred during the year.
Significant changes in the state of affairs
There were no significant changes in the state of affairs of the consolidated entity during the financial year.
Events subsequent to the end of the reporting date
The impact of the Coronavirus (COVID-19) pandemic is ongoing. it is not practicable to estimate the potential
impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on
measures imposed by the Australian Federal Government or Western Australian State Government.
No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may
significantly affect the consolidated entity's operations, the results of those operations, or the consolidated
entity's state of affairs in future financial years.
Future development, prospects and business strategies
Likely developments in the operations of the consolidated entity and the expected results of those operations
in future financial years have not been included in this report as the inclusion of such information is likely to
result in unreasonable prejudice to the consolidated entity.
Environmental issues
The consolidated entity is subject to environmental regulations under a law of the Commonwealth or of a
state or territory of Australia. The consolidated entity is not aware of any breach of any environmental
regulations.
Options
No options over issued shares or interests in E4G Investment Holdings Pty Ltd were granted during or since
the end of the financial year and there were no options outstanding at the date of this report.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
9
Indemnification of auditor
The company has not, during or since the end of the financial year, indemnified or agreed to indemnify the
auditor of the company against a liability incurred by the auditor. During the year, the company has not paid a
premium in respect of a contract to insure the auditor of the company.
Indemnities given and insurance premiums paid to officers
During the year, the company paid a premium to insure officers of the company. The officers of the
company covered by the insurance policy include all directors.
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 company, 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
company.
Details of the amount of the premium paid in respect of the insurance policies are not disclosed as such
disclosure is prohibited under the terms of the contract.
Proceedings on behalf of the company
No person has applied for leave of Court under section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the company or 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 any part of those proceedings.
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The company was not a party to any such proceedings during the year.
Auditor’s independence declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act
2001 is included within the financial report.
This director’s report is signed in accordance with a resolution of the Board of Directors, pursuant to section
298(2)(a) of the Corporation Act 2001.
Giuseppe Leone
CEO and Executive Director
Dated this 9th day of March 2021
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E4G Investment Holdings Pty Limited ABN 77 614 735 474
RSM Australia Partners
Level 32, Exchange Tower
2 The Esplanade Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 (0) 8 9261 9100
F +61 (0) 8 9261 9111
www.rsm.com.au
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
E4G INVESTMENT HOLDINGS PTY LIMITED
Opinion
We have audited the financial report of E4G Investment Holdings Pty Limited (the Company) and its subsidiaries
(the Group), which comprises the consolidated statement of financial position as at 31 December 2020, the
consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes
in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies, and the directors' declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
(i) giving a true and fair view of the Group’s financial position as at 31 December 2020 and of its financial
performance for the year ended on that date; and
(ii) 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 (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 confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor's
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
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THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent
accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
Other Information
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 31 December 2020 but does not include the financial report and
the auditor's report thereon.
Our opinion on the financial report does not cover the other information and accordingly 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 the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group 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/auditors_responsibilities/ar4.pdf. This
description forms part of our auditor's report.
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RSM AUSTRALIA PARTNERS
Perth, WA
Dated: 9 March 2021
TUTU PHONG
Partner
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RSM Australia Partners
Level 32, Exchange Tower
2 The Esplanade Perth WA 6000
GPO Box R1253 Perth WA 6844
T +61 (0) 8 9261 9100
F +61 (0) 8 9261 9111
www.rsm.com.au
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of E4G Investment Holdings Pty Limited for the year ended 31
December 2020, I declare that, to the best of my knowledge and belief, there have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
any applicable code of professional conduct in relation to the audit.
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RSM AUSTRALIA PARTNERS
TUTU PHONG
Partner
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Perth, WA
Dated: 9 March 2021
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THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the RSM network is an independent
accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
13
General Information
The financial statements cover E4G Investment Holdings Pty Ltd as a consolidated entity consisting of E4G
Investment Holdings Pty Ltd and the entities it controlled at the end of, or during, the year. The financial
statements are presented in Australian dollars, which is E4G Investment Holdings Pty Ltd’s functional and
presentation currency.
E4G Investment Holdings Pty Ltd is a company limited by shares, incorporated and domiciled in Australia. Its
registered office and principal place of business are:
Registered office
60 Havelock Street
West Perth WA 6005
Principal place of business
1st floor, 56 Ord Street
West Perth WA 6005
A description of the nature of the consolidated entity's operations and its principal activities are included in
the directors' report, which is not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of directors, on the ninth
day of March 2021. The directors have the power to amend and reissue the financial statements.
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E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
14
Financial Report
Statement of profit or loss and other comprehensive income
For the year ended 31 December 2020
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Revenue
Cost of sales
Gross profit
Other income
Administration expenses
Depreciation and amortisation expense
Finance costs
Marketing expenses
Occupancy expenses
Other expenses
Profit before income tax
Income tax expense
Profit after income tax
Other comprehensive income
Total comprehensive income for the year
Note
Consolidated Entity
2020
$
2019
$
3
3
4
4
5
100,526,414
80,058,696
(86,668,903)
(68,521,219)
13,857,511
11,537,477
10,560
(1,326,850)
(2,052,801)
(1,712,031)
(121,163)
(440,944)
(1,514,039)
6,700,243
(1,649,197)
13,220
(1,002,536)
(1,836,525)
(1,385,833)
(153,091)
(338,922)
(920,364)
5,913,426
(1,797,787)
5,051,046
4,115,639
-
-
5,051,046
4,115,639
The accompanying notes form part of these financial statements.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
15
Statement of financial position
As at 31 December 2020
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Current assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total current assets
Non-current assets
Property, plant and equipment
Right of use assets
Intangible assets
Deferred tax assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Borrowings
Lease liabilities
Employee benefits
Income tax
Total current liabilities
Non-current liabilities
Lease Liabilities
Employee benefits
Deferred tax liabilities
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserve
Retained earnings
Total equity
Note
Consolidated Entity
2020
$
2019
$
7
8
9
10
11
12
5
13
14
15
16
17
15
16
5
18
20
7,754,444
9,509,555
37,582,372
32,010,779
1,082,927
635,918
46,419,743
42,156,252
2,391,970
2,692,492
11,011
1,286,054
6,381,527
2,453,866
301,661
11,011
2,202,303
4,968,841
52,801,270
47,125,093
14,437,142
13,672,920
664,551
3,002,714
667,290
16,785,920
14,459,139
270,135
1,919,657
-
32,444,617
33,434,851
2,106,421
58,042
164,954
62,217
76,040
99,295
2,329,417
237,552
34,774,034
33,672,403
18,027,236
13,452,690
3,328,647
99,500
3,328,647
-
14,599,089
10,124,043
18,027,236
13,452,690
The accompanying notes form part of these financial statements.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
16
Statement of changes in equity
For the year ended 31 December 2020
Consolidated
Balance at 1 January 2019
Profit after income tax expense for the year
Other comprehensive income for the year,
net of tax
Total comprehensive income for the year
Transactions with owners in their capacity as
owners:
Contributions of equity, net of transaction costs
(note 18)
Dividends paid (note 19)
Issued
Capital
$
Reserves
Retained
Total Equity
$
Profits
$
$
3,328,647
-
6,584,404
9,913,051
-
-
-
-
-
-
4,115,639
4,115,639
-
-
-
-
-
-
4,115,639
4,115,639
-
-
(576,000)
(576,000)
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Balance at 31 December 2019
3,328,647
- 10,124,043 13,452,690
Consolidated
Balance at 1 January 2020
Profit after income tax expense for the year
Other comprehensive income for the year, net of
tax
Total comprehensive income for the year
Transactions with owners in their capacity as
owners:
Share based payments issued during the year
(note 20)
Dividends paid (note 19)
Balance at 31 December 2020
Issued
Capital
$
Reserves
Retained
Total Equity
$
Profits
$
$
3,328,647
- 10,124,043 13,452,690
-
-
-
-
-
-
5,051,046
5,051,046
-
-
-
-
5,051,046
5,051,046
99,500
-
99,500
-
(576,000)
(576,000)
3,328,647
99,500
14,599,089 18,027,236
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The accompanying notes form part of these financial statements.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Statement of cash flows
For the year ended 31 December 2020
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Finance costs
Income tax paid
Note
Consolidated Entity
2020
$
2019
$
96,230,105
73,417,437
(93,024,895)
(70,761,370)
10,291
14,785
(1,703,160)
(1,314,857)
-
-
Net cash generated from operating activities
28
1,512,341
1,355,995
Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
(372,960)
-
(587,125)
62,698
Net cash used in investing activities
(372,960)
(524,427)
Cash flows from financing activities
Repayment of short-term borrowings
Proceeds from short-term borrowings
Dividends declared and paid
Repayment of lease liabilities
Proceeds from issue of convertible notes
Repayment of convertible notes
Repayment of financing costs
19
(2,133,893)
-
(576,000)
-
8,296,867
(576,000)
(1,111,760)
(1,055,773)
3,155,000
(2,227,839)
-
485,000
(702,800)
(25,205)
Net cash (used in) / provided by financing activities
(2,894,492)
6,422,089
Net change in cash held
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
7
(1,755,111)
9,509,555
7,754,444
7,253,657
2,255,898
9,509,555
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The accompanying notes form part of these financial statements.
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
Note 1.
Statement of significant accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out below.
These policies have been consistently applied to all the years presented, unless otherwise stated.
New and amended accounting standards and interpretations adopted
The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations
issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting
period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been
early adopted.
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting
Standards and 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 as issued by the International Accounting Standards Board
('IASB').
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where
applicable, the revaluation of financial assets and liabilities at fair value through profit or loss, financial assets
at fair value through other comprehensive income, investment properties, certain classes of property, plant
and equipment and derivative financial instruments.
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of applying the consolidated entity's
accounting policies. The areas involving a higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the financial statements, are disclosed in note 2.
Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the
consolidated entity only. Supplementary information about the parent entity is disclosed in note 24.
Principles of consolidation
The consolidated financial statements incorporate the assets, liabilities of all subsidiaries of E4G Investment
Holdings Pty Ltd (‘company’ or ‘parent entity’) as at 31 December 2020 and results of all subsidiaries for the
year then ended. E4G Investment Holdings Pty Ltd and its subsidiaries together are referred to in these
financial statements as the ‘consolidated entity’.
Subsidiaries are all those entities over which the consolidated entity has control. The consolidated entity
controls an entity when the consolidated entity 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
consolidated entity. They are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the
consolidated entity 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 consolidated entity.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. 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.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
19
Notes to the financial statements
31 December 2020
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Note 1. Statement of significant accounting policies continued
Non-controlling interest in the results and equity of subsidiaries are shown separately in the statement of
profit or loss and other comprehensive income, statement of financial position and statement of changes in
equity of the consolidated entity. Losses incurred by the consolidated entity are attributed to the non-
controlling interest in full, even if that results in a deficit balance.
Where the consolidated entity 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 consolidated entity 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 acquiree 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 acquiree's identifiable net
assets. All acquisition costs are expensed as incurred to profit or loss.
On the acquisition of a business, the consolidated entity assesses the financial assets acquired and liabilities
assumed for appropriate classification and designation in accordance with the contractual terms, economic
conditions, the consolidated entity's operating or accounting policies and other pertinent conditions in
existence at the acquisition-date.
Where the business combination is achieved in stages, the consolidated entity 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 the 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 acquirer.
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. 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.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
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Note 1. Statement of significant accounting policies continued
Revenue recognition
The consolidated entity recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the consolidated entity is
expected to be entitled in exchange for transferring goods or services to a customer. For each contract with
a customer, the consolidated entity : identifies the contract with a customer; identifies the performance
obligations in the contract; determines the transaction price which takes into account estimates of variable
consideration and the time value of money; allocates the transaction price to the separate performance
obligations on the basis of the relative stand-alone selling price of each distinct good or service to be
delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that
depicts the transfer to the customer of the goods or services promised.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer
such as discounts, rebates and refunds, any potential bonuses receivable from the customer and any other
contingent events. Such estimates are determined using either the 'expected value' or 'most likely amount'
method. The measurement of variable consideration is subject to a constraining principle whereby revenue
will only be recognised to the extent that it is highly probable that a significant reversal in the amount of
cumulative revenue recognised will not occur. The measurement constraint continues until the uncertainty
associated with the variable consideration is subsequently resolved. Amounts received that are subject to
the constraining principle are initially recognised as deferred revenue in the form of a separate refund
liability.
Sale of goods
Revenue from the sale of goods is recognised at the point in time when the customer obtains control of the
goods, which is generally at the time of delivery.
Rendering of services
Revenue from a contract to provide services is recognised over time as the services are rendered based on
either a fixed price or an hourly rate.
Interest
Interest revenue is recognised as interest accrues using 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.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
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 the changes in deferred tax assets and
liabilities attributable to temporary differences, unused tax losses and the adjustment recognised for prior
periods, where applicable’
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be
applied 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
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
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Note 1. Statement of significant accounting policies continued
• 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 at 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.
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.
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.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current
classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed
in the consolidated entity's normal operating cycle; it is held primarily for the purpose of trading; it is expected
to be realised within 12 months after the reporting period; or the asset is cash or cash equivalent unless
restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period.
All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the consolidated entity's normal
operating cycle; it is held primarily for the purpose of trading; it is due to be settled within 12 months after the
reporting period; or there is no unconditional right to defer the settlement of the liability for at least 12 months
after the reporting period. All other liabilities are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
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 in current liabilities on the statement of financial position.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
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Note 1. Statement of significant accounting policies continued
Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using
the effective interest method, less any allowance for expected credit losses. Trade receivables are generally
due for settlement within 30 days.
The consolidated entity has applied the simplified approach to measuring expected credit losses, which uses
a lifetime expected loss allowance. To measure the expected credit losses, trade receivables have been
grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
Contract assets
Contract assets are recognised when the consolidated entity has transferred goods or services to the
customer but where the consolidated entity is yet to establish an unconditional right to consideration.
Contract assets are treated as financial assets for impairment purposes.
Inventories
Raw materials, work in progress and finished goods are stated at the lower of cost and net realisable value
on a 'weighted average cost' basis. Cost comprises of direct materials and delivery costs, direct labour,
import duties and other taxes, an appropriate proportion of variable and fixed overhead expenditure based
on normal operating capacity, and, where applicable, transfers from cash flow hedging reserves in equity.
Costs of purchased inventory are determined after deducting rebates and discounts received or receivable.
Stock in transit is stated at the lower of cost and net realisable value. Cost comprises of purchase and
delivery costs, net of rebates and discounts received or receivable.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs
of completion and the estimated costs necessary to make the sale.
Property, plant and equipment
Each class of property, plant and equipment is carried at cost less, where applicable, any accumulated
depreciation.
Plant and equipment
Plant and equipment are measured at cost less depreciation and impairment losses.
The cost of fixed assets constructed within the consolidated entity includes the cost of materials, direct
labour, borrowing costs and an appropriate proportion of fixed and variable overheads. Subsequent costs
are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item will flow to the consolidated entity and the
cost of the item can be measured reliably. All other repairs and maintenance are charged to profit or loss
during the financial period in which they are incurred.
Depreciation
The depreciable amount of all fixed assets including building and capitalised leased assets, but excluding
freehold land, is depreciated on a diminishing value basis over their useful lives to the consolidated entity
commencing from the time the asset is held ready for use. Leased assets are depreciated over the shorter of
either the unexpired year of the lease or the estimated useful lives of the assets. The depreciation rates
used for each class of depreciable assets are:
Class of fixed asset
Depreciation rate
Plant & machinery, fixtures, fittings & office equip
Motor vehicles
Computer equipment and software
Leasehold improvements
5% - 25%
20%
10% - 40%
5% - 15%
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
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Note 1. Statement of significant accounting policies continued
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting
period date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying
amount is greater than its estimated recoverable amount.
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 consolidated entity. Gains and losses between the carrying amount and the disposal proceeds
are taken to profit or loss. Any revaluation surplus reserve relating to the item disposed of is transferred
directly to retained profits.
Intangible assets
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at
their fair value at the date of the acquisition. Intangible assets acquired separately are initially recognised at
cost. Indefinite life intangible assets are not amortised and are subsequently measured at cost less any
impairment. Finite life intangible assets are subsequently measured at cost less amortisation and any
impairment. The gains or losses recognised in profit or loss arising from the derecognition of intangible
assets are measured as the difference between net disposal proceeds and the carrying amount of the
intangible asset. The method and useful lives of finite life intangible assets are reviewed annually. Changes
in the expected pattern of consumption or useful life are accounted for prospectively by changing the
amortisation method or period.
Software
Significant costs associated with software are deferred and amortised on a straight-line basis over the period
of their expected benefit, being their finite life.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured
at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease
payment made at or before the commencement date net of any lease incentives received, any initial direct
costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be
incurred for dismantling and removing the underlying asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the
estimated useful life of the asset, whichever is the shorter. Where the consolidated entity expects to obtain
ownership of the leased asset at the end of the lease term, the depreciation is over its estimated useful life.
Right-of-use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.
The consolidated entity has elected not to recognise a right-of-use asset and corresponding lease liability for
short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these
assets are expensed to profit or loss as incurred.
Lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised
at the present value of the lease payments to be made over the term of the lease, discounted using the
interest rate implicit in the lease or, if that rate cannot be readily determined, the consolidated entity's
incremental borrowing rate. Lease payments comprise of fixed payments less any lease incentives
receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid under
residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably
certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend
on an index or a rate are expensed in the period in which they are incurred.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
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Note 1. Statement of significant accounting policies continued
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts
are remeasured if there is a change in the following: future lease payments arising from a change in an index
or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties.
When a lease liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to
profit or loss if the carrying amount of the right-of-use asset is fully written down.
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.
Trade and other payables
Trade and other payables represent the liabilities for goods and services received by the consolidated entity
that remain unpaid at the end of the reporting period. The balance is recognised as a current liability with the
amounts normally paid within 30 days of recognition of the liability.
Contract liabilities
Contract liabilities represent the consolidated entity's obligation to transfer goods or services to a customer
and are recognised when a customer pays consideration, or when the consolidated entity recognises a
receivable to reflect its unconditional right to consideration (whichever is earlier) before the consolidated
entity has transferred the goods or services to the customer.
Refund liabilities
Refund liabilities are recognised where the consolidated entity receives consideration from a customer and
expects to refund some, or all, of that consideration to the customer. A refund liability is measured at the
amount of consideration received or receivable for which the consolidated entity does not expect to be
entitled and is updated at the end of each reporting period for changes in circumstances. Historical data is
used across product lines to estimate such returns at the time of sale based on an expected value
methodology.
Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of
transaction costs. They are subsequently measured at amortised cost using the effective interest method.
The component of the convertible notes that exhibits characteristics of a liability is recognised as a liability in
the statement of financial position, net of transaction costs.
Finance costs
Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are
expensed in the period in which they are incurred.
Employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave
expected to be settled wholly within 12 months of the reporting date are measured at the amounts expected
to be paid when the liabilities are settled.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
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Note 1. Statement of significant accounting policies continued
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months of the
reporting date are measured at 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
corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future
cash outflows.
Defined contribution superannuation expense
Contributions to defined contribution superannuation plans are expensed in the period in which they are
incurred.
Provisions
Provisions are recognised when the consolidated entity has a legal or constructive obligation, as a result of
past events, for which it is probable that an outflow of economic benefits will result and that outflow can be
reliably measured. Provisions are measured using the best estimate of amounts required to settle the
obligation at the end of the reporting year.
Fair value measurement
When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure
purposes, the fair value is based on 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; and assumes that
the transaction will take place either: in the principal market; or in the absence of a principal market, in the
most advantageous market.
Fair value is measured using the assumptions that market participants would use when pricing the asset or
liability, assuming they act in their economic best interests. For non-financial assets, the fair value
measurement is based on its highest and best use. Valuation techniques that are appropriate in the
circumstances and for which sufficient data are available to measure fair value, are used, maximising the
use of relevant observable inputs and minimising the use of unobservable inputs.
Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that
reflects the significance of the inputs used in making the measurements. Classifications are reviewed at
each reporting date and transfers between levels are determined based on a reassessment of the lowest
level of input that is significant to the fair value measurement.
For recurring and non-recurring fair value measurements, external valuers may be used when internal
expertise is either not available or when the valuation is deemed to be significant. External valuers are
selected based on market knowledge and reputation. Where there is a significant change in fair value of an
asset or liability from one period to another, an analysis is undertaken, which includes a verification of the
major inputs applied in the latest valuation and a comparison, where applicable, with external sources of
data.
Government grants
Government grants relating to costs are deferred and recognised in profit or loss over the period necessary
to match them with the costs that they are intended to compensate.
Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
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.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
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Note 1. Statement of significant accounting policies continued
Dividends
Dividends are recognised when declared during the financial year and no longer at the discretion of the
company.
New accounting standards and interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not
yet mandatory, have not been early adopted by the consolidated entity for the annual reporting period ended
31 December 2020. The consolidated entity's assessment of the impact of these new or amended
Accounting Standards and Interpretations, most relevant to the consolidated entity, are set out below.
Conceptual Framework for Financial Reporting (Conceptual Framework)
The revised Conceptual Framework is applicable to annual reporting periods beginning on or after 1 July
2021 and early adoption is permitted. The Conceptual Framework contains new definition and recognition
criteria as well as new guidance on measurement that affects several Accounting Standards. Where the
consolidated entity has relied on the existing framework in determining its accounting policies for
transactions, events or conditions that are not otherwise dealt with under the Australian Accounting
Standards, the consolidated entity may need to review such policies under the revised framework. At this
time, the application of the Conceptual Framework is not expected to have a material impact on the
consolidated entity's financial statements.
Note 2.
Critical accounting estimates and judgments
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. 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 (refer to the respective notes) within the next
financial year are discussed below.
Revenue recognised over time
The consolidated entity has revenue where the performance obligation is satisfied over time. Revenue is
recognised over time by measuring the progress toward complete satisfaction of that performance obligation.
A single method is applied consistently for measuring progress for each performance obligation satisfied
over time. Judgment is required when selecting a method (output or input methods) for measuring progress
toward complete satisfaction of a performance obligation. Assessing the satisfaction of performance
obligations over time requires judgment and the consideration of many criteria that should be met to qualify.
Events and circumstances frequently do not occur as expected. Even if the events anticipated under the
assumptions occur, actual results are still likely to be different from the estimates since other anticipated
events frequently do not occur as expected and the variation may be material
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a degree of estimation and judgement. It is
based on the lifetime expected credit loss, grouped based on days overdue, and makes assumptions to
allocate an overall expected credit loss rate for each group. These assumptions include recent sales
experience and historical collection rates.
Estimation of useful lives of assets
The consolidated entity 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.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
27
Notes to the financial statements
31 December 2020
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Note 2. Critical accounting estimates and judgments continued
Impairment of non-financial assets other than goodwill and other indefinite life intangible assets
The consolidated entity 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 consolidated entity 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.
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only if the consolidated entity
considers it is probable that future taxable amounts will be available to utilise those temporary differences
and losses.
Employee benefits provision
As discussed in note 1, the liability for employee benefits expected to be settled more than 12 months from
the reporting date are 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 value of the liability,
estimates of attrition rates and pay increases through promotion and inflation have been taken into account.
.
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E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
Disaggregation of revenue
The disaggregation of revenue from contracts with customers is follows:
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Note 3.
Revenue and other income
Sales revenue:
Provision of services and sale of goods
Other income (charges):
Interest income
Other revenue (charges)
Total other income
Sectors
Natural resources
Non-mining infrastructure
Utilities
Geographical regions
Western Australia
Queensland
Timing of revenue recognition
Goods/services transferred over time
Note 4.
Expenses
Consolidated Entity
2020
$
2019
$
100,526,414
80,058,696
100,526,414
80,058,696
10,291
269
10,560
14,785
(1,565)
13,220
Consolidated Entity
2020
$
2019
$
93,740,372
74,911,060
1,566,109
5,219,933
1,540,432
3,607,204
100,526,414
80,058,696
100,526,414
80,056,757
-
1,939
100,526,414
80,058,696
100,526,414
100,526,414
80,058,696
80,058,696
Consolidated Entity
2020
$
2019
$
Profit before income tax from continuing operations includes
the following specific expenses:
Cost of sales
Cost of sales
86,668,903
68,521,219
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
29
Notes to the financial statements
31 December 2020
Plant & machinery, fixtures, fittings & office equipment
Note 4. Expenses continued
Depreciation
Leasehold improvements
Motor vehicles
Computer equipment & software
Right of use assets
Total depreciation
Finance costs
Finance costs expensed
Superannuation expense
Note 5.
Income tax expense
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Interest and finance charges on borrowings
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Interest and finance charges on lease liabilities
a) The components of tax expense comprise:
Current tax expense
Current year
Deferred tax
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Origination and reversal of temporary differences
Under provision in respect of prior years
Accounting profit before tax
Accounting profit before tax:
Prima facie tax payable on profit before income tax at
30% (2019: 30%):
Tax effect of:
- Non-allowable items
- Business blackhole expenditure
- Under provision in respect of prior years
Consolidated Entity
2020
$
32,732
83,951
495,685
491,146
949,287
2019
$
187,074
119,584
297,752
388,124
843,991
2,052,801
1,836,525
1,510,977
201,054
1,318,968
66,865
1,712,031
1,385,833
3,636,744
2,385,956
Consolidated Entity
2020
$
2019
$
667,290
-
1,320,939
(339,032)
1,649,197
1,776,960
20,827
1,797,787
6,700,243
5,913,426
2,010,073
1,774,028
13,040
-
(373,916)
10,334
(7,402)
20,827
Income tax expense (benefit)
1,649,197
1,797,787
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
30
Notes to the financial statements
31 December 2020
Note 5. Income tax expense continued
Consolidated Entity
Non-current
1 January
2020
$
Recognised
in income
$
Recognised
in equity
$
31 December
2020
$
Deferred tax assets and liabilities:
Other assets
Property, plant and equipment
Employee benefits
Provisions
Other
Unused tax losses
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45,037
(17,063)
232,965
129,711
305
(4,368)
(124,997)
470,963
381,777
6,770
1,712,053
(1,712,053)
2,103,008
(981,908)
Recognised as:
Deferred tax assets
Deferred tax liabilities
2,202,303
(99,295)
2,103,008
Consolidated Entity
Non-current
1 January
2019
$
Recognised
in income
$
Recognised
in equity
$
31 December
2019
$
Deferred tax assets and liabilities:
Other assets
Property, plant and equipment
Employee benefits
Provisions
Other
Unused tax losses
28,875
(82,523)
165,514
50,444
(31,528)
16,162
65,460
67,451
79,267
31,833
3,770,011
(2,057,960)
3,900,793
(1,797,787)
Recognised as:
Deferred tax assets
Deferred tax liabilities
4,029,844
(129,051)
3,900,793
-
-
-
-
-
-
-
40,669
(142,060)
703,928
511,488
7,075
-
1,121,100
1,286,054
(164,954)
1,121,100
-
-
-
-
-
-
-
45,037
(17,063)
232,965
129,711
305
1,712,053
2,103,008
2,202,303
(99,295)
2,103,008
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
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Note 6.
Auditors remuneration
Remuneration of the auditor for:
- Auditing the financial statements
- Tax compliance services
-
-
IT support services
IT equipment procurement
Total remuneration of the auditor
Note 7.
Cash and cash equivalents
Cash at banks and in hand
Short-term bank deposits
Total cash and cash eqivalents
Reconciliation of cash
Cash at the end of the financial year as shown in the
statement of cash flows is reconciled to items in the
statement of financial position as follows:
Cash and cash equivalents
Note 8.
Trade and other receivables
Trade receivables
Other receivables – contract assets
Accrued revenue – contract assets
Total current trade and other receivables
Consolidated Entity
2020
$
87,000
40,021
96,580
372,915
596,516
2019
$
87,000
13,500
34,477
206,161
341,138
Consolidated Entity
2020
$
2,722,192
5,032,252
7,754,444
2019
$
5,586,837
3,922,718
9,509,555
7,754,444
9,509,555
Consolidated Entity
2020
$
2019
$
12,573,480
21,271,451
9,951,738
15,057,154
1,777,426
8,961,902
37,582,372
32,010,779
A fixed and floating charge over the short-term bank deposits is held as part of the guarantee facility
provided.
Allowance for expected credit losses
The consolidated entity has not recognised any losses in the profit or loss in respect of the expected credit
losses for the year ended 31 December 2020.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
32
Notes to the financial statements
31 December 2020
Note 8. Trade and other receivables continued
Other receivables – contract assets
Reconciliation of the written down values at the beginning and end of the Current and previous financial year
are set out below:
Opening balance
Additions
Transfer to income statement
Transfer to property, plant and equipment
Closing balance
1,777,426
9,951,738
(1,056,023)
(721,403)
31,337
1,777,426
(31,337)
-
9,951,738
1,777,426
Accrued revenue – contract assets
Reconciliation of the written down values at the beginning and end of the Current and previous financial year
are set out below:
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Opening balance
Additions
Transfer to trade receivables
Closing balance
Note 9.
Other assets
Prepayments
Inventory
Total other assets
Note 10.
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Property, plant and equipment
Plant and equipment
At cost
Accumulated depreciation
Total plant and equipment
8,961,902
14,135,247
(8,039,995)
4,206,072
8,961,902
(4,206,072)
15,057,154
8,961,902
Consolidated Entity
2020
$
575,927
507,000
1,082,927
2019
$
495,918
140,000
635,918
Consolidated Entity
2020
$
2019
$
7,485,419
8,181,065
(5,093,449)
(5,727,199)
2,391,970
2,453,866
E4G Investment Holdings Pty Limited ABN 77 614 735 474
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
33
Notes to the financial statements
31 December 2020
Note 10. Property, plant and equipment continued
Leasehold
Improvements
Motor Vehicles Comp. Equip &
Software
Consolidated
$
$
$
Plant & Mach.
Fixt & Office
Equip
$
Total
$
Balance at 1 January 2019
Additions
Transfers to right-of-use
Depreciation expense
Balance at 31 December
2019
Additions
Disposals
Depreciation expense
Transfers from Other
Receivables
Transfers
Balance at 31 December
2020
275,779
527,203
1,134,272
990,986
2,928,240
-
-
-
342,775
244,350
587,125
(65,219)
(2,682)
(1,064)
(68,965)
(187,074)
(119,584)
(297,752)
(388,124)
(992,534 )
88,705
342,400
1,176,613
846,148
2,453,866
145,296
(1,578)
(32,732)
77,273
(118)
(83,951)
25,911
124,480
(15,741) (35,308)
(491,146)
(495,685)
372,960
(52,745)
(1,103,514)
-
-
-
-
91,854
629,549
721,403
38,740
(38,740)
-
199,691
335,604
920,261
936,414
2,391,970
Note 11.
Right of assets
Land & building right-of-use
less Accumulated depreciation
Consolidated Entity
2020
$
3,479,378
(786,886)
2,692,492
2019
$
1,239,679
(938,018)
301,661
Additions to the right to use assets during the year were $3,550,381.
The consolidated entity leases land and buildings for its offices and workshop facilities under agreements of
between one to six years with, in some cases, options to extend. The leases have various escalation
clauses. On renewal, the terms of the leases are renegotiated. The consolidated entity also leases motor
vehicles under agreements of between three to five years.
Note 12.
Intangible assets
Non-current
Software licenses
Total intangible assets
Consolidated Entity
2020
$
11,011
11,011
2019
$
11,011
11,011
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
34
Notes to the financial statements
31 December 2020
All amounts are short term and the carrying values are considered to be a reasonable approximation of fair
value.
Deferred income – contract liabilities
Reconciliation of the written down values at the beginning and end of the current and previous financial year
are set out below:
Consolidated Entity
2020
$
8,094,779
4,840,611
1,501,752
-
2019
$
7,691,065
8,099,892
11,041
983,922
14,437,142
16,785,920
11,041
1,501,752
(11,041)
1,501,752
265,990
11,041
(265,990)
11,041
Consolidated Entity
2020
$
2019
$
9,728,705
11,871,258
120,286
3,823,929
111,626
2,476,255
13,672,920
14,459,139
Note 13.
Trade and other payables
Current
Trade payables
Sundry payables and accrued expenses
Deferred income – contract liabilities
Payable to vendors - conditional
Total current trade and other payables
Opening balance
Additions
Transfer to sales revenue
Closing balance
Note 14.
Borrowings
Current
Commonwealth Bank of Australia
Insurance premium funding (IPF) facility
Convertible notes
Total Current Borrowings
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Commonwealth Bank of Australia
At year end the Commonwealth Bank facility was made up as follows:
a) Bank guarantee facility with a limit of $8.0M
b) Trade debtor financing facility with a limit of $15.0M
c) Overdraft facility with a limit of $1.5M (temporarily increased to $4.0M at year end)
Subsequent to year end, the Commonwealth Bank facility was renegotiated with the limits increased as
follows and leasing facility added:
a) Bank guarantee facility with a limit of $16.0M
b) Trade debtor financing facility with a limit of $15.0M
c) Overdraft facility with a limit of $5.0M
d) Leasing facility of $5.0M
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
35
Notes to the financial statements
31 December 2020
Consolidated Entity
2020
$
2019
$
3,900,000
(83,571)
2,160,000
(34,346)
7,500 350,601
3,823,929
2,476,255
2,476,255
3,350,000
(1,610,000)
(195,000)
145,775
274,738
(617,839)
3,823,929
2,341,201
500,000
(647,000)
(15,000)
54,963
242,091
0
2,476,255
Note 14. Borrowings continued
Convertible Notes
3,900,000 (2019: 2,160,000) convertible notes
Note issue costs
Redemption premium
At the beginning of reporting period
Notes issued
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Note issue cost
Note issue cost amortised
Redemption premium
Redemption premium paid
At reporting date
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During the year, convertible notes were issued on 7 September 2020. The convertible notes are convertible
into ordinary shares in the Parent entity under certain conditions and are an unsecured obligation of the
Parent entity that rank pari-passu with all other unsecured indebtedness of the Parent. The notes bear
interest and have a principal amount of and an issue price of $1.00. In the prior year, convertible notes were
issued under the same terms.
Financing arrangements
Commonwealth Bank of Australia Facilities
Used at the reporting date
Unused at the reporting date
Total Facility Limit
Consolidated Entity
2020
$
2019
$
17,425,915
18,006,300
9,574,085
6,493,700
27,000,000
24,500,000
Used amount at reporting date (Commonwealth Bank of Australia) is comprised of $9,728,705 relating to the
trade financing facility and $7,697,210 relating to the bank guarantee facility (included as contingent
liabilities). The overdraft facility was unused at reporting date with the limit temporarily increased to
$4,000,000 at year end.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
36
Notes to the financial statements
31 December 2020
Assets pledged as security
The leases are secured by term deposits and security over the underlying leased assets. Refer to note 21 for
further information on financial instruments and financial arrangements.
Consolidated Entity
2020
$
2019
$
664,551
270,135
2,106,421
62,217
Consolidated Entity
2020
$
1,570,732
461,640
970,342
2019
$
907,230
440,299
572,128
3,002,714
1,919,657
58,042
76,040
Note 15.
Lease liabilities
Current
Right-of-use asset lease liabilities
Non-current
Right-of-use asset lease liabilities
Note 16.
Employee benefits
Current
Annual leave provision
Long service leave provision
Other employment related payables and provisions
Total current employee benefits
Non-current
Long service leave provision
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The current portion of these liabilities represents the consolidated entity’s obligations to which the employee
has a current legal entitlement. These liabilities arise mainly from accrued annual leave and long service
leave entitlements at reporting date.
A provision has been recognised for employee benefits relating to long service leave for employees. In
calculating the present value of future cash flows in respect of long service leave, the probability of long
service leave being taken is based upon historical data. The measurement and recognition criteria for
employee benefits are described note 1.
Note 17.
Income tax
Provision for income tax
Consolidated Entity
2020
$
667,290
2019
$
-
E4G Investment Holdings Pty Limited ABN 77 614 735 474
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
Note 18.
Equity - Issued capital
Consolidated Entity
2020
2019
2020
2019
Shares
Shares
$
$
1,373,014
1,373,014
3,328,647
3,328,647
Ordinary shares - fully paid
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the
company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares
have no par value and the company does not have a limited amount of authorised capital.
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.
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Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net
debt is calculated as total borrowings less cash and cash equivalents.
In order to maintain or adjust the capital structure, the consolidated entity may adjust the amount of dividends
paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
The consolidated entity is subject to certain financing arrangements covenants and meeting these is given
priority in all capital risk management decisions. There have been no events of default on the financing
arrangements during the financial year.
The capital risk management policy remains unchanged from the 31 December 2019 Annual Report.
Note 19.
Equity- dividends
Dividends
Dividends paid during the financial year were as follows:
$144,000 per B class share (2019: $144,000) and
$144,000 per C class share (2019: $144,000)
Consolidated Entity
2020
$
2019
$
576,000
576,000
E4G Investment Holdings Pty Ltd holds 100% of the ordinary shares of Aerison Holdings Pty Ltd. As at 31
December 2020, there were also 2 fully paid B class and 2 fully paid C class shares of Aerison Holdings Pty
Ltd held by Araosc Financial Investments Pty Ltd and S2S Investment Holdings Pty Ltd respectively. These
special class shares participate in dividends and are entitled to one vote when a poll is called at shareholders’
meetings.
Franking credits
Consolidated Entity
2020
$
2019
$
Franking credits available for subsequent financial years
based on a tax rate of 30%
2,440,875
2,687,732
E4G Investment Holdings Pty Limited ABN 77 614 735 474
Note 20.
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
38
Notes to the financial statements
31 December 2020
Equity- reserves
Consolidated Entity
Performance rights reserve
Performance rights reserve
The reserve is used to recognise the fair value of
performance rights issued
500,000 (2019: nil) performance rights issued 28 July
2020
2020
$
99,500
99,500
2019
$
-
-
Share based payments
On 28 July 2020, the company issued 250,000 performance rights to Teresa Leone (director-related spouse
of Giuseppe Leone) and 250,000 performance rights to Vanessa Hibbs (director-related spouse of Daniel
Hibbs). The performance rights were issued as compensation for the recipients agreeing to provide joint
personal guarantees to Export Finance Australia (“EFIC”), as part of an uncommitted bond facility between
the company and EFIC for $4,690,000, dated 30 March 2020. The company is also a guarantor on the EFIC
facility, along with Aerison Pty Ltd, Aerison Holdings Pty Ltd, Aerison Services Pty Ltd, Daniel Hibbs and
Giuseppe Leone. Under the terms of the performance rights:
i.
ii.
iii.
iv.
v.
vi.
vii.
viii.
the performance rights were issued for nil purchase price and no consideration is due or payable
upon the issue of shares upon the conversion of any of the performance rights;
each performance right will automatically convert into one ordinary share upon the achievement of a
liquidity event which values 100% of the shares on issue at the time immediately prior to the liquidity
event, in any, or all of the consolidated entities, the company or any group company at $20 million or
greater;
the performance rights will automatically expire if no liquidity event occurs on or before 17 October
2022;
the performance rights are fully transferrable at the sole and absolute election of the holder;
a performance right does not confer any right to a return of capital, whether in a winding up, or a
reduction of capital;
a performance right has no right to participate in the surplus profits or assets of the company upon
winding up;
the performance rights do not confer on the holder an entitlement to vote at general meetings of the
company or to receive dividends; and
shares issued upon conversion of the performance rights will rank pari passu with the company’s
existing shares in all respects.
The fair value of the performance rights was determined via independent third party valuation conducted by
Moore Stephens. Various sources were considered when selecting a valuation methodology, including AASB
2 accounting standard, the Australian Taxation Office and general option valuation theory. Due to the
traditional structure of the performance rights in that they do not have any non-market based vesting
conditions and the value is simply linked to the underlying value of the business, a binomial valuation
methodology was selected, which valued each right at $0.199.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
39
Notes to the financial statements
31 December 2020
Note 21.
Financial instruments
Financial risk management objectives
The consolidated entity's activities expose it to a variety of financial risks: market risk (including price risk and
interest rate risk), credit risk and liquidity risk. The consolidated entity's overall risk management program
focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the
financial performance of the consolidated entity. The consolidated entity uses different methods to measure
different types of risk to which it is exposed. These methods include sensitivity analysis in the case of interest
rate and other price risks and ageing analysis for credit risk.
Risk management is carried out by senior finance executives ('finance') under policies approved by the
Board of Directors ('the Board'). These policies include identification and analysis of the risk exposure of the
consolidated entity and appropriate procedures, controls and risk limits. Finance identifies, evaluates and
hedges financial risks within the consolidated entity's operating units. Finance reports to the Board on a
monthly basis.
Market risk
Price risk
The consolidated entity is not exposed to any significant price risk.
Interest rate risk
The consolidated entity's main interest rate risk arises from borrowings. Borrowings obtained at variable rates
expose the consolidated entity to interest rate risk. Borrowings obtained at fixed rates expose the consolidated
entity to fair value risk.
The Commonwealth Bank debtor financing facility is the only material borrowing obtained at variable rates.
Due to the nature of the facility, wherein the drawdowns are generally fully repaid within 1-2 months, upon
receipt of payments from customers, the consolidated entity does not have material interest rate exposure
typically associated with regular variable rate bank borrowings.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial
loss to the consolidated entity. The consolidated entity has a strict code of credit, including obtaining agency
credit information, confirming references and setting appropriate credit limits. The consolidated entity obtains
guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk at the reporting
date to recognised financial assets is the carrying amount, net of any provisions for impairment of those assets,
as disclosed in the statement of financial position and notes to the financial statements. The consolidated entity
does not hold any collateral.
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of
this include the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure
to make contractual payments for a period greater than 1 year.
Liquidity risk
Vigilant liquidity risk management requires the consolidated entity to maintain sufficient liquid assets (mainly
cash and cash equivalents) and available borrowing facilities to be able to pay debts as and when they become
due and payable.
The consolidated entity manages liquidity risk by maintaining adequate cash reserves and available borrowing
facilities by continuously monitoring actual and forecast cash flows and matching the maturity profiles of
financial assets and liabilities.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
Note 21. Financial instruments continued
Financing arrangements
Unused borrowing facilities at the reporting date:
Consolidated Entity
2020
$
2019
$
9,574,085
9,574,085
6,493,700
6,493,700
Commonwealth Bank of Australia
Total
Remaining contractual maturities
The following tables detail the consolidated entity's remaining contractual maturity for its financial instrument
liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based
on the earliest date on which the financial liabilities are required to be paid. The tables include both interest
and principal cash flows disclosed as remaining contractual maturities and therefore these totals may differ
from their carrying amount in the statement of financial position.
Consolidated- 2020
Non-derivatives
Non-interest bearing
Trade payables
Sundry payables
Interest-bearing - fixed
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Lease liability
CBA- Trade Debtors
Facility
Insurance Premium
Finding
Weighted
average
interest
rate
%
1 year or less
Between 1 and
2 years
Between 2 and
5 years
Over 5 years
Remaining
contractual
maturities
$
$
$
$
$
- 8,094,779
- 4,840,611
-
-
-
-
- 8,094,779
- 4,840,611
11.73% 3,823,929
-
-
- 3,823,929
8.10%
664,551
422,799 1,447,603
236,019 2,770,972
2.05% 9,728,705
3.95%
120,286
-
-
-
-
- 9,728,705
-
120,286
Total non-derivatives
27,272,861
422,799 1,447,603
236,019 29,379,282
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
41
Notes to the financial statements
31 December 2020
Note 21. Financial instruments continued
Consolidated- 2019
Non-derivatives
Non-interest bearing
Trade payables
Sundry payables
Payable to director
Payable to vendors-
conditional
Convertible notes
Lease liability
CBA- Trade Debtors
Facility
Insurance Premium
Finding
Total non-derivatives
Weighted
average
interest
rate
%
1 year or less
Between 1 and
2 years
Between 2 and
5 years
Over 5 years
Remaining
contractual
maturities
$
$
$
$
$
-
-
-
7,691,055
8,074,892
25,000
983,922
-
-
-
-
20.02%
2,476,255
-
7.30%
270,135
62,216
2.70% 11,871,258
1.75%
111,626
-
-
31,504,143
62,216
-
-
-
-
-
-
-
-
-
- 7,691,055
- 8,074,892
-
-
25,000
983,922
- 2,476,255
-
332,351
- 11,871,258
-
111,626
- 31,566,359
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Interest-bearing - fixed
rate
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
Note 22.
Key management personel disclosures
Compensation
The aggregate compensation made to directors and other members of key management personnel of the
consolidated entity is set out below:
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Short-term employee benefits
Post-employment benefits
Long-term benefits
Total compensation
Consolidated Entity
2020
$
1,617,950
214,973
-
2019
$
1,072,107
73,007
-
1,832,923
1,145,114
E4G Investment Holdings Pty Limited ABN 77 614 735 474
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Notes to the financial statements
31 December 2020
Note 23.
Related party transactions
Parent entity
E4G Investment Holdings Pty Ltd is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 25.
Associates
There are no interests in associates.
Key management personnel
Disclosures relating to key management personnel are set out in note 22.
Transactions with related parties
The following transactions occurred with related parties:
Consulting fee paid to director (M Fennell)
Performance rights issued to directors’ spouses (V
Hibbs, T Leone)
Payment of sundry payable due to director (G Leone)
Receipt of funds due from director (G Leone)
Receipt of funds due from director (D Hibbs)
Disclosures relating to performance rights and share based payments are set out in note 20.
Receivable from and payable to related parties
The following balances are outstanding at the reporting date in relation to transactions with related parties:
Consolidated Entity
2020
$
2019
$
-
15,000
99,000
25,000
110,095
105,333
-
-
-
-
Consolidated Entity
2020
$
2019
$
-
25,000
Consolidated Entity
2020
$
-
-
2019
$
105,760
76,998
E4G Investment Holdings Pty Limited ABN 77 614 735 474
Current payables:
Payables to director (G Leone, consultancy fees)
Receivables from related parties:
Funds due from Director (G Leone)
Funds due from Director (D Hibbs)
Loans to/from related parties
There are no loans to/from related parties
Profit after income tax
Total comprehensive income
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Share based payment
Total equity
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
Note 24.
Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Parent Entity
2020
$
-
-
Parent Entity
2020
$
12,222
10,350,889
6,922,742
6,922,742
2019
$
-
-
2019
$
12,332
6,943,499
3,614,852
3,614,852
3,328,647
3,328,647
99,500
-
3,428,147
3,238,647
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
E4G Investment Holdings Pty Ltd has provided guarantees for the finance lease facilities that Aerison Pty Ltd
has with the Commonwealth Bank of Australia.
Contingent liabilities
E4G Investment Holdings Pty Ltd has provided a corporate guarantee, for the bank guarantee facilities of
Aerison Pty Ltd, to the Commonwealth Bank of Australia and Westpac Banking Corporation, totalling
$8,027,192. The facilities are secured by a fixed and floating charge over certain short-term bank deposits.
Capital commitments
The parent entity had no capital commitments for property, plant and equipment as at 31 December 2020
and 31 December 2019.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed
in note 1.
E4G Investment Holdings Pty Limited ABN 77 614 735 474
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E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
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Notes to the financial statements
31 December 2020
Note 25.
Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following wholly-
owned subsidiaries in accordance with the accounting policy described in note 1:
Aerison Holdings Pty Limited
Aerison Pty Ltd
Aerison Services Pty Ltd
Aerison EPC Pty Ltd
Aerison Mechanical and Electrical Technology
Pty Ltd (Dormant)
Principal place of business/
Country of Incorporation
2020
%
2019
%
Ownership Interest
Australia
Australia
Australia
Australia
Australia
100
100
100
100
100
25
100
100
25
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Note 26.
Non-cash investing and financing activities
Additions to the right-of-use assets
Consolidated Entity
2020
$
3,550,381
2019
$
-
Note 27.
Changes in liabilities arising from financing activities
Consolidated - 2020
Balance at 1 January 2019
Net cash used in financing activities
Non-cash redemption premium and
costs
Leases recognised on the adoption of
AASB 16
Balance at 31 December 2019
Net cash used in financing activities
Non-cash redemption premium and
costs
Convertible
Notes
$
IPF Facility
CBA facility
Lease Liability
Total
$
$
$
$
2,341,201
58,042
3,902,643
311,771
6,613,657
(217,800)
53,584
7,968,615 (1,055,773)
6,748,626
352,854
-
- -
352,854
-
-
-
1,076,353
1,076,353
2,476,255
111,626
11,871,258
332,351
14,791,490
927,161
8,660 (2,142,553) (1,111,760)
(2,318,492)
420,513
-
- -
420,513
Acquisition of leases
-
-
-
3,550,381
3,550,381
Balance at 31 December 2020
3,823,929
120,286
9,728,705
2,770,972
16,443,892
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
45
Notes to the financial statements
31 December 2020
Note 28.
Cash flow information
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Consolidated Entity
2020
$
2019
$
5,051,046
4,115,639
2,052,801
52,745
8,871
99,500
1,836,525
-
70,976
-
(5,571,593)
(15,014,922)
(546,508)
(2,348,778)
667,290
981,908
1,065,059
1,512,341
(186,373)
8,175,381
-
1,797,785
560,984
1,355,995
Reconciliation of cash flow from operations with profit
after income tax
Profit after income tax
Non-cash flows adjustments:
Depreciation expense
Net on disposal of property, plant and equipment
Interest expense
Share based payments
Changes in operating assets and liabilities;
- trade and other receivables
- prepayments and other assets
- trade and other payables
- income tax payable
- deferred tax assets and liabilities
- employee benefits
Net cash generated from operating activities
Note 29.
Contingent assets and liabilities
Contingent assets
The Group has no contingent assets.
Contingent liabilities
The Commonwealth Bank of Australia and Westpac Banking Corporation provided the Group with bank
guarantee facilities totalling $8,027,192 (2019: $6,875,720). The facilities are secured by a fixed and floating
charge over certain short-term bank deposits.
Note 30.
Events after the reporting date
The impact of the Coronavirus (COVID-19) pandemic is ongoing. it is not practicable to estimate the potential
impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on
measures imposed by the Australian Federal Government or Western Australian State Government.
No other matter or circumstance has arisen since 31 December 2020 that has significantly affected, or may
significantly affect the consolidated entity's operations, the results of those operations, or the consolidated
entity's state of affairs in future financial years.
Note 31. Group details
The registered office of the Group is:
60 Havelock Street
West Perth WA 6005
The principal place of business is:
Level 1, 56 Ord Street,
West Perth WA 6005
E4G Investment Holdings Pty Limited ABN 77 614 735 474
E4G INVESTMENT HOLDINGS PTY LTD AND CONTROLLED SUBSIDIARIES 2020 ANNUAL REPORT
46
Directors' Declaration
In the directors’ opinion:
a)
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting
Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;
b) the attached financial statements and notes comply with International Financial Reporting Standards as
issued by the International Accounting Standards Board as described in note 1 to the financial
statements;
c) the attached financial statements and notes give a true and fair view of the consolidated entity's financial
position as at 31 December 2020 and of its performance for the financial year ended on that date; and
d) there are reasonable grounds to believe that the company will be able to pay its debts as and when they
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become due and payable.
On behalf of the directors.
Giuseppe Leone
Director
Dated this 9th day of March 2021
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