26 August 2019
Company Announcements
For Immediate Release
ASX Code: AMA
APPENDIX 4E AND FINANCIAL REPORT FOR AMA GROUP LIMITED
In accordance with the Listing Rules of the Australian Securities Exchange (“ASX”), AMA Group
Limited encloses for immediate release the following information:
1. Appendix 4E, the Preliminary Final Report for the Year ended 30 June 2019; and
2. The Annual Report for the Year ended 30 June 2019.
If you have a query about any matter covered by this announcement, please contact Mr Steve
Becker on steve.becker@amagroupltd.com.
Ends.
ABN 50 113 883 560
AMA GROUP LTD.
Level 4, 130 Bundall Road, Bundall, QLD 4217
Phone: (07) 5628 3272
Email: info@amagroupltd.com
AMA GROUP LIMITED
(ACN 113 883 560)
ASX LISTING RULES – APPENDIX 4E
PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
The following information is presented in accordance with Listing Rule 4.3A of the Australian Securities
Exchange (“ASX”).
1.
Details of the reporting period and the previous corresponding period
Current reporting period
Previous corresponding period
- the year ended 30 June 2019
- the year ended 30 June 2018
2.
Results for announcement to the market
Year ended
2.1 Revenues from continuing operations
(including joint venture profit share)
30 Jun 2019 30 Jun 2018
$’000
$’000
Increase / (Decrease)
$’000
%
616,174
509,756
106,418
20.9
Earnings before interest, tax
depreciation, amortisation and
impairment from continuing
operations
Normalised earnings before interest,
tax, depreciation, amortisation and
impairment from continuing
operations
50,127
43,633
6,494
14.9
58,184
52,156
6,028
11.6
2.2 Profit after tax from continuing
operations attributable to members
21,715
15,108
6,607
43.7
Normalised profit after tax from
continuing operations attributable to
members
28,130
24,073
4,057
16.9
2.3 Net profit for the period attributable to
members
21,553
15,105
6,448
42.7
Normalised net profit for the period
attributable to members
27,967
24,069
3,898
16.2
Normalised results are unaudited Non-IFRS measures. Refer to the attached Financial Report for
details of these calculations.
2.4 Dividends (distributions)
Amount per
security
(cents)
Franking amount
per security
Conduit foreign
income per
security
2019 Final
2.25
100%
Nil
2.5 Record date for determining entitlements to the dividend
13 September 2019
AMA GROUP LIMITED
(ACN 113 883 560)
ASX LISTING RULES – APPENDIX 4E
PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
2.6 Commentary on “Results for Announcement to the Market”
A brief explanation of any of the figures in 2.1 to 2.4 above, necessary to enable the figures to be
understood, is contained in the attached Annual Report for the Year ended 30 June 2019.
3.
A statement of comprehensive income
A statement of comprehensive income together with notes to the statement is contained in the
attached Annual Report for the Year ended 30 June 2019.
4.
A statement of financial position
A statement of financial position together with notes to the statement is contained in the attached
Annual Report for the Year ended 30 June 2019.
5.
A statement of cash flows
A statement of cash flows together with notes to the statement is contained in the attached Annual
Report for the Year ended 30 June 2019.
6.
A statement of changes in equity
A statement of changes in equity, showing movements is contained in the attached Annual Report for
the Year ended 30 June 2019.
7.
Details of individual and total dividends or distributions and dividend or distribution
payments.
Type
Record Date
Payment
Date
Total
Dividend ($)
Amount
per
Security
(cents)
Franked
amount
per
security
Conduit
foreign
income
per
security
2018 Final
14 Sep 2018
13 Nov 2018
2019 Interim
15 Mar 2019 15 May 2019
2.0
0.5
10,595,237
2,704,263
100%
100%
Nil
Nil
8.
Details of any dividend distribution reinvestment plans.
Not Applicable.
9.
Net Tangible Assets per Security
Year ended
30 Jun 2019
cents
30 Jun 2018
cents
Increase / (Decrease)
cents
%
Net tangible assets per security
(14.82)
(6.49)
(8.33)
128.4
AMA GROUP LIMITED
(ACN 113 883 560)
ASX LISTING RULES – APPENDIX 4E
PRELIMINARY FINAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
10. Details of entities over which control has been gained or lost during the period.
During the period, control was gained over the following entities:
Name of entity
Date
control
gained
Contribution to profit from
ordinary activities
30 Jun 2019
$’000
30 Jun 2018
$’000
Mt Druitt Autobody Repair Group of companies
1 Jul 2018
1,990
-
- Mt Druitt Auto Body Repairs Pty Ltd
- Accident Repair Management Pty Ltd
- Accident Repair Management No. 2 Pty Ltd
- Accident Repair Management No. 3 Pty Ltd
During the period, control was not lost over any entity.
11. Details of any associates and joint venture entities
There were no associates or joint ventures during the period.
12. Any other significant information needed by an investor
Further significant information needed by an investor to make an informed assessment of the entity’s
financial performance and financial position is contained in the attached Annual Report for the Year
ended 30 June 2019.
13.
Foreign Entities, Accounting Standards used in compiling the report
Not Applicable.
14. A commentary on the results for the period
A commentary, including any significant information needed by an investor to make an informed
assessment of the entity’s activities and results, is contained in the attached Annual Report for the
Year ended 30 June 2019.
15. Audit / Review of Accounts upon which this report is based and qualification of audit / review
This Preliminary Final Report is based on the attached Annual Report for the Year ended 30 June
2019 which has been audited by ShineWing Australia. The audit report is attached as part of the
Annual Report and is not subject to a modified opinion, emphasis of matter or other matter
paragraph.
AMA GROUP LIMITED
ABN 50 113 883 560
Annual Report for the Year Ended
30 June 2019
AMA GROUP LIMITED
(ACN 113 883 560)
TABLE OF CONTENTS
Table of Contents
EXECUTIVE CHAIRMAN AND CEO’S ADDRESS ............................................................................................. 1
DIRECTORS’ REPORT ....................................................................................................................................... 2
REMUNERATION REPORT ............................................................................................................................. 13
AUDITOR’S INDEPENDENCE DECLARATION ............................................................................................... 22
CONSOLIDATED INCOME STATEMENT ........................................................................................................ 23
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME ................................................................. 24
CONSOLIDATED STATEMENT OF FINANCIAL POSITION ........................................................................... 25
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ........................................................................... 26
CONSOLIDATED STATEMENT OF CASHFLOWS ......................................................................................... 27
NOTES TO THE FINANCIAL STATEMENTS ................................................................................................... 28
DIRECTORS’ DECLARATION .......................................................................................................................... 96
INDEPENDENT AUDITOR’S REPORT ............................................................................................................ 97
CORPORATE GOVERNANCE STATEMENT ................................................................................................ 102
SHAREHOLDER INFORMATION ................................................................................................................... 109
CORPORATE DIRECTORY ............................................................................................................................ 113
This document contains some statements which are by their very nature forward looking or predictive. Such forward
looking statements are by necessity at least partly based on assumptions about the results of future operations which are
planned by the Company and other factors affecting the industry in which the Company conducts its business and markets
generally. Such forward looking statements are not facts but rather represent only expectations, estimates and/or
forecasts about the future and thereby need to be read bearing in mind the risks and uncertainties concerning future
events generally.
There are no guarantees about the subjects dealt with in forward looking statements. Indeed, actual outcomes may differ
substantially from that predicted due to a range of variable factors.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
AMA GROUP LIMITED
(ACN 113 883 560)
EXECUTIVE CHAIRMAN AND CEO’S ADDRESS
EXECUTIVE CHAIRMAN AND CEO’S ADDRESS
Dear Shareholders,
We are delighted to present you with our results for the 2019 Financial Year.
Twelve months ago, we outlined our long-term plan for AMA Group Limited (ASX: AMA). Our key priorities
included consolidating Australia’s vehicle panel repair industry, executing further “Greenfield” opportunities,
expanding our partnership agreements and identifying and executing strategic acquisitions in the Automotive
Components and Accessories divisions. We are pleased to say this plan is on track and delivering success,
but there is much more work to do.
We finished the financial year with the strongest set of results in the company’s history. AMA’s strong growth
in 2019 is best reflected by a 21% increase in revenue to more than $616 million, up from $510 million in the
previous year. We report an unaudited normalised EBITDA of $58.2 million, up $6 million and 12% on last
year’s result, and consistent with the market guidance. We delivered 39% growth in reported basic earnings
per share from continuing operations, an increase from 2.88 cents to 4.00 cents and are pleased to declare a
final dividend of 2.25 cents per share to our shareholders.
The Vehicle Panel Repair division, which accounted for 86% of our business in the past year, completed 21
acquisitions and opened four greenfields, which is an impressive feat. Of those acquisitions, six were within
the Heavy Vehicle Repair industry, an attractive new growth market and strategic focus of AMA.
The Automotive Components & Accessories divisions (ACAD) delivered positive results with a significant
increase in revenue and a focus on improving the performance of the more recently acquired business units.
The ACAD business has embedded the right mix of personnel within their teams and further developed new
designs and innovative product ranges to ensure the division is set up for future growth. The team is looking
forward to a busy FY2020 with a continued focus on improving the quality of revenue and identifying and
executing strategic acquisitions.
AMA will continue to pursue an extensive pipeline of potential acquisitions and Greenfield development sites,
as we work towards $1 billion in revenue by FY2021 and $100 million in EBITDA. To achieve this goal we will
require both strategic acquisitions and whole-of-business continuous improvement. These priorities include:
1. Realising the full potential of our team;
2.
3.
Enhancing our processes and systems – a “one platform” approach; and
Strongly aligning our brand with our customers.
AMA recently relocated both the Corporate Head Office and Panel Division Support Centre into new a
corporate office at Bundall, QLD, setting AMA up for future growth.
The economic outlook and market conditions remain challenging. However, the Board and the CEO have
great confidence that the combination of the defensive nature of our industry, and our proven acquisition
strategy, our ability to increase revenues while containing cost, and the quality, high-performing people within
our business will ensure your company will deliver strong returns into the future.
Raymond Malone
Executive Chairman
Andrew Hopkins
Group Chief Executive Officer
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
1
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
DIRECTORS’ REPORT
Your Directors submit the consolidated financial statements of AMA Group Limited (“AMA” or the “Company”)
and its controlled entities (the “Group”) for the year ended 30 June 2019. In order to comply with the
provisions of the Corporations Act 2001, the Directors report as follows:
DIRECTORS AND OFFICERS
The names and particulars of the Directors and Company Secretary of the Company in office at any time
during or since the end of the period are as follows:
Chairman and Executive Director
Mr Raymond Malone
Mr Andrew Hopkins
Executive Director
Mr Raymond Smith-Roberts Executive Director
Mr Leath Nicholson
Mr Brian Austin
Mr Simon Moore
Mr Anthony Day
Mr Hugh Robertson
Non-Executive Director
Non-Executive Director
Non-Executive Director (Appointed 28 Nov 2018)
Non-Executive Director (Appointed 28 Nov 2018)
Non-Executive Director (Resigned 3 Aug 2018)
Mrs Terri Bakos
Company Secretary
REVIEW AND RESULTS OF OPERATIONS
Principal Activities
The principal activity of the Group is the operation and development of complementary businesses in the
automotive aftercare market. It focuses on the wholesale vehicle aftercare and accessories sector, including
vehicle panel repair, vehicle protection products & accessories, automotive electrical & cable accessories,
automotive component remanufacturing and workshop & performance products.
Significant changes in state of affairs
There were no significant changes in the state of affairs of the Group during the financial year.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
2
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
Key Achievements
The Directors are proud of the team’s progress in executing the Board’s strategy to expand our business and
task advantage of industry consolidation while generating value and positive returns to shareholders.
FY2019 was another milestone year for AMA, which achieved a number of important successes throughout
the reporting period including:
• Exceeded $600m in revenue with growth of 21% and on-track to reach $1 billion revenue by FY2021.
• Completed 21 acquisitions, including six (6) business acquisitions in the Heavy Vehicle Repair industry.
This sector is an attractive new growth market and a strategic focus of AMA.
• The Vehicle Panel Repair division increased the number of shops it operates to 130 at 30 June 2019.
• The Vehicle Panel Repair division opened four (4) new greenfield sites, all supported by insurer contracts.
• Automotive Components & Accessories Divisions (ACAD) completed a major restructuring program, fully
integrating the Automotive Solutions Group acquisition into its existing businesses, and performed to
expectation.
• Relocated of the Corporate Head Office and Panel Division Support Centre into new a corporate office in
Bundall, QLD, which sets AMA up for future growth.
• Received the second tranche of the market investment incentive instalment in the amount of $30.9m.
Operating Results
Reported earnings before interest, tax, depreciation, amortisation and impairment expense from continuing
operations (“EBITDA”) has increased from $43.6 million to $50.1 million; a 15% increase. This result,
however, has been significantly impacted by several large abnormal items. Adjusting the result for these
abnormal items results in an unaudited normalised EBITDA of $58.2 million, an increase of 12% from the prior
comparative year of $52.2 million. Importantly, this unaudited normalised EBITDA result is consistent with the
Company’s latest market guidance being “normalised EBITDA of approximately $58m”.
30 June 2019
$’000
30 June 2018
$’000
Reported EBITDA (audited)
50,127
43,633
Employee equity plan expense
Procurement project
Greenfield start-up costs
Site integrations
Business acquisition costs
Reorganisation costs
IT roll out
Litigation and resolution costs
Site closures and make good
Other
Blackstone Due Diligence costs
Gain on acquisition of ASG
1,499
967
1,000
900
1,494
733
1,000
182
150
132
-
-
853
550
2,500
1,400
1,363
294
650
-
150
-
2,871
(2,108)
Normalised EBITDA (unaudited)
58,184
52,156
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
3
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
The Group’s reported net profit before tax from continuing operations (“NPBT”) has increased from $24.7
million to $31.4 million, an increase of 27.3%.
Vehicle Panel Repair
The Vehicle Panel Repair division increased its revenue by 21.4% and its reported EBITDA by 18.9%. A
major contributor to this growth was the full year impact of the acquisitions completed in FY2018 and the part
year impact of the current year’s acquisitions.
During the year the division integrated 21 acquisitions and opened four (4) greenfields. We also commenced
operations into the Heavy Vehicle Repair industry, with acquisitions of six (6) businesses across three states.
A new CEO (appointment date 1 July 2019) was recruited to lead the Panel Division. Steve Bubulj joined our
team and brings significant insurance industry knowledge and commercial acumen. Mr Bubulj has a strong
bond to the business given his lengthy time in the industry, and he has a strong affinity with AMA’s business
and growth story.
The division completed the rollout of the new ERP (NetSuite) and GemSafe, a purpose-built Workplace Health
& Safety / Occupational Health & Safety governance platform which provides AMA with industry leading
labour advantages. The division also commenced the rollout of Torque, a purpose-built environmental
governance management platform which provides AMA with an industry leading advantage.
During the year, the division launched a digital, centralised estimating service to insurer and fleet clients which
has enhanced the customers experience as well as materialising efficiencies in estimating, triage and
allocating motor vehicle repairs throughout AMA’s network.
The division continued the development of its apprentice programs, with these efforts recognised with an
industry first female finalist in the World Skills Competition in Russia, as well as the division being a finalist in
the Champion Employer of the Year award.
Automotive Components & Accessories Divisions
ACAD performed well in another challenging year, with new vehicle sales seeing year-on-year decreased
volumes throughout all of FY2019. Management is pleased to report that all four divisions again delivered
positive results. Our CSM Service Bodies business, acquired 1 December 2017, continued to deliver excellent
results taking advantage of favourable market opportunity in the specialised fleet area, achieving revenues of
$14.6m compared to $5.1m for the 7 months to 30 June 2018. We opened a second fitting site in Q4 FY2019
that will result in increased volumes and take advantage of opportunities to grow the CSM business.
In FY2019 the Vehicle Protection Products & Ute Accessories Division (Manufacturing) engaged a new
production management team whose focus is to continue improving margins in FY2020. We worked closely
with our OEM customers to develop protection products for their new vehicle ranges utilising our expert
product development team.
The Automotive Electrical & 4x4 Accessories Division (Distribution) continued integration of the 4x4
Accessories ranges and further development of new innovative product ranges enabled a modest increase in
revenue, despite ongoing cost pressures. The evolution of the AE4A West branch in converting “other” brand
products to our own brands contributed to improvement in revenue quality and cashflow. Expansion of the
solar range through our national retail chain customers has bolstered future supply to market.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
4
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
In a challenging year the Automotive Remanufacturing Division (Re-manufacturing) achieved a solid
performance to deliver a similar result to FY2018. We continue to build on our OEM relationships to help drive
future volumes through new model development.
Workshop & Performance Products Division (Workshop) contributed positively to the FY2019 results despite
the softening in the sector. Our key focus has been on harnessing our existing customer base and developing
increased channels to market. This approach has successfully attracted work from two significant fleet
customers and a number of other key commercial clients.
Cash Flow
Underlying cash flow generated from earnings and net cash flows from operating activities has been strong.
Below is a table that reconciles between the two results.
Reported EBITDA (audited)
Discontinued operations
Interest paid
Non-cash Remuneration
Gain on acquisition of ASG
Other non-cash items
30 June 2019
$’000
30 June 2018
$’000
50,127
43,633
(238)
(2,595)
1,499
-
(682)
32
(786)
853
(2,108)
(1,293)
Cash Earnings (Pre-Tax and Deferred Income Amortisation)
48,111
40,331
Income tax paid
Deferred income amortisation
Increase in inventories
Other working capital movement
(7,794)
(9,419)
(10,881)
(540)
(9,423)
(7,453)
-
1,019
Net cash flows used in operating activities
19,477
24,474
Cashflow for the period was in line with expectations. Key points to note:
• The group increased its debt facilities to $150 million (including a $25 million accordion) over the period
and drew down $52.8 million to facilitate acquisitions, finalise contractual earnouts and for general
corporate purposes. Interest and borrowing costs increased consistent to expectations.
• The group spent $37.5 million on the acquisition of new businesses during the period.
• An equity raising to new sophisticated investors during the period raised $9.5 million. These funds were
used to facilitate the set-up of the Group’s new Procurement division.
Financial Position
The Current Ratio has decreased from 0.95 times to 0.84 times. This ratio is impacted by the significant non-
cash items in other current liabilities; namely the unamortised Deferred Income and the scrip component of
Contingent Vendor Consideration. Adjusting this ratio for these items, the Current Ratio adjusted for non-cash
items improves from 0.84 times to 0.98 times.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
5
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
The gearing ratio has slightly increased from 11.46% at June 2018 to 13.28% at June 2019. While the
Company’s market capitalisation and the amount owing on Contingent Vendor Consideration has increased,
the major contributor to this increased gearing ratio has been the increased debt facilities held by the group.
Even so, the Directors believe that the Group is conservatively geared and that the Group has sufficient
capital resources, including the committed debt facility, which had $44.4 million undrawn at balance date.
This robust financial position will allow the Group to take advantage of the large number of attractive
acquisitions and greenfield expansion opportunities currently before it, as well as allow the Group to grow its
exciting new procurement division.
Capital Management
In November 2018, AMA paid the FY2018 final dividend of 2.0 cents per share fully franked at 30%.
In May 2019, AMA paid the FY2019 interim dividend of 0.5 cents per share fully franked at 30%.
Upon finalising the final report, the Directors are pleased to announce they have decided to declare a final
dividend, fully franked at 30%, of 2.25 cents per share with a record date of 13 September 2019 and a
payment date of 13 November 2019.
Basic earnings per share from continuing operations have increased from 2.88 cents to 4.00 cents; an
increase of 38.9%.
The closing price for an AMA Share on the ASX has also increased through the year from 104.5 cents at 30
June 2018 to 143.0 cents at 30 June 2019; an increase of 36.8%.
Business Strategies and Future Prospects
In recent years, the strategic direction of the Group has been focused on the growth opportunities presenting
themselves to both the Vehicle Panel Repairs and Automotive Components & Accessories Divisions. It was
believed that the Group could exploit these opportunities with:
• Market leading brands;
• Strong relationships with customers and suppliers across multiple channels;
•
• A robust strong financial position.
Industry experienced management with a commitment to operating excellence; and
It was anticipated that most business segments would have organic growth potential but given the
consolidation of the Vehicle Panel Repair industry there would be significant opportunities for strategic and
accretive acquisitions in this industry segment. To this end, Management then embarked on execution of its
business growth plan.
The Directors believe that the strong financial performance of AMA in the current reporting period reflects the
ongoing outcomes of this strategic plan. The investments made have resulted in a significant increase in the
scale and scope of the operations. The results are in line with the Directors’ expectations, and show a
substantial increase in the Group’s operating revenue and EBITDA over the past three years.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
6
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
The Board believe that there are still substantial growth opportunities presenting to the key business divisions.
The consolidation of the Vehicle Panel Repair industry continues and Management are actively involved in
negotiating the acquisition of existing businesses and the development of new “greenfield” sites, supported by
insurer customer contracts. These growth opportunities also exist for the non-panel repair operating divisions.
The acquisition of further businesses will provide scale to the operations and consolidate our position as
market leaders.
SUBSEQUENT EVENTS
On 3 July 2019, AMA acquired the remaining 40% shares in Woods Auto Shops (Dandenong) Pty Ltd.
On 8 August 2019, a fully refundable deposit of $4 million was returned for an acquisition that did not proceed.
On 26 August 2019, the Directors declared a dividend, fully franked of 2.25 cents per security which is to be
paid 13 November 2019.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS OF OPERATIONS
AMA will continue to pursue the growth opportunities presenting themselves to both Vehicle Panel Repairs
and Automotive Components & Accessories Divisions. AMA believes that its continued application of key
management strategies combined with its acquisition strategy will continue to boost future earnings.
MEETING OF DIRECTORS
The number of meetings of the Company's Board of Directors and of each board committee held during the
year ended 30 June 2019, and the numbers of meetings attended by each director were:
Board Meetings
Committee Meetings
Audit
Committee
Remuneration
Committee
Number
eligible to
attend
Number
attended
Number
eligible to
attend
Number
attended
Number
eligible to
attend
Number
attended
Raymond Malone
Andrew Hopkins
Raymond Smith-Roberts
Leath Nicholson
Brian Austin
Simon Moore
Anthony Day
Hugh Robertson
15
15
15
15
15
9
9
1
15
12
15
15
14
9
8
1
-
-
-
2
2
1
-
-
-
-
-
2
2
1
-
-
-
-
-
2
2
2
2
-
-
-
-
2
1
2
2
-
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
7
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
DETAILS OF DIRECTORS AND OFFICERS
The name and details of the Directors and Officers in office during the financial year and until the date of this
report are as follows. Secretaries were in office for the entire period unless otherwise stated.
Raymond Malone
Chairman and Executive Director
Appointed to the Board
Appointed Executive Chairman
Experience and expertise
Interest in Shares and Options*
Directorships held in other
listed entities
Special responsibilities
23 January 2009
19 March 2015
With over 30 years work experience in the automotive panel repair
industry, Mr Malone has progressed from a spray painter through
to business ownership and senior executive positions. He has
developed many strong relationships with key customers focusing
on excellent customer service. He has developed extensive
business skills which he has consistently applied to AMA’s
development since 2009.
36,315,349 Fully Paid Ordinary Quoted shares and Nil options
Nil
Nil
Andrew Hopkins
Executive Director
Appointed to the Board
Experience and expertise
Interest in Shares and Options*
Directorships held in other
listed entities
Special responsibilities
17 December 2015
Mr Hopkins founded the Gemini Group in Perth in 2009 and built
the Gemini brand into one of the largest privately-owned
consolidators offering integrated claims management and repair
services to the insurer, corporate and consumer markets.
He brings extensive management expertise to the AMA group.
With over 35 years of experience in finance, acquisitions, strategy
and building insurance relationships, his ability to continually
innovate will broaden AMA’s relationships with insurance
companies both domestically and internationally.
33,561,242 Fully Paid Ordinary Quoted shares and Nil options
Nil
Group Chief Executive Officer
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
8
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
Raymond Smith-Roberts
Executive Director
Appointed to the Board
Experience and expertise
Interest in Shares and Options*
Directorships held in other
listed entities
Special responsibilities
28 February 2014
Mr Smith-Roberts has over 25 years work experience in the
automotive industry. He joined ECB many years ago progressing
to general manager and then became managing director when the
Company became part of AMA. Over the years he has attained
valuable operational knowledge and experience having been the
Group Chief Operating Officer from 2009 to 2017. He is well
positioned to assist the board in developing strategy for the next
phase of the Company’s growth and development.
6,171,959 Fully Paid Ordinary Quoted shares and Nil options
Nil
Chief Executive Officer - Automotive Components and Accessories
Divisions
Leath Nicholson
Non-Executive Director
Appointed to the Board
Experience and expertise
Interest in Shares and Options*
Directorships held in other
listed entities
Special responsibilities
23 December 2015
Mr Nicholson holds a Bachelor of Economics (Hons), a Bachelor of
Law (Hons) and a Masters of Law (Commercial Law). He co-
founded Nicholson Ryan Lawyers. He has a breadth of experience
with ASX listed entities and has particular expertise in mergers and
acquisitions; IT based transactions, and corporate governance. He
also has significant experience in corporate and commercial based
dispute resolution.
1,673,395 Fully Paid Ordinary Quoted shares and Nil options
Non-Executive Director of Money3 Corporation Limited
Non-Executive Chairman of CCP Technologies Limited
Member of the Audit Committee and the Remuneration Committee
Brian Austin
Non-Executive Director
Appointed to the Board
Experience and expertise
Interest in Shares and Options*
Directorships held in other
listed entities
Special responsibilities
23 December 2015
With over 30 year’s industry experience, Mr Austin has held senior
executive positions in the insurance industry. Over that time he
has been instrumental in setting the strategy of capital raising and
acquisitions. He has been a Director of ASX listed entities,
enabling him to develop a global network of key relationships.
112,000 Fully Paid Ordinary Quoted shares and Nil options
Chairman of PSC Insurance Group Limited
Member of the Audit Committee and the Remuneration Committee
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
9
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
Simon Moore
Non-Executive Director
Appointed to the Board
Experience and expertise
Interest in Shares and Options*
Directorships held in other
listed entities
Special responsibilities
28 November 2018
Mr Moore holds a Bachelor of Law (Hons) and Commerce (Hons)
and founded Colinton Capital Partners in 2017. He is an
experienced private equity investor with significant public company
board experience. He brings to the Board strong corporate finance
skills and significant amounts of experience working closely with
senior executives assisting them with the development and
execution of their business plans. Prior to founding Colinton Capital
Partners, he was previously a Managing Director and Global
Partner of The Carlyle Group for 12 years.
20,025,000 Fully Paid Ordinary Quoted shares and Nil options
Non-Executive Director of Megaport Limited and Firstwave Cloud
Technology Limited
Non-Executive Chairman of Palla Pharma Limited
Chair of the Audit Committee and member of the Remuneration
Committee
Anthony Day
Non-Executive Director
Appointed to the Board
Experience and expertise
Interest in Shares and Options*
Directorships held in other
listed entities
Special responsibilities
28 November 2018
With over 35 years in the insurance industry, Mr Day has a broad
experience in all areas of the insurance industry. His most recent
role was as the Chief Executive Officer of Suncorp Group’s
Insurance Business. He brings to the Board strong business
judgement and an intimate understanding of our key customers,
Australasia’s auto insurance companies. He has a 20-year track
record of producing market-leading results in both growth and
profitability, whilst delivering continuous improvement in
operations.
100,000 Fully Paid Ordinary Quoted shares and Nil options
Nil
Chair of the Remuneration Committee
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
10
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
Hugh Robertson
Non-Executive Director
Appointed to the Board
Resigned from the Board
Experience and expertise
Interest in Shares and Options*
Directorships held in other
listed entities
Special responsibilities
2 June 2015
3 August 2018
Mr Robertson has worked in stockbroking for over 30 years with a
variety of firms including Wilson HTM, Investor First and more
lately Bell Potter. Among his areas of interest is a concentration on
small cap industrial stocks and he currently sits on the boards of
several such companies.
280,000 Fully Paid Ordinary Quoted shares and Nil options
Non-Executive Director of Centrepoint Alliance Limited and
Longtable Group Limited.
Member of the Audit Committee and the Remuneration Committee
Terri Bakos
Company Secretary
Appointed
Experience and expertise
2 March 2010
Ms Bakos is a Chartered Secretary and holds a Bachelor of
Business (Accounting) from RMIT University. She has over 20
years’ experience providing accounting and compliance services to
listed and unlisted public companies.
* The relevant interest in the shares or options over shares issued by the Company of each Director,
and other related body corporate, as notified by the Director to the Australian Securities Exchange in
accordance with s 205G(1) of the Corporations Act 2001, as at the date of this report.
SHARES UNDER OPTION
Unissued ordinary shares of the Company under option at the date of this report are as follows:
Date options granted
Expiry Date
Issue Price of Shares
Number under Option
26 Nov 2018
25 Apr 2021
1.20
2,000,000
No option holder has any right under the option to participate in any other share issue of the Company or any
other entity. The options were granted as remuneration to Key Management Personnel. Details of options
granted to Key Management Personnel are disclosed in the audited remuneration report below.
SHARES ISSUED ON THE EXERCISE OF OPTIONS
No shares were issued on the exercise of options in the financial year ended 30 June 2019 or 30 June 2018.
INDEMNIFICATION AND INSURANCE OF OFFICERS AND AUDITORS
During the financial year, the Company paid a premium in respect of a contract insuring the directors, the
company secretaries, and all executive officers of the Company and of any related body corporate against a
liability incurred as such a director, secretary or executive officer to the extent permitted by the Corporations
Act 2001.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
11
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2019
The directors have not included details of the nature of the liabilities covered or the amount of the premium
paid in respect of the directors’ and officers’ liability, costs and charges, as such disclosure is prohibited under
the terms of the contract. To the extent permitted by law and professional regulations, the Company has
agreed to indemnify its auditors, ShineWing Australia, as part of the terms of their engagement against claims
by third parties arising from the audit (for an unspecified amount). No payment has been made by the
Company to ShineWing Australia in this respect during or since the financial year ended 30 June 2019.
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted
by law, indemnified or agreed to indemnify an officer or auditor of the Company or of any related body
corporate against a liability incurred as such an officer or auditor.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the Company, or to intervene in any proceedings to which the Company is a party
for the purpose of taking responsibility, on behalf of the Company, for all or part of those proceedings.
ENVIRONMENTAL REGULATION
Management continues to work with local regulatory authorities to achieve, where practical, best practice
environmental management so as to minimise risk to the environment, reduce waste and ensure compliance
with regulatory requirements. The Group had no adverse environmental issues during the year.
NON-AUDIT SERVICES
No non-audit services were provided by ShineWing Australia.
AUDITOR’S INDEPENDENCE DECLARATION
A copy of the auditor’s independence declaration, as required under Section 307C of the Corporations Act, in
relation to the audit for the year ended 30 June 2019, is provided with this report.
ROUNDING OF AMOUNTS
The Company is of a kind referred to in Class Order 2016/191, issued by the Australian Securities &
Investments Commission, relating to the “rounding off” of amounts in the Directors’ report and financial
report. Amounts in the Directors’ report and the financial report have been rounded off in accordance with
that Class Order to the nearest thousand dollars, unless otherwise indicated.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
12
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
REMUNERATION REPORT
The remuneration report is set out under the following main headings:
A
B
C
D
Principles used to determine the nature and amount of remuneration
Details of remuneration
Share-based compensation
Service agreements
This remuneration report has been prepared by the Directors of AMA Group Limited to comply with the
Corporations Act 2001 and the Key Management Personnel (“KMP”) disclosures required under AASB 124:
Related Party Disclosures.
A Principles used to determine the nature and amount of remuneration
Key Management Personnel
The following were Key Management Personnel of the entity at any time during the reporting period and
unless otherwise indicated were Key Management Personnel for the entire period:
Directors
Mr Raymond Malone
Mr Andrew Hopkins
Mr Raymond Smith-Roberts
Mr Leath Nicholson
Mr Brian Austin
Mr Simon Moore
Mr Anthony Day
Mr Hugh Robertson
Executive Management
Chairman and Executive Director
Executive Director
Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director (Appointed 28 Nov 2018)
Non-Executive Director (Appointed 28 Nov 2018)
Non-Executive Director (Resigned 3 Aug 2018)
Steven Becker
Ashley Killick
Chief Financial Officer (Appointed 4 Feb 2019)
Chief Financial Officer (Resigned 30 Oct 2018)
Remuneration policies
The Board is responsible for reviewing the remuneration policies and practices of the Company, including the
compensation arrangements of Executive Directors, Non-Executive Directors and Executive Management.
The objective of these policies is to:
• Make AMA Group Limited and its subsidiaries an employer of choice.
• Attract and retain the highest calibre personnel.
• Encourage a culture of reward for effort and contribution.
• Set incentives that reward short- and medium-term performance for the Company as a whole.
• Encourage professional and personal development.
In the case of Executive Management, any recommendation for compensation review will be made by the
Chief Executive Officer to the Remuneration Committee.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
13
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
There is no direct link between remuneration of Key Management Personnel and the share price movement.
Remuneration is based on key performance indicators, targets and other benchmarks as determined by the
Board or the Chief Executive Officer.
Non-Executive Directors
The Board determines the Non-Executive Directors’ remuneration based on independent market data for
comparative companies.
The remuneration payable from time to time to Non-Executive Directors shall be in an amount not exceeding
in aggregate a maximum sum that is approved by resolution of the Company, currently $400,000 per annum.
Non-Executive Directors’ retirement payments are limited to compulsory employer superannuation.
Executive Directors and Executive Management remuneration
The Company’s remuneration policy directs that the remuneration packages appropriately reflect the
executives’ duties and responsibilities and that remuneration levels attract and retain high calibre executives
with the skills necessary to successfully manage the Company’s operations and achieve its strategic and
financial objectives.
The Company also has a policy of rewarding extraordinary contribution to the growth of the Company with the
grant of an annual discretionary cash bonus, shares or options under the Company’s Employee Equity Plan.
Executives are also entitled to be reimbursed for their reasonable travel, accommodation and other expenses
incurred in the execution of their duties.
Remuneration packages for Executives can generally consist of three components:
• Fixed remuneration which is made up of cash salary, salary sacrifice components and superannuation;
• Short term incentives which include the issue of shares or options or a cash bonus; and
• Long term incentives which include issuing options.
Fixed remuneration
Executives who possess a high level of skill and experience are offered a competitive base salary. The
performance of each executive will be reviewed annually. Following the review, the Board may in its sole
discretion increase the salary based on that executive’s performance, productivity and such other matters as it
considers relevant.
Superannuation contributions by the Company are limited to the statutory level of 9.50% (2018: 9.50%) of
wages and salaries.
Short-term incentives
The remuneration of Executives includes short-term incentive bonuses, payable as cash or equity, as part of
their employment conditions based on achieving specific measured objectives. The Board may however
approve discretionary bonuses to executives in relation to certain milestones being achieved.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
14
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
Long-term incentives
The Company has in place an Employee Equity Plan for the benefit of Directors, full-time and part-time staff
members employed by the Company. There are options currently on issue under the plan.
The Company is currently in the process of reviewing the structure of this plan and will implement a new long-
term incentive plan in FY2020.
Performance based remuneration
Performance based remuneration is issued to reward individual performance in line with Group objectives.
Consequently, performance-based remuneration is paid to an individual where the individual’s performance
clearly contributes to a successful outcome for the Group. This is regularly measured in respect of
performance against key performance indicators (“KPI’s”) and incentive bonuses are paid monthly, quarterly
and yearly to reflect this.
KPI’s used to measure performance include, but are not limited to:
• Completion of set milestones.
• EBIT target achievements.
• Sales target achievements.
KPI’s are set in advance in conjunction with Group targets and in consultation with Executives and
employees. The KPI’s chosen reflect the Group’s goals for the year and endeavour to increase shareholder
wealth.
Assessment of KPI’s is undertaken by the Board and Executive Management based on management
accounts and year end audited financial results.
All Executives and employees are eligible to receive incentives whether through employment contracts or by
recommendation of the Chief Executive Officer or Board. Performance based incentive payments are based
on a set monetary value or number of shares or options. There is no fixed portion between incentive and
base remuneration.
Remuneration policy versus Group Performance
The Group’s remuneration policy is based on industry practice. Executive performance-based remuneration
issued during the 2019 financial year has been measured against the KPI’s set at the start of the year by the
Board and/or Executive Management to reflect the Group’s objectives for the year. The Board believes that
the performance-based remuneration issued to executives during the year reflects the contribution that they
have made to the Group’s performance over the past 12 months.
Service agreements
The Group has entered into service agreements with Key Management Personnel. Details of these
agreements are contained in Part D of this report.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
15
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
B
Details of remuneration
Details of the remuneration of the Directors, the Key Management Personnel of the Group (as defined in
AASB 124: Related Party Disclosures) are set out in the tables below:
2019
Non-Executive Directors
Leath Nicholson
Brian Austin
Simon Moore
Anthony Day
Hugh Robertson
Executive Directors
Raymond Malone
Andrew Hopkins
Raymond Smith-Roberts
Executive Management
Steven Becker
Ashley Killick
Short-term benefits
Bonus1
Salary
$
$
Other2
Long-term
benefits3
Post-
employment
benefits4
Equity settled
benefits5
Total
$
$
$
$
$
100,000
100,000
58,333
58,333
8,333
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
100,000
100,000
58,333
58,333
8,333
1,020,210
900,000
300,040
-
450,000
575,234
700,000
100,000
58,250
15,818
-
4,562
20,040
-
25,000
-
-
500,000
1,756,068
1,450,000
1,463,086
164,250
180,000
225,000
-
-
150,000
-
-
14,206
-
-
-
403,456
330,000
2,889,499
1,250,234
1,008,250
20,380
59,246
500,000
5,727,609
Notes:
1 - Represents short term incentives paid or accrued
2 - Other includes FY2019’s amortisation of Mr Malone’s sign-on payment received by Mr Malone in a previous year ($500,000), amounts
paid in respect of motor vehicle allowances and Mr Killick’s termination payment ($150,000)
3 - Represents movement in the provision for long service leave for amounts accrued and not paid
4 - Represents amounts paid for pension and superannuation benefits
5 - Represents the non-cash accounting charge to the Company’s operating result relating to FY2018 and FY2019 amortisation of sign-on
payment issued in shares to Mr Smith-Roberts - refer to following sections for further details
2018
Non-Executive Directors
Leath Nicholson
Brian Austin
Hugh Robertson
Executive Directors
Raymond Malone6
Andrew Hopkins
Raymond Smith-Roberts
Executive Management
Ashley Killick
Short-term benefits
Bonus1
Salary
$
$
Other2
Long-term
benefits3
Post-
employment
benefits4
Equity settled
benefits5
Total
$
$
$
$
$
100,000
100,000
100,000
-
-
-
-
-
-
-
-
-
-
-
-
974,577
900,000
300,040
650,000
590,000
155,379
500,000
100,000
-
79,328
-
5,252
20,048
-
25,000
344,435
200,000
-
-
30,820
2,819,052
1,595,379
600,000
84,580
75,868
-
-
-
-
-
-
-
-
100,000
100,000
100,000
2,223,953
1,590,000
485,671
575,255
5,174,879
16
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
Notes:
1 - Represents short term incentives paid or accrued
2 - Other includes a sign-on payment received by Mr Malone on commencement of a new employment contract ($500,000) and amounts
paid in respect of motor vehicle allowances
3 - Represents movement in the provision for long service leave for amounts accrued and not paid
4 - Represents amounts paid for pension and superannuation benefits
5 - Represents the non-cash accounting charge to the Company’s operating result relating to prior year share issues, to compensate for
sign on bonuses, and options granted in the current year - refer to following sections for further details
6 - Mr Malone is entitled to an additional bonus of $400,000 that is payable dependent on the achievement of certain specified financial
targets and Board approval
In the current financial year, Mr Raymond Smith-Roberts was issued ordinary shares as consideration for
committing to an amendment and extension of his employment contract. These shares are conditional on him
remaining employed by the group over the term of the revised contract. The agreement with Mr Raymond
Smith-Roberts was entered into on 21 September 2017 but was subject to shareholder approval. On 22
November 2018, shareholders approved the shares to be issued. The expense of $500,000 includes
$250,000 relating to FY2018’s allocation which was deferred due to the requirement for shareholder approval
at the 2018 Annual General Meeting.
C Share-based compensation
Equity Holdings
Fully Paid Ordinary Quoted Shares
The number of shares in the Company held during the financial year by each director and other members of
Key Management Personnel of the Group, including their related parties, is set out below:
Opening Balance
Balance on
Appointment
Balance on
Retirement
Other Changes Closing Balance
2019
Raymond Malone
Andrew Hopkins
Raymond Smith-Roberts
Leath Nicholson
Brian Austin
Simon Moore
Anthony Day
Hugh Robertson
Steven Becker
Ashley Killick
76,451,350
50,341,667
5,081,684
1,673,395
112,000
-
-
280,000
-
-
-
-
-
-
-
20,025,000
-
-
-
-
-
-
-
-
-
-
-
(280,000)
-
-
(40,136,001)1
(16,780,425)2
1,090,2753
-
-
-
100,0004
-
50,0005
-
36,315,349
33,561,242
6,171,959
1,673,395
112,000
20,025,000
100,000
-
50,000
-
133,940,096
20,025,000
(280,000)
(55,676,151)
98,008,945
Notes:
1 - 36,315,349 shares disposed of through off-market transfer. Further 3,820,651 shares disposed of through off-market transfer
subject to family court order.
2 - Shares disposed of through off-market transfer.
3 - Shares acquired per Resolution 7A at 2018 Annual General Meeting.
4 - Shares acquired through open market trade on 17 May 2019.
5 - Shares acquired through open market trade via nominee.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
17
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
2018
Raymond Malone
Andrew Hopkins
Raymond Smith-Roberts
Leath Nicholson
Brian Austin
Hugh Robertson
Opening Balance
Balance on
Appointment
Balance on
Retirement
Other Changes Closing Balance
80,417,619
35,239,167
5,081,684
1,673,395
112,000
280,000
122,803,865
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(3,966,269)1
15,102,5002
-
-
-
-
76,451,350
50,341,667
5,081,684
1,673,395
112,000
280,000
11,136,231
133,940,096
Notes:
1 - Shares disposed of through off-market transfer subject to family court order.
2 - Shares acquired through conversion on 22 November 2017 of Fully Paid Ordinary Unquoted Shares.
Fully Paid Ordinary Unquoted Shares
On his appointment as an Executive Director, on 17 December 2015, Mr Andrew Hopkins and his related
parties, held an interest in 8,367,500 ordinary unquoted shares in the Company. On 19 August 2016, a
related entity of Mr Hopkins acquired a further interest in this class of shares in AMA Group Limited bringing
his interest to be 15,102,500 Fully Paid Ordinary Unquoted shares. On 22 November 2017, on achieving the
performance targets associated with these securities, these shares were converted to Fully Paid Ordinary
Quoted Shares.
Options over Fully Paid Ordinary Quoted Shares
On 14 September 2015, the Board agreed to the issue of unquoted options to Directors as part of their
remuneration package. At the General Meeting of AMA shareholders held on 27 November 2015, the
shareholders approved the issue of 10,000,000 options to Mr Raymond Malone and 2,000,000 options to Mr
Raymond Smith-Roberts. The terms of the options include a nil consideration price with an exercise price of
$1.20 each. The options vest 12 months from the date of Shareholder Approval (i.e. 27 November 2016) and
expire 3 years from issue date (i.e. 27 November 2018). Each option is convertible into 1 fully paid ordinary
share in the Company and upon exercise will be quoted and will rank equally with all other fully paid ordinary
shares. Mr Raymond Malone and Mr Raymond Smith-Roberts did not exercise their options and on 27
November 2018, the options lapsed.
On 25 April 2016, Mr Ashley Killick was issued with 2,000,000 options to acquire ordinary shares in the
Company. The terms of the options include a nil consideration price with an exercise price of $1.20 each. The
options vest 12 months from the date of issue (i.e. 25 April 2017) and expire 3 years from issue date (i.e. 25
April 2019). Each option is convertible into 1 fully paid ordinary share in the Company and upon exercise will
be quoted and will rank equally with all other fully paid ordinary shares. The options were cancelled on 30
October 2018.
On 26 November 2018, Mr Ashley Killick was issued with a further 2,000,000 options to acquire ordinary
shares in the Company. The terms of the options include a nil consideration price with an exercise price of
$1.20 each. The options vest 12 months from the date of issue (i.e. 26 November 2019) and expire 2.4 years
from issue date (i.e. 25 April 2021). Each option is convertible into 1 fully paid ordinary share in the Company
and upon exercise will be quoted and will rank equally with all other fully paid ordinary shares.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
18
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
D Service agreements
The Group has entered into service agreements with Key Management Personnel. It is a standard
requirement of these contracts that no individual, during the term of their employment agreement, shall
perform work for any other person, corporation or business without the prior written consent of the Company.
Specific details of the service agreements for Key Management Personnel in place as at 30 June 2019 are:
Name:
Raymond Malone
Title:
Agreement commenced:
Agreement extended:
Term of original agreement:
Term of extension:
Other terms:
Executive Chairman
4 July 2010
1 July 2012
5 Years
5 Years
On 28 September 2017, the Company and Mr Malone agreed to continue
his employment on an ongoing basis with the following variations:
(i) The base remuneration was increased to $950,000 per annum; and
(ii) The arrangement may be terminated by either party after giving twelve
months written notice.
On 28 November 2018, Raymond Malone ceased being the Group Chief
Executive Officer.
Name:
Andrew Hopkins
Title:
Agreement commenced:
Term of agreement:
Termination period:
Termination payment:
Other terms:
Name:
Title:
Agreement commenced:
Agreement extended:
Term of extension:
Term of original agreement:
Other terms:
Executive Director and Group Chief Executive Officer
16 December 2015
5 Years
None
None
Mr Hopkins is employed as the Key Person under a consultancy services
agreement with an entity that is a related party to him.
On 28 September 2017, the Company and the related party agreed to
increase the base consultancy fee to $900,000 plus GST per annum plus a
motor vehicle allowance of $100,000 per annum.
Raymond Smith-Roberts
Executive Director and Chief Executive Officer of Automotive Components
and Accessories
1 September 2010
1 July 2012
5 Years
No fixed term
On 28 September 2017, the Company and Mr Smith-Roberts agreed to
continue his employment on an ongoing basis with the following variations:
(i) The remuneration package remained the same subject to the short-
term incentive entitlement being subject to adjustment if additional
responsibilities were added in the future; and
(ii) The arrangement may be terminated by either party after giving twelve
months written notice.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
19
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
Name:
Leath Nicholson
Title:
Agreement commenced:
Term of agreement:
Termination period:
Termination payment:
Other terms:
Non-Executive Director
23 December 2015
Ongoing
None
Nil
None
Name:
Brian Austin
Title:
Agreement commenced:
Term of agreement:
Termination period:
Termination payment:
Other terms:
Non-Executive Director
23 December 2015
Ongoing
None
Nil
None
Name:
Simon Moore
Title:
Agreement commenced:
Term of agreement:
Termination period:
Termination payment:
Other terms:
Non-Executive Director
28 November 2018
Ongoing
None
Nil
None
Name:
Anthony Day
Title:
Agreement commenced:
Term of agreement:
Termination period:
Termination payment:
Other terms:
Non-Executive Director
28 November 2018
Ongoing
None
Nil
None
Name:
Hugh Robertson
Title:
Agreement commenced:
Term of agreement:
Termination period:
Termination payment:
Other terms:
Non-Executive Director
2 June 2015
Resigned 3 August 2018
None
Nil
None
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
20
AMA GROUP LIMITED
(ACN 113 883 560)
REMUNERATION REPORT
FOR THE YEAR ENDED 30 JUNE 2019
Name:
Steven Becker
Title:
Agreement commenced:
Term of agreement:
Termination period:
Termination payment:
Other terms:
Current Chief Financial Officer
4 February 2019
Ongoing
Nil
Nil
None
Name:
Ashley Killick
Title:
Agreement commenced:
Term of agreement:
Termination period:
Termination payment:
Other terms:
Previous Chief Financial Officer
1 July 2018
Resigned 30 October 2018
Nil
Nil
None
Generally, the Company or the individual may terminate employment at any time by giving the other party
appropriate contractual notice in writing.
If either the Company or the individual gives notice of termination, the Company may, at its discretion, choose
to terminate the individual’s employment immediately or at any time during the notice period and pay the
individual an amount equal to the salary due for the residual period of notice at the time of termination.
The employment of each individual may be terminated immediately without notice or payment in lieu in the
event of any serious or persistent breach of the agreement, any serious misconduct or wilful neglect of duties,
in the event of bankruptcy or any arrangement or compensation being made with creditors, on conviction of a
criminal offence, permanent incapacity of the individual or a consistent failure to carry out duties in a manner
satisfactory to the Company.
End of audited Remuneration Report.
This Directors’ Report, incorporating the Remuneration Report, is signed in accordance with a resolution of
the Board of Directors.
Andrew Hopkins
Director
26 August 2019
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
21
Auditor’s Independence Declaration under Section 307C of the Corporations Act
2001 to the directors of AMA Group Limited
I declare that, to the best of my knowledge and belief, during the year ended 30 June 2019 there have been:
(i)
No contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation
to the audit, and
(ii) No contraventions of any applicable code of professional conduct in relation to the audit.
ShineWing Australia
Chartered Accountants
Nick Michael
Partner
Melbourne, 26 August 2019
ShineWing Australia ABN 39 533 589 331. Liability limited by a scheme approved under Professional Standards Legislation. ShineWing Australia is an independent member of ShineWing
International Limited – members in principal cities throughout the world.
22
AMA GROUP LIMITED
(ACN 113 883 560)
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 30 JUNE 2019
CONSOLIDATED INCOME STATEMENT
Revenue from continuing operations
4
616,174
509,756
Note
30 Jun 2019
$’000
30 Jun 2018
$’000
Raw materials and consumables used
Employment benefits expense
Occupancy expense
Professional services expense
Travel and motor vehicle expense
Advertising and marketing expense
Information technology expense
Communication expense
Insurance expense
Other expense
Earnings before interest, tax, depreciation, amortisation and
impairment (EBITDA)
Depreciation, amortisation and impairment expense
Earnings before interest and tax (EBIT)
Finance costs
Share of net profit from associates using the equity method
Profit from continuing operations before fair value
adjustments
Fair value adjustments
Profit before income tax from continuing operations
Loss before tax from discontinued operations
Profit before income tax
Income tax expense
Net profit
Profit attributable to
Members of AMA Group Limited
Non-controlling interests
Earnings per Share
From continuing operations
Basic earnings per share
Diluted earnings per share
From continuing and discontinuing operations
Basic earnings per share
Diluted earnings per share
5
31
6
22
33
33
33
33
(261,267)
(238,261)
(44,089)
(5,481)
(4,227)
(2,806)
(2,118)
(1,421)
(1,163)
(5,214)
50,127
(16,208)
33,919
(2,595)
-
31,324
117
31,441
(232)
31,209
(9,460)
21,749
21,553
196
21,749
(221,214)
(190,923)
(33,963)
(6,856)
(3,753)
(1,929)
(1,835)
(1,159)
(697)
(3,794)
43,633
(15,460)
28,173
(786)
(1,744)
25,643
(951)
24,692
(5)
24,687
(9,318)
15,369
15,105
264
15,369
Cents
Cents
4.00
4.00
3.97
3.97
2.88
2.78
2.88
2.78
23
The above consolidated income statement is to be read in conjunction with the attached notes.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
AMA GROUP LIMITED
(ACN 113 883 560)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2019
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Note
30 Jun 2019
$’000
30 Jun 2018
$’000
Net profit
21,749
15,369
Other Comprehensive Income
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Other comprehensive income, net of tax
(63)
(63)
(50)
(50)
Total comprehensive income, net of tax
21,686
15,319
Total comprehensive income attributable to:
Members of AMA Group Limited
Non-controlling interests
22
21,490
196
15,055
264
21,686
15,319
The above consolidated statement of comprehensive income is to be read in conjunction with the attached notes.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
24
AMA GROUP LIMITED
(ACN 113 883 560)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT THE YEAR ENDED 30 JUNE 2019
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Note
30 Jun 2019
$’000
30 Jun 2018
$’000
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Income tax receivable
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Deferred tax asset
Other non-current assets
Financial assets at amortised cost
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Income tax payable
Provisions
Other current liabilities
Total current liabilities
Non-current liabilities
Financial liabilities at amortised cost
Provisions
Other non-current liabilities
Deferred tax liability
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Retained earnings/(deficit)
Total Group interest
Non-controlling interest
Total equity
7
8
9
6
10
11
12
13
10
14
15
6
17
18
16
17
18
19
20
21
22
12,096
48,124
40,978
-
9,294
110,492
63,340
263,056
13,210
7,253
2,044
348,903
459,395
66,341
4,713
23,038
37,099
131,191
80,568
10,224
42,289
2,650
135,731
266,922
192,473
200,263
46
(8,128)
192,181
292
192,473
16,214
44,753
29,402
188
3,442
93,999
55,421
199,769
9,223
2,280
2,162
268,855
362,854
67,220
-
18,955
12,789
98,964
52,500
6,944
30,115
3,254
92,813
191,777
171,077
187,206
3,004
(19,429)
170,781
296
171,077
The above consolidated statement of financial position is to be read in conjunction with the attached notes.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
25
AMA GROUP LIMITED
(ACN 113 883 560)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2019
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Note
Equity Reserves
$’000
$’000
Retained
Earnings
$’000
Total
$’000
Non
Control
Interest
$’000
Total
$’000
At 1 July 2017
181,691
3,054
(22,122)
162,623
232
162,855
Profit for the period
Other comprehensive
income
Total comprehensive
income for the period
Transactions with owners
in their capacity as
owners:
Shares issued, net of costs
Employee equity plan
Dividends recognised
23
-
-
-
-
15,105
15,105
264
15,369
(50)
-
(50)
-
(50)
(50)
15,105
15,055
264
15,319
5,015
500
-
5,515
-
-
-
-
-
-
(12,412)
5,015
500
(12,412)
-
-
(200)
5,015
500
(12,612)
(12,412)
(6,897)
(200)
(7,097)
As at 30 June 2018
187,206
3,004
(19,429)
170,781
296
171,077
At 1 July 2018
187,206
3,004
(19,429)
170,781
296
171,077
Profit for the period
Other comprehensive
income
Total comprehensive
income for the period
Transactions with owners
in their capacity as
owners:
Shares issued, net of costs
Employee equity plan
Lapsed options
Dividends recognised
23
-
-
-
-
21,553
21,553
196
21,749
(63)
-
(63)
-
(63)
(63)
21,553
21,490
196
21,686
11,807
1,250
-
-
-
153
(3,048)
-
-
-
3,048
(13,300)
11,807
1,403
-
(13,300)
-
-
-
(200)
11,807
1,403
-
(13,500)
13,057
(2,895)
(10,252)
(90)
(200)
(290)
As at 30 June 2019
200,263
46
(8,128)
192,181
292
192,473
The above consolidated statement of changes in equity is to be read in conjunction with the attached notes.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
26
AMA GROUP LIMITED
(ACN 113 883 560)
CONSOLIDATED STATEMENT OF CASHFLOWS
FOR THE YEAR ENDED 30 JUNE 2019
CONSOLIDATED STATEMENT OF CASHFLOWS
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Interest and other costs of finance paid
Income taxes paid
Note
30 Jun 2019
$’000
30 Jun 2018
$’000
602,375
(572,898)
389
(2,595)
(7,794)
496,496
(462,211)
398
(786)
(9,423)
Net cash flows provided by operating activities
32
19,477
24,474
Cash flows from investing activities
Proceeds from sale of property plant and equipment
Proceeds from disposal of business
Payments for purchases of property plant and equipment
Payments for intangible assets
Payments for businesses acquired, net of cash acquired
Loans and other investments
158
150
(10,885)
(4)
(37,871)
1,095
398
167
(11,026)
(18)
(36,836)
(2,003)
Net cash flows used in investing activities
(47,357)
(49,318)
Cash flows from financing activities
Equity raised
Proceeds from borrowings
Repayment of borrowings
Dividends paid to AMA shareholders
Dividends paid to non-controlling shareholders
32
32
22
9,509
52,750
(24,934)
(13,300)
(200)
(51)
43,000
(3,913)
(12,412)
(200)
Net cash flows provided by financing activities
23,825
26,424
Net (decrease) / increase in cash and cash equivalents
(4,055)
1,580
Cash and cash equivalents, at beginning of year
16,214
14,723
Effects of exchange changes on the balances held in foreign
currencies
(63)
(89)
Cash and cash equivalents at the end of year
7
12,096
16,214
The above consolidated statement of cash flows is to be read in conjunction with the attached notes.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
27
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
NOTES TO THE FINANCIAL STATEMENTS
Index of Notes to the Financial Statements
Note 1
Note 2
Note 3
Note 4
Note 5
Note 6
Note 7
Note 8
Note 9
Significant Accounting Policies ..................................................................................................... 29
Critical Accounting Estimates and Judgements ............................................................................ 49
Segment Information ..................................................................................................................... 51
Revenue ........................................................................................................................................ 54
Expenses....................................................................................................................................... 54
Income Tax Expense .................................................................................................................... 55
Cash and Cash Equivalents .......................................................................................................... 56
Trade and Other Receivables ....................................................................................................... 56
Inventories ..................................................................................................................................... 57
Note 10
Other Assets ................................................................................................................................. 58
Note 11
Property, Plant and Equipment ..................................................................................................... 58
Note 12
Intangible Assets ........................................................................................................................... 59
Note 13
Deferred Tax Asset ....................................................................................................................... 63
Note 14
Financial Assets at Amortised Cost .............................................................................................. 64
Note 15
Trade and Other Payables ............................................................................................................ 64
Note 16
Financial Liabilities at Amortised Cost .......................................................................................... 64
Note 17
Provisions ...................................................................................................................................... 66
Note 18
Other Liabilities ............................................................................................................................. 67
Note 19
Deferred Tax Liability .................................................................................................................... 69
Note 20
Contributed Equity ......................................................................................................................... 69
Note 21
Reserves ....................................................................................................................................... 70
Note 22
Non-Controlling Interests .............................................................................................................. 71
Note 23
Dividends....................................................................................................................................... 72
Note 24
Financial Instruments .................................................................................................................... 72
Note 25
Share-Based Payments ................................................................................................................ 78
Note 26
Related Party Transactions ........................................................................................................... 79
Note 27
Contingent Liabilities ..................................................................................................................... 82
Note 28
Commitments for Expenditure....................................................................................................... 83
Note 29
Investments in Controlled Entities ................................................................................................. 84
Note 30
Business Combinations ................................................................................................................. 85
Note 31
Discontinued Operations ............................................................................................................... 87
Note 32
Reconciliation of Cash Flows ........................................................................................................ 88
Note 33
Earnings per Share ....................................................................................................................... 89
Note 34
Parent Information ......................................................................................................................... 90
Note 35
Deed of Cross Guarantee Disclosures ......................................................................................... 91
Note 36
Events Occurring after the Reporting Period ................................................................................ 95
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
28
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies
1 (a) Basis of preparation
1 (a) (i) Basis of accounting
This general purpose financial report, for the year ended 30 June 2019, has been prepared in accordance
with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative
pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001, for AMA
Group Limited (“AMA” or the “Company”) and its controlled entities as a consolidated group (the “Group”).
The Group is a for-profit entity for financial reporting purposes under Australian Accounting Standards.
Compliance with Australian Accounting Standards ensures that the financial statements comply with
International Financial Reporting Standards (IFRS).
This general-purpose financial report has been prepared on a going concern basis, which assumes that the
Group will be able to meet its debts as and when they become due and payable. As at 30 June 2019, the
financial report shows current liabilities exceeding current assets by $20.7 million. This is impacted by the
significant non-cash items in other current liabilities; namely the unamortised Deferred Income and the scrip
component of Contingent Vendor Consideration. Adjusting for these items, this becomes an excess of current
liabilities over current assets of $2.4 million.
1 (a) (ii) Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all controlled entities in the
Group as at 30 June 2019 and the results of all controlled entities for the year then ended. A list of the
controlled entities is provided in Note 29 to these financial statements.
The group controls an entity when the group is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power to direct the activities of
the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the group. They
are deconsolidated from the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the group.
Intercompany transactions, balances and unrealised gains on transactions between group companies are
eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment
of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure
consistency with the policies adopted by the group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated
statement of profit or loss, statement of comprehensive income, statement of changes in equity and balance
sheet respectively.
1 (a) (iii) Historical cost convention
These financial statements have been prepared under the historical cost convention, as modified where
applicable by the revaluation of financial assets and liabilities at fair value through profit or loss and certain
classes of property, plant and equipment.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
29
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (a) (iv) Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
When the Group applies an accounting policy retrospectively, makes a retrospective restatement or
reclassifies items in its financial statements, a statement of financial position as at the beginning of the earliest
comparative period will be disclosed.
1 (a) (v) Rounding amounts
The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors Reports)
Instrument 2016/191 and in accordance with that Instrument, amounts in the financial statements have been
rounded off to the nearest thousand dollars, or in certain cases, to the nearest dollar.
1 (a) (vi) Critical Accounting Estimates
The preparation of these financial statements in conformity with Australian Accounting Standards requires the
use of certain critical accounting estimates. It also requires Management to exercise its judgement in the
process of applying the Group'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 to these financial statements.
1 (b) Summary 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.
1 (b) (i) Foreign currency transactions and balances
Functional and presentation currency
The functional currency of each of the Group’s entities is measured using the currency of the primary
economic environment in which that entity operates. The consolidated financial statements are presented in
Australian dollars, which is the Company’s functional and presentation currency.
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at
the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate.
Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the
transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when
fair values were determined.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
30
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (i) Foreign currency transactions and balances (continued)
Exchange differences arising on the translation of monetary items are recognised in the statement of
comprehensive income, except where deferred in equity as a qualifying cash flow or net investment hedge.
Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the
extent that the gain or loss is directly recognised in equity; otherwise the exchange difference is recognised in
the statement of comprehensive income.
1 (b) (ii) Revenue recognition
Impact of adoption of AASB 15 Revenue from Contracts with Customers
AASB 15 Revenue from Contracts with Customers became effective for periods beginning on or after 1
January 2018. Accordingly, the Group applied AASB 15 for the first time for the year ended 30 June 2019.
Changes to the Group’s accounting policies arising from these standards are summarised below.
AASB 15 supersedes AASB 111 Construction Contracts, AASB 118 Revenue and related Interpretations and
it applies to all revenue arising from contracts with customers, unless those contracts are in the scope of other
standards. The new standard establishes a five-step model to account for revenue arising from contracts with
customers. Under AASB 15, revenue is recognised at an amount that reflects the consideration to which an
entity expects to be entitled in exchange for transferring goods or services to a customer.
The standard requires entities to exercise judgement, taking into consideration all of the relevant facts and
circumstances when applying each step of the model to contracts with their customers.
(a) Rendering of services
The Group operates a number of vehicle panel repair shops which provide services contracted for by
insurance companies. Revenue in respect of these services is recognised as each stage of the vehicle repair
process is completed. Under AASB 15, the Group concluded that revenue from these services will continue to
be recognised over time, using an output method to measure progress towards complete satisfaction of the
service similar to the previous accounting policy, because the customer simultaneously receives and
consumes the benefits provided by the Group.
(b) Sale of goods
The group is also a manufacturer and wholesale distributor of alloy vehicle protection equipment, automotive
and electrical accessories products. The Group’s contracts with customers for the sale of its products
generally include one performance obligation. The Group has concluded that revenue from sale of goods
should be recognised at the point in time when control of the asset is transferred to the customer, generally on
delivery of the goods. Therefore, the adoption of AASB 15 did not have an impact on the timing of revenue
recognition.
As the introduction of this standard did not have any material impact on the Group’s financial statements,
accordingly there are no retrospective adjustments.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
31
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (ii) Revenue recognition (continued)
New Accounting Standard adopted by the Group from 1 July 2018
Revenue from contracts with customers is recognised so as to depict the transfer of promised services to
customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange
for those goods or services.
Revenue is recognised in accordance with the following five-step process:
Identifying the contract with the customer.
Identifying the performance obligations in the contract.
1.
2.
3. Determining the transaction price.
4. Allocating the transaction price to the performance obligations in the contract.
5. Recognising revenue as and when the performance obligations are satisfied.
Panel Repair Services
Revenue arising from these services relate to performance obligations satisfied over time and as such
recognised on progressive basis. Output method is used to recognise revenue from such contracts on the
basis of amounts invoiced to the customer for the services rendered during the period. This is because
management believes that the amounts invoiced represent the value of output transferred to the customer.
Estimates of revenues, costs or extent of progress toward completion are revised if circumstances change.
Any resulting increases or decreases in estimated revenues or costs are reflected in profit or loss in the period
in which the circumstances that give rise to the revision become known by management. Jobs completed and
yet to be invoiced are reflected as a receivable until billed. Customers are typically invoiced on a monthly
basis and consideration is payable when invoiced.
Sale of goods - wholesale
The group manufactures and sells a range of goods in the wholesale market. Sales are recognised when
control of the products has transferred, being when the products are delivered to the wholesaler, the
wholesaler has full discretion over the channel and price to sell the products, and there is no unfulfilled
obligation that could affect the wholesaler’s acceptance of the products. Delivery occurs when the products
have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the
wholesaler, and either the wholesaler has accepted the products in accordance with the sales contract, the
acceptance provisions have lapsed, or the group has objective evidence that all criteria for acceptance have
been satisfied.
Some goods are sold with retrospective volume discounts based on aggregate sales over a specified period.
Revenue from these sales is recognised based on the price specified in the contract, net of the estimated
volume discounts. Accumulated experience is used to estimate and provide for the discounts, using the
expected value method, and revenue is only recognised to the extent that it is highly probable that a
significant reversal will not occur.
A receivable is recognised when the goods are delivered as this is the point in time that the consideration is
unconditional because only the passage of time is required before the payment is due.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
32
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (ii) Revenue recognition (continued)
Sale of goods – retail
The group sells automotive accessory products both online and through retail premises. Revenue from the
sale of goods is recognised when a group entity sells a product to the customer. Payment of the transaction
price is due immediately when the customer purchases the goods.
Interest revenue
This revenue is recognised using the effective interest method. It includes amortisation of any discount or
premium.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established. Grants
and subsidies are recognised as income over the period to which they relate.
Contract assets and receivables
The group presents any unconditional rights to consideration separately as a receivable while those rights
arising from satisfaction of performance obligations in a contract are presented as contract assets. A right to
consideration is unconditional if only the passage of time is required before payment of that consideration is
due. Contract assets are measured at the actual amount of transaction price.
1 (b) (iii) Income tax
The income tax expense/(income) for the year comprises current income tax expense/(income) and deferred
tax expense/(income).
Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated
using applicable income tax rates enacted, or substantially enacted, as at the end of the reporting period.
Current tax liabilities/(assets) are therefore measured at the amounts expected to be paid to/(recovered from)
the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances
during the year as well as unused tax losses.
Current and deferred income tax expense/(income) is charged or credited directly to equity instead of the
profit or loss when the tax relates to items that are credited or charged directly to equity.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also
result where amounts have been fully expensed but future tax deductions are available. No deferred income
tax will be recognised from the initial recognition of an asset or liability, excluding a business combination,
where there is no effect on accounting or taxable profit or loss.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
33
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (iii) Income tax (continued)
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when
the asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at the end of
the reporting period. Their measurement also reflects the manner in which Management expects to recover
or settle the carrying amount of the related asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent
that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset
can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint
ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the temp-
orary difference can be controlled and it is not probable that the reversal will occur in the foreseeable future.
Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended
that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur.
Deferred tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax
assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable
entity or different taxable entities where it is intended that net settlement or simultaneous realisation and
settlement of the respective asset and liability will occur in future periods in which significant amounts of
deferred tax assets or liabilities are expected to be recovered or settled.
Tax consolidation
AMA Group Limited and its wholly-owned Australian subsidiaries have formed an income tax consolidated
group under tax consolidation legislation. Each entity in the Group recognises its own current and deferred tax
assets and liabilities. Such taxes are measured using the ‘stand-alone taxpayer’ approach to allocation.
Current tax liabilities /(assets) and deferred tax assets arising from unused tax losses and tax credits in the
subsidiaries are immediately transferred to the head entity. The Group notified the Australian Taxation Office
that it had formed an income tax consolidated group to apply from 1 September 2006.
1 (b) (iv) 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, and bank
overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the statement of financial
position.
1 (b) (v) Inventories
Costs incurred in bringing each product to its present location and condition are accounted for, as follows:
• Raw materials: purchase cost on a first-in/first-out basis
• Finished goods and work in progress: cost comprises direct materials, direct labour and an appropriate
proportion of variable and fixed overhead expenditure
Costs of purchased inventory are determined after deducting rebates and discounts received or receivable.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
34
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (vi) Property, plant and equipment
Each class of property, plant and equipment is carried at cost or fair value less any accumulated depreciation.
The carrying amount of plant and equipment is reviewed annually to ensure it is not in excess of the
recoverable amount from these assets.
Depreciation is calculated on either a straight line or diminishing value basis (class or asset must have either
a straight line or diminishing value not both) as considered appropriate to write off the net cost or re-valued
amount of each item of plant and equipment over its expected useful life to the Group. The expected useful
lives are as follows:
Leasehold improvements
The cost of improvements to or on leasehold properties is amortised over the unexpired life of the lease or the
estimated useful life of the improvement to the Group, whichever is the shorter.
Plant and equipment
The expected useful life of purchased plant and equipment is two to fifteen years. Where items of plant and
equipment have separately identifiable components which are subject to regular replacement, those
components are assigned useful lives distinct from the item of plant and equipment to which they now relate.
Furniture and equipment
The expected useful life of furniture and equipment is two to ten years.
Motor vehicles
The expected useful life of motor vehicles is four to eight years.
1 (b) (vii) Leases
A distinction is made between finance leases which effectively transfer from the lessor to the lessee
substantially all the risks and benefits incidental to ownership of leased non-current assets, and operating
leases under which the lessor effectively retains substantially all such risks and benefits.
Finance leases are capitalised. A lease asset and liability are established at the present value of minimum
lease payments. Lease payments are allocated between the principal component of the lease liability and
the finance costs.
The leased asset is depreciated on a straight-line basis over the term of the lease, or where it is likely that the
Group will obtain ownership of the asset, the life of the asset. Leased assets held at the reporting date are
being amortised over periods ranging from three to five years.
Other operating lease payments are charged to the statement of comprehensive income in the period in which
they are incurred, as this represents the pattern of benefits derived from the leased assets.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
35
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (viii) Intangible assets
Goodwill
Goodwill is carried at cost less accumulated impairment losses. Goodwill is calculated as the excess of the
sum of:
the consideration transferred;
•
• any non-controlling interest; and
•
the acquisition date fair value of any previously held equity interest, over the acquisition date fair value of
net identifiable assets acquired.
The value of goodwill recognised on acquisition of each subsidiary in which the Group holds less than a 100%
interest will depend on the method adopted in measuring the aforementioned non-controlling interest. The
Group can elect to initially measure the non-controlling interest in the acquiree either at fair value (full goodwill
method) or at the non-controlling interest’s proportionate share of the subsidiary’s identifiable net assets
(proportionate interest method). The Group determines which method to adopt for each acquisition based on
the entitlement of non-controlling interest to a proportionate share of the subsidiary net assets.
Under the full goodwill method, the fair values of the non-controlling interests are determined using valuation
techniques which make the maximum use of market information where available. Under this method, goodwill
attributable to the non-controlling interests is recognised in the consolidated financial statements.
Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill on acquisition of associates
is included in investments in associates.
Goodwill is tested for impairment annually and is allocated to the Group’s cash generating units or groups of
cash generating units, which represent the lowest level at which goodwill is monitored but where such level is
not larger than an operating segment. Gains and losses on the disposal of an entity include the carrying
amount of goodwill related to the entity sold.
Changes in the ownership interests in a subsidiary are accounted for as equity transactions and do not affect
the carrying values of goodwill.
Research and Development
Expenditure on research activities, undertaken with the prospect of obtaining new or scientific or technical
knowledge and understanding, is recognised in the Statement of Comprehensive Income as an expense
when it is incurred.
Expenditure on development activities, being the application of research findings or other knowledge to a plan
or design for the production of new or substantially improved products or services before the start of
commercial product or use, is capitalised only when technical feasibility studies identify that the product or
service will deliver future economic benefits and these benefits can be measured reliably. Expenditure on
development activities have a finite life and are amortised on a systematic basis matched to the future
economic benefits over the useful economic life of the product or service.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
36
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (viii) Intangible assets (continued)
Patents and trademarks
Patents and trademarks are recognised at the cost of acquisition. Patents and trademarks have a finite life
and are carried at cost less accumulated amortisation and any impairment losses. Patents and trademarks
are amortised over their estimated useful life of 5 years.
Customer contracts
Customer contracts are recognised at the fair value at acquisition. Customer contracts have a finite life and
are carried at cost less accumulated amortisation and any impairment losses. Customer contracts are
amortised over the lesser of the remainder of the contract or their estimated useful life relevant to each
specific contract.
1 (b) (ix) Impairment of non-financial assets
At the end of each reporting period, the Group assesses whether there is any indication that an asset may be
impaired. The assessment will include the consideration of external and internal sources of information. If
such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount
of the asset, being the higher of the asset’s fair value less costs to sell and value in use, to the asset’s
carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the
statement of comprehensive income.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
1 (b) (x) Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the
financial year and which are unpaid. The amounts are unsecured and are usually paid within 30-45 days of
recognition. Other payables not due within a year are measured less cumulative amortisation calculated
using the effective interest method.
1 (b) (xi) Onerous leases
Represents contracts entered into in which the unavoidable costs of meeting the obligations under the
contract exceed the economic benefits expected to be received under it. The excess of the lease obligations
over the expected economic benefits is expensed in the period that the contract becomes onerous. The
liability represents the present value of the minimum lease payments and is held on the statement of financial
position until it is extinguished.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
37
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (xii) Finance costs
Finance costs are recognised as expenses in the period in which they are incurred. Finance costs include
interest on:
• Short term and long term borrowings
• Finance leases
1 (b) (xiii) Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past
event, it is probable the Group will be required to settle the obligation, and a reliable estimate can be made of
the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration
required to settle the present obligation at the end of the reporting period, taking into account the risks and
uncertainties surrounding the obligation.
1 (b) (xiv) Employee benefits
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits, and annual leave expected to be wholly
settled within 12 months of the end of the reporting period are recognised in other payables and provisions in
respect of employees' services up to the end of the reporting period and are measured at the amounts
expected to be paid when the liabilities are wholly settled.
Long service leave
The liability for long service leave is recognised in provisions and is measured as the present value of
expected future payments to be made in respect of services provided by employees up to the reporting date
at present value. Consideration is given to expected future wage and salary levels, experience of employee
departures and periods of service.
Share-based payments
Equity-settled share-based payments are measured at fair value at the date of grant. Fair value is measured
by use of an option pricing model. The expected value used in the model is adjusted, based on Management’s
best estimate, for the effects of non-transferability, exercise restrictions, other risk factors and behavioural
considerations.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a
straight-line basis over the vesting period, based on the Group’s estimate of shares that will eventually vest.
For cash-settled share-based payments, a liability equal to the portion of the goods or services received is
recognised at the current fair value determined at the end of the reporting period.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
38
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (xv) Contributed equity
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. Incremental costs directly attributable to the issue of new shares or
options, or for the acquisition of a business, are included in the cost of the acquisition as part of the purchase
consideration.
1 (b) (xvi) Dividends
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at
the discretion of the Company, on or before the end of the financial year but not distributed at the end of the
reporting period.
1 (b) (xvii) Business combinations
Business combinations occur where an acquirer obtains control over one or more businesses and results in
the consolidation of its assets and liabilities.
A business combination is accounted for by applying the acquisition method, unless it is a combination
involving entities or businesses under common control. The acquisition method requires that for each
business combination one of the combining entities must be identified as the acquirer (i.e. the Company). The
business combination will be accounted for as at the acquisition date, which is the date that control over the
acquiree is obtained by the Company. At this date, the Company recognises, in the consolidated accounts,
and subject to certain limited exceptions, the acquisition date fair value of the identifiable assets acquired and
liabilities assumed. In addition, contingent liabilities of the acquiree will be recognised where a present
obligation has been incurred and its fair value can be reliably measured.
The acquisition may result in the recognition of goodwill or a gain from a bargain purchase. The method
adopted for the measurement of goodwill will impact on the measurement of any non-controlling interest to be
recognised in the acquiree where less than 100% ownership interest is held in the acquiree.
The acquisition date fair value of the consideration transferred for a business combination plus the acquisition
date fair value of any previously held equity interest shall form the cost of the investment in the separate
financial statements. Consideration may comprise the sum of the assets transferred by the acquirer, liabilities
incurred by the acquirer to the former owners of the acquiree and the equity interests issued by the acquirer.
Fair value uplifts in the value of pre-existing equity holdings are taken to the statement of comprehensive
income. Where changes in the value of such equity holdings had previously been recognised in other
comprehensive income, such amounts are recycled to profit or loss.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
39
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (xvii) Business combinations (continued)
Included in the measurement of consideration transferred is any asset or liability resulting from a contingent
consideration arrangement. Any obligation incurred relating to contingent consideration is classified as either
a financial liability or equity instrument, depending upon the nature of the arrangement. Rights to refunds of
consideration previously paid are recognised as a receivable. Subsequent to initial recognition, contingent
consideration classified as equity is not remeasured and its subsequent settlement is accounted for within
equity. Contingent consideration classified as an asset or a liability is remeasured each reporting period to fair
value through the statement of comprehensive income unless the change in value can be identified as
existing at acquisition date.
All transaction costs incurred in relation to the business combination are expensed to the statement of
comprehensive income.
1 (b) (xviii) Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of
ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued
during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take
into account the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of shares assumed to have been issued for no
consideration in relation to dilutive potential ordinary shares.
1 (b) (xix) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST
incurred is not recoverable from the Australian Taxation Office (ATO). In this case it is recognised as part of
the cost of 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 ATO 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 ATO, are presented as operating cash flows.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
40
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (xx) Financial instruments
Impact of adoption of AASB 9 Financial Instruments
AASB 9 Financial Instruments became effective for periods beginning on or after 1 January 2018.
Accordingly, the Group applied AASB 9 for the first time for the year ended 30 June 2019. Changes to the
Group’s accounting policies arising from these standards are summarised below.
AASB 9 Financial Instruments replaces AASB 139’s ‘Financial Instruments: Recognition and Measurement’
for annual periods beginning on or after 1 January 2018, bringing together all three aspects of the accounting
for financial instruments: classification and measurement; impairment; and hedge accounting. It makes major
changes to the previous guidance on the classification and measurement of financial assets and introduces
an ‘expected credit loss’ model for impairment of financial assets.
On 1 July 2018 (the date of initial application of AASB 9), the group’s management has assessed which
business models apply to the financial assets held by the group and has classified its financial instruments
into the appropriate AASB 9 categories. The assessment of whether contractual cash flows on debt
instruments are solely comprised of principal and interest was made based on the facts and circumstances as
at the initial recognition of the assets. The main effects resulting from this reclassification are as follows:
Table 1: Changes in classification and measurement on transition to AASB 9
Financial instrument
as at 30 Jun 2018
AASB 139
classification and
measurement
AASB 9
classification and
measurement
Trade and other
receivables
Loans to related
parties (Vendor loans)
Borrowings
Trade and other
payables
Contingent
consideration liabilities
Loans and
receivables at
amortised cost
Loans and
receivables at
amortised cost
Financial liability at
amortised cost
Financial liability at
amortised cost
Fair Value through
Profit & Loss
Financial assets at
amortised cost
Financial assets at
amortised cost
Financial liability at
amortised cost
Financial liability at
amortised cost
Fair Value through
Profit & Loss
Carrying
amount as at 30
Jun 2018 under
AASB 139
Carrying
amount as at 1
Jul 2019 under
AASB 9
44,753
44,753
2,162
2,162
(52,832)
(52,500)
(67,220)
(67,220)
(35,493)
(35,493)
The accounting for the Group’s financial liabilities remains largely the same as it was under AASB 139. Similar
to the requirements of AASB 139, AASB 9 requires contingent consideration liabilities to be treated as
financial instruments measured at fair value, with the changes in fair value recognised in the statement of
profit or loss.
There is no impact on retained profits from the transition to AASB 9 since there has been no change in the
measurement basis of the Group’s financial instruments. There is no reconciliation of loss allowance since
there was no material change to this account.
The Group’s adoption of AASB 9 has not had a material effect on the Group.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
41
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (xx) Financial instruments (continued)
New Accounting Standard adopted by the Group from 1 July 2018
Classification and measurement
The Group initially measures financial assets and liabilities at fair value plus, in the case of a financial
instrument not at fair value through profit or loss, transaction costs.
Under AASB 9, debt financial instruments are subsequently measured at fair value through profit or loss
(FVPL), amortised cost, or fair value through other comprehensive income (FVOCI). The classification is
based on two criteria: the Group’s business model for managing the assets; and whether the instruments’
contractual cash flows represent ‘solely payments of principal and interest’ on the principal amount
outstanding (the ‘SPPI criterion’).
Financial assets
The classification and measurement of the Group’s debt financial assets are, as follows:
Debt instruments at amortised cost for financial assets that are held within a business model with the objective
to hold the financial assets in order to collect contractual cash flows that meet the SPPI criterion. This
category includes the Group’s Trade and other receivables, and Loans included under Other non-current
financial assets.
Amortised cost is calculated as:
the amount at which the financial asset or financial liability is measured at initial recognition;
less principal repayments;
•
•
• plus or minus the cumulative amortisation of the difference, if any, between the amount initially recognised
and the maturity amount calculated using the effective interest method; and
less any reduction for impairment.
•
The effective interest method is used to allocate interest income or interest expense over the relevant period
and is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees,
transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably
predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or
financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying
value with a consequential recognition of an income or expense in profit or loss.
Debt instruments at FVOCI, with gains or losses recycled to profit or loss on derecognition. Financial assets in
this category are the Group’s quoted debt instruments that meet the SPPI criterion and are held within a
business model both to collect cash flows and to sell.
Other financial assets are classified and subsequently measured, as follows:
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
42
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (xx) Financial instruments (continued)
Equity instruments at FVOCI, with no recycling of gains or losses to profit or loss on derecognition. This
category only includes equity instruments, which the Group intends to hold for the foreseeable future and
which the Group has irrevocably elected to so classify upon initial recognition or transition. The Group
classified its unquoted equity instruments as equity instruments at FVOCI. Equity instruments at FVOCI are
not subject to an impairment assessment under AASB 9.
Financial assets at FVPL comprise derivative instruments and quoted equity instruments which the Group had
not irrevocably elected, at initial recognition or transition, to classify at FVOCI. This category includes debt
instruments whose cash flow characteristics fail the SPPI criterion or are not held within a business model
whose objective is either to collect contractual cash flows, or to both collect contractual cash flows and sell.
Financial liabilities
Trade and other payables represent liabilities for goods and services provided to the Group prior to the end of
the financial year and which are unpaid. The amounts are unsecured and are usually paid within 30-45 days
of recognition. Other payables not due within a year are measured less cumulative amortisation calculated
using the effective interest method.
Loans are initially recognised at their fair value plus transaction costs. Interest is accrued over the period it
becomes due and unpaid interest is recorded as part of current payables.
Interest free loans are recorded at their fair value. Discounted cash flow models are used to determine the fair
values of the loans.
All non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised
cost.
Fair value
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are
applied to determine the fair value for all unlisted financial instruments, including recent arm’s length
transactions, reference to similar instruments and option pricing models.
Impairment
Impairment of financial assets is recognised based on the lifetime expected credit loss which is determined
when the credit risk on a financial asset has increased significantly since initial recognition. In order to
determine whether there has been a significant increase in credit risk since initial recognition, the entity
compares the risk of default as at the reporting date with risk of default as at initial recognition using
reasonable and supportable data, unless the financial asset is determined to have low credit risk at the
reporting date.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
43
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (b) (xx) Financial instruments (continued)
Contract Assets and Trade and other receivables
For Contract Assets and Trade and other receivables (both classified as current and non-current), the
Group has applied the standard’s simplified approach and has calculated ECLs based on lifetime
expected credit losses. The Group has established a provision matrix that is based on the Group’s
historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the
economic environment.
De-recognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the
asset is transferred to another party whereby the entity no longer has any significant continuing
involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised
where the related obligations are discharged, cancelled or expired. The difference between the
carrying value of the financial liability extinguished or transferred to another party and the fair value of
consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in
profit or loss.
1 (b) (xxi) Non-current assets held for sale and discontinued operations
Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be
recovered principally through a sale transaction rather than through continuing use and a sale is considered
highly probable. They are measured at the lower of their carrying amount and fair value less costs to sell,
except for assets such as deferred tax assets, assets arising from employee benefits, financial assets and
investment property that are carried at fair value and contractual rights under insurance contracts, which are
specially exempt from this requirement.
An impairment loss is recognised for any initial or subsequent write-down of the asset (or disposal group) to
fair value less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell
of an asset (or disposal group), but not in excess of any cumulative impairment loss previously recognised. A
gain or loss not previously recognised by the date of the sale of the non-current asset (or disposal group) is
recognised at the date of de-recognition.
Non-current assets (including those that are part of a disposal group) are not depreciated or amortised while
they are classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal
group classified as held for sale continue to be recognised. Non-current assets classified as held for sale and
the assets of a disposal group classified as held for sale are presented separately from the other assets in the
statement of financial position. The liabilities of a disposal group classified as held for sale are presented
separately from other liabilities in the statement of financial position.
A discontinued operation is a component of the entity that has been disposed of or is classified as held for
sale and that represents a separate major line of business or geographical area of operations, is part of a
single co-ordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired
exclusively with a view to resale. The results of discontinued operations are presented separately in the
Statement of Comprehensive Income.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
44
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (c) New accounting standards for application in future periods
In the current year, the Group has adopted all of the new and revised Standards and Interpretations issued by
the Australian Accounting Standards Board (the “AASB”) that are relevant to their operations and effective for
annual reporting periods beginning on 1 July 2018.
The adoption of all new and revised Standards and Interpretations did not affect the amounts reported for the
current or prior periods. In addition, the new and revised Accounting Standards and Interpretations have not
had a material impact and not resulted in change to the Group’s presentation of or disclosure in these
financial statements.
Accounting Standards and Interpretations issued by the AASB that are not yet mandatorily applicable to the
Group, together with an assessment of the potential impact of such pronouncements on the Group when
adopted in future periods, are discussed below:
AASB 16: Leases (applicable for annual reporting periods commencing on or after 1 January 2019)
AASB 16 introduces a comprehensive model for the identification of lease arrangements and accounting
treatments for both lessors and lessees. AASB 16 will supersede the current lease guidance including AASB
117 Leases and the related interpretations when it becomes effective. AASB 16 distinguishes leases and
service contracts on the basis of whether an identified asset is controlled by a customer. Distinctions of
operating leases (off balance sheet) and finance leases (on balance sheet) are removed for lessee
accounting, and is replaced by a model where a right-of-use asset and a corresponding liability have to be
recognised for all leases by lessees (i.e. all on balance sheet) except for short-term leases and leases of low
value assets.
The right-of-use asset is initially measured at cost and subsequently measured at cost (subject to certain
exceptions) less accumulated depreciation and impairment losses, adjusted for any remeasurement of the
lease liability. The lease liability is initially measured at the present value of the lease payments that are not
paid at that date. Subsequently, the lease liability is adjusted for interest and lease payments, as well as the
impact of lease modifications, amongst others.
The classification of cash flows will also be affected as operating lease payments under AASB 117 are
presented as operating cash flows; whereas under the AASB 16 model, the lease payments will be split into a
principal and an interest portion which will be presented as financing and operating cash flows respectively.
Furthermore, extensive disclosures are required by AASB 16.
The Group’s assessment indicates that these arrangements will meet the definition of a lease under AASB 16,
and hence the Group will recognise a right-of-use asset and a corresponding liability in respect of all these
leases unless they qualify for low value or short-term leases upon the application of AASB 16.
The new requirement to recognise a right-of-use asset and a related lease liability is expected to have a
significant impact on the amounts recognised in the Group’s consolidated financial statements. The Group will
apply the new standard using the simplified approach from its mandatory adoption date of 1 July 2019 and
has determined that it will recognise a right of use asset in the range of $237.4 million to $244.7 million and a
lease liability in the range of $237.4 million to $244.7 million, with an impact on net assets of $0.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
45
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (c) New accounting standards for application in future periods (continued)
AASB 2017-6 Amendments to Australian Accounting Standards – Prepayment Features with Negative
Compensation (applicable to annual reporting periods beginning on or after 1 January 2019).
This standard amends AASB 9 to clarify that an entity may pay or receive compensation for early termination
of a contract irrespective of the event or circumstance that causes the early termination of the contract and
includes a case where a party chooses to terminate a contract earlier than the contractual term.
The standard requires different disclosures on transition to these amendments when an entity does not apply
these amendments at the same as the date of transition to AASB 9.
This standard is not expected to have a material impact on the financial statements of the Group.
AASB 2017-7 Amendments to Australian Accounting Standards – Long-term Interests in Associates and Joint
Ventures to Australian Accounting Standards (applicable to annual reporting periods beginning on or after 1
January 2019).
This standard amends AASB 128 to clarify that an entity should apply AASB 9 to other long-term interests in
an associate that is equity accounted. When applying AASB 9 the entity should ignore adjustments to the
carrying amount of the long-term interest due to application of AASB 1128.
This standard is not expected to have a material impact on the financial statements of the Group.
AASB 2018-1 Amendments to Australian Accounting Standards – Annual Improvements 2015–2017 Cycle
(applicable to annual reporting periods beginning on or after 1 January 2019).
The Standard amends:
(a) AASB 3 to clarify that an entity remeasures its previously held interest in a joint operation when it obtains
control of the business;
(b) AASB 11 to clarify that an entity does not remeasure its previously held interest in a joint operation when
it obtains joint control of the business;
(c) AASB 112 to clarify that an entity accounts for all income tax consequences of dividend payments
according to where the entity originally recognised the past transactions or events that generated the
distributable profits; and
(d) AASB 123 to clarify that an entity treats any borrowing originally made to develop a qualifying asset as
part of general borrowings when the asset is ready for its intended use or sale.
This standard is not expected to have a material impact on the financial statements of the Group as the
existing accounting policies of the Group are already aligned with the amendments.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
46
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (c) New accounting standards for application in future periods (continued)
AASB 2018-2: Amendments to Australian Accounting Standards – Plan Amendment, Curtailment or
Settlement (applicable to annual reporting periods beginning on or after 1 January 2019).
This amendment Standard amends AASB 119 to clarify how an entity accounts for defined benefit plans when
a plan amendment, curtailment or settlement occurs during a reporting period. The amendments require an
entity to use the assumptions used for the re-measurement of the net defined benefit liability or asset to
determine the current service cost and the net interest for the remainder of the reporting period after a plan
event occurs. The Standard also clarifies that, when a plan event occurs, an entity recognises the past service
cost or a gain or loss on settlement separately from its assessment of the asset ceiling
This standard is not expected to have a material impact on the financial statements of the Group as the
existing accounting policies of the Group are already aligned with the amendments.
AASB 2018-6: Amendments to Australian Accounting Standards – Definition of a Business (applicable to
annual reporting periods beginning on or after 1 January 2020).
The Standard amends AASB 3 to clarify the definition of a business, assisting entities to determine whether a
transaction should be accounted for as a business combination or as an asset acquisition. The amendments:
(a) clarify that to be considered a business, an acquired set of activities and assets must include, at a
minimum, an input and a substantive process that together significantly contribute to the ability to create
outputs;
(b) remove the assessment of whether market participants are capable of replacing any missing inputs or
processes and continuing to produce outputs;
(c) add guidance and illustrative examples to help entities assess whether a substantive process has been
acquired;
(d) narrow the definitions of a business and of outputs by focusing on goods and services provided to
customers and by removing the reference to an ability to reduce costs; and
(e) add an optional concentration test that permits a simplified assessment of whether an acquired set of
activities and assets is not a business.
Earlier application of the standard is permitted.
This standard is prospectively applicable to transactions with acquisition date occurring on or after the
beginning of the first annual reporting period commencing on or after 1 January 2020. The directors are not
aware of any material contractual arrangements that would result in asset acquisitions occurring on or after 1
July 2020 and that are expected to be impacted by this amendment.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
47
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 1
Significant Accounting Policies (continued)
1 (c) New accounting standards for application in future periods (continued)
Revised Conceptual Framework and related amendments under AASB 2019-1 (applicable to annual reporting
periods beginning on or after 1 January 2020).
Among the many changes brought about by the revised conceptual framework issued by AASB, the following
are some of the key changes:
• New definitions for the terms ‘prudence’ and ‘measurement certainty’;
• New description of the scope and objective of financial statements and redefining the term ‘reporting
entity’. A reporting entity is an entity that chooses or is required to prepare financial statements and not
necessarily a legal entity;
• Altogether new definition for the term ‘assets’, ‘liabilities’ and ‘income and expenses’; More guidance on
deciding the ‘unit of account’ and regarding executory contracts;
• New definition for the terms ‘recognition’ and ‘de-recognition’;
•
Introduction of two measurement basis viz. historical measurement basis and current value measurement
basis such as fair value, value in use, fulfilment value and current cost; and
• Guidance on presentation and disclosure of income and expenses in P/L and OCI (including subsequent
recycling to P/L).
This standard is prospectively applicable to the entity for annual reporting periods beginning on or after 1 July
2020. Although the directors expect there may be material impact on account of the new conceptual
framework, it is impracticable to determine a reasonable impact on application of the new conceptual
framework.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
48
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 2
Critical Accounting Estimates and Judgements
Estimates and judgements are continually evaluated and are based on historical experience and other factors,
including expectations of future events that may have a financial impact on the Group and that are believed to
be reasonable under the circumstances.
Critical accounting estimates and assumptions
When preparing the financial statements, Management undertakes various judgements, estimates and
assumptions concerning the recognition and measurement of assets, liabilities, income and expenses. The
resulting accounting estimates will, by definition, seldom equate with the related actual results. The following
are significant judgements, estimates and assumptions made in applying the accounting policies of the Group
that have the most significant effect on the financial statements.
Impairment of Goodwill
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating
units to which goodwill has been allocated. The value in use calculation requires the Group to estimate the
future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to
calculate present value. Refer to Note 12 for details of key assumptions used to calculate the recoverable
amount of goodwill. The Group is yet to finalise the acquisition accounting for certain of its current year
acquisitions and will seek to do so over the twelve months post acquisition. The value attributed to Goodwill
may therefore change in future periods.
Fair value of Contingent vendor consideration
The carrying value of the Contingent vendor consideration, payable as a result of the acquisition of
businesses and entities, incorporate a number of assumptions. In determining this value, Management have
applied a discount factor and a probability factor on the earn-out components to determine the fair value. The
interest expense and the fair value adjustment have been taken to the Statement of Comprehensive Income.
The fair value of this contingent consideration liability is measured using a discounted cash flow methodology
applying the Group’s cost of capital. In making this assessment, it has been assumed, that where the
arrangement is subject to a cap, the business will meet the pre-specified target and the maximum will be
payable. Where the arrangement is not subject to a cap, Management have determined an estimate of the
likely outcome, based on the possible average profit outcomes that may be achieved, weighted by the
probability of each scenario.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
49
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 2
Critical Accounting Estimates and Judgements (continued)
Share-based payments plans
The cost of share-based payments plans (including options) is determined on the basis of the fair value of the
equity instrument at grant date. Determining the fair value assumes choosing the most suitable valuation
model for these equity instruments, by which the characteristics of the grant have a decisive influence. This
assumes also the input into the valuation model of some relevant judgments, like the estimated expected life
of the option and the volatility of the underlying share.
Provision for Make Good
Provisions for Make Good are measured at the present value of management’s best estimate of the
expenditure required to remove any leasehold improvements at the end of the respective lease. The discount
rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time
value of money and the risks specific to the liability.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
50
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 3
Segment Information
The Group has identified its operating segments based on the internal reports that are reviewed and used by
the Board and Executive Management in assessing performance and determining the allocation of resources.
The Group is managed primarily on the basis of product category and service offerings since the
diversifications of the Group’s operations inherently have notably different risk profiles and performance
assessment criteria. Operating segments are therefore determined on the same basis.
Reportable segments disclosed are based on aggregating operating segments where the segments are
considered to have similar economic characteristics with respect to the products sold and/or services provided
by the segment.
The Group only operates within one geographical area, Australasia, and has historically been segmented by
the products it provides, being:
• Vehicle Panel Repair - Motor vehicle panel repairs.
• Manufacturing - Manufacture of motor vehicle protection products and Ute/Commercial accessories.
• Distribution - Distribution of automotive electrical & 4WD accessories.
• Remanufacturing - Motor vehicle component remanufacturing & repairs.
• Workshop - automotive workshops and performance products.
Unless stated otherwise, all amounts reported with respect to operating segments are determined in
accordance with the Group’s accounting policies. All inter-segment transactions are eliminated on
consolidation for the Group’s financial statements.
Where an asset is used across multiple segments, the asset is allocated to the segment that receives the
majority of economic value from the asset. In the majority of instances, segment assets are clearly identifiable
on the basis of their nature and physical location.
Liabilities are allocated to segments where there is direct nexus between the incurrence of the liability and the
operations of the segment. Borrowings and tax liabilities are generally considered to relate to the Group as a
whole and are not allocated. Segment liabilities include trade and other payables and certain direct
borrowings.
The following items of revenue, expense, assets and liabilities are not allocated to operating segments, as
they are not considered part of the core operations of any segment:
income tax expense;
• non-recurring items of revenue or expense;
•
• deferred tax assets and liabilities;
• other financial liabilities;
•
fixed manufacturing & service costs and other cost of sales adjustments;
finance costs;
•
• dividend payments;
•
intangible assets; and
• discontinued operations.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
51
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 3
Segment Information (continued)
Revenue from two customers amounted to $266.2 million (2018: $238.6 million), arising from sales in the
Vehicle Panel Repair segment.
Year to 30 June 2019
Revenue
External sales
Other income
Panel
$’000
Manu-
facturing
$’000
Distribution Remanu-
facturing
$’000
$’000
Workshop
Total
$’000
$’000
517,268
50,308
17,026
11,454
6,034
602,090
12,106
1,484
177
253
31
14,051
Total sales & other income
529,374
51,792
17,203
11,707
6,065
616,141
Unallocated revenue
Total revenue
Result
EBITDA
Unallocated expenses
Depreciation, amortisation and impairment expense
Finance costs
Fair value adjustments
Share of net profit from associates using equity method
Profit from continuing operations before income tax
Net assets as at 30 June 2019
Segment assets
Unallocated assets
Total assets
Segment liabilities
Unallocated liabilities
Total liabilities
Net Assets
33
616,174
46,623
10,656
587
2,458
232
60,556
(10,429)
(16,208)
(2,595)
117
-
31,441
371,279
32,841
11,526
4,772
786
421,204
38,191
459,395
(127,802)
(7,642)
(2,296)
(1,894)
(779)
(140,413)
(126,509)
(266,922)
192,473
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
52
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 3
Segment Information (continued)
Year to 30 June 2018
Revenue
External sales
Other income
Panel
$’000
Manu-
facturing
$’000
Distribution Remanu-
facturing
$’000
$’000
Workshop
Total
$’000
$’000
427,078
37,391
17,183
11,599
3,901
497,152
8,997
957
186
242
44
10,426
Total sales & other income
436,075
38,348
17,369
11,841
3,945
507,578
Unallocated revenue
Total revenue
Result
EBITDA
Unallocated expenses
Depreciation, amortisation and impairment expense
Finance costs
Fair value adjustments
Share of net profit from associates using equity method
Profit from continuing operations before income tax
Net assets as at 30 June 2018
Segment assets
Unallocated assets
Total assets
Segment liabilities
Unallocated liabilities
Total liabilities
Net Assets
2,178
509,756
39,202
7,671
1,249
2,446
136
50,704
(7,071)
(15,460)
(786)
(951)
(1,744)
24,692
280,401
48,066
12,166
5,316
1,121
347,070
15,784
362,854
(91,272)
(9,285)
(2,383)
(1,768)
(927)
(105,635)
(86,142)
(191,777)
171,077
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
53
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 4
Revenue
Sales revenue
Sale of goods
Panel Repair services
Other services
Other revenue
Interest received
Amortisation of deferred income
Gain on acquisition
Other revenue
30 Jun 2019
$’000
30 Jun 2018
$’000
76,149
523,610
2,331
602,090
88
9,419
-
4,577
14,084
69,068
427,057
1,027
497,152
93
7,453
2,108
2,950
12,604
Total revenue from continuing operations
Total revenue from discontinued operations
616,174
1,893
509,756
1,421
Note 5
Expenses
30 Jun 2019
$’000
30 Jun 2018
$’000
(a) Profit before income tax includes the following specific expenses:
Rental expense relating to operating leases (minimum lease payments)
Defined contribution superannuation expense
Executive equity plan expense
Consulting and advisory expense
Bad and doubtful debts expense / (recovery)
Loss / (profit) on disposal of assets
Depreciation and amortisation expense
- Depreciation of property, plant & equipment
- Amortisation of intangible assets
Impairment expense - goodwill
Interest and finance charges paid / payable
28,806
17,621
1,499
5,060
(46)
(15)
12,258
3,950
-
2,595
22,678
13,990
853
6,496
(81)
(5)
10,049
3,303
2,108
786
(b) Fees paid or payable to ShineWing Australia (the Company’s Auditors) or its related practices:
Fees paid in respect of audit or review of the financial reports totalled $421,050 (2018: $360,037).
There were no other services provided by ShineWing Australia for the year ended 30 June 2019 or
30 June 2018.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
54
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 6
Income Tax Expense
Income tax expense:
Current tax payable/(receivable)
Businesses acquired during the year
Current year tax instalments paid during the year
Deferred tax
(Over)/Under provision in respect of prior year
Other
Deferred tax included in income tax expense comprises:
Decrease/(increase) in deferred tax assets 13
(Decrease)/increase in deferred tax liabilities 19
Reconciliation of prima facie tax payable to income tax expense:
Profit before income tax (expense)/benefit
Tax at the Australian tax rate of 30%
Tax effect amounts which are not deductible/(taxable) in calculating
taxable income:
Employee equity plan
Impairment
Fair value adjustments
Non-deductible professional services fees
Share of net profit of associate accounted for by the equity method
Other
(Over)/Under provision in respect of prior year
Income tax expense
Income tax expense attributable to:
- Members of the Company
- Non-controlling interests
Income tax expense
Income tax expense attributable to:
- Continuing operations
- Discontinued operations (refer to Note 31)
Income tax expense
Note 30 Jun 2019
$'000
30 Jun 2018
$'000
4,713
170
8,307
(3,432)
(41)
(257)
9,460
(2,821)
(611)
(3,432)
(188)
-
9,400
141
(38)
3
9,318
375
(234)
141
31,209
24,687
9,363
7,406
26
-
(35)
147
-
-
(41)
9,460
9,376
84
9,460
9,530
(70)
9,460
-
632
285
1,143
523
(633)
(38)
9,318
9,204
114
9,318
9,320
(2)
9,318
The applicable weighted average effective tax rates are as follows:
30.3%
37.8%
The Group is part of a tax consolidation group. See the income tax accounting policy in Note 1.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
55
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 7
Cash and Cash Equivalents
Cash on hand
Cash at bank
Note 8
Trade and Other Receivables
Current
Trade receivables
Loss allowance
Other receivables
30 Jun 2019
$'000
30 Jun 2018
$'000
121
11,975
12,096
104
16,110
16,214
30 Jun 2019
$'000
30 Jun 2018
$'000
29,770
(190)
29,580
18,544
48,124
35,434
(259)
35,175
9,578
44,753
There were no non-current trade or other receivables in either reported year.
Bad and doubtful trade receivables
The Group has recognised a loss allowance of $190,000 (2018: $259,000) in respect of bad and doubtful
trade receivables during the year ended 30 June 2019.
Impairment of receivables
The ageing of the loss allowance for trade receivables recognised above is as follows:
3 to 6 months
Over 6 months
30 Jun 2019
$'000
30 Jun 2018
$'000
190
-
190
259
-
259
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
56
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 8
Trade and Other Receivables (continued)
Movements in the loss allowance for trade receivables are as follows:
30 Jun 2019
$'000
30 Jun 2018
$'000
Opening balance
Business acquisition
Additional provisions recognised/(released)
Receivables written off/(back-in) during the year as uncollectible
Discontinuing operations
Closing balance
259
-
(46)
(23)
-
190
269
155
(81)
(78)
(6)
259
Past due but not impaired
The Group has not recognised a loss allowance for the below balances as there has been no significant
change in the customer’s credit quality and the amounts are still considered recoverable. The balances relate
to a number of customers for whom there is no recent history of default.
The ageing of the past due but not impaired receivables is shown below:
1 to 3 months
3 to 6 months
Over 6 months
Closing balance
30 Jun 2019
$'000
30 Jun 2018
$'000
4,497
1,696
-
6,193
5,604
-
-
5,604
Customers with balances past due but without expected credit loss at 30 June 2019 amount to $6.193 million
(2018: $5.604 million). Management do not consider that there is any credit risk on the aggregate balances
after reviewing credit agency information and recognising a tacit extension to the recorded credit terms of
customers based on recent collection practices. The balances of receivables that remain within initial trade
terms (as detailed in table) are considered to be of high credit quality.
Note 9
Inventories
Raw materials and consumables
Work in progress
Finished goods
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
30 Jun 2019
$'000
30 Jun 2018
$'000
21,324
12,215
7,439
40,978
11,881
10,285
7,236
29,402
57
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 10 Other Assets
Current
Deferred Employee Equity Plan
Acquisition Deposits
Prepayments
Non-Current
Deferred Employee Equity Plan
Prepayments
Deposits
Note 11 Property, Plant and Equipment
Leasehold improvements - at cost
Less accumulated amortisation
Plant & equipment - at cost
Less accumulated depreciation
Furniture & equipment - at cost
Less accumulated depreciation
Motor vehicles - at cost
Less accumulated depreciation
30 Jun 2019
$'000
30 Jun 2018
$'000
959
4,000
4,335
9,294
867
786
5,600
7,253
758
-
2,684
3,442
1,264
1,016
-
2,280
30 Jun 2019
$'000
30 Jun 2018
$'000
21,111
(7,705)
13,406
79,535
(36,657)
42,878
5,565
(2,589)
2,976
8,037
(3,957)
4,080
20,441
(5,370)
15,071
61,353
(28,725)
32,628
6,269
(2,311)
3,958
6,206
(2,442)
3,764
63,340
55,421
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
58
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 11 Property, Plant and Equipment (continued)
Movements in the fair values of Property, Plant & Equipment are set out below:
Leasehold
improvements
$'000
Plant &
Equipment
$'000
Furniture &
Fittings
$'000
Motor
vehicles
$'000
Total
$'000
Balance at 1 July 2017
Additions
Business acquisitions
Disposals
Depreciation expense
Discontinued operations
Balance at 30 June 2018
Balance at 1 July 2018
Additions
Business acquisitions
Disposals
Depreciation expense
Asset reclassification
Balance at 30 June 2019
11,788
3,655
537
(34)
(788)
(87)
15,071
15,071
1,822
26
(92)
(20)
(3,401)
13,406
29,345
4,033
8,087
(200)
(8,582)
(55)
32,628
32,628
8,965
7,812
(324)
(11,776)
5,573
42,878
2,373
1,633
426
(91)
(383)
-
3,958
3,958
1,147
27
(124)
(349)
(1,683)
2,976
2,438
1,272
471
(121)
(296)
-
3,764
3,764
811
130
(23)
(113)
(489)
4,080
45,944
10,593
9,521
(446)
(10,049)
(142)
55,421
55,421
12,745
7,995
(563)
(12,258)
-
63,340
Note 12
Intangible Assets
Goodwill - at cost
Less impairment
Patents & Trademarks
Less amortisation
Customer contracts
Less amortisation
30 Jun 2019
$'000
30 Jun 2018
$'000
270,015
(10,652)
259,363
155
(112)
43
16,843
(13,193)
3,650
207,649
(10,652)
196,997
650
(220)
430
11,977
(9,635)
2,342
263,056
199,769
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
59
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 12
Intangible Assets (continued)
Movements in the carrying amounts of Intangible Assets are set out below:
Goodwill
$'000
Patents &
Trademarks
$’000
Customer
Contracts
$’000
Total
$,000
153,049
4
46,226
(174)
(2,108)
-
196,997
196,997
533
61,839
-
(6)
259,363
417
14
7
-
-
(8)
430
430
-
5
(392)
-
43
5,637
-
-
-
-
(3,295)
2,342
2,342
-
4,866
(3,558)
-
3,650
159,103
18
46,233
(174)
(2,108)
(3,303)
199,769
199,769
533
66,710
(3,950)
(6)
263,056
Balance at 1 July 2017
Additions and adjustment
Acquired
Disposed
Impairment expense
Amortisation expense
Balance at 30 June 2018
Balance at 1 July 2018
Additions and adjustment
Acquired
Amortisation expense
FX on translation
Balance at 30 June 2019
Goodwill
Goodwill is allocated to cash-generating units (“CGU”) which are based on the Group’s operating segments:
Vehicle Panel Repair
Manufacturing
Distribution
Remanufacturing
30 Jun 2019
$'000
30 Jun 2018
$'000
225,605
26,949
5,349
1,460
259,363
162,094
28,094
5,349
1,460
196,997
The Group is yet to finalise the acquisition accounting for the majority of its current year acquisitions and the
value attributed to Goodwill may change in future periods.
The recoverable amount of each cash-generating unit above is determined based on value-in-use
calculations. Value-in-use is calculated based on the present value of cash flow projections over a five-year
period with the period extending beyond five years extrapolated using an estimated growth rate. The cash
flows are discounted using the weighted average cost of capital (WACC) (Pre-tax Discount rate) of the
Company at the beginning of the budget period.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
60
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 12
Intangible Assets (continued)
The following key assumptions were used in determining the recoverable amount of goodwill:
Vehicle Panel
Repair
Manufacturing
Distribution Remanufacturing
Pre-tax discount rate %
Year 1 EBITDA growth rate %
Terminal growth rate %
6.60
31.7
2.00
7.10
16.2
2.00
7.90
34.1
2.00
7.90
4.60
2.00
Management has based the value-in-use calculations for the CGUs on budgets and Management’s best
estimates of future growth rates, and what it believes will occur in future years. The value-in-use models are
most sensitive to the following assumptions:
• Discount rate;
• Year 1 EBITDA growth rates; and
• Terminal growth rates.
Discount rates are pre-tax and are adjusted to incorporate risks associated with a particular segment.
Management has based the starting point for the value-in-use calculations on the FY20 budgets for each
reporting segment. These budgets use a combination of historical growth rates and Management’s best
estimates of expected future growth rates. Costs are calculated taking into account historical gross margins
and Management’s best estimates of expected future gross margins, and average inflation, which is
consistent with inflation rates applicable to the locations in which the segments operate.
Management has made the following considerations in respect of the Year 1 EBITDA growth rate:
Segment
Consideration
Vehicle Panel
Repair
Management has factored in the highly acquisitive nature of this division and growth
plans to further consolidate the industry.
Manufacturing
Management has estimated a modest growth in revenue with continued focus on
production efficiencies and manufacturing processes.
Distribution
Management has estimated growth in revenue and an improved margin due to a
continued focus on increasing the quality of revenue and incorporating cost saving
measures. There is further development of new innovative product ranges, continued
evolution of other brand products to our own brands, and expansion of the solar range,
which has been introduced to several of our national retail chain customers bolstering
future supply to the market. There has also been improved cash conversion within the
Distribution segment.
Remanufacturing
Management has estimated conservative growth in revenue with a focus on customer
expansion.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
61
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 12
Intangible Assets (continued)
Impact of possible changes in key assumptions
Distribution Segment
The following table provides quantitative information regarding the key assumptions used in the Distribution
CGU and the impact of possible changes in the key assumptions:
Key Assumption
Change in Key Assumption
Pre-tax discount rate
of 7.90%
Pre-tax discount rate
of 8.90%
Impact of Possible Change in Key
Assumption
If the pre-tax discount rate of 7.90% was
1.00% higher, there would be no sign of
impairment.
Year 1 EBITDA
growth rate of 34.1%
Year 1 EBITDA
growth rate of 0.00%
If the Year 1 EBITDA growth rate was 0.00%,
there would be an indicator of impairment of
$709,000.
Year 1 EBITDA
growth rate of 34.1%
Year 1 EBITDA
growth rate of 5.00%
If the Year 1 EBITDA growth rate was 5.00%,
there would be no sign of impairment.
Terminal growth rate
of 2.00%
Terminal growth rate
of 1.00%
If the terminal growth rate of 2.00% was
1.00% lower, there would be no sign of
impairment.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
62
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 13 Deferred Tax Asset
The balance comprises temporary differences attributable to:
Amounts recognised in the statement of comprehensive income:
Employee benefits
Provisions
Accrued expenses
Inventory
Doubtful debts
Other
Amounts recognised in equity:
Transaction costs on share issue
30 Jun 2019
$'000
30 Jun 2018
$'000
7,929
236
1,054
219
57
3,609
13,104
106
106
6,322
293
689
361
77
866
8,608
615
615
Deferred tax asset
13,210
9,223
Movement:
Carrying amount at beginning of year
Business acquisitions
Business disposal
Credited/(charged) to the statement of comprehensive income
Carrying amount at end of year
9,223
1,166
-
2,821
13,210
7,205
2,448
(55)
(375)
9,223
At 30 June 2019, the Group has estimated un-recouped revenue losses of $334,000 (2018: $334,000) and
estimated un-recouped capital losses of $3,528,900 (2018: $3,528,900) which can be carried forward
indefinitely. None of these losses have been brought to account as a deferred tax asset. The benefit of these
losses will only be obtained if:
• The companies derive future assessable income of a nature and an amount sufficient to enable the
benefits from the deductions for the losses to be realised.
• The companies continue to comply with the conditions for deductibility imposed by the law.
• No changes in tax legislation adversely affect the companies in realising the benefit from the deductions
for the losses.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
63
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 14
Financial Assets at Amortised Cost
Vendor loans
30 Jun 2019
$'000
30 Jun 2018
$'000
2,044
2,044
2,162
2,162
As part of the acquisition of Gemini Accident Repair Centres Pty Ltd in a prior year, the Group acquired loans
to certain vendors of that entity. These loans have not been repaid and it is proposed that they will be
extinguished against future short-term and long-term incentives. The loans are measured at amortised cost
using the effective interest method.
For further details refer to Note 26 Related Party Transactions.
Note 15
Trade and Other Payables
Trade payables
Accrued expenses
Other payables
Note 16
Financial Liabilities at Amortised Cost
Non-current
Bank loan
At year end the Group had unrestricted access to the following lines of credit:
Bank loan facility
Unutilised at balance date
30 Jun 2019
$'000
30 Jun 2018
$'000
49,680
5,301
11,360
66,341
53,357
6,450
7,413
67,220
30 Jun 2019
$'000
30 Jun 2018
$'000
80,568
80,568
52,500
52,500
125,000
44,432
60,000
7,500
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
64
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 16
Financial Liabilities at Amortised Cost (continued)
Financing arrangements
On 24 August 2016, the Company entered into a new Facility Agreement with National Australia Bank Limited.
The key terms of this agreement are:
• a $40 million facility, with a 36 months tenor, to assist in funding acquisitions and general corporate needs;
• a $6.5 million lease facility to assist with the purchase of capital equipment;
• a $3.0 million bank guarantee facility to assist with securing property rental leases; and
• a $0.4 million letter of credit facility.
On 7 February 2018, the Company’s Facility Agreement with the National Australia Bank Limited was
amended to:
• a $40 million facility, with a tenure until 31 August 2019, to assist in funding acquisitions and general
corporate needs;
• a $20 million facility, with a tenure until 31 January 2021, to assist in funding acquisitions and general
corporate needs;
• a $6.5 million lease facility to assist with the purchase of capital equipment;
• a $6.0 million bank guarantee facility to assist with securing property rental leases; and
• a $0.4 million letter of credit facility.
On 17 May 2018, these facilities were further amended to include a $0.15 million credit card facility.
On 29 May 2019, the Company’s Facility Agreement with the National Australia Bank Limited was amended
to:
• a $95 million facility, with a tenure until 31 January 2021, to assist in funding acquisitions and general
corporate needs;
• a $30 million facility, with a tenure until 31 January 2022, to assist in funding acquisitions and general
corporate needs;
• a $15.0 million bank guarantee facility to assist with securing property rental leases;
• a $0.45 million letter of credit facility;
• a $0.15 million credit card facility; and
• a $25 million accordion facility, with a tenure until 31 January 2021, to assist in funding acquisitions and
general corporate needs, if required.
The Facility is secured by a fixed and floating charge over all of the assets of the Company and its wholly
owned subsidiaries and is subject to standard covenants. At year end, the Company was in compliance with
these covenants.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
65
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 17 Provisions
Current
Annual leave
Long service leave
Dividends
Onerous lease
Other
Non-current
Long service leave
Make good
Onerous lease
Movements in provisions
30 Jun 2019
$'000
30 Jun 2018
$'000
15,305
7,092
289
344
8
23,038
4,033
6,117
74
10,224
13,014
5,206
243
492
-
18,955
2,854
3,974
116
6,944
Movements in each class of provision during the current financial year, other than employee benefits, are set
out below:
Dividends
Make
Good
Onerous
Lease
Total
Carrying amount at beginning of year
Arising during the year
Business acquisitions
Utilised
Reversed
Carrying amount at end of year
243
46
-
-
-
289
3,974
1,081
1,132
-
(70)
6,117
608
4,825
-
-
(40)
(150)
418
1,127
1,132
(40)
(220)
6,824
Amounts not expected to be settled within the next 12 months
The current provision for annual leave is presented as current, since the Group does not have an
unconditional right to defer settlement. However, based on past experience, the Group does not expect all
employees to take the full amount of accrued leave within the next 12 months.
The current provision for long service leave includes all unconditional entitlements where employees have
completed the required period of service and also those where employees are entitled to pro-rata payments in
certain circumstances. The entire amount is presented as current, since the Group does not have an
unconditional right to defer settlement. However, based on past experience, the Group does not expect all
employees to take the full amount of accrued long service leave or require payment within the next 12
months.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
66
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 17 Provisions (continued)
The following amounts reflect leave that is classified as a current liability but is not expected to be taken within
the next 12 months:
Annual leave obligation expected to be settled after 12 months
Long service leave obligation to be settled after 12 months
Note 18 Other Liabilities
Current
Deferred income
Contingent vendor consideration
Lease liability
Non-current
Deferred income
Contingent vendor consideration
Lease liability
Deferred Income
30 Jun 2019
$'000
30 Jun 2018
$'000
6,853
836
7,689
1,269
1,096
2,365
30 Jun 2019
$'000
30 Jun 2018
$'000
12,500
24,496
103
37,099
16,061
26,199
29
42,289
7,079
5,399
311
12,789
-
30,094
21
30,115
In a previous financial year, the Group entered into an agreement with a key supplier to purchase product and
services from the supplier over an agreed period of time and receives various preferential benefits; one of
which is a market investment incentive. To satisfy the requirements of this agreement, the Group must
purchase from this supplier in accordance with agreed terms. The incentive is being amortised as this liability
reduces.
During the current year, the Group received a second tranche equal to $30.9 million. At 30 June 2019, an
amount of $12.5 million (2018: $7.1 million) has been classified as current representing the anticipated
reduction in this incentive over the next twelve months.
Lease Liability
The lease liabilities are effectively secured as the rights to the leased assets recognised in the statement of
financial position revert to the lessor in the event of default.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
67
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 18 Other Liabilities (continued)
Contingent vendor consideration
The Company has recorded deferred and contingent consideration to Business Vendors for $53.104 million
(2018: $36.804 million) which, as per the relevant business purchase agreement includes amounts for
performance based earn-outs to be paid in a mixture of shares and cash. The present value of the liability is
$50.695 million (2018: $35.493 million). Refer to Note 24 for further information on how the fair value has
been determined for contingent consideration. An analysis of this liability by type of consideration follows:
Current
Cash Settlement
Share Settlement
Non-Current
Cash Settlement
Share Settlement
Movement:
Carrying amount at beginning of year
Arising during the year
Fair Value adjustment
Payments
Charge to Profit
Carrying amount at end of year
30 Jun 2019
$’000
30 Jun 2018
$’000
18,697
5,799
24,496
26,199
-
26,199
50,695
35,493
33,055
-
(17,736)
(117)
50,695
5,253
146
5,399
24,443
5,651
30,094
35,493
29,624
11,510
(423)
(6,170)
952
35,493
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
68
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 19 Deferred Tax Liability
The balance comprises temporary differences attributable to:
Amounts recognised in statement of comprehensive income:
Sundry debtors
Customer contracts
Deferred tax liability
Movement:
Carrying amount at beginning of year
Business acquisitions
Business disposal
Credited/(charged) to the statement of comprehensive income
Carrying amount at end of year
Note 20 Contributed Equity
30 Jun 2019
$'000
30 Jun 2018
$'000
3,015
(365)
2,650
3,254
7
-
(611)
2,650
2,551
703
3,254
3,509
-
(21)
(234)
3,254
30 Jun 2019
30 Jun 2018
Number
$’000
Number
$’000
Fully Paid Ordinary shares
Quoted
Unquoted
539,166,324
8,355,901
547,522,225
192,163
8,100
200,263
527,440,147
6,276,899
533,717,046
181,106
6,100
187,206
Quoted Fully Paid Ordinary shares entitle the holder to participate in dividends and the proceeds on winding
up the Company in proportion to the number of and amounts paid on the shares held. On a show of hands
every holder of ordinary shares present at a meeting in person or by proxy is entitled to one vote and, upon a
poll, each share is entitled to one vote.
Unquoted Fully Paid Ordinary shares entitle the holder to all the same benefits and responsibilities of holders
of Quoted Fully Paid Ordinary shares with exception that they do not entitle the holder to participate in
dividends or vote at general meetings of the Company. As such they are not listed for trade on the ASX.
They have been issued as part consideration for the acquisition of various entities and are subject to a
restriction period. In the event that the business has met its earnings target at the completion of this
restriction period, the shares are then eligible to participate in dividends.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
69
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 20 Contributed Equity (continued)
Movements in ordinary share capital
Quoted:
Opening balance
Shares issued
Institutional placement
Employee share issues
Vendor share issues
Convert from Unquoted shares
Closing balance
Unquoted:
Opening balance
Shares issued
Vendor share issue
Convert to Quoted shares
Closing balance
Note 21 Reserves
Equity Based Remuneration Reserve
Foreign Exchange Translation Reserve
Equity Based Remuneration Reserve
30 Jun 2019
30 Jun 2018
Number
$’000
Number
$’000
527,440,147
181,106
488,892,102
161,691
10,000,000
1,332,993
393,184
-
539,166,324
9,510
1,250
297
-
192,163
500,158
13,047,887
25,000,000
527,440,147
500
3,915
15,000
181,106
6,276,899
6,100
30,100,428
20,000
2,079,002
-
8,355,901
2,000
-
8,100
1,176,471
(25,000,000)
6,276,899
1,100
(15,000)
6,100
547,522,225
200,263
533,717,046
187,206
30 Jun 2019
$’000
30 Jun 2018
$’000
153
(107)
46
3,048
(44)
3,004
The Equity Based Remuneration Reserve is used to recognise the value of equity-settled share-based
payments provided to employees, including key management personnel, as part of their remuneration.
Foreign Exchange Translation Reserve
The Foreign Exchange Translation Reserve is used to recognise foreign currency translation differences
arising on the translation of financial statements of the Group’s foreign entities into $AUD.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
70
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 22 Non-Controlling Interests
On 1 July 2015, the Group acquired 60.0% of the issued capital of Woods Auto Shops (Dandenong) Pty Ltd;
the operator of the Trackright businesses. The owners of the other 40.0% of issued capital are the
management of the Trackright business. Set out below is summarised financial information for this entity.
30 Jun 2019
$’000
30 Jun 2018
$’000
Summarised balance sheet
Current assets
Current liabilities
Current net assets
Non-current assets
Non-current liabilities
Non-current net assets
Net assets
Accumulated Non-Controlling Interest
Summarised statement of comprehensive income
Revenue
Profit for the period
Other comprehensive income
Total comprehensive income
Profit allocated to Non-Controlling Interest
Dividends paid to Non-Controlling Interest
Summarised cash flows
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Net increase/(decrease) in cash and cash equivalents
Movement:
Opening Balance
Share of result for the period
Dividends paid
Closing Balance
1,015
(1,907)
(892)
2,897
(1,275)
1,622
730
292
6,546
491
-
491
196
200
1,677
(134)
(1,314)
229
296
196
(200)
292
1,237
(1,004)
233
2,192
(1,686)
506
739
296
6,783
659
-
659
264
200
1,368
(88)
(1,398)
(118)
232
264
(200)
296
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
71
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 23 Dividends
Dividends paid or declared during the period ended were:
Final dividend of 2.0 cents per share, fully franked, paid 30 Oct 2017
Interim dividend of 0.5 cents per share, fully franked, paid 15 Jun 2018
Final dividend of 2.0 cents per share, fully franked, paid 13 Nov 2018
Interim dividend of 0.5 cents per share, fully franked, paid 15 May 2019
Franking credits available for subsequent financial years
based on tax rate of 30%
30 Jun 2019
$’000
30 Jun 2018
$’000
-
-
10,595
2,705
13,300
9,786
2,626
-
-
12,412
30,704
18,960
The aforementioned amounts represent the balance of the franking account as at the end of the reporting
period, adjusted for:
•
•
•
franking credits that will arise from the payment of the amount of the provision for income tax
franking credits that will arise from the payment of dividends recognised as a liability at the reporting date
franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date
Note 24
Financial Instruments
Financial risk management
The Group's activities expose it to a variety of financial risks. These include market risk (including foreign
currency risk, price risk and interest rate risk), credit risk, and liquidity risk. The Group'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 Group. The Group 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 risk and ageing analysis for credit risk.
Risk management is carried out by Executive Management under policies approved by the Board. Executive
Management identifies, evaluates and mitigates financial risks within the Group's operating units.
Market risk
Foreign currency risk
The Group continues to make purchases in foreign currencies and is therefore exposed to foreign currency
risk through foreign exchange rate fluctuations.
The carrying amount of the Group's foreign currency denominated financial assets and financial liabilities at
the end of the reporting period are set out below:
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
72
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 24
Financial Instruments (continued)
Consolidated
US Dollar
NZ Dollar
SA Rand
Assets
Liabilities
30 Jun 2019
$'000
30 Jun 2018
$'000
30 Jun 2019
$'000
30 Jun 2018
$'000
140
820
14
974
48
344
-
392
655
101
81
837
316
183
30
529
The Group had financial assets denominated in US Dollars of AUD $140,000 as at 30 June 2019 (2018: AUD
$48,000). Based on this exposure, had the Australian Dollar weakened/strengthened by 10% against the US
Dollar with all other variables held constant, the Group's result for the year and equity would have been
$16,000 higher/lower (2018: A$5,000).
The Group had financial assets denominated in NZ Dollars of AUD $820,000 as at 30 June 2019 (2018: AUD
$344,000). Based on this exposure, had the Australian Dollar weakened/strengthened by 10% against the NZ
Dollar with all other variables held constant, the Group's result for the year and equity would have been
$91,000 higher/lower (2018: A$38,000).
The Group had financial assets denominated in South African Rand of AUD $14,000 as at 30 June 2019
(2018: Nil). Based on this exposure, had the Australian Dollar weakened/strengthened by 10% against the
South African Rand with all other variables held constant, the Group's result for the year and equity would
have been $2,000 higher/lower (2018: Nil).
The Group had financial liabilities denominated in US Dollars of AUD $655,000 as at 30 June 2019 (2018:
AUD $316,000). Based on this exposure, had the Australian Dollar weakened/strengthened by 10% against
the US Dollar with all other variables held constant, the Group's result for the year and equity would have
been $73,000 higher/lower (2018: A$35,000).
The Group had financial liabilities denominated in NZ Dollars of AUD $101,000 as at 30 June 2019 (2018:
AUD $183,000). Based on this exposure, had the Australian Dollar weakened/strengthened by 10% against
the NZ Dollar with all other variables held constant, the Group's result for the year and equity would have
been $11,000 higher/lower (2018: $20,000).
The Group had financial liabilities denominated in South African Rand of AUD $81,000 as at 30 June 2019
(2018: AUD $30,000). Based on this exposure, had the Australian Dollar weakened/strengthened by 10%
against the South African Rand with all other variables held constant, the Group's result for the year and
equity would have been $9,000 higher/lower (2018: $3,000).
There were no assets or liabilities denominated in any other foreign currencies, other than US Dollars, NZ
Dollars or South African Rand as at 30 June 2019 or as at 30 June 2018.
The foreign exchange loss for the year ended 30 June 2019 was $39,000 (2018: $29,000 loss).
The Group does not employ foreign currency hedges and has no official foreign currency policy. If the
transactional value, net asset position and overall exposure were to increase it is likely that a policy will be
adopted to mitigate risk.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
73
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 24
Financial Instruments (continued)
Price risk
The Group and the Company are not exposed to any significant price risk.
Interest rate risk
The Group and the Company's main interest rate risk arises from short and long-term borrowings. All
borrowings are issued at variable rates and this exposes the Group and the Company to interest rate risk.
The Group and the Company attempt to mitigate this interest rate risk exposure by maintaining an adequate
interest cover ratio and gearing ratio that ensures financing costs are not significant costs. At the end of the
financial year, the Group had bank loans outstanding of $80.6 million (2018: $52.5 million).
The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that
portion of loans and borrowings affected. With all other variables held constant, the Group’s profit before tax is
affected through the impact on floating rate borrowings, as follows:
Increase of 50 bps
Decrease of 50 bps
Credit risk
30 Jun 2019
$’000
30 Jun 2018
$’000
(284)
284
(147)
147
Credit risk is managed on a Group basis. Credit risk refers to the risk that a counterparty will default on its
contractual obligations resulting in financial loss to the Group. The Group has a strict code of credit and
obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to credit risk, excluding
the value of any collateral or other security, at the end of the reporting period 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 the Notes to the Financial Statements.
As at 30 June 2019 the Group had no significant concentration of credit risk.
Liquidity risk
The Group 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.
The Group has a process of monitoring overall cash balances on a strategic long term basis and at an
operational level on a weekly basis. This is to ensure ongoing liquidity, prompt decision making and allow
proactive communication with its funders.
The Group’s current focus is to ensure it meets debt covenants, reduces debt, reduces costs and focuses on
its current operations in the automotive aftercare market.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
74
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 24
Financial Instruments (continued)
Financial liability and financial asset maturity analysis
The tables below analyse the Group's financial assets and liabilities into relevant maturity groupings based on
the remaining period between the reporting date and the contractual maturity date. Cash flows realised from
financial assets reflect management's expectations as to the timing of their realisation. Actual timing may
differ from that disclosed. The amounts disclosed in the table are the contractual undiscounted cash flows.
Weighted
average
interest
rate
%
Within 1
year
1 to 5
years
Over 5
years
Total
$'000
$'000
$'000
$'000
2019
Financial assets cash flows realisable
Cash and cash equivalents (Note 7)
Trade and other receivables (Note 8)
Other assets (Note 10)
Financial assets at amortised cost (Note 14)
Total anticipated inflow on financial instruments
Financial liabilities due for payment
Trade and other payables (Note 15)
Financial liabilities at amortised cost (Note 16)
Deferred cash consideration (Note 18)
Lease liabilities (Note 18)
Total expected outflows
Net inflow / (outflow) on financial instruments
4.58%
5.76%
2018
Financial assets cash flows realisable
Cash and cash equivalents (Note 7)
Trade and other receivables (Note 8)
Financial assets at amortised cost (Note 14)
Total anticipated inflow on financial instruments
Financial liabilities due for payment
Trade and other payables (Note 15)
Financial liabilities at amortised cost (Note 16)
Deferred cash consideration (Note 18)
Lease liabilities (Note 18)
Total expected outflows
Net inflow / (outflow) on financial instruments
2.26%
5.76%
12,096
48,124
4,000
-
64,220
-
-
5,600
2,044
7,644
66,341
-
18,697
103
85,141
(20,921)
-
80,568
26,199
29
106,796
(99,152)
16,214
44,753
118
61,085
-
-
2,044
2,044
67,220
-
5,475
317
73,012
(11,927)
-
52,500
31,329
24
83,853
(81,809)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
12,096
48,124
9,600
2,044
71,864
66,341
80,568
44,896
132
191,937
(120,073)
16,214
44,753
2,162
63,129
67,220
52,500
36,804
341
156,865
(93,736)
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
75
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 24
Financial Instruments (continued)
Fair value of financial instruments
The carrying value of financial instruments as shown in the Statement of Financial Position reflects their fair
value. These financial instruments have been analysed and classified using a fair value hierarchy reflecting
the significance of the inputs used in making the measurements. The fair value hierarchy consists of the
following levels:
• quoted prices in active markets for identical assets or liabilities (Level 1);
•
inputs other than quoted prices included within Level 1 that are observable for the asset / liability, either
directly (as prices) or indirectly (derived from prices) (Level 2); and
inputs for the asset / liability that are not based on observable market data (unobservable inputs) (Level 3).
•
The fair value of the financial instruments included in Level 3 of the hierarchy has been determined using
valuation techniques incorporating observable direct and indirect market data relevant to the Company and an
estimation of the probability on paying the full amount.
During the financial year, the Group has acquired various entities and businesses. In undertaking these
acquisitions, the Group has incurred a contingent consideration liability consisting of an obligation to provide
shares in the Company and / or make an additional cash payment to the vendor if the average profits of the
acquisition for the earn-out period exceed a pre-specified target level.
The following table provides quantitative information regarding the significant unobservable inputs, the ranges
of those inputs and the relationships of unobservable inputs to the fair value measurement of the Contingent
Vendor Consideration:
Significant Unobservable
Inputs Used
Unobservable Inputs
Used
If Correct Panel Group failed
to meet its earning target
EBITDA in excess of
$3.2 million per annum
The Correct Panel Group
Discount rate
Discount rate of 3.55%
If Wales Truck Repairs &
Wales Bus Repairs failed to
meet its earning target
EBITDA in excess of
$5.0 million per annum
Estimated Sensitivity of Fair Value
Measurement to Changes
in Unobservable Inputs
If EBITDA was $500,000 higher / lower, the
fair value of the total deferred consideration
would increase / decrease by $500,000 /
$1,562,500
If the discount rate was 0.1% (10 bps) lower,
the fair value of the total deferred
consideration would increase by $7,000
If EBITDA was $500,000 higher / lower, the
fair value of the total deferred consideration
would increase / decrease by $3,000,000 /
$3,000,000
The Wales Truck Repairs &
Wales Bus Repairs
Discount rate
Discount rate of 3.55%
If the discount rate was 0.1% (10 bps) lower,
the fair value of the total deferred
consideration would increase by $39,000
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
76
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 24
Financial Instruments (continued)
Fair value of financial instruments (continued)
Significant Unobservable
Inputs Used
Unobservable Inputs
Used
If Geelong Consolidated
Repairs failed to meet its
earning target
EBITDA in excess of
$2.0 million per annum
The Geelong Consolidated
Repairs Discount rate
Discount rate of 2.60%
If Wells Harvey failed to meet
its earning target
EBITDA in excess of
$3.0 million per annum
The Wells Harvey
Discount rate
Discount rate of 2.63%
If Simply Smashing failed to
meet its earning target
EBIT in excess of
$2.5 million per annum
The Simply Smashing
Discount rate
Discount rate of 2.63%
Estimated Sensitivity of Fair Value
Measurement to Changes
in Unobservable Inputs
If EBITDA was $500,000 higher / lower, the
fair value of the total deferred consideration
would increase / decrease by $2,000,000 /
$2,000,000
If the discount rate was 0.1% (10 bps) lower,
the fair value of the total deferred
consideration would increase by $4,000
If EBITDA was $500,000 higher / lower, the
fair value of the total deferred consideration
would increase / decrease by $750,000 /
$1,250,000
If the discount rate was 0.1% (10 bps) lower,
the fair value of the total deferred
consideration would increase by $7,000
If EBIT was $500,000 higher / lower, the fair
value of the total deferred consideration
would increase / decrease by $1,000,000 /
$2,000,000
If the discount rate was 0.1% (10 bps) lower,
the fair value of the total deferred
consideration would increase by $10,000
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
77
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 24
Financial Instruments (continued)
Capital risk management
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern, so
that it can continue to provide returns for shareholders and benefits for other stakeholders and to maintain an
optimum capital structure to reduce the cost of capital. The Group’s capital includes ordinary share capital,
debt facilities, vendor loans and lease liabilities supported by financial assets. There are no externally
imposed capital requirements. The Group may issue new shares or sell assets to either reduce debt or to
invest in income producing assets. This is decided on the basis of maximising shareholder returns over the
long term.
Debt
Financial liabilities at amortised cost
Lease Liabilities
Contingent vendor consideration
Cash & cash equivalents
Net debt
Fully Paid Ordinary Shares
Quoted (at market price)
Unquoted (at issue price)
Total capital
Gearing ratio
Note
30 Jun 2019
$'000
30 Jun 2018
$'000
16
18
18
7
80,568
132
50,695
(12,096)
119,299
771,008
8,100
779,108
52,500
332
35,493
(16,214)
72,111
551,175
6,100
557,275
898,407
629,386
13.28%
11.46%
Fully Paid Ordinary Shares Quoted value has been calculated using the closing share prices as at 30 June
each year.
Note 25 Share-Based Payments
On 14 September 2015, the Company agreed to the new AMA Group Limited Employee Equity Plan (the
“Employee Equity Plan”). It was subsequently approved by shareholders at the annual general meeting held
on 27 November 2015. It replaces the old Employee Share Option Plan which was last approved by
Shareholders at the 2013 AGM. The Employee Equity Plan was adopted by the Board to ensure it meets the
July 2015 changes to Australian Taxation laws regarding deferred taxation on employee options and
performance rights and to adopt the requirements of ASIC Class Order 14/1000.
The Employee Equity Plan is for the benefit of all staff members employed by the Group, including Directors
and Executive Management. Under the Employee Equity Plan an eligible participant is invited to accept a
right to receive a share or option.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
78
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 25 Share-Based Payments (continued)
Shares
During the year ended 30 June 2019, the Company issued fully paid ordinary shares to employees in
consideration of these employees agreeing to enter into long term contracts with the Company and accepting
significant post-employment restraint provisions. These 1,332,993 shares were issued for non-cash
consideration at an average deemed price of $0.9377 per share.
Options
During the year ended 30 June 2016, 18,875,000 options were issued. Each option vested after 12 months,
and was exercisable at $1.20 each over the subsequent 24 months and then convertible into 1 Fully Paid
Ordinary Quoted Share in the Company. As detailed in the Remuneration Report, 14,000,000 of these
options had been issued to Key Management Personnel. All of these options lapsed during the current
financial year unexercised.
During the current financial year, 2,000,000 options were issued to a Key Management Personnel on
termination of their employment. Each option was issued for nil consideration and is exercisable for $1.20
each. The options vest 12 months from issue and expire on 25 April 2021. Each option is convertible into 1
fully paid ordinary quote share in the Company. As the options had not vested at the end of the financial year,
they remain unexercised.
The fair value of the options granted to the employee have been valued using the black-scholes pricing
methodology using the following assumptions:
$0.076
$1.20
$0.90
2.4 years
25%
2.47%
2.02%
Fair Value
Exercise Price
Share Price
Expected Life of the Option
Expected Volatility
Expected Dividend Yield
Risk Free Rate
Note 26 Related Party Transactions
The Company and its Controlled Entities
The ultimate holding entity is AMA Group Limited.
Investments in Controlled Entities are set out in Note 29.
Terms and conditions
All transactions were made at arm’s length, or on terms that are less favourable to the related party, except for
loans to subsidiaries which are non-interest bearing.
Key Management Personnel
Further disclosures relating to Key Management Personnel are set out in the audited Remuneration Report.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
79
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 26 Related Party Transactions (continued)
Compensation
The aggregate compensation made to Directors and other members of Key Management Personnel of the
Group is set out below:
Short-term benefits
Other benefits
Long-term benefits
Post-employment benefits
Equity settled benefits
Total
30 Jun 2019
$
30 Jun 2018
$
4,139,733
1,008,250
20,380
59,246
500,000
5,727,609
4,414,431
600,000
84,580
75,868
-
5,174,879
Payments for other expenses and Trade Payables to related parties
The Group utilises Nicholson Ryan Lawyers for legal and advisory services. Mr Leath Nicholson is associated
with this firm. The Group has incurred expenses and made payments for services rendered by Nicholson
Ryan Lawyers totalling $940,528 (2018: $1,438,770).
The Group uses PSC Insurance Brokers (Aust) Pty Ltd as its General Insurance Broker. Mr Brian Austin is
associated with this firm. The Group has incurred expenses for services rendered by PSC Insurance Brokers
(Aust) Pty Ltd totalling $103,000 (2018: $35,000). Of the $103,000 disclosed, $68,000 remains payable at the
end of the reporting period.
The Group has incurred expenses and made payments during the year to the following related entities of
Mr Raymond Malone.
Silvan Bond Pty Ltd – Property rental fees
Malone Superannuation Fund – Property rental fees
30 Jun 2019
$'000
30 Jun 2018
$'000
178
59
237
171
57
288
Of the $59,000 disclosed above, $45,000 remains payable at the end of the reporting period.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
80
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 26 Related Party Transactions (continued)
Payments for other expenses and Trade Payables to related parties (continued)
The Group has incurred expenses and made payments during the year to the following related entities of
Mr Andrew Hopkins.
AV Ventures Pty Ltd – Property rental fees and outgoings
A&R Property Developments Pty Ltd – Property rental fees and outgoings
A&R Development Holdings Pty Ltd – Property rental fees and outgoings
A&R Development Holdings Pty Ltd – Property rental fees and outgoings
A&R Development Holdings Pty Ltd – Property rental fees and outgoings
30 Jun 2019
$'000
30 Jun 2018
$'000
188
442
329
168
313
1,440
201
421
283
76
141
1,122
During the year, the Group transacted with Unity Claims Support, a claims management business which
handles and allocates insurance claims from a number of major insurers into accident repair facilities around
Australia. Unity Claims Support is the business name for A and R Insurance Management Pty Ltd, a related
entity of Mr Andrew Hopkins.
The Group has incurred expenses and made payments during the year to the following related entities of
Mr Andrew Hopkins.
A and R Insurance Management Pty Ltd – Allocations and assessing
A and R Insurance Management Pty Ltd – Loan cars and related charges
30 Jun 2019
$'000
30 Jun 2018
$'000
287
191
478
-
-
-
Of the $478,000 disclosed above, $3,000 remains payable at the end of the reporting period.
The Group has incurred expenses and made payments during the year to the following related entities of
Mr Raymond Smith-Roberts.
30 Jun 2019
$'000
30 Jun 2018
$'000
SRFE Pty Ltd – Property rental fees and outgoings
SRFE Pty Ltd – Property rental fees and outgoings
SRFE Pty Ltd – Recruitment and training services
Trade Receivables to related parties
There are no trade receivables from related parties at the end of the reporting period.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
299
19
22
340
266
6
6
272
81
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 26 Related Party Transactions (continued)
Loans to/from related parties
As part of the acquisition of Gemini Accident Repair Centres Pty Ltd in a prior year, the Group acquired loans
to certain vendors of that entity. These loans have not been repaid and it is proposed that they will be
extinguished against future short-term and long-term incentives. The loans accrue interest at a rate of 5.37%
per annum. As at 30 June 2019, there are loans to entities associated with Mr Andrew Hopkins totalling
$1,270,884 (2017: $1,270,884).
There are no other loans with related parties outstanding at the end of the reporting period.
Other payments to related parties
During the year, the Group paid out the deferred consideration in respect of the Gemini Accident Repair
Centres Pty Ltd acquisition. Mr Andrew Hopkins was one of the vendors and received $10,337,019.
Note 27 Contingent Liabilities
Unsecured guarantees, indemnities and undertakings have been given by the Company in the normal course
of business in respect of financial trade arrangements entered into by its subsidiaries and a Deed of Cross
Guarantee (Note 35) was entered into with its continuing subsidiaries during the financial year ended 30 June
2019. It is not practicable to ascertain or estimate the maximum amount for which the Company may become
liable in respect thereof. At 30 June 2019 no subsidiary was in default in respect of any arrangement
guaranteed by the Company and all amounts owed have been brought to account as liabilities in the financial
statements.
Bank guarantees
30 Jun 2019
$’000
30 Jun 2018
$’000
6,150
3,834
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
82
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 28 Commitments for Expenditure
Capital commitments - property, plant & equipment
Committed at the end of the reporting period but
not recognised as liabilities, payable:
Within one year
One to five years
After more than five years
Lease commitments - operating
Committed at the end of the reporting period but
not recognised as liabilities, payable:
Within one year
One to five years
After more than five years
Note
30 Jun 2019
$'000
30 Jun 2018
$'000
30
-
-
30
1,201
-
-
1,201
25,342
51,939
4,730
82,011
21,696
38,403
6,682
66,781
Property leases periods 1 to 5 years (shown as operating leases) are non-cancellable with rent payable
monthly in advance. Contingent rental provisions within lease agreements generally require minimum lease
payments be increased by CPI or a percentage factor. Certain agreements have option arrangements to
renew the lease for an additional term and an option to purchase the premises at the market price at time of
option exercise.
During the previous financial years, the Group acquired businesses that had non-cancellable leases for
property that were deemed by Management to be onerous contracts. In these instances a provision was
raised to reflect the least net cost of exiting from the contract; which is the lower of the cost of fulfilling it and
any compensation or penalties arising from failure to fulfil it. This provision will unwind over the remaining
period of the lease terms.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
83
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 29
Investments in Controlled Entities
Name of entity
A.C.N. 107 954 610 Pty Ltd (*) (a)
Service Body Manufacturing Australia Pty Ltd (b)
A.C.N. 124 414 455 Pty Ltd (*)
AMA Procurement Pty Ltd (c)
A.C.N. 624 896 000 Pty Ltd (d)
AECAA Pty Ltd (e)
Custom Alloy Pty Ltd (*)
ECB Pty Ltd
FluidDrive Holdings Pty Ltd
Mr Gloss Holdings Pty Ltd
Phil Munday’s Panel Works Pty Ltd
Repair Management Australia Pty Ltd
Repair Management Australia Bayswater Pty Ltd
Repair Management Australia Dandenong Pty Ltd
BMB Collision Repairs Pty Ltd
Shipstone Holdings Pty Ltd
Woods Auto Shops (Dandenong) Pty Ltd
AMA Group Solutions Pty Ltd (f)
Repair Management New Zealand Limited
Ripoll Pty Ltd (*)
Woods Auto Shops (Holdings) Pty Ltd
Rapid Accident Management Services Pty Ltd (*)
Woods Auto Shops (Cheltenham) Pty Ltd (*)
Micra Accident Repair Centre Pty Ltd
Direct One Accident Repair Centre Pty Ltd
Smash Repair Canberra Pty Ltd
Geelong Consolidated Repairs Pty Ltd
Accident Management Australia Pty Ltd
Gemini Accident Repair Centres NZ Limited (*)
Carmax New Zealand Limited (*)
Automotive Solutions Group Pty Ltd (g) (h)
Fleet Alliance Pty Ltd (g)
ACAD Limited (i)
Alloy Motor Accessories Australia Pty Ltd (j)
A.C.N.624 895 772 Pty Ltd (k)
Deering Autronics Australia Pty Ltd (l)
Roo Systems Australia Pty Ltd (m)
Uneek 4x4 Australia Pty Ltd (l)
Carmax Australia Pty Ltd
Mt Druitt Autobody Repairs Pty Ltd (n)
Accident Repair Management Pty Ltd (n)
Accident Repair Management No. 2 Pty Ltd (n)
Accident Repair Management No. 3 Pty Ltd (n)
Country of
incorporation
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Class of
shares
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
New Zealand
Ordinary
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
New Zealand
Ordinary
New Zealand
Ordinary
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Equity holding %
2018
2019
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
60
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
60
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
-
-
-
-
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
84
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 29
Investments in Controlled Entities (continued)
Note:
(*) Dormant
(a) Previously known as Alanco Australia Pty Ltd
(b) Previously known as ACN 122 879 814 Pty Ltd. Name changed 27 October 2017
(c) Previously known as ACN 624 628 986 Pty Ltd. Registered on 23 February 2018. Name changed 25 April 2019
(d) Registered on 9 March 2018
(e) Previously known as KT Cable Accessories Pty Ltd
(f) Previously known as Gemini Accident Repair Centres Pty Ltd
(g) Acquired 100% on 18 January 2018
(h) Changed to a Pty Ltd Company 13 April 2018
(i) Registered on 26 February 2018
(j) Registered on 1 March 2018
(k) Previously known as ASG 4x4 Australia Pty Ltd. Registered on 9 March 2018. Name changed 14 December 2018
(l) Registered on 9 March 2018
(m) Registered on 1 March 2018
(n) Acquired on 1 July 2018
Note 30 Business Combinations
During the financial year, the Group acquired the operating assets and shares of various businesses. These
acquisitions are expected to increase the Group’s market share, product offering and reduce costs through
economies of scale. Details of these acquisitions are as follows:
• Mt Druitt Autobody Repair Group of companies on 1 July 2018:
o Two sites at Mt Druitt, New South Wales;
o Penrith, New South Wales; and
o Wetherill Park, New South Wales;
• Simply Smashing Repairs Group of businesses on 12 October 2018;
o Two sites at North Sydney, New South Wales;
• Bellarine Smash Repairs in Bellarine, Victoria on 1 November 2018;
• Parins Panel Works in Leederville, Western Australia on 14 December 2018;
• Northern Smash Repairs in Western Junction, Tasmania on 8 February 2019;
• Correct Panel Group of businesses on 1 April 2019:
o North Melbourne, Victoria;
o Murrumbeena, Victoria;
o Melbourne, Victoria; and
o Toorak, Victoria;
• Re-Car Australia Group of businesses on 1 April 2019:
o Brisbane, Queensland;
o Clayton, Queensland; and
o Townsville, Queensland;
• Wales Truck and Bus Repairs Group of businesses on 1 May 2019:
o Two sites at Smithfield, New South Wales;
Inkerman Panels in St Kilda, Victoria on 1 May 2019;
•
• KSR Autobody in Kingswood, New South Wales on 21 June 2019; and
• Norm Flynn Smash Repairs in Busselton, Western Australia on 28 June 2019.
From the date of acquisition to 30 June 2019, these acquisitions generated revenue of $44.0 million and profit
after tax of $7.4 million. The Group expects that if the above businesses were acquired on 1 July 2018, the
acquisitions would have generated revenue of $140.0 million and profit after tax of $11.9 million.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
85
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 30 Business Combinations (continued)
Details of these acquisitions are as follows:
Mt Druitt
Group
$’000
Simply
Smashing
Group
$’000
Correct
Panel
Group
$’000
Re-Car
Group
Wales
Group
Other
Total
$’000
$’000
$’000
$’000
Cash and cash equivalents
Trade and other receivables
Inventories
Other current assets
Plant and equipment
Deferred tax assets
Other non-current assets
Trade payables and accruals
Provisions
Borrowings
Other current liabilities
270
1,930
-
171
1,267
122
221
(3,079)
(366)
(60)
(727)
-
2
-
-
672
74
-
-
(247)
-
-
Net tangible assets acquired
Goodwill
Contracts
(251)
6,301
4,866
501
9,379
-
-
-
-
279
950
174
-
-
(580)
-
-
823
9,060
-
-
-
194
568
750
314
-
-
(1,046)
-
-
-
-
-
214
1,200
344
-
-
(1,146)
-
-
780
2,578
-
612
28,970
-
-
120
2
141
1,552
289
-
-
(963)
-
-
1,141
7,827
-
270
2,052
196
1,373
6,391
1,317
221
(3,079)
(4,348)
(60)
(727)
3,606
64,115
4,866
Total consideration
10,916
9,880
9,883
3,358
29,582
8,968
72,587
Representing:
Cash paid or payable
Shares issued
Gross Deferred consideration
5,916
2,000
3,000
4,680
-
5,200
4,883
-
5,000
1,858
-
1,500
14,582
-
15,000
5,613
-
3,355
37,532
2,000
33,055
10,916
9,880
9,883
3,358
29,582
8,968
72,587
Acquisition costs
113
27
82
60
105
103
490
The accounting for the Mt Druitt Group has been finalised during the reporting period. In respect of the other
acquisitions, the Group is yet to finalise the valuation of certain assets (namely property, plant & equipment)
and liabilities (namely Contingent vendor consideration). As such, the accounting for these acquisitions are
incomplete and the value attributed to Contingent vendor consideration, Plant & equipment and Goodwill may
change in future periods.
The group finalised three acquisitions in the current year in respect of acquisitions completed in FY2018.
Changes to the acquisition accounting were:
• Net increase to Tangible Assets acquired of $1,023,144;
• Net decrease to Goodwill of $817,236; and
• An increase in Contingent consideration of $805,254.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
86
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 31 Discontinued Operations
Following the acquisition of Automotive Solutions Group Limited (“ASG”), AMA management undertook a
strategic review of ASG’s operations and decided to discontinue certain activities. On the 14 December 2018,
the Company disposed of the business assets of ACN: 624 895 772 Pty Ltd (formerly ASG 4x4 Australia Pty
Ltd). Financial information relating to all discontinued operations for the reporting period is set out below.
Operating result
Revenue
Expenses
Profit / (loss) before income tax
Income tax (expense) / benefit
Profit / (loss) after income tax of discontinued operations
Cash Flow
Net cash inflow / (outflow) from ordinary activities
Net cash inflow / (outflow) from investing activities
Net cash inflow / (outflow) from financing activities
Net cash inflow / (outflow)
30 June 2019
$’000
30 June 2018
$’000
1,893
(2,125)
(232)
70
(162)
471
150
(1,036)
(415)
708
(785)
(77)
28
(49)
(4,056)
767
3,701
412
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
87
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 32 Reconciliation of Cash Flows
(a) Operating Cash Flows
Profit after income tax
Non-controlling interest
Income tax expense
Fair value adjustments
Share of equity accounted investment's result
Depreciation and amortisation expense
Impairment expense
Gain on acquisition
Non cash remuneration
Deferred income amortisation
Onerous leases
Income tax paid
Other
(Increases)/decreases in accounts receivable
(Increases)/decreases in inventories
(Increases)/decreases in prepayments
(Increases)/decreases in other assets
Increases/(decreases) in accounts payable
Increases/(decreases) in current provisions
Increases/(decreases) in non-current provisions
Increases/(decreases) in other current liabilities
Increases/(decreases) in other non-current liabilities
Increases/(decreases) in deferred tax assets / liabilities
Net operating cash flows
(b) Financing cash flows
Balance at 1 July 2017
Cash inflows
Cash outflows
Non-cash additions during the year
Balance at 30 June 2018
Balance at 1 July 2018
Cash inflows
Cash outflows
Non-cash additions during the year
Balance at 30 June 2019
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
30 Jun 2019
$'000
30 Jun 2018
$'000
21,553
196
9,460
(117)
-
16,208
-
-
1,499
(9,419)
47
(7,794)
(741)
(1,250)
(10,881)
162
(4,797)
(3,705)
(20)
(474)
28,118
(18,705)
137
19,477
15,105
264
9,319
951
1,744
13,390
2,108
(2,108)
853
(7,453)
(570)
(9,423)
(724)
(6,003)
(5,253)
370
910
8,674
4,024
(1,704)
-
-
-
24,474
Lease
Liabilities
Long-term
Borrowings
$'000
$’000
Total Liabilities
from Financing
Activities
$’000
697
-
(413)
48
332
332
-
(252)
52
132
13,000
43,000
(3,500)
-
52,500
52,500
52,750
(24,682)
-
80,568
13,697
43,000
(3,913)
48
52,832
52,832
52,750
(24,934)
52
80,700
88
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 33 Earnings per Share
Profit after income tax attributable to members of AMA Group Ltd
- From continuing operations
- From discontinued operations
Weighted average number of ordinary shares used in calculating
basic earnings per share
Adjustments for calculation of diluted earnings per share
Continuing operations:
- Basic earnings per share
- Diluted earnings per share
Discontinued operations:
- Basic earnings per share
- Diluted earnings per share
Continuing and discontinued operations:
- Basic earnings per share
- Diluted earnings per share
30 Jun 2019
$'000
30 Jun 2018
$'000
21,715
(162)
21,553
15,108
(3)
15,105
Number
Number
542,431,383
-
542,431,383
524,637,728
18,875,000
543,512,728
30 Jun 2019
Cents
30 Jun 2018
Cents
4.00
4.00
(0.03)
(0.03)
3.97
3.97
2.88
2.78
-
-
2.88
2.78
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
89
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 34 Parent Information
The following information has been extracted from the books and records of the Company and has been
prepared in accordance with accounting standards.
30 Jun 2019
$'000
30 Jun 2018
$'000
9,867
189,868
3,080
169,254
26,571
182,527
11,866
141,015
7,341
28,239
200,263
153
(193,075)
187,206
3,048
(162,015)
7,341
28,239
(20,808)
(12,291)
(20,808)
(12,291)
Assets
Current assets
Total assets
Liabilities
Current liabilities
Total liabilities
Net assets/(liabilities)
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
Profit/(loss) for the year
Total comprehensive income /(loss)
Guarantees and contingent liabilities
Refer to Note 27 for details of guarantees and contingent liabilities.
Contractual commitments
Refer to Note 28 for details of contractual commitments.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
90
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 35 Deed of Cross Guarantee Disclosures
The consolidated financial statements of the Group incorporate the assets, liabilities and results of the
controlled entities detailed in Note 29 prepared in accordance with the accounting policy described in Note 1.
Pursuant to ASIC Corporations (Wholly-owned Companies) Instrument 2017/785, relief has been granted
from the Corporations Act 2001 requirements for the preparation, audit and lodgement of financial reports for
the controlled entities detailed below.
Name of entity
A.C.N. 107 954 610 Pty Ltd
Service Body Manufacturing Australia Pty Ltd
A.C.N. 124 414 455 Pty Ltd
AMA Procurement Pty Ltd
A.C.N. 624 896 000 Pty Ltd
AECAA Pty Ltd
Custom Alloy Pty Ltd
ECB Pty Ltd
FluidDrive Holdings Pty Ltd
Mr Gloss Holdings Pty Ltd
Phil Munday’s Panel Works Pty Ltd
Repair Management Australia Pty Ltd
Repair Management Australia Bayswater Pty Ltd
Repair Management Australia Dandenong Pty Ltd
BMB Collision Repairs Pty Ltd
Shipstone Holdings Pty Ltd
AMA Group Solutions Pty Ltd
Ripoll Pty Ltd
Woods Auto Shops (Holdings) Pty Ltd
Rapid Accident Management Services Pty Ltd
Woods Auto Shops (Cheltenham) Pty Ltd
Micra Accident Repair Centre Pty Ltd
Direct One Accident Repair Centre Pty Ltd
Smash Repair Canberra Pty Ltd
Geelong Consolidated Repairs Pty Ltd
Accident Management Australia Pty Ltd
Automotive Solutions Group Pty Ltd
Fleet Alliance Pty Ltd
ACAD Limited
Alloy Motor Accessories Australia Pty Ltd
A.C.N.624 895 772 Pty Ltd
Deering Autronics Australia Pty Ltd
Roo Systems Australia Pty Ltd
Uneek 4x4 Australia Pty Ltd
Carmax Australia Pty Ltd
Mt Druitt Autobody Repairs Pty Ltd
Accident Repair Management Pty Ltd
Accident Repair Management No. 2 Pty Ltd
Accident Repair Management No. 3 Pty Ltd
Country of
incorporation
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Equity holding %
2018
2019
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
-
100
-
100
-
100
-
100
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
91
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 35 Deed of Cross Guarantee Disclosures (continued)
As a condition of the Instrument, the above entities entered into a Deed of Cross Guarantee. The effect of the
deed is that AMA Group Limited has guaranteed to pay any deficiency in the event of winding up of a
controlled entity detailed above or if they do not meet their obligations under the terms of overdrafts, loans,
leases or other liabilities subject to guarantee. The controlled entities detailed above have also given a similar
guarantee in the event that AMA Group Limited is wound up or if it does not meet its obligations under the
terms of overdrafts, loans, leases, or other liabilities subject to the guarantee.
The Trustee to this deed of cross guarantee is Ripoll Pty Ltd; which is a member of the consolidated group.
The Alternate Trustee to this deed of cross guarantee is Woods Auto Shops (Cheltenham) Pty Ltd; which is
also a member of the consolidated group. The continuing entities and only the continuing entities are included
in the deed of cross guarantee.
If the Deed of Cross Guarantee and the subsequent closed group disclosures were contained in the accounts
of AMA Group Limited, then an assessment would need to be made as to the fair value of the Deed of Cross
Guarantee (as a financial guarantee to the Company) and the details of the valuation and significant
assumptions, estimate and judgements used within that valuation would need to be disclosed. Please refer to
the disclosure surrounding financial guarantees in the financial statements of AMA Group Limited (see Note
27 for further information on financial guarantees).
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
92
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 35 Deed of Cross Guarantee Disclosures (continued)
The Statement of Comprehensive Income of the entities that are members of the Closed Group is below:
Income Statement for the year ended
30 Jun 2019
$’000
30 Jun 2018
$’000
Revenue from continuing operations
Raw materials and consumables used
Employment benefits expense
Occupancy expense
Travel and motor vehicle expense
Professional services expense
Advertising and marketing expense
Insurance expense
Research and development expense
Information technology expense
Communication expense
Other expense
Earnings before interest, tax, depreciation and
amortisation (EBITDA)
Depreciation and amortisation expense
Impairment expense
Earnings before interest and tax (EBIT)
Finance costs
Share of Net Profit from Associates using the Equity Method
Profit from continuing operations before fair value adjustments
Fair value adjustments
Profit (loss) before income tax from continuing operations
Profit (loss) before tax from discontinued operations
Profit (loss) before income tax
Income tax benefit / (expense)
Net profit (loss)
607,914
(258,016)
(235,414)
(43,477)
(4,172)
(5,530)
(2,809)
(1,157)
(288)
(2,077)
(1,397)
(4,679)
48,898
(15,982)
-
32,916
(2,595)
-
30,321
117
30,438
-
30,438
(9,231)
21,207
500,721
(216,826)
(187,953)
(33,388)
(3,677)
(6,727)
(1,926)
(691)
(295)
(1,794)
(1,132)
(3,418)
42,894
(13,256)
(2,108)
27,530
(786)
(1,744)
25,000
(951)
24,049
(5)
24,044
(8,932)
15,112
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
93
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 35 Deed of Cross Guarantee Disclosures (continued)
The Consolidated Statement of Financial Position of the entities that are members of the Closed Group is as
shown below:
Statement of Financial Position as at
30 Jun 2019
$'000
30 Jun 2018
$'000
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Income tax receivable
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Deferred tax asset
Investment in controlled entities
Receivables from related entities
Financial assets at amortised cost
Other non-current assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Income tax payable
Provisions
Other current liabilities
Total current liabilities
Non-current liabilities
Financial liabilities at amortised cost
Provisions
Other non-current liabilities
Deferred tax liability
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Accumulated losses
Total equity
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
11,236
47,177
40,798
-
9,270
108,481
61,764
262,290
13,190
750
994
2,044
7,253
348,285
456,766
64,443
4,466
22,970
37,099
128,978
80,568
10,224
42,288
2,634
135,714
264,692
192,074
200,263
153
(8,342)
192,074
15,853
43,656
29,187
129
3,459
92,284
54,631
198,998
9,205
750
916
2,162
2,280
268,942
361,226
66,083
-
18,914
12,789
97,786
52,500
6,943
30,115
3,225
92,783
190,569
170,657
187,206
3,048
(19,597)
170,657
94
AMA GROUP LIMITED
(ACN 113 883 560)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2019
Note 36 Events Occurring after the Reporting Period
On 3 July 2019, AMA acquired the remaining 40% shares in Woods Auto Shops (Dandenong) Pty Ltd.
On 8 August 2019, a fully refundable deposit of $4 million was received for an acquisition that did not proceed.
On 26 August 2019, the Directors declared a dividend, fully franked of 2.25 cents per security which is to be
paid 13 November 2019.
No other matters or circumstances have arisen since 30 June 2019 that have significantly affected, or may
significantly affect the Group's operations in future financial years, the results of those operations in future
financial years, or the Group's state of affairs in future financial years.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
95
AMA GROUP LIMITED
(ACN 113 883 560)
DIRECTORS’ DECLARATION
FOR THE YEAR ENDED 30 JUNE 2019
DIRECTORS’ DECLARATION
In the Directors' opinion:
a. the attached financial statements and notes thereto are in accordance with the Corporations Act 2001,
including:
i.
ii.
complying with Australian Accounting Standards, the Corporations Regulations 2001 and other
mandatory professional reporting requirements; and
giving a true and fair view of the Group's financial position as at 30 June 2019 and of its performance
for the financial year ended on that date; and
b. there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable; and
c. at the date of this declaration, there are reasonable grounds to believe that the members of the closed
group identified in Note 35 will be able to meet any obligations or liabilities to which they are, or may
become, subject by virtue of the deed of cross guarantee described in Note 35.
Note 1 confirms that the financial statements also comply with the International Financial Reporting Standards
as issued by the International Accounting Standards Board.
The Directors have been given the declarations by the Chief Executive Officer and the Chief Financial Officer
required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of the Directors made pursuant to section 303(5) of the Corporations
Act 2001.
On behalf of the Directors
Andrew Hopkins
Director
26 August 2019
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
96
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF AMA GROUP LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of AMA Group Limited (the Company) and its subsidiaries (the Group), which
comprises the consolidated statement of financial position as at 30 June 2019, the consolidated statement of
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 30 June 2019 and of its financial performance
for the year then ended; 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report of the current period. These matters were addressed in the context of our audit of the financial
report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Impairment of Goodwill
Area of Focus
Refer also to Note 1 (Accounting Policy), Note 12
Intangible Assets (Financial Disclosures)
In the prior years the group expanded its activities
through acquisition of businesses. As a result the
group’s net assets include a significant amount of
goodwill.
How our audit addressed the area of focus
Our procedures included:
A detailed analysis of the key changes to the group
to determine the appropriateness of the five
segments and CGUs.
A detailed evaluation of the group’s budgeting
procedures upon which the forecasts are based
and testing the principles and integrity of the
discounted future cash flow models.
97
ShineWing Australia ABN 39 533 589 331. Liability limited by a scheme approved under Professional Standards Legislation. ShineWing Australia is an independent member of ShineWing
International Limited – members in principal cities throughout the world.
Impairment of Goodwill
Certain of the new and established businesses are (i)
early in their life and/or trading cycles (ii) trading cycle’s
inconsistent (iii) value of businesses questionable, and,
as such, there is a risk that they may not trade in line
with initial expectations and forecasts, resulting in the
carrying amount of goodwill exceeding the recoverable
amount and therefore requiring impairment.
The Directors have determined in the current year that
they have five CGUs and these operate in five
segments.
The recoverable amount of the cash generating units
(CGU) have been calculated based on value-in-use
models. These recoverable amounts use discounted
cash flow forecasts in which Directors make judgements
about certain key inputs. For example, but not limited to
revenue, growth rates and inflation rates are estimated.
Overall, due to the high level of judgement involved, and
the significant carrying amounts involved, we have
determined that the recoverable amount is a key
judgemental area that our audit concentrated on.
Contingent Vendor Consideration
Area of focus
Refer also to Note 1 (Accounting Policy), Note 18 Other
Liabilities and Note 24 Financial Instruments (Financial
Disclosures)
The Group has continued to acquire new businesses
during the current financial period.
Most of the major business purchase agreements
contain earn out clauses for the payment of further
consideration should certain targets be met.
Determining the future payout liability is complex given
earn out considerations relate to purchases of
businesses over a number of financial periods. The
directors estimate of the likely quantum of consideration
which will ultimately be paid includes an assessment of:
The relevant performance metrics of the relevant
business; and
Future expected performance in the ern out periods.
Overall, due to high level of judgement involved, and the
significant carrying amounts involved, we have
determined that the recoverable amount is a key
judgmental area that our audit concentrated on.
Testing the accuracy of the calculation derived
from each forecast model and assessing key
inputs to the calculations such as revenue growth,
discount rates and working capital assumptions.
This is carried out with reference to the Board
approved forecasts, data external to the group and
using our own assessments.
Engaging our own valuation specialists when
considering the appropriateness of the discount
rates and long term growth rates.
Reviewing historical accuracy of original forecasts
made by comparing them with actual results.
We also considered the adequacy of the Group
disclosures in relation to the impairment testing.
How our audit addressed the area of focus
Our procedures included:
Review of the purchase agreements;
Referring to conditions precedent from previous
financial period agreements that have earn outs in
the current financial period and beyond;
Assessing the estimates by the directors at year
end to identify whether they appeared reasonable
based on actual performance to date, of the
businesses acquired;
Challenging the assumptions used and the basis
on which the forecasts have been prepared by the
directors; and
Testing the net present value calculation.
We also considered the adequacy of the Group’s
disclosures in relation to the contingent vendor
considerations.
98
Business Combinations
Area of focus
How our audit addressed the area of focus
Refer also to Note 1 (Accounting Policy), Note 30
Business Combinations (Financial Disclosures)
The Group acquired several businesses which were
considered significant purchases for the Group in the
current period.
Accounting for these transactions is complex and
required significant judgements and estimates by the
directors:
To determine the date of acquisition;
To determine the fair value of assets and liabilities
acquired;
To determine the fair value of deferred vendor
consideration; and
To allocate the purchase consideration to goodwill.
Our procedures included:
Reviewing the sales agreements to understand the
key terms and conditions of the acquisitions;
Assessing the goodwill recognised as a result of the
business combinations (Refer separate KAM above);
Reviewing the unaudited completion accounts used as
the directors determination of fair values of assets and
liabilities purchased at acquisition date; and
Testing the appropriateness of the deferred
consideration (Refer separate KAM above).
We assessed the adequacy of the Group’s disclosures
in respect of the business combinations.
Information Other than the Financial Report and Auditor’s Report Thereon
The directors are responsible for the other information. The other information comprises the information included in
the Group’s annual report for the year ended 30 June 2019, but does not include the financial report and our
auditor’s report thereon.
Our opinion on the financial report does not cover the other information and 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.
99
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 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.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and
maintain professional scepticism throughout the audit. We also:
identify and assess the risks of material misstatement of the financial report, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Group’s internal control.
evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the directors.
conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the
audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or,
if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
evaluate the overall presentation, structure and content of the financial report, including the disclosures, and
whether the financial report represents the underlying transactions and events in a manner that achieves fair
presentation.
obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial report. We are responsible for the direction,
supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
communicate with the directors regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them, all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance in
the audit of the financial report of the current period and are therefore the key audit matters. We describe these
matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.
100
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 13 to 21 of the directors’ report for the year ended 30
June 2019.
In our opinion, the Remuneration Report of AMA Group Limited for the year ended 30 June 2019, complies with
section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in
accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
ShineWing Australia
Chartered Accountants
Nick Michael
Partner
Melbourne, 26 August 2019
101
AMA GROUP LIMITED
(ACN 113 883 560)
CORPORATE GOVERNANCE STATEMENT
CORPORATE GOVERNANCE STATEMENT
The Board of Directors (Board) of AMA Group Limited (Company) is responsible for the corporate governance
of the group. The Board guides and monitors the business and affairs of the Company on behalf of the
shareholders by whom they are elected and to whom they are accountable.
Commensurate with the spirit of the ASX Corporate Governance Principles and Recommendations (3rd
Edition) (principles or recommendations), the Company has followed each recommendation where the Board
has considered the recommendation to be an appropriate benchmark for the corporate governance practices,
taking into account factors such as the size of the Company and the Board, resources available and activities
of the Company. Where the Company’s corporate governance practices depart from the recommendations,
the board has offered full disclosure of the nature and reason for the departure.
All Charters and Policies are available from the Company or on its website at www.amagroupltd.com.
Principle 1: Lay solid foundations for management and oversight.
Role of the Board and Executive Management
The Board's role is to govern the Company rather than to manage it. In governing the Company, the Directors
must act in the best interests of the Company as a whole. It is the role of executive management to manage
the Company in accordance with the direction and delegations of the Board and the responsibility of the Board
to oversee the activities of executive management in carrying out these delegated duties. The Board's
responsibilities are detailed in its Board Charter.
Board Appointments
The Company undertakes comprehensive reference checks prior to appointing a director or putting that
person forward as a candidate to ensure that person is competent, experienced, and would not be impaired in
any way from undertaking the duties of director. The Company provides relevant information to shareholders
for their consideration about the attributes of candidates together with whether the Board supports the
appointment or re-election.
The terms of the appointment of a non-executive director, executive directors and senior executives are
agreed upon and set out in writing at the time of appointment.
The Company Secretary
The Company Secretary is accountable directly to the Board, through the chairman, on all matters to do with
the proper functioning of the Board, including agendas, Board papers and minutes, advising the Board and its
committees (as applicable) on governance matters, monitoring that the Board and committee policies and
procedures are followed, communication with regulatory bodies and the ASX and statutory and other filings.
Diversity
The Company is committed to increasing diversity amongst its employees, not just gender diversity. Our
workforce is employed based on the right person for the right job regardless of their gender, age, nationality,
race, religious beliefs, cultural background, sexuality or physical ability.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
102
AMA GROUP LIMITED
(ACN 113 883 560)
CORPORATE GOVERNANCE STATEMENT
Executive and board positions are filled by the best candidates available without discrimination. The
Company is committed to increasing gender diversity within these positions when appropriate appointments
become available. It is also committed to identifying suitable persons within the organisation and where
appropriate opportunities exist, advance diversity and to support promotion of talented employees into
management positions.
The Company has not set any gender specific diversity objectives as it believes that all categories of diversity
are equally as important within its organisation.
The following table demonstrates the Company’s gender diversity amongst employees and contractors as at
30 June 2019.
Board
Executive Team
Employees
Women (Qty.) 2018
Women (Qty.) 2019
0
0
1
2
308
370
Encourage Enhanced Performance
The performance of the Board, individual directors and executive officers of the Company is monitored and
evaluated by the Board. The Board is responsible for conducting evaluations on a regular basis in line with
these policy guidelines.
An evaluation of the performance of the board was conducted during the year. The evaluation has provided
the board with valuable feedback for future development.
During the year, all directors have full access to all Company records and receive financial and operational
reports at each Board meeting.
Independent Advice
Directors collectively or individually have the right to seek independent professional advice at the Company's
expense, up to specified limits, to assist them to carry out their responsibilities. All advice obtained is made
available to the full Board.
Principle 2: Structure the Board to add value.
Structure and Composition of the Board
The Board has been formed so that it has an effective mix of personnel who are committed to discharging
their responsibilities and duties and being of value to the Company.
The names of the directors, their independence, qualifications and experience are stated on in the directors’
report along with the term of office held by each.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
103
AMA GROUP LIMITED
(ACN 113 883 560)
CORPORATE GOVERNANCE STATEMENT
The Board believes that the interests of all shareholders are best served by:
• Directors having the appropriate skills and experience;
• A number of the directors being independent as defined in the ASX Corporate Governance Guidelines;
and
• Some major shareholders being represented on the Board.
Where any director has a material personal interest in a matter, the director will not be permitted to be present
during discussion or to vote on the matter. The enforcement of this requirement is in accordance with the
Corporations Act 2001 and aims to ensure that the interests of shareholders, as a whole, are pursued and that
their interest or the director's independence is not jeopardised.
At 30 June 2019 the Board consisted of seven directors - four of the directors being non-executive: Leath
Nicholson, Brian Austin, Simon Moore and Anthony Day. Taking in consideration the ASX’s Principles, the
board has determined that all of the non-executive directors are considered independent. The Company
makes the following comments:
Mr Nicholson: The Company currently has a commercial relationship with a law firm for which Mr Nicholson is
a partner. The legal fees paid to this company for legal due diligence associated with some recent panel
division acquisitions are on an arms-length commercial basis and not considered material from a financial
perspective in light of the Company’s overall expenditure for the period (refer Note 26). The Company
believes that Mr Nicholson’s participation in the legal services provided by his firm are not material and he
exercises independent judgement in his position with the board. Mr Nicholson was not present or able to vote
when the Board discussed or voted on the contracts/fees paid to the associated company. Taking into
consideration the above, the Company considers Mr Nicholson to be independent.
Mr Austin: The Company currently has a commercial relationship with an insurance broking company for
which Mr Austin is the Chairman. The fees paid to this company for brokerage services are on an arms-
length commercial basis and not considered material from a financial perspective in light of the Company’s
overall expenditure for the period (refer Note 26). Mr Austin has no involvement in the provision of the
insurance brokerage services provided by his associated company. The Company believes that Mr Austin
exercises independent judgement in his position with the board. Mr Austin was not present or able to vote
when the Board discussed or voted on the contracts/fees paid to the associated company. Taking the above
into consideration, the Company considers Mr Austin to be independent.
Mr Moore: The Company currently has a relationship with a corporate advisory services firm in which Mr
Moore is a senior partner. The firm have provided due diligence services for potential material acquisitions for
the Company. To date, no fees have been paid to this firm. Any fees payable to this company in the future for
advisory services will be on an arm’s length commercial basis. Mr Moore’s participation in the provision of the
advisory services is not a significant proportion of his time. The Company believes that Mr Moore exercises
independent judgement in his position with the board. Mr Moore has a relevant interest in 20 million ordinary
shares in the Company. Taking the above into consideration, the Company considers Mr Moore to be
independent.
Mr Day: Until October 2017, Mr Day was the CEO of Suncorp Insurance. The Company currently has a
material contractual relationship with Suncorp Insurance. The Company believes that Mr Day exercises
independent judgement in his position with the board and his prior relationship with a material customer is a
benefit to the Company. Mr Day is not able to vote when the Board discusses or votes on any contractual
relationship with the insurer. Taking the above into consideration, the Company considers Mr Day to be
independent.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
104
AMA GROUP LIMITED
(ACN 113 883 560)
CORPORATE GOVERNANCE STATEMENT
The Board is currently chaired by executive director Raymond Malone. Mr Malone stepped down from the
position as Group CEO in November 2018. The Board has delegated certain responsibilities from the
Chairman to non-executive directors, including Deputy Chair Simon Moore (non-executive director) to
minimise any conflict that may arise from the Chairman holding an executive position.
The Company currently has no Nomination Committee as it believes that due to the size of the Board and the
Company and the nature of the Company’s current activities, this function is best served by the full Board.
The Board is responsible for considering board succession issues and reviewing Board composition to assist
in ensuring the Board has the appropriate balance of skills, knowledge, experience and independence to
enable it to discharge its duties and responsibilities effectively.
Members of the board have a broad range of industry, financial and other skills, knowledge and experience to
effectively guide the business. Directors with a range of qualifications, expertise and experience are
appointed to enable the Board to effectively discharge its duties and to add value to its deliberations. The
following skills matrix identified the skills, knowledge, experience and capabilities of the Board that enable it to
meet the current and future challenges of the Group.
Industry Knowledge
•
• Acquisition & Divestment
• Public Company & Investor Relations
• Financial Acumen & Risk Management
• Legal & Compliance
• Strategic Planning
• People Management
Induction of New Directors and Ongoing Development
Any new directors will be issued with a formal Letter of Appointment that sets out the key terms and conditions
of their appointment, including director's duties, rights and responsibilities, the time commitment envisaged,
and the Board's expectations regarding involvement with any committee work.
A new director induction program is in place and directors are encouraged to engage in professional
development activities to develop and maintain the skills and knowledge needed to perform their role as
directors effectively.
Principle 3: Act ethically and responsibly
Ethical and Responsible Decision-Making
As part of its commitment to recognising the legitimate interests of stakeholders, the Company has adopted a
Code of Conduct to guide compliance with legal and other obligations to legitimate stakeholders.
The Company has a share trading policy that regulates the dealings by directors, officers and employees, in
shares, options and other securities issued by the Company. The policy has been formulated to ensure that
directors, officers, employees and consultants who work on a regular basis for the Company are aware of the
legal restrictions on trading in Company securities while in possession of unpublished price-sensitive
information.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
105
AMA GROUP LIMITED
(ACN 113 883 560)
CORPORATE GOVERNANCE STATEMENT
As a good corporate citizen, the Company encourages compliance with and commitment to appropriate
corporate practices that are fair and ethical, via its Code of Conduct.
Principle 4: Safeguard integrity in corporate reporting.
Audit Committee
The Company currently has a duly constituted Audit Committee currently consisting of three non-executive
Directors. All directors are considered independent in accordance with the ASX Principles. The current
members of the committee, as at the date of this report, and their qualifications are detailed in the directors'
profiles in the Directors’ Report.
The committee holds a minimum of two meetings a year. Attendance to these meetings by the members of
the Audit Committee is detailed in the Directors’ Report.
The Company's external auditor attends each annual general meeting and is available to answer any
questions with regard to the conduct of the audit and their report.
Chief Executive Officer and Chief Financial Officer Declarations
The Chief Executive Officer and Chief Financial Officer have provided the Board with a declaration that, in
their opinion, the financial records of the entity have been properly maintained and that the financial
statements comply with the appropriate accounting standards and give a true and fair view of the financial
position and performance of the entity and that the opinion has been formed on the basis of a sound system
of risk management and internal control which is operating effectively.
Principle 5: Making timely and balanced disclosure.
The Company has procedures in place to ensure that the Company’s Continuous Disclosure obligations under
ASX Listing Rules and Corporations Act are met and that the market is properly informed of matters which
may have a material impact on the price at which securities are traded.
The Board has designated the Company Secretary as the person responsible for overseeing and coordinating
disclosure of information to the ASX as well as communicating with the ASX. In accordance with ASX Listing
Rules, the Company immediately notifies the ASX of information concerning the Company:
1. That a reasonable person would or may expect to have a material effect on the price or value of the
Company's securities; and
2. That would, or would be likely to, influence persons who commonly invest in securities in deciding
whether to acquire or dispose of the Company's securities.
Principle 6: Respect the rights of shareholders.
The Company is committed to providing current and relevant information to its shareholders.
The Company respects the rights of its shareholders, and to facilitate the effective exercise of the rights, the
Company is committed to:
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
106
AMA GROUP LIMITED
(ACN 113 883 560)
CORPORATE GOVERNANCE STATEMENT
1. Communicating effectively with shareholders through ongoing releases to the market via ASX information
and general meetings of the Company;
2. Giving shareholders ready access to balanced and understandable information about the Company and
corporate proposals;
3. Making it easy for shareholders to participate in general meetings of the Company; and
4. Requesting the external Auditor to attend the Annual General Meeting and be available to answer
shareholder's questions about the conduct of the audit, and the preparation and content of the Auditor's
Report.
Any shareholder wishing to make inquiries of the Company is advised to contact the registered office. All
public announcements made by the Company can be obtained from the ASX's website www.asx.com.au.
Shareholders may elect to, and are encouraged to, receive communications from the Company and its
securities registry electronically.
The Company maintains information in relation to its corporate governance documents, Directors and senior
executives, Board and committee charters and Annual Reports on the Company’s website.
Principle 7: Recognise and managing risk.
The Board is committed to the identification, assessment and management of risk throughout the Company’s
business activities.
The Audit Committee operates pursuant to a charter which provides for risk oversight and management within
the Company. This is periodically reviewed and updated. Executive management reports risks identified to
the committee on a periodic basis.
The Company’s Risk Management Policy recognises that risk management is an essential element of good
corporate governance and fundamental in achieving its strategic and operational objectives. Risk
management improves decision making, defines opportunities and mitigates material events that may impact
security holder value.
The Board reviews the entity’s risk management framework regularly to satisfy itself that it continues to be
sound. A review of the Company’s risk management framework was conducted during the year.
Executive management reports risks identified to the Board through regular operations reports, and via direct
and timely communication to the Board where and when applicable. During the reporting period, executive
management has reported to the Board as to the effectiveness of the Company’s management of its material
business risks. The Company does not have an internal audit function.
The Company faces risks inherent to its business, including economic risks, which may materially impact the
Company’s ability to create or preserve value for security holders over the short, medium or long term. The
Company has in place policies and procedures, including a risk management framework (as described in the
Company’s Risk Management Policy), which is developed and updated to help manage these risks. The
Board does not consider that the Company currently has any material exposure to environmental or social
sustainability risks.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
107
AMA GROUP LIMITED
(ACN 113 883 560)
CORPORATE GOVERNANCE STATEMENT
The Chief Executive Officer and the Chief Financial Officer have given a statement to the Board that the
integrity of the financial statements is founded on a sound system of risk management and internal
compliance and controls based on the Company's Risk Management policies.
Principle 8: Remunerate fairly and responsibly
The Remuneration Committee currently consists of four non-executive directors. All of the directors are
considered independent in accordance with the ASX Principles.
Profiles of the members and details of meetings of the Remuneration Committee are outlined in the Director's
Report. The Committee’s responsibilities are detailed in the Remuneration Committee Charter.
The Company is committed to remunerating its senior executives in a manner that is market-competitive and
consistent with “Best Practice” as well as supporting the interests of shareholders. Senior executives may
receive a remuneration package based on fixed and variable components, determined by their position and
experience. Shares and/or options may also be granted based on an individual's performance, with those
granted to Directors subject to shareholder approval.
Non-executive Directors are paid their fees out of the maximum aggregate amount approved by shareholders
for the remuneration of non-executive Directors. Non-executive Directors do not receive performance-based
bonuses and do not participate in equity schemes of the Company without prior shareholder approval.
Current remuneration is disclosed in the Remuneration Report and in Note 26: Related Party Transactions.
Key Management Personnel or closely related parties of Key Management Personnel are prohibited from
entering into hedge arrangements that would have the effect of limiting the risk exposure relating to their
remuneration.
In accordance with the Company’s share trading policy, participants in any equity-based incentive scheme are
prohibited from entering into any transaction that would have the effect of hedging or otherwise transferring
the risk of any fluctuation in the value of any unvested entitlement in the Company’s securities to any other
person.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
108
AMA GROUP LIMITED
(ACN 113 883 560)
SHAREHOLDER INFORMATION
SHAREHOLDER INFORMATION
In accordance with the ASX Listing Rules the following information, as at 21 August 2019, is provided:
Substantial holders
The Company hold current substantial holder notifications in accordance with section 671B of the
Corporations Act 2001 for the following:
Cedarfield Holdings Pty Ltd ATF The Cedarfield Trust
Greencape Capital Pty Ltd
AustralianSuper Pty Ltd
Number of holders of equity securities
33,561,242
26,812,575
61,914,812
6.22%
4.97%
11.49%
539,166,324 Fully Paid Ordinary Quoted shares are held by 1,974 individual holders.
8,355,901 Fully Paid Ordinary Unquoted shares are held by 3 individual holders; with all holders having in
excess of 100,000 units.
2,000,000 unquoted options over Fully Paid Ordinary Quoted shares exercisable at $1.20 each before 25 April
2021 held by 1 holder; with the holder having in excess of 100,000 units.
Voting rights
The voting rights attached to Fully Paid Ordinary shares are set out below:
Fully Paid Ordinary Quoted shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon
a poll each share shall have one vote.
Fully Paid Ordinary Unquoted shares
No voting rights
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
109
AMA GROUP LIMITED
(ACN 113 883 560)
SHAREHOLDER INFORMATION
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
Holders
Ordinary
Shares
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Total
Holding less than a marketable parcel
Equity security holders
Twenty largest quoted equity security holders
336
507
331
640
160
150,059
1,526,922
2,622,257
21,989,975
512,877,111
1,974
539,166,324
129
2,509
The names of the twenty largest security holders of quoted equity securities are listed below:
Shareholder:
Number Held
% of Total
Shares Held
HSBC Custody Nominees (Australia) Limited
J P Morgan Nominees Australia Pty Limited
National Nominees Limited
Mr Gloss Pty Limited
Cedarfield Holdings Pty Ltd
Citicorp Nominees Pty Limited
UBS Nominees Pty Ltd
Sargon Ct Pty Ltd
Sandman 1 Nominees Pty Ltd
Missy Nominees Pty Ltd
Sherley Investments Pty Ltd
Mr Richard John Calver
Yerrus Holdings Pty Ltd
Sandhurst Trustees Ltd
Aust Executor Trustees Ltd
SRFE Pty Ltd
BNP Paribas Nominees Pty Ltd
Mr Lachlan Alexander Mcgillivray
Magnacon Pty Ltd
Citicorp Nominees Pty Limited
117,498,290
113,504,452
45,197,169
36,315,349
33,561,242
24,910,615
20,765,181
12,000,000
8,000,001
5,035,830
4,420,834
4,342,500
4,000,000
3,617,381
3,191,220
3,000,000
2,930,529
2,916,624
2,866,667
2,388,160
21.79
21.05
8.38
6.74
6.22
4.62
3.85
2.23
1.48
0.93
0.82
0.81
0.74
0.67
0.59
0.56
0.54
0.54
0.53
0.44
450,462,044
83.55
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
110
AMA GROUP LIMITED
(ACN 113 883 560)
SHAREHOLDER INFORMATION
Unquoted equity shareholders
The names of security holders who hold 20% or more of the unquoted equity share class are as follows:
Autoco Pty Ltd
Stipe Popovic & Biserka Popovic
5,100,428
2,079,002
61.0%
24.9%
Securities subject to escrow
Class of Security
Fully Paid Ordinary Quoted
Fully Paid Ordinary Quoted
Fully Paid Ordinary Quoted
Fully Paid Ordinary Quoted
Fully Paid Ordinary Quoted
Fully Paid Ordinary Quoted
Fully Paid Ordinary Quoted
Fully Paid Ordinary Unquoted
Fully Paid Ordinary Unquoted
Fully Paid Ordinary Unquoted
* Subject to non-date escrow terms.
Shareholder enquiries
Number
Date Escrow
period ends
21,247,037
26,000,000
242,718
163,836
31,562,386
545,137
413,950
1,176,471
5,100,428
2,079,002
27 Nov 2019
*
31 Dec 2019
3 Jan 2020
27 Nov 2020
30 Jun 2021
20 Jul 2021
18 Mar 2019
30 Sep 2020
30 Sep 2021
Shareholders with enquiries about their shareholdings should contact the share registry:
Computershare Investor Services Pty Ltd
Yarra Falls, 452 Johnston Street,
Abbotsford, Victoria 3067
Phone: +61 3 9415 4000
Fax: +61 3 9473 2500
Email: essential.registry@computershare.com.au
Change of address, change of name, consolidation of shareholdings
Shareholders should contact the Share Registry to obtain details of the procedure required for any of these
changes.
Annual report
Shareholders do not automatically receive a hard copy of the Company’s Annual Report unless they notify the
Share Registry in writing. An electronic copy of the Annual Report can be viewed on the Company’s website
www.amagroupltd.com
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
111
AMA GROUP LIMITED
(ACN 113 883 560)
SHAREHOLDER INFORMATION
Tax file numbers
It is important that Australian resident shareholders, including children and corporate entities, have their tax
file number, ABN or exemption details noted by the Share Registry.
CHESS (Clearing House Electronic Sub-register System)
Shareholders wishing to move to uncertified holdings under the Australian Stock Exchange CHESS system
should contact their stockbroker.
Uncertified share register
Shareholding statements are issued at the end of each month that there is a transaction that alters the
balance of an individual/company’s holding.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
112
AMA GROUP LIMITED
(ACN 113 883 560)
CORPORATE DIRECTORY
CORPORATE DIRECTORY
Directors
Mr Raymond Malone (Chairman and Executive Director)
Mr Andrew Hopkins (Executive Director)
Mr Raymond Smith-Roberts (Executive Director)
Mr Leath Nicholson (Non-Executive Director)
Mr Brian Austin (Non-Executive Director)
Mr Simon Moore (Non-Executive Director) (Appointed 28 Nov 2018)
Mr Anthony Day (Non-Executive Director) (Appointed 28 Nov 2018)
Mr Hugh Robertson (Non-Executive Director) (Resigned 3 Aug 2018)
Executive Management
Mr Andrew Hopkins (Group Chief Executive Officer)
Mr Raymond Smith-Roberts (Chief Executive Officer - Automotive Components & Accessories Divisions)
Mr Steven Becker (Chief Financial Officer) (Appointed 4 Feb 2019)
Mr Ashley Killick (Chief Financial Officer) (Resigned 30 Oct 2018)
Mrs Terri Bakos (Company Secretary)
Registered Office
Level 4, 130 Bundall Road, BUNDALL, QUEENSLAND, 4217, AUSTRALIA
Email: info@amagroupltd.com
Telephone: +61 5628 3272
Principal Place of Business
Level 4, 130 Bundall Road, BUNDALL, QUEENSLAND, 4217, AUSTRALIA
Telephone: +61 5628 3272
Web: www.amagroupltd.com
Share Registry
Computershare Investor Services Pty Limited
Yarra Falls, 452 Johnston Street, ABBOTSFORD, VICTORIA, 3067, AUSTRALIA
GPO Box 2975, MELBOURNE VICTORIA 3001 AUSTRALIA
Telephone: +61 3 9415 4000
Telephone: 1300 787 272 (Within Australia)
Auditor
ShineWing Australia
Level 10, 530 Collins Street, MELBOURNE VICTORIA 3000 AUSTRALIA
Solicitors
Nicholson Ryan Lawyers
Level 7, 420 Collins Street, MELBOURNE VICTORIA 3000 AUSTRALIA
Bankers
National Australia Bank Limited
Stock Exchange Listing
AMA Group Limited shares are listed on the Australian Securities Exchange, code AMA.
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2019
113