ARIADNE AUSTRALIA LIMITED
2021 Annual Report
Corporate Information
202 1 A N N U A L R E P O R T
Directors
Mr David Baffsky, AO
(Independent Non-Executive Chairman)
Mr Kevin Seymour, AM
(Non-Executive Deputy Chairman)
Mr Christopher Barter
(Independent Non-Executive Director)
Mr John Murphy
(Independent Non-Executive Director)
Mr Benjamin Seymour
(Non-Executive Alternate Director to Mr Kevin Seymour, appointed 15 December 2020)
Dr Gary Weiss, AM
(Executive Director)
Company Secretary
Mr Natt McMahon
Registered Office and Principal Place of Business
Level 27, 2 Chifley Square, Chifley Tower
Sydney NSW 2000
Telephone: (02) 8227 5500
Facsimile: (02) 8227 5511
Share Register
Computershare Investor Services Pty Ltd
Level 3, 60 Carrington Street,
Sydney NSW 2000
Telephone: 1300 850 505 or +61 3 9415 4000
www.computershare.com.au
Bankers
ANZ Banking Group Limited
Auditors
Grant Thornton Audit Pty Ltd
Level 17, 383 Kent Street
Sydney NSW 2000
Website
www.ariadne.com.au
ABN
50 010 474 067
A R I A D N E A U S T R A L I A L I M I T E D
Contents
Chairman’s Letter
Executive Director’s Review
Directors’ Report
Auditor’s Independence Declaration
Financial Statements
Statement of Profit or Loss and Other Comprehensive Income
Balance Sheet
Statement of Changes in Equity
Statement of Cash Flows
Notes to Financial Statements
Directors’ Declaration
Independent Auditor’s Report
Shareholder Information
202 1 A N N U A L R E P O R T
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ABN 50 010 474 067
This report covers the consolidated entity comprising Ariadne Australia Limited (“Ariadne”) and its controlled entities (“the Group”).
The Group’s functional and presentation currency is Australian dollars (AUD).
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Chairman’s Letter
Dear Shareholders
The quality of our investments and the recovery of the market generally have produced a much improved result for shareholders.
A significant contributor to this year’s results was our investment in Orams Marine Village in New Zealand. What has been achieved at
Orams over the last 12 months in particular is a great case study of creating value, and your Board acknowledges the work and efforts of
all the team at Orams in undertaking the development on site on time and below budget, all while maintaining quality and performance
during this challenging period.
We continue to live and work in unprecedented and unpredictable times which require strong engagement between the whole Board and
the capacity to make rapid decisions to support our executive team. I thank each of your Directors for their time, input and wise counsel.
We believe that we are well positioned to generate further significant additional value over time.
Yours sincerely
Mr David Baffsky, AO
Chairman
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Executive Director’s Review
202 1 A N N U A L R E P O R T
The Directors present the Annual Report of Ariadne Australia Limited (“Ariadne” or “the Group”) for the period ended 30 June
2021.
For the 2021 financial year (“FY21”) Ariadne reported a net profit attributable to members of $10.6 million (2020: $7.1 million loss).
In addition, a positive contribution attributable to members of $26.1 million (2020: $21.2 million negative contribution) was reported
through the Statement of Comprehensive Income, resulting in a total comprehensive income attributable to members of $36.7 million
(2020: $28.3 million loss).
The net tangible assets per share increased during the period by 32% from 57.21 cents per share to 75.90 cents per share at balance
date.
The total comprehensive income per share was 18.69 cents compared to a loss of 14.42 cents for the previous corresponding period.
The net operating cash outflow during the period was $1.0 million (2020: $7.3 million inflow).
The results for FY21 represent a welcome return to profitability for Ariadne following two years of losses which were principally
attributable to mark-to-market write-downs on our investment portfolio. The recovery in the market values of some of our strategic
investments, coupled with the excellent performance of our investment in Orams Group Ltd (“Orams”), has underpinned the increase
in our net tangible assets during the period.
Orams
A significant contributor to the FY21 results was our investment in our associate, Orams, in which Ariadne holds an indirect equity
interest of 61%.
During the year, Orams continued the construction of the state-of-the-art marine refit facility on Site 18 in the Wynyard Quarter in
Auckland, pursuant to the development agreement with Panuku Development Auckland.
Notwithstanding the challenges arising from the COVID-19 pandemic, all of the requirements of Stage 1A under the Development
Agreement were completed during the period. It is testament to the extraordinary abilities of the Orams team that this was achieved
on time and under budget in such circumstances.
Orams has also recently completed construction of 3 additional 90 metre marina piers, adding 610 metres of new marina space to
the existing 400 metres of marina berths adjacent to the haulout yard. Construction of a new 580 square metre shed on Orams’
existing site has also commenced and is due for completion by the end of 2021.
Following the outbreak of the pandemic, New Zealand imposed strict border requirements, limiting substantially the number of
tourists and other visitors into the country. This resulted in a number of cancellations for refits and other maintenance work from
overseas superyachts, many of which had intended to travel to Auckland to view the America’s Cup and related series’ races in the
first few months of 2021.
Notwithstanding this setback, Orams’ operating business has performed well. Orams’ facilities now offer the most comprehensive
refit and boat maintenance infrastructure in the Southern Hemisphere. With three travel lifts (820, 85 and 75 tonnes), as well as the
existing 600 tonne slipway, Orams can haul out vessels from superyachts to domestic vessels, and a wide range of commercial boats
including the ferry fleet that operates in the Auckland region.
The de-risking of the development following completion of Stage 1A, together with further compression of capitalisation rates in the
Wynyard Quarter, resulted in a net attributable revaluation gain for Ariadne (after minority interests) during the period of $10.3
million after accounting for a deferred tax liability of $4.0 million.
In addition, Ariadne’s share of Orams’ operating income was $4.2 million, and its interest earned on the associated loan to Orams
was $0.1 million.
The results for the period also reflect a non-cash loss of $4.6 million representing the share of earnings attributable to the 30%
interest in Orams NZ Unit Trust acquired by Ariadne in July 2020 (for which settlement will occur following completion of Stage
1B).
The Wynyard Quarter continues to be one of the prime development areas in Auckland, which augurs well for the further commercial
development of the Orams site as well as the residential component of the development.
Ardent Leisure Group Limited (“Ardent”)
During FY21, there was some recovery in the Ardent share price, increasing from 39 cents per share at the start of the period and
closing at 98 cents per share on balance date.
This resulted in an increase in the value of our investment in Ardent (22.6 million shares - representing 4.73% of Ardent’s issued
capital) of $13.4 million during the period.
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Executive Director’s Review
202 1 A N N U A L R E P O R T
The pandemic significantly impacted Ardent’s businesses, with both of its businesses being required to close their operations for a
period.
There are pleasing signs of recovery in Ardent’s US business, Main Event. While the first half of FY21 was challenging as the US
endured a “second wave” of the pandemic, since March Main Event has generated record-breaking sales and profitability performance.
Main Event is well-positioned from a capital and liquidity perspective to resume its rollout of new centres.
Ongoing international and domestic border restrictions and a series of snap lockdowns have placed significant impediments in the
path to recovery at Dreamworld. It is to be hoped that the Federal Government’s plan to “open up” Australia in coming months as
vaccination rates increase significantly will see these restrictions substantially lifted. The business outlook remains optimistic,
supported by pent up demand in local and interstate markets and the new world-class Steel Taipan rollercoaster scheduled to open
prior to the important Christmas/New Year holiday period.
Ardent reported its results to the ASX on 26 August 2021 and the share price has further increased above our carrying value at
balance date.
Hillgrove Resources Limited (“Hillgrove”)
As a result of Hillgrove’s $10.9 million placement and entitlement offer during the period, Ariadne’s holding in Hillgrove reduced
from 24.7% to 19.5%. The capital raising enabled Hillgrove to continue its drilling program at Kanmantoo and advance its mine design
and undertake feasibility studies to commence underground mining. There is the potential to restore value for shareholders if
Hillgrove is able to resume production in the near-term for relatively low capital investment due to the infrastructure already in place
at Kanmantoo.
In May 2021, Ariadne further reduced its interest to 19.0% by a sale of shares on market. The change in relevant interest below a
20% threshold, and the subsequent sale of shares, resulted in management assessing that Ariadne would no longer equity-account its
interest in Hillgrove. The Group’s interest has been reclassified as a strategic investment, with mark-to-market changes in fair value
recorded through Other Comprehensive Income. A mark-to-market gain of $9.0 million was recorded through the profit and loss
on reclassification and a mark-to-market loss of $4.4 million was recorded through Other Comprehensive Income at year end.
ClearView Wealth Limited (“ClearView”)
Ariadne’s ClearView holding appreciated in value by $6.6 million during the period.
In its FY21 results, ClearView disclosed its Embedded Value as 96 cents per share.
With ClearView shares trading at 50 cents per share, there is considerable scope for the difference between Embedded Value per
share and the market price to further narrow, thereby potentially further increasing the market value of our holding.
King River Capital (“King River”)
Ariadne is a Limited Partner of King River, a venture capital fund investing in Australian and US technology companies. King River has
fully invested Fund 1, and is currently raising Fund 2. Ariadne has invested in both funds. In addition to its Fund commitments,
Ariadne has co-invested in several of King River’s portfolio companies.
Three investments, in particular, are performing well in the current environment:
FinClear:
Australia's only full-stack technology platform that provides settlement, execution, and managed account capabilities to brokers,
platforms and wealth managers. FinClear has recently acquired Pershing Securities which will enable it to expand its service offering
to larger stockbrokers and establishes FinClear as the clear market leader. Following that acquisition, FinClear now services more
than 50% of all retail and equity transactions every day and the combined HIN platform will service in excess of $120 billion in listed
securities for investors. FinClear is tracking well ahead of its projections and more than half of its net revenue is recurring under
enterprise “software as a service” contracts and expected to grow.
Lark Technologies:
A digital healthcare company based in California that has built a fully-AI driven platform for chronic disease management. Lark’s ability
to treat patients remotely and at low cost through an AI nurse / chatbot has put the company in a unique position to support the
U.S. healthcare system in a time of desperate need for remote engagement and treatment. The coronavirus crisis has accelerated the
adoption of Lark’s technology and early signs of this are already showing: new federal laws are opening large new markets of the US
patient population to telemedicine, and Lark has seen significant inbound interest in partnering with the company. Lark recently signed
a significant deal with Anthem, one of the largest US health payors, which should begin to generate substantial revenue in 2021.
Cover Genius:
A global multi-line insurance platform that partners with e-commerce businesses worldwide, based in Sydney. While Cover Genius
was heavily exposed to the travel sector, the company acted swiftly at the outset of the pandemic, and accelerated new partnerships
given the boom in e-commerce. The company is experiencing huge demand for its XCover platform from global e-commerce groups
as they look to offer insurance or warranty products to their customers. Customers include Booking Holdings, Amazon, eBay,
Shopee, Skyscanner and Wayfair.
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Executive Director’s Review
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Kippax Property (“Kippax”)
Since the formation of the joint venture (Ariadne is a 50% partner) in December 2019, Kippax has gained traction in executing its
strategy to pursue real estate opportunities around evolving infrastructure investment and urban renewal precincts.
As previously reported, Kippax secured its first site in Redfern, Sydney in May 2020. Kippax initially secured a 50% interest in this
property, and in April 2021 the remaining 50% was secured to achieve full control of the property by call option. Kippax is also the
Development Manager for the project.
Kippax is pursuing planning for redevelopment of an innovative and sustainable commercial office scheme on the site. This project
plays directly to Kippax’s strategy and is set to benefit from the NSW State Government’s infrastructure and stimulus investment
through the upgrade of the nearby Redfern Station and the new Waterloo Metro Station which are now under construction. The
site is also located in the City of Sydney’s Botany Rd Corridor precinct. In July 2021, the City of Sydney released their review of the
corridor and has reported an increase in planning controls (height and floorspace) which is aligned with Kippax’s aspirations for the
site.
Kippax is looking to build on the momentum of Redfern and has identified further pipeline opportunities with a goal of securing
another opportunity through the course of 2021.
Simplified Balance Sheet
Ariadne is in a sound financial position as shown in the following presentation of the Group’s assets and liabilities as at 30 June 2021.
$M
28.6
Liabilities
Payables and Provisions
Deferred Consideration
Debt
Minority Interests
Total Liabilities
Shareholders’ Funds
Assets
Cash
Investments
Orams
Ardent
ClearView
Freshxtend
Kippax
Hillgrove
Trading Portfolio
Other Strategic Assets
FinClear
Foundation Life
King River
Cover Genius
$M
77.6
22.2
14.3
11.9
10.2
9.8
8.5
8.0
5.5
4.8
3.1
2.3
Total Investments
Fixed Assets and Other Receivables
Total Assets
178.2
2.0
208.8
Total Liabilities &
Shareholders’ Funds
$M
1.0
14.6
29.0
15.3
59.9
148.9
208.8
Tax
Ariadne has substantial carry forward revenue and capital losses available to offset future taxable profits. At 30 June 2021 these are
estimated to be $80.4 million (30 June 2020: $83.9 million) and $72.3 million (30 June 2020: $70.6 million) respectively. As at balance
date, Ariadne has a deferred tax asset of $39.7 million which is not recognised in Ariadne’s accounts.
Dividends and Capital Management
In light of the ongoing volatility in market conditions and capital requirements for current investments, the Board has determined to
continue to preserve cash reserves during this highly uncertain period. However, following the return to profitability, the Board has
reinstated the payment of dividends by the payment of a dividend of 0.5 cents per share for FY21.
On 19 February 2021, Ariadne announced the extension of its on-market share buy-back facility as part of ongoing capital management
initiatives.
Dr Gary Weiss, AM
Executive Director
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Directors’ Report
202 1 A N N U A L R E P O R T
The Directors submit their report for the year ended 30 June 2021.
The term “Group” is used throughout this report to refer to the parent entity, Ariadne Australia Limited (“Ariadne”) and its controlled
entities.
All amounts included in this report, other than those forming part of the Remuneration Report, are quoted in thousands of dollars unless
otherwise stated.
1. OPERATING AND FINANCIAL REVIEW
Group Overview
Ariadne’s objective is to hold a portfolio of assets and investments in order to provide attractive investment returns which can generate
regular dividends to shareholders and capital growth in the value of the shareholders’ investments.
The Board of Directors (“Board”) and management have extensive experience investing in securities, financial services, property, merchant
banking and operating businesses.
Ariadne’s principal activities include investing in securities; financial services and property.
Operating Results for the Year
The consolidated net profit after income tax, attributable to the Group from continuing operations for the financial year was $11,534
(2020: $6,835 loss). The consolidated net profit after tax attributable to members, on the same basis, for the financial year was $10,572
(2020: $7,142 loss). In addition, a positive contribution (net of deferred tax) attributable to members of $26,106 (2020: $21,187 negative
contribution) was reported through the Statement of Profit or Loss and Other Comprehensive Income, resulting in a total comprehensive
income attributable to members of $36,678 (2020: $28,329 loss). Net tangible assets at the end of the reporting period were 75.90 cents
per share (2020: 57.21 cents). Total earnings per share were 5.39 cents (2020: -3.64 cents). Total comprehensive earnings per share were
18.69 cents (2020: -14.42 cents).
Investments
The Investment division recorded a profit of $14,980 (2020: $4,213 loss).
The division’s result is derived from interest on cash reserves, share of profits / losses from the Group’s investments in associates, dividends
received, trading income from the trading portfolio and net gains / losses on the strategic portfolio revalued through profit and loss.
Cash and cash equivalents as at 30 June 2021 were $28,629 (2020: $34,916). Ariadne also returned $1,374 (2020: $2,369) during the
period by way of dividends. Ariadne continues to maintain a prudent approach to cash management.
The division’s result includes a one-off revaluation gain of $8,979 following the reduction in the Group’s interest in Hillgrove Resources
Limited (“Hillgrove”) from 24.7% to 19.0% during the period and a corresponding accounting reclassification of the investment from an
‘equity accounted investment’ to an ‘investment carried at fair value’.
The division’s share of joint ventures and associates results for the period was a net profit of $26 (2020: $3,908 net loss). The current
period includes a $1,156 (2020: $4,823) equity accounted loss, being the Group’s share of Hillgrove’s results for the period before the
reclassification.
The trading portfolio recorded a net gain of $4,969 (2020: $1,955 loss) and the strategic portfolio revalued through profit or loss recorded
a net loss of $47 (2020: $1,003 gain) during the reporting period due to mark-to-market revaluations.
The strategic portfolio revalued through other comprehensive income recorded a gain net of tax of $16,364 (2020: $28,899 net loss)
during the reporting period due to mark-to-market revaluations including a $6,579 markup (2020: $11,156 markdown) of the Group’s
investment in ClearView Wealth Limited and a $13,377 markup (2020: $14,963 markdown) of the Group’s investment in Ardent Leisure
Group Limited. The Board anticipates that the respective share prices of these holdings will recover further to reflect their intrinsic value
over time. Both the mark-to-market gain and any associated deferred tax expense attributable to the strategic portfolio are not included
in the reported net profit.
The Group also accrued NZ$342 (2020: NZ$362) from Foundation Life (NZ) Ltd during the year comprised of loan note interest.
Ariadne’s 53% interest in Freshxtend International Pty Ltd, with its 17% investment in the NatureSeal group, again contributed positively
during the period, albeit at lower levels than previously as the patent expiration of key NatureSeal products continues to impact on overall
margins.
Car Parking
The Group’s car parking operations ceased in June 2020 on the termination of its last remaining car park lease. A profit of $45 was
recorded in the prior period.
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Directors’ Report
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Property
The Group’s Property division recorded a loss of $273 (2020: $67 loss).
During the period Orams NZ Unit Trust (“ONZUT”) became a controlled entity of the Group with its results consolidated by the Group
from 14 July 2020. ONZUT holds a debt and equity interest in Orams Group Limited (“OGL”) and is partially funded by an external loan
facility.
The division’s result is derived from the Group’s 76% interest in Orams - the owner of Orams Marine Village and Orams Marine Services,
New Zealand’s premier marine facility and largest marine maintenance and refit services business respectively, interest received on its
secured loan to Orams and the change in the deferred contingent liability for the purchase price of the additional 30% equity interest
(“Deferred Consideration”) in the ONZUT acquired in July 2020. The result also includes Ariadne’s 50% interest in the Kippax Property
Trust.
The Group’s share of profit from Orams during the period was $5,263 and its interest earned on the associated loan to Orams was $168.
In addition, a positive contribution of $12,878 representing the Group’s share of the uplift in valuation of the marina was reported through
other comprehensive income. A $4,631 loss relating to the Deferred Consideration, due to and equal to 30% of the increase in ONZUT’s
net assets during the period, was also recognised in reported net profit. The terms of the Deferred Consideration provide that the
purchase price will be determined and paid following completion of the Site 18 Stage 1 Works (as defined in the Development Agreement
with Panuku Development Auckland) which is expected to be before June 2026.
Orams is developing a new state-of-the-art marine refit facility on its existing site and an adjoining property known as Site 18 in downtown,
Auckland’s Wynyard quarter. This will treble Orams Marine Services’ current capacity for marine maintenance and refit business. The
marine works completed include, remediation of the new marine area including a groundwater cut-off wall, strengthening of the seawall, a
concrete fibre reinforced hardstand area providing marine haul out space and installation of new travel lift piers – all on time and within
budget. New 820 and 85 tonne travel lifts were commissioned and have been operational since January 2021. In addition to the works
completed, the three-stage development will feature a refit facility, commercial buildings and a residential component on the northern end
of Site 18. The facility will target marine vessels (including superyachts) up to 800 tonnes. The development will also provide increased
maintenance facilities for Auckland’s ferries, fishing vessels and commercial vessels.
We believe that the development has the potential to create significant value for shareholders over time.
Taxation
Ariadne has significant carried forward revenue and capital losses available to offset future taxable profits. At 30 June 2021, these are
estimated at $80,378 (2020: $83,940) and $72,292 (2020: $70,599) respectively.
In accordance with the Group’s accounting policy for income tax, an assessment was undertaken to estimate the probable recoverability
and sufficiency of the Group’s deferred tax assets. The assessment determined that no deferred tax asset would be recorded on the
Group’s Balance Sheet at 30 June 2021 (2020: nil).
Employees
The number of employees, including directors, at balance date is 11 (2020: 10), 73% male and 27% female (2020: 70%:30%).
2. DIVIDENDS AND CAPITAL MANAGEMENT
The Directors have declared a partially franked (40%) final dividend of $981 (0.5 cents per share) in relation to the 2021 financial
year, of which 60% is sourced from the Conduit Foreign Income Account. As the final dividend for 2021 was declared after balance
date, no liability was recognised at balance date. The FY20 interim dividend of $1,374 (0.7 cents per share) declared in February 2020
and deferred in March 2020, was paid on 24 September 2020.
On 19 February 2021, Ariadne announced the twelve month extension of its on-market share buy-back facility as part of ongoing
capital management initiatives. The buy-back is for the purpose of acquiring shares where they are trading at prices below the Board’s
view of the intrinsic value of the shares, such acquisitions benefiting all shareholders.
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Directors’ Report
3. DIRECTORS
202 1 A N N U A L R E P O R T
The names and details of Ariadne’s Directors in office at the date of this report are set out below. All Directors were in office for the
entire period unless otherwise stated.
Names, qualifications, experience and special responsibilities
David Baffsky, AO, LLB
Independent Non-Executive Chairman
Mr Baffsky AO, was appointed as a Director of Ariadne on 18 March 2008 and Chairman of the Board on 13 January 2009.
Mr Baffsky holds a law degree from the University of Sydney and was the founder, and until 1991, the senior partner of a Sydney legal
firm specialising in commercial and fiscal law. Mr Baffsky is Honorary Chairman (formerly Executive Chairman between 1993 and 2008)
of Accor Asia Pacific, which is the largest hotel management company in the Asia Pacific region. He is Chairman of Investa Property
Group. Amongst previous roles, Mr Baffsky was a Director of Destination NSW, The George Institute, the Australian Brandenburg
Orchestra and a board member of Sydney Olympic Park Authority. He was a Director of SATS Limited, Chairman of Food & Allied
Support Services Corporation Ltd, a Trustee of the Art Gallery of NSW, Chairman of Voyages Indigenous Tourism Ltd and a Director
of the Indigenous Land Corporation. He was a member of the Business Government Advisory Group on National Security and a member
of the Federal Government’s Northern Australia Land and Water Taskforce. In 2001 Mr Baffsky was made an Officer in the General
Division of the Order of Australia and in 2003 he received the Centenary Medal. In 2004 he was recognised as the Asia Pacific Hotelier
of the Year. In 2012 he was awarded the Chevalier in the Order of National Légion d’Honneur of France.
Mr Baffsky was appointed to the Ariadne Audit and Risk Management Committee on 18 March 2008.
Kevin Seymour, AM
Non-Executive Deputy Chairman
Mr Seymour AM, was appointed as a Director of Ariadne on 23 December 1992.
Mr Seymour is the Executive Chairman of Seymour Group, one of the largest private property development and investment
companies in Queensland and has substantial experience in the equities market in Australia and has extensive management and
business experience including company restructuring. Mr Seymour holds board positions with several private companies in Australia.
Mr Seymour was previously a Director of UNiTAB and then Tatts Group Limited. When the merger was completed between Tatts
Group and Tabcorp Limited he completed his term as Director on 22 December 2017. Mr Seymour was also previously the
Chairman of Watpac Limited, the Chairman of the RBH Herston Taskforce Redevelopment, Independent Chairman of the
Queensland Government’s and Brisbane City Council's Brisbane Housing Company Limited and Chairman of Briz31 Community
TV. He has also served on the Brisbane Lord Mayor's Drugs Taskforce and is an Honorary Ambassador for the City of Brisbane. In
June 2003, Mr Seymour received the Centenary Medal for distinguished service to business and commerce through the construction
industry, and in June 2005 he was awarded the Order of Australia Medal for his service to business, the racing industry, and the
community.
Christopher Barter, BSc Phy, Msc Phy
Independent Non-Executive Director
Mr Barter was appointed as a Director of Ariadne on 22 February 2018.
Mr Barter is the Co-Founder and Partner of King River Capital, a venture capital firm for high growth companies with offices in
Sydney and San Francisco. He is a seasoned venture investor and accomplished finance leader with a long track record of building
profitable businesses and generating strong returns. His extensive global experience and network has aided his portfolio companies
with business development, capital raising and market expansion strategies.
Prior to co-founding King River, Mr Barter has long been a dedicated global venture capital investor. He launched two fund
management platforms along with partners that collectively raised in excess of US$600M, and has led investor syndicates in multi-
stage software ventures via CKA Capital and other entities resulting in 28 early to mid-stage investments in verticals including
fintech, AI-enabled businesses, and digital healthcare. His portfolio includes Flipkart, DiDi, Palantir, Wish, Ola, Delos and Meituan.
Mr Barter spent the first nineteen years of his career at Goldman Sachs, where he was a Partner and was based in Frankfurt, London
and Moscow. He was co-Head of the European Financial Institutions Group in the Investment Banking Division, and in that role co-
founded a fund management business which today commands a multi-billion dollar market valuation.
Mr Barter currently serves on the boards of CNG Fuels, FinClear, and on the advisory board of GreenSync. He also serves on the
President’s Leadership Council at Brown University. Mr Barter obtained a BSc in Physics from Brown University and an MSc in
Physics from Harvard University.
Mr Barter was appointed as a member of the Audit and Risk Management Committee on 22 March 2019.
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Directors’ Report
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John Murphy, B Com, M Com, CA, FCPA
Independent Non-Executive Director
Mr Murphy, was appointed as a Director of Ariadne on 6 December 2006.
Mr Murphy was a partner in international accounting firm Arthur Andersen where he specialised in merger and acquisition and insolvency
and reconstruction. He held management positions in that firm at the Australian, regional and global level. He has also spent twenty years
as the founder and managing director of various private equity funds including Investec Wentworth Private Equity Limited and Adexum
Capital limited. He was a Director of Investec Bank Australia Limited from 2004 until 2013.
Mr Murphy has extensive public company experience having been a Director of listed companies Southcorp Limited, Specialty Fashion
Group Limited, Vocus Communications Limited, Gale Pacific Limited, Redflex Limited, and Australian Pharmaceutical Industries Limited.
Mr Murphy was appointed to the Ariadne Audit and Risk Management Committee on 6 December 2006 and was elected Committee
Chairman on 18 March 2008.
Benjamin Seymour, LLB (Hons), BBusMan, GDLP
Non-Executive Alternate Director to Mr Kevin Seymour
Mr Seymour, was appointed as an Alternate Director of Ariadne on 15 December 2020.
Mr Seymour is an Associate Director of Seymour Group, one of Queensland’s most prominent privately-owned property development
and investment companies established by his grandparents, Kevin and Kay in 1976. On completion of his university studies Mr Seymour
spent time in QIC’s Global Real Estate business working throughout investment and funds management. He was admitted as a solicitor
in the Supreme Court of Queensland in 2020 and currently practices as a corporate lawyer with a focus on private equity and M&A. Mr
Seymour’s business interests and activities extend into high-end residential and commercial property development through his
directorship of Queensland Prime Investments, in conjunction with investments across venture capital, global equities and debt through
BS1 Capital. He obtained a Bachelor of Laws (Honours) and Bachelor of Business Management majoring in Property Development and
Real Estate from the University of Queensland, and is a member of the Australian Institute of Company Directors and the Urban
Development Institute of Australia.
Dr Gary Weiss, AM, LLB (Hons), LLM, JSD
Executive Director
Dr Weiss, was appointed as a Director of Ariadne on 28 November 1989.
Dr Weiss is Chairman of Ardent Leisure Limited (appointed 29 September 2017, having been appointed Director on 3 September 2017),
Estia Health Ltd (appointed 1 January 2017, having been a Director since 24 February 2016), and Cromwell Property Group (appointed
17 March 2021, having been elected as a director on 18 September 2020) and a director of Hearts and Minds Investments Limited
(appointed 12 September 2018), and Thorney Opportunities Ltd (appointed 21 November 2013). Dr Weiss was also appointed a
Commissioner of the Australian Rugby League Commission on 30 August 2016.
During the past three years, Dr Weiss has also served as Chairman of Ridley Corporation Limited (appointed 1 July 2015, having been
appointed Director on 21 June 2010 and resigned 26 August 2020), Director of Premier Investments Limited (appointed 11 March 1994
and resigned 28 July 2018) and, The Straits Trading Company Limited (appointed on 1 June 2014 and resigned on 30 September 2020).
4. COMPANY SECRETARY
Natt McMahon, B Com, M AppFin, SA Fin, CA, FGIA, FCIS
Mr McMahon was appointed Chief Financial Officer and Company Secretary for the Group on 18 May 2012.
Prior to joining Ariadne, Mr McMahon held senior financial roles with various local and overseas entities.
5. SIGNIFICANT EVENTS AFTER THE BALANCE DATE
After the balance date, the Directors declared a final dividend on ordinary shares in respect of the 2021 financial year. The total amount
of the dividend is $981 which represents a partially franked (40%) dividend of 0.5 cents per share, of which 60% is sourced from the
Conduit Foreign Income Account.
The outbreak of COVID-19 and the subsequent quarantine measures imposed by the Australian and other governments as well as the
travel and trade restrictions imposed by Australia and other countries in early 2020 have caused significant and widespread disruption to
businesses and economic activity in Australia. At the date of approving these financial statements, the Directors are of the view the effects
of COVID-19 do not change the significant estimates, judgements and assumptions in the preparation of the financial statements, however
COVID-19 and its associated economic impacts remain uncertain. The Directors continue to closely monitor developments with a focus
on potential financial and operational impacts and note that the situation is continuing to evolve.
Apart from the matters above, there is no other matter of circumstance that has arisen since 30 June 2021 that has significantly affected,
or may significantly affect the Group’s operations, the results of those operations, or the Group’s state of affairs in the future financial
periods.
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A R I A D N E A U S T R A L I A L I M I T E D
Directors’ Report
202 1 A N N U A L R E P O R T
6. LIKELY DEVELOPMENTS AND EXPECTED RESULTS
Ariadne intends to continue its investment activities as it has done for many years. The results of these investment activities depend on
the performance of the companies and securities in which the Group invests. Their performance in turn depends on many economic
factors. These include economic growth rates, inflation, interest rates, exchange rates and taxation levels. There are also industry and
company specific issues including management competence, capital strength, industry economics and competitive behaviour. The
composition of the Group’s investment portfolio can change dramatically from year to year. As a consequence profit flows are
unpredictable as the rewards from a successful long term investment may be accrued in a single transaction.
Ariadne does not believe it is possible or appropriate to make a prediction on the future course of markets or the performance of its
investments. Accordingly, Ariadne does not provide a forecast of the likely results of its activities. However, the Group’s focus is on
results over the medium to long term and its twin objectives are to provide shareholders with regular dividends and capital growth in
the value of shareholders’ investments.
7. ENVIRONMENTAL REGULATION AND PERFORMANCE
The Group’s environmental obligations are regulated by relevant federal, state and local government ordinances. The Group’s policy is
to comply with its environmental performance obligations. No material exposure to environmental or social risks were identified during
the period.
8. REMUNERATION REPORT (AUDITED)
All amounts in the Remuneration Report are stated in whole numbers unless otherwise specified.
The Remuneration Report outlines the Director and Executive remuneration arrangements of the Group in accordance with the
requirements of the Corporations Act 2001 and its Regulations.
Remuneration Philosophy
The performance of the Group depends upon the quality of its Directors, Executive Officers and employees.
Remuneration of Directors and Executive Officers of the Group is established by annual performance review, having regard to market
factors and a performance evaluation process. For Executive Officers remuneration packages generally comprise salary, superannuation
and a performance-based bonus.
Remuneration Structure
In accordance with good corporate governance the structure of Non-Executive Director and Executive Officer remuneration is separate
and distinct.
Non-executive Remuneration
Objective
The Board seeks to set aggregate remuneration at a level which provides the Group with the ability to attract and retain Directors of
the highest calibre, whilst incurring a cost which is acceptable to shareholders.
Structure
Ariadne’s Constitution and the Australian Securities Exchange (“ASX”) Listing Rules specify that the aggregate remuneration of Non-
Executive Directors shall be determined from time to time by a general meeting. An amount not exceeding the amount determined is
then divided between the Directors as agreed. The latest determination, approved by shareholders on 24 November 2011, provided for
an aggregate limit of Non-Executive Directors’ remuneration (including superannuation) of $500,000 per annum.
The amount of aggregate remuneration sought to be approved by shareholders and the manner in which it is apportioned amongst
Directors is reviewed annually. The Board considers fees paid to Non-Executive Directors of comparable companies when undertaking
the annual review process.
Directors are also reimbursed for reasonable travel expenses in attending Board and Committee meetings and other costs associated
with representing the Group in specific matters from time to time.
10
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Directors’ Report
Executive Remuneration
Objective
The Group aims to reward Executives with a level and mix of remuneration commensurate with their position and responsibilities within
the Group so as to:
reward Executives for performance against targets set by reference to appropriate benchmarks;
align the interests of Executives with those of shareholders;
link reward with the strategic goals and performance of the Group; and
ensure total remuneration is competitive by market standards.
Structure
In determining the level and make up of Executives’ remuneration, the Board considers market levels of remuneration for comparable
roles and employee performance. Remuneration consists of the following key elements:
Fixed remuneration
Variable remuneration
The Board establishes the proportion of fixed and variable remuneration for each Executive.
Fixed Remuneration
Objective
The level of fixed remuneration is set so as to provide a base level of remuneration, which is both appropriate to the position and is
competitive in the market. Fixed remuneration is reviewed annually.
Structure
Fixed remuneration is paid in cash.
Variable Remuneration
Objective
The objective of variable remuneration is to reward Executives in a manner which aligns this element of remuneration with the creation
of shareholder wealth.
Structure
Variable remuneration is generally only offered to Executives who are able to influence the generation of shareholder wealth and have a
direct impact on the Group’s performance. Due to the operations of the Group, the value of variable remuneration may be linked to the
outcome of specific transactions in addition to the Group’s overall financial performance. Comprehensive Earnings per Share (“CEPS”),
Return on Equity (“ROE”), and project Internal Rate of Return (“IRR”) as calculated in accordance with applicable accounting standards
and accepted valuation techniques may be used as key indicators of performance.
Variable remuneration may be in the form of cash bonuses or longer term incentives in the form of Ariadne share options. Cash based
variable remuneration is used to reward Executives for exceptional performance. The nature of the Group’s activities lends itself to a
market where cash based incentives are prevalent. While individual performance may be rewarded by way of cash based payments, the
Board also considers the use of longer-term incentives in order to align the interests of employees and shareholders.
A share option plan has been established where the Board may grant options over the ordinary shares of Ariadne to Executives as a long-
term incentive payment. The options, issued for nil consideration, are granted as variable remuneration. All options are issued at the
discretion of the Board, there are no fixed guidelines.
Each option entitles the holder to subscribe for one fully paid ordinary share in Ariadne at a specified price. The options are issued for a
term of five years and are exercisable two years from the date of grant. The options cannot be transferred and will not be quoted on the
ASX. Option holders do not have any right, by virtue of the option, to participate in any share right issues or dividends.
11
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Directors’ Report
Details of Key Management Personnel Remuneration
(a) Details of Key Management Personnel
(i) Directors
D Baffsky, AO
K Seymour, AM
C Barter
J Murphy
B Seymour
G Weiss, AM
(ii) Executives
N McMahon
D Weiss
Independent Non-Executive Chairman
Non-Executive Deputy Chairman
Independent Non-Executive Director
Independent Non-Executive Director
Non-Executive Alternate Director to K Seymour, AM
Executive Director
Chief Financial Officer / Company Secretary
Investment Officer
(b) Remuneration of Directors and Executives
Remuneration Policy
The Board acts as the Group’s Remuneration Committee and is responsible for determining and reviewing compensation arrangements
for the Directors and the Executive team. The Directors assess the appropriateness of the nature and amount of emoluments on a
periodic basis by reference to relevant employment market conditions with the overall objective of ensuring maximum stakeholder
benefit from the retention of a high quality Board and Executive team.
Directors’ remuneration primarily consists of a base salary.
Officers receive their base emolument in the form of cash payments. Once the Directors’ approval is granted, bonuses are paid by way
of cash or longer term incentives in the form of Ariadne share options. The Directors link the nature and amount of Executive Directors’
and Officers’ emoluments to the Group’s financial and operational performance.
Superannuation Commitments
All superannuation payments on behalf of the Group’s Directors and staff are paid to externally administered superannuation funds. The
Group makes contributions in accordance with Superannuation Guarantee Legislation.
12
A R I A D N E A U S T R A L I A L I M I T E D
Directors’ Report
Short Term Employee Benefits
Non-
Monetary
Benefits(i)
Cash
Bonus
Salary &
Fees
202 1 A N N U A L R E P O R T
Post-
Employment
Benefits
Share
Based
Payment
Superan-
nuation
Options(ii)
Total
% at Risk
15,071
15,512
12,350
12,350
Table 1: Emoluments of Directors of Ariadne
35,000
70,000
130,000
130,000
D Baffsky, AO (Chairman)
2021
2020
K Seymour, AM (Deputy Chairman)
2021
2020
C Barter
2021
2020
J Murphy
2021
2020
B Seymour, AM (Alternate Director to K Seymour, AM)(iii)
2021
2020
G Weiss, AM (Executive Director)
2021
2020
570,000
672,748
35,000
—
70,000
70,000
80,000
80,000
Total Remuneration: Directors
2021
2020
920,000
1,022,748
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
15,071
15,512
30,142
31,024
Table 2: Emoluments of the Executive Officers of the Group
N McMahon (Chief Financial Officer / Company Secretary)
2021
2020
D Weiss (Investment Officer)(iv)
2021
2020
406,317
347,079
282,513
281,822
Total Remuneration: Executives
2021
2020
688,830
628,901
—
—
—
—
—
—
—
—
15,071
15,512
15,071
15,512
—
—
—
—
—
—
—
—
—
—
—
—
—
—
157,421
157,862
38,325
76,650
76,650
76,650
87,600
87,600
38,325
—
615,071
718,260
1,013,392
1,117,022
—
—
—
—
—
—
—
—
—
—
—
—
—
—
1,955
17,335
1,955
17,335
309,468
324,157
445,037
400,929
0.63%
5.35%
0.44%
4.32%
3,325
6,650
6,650
6,650
7,600
7,600
3,325
—
30,000
30,000
63,250
63,250
25,000
25,000
21,694
21,003
46,694
46,003
3,910
34,670
754,505
725,086
0.52%
4.78%
(i)
(ii)
(iii)
(iv)
Non-monetary benefits represent the cost of car parking (including associated fringe benefits tax).
Refer to Table 3 - Option holdings of Directors and Executives.
Mr Ben Seymour was appointed an Alternate Director to Mr Kevin Seymour, AM on 15 December 2020.
Mr Weiss’s 2021 salary and fees include $59,238 of annual leave paid out in cash.
Table 3: Option holdings of Directors and Executives
Executives
N McMahon
D Weiss
Total
Balance
1 July 2020
Granted as
Remuneration
Options
Exercised
Options
Expired
Balance
30 June 2021
Vested and
Exercisable
500,000
1,000,000
1,500,000
—
—
—
—
—
—
—
500,000
500,000
500,000
500,000
1,000,000
500,000
500,000
1,000,000
Each option entitles the holder to purchase one Ariadne share at a specified price. The options have a vesting period of two years from
the date the option is issued followed by an exercise period of three years. The options may not be exercised during the vesting period.
In accordance with the terms and conditions, options are either exercised, lapse or expire on cessation of employment. If options are not
exercised in the exercise period, they lapse.
Options granted as part of Executive emoluments have been valued using the Black Scholes pricing model, which takes account of factors
including the option exercise price, the volatility of the underlying share price, the risk-free interest rate, expected dividends on the
underlying share, market price of the underlying share and the expected life of the option. The amortised cost to the Group has been
calculated as the fair value of options at grant date, prorated over the vesting period of the options. The actual value of the options will
only be determined after the exercise period commences and when the options are exercised.
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A R I A D N E A U S T R A L I A L I M I T E D
Directors’ Report
202 1 A N N U A L R E P O R T
Key inputs used in valuing the options on issue at balance date are as follows:
Grant
Date
Expiry
Date
Dividend
Yield
Expected
Volatility
Risk Free
Interest
Rate
Expected Life of
Options from Grant
Date (years)
18/08/2017 17/08/2022
17/08/2018 16/08/2023
2.6%
5.3%
25.2%
34.9%
2.2%
2.2%
3.5
3.5
Exercise
Price
(cents)
73.0
63.0
Share Price at
Grant Date
(cents)
Fair Value of
Option at Grant
Date (cents)
76.0
65.5
13.4
12.1
Table 4: Shareholdings of Directors and Executives
Ordinary shares held in
Ariadne
Directors
D Baffsky, AO
K Seymour, AM
C Barter
J Murphy
B Seymour
G Weiss, AM
Executives
N McMahon
D Weiss
Total
Balance
1 July 2020
On Exercise
of Options
Net Change
Other
Balance
30 June 2021
5,182,713
13,987,394
2,000,000
586,632
—
65,739,743
440,428
2,199
87,939,109
—
—
—
—
—
—
—
—
—
—
—
—
—
386,692
—
—
—
386,692
5,182,713
13,987,394
2,000,000
586,632
386,692
65,739,743
440,428
2,199
88,325,801
All equity transactions with Directors and Executives other than those arising from the exercise of remuneration options have been
entered into under terms and conditions no more favourable than those the entity would have adopted if dealing at arm’s length. Currently
no Director or Executive has disclosed to Ariadne that they have used hedging instruments to limit their exposure to risk on either shares
or options in Ariadne. The Group’s policy is that the use of such hedging instruments is prohibited.
(c) Indemnification and insurance of Directors and Officers
Insurance and indemnity arrangements concerning Officers of the Group are in place. Ariadne’s Constitution provides an indemnity (to
the extent permitted by law) in favour of each Director, Secretary and Executive Officer. The indemnity is against any liability incurred by
that person in their capacity as a Director, Secretary or Executive Officer to another person (other than Ariadne or a related body
corporate), unless the liability arises out of conduct involving a lack of good faith. The indemnity includes costs and expenses incurred by
an Officer in successfully defending that person’s position. The Group has paid a premium insuring each Director, Secretary and full-time
Executive of the Group against certain liabilities incurred in those capacities, to the extent permitted by law. Disclosure of premiums and
coverage has not been included as such disclosure is prohibited under the terms of the contract of insurance.
(d) Loans to / from Directors and Executives
A three-month non-interest-bearing loan from an entity controlled by Mr Kevin Seymour, AM for $6,500,000 was made to the Company
on 15 April 2021. After balance date the loan was extended and a repayment of $3,000,000 was made leaving $3,500,000 outstanding at
the date of this report. No other loans to or from Directors and Executives were made, repaid or outstanding during the current and
prior financial periods.
(e) Other transactions and balances with Directors and Executives
Purchases / Payments
Mr Barter is an Executive Director of King River Capital Management Pty Ltd (“KRC”). The Group made investments of $1,196,732 (2020:
$2,724,472) during the period which were associated with or otherwise managed by KRC. The Group paid management fees of $195,701
(2020: $159,870) relating to investments managed by KRC.
Mr Barter, KRC and entities associated with KRC were appointed as authorised representatives for one of the Group’s wholly owned
subsidiaries, which holds an Australian Financial Services Licence, for part of the period under an agreement. During the period, the Group
received $24,000 (2020: $30,000) from KRC relating to this agreement.
Mr Baffsky performed various consulting services to the Group outside of his Director’s duties. Mr Baffsky was paid on commercial terms
for consulting work performed of $43,800 (2020: $43,800). Mr Baffsky, in his role as Chairman of the Board of Directors and for other
purposes, utilises an office and car park at premises leased by the Group.
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A R I A D N E A U S T R A L I A L I M I T E D
Directors’ Report
202 1 A N N U A L R E P O R T
Investments
The Group holds investments in, or managed by, entities where the officers of the Group hold a board position:
Ardent Leisure Group Limited
FinClear Pty Ltd
Hearts and Minds Investments Limited
Thorney Opportunities Limited
King River Capital Management Pty Ltd
Dr G Weiss
Mr C Barter
Dr G Weiss
Dr G Weiss
Mr C Barter
Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Executive Director
(f) Historical Group Performance
The table below illustrates the Group’s performance over the last five years. These results include non-recurring items and asset
impairment write-downs.
Total comprehensive income / (loss) after tax
attributable to members
Return on equity (%) #
Total comprehensive earnings per share (cents)
Dividends paid / declared (cents)
Share price (cents at 30 June)
Net tangible assets per security (cents at 30 June)
2021
Restated
2020
2019
2018
2017
36,678
(28,329)
(26,664)
10,209
91,522
28.1%
18.69
—
55.00
75.90
(22.1%)
(14.42)
1.70
39.00
57.21
(16.6%)
(13.48)
1.70
62.50
73.29
5.8%
5.10
3.50
65.00
88.25
70.2%
45.50
2.00
76.00
86.58
Shares on issue (number at 30 June)
# Return on equity is calculated as total comprehensive income for the period divided by average equity for the period.
196,242,360
196,242,360
196,892,360
199,669,088
201,227,785
Remuneration Report (Audited) Ends
15
A R I A D N E A U S T R A L I A L I M I T E D
Directors’ Report
9. DIRECTORS’ MEETINGS
202 1 A N N U A L R E P O R T
The number of meetings of Directors (including meetings of committees of Directors) held during the year and the number of meetings
attended by each of the Directors were as follows:
Directors’
Meetings
Meetings of Committees
Audit & Risk Management
Number of meetings held:
Number of meetings attended:
D Baffsky, AO
K Seymour, AM
C Barter
J Murphy
B Seymour (Alternate Director, appointed 15 December 2020)
G Weiss, AM
Committee membership
6
6
6
5
6
3
6
4
3
n/a
4
4
n/a
n/a
As at the date of this report, Ariadne had an Audit and Risk Management Committee. Members acting on the Committee during the
year were:
J Murphy (Chairman)
D Baffsky, AO
C Barter
10. ROUNDING
The amounts contained in the financial report have been rounded to the nearest thousand dollars (where rounding is applicable) under
the option available to Ariadne in accordance with ASIC Instruction 2016/191.
11. AUDITOR’S INDEPENDENCE DECLARATION TO THE DIRECTORS
A copy of the auditor’s independence declaration as required under Section 307C of the Corporations Act 2001 is set out on the following
page and forms part of the Directors’ Report for the year ended 30 June 2021.
12. NON-AUDIT SERVICES
There were no non-audit services provided by Ariadne’s auditor, Grant Thornton Audit Pty Ltd in the current financial year.
Signed in accordance with a resolution of the Directors
Mr David Baffsky, AO
Chairman
Sydney
30 August 2021
16
A R I A D N E A U S T R A L I A L I M I T E D
Auditor’s Independence Declaration
202 1 A N N U A L R E P O R T
17
A R I A D N E A U S T R A L I A L I M I T E D
Statement of Profit or Loss and Other
Comprehensive Income
FOR THE YEAR ENDED 30 JUNE 2021
202 1 A N N U A L R E P O R T
Notes
2021
$’000
GROUP
Restated
2020
$’000
CONTINUING OPERATIONS
Rental income
Interest income
Dividend income
Net fair value gain / (loss) on trading portfolio
Net gain on equity accounted investments reclassified as securities
Fair value loss on financial liabilities
Other income, gains & losses
Share of joint ventures’ and associates’ profits / (losses)
Rental expenses
Employee benefits expense
Depreciation and amortisation
Administration expenses
Finance costs
Impairment reversals / (provisions)
PROFIT / (LOSS) BEFORE INCOME TAX
Income tax expense
PROFIT / (LOSS) AFTER TAX FOR THE PERIOD
Attributable to:
Non-controlling interests
MEMBERS OF ARIADNE
4(a)
13(a)
24(i)
4(b)
13(b)
4(c)
4(d)
5(a)
OTHER COMPREHENSIVE INCOME
Items that will not be reclassified subsequently to profit or loss
Net fair value movement of the strategic portfolio revalued through OCI, net of tax 11
Items that may be reclassified subsequently to profit or loss
Net fair value movement of cash flow hedges
Net fair value movement of property assets, net of tax
Exchange difference on translation of foreign operations
OTHER COMPREHENSIVE INCOME FOR THE PERIOD, NET OF TAX
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD
Attributable to:
Non-controlling interests
MEMBERS OF ARIADNE
Earnings per share
Basic earnings per share (cents)
Diluted earnings per share (cents)
—
987
401
4,969
8,979
(4,631)
485
5,068
—
(2,267)
(586)
(983)
(1,016)
128
11,534
—
11,534
962
10,572
8,732
1,854
347
(1,955)
—
—
2,176
(4,488)
(938)
(2,434)
(8,199)
(936)
(523)
(471)
(6,835)
—
(6,835)
307
(7,142)
16,364
(28,899)
—
12,878
(1,091)
28,151
(6)
7,890
(50)
(21,065)
39,685
(27,900)
3,007
36,678
429
(28,329)
5.39
5.39
(3.64)
(3.63)
The statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.
18
A R I A D N E A U S T R A L I A L I M I T E D
Balance Sheet
AS AT 30 JUNE 2021
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Financial assets
Other current assets
Total Current Assets
Non-Current Assets
Receivables
Financial assets
Investments in joint ventures and associates
Property, plant and equipment
Total Non-Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Lease liabilities
Loans and borrowings
Provisions
Total Current Liabilities
Non-Current Liabilities
Lease liabilities
Loans and borrowings
Other payables
Provisions
Total Non-Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
EQUITY ATTRIBUTABLE TO MEMBERS OF ARIADNE AUSTRALIA LIMITED
Non-controlling interests
TOTAL EQUITY
The balance sheet should be read in conjunction with the accompanying notes.
19
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes
2021
$’000
GROUP
Restated
2020
$’000
8
9
10
11
13(b)
14
14
24
15(a)
15(c)
15(d)
28,629
1,863
8,448
107
39,046
18,992
65,755
84,846
179
169,772
208,818
254
53
15,046
628
15,981
—
13,960
14,586
11
28,557
44,538
164,280
34,916
2,476
5,782
90
43,264
16,759
30,249
35,917
760
83,685
126,949
2,033
364
5,450
454
8,301
53
—
—
117
170
8,471
118,478
378,156
182,543
(411,750)
148,949
15,331
164,280
378,156
140,155
(406,044)
112,267
6,211
118,478
Statement of Changes in Equity
202 1 A N N U A L R E P O R T
Issued
capital
$’000
Note 15(a)
Reserves
$’000
Note 15(c)
Accumulated
losses
$’000
Note 15(d)
ARIADNE
$’000
Non-
controlling
interest
$’000
FOR THE YEAR ENDED 30 JUNE 2020
At 1 July 2019
Profit / (loss) for the period
Other comprehensive income
Total comprehensive income for the period
Cost of shares bought back
Cost of share-based payment
Dividends
At 30 June 2020
FOR THE YEAR ENDED 30 JUNE 2021
378,558
—
—
—
(402)
—
—
163,680
968
(21,187)
(20,219)
—
35
(3,341)
(397,934)
(8,110)
—
(8,110)
—
—
—
144,304
(7,142)
(21,187)
(28,329)
(402)
35
(3,341)
378,156
140,155
(406,044)
112,267
At 1 July 2020
378,156
140,155
(406,044)
112,267
Profit / (loss) for the period
Other comprehensive income
Total comprehensive income for the period
Transfer of reserves to accum. losses
Acquisition of non-controlling interest
Cost of share-based payment
Dividends
At 30 June 2021
—
—
—
—
—
—
—
16,319
26,106
42,425
(41)
—
4
—
(5,747)
—
(5,747)
10,572
26,106
36,678
41
—
—
—
—
—
4
—
GROUP
$’000
150,460
(6,835)
(21,065)
(27,900)
(402)
35
(3,715)
118,478
118,478
11,534
28,151
39,685
—
6,636
4
(523)
6,156
307
122
429
—
—
(374)
6,211
6,211
962
2,045
3,007
—
6,636
—
(523)
378,156
182,543
(411,750)
148,949
15,331
164,280
The statement of changes in equity should be read in conjunction with the accompanying notes.
20
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
GROUP
Notes
2021
$’000
2020
$’000
—
1,496
(4,017)
2,009
430
—
111
(1,001)
(16)
(988)
(5)
492
(1,075)
—
(1,446)
71
(7,918)
39
(9,842)
(364)
(1,396)
8,200
—
(1,374)
(523)
4,543
34,916
(6,287)
28,629
9,605
727
(4,869)
1,837
226
(1,000)
1,285
(309)
(213)
7,289
(4)
—
(1,151)
2,383
(3,237)
151
(2,430)
—
(4,288)
(7,941)
(332)
950
(402)
(1,967)
(374)
(10,066)
41,981
(7,065)
34,916
Statement of Cash Flows
FOR THE YEAR ENDED 30 JUNE 2021
Cash flows from operating activities
Receipts from rental income
Receipts from other income
Payments to suppliers and employees
Dividends and trust distributions received
Receipts from trading portfolio sales
Payments for trading portfolio purchases
Interest received
Interest and borrowing costs paid
Lease liability interest paid
Net cash flows (used in) / from operating activities
16
Cash flows from investing activities
Payments for plant and equipment
Divestments of joint ventures and associates
Investments in joint ventures and associates
Proceeds from strategic portfolio sales
Payments for strategic portfolio purchases
Loans repaid by other parties
Loans advanced to other parties
Acquisition of subsidiary, net of cash acquired
Net cash flows used in investing activities
Cash flows from financing activities
Repayment of lease liabilities
Repayments of borrowings
Proceeds from borrowings
Payments under share buy-back
Dividends paid to members of the parent entity
Dividends paid to non-controlling interests
Net cash flows from / (used in) financing activities
Cash and cash equivalents at beginning of period
Net decrease in cash and cash equivalents
Cash and cash equivalents at end of period
24
15(a)
7
8
The statement of cash flows should be read in conjunction with the accompanying notes.
21
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements
FOR THE YEAR ENDED 30 JUNE 2021
1. CORPORATE INFORMATION
The consolidated financial statements of Ariadne Australia Limited (“Ariadne”) and its controlled entities (“the Group”) for the year ended
30 June 2021 were authorised for issue in accordance with a resolution of the Directors on 30 August 2021.
Ariadne is a for profit company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities
Exchange.
A description of the Group's operations and of its principal activities is included in the Directors' Report on pages 6 to 16.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation
The consolidated financial statements include the parent entity, Ariadne, and its controlled entities. The financial report is a general-purpose
financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001 and Australian Accounting
Standards as issued by the Australian Accounting Standards Board (“AASB”).
The financial report has been prepared on a historical cost basis, except for investments in financial instruments and property assets which
have been measured at fair value.
Where necessary, comparatives have been reclassified and repositioned for consistency with current year disclosures.
The Group has also adopted all of the new and revised Standards and Interpretations issued by the AASB that are relevant and effective
for the current year. There are no new, revised Standards, amendments thereof or Interpretations effective for the current year that have
had a material impact on the Group.
In the application of the Group’s accounting policies, management is required to make judgements, estimates, and assumptions about the
carrying amounts of assets and liabilities that are not readily available or apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these
estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period
in which the estimate is revised if the revision effects only that period, or in the period of the revision and future periods if the revision
affects both current and future periods.
The outbreak of COVID-19 and the subsequent quarantine measures imposed by the Australian and other governments as well as the
travel and trade restrictions imposed by Australia and other countries in early 2020 have caused significant and widespread disruption to
businesses and economic activity in Australia. At the date of approving these financial statements, the Directors are of the view the effects
of COVID-19 do not change the significant estimates, judgements and assumptions in the preparation of the financial statements, however
COVID-19 and its associated economic impacts remain uncertain. The Directors continue to closely monitor developments with a focus
on potential financial and operational impacts and note that the situation is continuing to evolve.
(b) Compliance
The financial report also complies with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting
Standards Board.
(c) Future changes
There are no standards or Interpretations that are not yet effective and that are expected to have a material impact on the Group in the
current or future reporting periods and on foreseeable future transactions.
22
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(d) Basis of consolidation
The consolidated financial statements comprise the financial statements of Ariadne and its controlled entities. Control is achieved when
the Group;
has power over the investee;
is exposed, or has rights, to variable returns from its involvement with the investee; and
has the ability to use its power to affect its returns.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of
the three elements of control listed above.
The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting
policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist.
Subsidiaries are fully consolidated from the date on which control is obtained by the Group and cease to be consolidated from the date
on which control is transferred out of the Group. Where there is loss of control of a subsidiary, the consolidated financial statements
include the results for that part of the reporting period during which Ariadne had control.
In preparing the consolidated financial statements, all intercompany balances and transactions, income and expenses and profits and losses
resulting from intra-group transactions, have been eliminated in full.
(e) Significant judgements and estimates
Critical accounting policies for which significant judgements, estimates and assumptions are made are detailed below. Actual results may
differ from these estimates under different assumptions and conditions and may materially affect the financial result or the financial position
reported in future periods.
Details of the significant judgements and estimates made in relation to;
the accounting policies applied when assessing the recoverable amount of the Group’s assets and assets of joint ventures are
disclosed in Note 2(f), Note 2(i) and in Note 13,
the treatment of available income tax losses are disclosed in Note 5,
determining the fair value of investment property are disclosed in Note 2(h),
determining the fair value of investments are disclosed in Note 2(i) and Note 17(g).
No other significant judgements or estimates that require additional disclosure in the financial report in the process of applying the Group’s
accounting policies have been made.
Investments in joint ventures and associates
(f)
An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in the financial and
operating policy decisions of the investee but is not control or joint control over those policies.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the
joint arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about
the relevant activities require unanimous consent of the parties sharing control.
The results, assets and liabilities of associates or joint ventures are incorporated in these consolidated financial statements using the equity
method of accounting, except when the investment, or a portion thereof, is classified as held for sale, in which case it is accounted for in
accordance with AASB 5 Non-current Assets Held for Sale and Discontinued Operations.
Under the equity method, an investment in an associate or a joint venture is initially recognised in the consolidated statement of financial
position at cost and adjusted thereafter to recognise the Group's share of the profit or loss and other comprehensive income of the
associate or joint venture. When the Group's share of losses of an associate or a joint venture exceeds the Group's interest in that
associate or joint venture (which includes any long-term interests that, in substance, form part of the Group's net investment in the
associate or joint venture), the Group discontinues recognising its share of further losses. Additional losses are recognised only to the
extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate or joint venture. An
investment in an associate or a joint venture is accounted for using the equity method from the date on which the investee becomes an
associate or a joint venture.
When a group entity transacts with an associate or a joint venture of the Group, profits or losses resulting from the transactions with the
associate or joint venture are recognised in the Group’s consolidated financial statements on a gross basis. Related party transactions are
disclosed in Note 20. Unrealised gains and losses on transactions between the Group and its associates and joint ventures are eliminated
to the extent of the Group’s interest in those entities. Where unrealised losses are eliminated, the underlying asset is also tested for
impairment.
23
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(g) Foreign currency translation
Both the functional and presentation currency of Ariadne and all of its subsidiaries is Australian dollars (“AUD”).
All transactions in foreign currencies are initially recorded in the functional currency of the relevant entity at the exchange rate applicable
at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the functional currency
of the entity at the rate of exchange applicable at the Balance Sheet date.
Revenues derived and expenses incurred by entities with a functional currency other than AUD are translated into the Group’s
presentation currency using the average exchange rate applicable in the reporting period. Assets and liabilities are translated into AUD at
the rate of exchange applicable at the Balance Sheet date. All exchange differences arising on the translation into the presentation currency
of the Group are recorded in the foreign currency translation reserve.
(h) Investment properties
Investment properties are initially measured at cost, including any associated transaction costs of acquisition. Costs incurred in the day-to-
day servicing of the asset are excluded from the cost base of the asset.
Subsequent to initial recognition, investment properties are stated at fair value. Market conditions applicable to the asset at Balance Sheet
date are considered in assessing fair value. Gains or losses arising from changes in fair values are recognised in the consolidated Statement
of Profit or Loss and Other Comprehensive Income in the year in which they arise.
When investment property is transferred to development inventories, the deemed cost of the inventory is its fair value as at the date of
the change in use.
The fair value accounting for Orams Marine Village requires significant management judgement in respect of the capitalisation rate adopted
within the Capitalisation Method Valuation and the discount rate and terminal yield adopted within the Discounted Cash Flow Valuation.
(i) Recoverable amount of assets
At each reporting date, the Group assesses whether there is any indication that an asset may be impaired. Where an indicator of impairment
exists, the Group makes a formal estimate of recoverable amount. Where the carrying amount of an asset exceeds its recoverable amount
the asset is considered impaired and is written down to its recoverable amount.
Recoverable amount is the greater of fair value less costs to sell and value in use. It is determined for an individual asset, unless the
asset’s value in use cannot be estimated to be close to its fair value less costs to sell and it does not generate cash inflows that are largely
independent of those from other assets or groups of assets, in which case, the recoverable amount is determined for the cash-generating
unit to which the asset belongs.
Investments
(j)
The Group has two separate and distinct investment portfolios and designates its investments as either trading or strategic. The strategic
portfolio is further broken down into strategic portfolio revalued through profit and loss and strategic portfolio revalued through other
comprehensive income, both held for long term capital appreciation but differentiated by their accounting treatment under accounting
standard AASB 9 – Financial instruments.
Additions, for all portfolios, are initially recognised at cost, being the fair value of the consideration given and including acquisition charges
associated with the investment.
Investments within all the portfolios are remeasured to fair value based on the appropriate level inputs at the end of the reporting period.
Gains or losses on investments in the trading portfolio and the strategic portfolio revalued through profit and loss are recognised in the
Statement of Profit or Loss and Other Comprehensive Income. In contrast, gains or losses on the strategic portfolio revalued through
other comprehensive income are recognised as a separate component of equity and are not reclassified to the profit or loss on either its
disposal or on recognition of an impairment charge. The fair value of investments are determined as set out in Note 17(g).
Investments remeasured to fair value are disclosed in Note 9 and Note 11.
For investments carried at amortised cost, gains and losses are recognised in the Statement of Profit or Loss and Other Comprehensive
Income when the investments are derecognised or impaired, as well as through the amortisation process.
(k) Recognition and derecognition of financial instruments
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the financial
instrument.
Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset
and substantially all the risks and rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled
or expires.
24
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(l) Trade and other receivables
Trade receivables, which generally have 30-day terms, are recognised and carried at original invoice amount less an allowance for any
uncollectible amounts. An estimate for doubtful debts is made for expected credit losses. Bad debts are written off when identified.
(m) Cash and cash equivalents
Cash and short-term deposits in the Balance Sheet comprise cash at bank and in hand and short-term deposits which are readily convertible
to known amounts of cash and are subject to an insignificant change in value.
For the purposes of the Statement of Cash Flows, cash and cash equivalents are as defined above, net of outstanding bank overdrafts.
(n) Interest-bearing loans and borrowings
All loans and borrowings are initially recognised at cost, being the fair value of the consideration received net of issue costs associated with
the borrowing.
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective interest
method. Amortised cost is calculated by taking into account any issue costs, and any discount or premium on settlement.
Gains and losses are recognised in the Statement of Profit or Loss and Other Comprehensive Income when the liabilities are derecognised
and as well as through the amortisation process.
(o) Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an
outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the
amount of the obligation.
Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is
recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in
the Statement of Profit or Loss and Other Comprehensive Income net of any reimbursement.
If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax
rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
(p) Share-based payment transactions
The Group provides benefits to employees (including Directors) of the Group in the form of share-based payment transactions, whereby
employees render services in exchange for shares or rights over Ariadne shares (“equity-settled transactions”).
The cost of these equity-settled transactions is measured with reference to the fair value at the date at which the shares or rights over
shares are granted. Fair value is determined using a Black Scholes model.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the
performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (“vesting
date”).
The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects the extent to which
the vesting period has expired.
Previously recognised share based payment expenses are reversed in the Statement of Profit or Loss and Other Comprehensive Income
to the extent that awards do not ultimately vest.
Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the terms had not been modified.
In addition, an expense is recognised for any increase in the value of the transactions as a result of the modification, as measured at the
date of modification.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised
for the award is recognised immediately. However, if a new award is substituted for the cancelled award and designated as a replacement
award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the original award, as
described in the previous paragraph.
The dilutive effect, if any, of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.
25
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(q) Leases
The Group assesses whether a contract is or contains a lease at inception of the contract. A lease conveys the right to direct the use and
obtain substantially all of the economic benefits of an identified asset for a period of time in exchange for consideration.
Some lease contracts contain both lease and non-lease components. These non-lease components are usually associated with facilities
management services at offices and servicing and repair contracts in respect of motor vehicles. The Group has elected to not separate its
leases for offices into lease and non-lease components and instead accounts for these contracts as a single lease component. For its other
leases, the lease components are split into their lease and non-lease components based on their relative stand-alone prices.
Measurement and recognition of leases as a lessee
At lease commencement date, the Group recognises a right-of-use asset and a lease liability in its consolidated statement of financial
position. The right-of-use asset is measured at cost, which is made up of the initial measurement of the lease liability, any initial direct costs
incurred by the Group, an estimate of any costs to dismantle and remove the asset at the end of the lease, and any lease payments made
in advance of the lease commencement date (net of any incentives received).
The Group depreciates the right-of-use asset on a straight-line basis from the lease commencement date to the earlier of the end of the
useful life of the right-of-use asset or the end of the lease term. The Group also assesses the right-of-use asset for impairment when such
indicators exist.
At the commencement date, the Group measures the lease liability at the present value of the lease payments unpaid at that date,
discounted using the Group’s incremental borrowing rate because as the lease contracts are negotiated with third parties it is not possible
to determine the interest rate that is implicit in the lease. The incremental borrowing rate is the estimated rate that the Group would have
to pay to borrow the same amount over a similar term, and with similar security to obtain an asset of equivalent value. This rate is adjusted
should the lessee entity have a different risk profile to that of the Group.
Lease payments included in the measurement of the lease liability are made up of fixed payments (including in substance fixed), variable
payments based on an index or rate, amounts expected to be payable under a residual value guarantee and payments arising from options
reasonably certain to be exercised.
Subsequent to initial measurement, the liability will be reduced by lease payments that are allocated between repayments of principal and
finance costs. The finance cost is the amount that produces a constant periodic rate of interest on the remaining balance of the lease
liability.
The lease liability is reassessed when there is a change in the lease payments. Changes in lease payments arising from a change in the lease
term or a change in the assessment of an option to purchase a leased asset. The revised lease payments are discounted using the Group’s
incremental borrowing rate at the date of reassessment when the rate implicit in the lease cannot be readily determined. The amount of
the remeasurement of the lease liability is reflected as an adjustment to the carrying amount of the right-of-use asset. The exception being
when the carrying amount of the right-of-use asset has been reduced to zero then any excess is recognised in profit or loss.
Payments under leases can also change when there is either a change in the amounts expected to be paid under residual value guarantees
or when future payments change through an index or a rate used to determine those payments, including changes in market rental rates
following a market rent review. The lease liability is remeasured only when the adjustment to lease payments takes effect and the revised
contractual payments for the remainder of the lease term are discounted using an unchanged discount rate. Except for where the change
in lease payments results from a change in floating interest rates, in which case the discount rate is amended to reflect the change in interest
rates.
(r) Revenue
Revenue is recognised at an amount that reflects the consideration for which the Group is expecting to be entitled for transferring goods
or services. The following specific recognition criteria must also be met before revenue is recognised:
Rental income
Rental income, which includes car parking and marina revenue, is recognised at transfer of service, which is generally at the time of delivery.
Interest income
Revenue is recognised as the interest accrues using the effective interest method (which is the rate that exactly discounts estimated future
cash receipts through the expected life of the financial instrument to the net carrying amount of the financial asset).
Dividend income
Revenue is recognised when the shareholder’s right to receive the payment is established.
Rendering of services
Revenue from the rendering of services is recognised at amounts which reflect the transfer of those services to the customer.
26
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(s) Employee benefits
Provision is made for employee benefits accumulated as a result of employees rendering services up to the reporting date. These benefits
include salaries/wages and on costs, leave provisions, superannuation and share based payments.
Liabilities arising in respect of wages and salaries, annual leave, and any other employee benefits expected to be settled within twelve
months of the reporting date are measured at their nominal amounts based on remuneration rates which are expected to be paid when
the liability is settled. All other employee benefit liabilities are measured at the present value of the estimated future cash outflow to be
made in respect of services provided by employees up to the reporting date. In determining the present value of future cash outflows, the
market yield as at the reporting date on national government bonds, which have terms to maturity approximating the terms of the related
liability, are used.
Employee benefit expenses and revenues arising in respect of the following categories:
wages and salaries, non-monetary benefits, annual leave, long service leave, and other leave benefits; and
other types of employee benefits
are recognised against profits on a net basis in their respective categories.
(t) Income tax
The current income tax charge is calculated on the basis of the tax laws enacted or substantially enacted at the end of the reporting period
in the countries where the company and its subsidiaries and associates operate and generate taxable income. Management periodically
evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and considers
whether it is probable that a taxation authority will accept an uncertain tax treatment. The group measure its tax balances either based on
the most likely amount of the expected value, depending on which method provides a better prediction of the resolution of the uncertainty.
Deferred income tax is provided on all taxable temporary differences at the Balance Sheet date between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax liabilities are recognised for all taxable temporary differences:
except where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not
a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and
in respect of taxable temporary differences associated with investments in subsidiaries and interests in joint ventures, except
where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences
will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, including unused tax losses, to the extent that it is
probable taxable profit will be available against which the deductible temporary differences, and the carry-forward tax losses can be utilised:
except where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of
an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; and
in respect of deductible temporary differences associated with investments in subsidiaries, interests in joint ventures, deferred tax
assets are only recognised to the extent that it is probable that the temporary differences will reverse in the foreseeable future
and taxable profit will be available against which the temporary differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each Balance Sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised
or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.
Income taxes relating to items recognised directly in equity are recognised in equity and not in the Statement of Profit or Loss and Other
Comprehensive Income.
(u) Other taxes
Revenues, expenses and assets are recognised net of the amount of GST except:
where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the
GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the Balance
Sheet.
Cash flows are included in the Cash Flow Statement on a gross basis and the GST component of cash flows arising from investing and
financing activities, which is recoverable from, or payable to, the taxation authority are classified as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation authority.
27
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(v) Earnings per share (“EPS”)
Basic EPS is calculated as net profit attributable to members, adjusted to exclude costs of servicing equity (other than dividends), divided
by the weighted average number of ordinary shares. Diluted EPS is calculated as net profit attributable to members, adjusted for
costs of servicing equity (other than dividends) and preference share dividends; and
other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential
ordinary shares;
divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element.
(w) Land and buildings
Land and buildings held for use in the production or supply of goods or services for rental to others (excluding investment properties), or
for administrative purposes, are stated in the statement of financial position at their revalued amounts, being the fair value at the date of
revaluation, less any accumulated depreciation and accumulated impairment losses. Depreciation for land and water right-of-use assets is
recognised on a straight-line basis over 125 years to write down the cost less estimated residual value. Revaluations are performed with
sufficient regularity such that the carrying amount does not differ materially from that which would be determined using fair values at the
reporting date. Any revaluation increase arising on the revaluation of such land and buildings is credited to the property asset revaluation
reserve, except to the extent that it reverses a revaluation decrease for the same asset previously recognised as an expense, in which case
the increase is credited to profit or loss to the extent of the decrease previously expensed. A decrease in carrying amount arising on the
revaluation of such land and buildings is charged as an expense to the extent that it exceeds the balance, if any, held in the property asset
revaluation reserve relating to a previous revaluation of that asset.
(x) Correction to prior period
One of the Group’s associates, Orams Group Limited (“Orams”) undertook a review of the movements recorded for its property assets
during the period and found that the associated deferred tax expense, applicable to the movements, had been applied incorrectly. This
error has been rectified by restating each of the affected financial statement line items for prior periods as follows:
Statement of Profit and Loss and Other Comprehensive Income
(extract)
For the period to 30 June 2020
Previous
Amount
$’000
Adjustment
Restated Amount
$’000
$’000
OTHER COMPREHENSIVE INCOME
Items that may be reclassified subsequently to profit or loss
Net fair value movement of property assets, net of tax
OTHER COMPREHENSIVE INCOME FOR THE PERIOD
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD
Attributable to:
Non-controlling interests
MEMBERS OF ARIADNE
Balance Sheet (extract)
For the period ended 30 June 2020
ASSETS
Non-Current Assets
Investments in joint ventures and associates
Total Non-Current Assets
TOTAL ASSETS
NET ASSETS
EQUITY
Reserves
EQUITY ATTRIBUTABLE TO MEMBERS
Non-controlling interests
TOTAL EQUITY
11,009
(17,946)
(24,781)
429
(25,210)
Previous
Amount
39,036
86,804
130,068
121,597
143,274
115,386
6,211
121,597
(3,119)
(3,119)
7,890
(21,065)
(3,119)
(27,900)
—
(3,119)
429
(28,329)
Adjustment
Restated Amount
(3,119)
(3,119)
(3,119)
(3,119)
(3,119)
(3,119)
—
(3,119)
35,917
83,685
126,949
118,478
140,155
112,267
6,211
118,478
There was no impact to FY20 EPS, as disclosed in the statement of profit or loss and other comprehensive income, as the calculation of
EPS does not include other comprehensive income.
28
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
(y) Business Combinations
Acquisitions of businesses are accounted for using the acquisition method. The cost of the business combination is measured as the
aggregate of the fair values (at the date of exchange) of assets given, liabilities incurred or assumed, and equity instruments issued by the
Group in exchange for control of the acquiree. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions
for recognition under AASB 3 Business Combinations are recognised at their fair values at the acquisition date, except for non-current
assets (or disposal groups) that are classified as held for sale in accordance with AASB 5 Non-current Assets Held for Sale and Discontinued
Operations, which are recognised and measured at fair value less costs to sell. Any acquisition related costs are accounted for separately
from the business combination and recognised as an expense in profit or loss as incurred.
If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity interest in the
acquiree is remeasured to fair value at the acquisition date through profit or loss.
Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business
combination over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised. If, after
reassessment, the Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities exceeds the
cost of the business combination, the excess is recognised immediately in profit or loss.
The interest of minority shareholders in the acquiree is initially measured at fair value or at the non-controlling interests’ proportion of
the net fair value of the assets, liabilities and contingent liabilities recognised.
Non-controlling interests in the net assets (excluding goodwill) of consolidated controlled entities are identified separately from the
Group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination
valued under the cost method and the non-controlling interests’ share of changes in equity since the date of the combination. Losses
applicable to the non-controlling interest in excess of the non-controlling interest’s interest in the controlled entities’ equity are allocated
against the interests of the Group except to the extent that the non-controlling interest has a binding obligation and is able to make an
additional investment to cover the losses.
3. SEGMENT INFORMATION
Segment accounting policies
An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses,
whose operating results are regularly reviewed by the entity’s chief operating decision maker. The Group’s operating segments are
identified by internal reporting used by the Board in assessing performance and determining investment strategy. The operating segments
are based on a combination of the type and nature of products sold and/or services provided, and the type of business activity. Discrete
financial information about each of these operating divisions is reported to the Board on a regular basis.
Reportable segments are based on aggregated operating segments determined by the similarity of the products sold and/or the services
provided, and the type of business activity as these are the sources of the Group’s major risks. Operating segments are aggregated into
one reportable segment when they meet the qualitative and quantitative requirements for aggregation as prescribed by AASB 8 Operating
Segments.
Segment products and locations
The Group’s reportable segments are investments, car parking and property. The investments division comprises the Group’s investments
in securities. The car parking division includes gross revenues and expenses from car park leases owned by the Group up to the date of
termination or surrender. The property division includes all results derived from property and marina assets held by the Group, either
directly or through joint venture entities or joint venture operations.
The consolidated entity’s operations are located in Australasia.
29
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Notes to Financial Statements (Continued)
202 1 A N N U A L R E P O R T
FOR THE YEAR ENDED 30 JUNE 2021
4. REVENUES AND EXPENSES
Revenue and Expenses from Continuing Operations
(a) Dividend income
Received from trading portfolio
Received from strategic portfolio
GROUP
Notes
2021
$’000
2020
$’000
347
54
401
(47)
300
232
485
347
—
347
1,003
—
1,173
2,176
(b) Other income, gain and losses
Net fair value movement of the strategic portfolio through profit or loss
Net gain on divestment of equity accounted investments
Other income
11
Investments in the strategic portfolio revalued through profit or loss, are remeasured to fair value based on the appropriate level inputs at
the end of the reporting period as outlined in Note 2(j). The carrying values of the strategic portfolio is disclosed in Note 11.
(c) Employee benefits expense
Salaries, wages and on costs
Leave provisions
Superannuation
Share-based payment expense
(d) Depreciation and amortisation
Plant and equipment depreciation
Right of use asset amortisation
2,058
68
137
4
2,267
242
344
586
2,361
(105)
143
35
2,434
242
7,957
8,199
31
A R I A D N E A U S T R A L I A L I M I T E D
Notes to Financial Statements (Continued)
202 1 A N N U A L R E P O R T
FOR THE YEAR ENDED 30 JUNE 2021
5. INCOME TAX
(a) Income tax expense reconciliation
A reconciliation between income tax expense and accounting profit before income
tax multiplied by the Group’s applicable income tax rate is as follows:
Notes
Group accounting profit / (loss) after tax reported in the Statement of Profit or Loss and OCI
Income tax expense reported in the Statement of Profit or Loss and OCI
Group accounting profit / (loss) before income tax
At the Group’s statutory income tax rate of 26.0% (2020: 27.5%)
Permanent differences
Other movements
Tax losses (utilised) / carried forward
Income tax expense reported in the Statement of Profit or Loss and OCI
(b) Deferred tax balances
GROUP
2021
$’000
2020
$’000
10,572
—
10,572
2,749
(1,866)
305
(1,188)
—
(7,142)
—
(7,142)
(1,964)
(60)
899
1,125
—
Ariadne and its wholly owned Australian resident subsidiaries are part of a tax consolidated group. Ariadne, the head company, currently
has significant carried forward income and capital tax losses that are available to offset future taxable profits. At 30 June 2021, these are
estimated at $80,378 (2020: $83,940) and $72,292 (2020: $70,599) respectively. The value attributable to these tax losses have not been
recognised as an asset on the Balance Sheet.
In accordance with the Group’s accounting policy for income tax, an assessment was undertaken to estimate the probable recoverability
and sufficiency of the Group’s deferred tax assets. The assessment determined that no deferred tax asset would be recorded on the
Group’s Balance Sheet at 30 June 2021 (2020: nil).
A deferred tax asset for the revenue tax losses carried by the Group has not been recognised at reporting date, as realisation of the benefit
is not regarded as probable. The unrecognised value of the Group’s deferred tax asset relating to revenue tax losses is set out in the table
below. The value of the deferred tax asset relating to revenue tax losses will only be realised if:
(a) future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised; and
(b) the conditions for deductibility imposed by tax legislation continue to be complied with; and
(c) no changes in tax legislation adversely affect the consolidated entity in realising the benefit.
The Board has concluded that there is insufficient evidence to estimate future capital gains and losses other than those non-current assets
which are carried at fair value under accounting standards. As such, no deferred tax asset of has been recognised at balance date (2020:
nil), The unrecognised value of the Group’s deferred tax asset relating to revenue tax losses is set out in the table below.
Unrecognised deferred tax assets comprises:
Tax losses - revenue
Tax losses - capital
Net deferred tax asset unrecognised
20,898
18,796
39,694
23,083
19,415
42,498
32
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
6. EARNINGS PER SHARE
Basic EPS amounts are calculated by dividing net profit for the year attributable to ordinary equity holders of Ariadne by the weighted
average number of ordinary shares outstanding during the year as outlined in Note 2(v).
Diluted EPS amounts are calculated by dividing the net profit attributable to ordinary equity holders of the parent by the weighted average
number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on the
conversion of all the dilutive potential ordinary shares into ordinary shares.
Earnings and share data used in the calculations of basic and diluted earnings per share:
Net profit / (loss) attributable to members ($’000)
Earnings used in calculating basic and diluted EPS ($’000)
Total comprehensive income attributable to members ($’000)
Total comprehensive earnings used in calculating basic and diluted EPS ($’000)
Weighted average number of ordinary shares used in calculating basic EPS
Effect of dilutive securities:
Employee share options
Weighted average number of ordinary shares used in calculating diluted EPS
Basic EPS (cents per share)
Diluted EPS (cents per share)
Total comprehensive EPS (cents per share)
Total comprehensive diluted EPS (cents per share)
ARIADNE
2021
2020
10,572
10,572
36,678
36,678
(7,142)
(7,142)
(28,329)
(28,329)
196,242,360
196,429,922
—
196,242,360
500,000
196,929,922
5.39
5.39
18.69
18.69
(3.64)
(3.63)
(14.42)
(14.39)
7. DIVIDENDS PAID AND PROPOSED ON ORDINARY SHARES
The Directors have declared a partially franked (40%) final dividend of $981 (0.5 cents per share) in relation to the 2021 financial
year, of which 60% is sourced from the Conduit Foreign Income Account. As the final dividend for 2021 was declared after balance
date, no liability was recognised at balance date. The FY20 interim dividend of $1,374 (0.7 cents per share) declared in February 2020
and deferred in March 2020, was paid on 24 September 2020.
Franking Account
The amount of franking credits available for distribution from the franking account at year end was $456 (2020: $649). The final dividend
for 2021 is 40% franked.
Conduit Foreign Income Account
For the 2021 final dividend, 60% of the dividend is sourced from Ariadne’s Conduit Foreign Income Account. As a result, 60% of the final
dividend paid to a non-resident shareholder will not be subject to Australian withholding tax.
33
A R I A D N E A U S T R A L I A L I M I T E D
Notes to Financial Statements (Continued)
202 1 A N N U A L R E P O R T
FOR THE YEAR ENDED 30 JUNE 2021
8. CASH AND CASH EQUIVALENTS
Cash at call
Cash on term deposit
GROUP
Notes
2021
$’000
2020
$’000
28,629
—
28,629
8,448
—
8,448
24,916
10,000
34,916
3,908
1,874
5,782
9. FINANCIAL ASSETS (CURRENT)
Trading portfolio
Strategic portfolio revalued through profit or loss
(i)
(i, ii)
(i)
(ii)
Investments in the trading portfolio and strategic portfolio revalued through profit or loss, are remeasured to fair value based on the appropriate
level inputs at the end of the reporting period as outlined in Note 2(j). The fair value movement of these portfolios are disclosed in Note 4(b).
Securities included in current assets were reclassified as financial assets fair valued through other comprehensive income during the period, refer to
Note 11.
10. RECEIVABLES (NON-CURRENT)
Related entity loans and advances
Other loans and advances
The loans to related entities are directly supported by the assets of the borrower.
11. FINANCIAL ASSETS (NON-CURRENT)
Cost
Accumulated fair value adjustments
Net carrying amount
Reconciliations for listed strategic investments
Opening balance
Additions
Reclassified securities
Fair value adjustments through other comprehensive income
Disposals
Net carrying amount of listed investments
Reconciliations for unlisted strategic investments
Opening balance
Additions
Reclassified securities
Fair value adjustments through profit or loss
Fair value adjustments through other comprehensive income
Disposals
Net carrying amount of unlisted investments
20
14,463
4,529
18,992
10,932
5,827
16,759
85,223
(19,468)
65,755
18,223
1,544
14,232
15,342
—
49,341
12,026
1,539
1,874
(47)
1,022
—
16,414
69,909
(39,660)
30,249
46,431
185
—
(26,011)
(2,382)
18,223
11,734
3,052
—
128
(2,888)
—
12,026
(i)
(ii)
(iii)
(i)
(ii)
(ii)
(i)
(ii)
Securities reclassified as financial assets fair valued through other comprehensive income, refer to Notes 9 and 13.
Investments in the strategic portfolio are remeasured to fair value based on the appropriate level inputs at the end of the reporting period as
outlined in Note 2(j).
(iii) Material additions during the period include investments associated with King River Capital Management Pty Ltd.
34
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
12. CONTROLLED ENTITIES
Place of
incorporation
Percentage of equity held by
Ariadne
NAME
Ariadne Administration Pty Ltd
Ariadne Capital Pty Ltd
Ariadne Financial Services Pty Ltd (previously Ariadne Insurance Pty Ltd)
Ariadne Freehold Pty Ltd
Ariadne Holdings Pty Ltd
Ariadne Investment Holdings Pty Ltd
Ariadne Marinas Oceania Pty Ltd
Ariadne Properties Pty Ltd
Delta Equities Pty Ltd
Freshxtend International Pty Ltd
Orams NZ Unit Trust ^
Portfolio Services Pty Ltd
QLD
QLD
NSW
NSW
ACT
QLD
QLD
QLD
NSW
QLD
QLD
QLD
2021
100
100
100
100
100
100
100
100
100
53
80
100
Entities deregistered during the reporting period
Kings Parking Corporate Pty Ltd
QLD
—
^ Orams NZ Unit Trust became a controlled entity during the period, refer to Note 13(c).
13. INVESTMENTS IN JOINT VENTURES AND ASSOCIATES
(a) Details of the Group’s investment in joint ventures and associates
2020
100
100
100
100
100
100
100
100
100
53
50
100
100
Place of
incorporation
Proportion of ownership
interest and voting power held
by the Group
Name
Principal activity
Lake Gold Pty Ltd
Kippax Property Trust
AgriCoat NatureSeal Limited
NatureSeal Inc
Mineral exploration
Property investment
Food life extension technology
Food life extension technology
Entities reclassified or established during the reporting period
Hillgrove Resources Limited
Orams NZ Unit Trust
Orams Group Limited
Orams Residential Limited
Mining exploration
Holding Trust
Marina management
Residential development
AUS
AUS
UK
US
AUS
AUS
NZ
NZ
2021
50%
50%
17%
17%
19%
Refer to Note 12
76%
76%
Entities deregistered during the reporting period
Chifley Investment Partners Trust 1
Investment management
AUS
—
Hillgrove Resources Limited (“Hillgrove”)
During December 2020 and February 2021 Hillgrove raised a total of $10,900 via an institutional placement and entitlement rights
offer. Ariadne subscribed for $475 and $600 respectively reducing its interest in Hillgrove to 19.52%. On 6 May 2021, Ariadne sold
shares in Hillgrove reducing its interest further to 18.99%. The change in relevant interest below the ‘key’ 20% threshold and the
subsequent sale of shares, resulted in management assessing that the Group’s investment in Hillgrove no longer met the threshold of
an ‘Associate’ under AASB 128 Investments in Associates and Joint Ventures. The interest was reclassified as an investment part of the
‘strategic portfolio’ and accounted for a listed security under AASB 9 Financial Instruments where mark-to-market changes in fair value
are recorded through Other Comprehensive Income. Refer to Notes 11 and 13(b). A mark-to-market gain of $8,979 was recorded
through the profit and loss on reclassification.
Orams NZ Unit Trust (“ONZUT”), Orams Group Limited (“Orams”) and Orams Residential Limited (“ORL”)
During the period ONZUT became a controlled entity of the Group with its results consolidated by the Group from 14 July 2020, refer
to Note 24. Orams became an associate of the Group on the consolidation of ONZUT, refer to Note 13(c). ORL was established
during the period and is owned, in the same proportions, as the shareholders of Orams, refer to Note 13(c).
35
A R I A D N E A U S T R A L I A L I M I T E D
2020
50%
50%
17%
17%
25%
50%
—
—
50%
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
13. INVESTMENTS IN JOINT VENTURES AND ASSOCIATES (Continued)
(b) Aggregate information of joint ventures and associates
GROUP
Notes
2021
$’000
2020
$’000
Balance at the beginning of the reporting period
Share of joint ventures’ and associates’ profits / (losses)
Share of joint ventures’ and associates’ reserves
Net investment in / (divestment of) joint ventures and associates
Joint ventures and associates included via the additional acquisition in ONZUT
Joint ventures and associates reclassified as subsidiary on business combination
Joint ventures and associates reclassified as securities
Distributions received from joint ventures and associates
24
24
13(a)
Carrying amount of investment in joint ventures and associates at reporting period end
35,917
5,068
11,798
801
54,717
(16,593)
(5,253)
(1,608)
84,846
32,816
(4,488)
7,928
1,151
—
—
—
(1,490)
35,917
The Group’s share of joint ventures’ and associates’ commitments and contingent liabilities is disclosed in Note 18.
(c) Summary financial information of material joint ventures and associates
Control of ONZUT
On 14 July 2020, Ariadne announced that all approvals and necessary consents had been received and that the additional 30% interest had
been transferred to Ariadne, increasing its interest in the ONZUT to 80% and its indirect holding in Orams Group Limited to 61%. ONZUT
became a controlled entity and subsidiary of Ariadne, with its results consolidated by Ariadne from 14 July 2020. Refer to Note 24 for further
details.
Orams becomes an associate
On 14 July 2020, Orams became an associate of the Group following the control of ONZUT. Although ONZUT owns 76% of the equity and
voting interest in Orams, the Shareholders Agreement requires that the two majority shareholders must act together to direct the relevant
activities of the company, therefore no individual shareholder has control. ORL has an equivalent Shareholders’ Agreement.
Orams is the owner of Orams Marine Village and Orams Marine Services, New Zealand’s premier marine facility and largest marine
maintenance and refit services business respectively and is developing a new state-of-the-art marine refit facility on its existing site and an
adjoining property known as Site 18 in downtown, Auckland’s Wynyard quarter. This will treble Orams Marine Services’ current capacity
for marine maintenance and refit business. The marine works completed include, remediation of the new marine area including a groundwater
cut-off wall, strengthening of the seawall, a concrete fibre reinforced hardstand area providing marine haul out space and installation of new
travel lift piers – all on time and within budget. New 820 and 85 tonne travel lifts were commissioned and have been operational since January
2021. In addition to the works completed, the three-stage development will feature a refit facility, commercial buildings and a residential
component on the northern end of Site 18 which was transferred to ORL during the period. The facility will target marine vessels (including
superyachts) up to 800 tonnes. The development will also provide increased maintenance facilities for Auckland’s ferries, fishing vessels and
commercial vessels.
Financial metrics for Orams
Revenue
Interest expense
Depreciation
Income tax
Profit
Share of profit at 76%
Other comprehensive income
Share of other comprehensive income at 76%
Cash and cash equivalents
Current assets
Total assets
Current liabilities
Non-current financial liabilities
Total liabilities
Net assets
Share of net assets at 76%
36
A R I A D N E A U S T R A L I A L I M I T E D
2021
Notes
NZ$’000
2020
NZ$’000
21,415
(886)
(1,151)
(2,947)
7,462
5,667
18,148
13,783
4,307
50,151
214,305
(11,218)
(83,863)
(111,586)
102,719
78,015
17,967
(266)
(618)
1,200
(3,087)
2,345
22,604
17,168
1,451
3,497
166,539
(26,220)
(63,824)
(89,430)
77,109
58,564
Notes to Financial Statements (Continued)
202 1 A N N U A L R E P O R T
FOR THE YEAR ENDED 30 JUNE 2021
14. LOANS AND BORROWINGS
Current
Non-interest bearing facilities
Interest bearing facilities
NZ-dollar interest bearing facilities
Non-current
NZ-dollar interest bearing facilities
Notes
(i)
(ii)
(iii)
(iii)
GROUP
2021
$’000
2020
$’000
6,500
7,150
1,396
15,046
13,960
13,960
—
5,450
—
5,450
—
—
Total loans and borrowings
29,006
5,450
(i) The Group received a non-interest-bearing loan of $6,500 from an entity associated with the Deputy Chairman, Mr Kevin Seymour during the
period, see also Note 20.
(ii) The Group drew down $1,700 (2020: $950) from its bank loan facility during the period, reducing the Group’s unused and available loan facility to
$2,546 (2020: $4,296) as summarised in the table below. The 12-month rolling facility is a variable interest rate facility that averaged 2.5% during the
period. Ariadne has provided a guarantee for this finance facility, refer to Note 18(c).
(iii) During the period ONZUT became a controlled entity and subsidiary of Ariadne, with its assets and liabilities consolidated by Ariadne. ONZUT had
a NZ$18,000 loan facility at the date of control. NZ$1,500 was repaid during the period, leaving a balance of NZ$16,500 at period end. The 24-
month facility, ending May 2022, is a variable interest rate facility that averaged 4.3% during the period. Ariadne has provided a guarantee on behalf of
ONZUT for this finance facility, refer to Note 18(c).
Financing facilities available
Total facilities
Bank loan facilities
Other facilities
Other facilities not recorded on the Group’s Balance Sheet
Facilities used at reporting date
Bank loan facilities
Other facilities
Other facilities not recorded on the Group’s Balance Sheet
Facilities unused at reporting date
Bank loan facilities
Other facilities
Other facilities not recorded on the Group’s Balance Sheet
15. CONTRIBUTED EQUITY AND RESERVES
(a) Ordinary Ariadne shares on issue
25,052
6,500
304
22,506
6,500
304
2,546
—
—
9,746
—
304
5,450
—
304
4,296
—
—
At beginning of the reporting period
Shares bought back
Balance at reporting period end
2021
2020
Note
Number of
shares
$’000
196,242,360
—
196,242,360
378,156
—
378,156
Number of
shares
196,892,360
(650,000)
196,242,360
$’000
378,558
(402)
378,156
On 19 February 2021, as part of ongoing capital management initiatives, Ariadne extended its on-market buy-back facility, allowing up to
10% of its capital to be repurchased, for a further twelve months. The buy-back is for the purpose of acquiring shares where they are
trading at prices below the Board’s opinion of the intrinsic value of the shares, such acquisitions benefiting all shareholders. Ordinary shares
entitle their holder to one vote, either in person or by proxy, at a meeting of Ariadne.
37
A R I A D N E A U S T R A L I A L I M I T E D
Notes to Financial Statements (Continued)
202 1 A N N U A L R E P O R T
FOR THE YEAR ENDED 30 JUNE 2021
15. CONTRIBUTED EQUITY AND RESERVES (Continued)
(b) Share Options
Employee options over Ariadne ordinary shares
At beginning of the reporting period
Employee share options issued
Employee share options expired
Employee share options exercised
Balance at reporting period end
ARIADNE
2021
2020
Number of
options
Number of
options
1,500,000
—
500,000
—
1,000,000
1,500,000
—
—
—
1,500,000
Each option entitles the holder to purchase one ordinary share. Further details of the terms and conditions of the options are set out in
the Remuneration Report.
(c) Reserves
At 1 July 2019
Current year profits to profit reserve
Movements through OCI, net of tax
Movements within reserves
Cost of share-based payment
Dividends
At 30 June 2020
Current year profits to profit reserve
Movements through OCI, net of tax
Movements within reserves
Transfer of reserves to accum. losses
Cost of share-based payment
At 30 June 2021
Nature and purpose of reserves
Financial
asset
revaluation
reserve
Property
asset
revaluation
reserve
Cash
flow
hedge
reserve
Foreign
currency
translation
reserve
Share
options
reserve
$’000
129
—
—
—
35
—
$’000
(9,672)
—
(28,899)
(1,217)
—
—
$’000
—
—
7,890
—
—
—
164
(39,788)
7,890
—
—
—
(41)
4
—
16,364
—
—
—
—
10,330
(8,030)
—
—
127
(23,424)
10,190
Profits
reserve
$’000
101,038
968
—
—
—
(3,341)
Capital
profits
reserve
$’000
70,022
—
—
1,217
—
—
ARIADNE
$’000
163,680
968
(21,187)
—
35
(3,341)
$’000
2,157
—
(172)
—
—
—
1,985
98,665
71,239 140,155
—
(588)
(27)
—
—
16,319
—
27
—
—
—
—
8,030
—
—
16,319
26,106
—
(41)
4
1,370 115,011
79,269 182,543
$’000
6
—
(6)
—
—
—
—
—
—
—
—
—
—
Share options reserve
The share options reserve records the value of equity benefits outstanding, provided to employees and Directors as part of their
remuneration.
Property asset revaluation reserve
The property asset revaluation reserve records the Group’s share of joint ventures’ and associates’ movements in the fair value of property
assets net of tax as recognised in other comprehensive income.
Financial asset revaluation reserve
The financial asset revaluation reserve records the Group’s share of movements in the fair value of the strategic portfolio net of tax as
recognised in other comprehensive income.
Cash flow hedge reserve
The cash flow hedge reserve records the Group’s share of movements in the fair value of effective hedging instruments against hedged
risks as recognised in other comprehensive income.
Foreign currency translation reserve
The foreign currency translation reserve records exchange differences arising from the translation of the financial statements of foreign
subsidiaries, joint ventures and associates with a non-Australian dollar functional currency as recognised in other comprehensive income.
38
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
15. CONTRIBUTED EQUITY AND RESERVES (Continued)
(c) Reserves (Continued)
Profit reserve
The profit reserve is used to accumulate distributable profits, preserving the characteristics of profit by not appropriating against prior year
accumulated losses. The reserve can be used to pay taxable dividends.
The 30 June 2021 amount carried to profits reserve (in accordance with director resolutions) of $16,319 (2020: $968) includes an amount
of $16,319 (2020: $503) relating to subsidiary entities and is not available for distribution as frankable dividends to the equity holders of
Ariadne at 30 June 2021.
Capital profits reserve
The capital profits reserve is used to accumulate realised capital profits. The reserve can be used to pay dividends or issue bonus shares.
$8,030 (2020: $1,217) was carried to capital profits reserve during the period.
(d) Accumulated losses
Opening balance
Net loss not carried to profit reserve
Closing balance
Notes
GROUP
2021
$’000
(406,044)
(5,706)
(411,750)
2020
$’000
(397,934)
(8,110)
(406,044)
16. CASH FLOW STATEMENT RECONCILIATION
Reconciliation of the net profit / (loss) after tax to the net cash flows from operations
Net profit / (loss) after tax
11,534
(6,835)
Adjustments for:
Share options expense
Amortisation of right of use assets
Depreciation of non-current assets
Impairments
Share of joint ventures’ and associates’ (profits) / losses
Distributions received from joint ventures and associates
Net gain on equity accounted investments reclassified as securities
Fair value loss on financial liability
Transfers to / (from) provisions:
Lease liabilities
Employee entitlements
Changes in assets and liabilities:
(Increase) / decrease in trade and other receivables
(Increase) / decrease in trading portfolios
(Increase) / decrease in strategic portfolio revalued through profit or loss
(Increase) / decrease in prepayments
(Decrease) / increase in payables and accruals
Effects of exchange rate changes on cash held in foreign currencies
Net cash from operating activities
4(c)
18(a)
13(b)
13(b)
13(a)
24(i)
4(c)
4(b)
39
A R I A D N E A U S T R A L I A L I M I T E D
4
344
242
(128)
(5,068)
1,608
(8,979)
4,631
—
68
387
(4,539)
47
(18)
(1,085)
(36)
(988)
35
7,957
242
471
4,488
1,490
—
—
(55)
(105)
(1,072)
1,181
(1,003)
112
395
(12)
7,289
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
17. FINANCIAL INSTRUMENTS
(a) Financial risk management objectives and policies
The Group’s principal financial instruments include cash and short-term deposits, bank loans and receivables. These financial instruments
are maintained to ensure the Group’s operations are appropriately and efficiently financed through a combination of debt and equity, and
to enable future investment activities to be undertaken in accordance with the strategic directives of management and the Board.
The Group also has a number of other financial assets and liabilities, such as trade receivables and trade payables. These arise directly from
operating activities and comprise working capital balances.
The main risks arising from the Group’s financial instruments are price risk and credit risk. The Group’s price risk and credit risk policies
are included in Note 17(d) and Note 17(e) below. Policies for managing these risks are issued by the Board.
Details of the significant accounting policies and methods adopted, including criteria for recognition, the basis for measurement and the
basis on which income and expenses are recognised, in respect of each class of financial asset, financial liability and equity instrument are
disclosed in Note 2.
(b) Interest rate risk
The Group’s exposure to the risk of changes in interest rates primarily affects cash on deposit, loans and receivables. The Group’s policy
with respect to controlling this risk is to utilise a mix of fixed and variable deposits with terms matched to known cash flows, taking into
consideration rates offered at various financial institutions. Reviews of cash deposits, future cash needs and rates offered on various financial
products take place regularly. Consideration is given to potential renewals of existing positions, alternative products and investment
options, substitute financing arrangements, alternative hedging positions, terms of deposits/borrowings and interest rate exposure. Where
appropriate, fixed rate interest instruments are negotiated to mitigate any significant rate movement.
At balance date, the Group had the following mix of financial assets and liabilities exposed to Australian variable interest rate risk:
Financial Assets
Cash and cash equivalents
Related party loans
Total financial assets exposed to interest rate risk
Financial Liabilities
Advanced facilities and commercial bills
Total financial liabilities exposed to interest rate risk
Net exposure
GROUP
2021
$’000
2020
$’000
28,629
14,463
43,092
22,506
22,506
20,586
34,916
9,102
44,018
5,450
5,450
38,568
The following sensitivity analysis is based on the interest rate risk exposures in existence throughout the period. If interest rates had been
higher or lower as illustrated in the table below, with all other variables held constant, post tax profit would have been affected as follows
(there would be no other effect on equity):
Group
+1% (100 basis points)
- 1% (100 basis points)
Post tax profit
higher / (lower)
187
(187)
424
(424)
The movement in profit is due to higher / lower interest rates from variable rate cash deposits, receivables and debt.
The estimated effect on Group profit that would arise as a result of a change to variable rates as disclosed above reflects the net cash
position of the Group throughout the year.
40
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
17. FINANCIAL INSTRUMENTS (Continued)
(c) Foreign currency risk
As at 30 June 2021, the Group did not have any significant exposure to movements in foreign exchange rates on any of its financial
instruments.
The Group holds material investments in joint ventures and associates that are located in foreign currency jurisdictions where the Group’s
share of results denominated in foreign currencies are translated to Australian Dollars. At reporting date, the exposure to joint ventures
and associates reporting in a foreign currency was $84,145 (2020: $13,014). If the foreign exchange rates of investments in foreign joint
ventures and associates had been 10% higher or lower at balance date, the Group would be impacted through equity by $8,415 higher or
lower (2020: $1,301).
Throughout the year the Group conducted business with international associates and suppliers involving transactions in foreign currencies.
The Group’s exposure to movements in exchange rates is minimal due to the small number, size and nature of these operational
transactions.
(d) Price risk
The Group may at times be exposed to price risk arising from holding listed securities. Listed securities are held for both strategic and
trading purposes. All non-equity accounted listed securities are remeasured to fair values using Level 1 inputs as determined by reference
to the quoted market close price at balance date.
At reporting date, the exposure to non-equity accounted listed securities was $57,789 (2020: $22,131). If the price of non-equity accounted
listed securities had been 10% higher or lower at balance date, the Group would be impacted through income or equity by $5,779 higher
or lower (2020: $2,213).
(e) Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual
obligations, and arises principally from the Group’s receivables and cash on deposit.
Management has credit policies in place and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed
on all counterparties and customers requiring material credit amounts. Credit risk is spread across counterparties when possible, and
where appropriate collateral and other guarantees in respect of financial assets are required.
The maximum exposure to credit risk is represented by the carrying amount of each financial asset in the Balance Sheet.
There are no receivables as at the reporting date that management considered unlikely to be recoverable and no material receivables are
past due that have not already been provided for in Note 10.
(f) Liquidity risk
The Group manages liquidity risk by maintaining adequate cash reserves and banking facilities. Forecast and actual cash flows are
continuously monitored with the maturity profiles of the majority of financial assets and liabilities matched.
The liquidity analysis below has been determined based on contracted maturity dates and circumstances existing at reporting date. The
expected timing of actual cash flows from these financial instruments may differ.
Financial liabilities due within
6 months or less
$’000
6 – 12 months
$’000
1 – 5 years
$’000
GROUP
$’000
30 June 2021
Trade and other payables
Lease liabilities
Loans and borrowings
Other payables
Total financial liabilities exposed to liquidity risk
30 June 2020
Trade and other payables
Lease liabilities
Loans and borrowings
Total financial liabilities exposed to liquidity risk
254
53
6,500
—
6,807
2,033
182
—
2,215
—
—
8,546
—
8,546
—
182
5,450
5,632
—
—
13,960
14,586
28,546
—
53
—
53
254
53
29,006
14,586
43,899
2,033
417
5,450
7,900
41
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
17. FINANCIAL INSTRUMENTS (Continued)
(g) Fair values
The carrying amounts and estimated fair values of financial assets and financial liabilities for the Group held at balance date are determined
as disclosed below. The fair value of a financial asset or a financial liability is the amount at which the asset could be exchanged, or liability
settled in a current transaction between willing parties after allowing for transaction costs.
The fair values of the financial instruments of the Group approximates carrying values.
The following methods and assumptions are used to determine the net fair value of each class of financial instrument:
Cash
The carrying amount approximates fair value because of its short-term to maturity.
Trade and other receivables
The carrying amount approximates fair value.
Investments
The Australian accounting standards set out the following hierarchy for fair value measurement for investments in financial
instruments which are set out as below:
Level 1: - Quoted prices in active markets for identical assets or liabilities.
Level 2: - Inputs other than quoted prices, which can be observed either directly (as prices) or indirectly (derived from prices).
Level 3: - Inputs that are not based on observable market data.
The following table shows the levels within the hierarchy of financial assets and liabilities measured at fair value on a recurring basis as at
30 June 2021.
Financial Assets
Listed trading investments
Listed strategic investments
Unlisted strategic investments
Total Financial Assets
Note
Level 1
Level 2
Level 3
9
11
11
8,448
49,341
-
57,789
-
-
16,414
16,414
-
-
-
-
Total
8,448
49,341
16,414
47,203
The Group has two separate and distinct investment portfolios and designates its investments as either trading or strategic.
Investments within all the portfolios are remeasured to fair value based on the appropriate level inputs at the end of the reporting
period. All non-equity accounted listed securities are remeasured to fair values using Level 1 inputs as determined by reference to
the quoted market close price at balance date. Non-equity accounted unlisted securities are remeasured to fair values using Level 2
inputs referencing either share of net assets or last transaction price at balance date.
Financial Liabilities
Contingent Consideration
Total Financial Liabilities
Note
Level 1
Level 2
Level 3
24
-
-
14,586
14,586
-
-
Total
14,586
14,586
Contingent Consideration has been remeasured to fair value using a Level 2 input, share of net assets, as set out in Note 24(i).
Trade and other payables
The net fair value of accounts payable is based on the expected future cash out flows required to settle liabilities. As such carrying value
approximates fair value.
Loans to and from related parties
The net fair value of loans receivable and payable is based on expected future cash flows.
Advance facilities
The net fair value of advance facilities is equal to the face value of these facilities at balance date net of borrowing costs.
42
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Notes to Financial Statements (Continued)
FOR THE YEAR ENDED 30 JUNE 2021
18. LEASES, COMMITMENTS AND CONTINGENCIES
(a) Leases
The Group, its joint ventures and its associates enter into operating leases as a means of acquiring access to property assets. The Group’s
and its share of lease liabilities of its combined interests in joint ventures and associates is $53 (2020: $417).
During the period, right of use assets were amortised by $344 (2020: $7,957) and lease rental payments of $380 (2020: $8,154) were used
to reduce the lease liabilities by $364 (2020: $7,941) and meet $16 (2020: $213) of lease liability interest. At balance date, the carrying
value of the Group’s right of use assets were $57 (2020: $401).
After balance date, the Group entered into a new 5-year office lease. At lease commencement date, the Group recognised a $1,516
right-of-use asset and a corresponding $1,516 lease liability in its balance sheet.
(b) Commitments
The Group enters into contractual capital commitments with investment vehicles from time to time, as at balance date the Group’s uncalled
capital commitments were $4,567 (2020: $2,094).
(c) Contingent liabilities and guarantees
Controlled entities, associates and joint ventures
Ariadne, including some of its subsidiaries, have given guarantees and indemnities in relation to the borrowings and performance of several
of its controlled entities under agreements entered into by those entities. All borrowings and performance obligations are directly
supported by assets in the entities on the behalf of which these guarantees and indemnities have been provided.
The Group acquired an additional 30% equity interest in ONZUT from an existing unitholder during the period. The deferred
consideration for the acquisition was estimated to be $14,586 at balance date, although the terms of the acquisition provide that the
ultimate purchase price will be determined and paid following completion of the Site 18 Stage 1 Works (as defined in the Development
Agreement with Panuku Development Auckland) which is expected to be before June 2026. Refer to Note 24 for further information.
Details of finance facilities for the controlled entities are included in Note 14. Ariadne has guaranteed $10,000 (2020: $10,000) of the
borrowing obligations under these facilities.
Ariadne has also provided a guarantee on behalf of ONZUT for finance facilities totalling NZ$13,200 (2020: NZ$14,400). The assets
provided by ONZUT as security in relation to its finance facilities are sufficient to meet its obligations.
19. PARENT ENTITY INFORMATION
Information relating to Ariadne Australia Limited
Current assets
Total assets
Current liabilities
Total liabilities
Issued capital
Reserve – capital profits
Reserve – profits
Reserve – options
Accumulated losses
Total shareholders’ equity
Profit / (loss) of the parent entity
Total comprehensive income of the parent entity
ARIADNE
2021
$’000
2020
$’000
—
38,634
—
—
378,156
2,955
29,713
127
(372,317)
38,634
(4)
(4)
500
38,633
—
—
378,156
2,955
29,713
164
(372,355)
38,633
465
465
The nature and purpose of each reserve is disclosed in Note 15(c) and details of guarantees given are recorded in Note 18(c).
The financial information for the parent entity has been prepared on the same basis as the consolidated financial statements, except
investments in subsidiaries, associates and joint venture entities are accounted for at cost and dividends received from associates are
recognised in the parent entity’s profit or loss when its right to receive the dividend is established.
43
A R I A D N E A U S T R A L I A L I M I T E D
Notes to Financial Statements (Continued)
202 1 A N N U A L R E P O R T
FOR THE YEAR ENDED 30 JUNE 2021
20. RELATED PARTY DISCLOSURES
Ultimate parent
Ariadne Australia Limited is the ultimate parent company.
Related parties within the Group
Balances and transactions between Ariadne’s controlled entities have been eliminated on consolidation and are not disclosed in this note.
Details of transactions between the Group and other related parties are disclosed below.
Other related party balances and transactions
Balance / transaction type
Class of related party
Notes
GROUP
2021
$’000
2020
$’000
Loans to other related parties
Loans advanced
Loans repaid
Loans outstanding
Equity accounted investment
Equity accounted investment
Equity accounted investment
Loans from other related parties
Loans received
Loans outstanding
Director related entity
Director related entity
Investments in related parties
Investments in other financial assets
Director related entity
Investments in equity accounted investments
Equity accounted investment
Other transactions
Rent received or receivable
Equity accounted investment
Interest received or receivable
Equity accounted investment
Licence fees received or receivable
Equity accounted investment
Management fees paid or payable
Consulting fees paid or payable
Director related entity
Director related entity
Dividends and distributions received
Equity accounted investment
(i)
(i)
(ii)
(iii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
(x)
All transactions with related parties are conducted on normal commercial terms and conditions.
7,918
624
14,463
6,500
6,500
1,197
1,075
49
186
24
196
44
1,608
2,778
151
10,932
—
—
2,724
1,000
27
348
30
160
44
—
(i)
The Group advanced $7,918 to entities associated with Kippax Property Trust (“KPT”) to fund real estate development projects and received loan
repayments of $71 from KPT and $553 from Orams during the period.
At balance date, the Group had $9,677 in loans outstanding to entities associated with KPT and $4,786 to Orams.
(ii)
(iii) The Group received a non-interest-bearing loan of $6,500 from an entity associated with the Deputy Chairman, Mr Kevin Seymour during the period.
(iv) Mr Barter is an Executive Director of King River Capital Management Pty Ltd (“KRC”). The Group made investments of $1,197 during the
period which were associated or otherwise managed by entities related to KRC.
The Group invested $1,075 as part of capital raising by Hillgrove during the period, further information can be found at Note 13(a).
(v)
(vi) The Group earned rental income of $49 from KPT during the period.
(vii) Gross interest earned on loans to related entities.
(viii) Mr Barter, KRC and entities associated with KRC were appointed as authorised representatives for one of the Group’s wholly owned subsidiaries,
which holds an Australian Financial Services Licence, for part of the period under an agreement. During the period, the Group received $24 from
KRC relating to this agreement.
(ix) The Group paid investment management fees of $196 during the period to an entities related to KRC.
(x) Mr Baffsky performed various consulting services to the Group outside of his Director’s duties. Mr Baffsky was paid on commercial terms for consulting
work performed of $44. Mr Baffsky, in his role as Chairman of the Board of Directors and for other purposes, utilises an office and car park at
premises leased by the Group.
44
A R I A D N E A U S T R A L I A L I M I T E D
Notes to Financial Statements (Continued)
202 1 A N N U A L R E P O R T
FOR THE YEAR ENDED 30 JUNE 2021
21. DIRECTOR AND EXECUTIVE DISCLOSURES
Remuneration of Key Management Personnel
Short term employee benefits
Post-employment benefits
Share based payments
Total remuneration
22. REMUNERATION OF AUDITORS
Amounts received or due and receivable by Grant Thornton Audit Pty Ltd
An audit or review of the financial report of the entity and any other entity in the Group
Services in relation to the entity and any other entity in the Group
Amounts received or due and receivable by Deloitte Touche Tohmatsu
An audit or review of the financial report of the entity and any other entity in the Group
Services in relation to the entity and any other entity in the Group
GROUP
2021
$’000
2020
$’000
1,654
110
4
1,768
1,698
109
35
1,842
2021
$
2020
$
126,500
—
—
—
126,500
—
—
140,800
—
140,800
23. EVENTS AFTER THE BALANCE DATE
After the balance date, the Directors declared a final dividend on ordinary shares in respect of the 2021 financial year. The total amount
of the dividend is $981 which represents a partially franked (40%) dividend of 0.5 cents per share, of which 60% is sourced from the
Conduit Foreign Income Account.
The outbreak of COVID-19 and the subsequent quarantine measures imposed by the Australian and other governments as well as the
travel and trade restrictions imposed by Australia and other countries in early 2020 have caused significant and widespread disruption to
businesses and economic activity in Australia. At the date of approving these financial statements, the Directors are of the view the effects
of COVID-19 do not change the significant estimates, judgements and assumptions in the preparation of the financial statements, however
COVID-19 and its associated economic impacts remain uncertain. The Directors continue to closely monitor developments with a focus
on potential financial and operational impacts and note that the situation is continuing to evolve.
Apart from the matters above, there is no other matter of circumstance that has arisen since 30 June 2021 that has significantly affected,
or may significantly affect the Group’s operations, the results of those operations, or the Group’s state of affairs in the future financial
periods.
45
A R I A D N E A U S T R A L I A L I M I T E D
Notes to Financial Statements (Continued)
202 1 A N N U A L R E P O R T
FOR THE YEAR ENDED 30 JUNE 2021
24. BUSINESS COMBINATION
Control of Orams NZ Unit Trust (“ONZUT”)
On 28 February 2020, Ariadne entered into conditional agreements to acquire an additional 30% equity interest in ONZUT from an
existing unitholder subject to obtaining the approval of the New Zealand Overseas Investment Office as well as other necessary
consents. On 14 July 2020, Ariadne announced that all approvals and necessary consents had been received and that the additional
30% interest had been transferred to Ariadne, increasing its interest in the ONZUT to 80% and its indirect holding in Orams Group
Limited (“Orams”) to 61% (“Date of Transfer”). ONZUT became a controlled entity and subsidiary of Ariadne, with its results
consolidated by Ariadne from the Date of Transfer. The estimated purchase price on the Date of Transfer was $9,955 but has
increased to $14,586 at balance date. The terms of the acquisition provide that the ultimate purchase price will be determined and
paid following completion of the Site 18 Stage 1 Works (as defined in the Development Agreement with Panuku Development
Auckland) which is expected to be before June 2026 (“Contingent Consideration”).
The following table summarises the fair value of consideration and the fair value of the assets acquired and liabilities assumed as at
14 July 2020.
Consideration
Fair value of Contingent Consideration
Fair value of the Group’s equity interest in ONZUT held before the business combination
Total value of interest before the business combination
Assets acquired and liabilities assumed
The fair value of the identifiable assets and liabilities of ONZUT as at 14 July 2020 were:
Notes
$’000
(i)
13(b)
9,955
16,593
26,548
Assets
Cash and cash equivalents
Prepayments
Receivables
Investments in joint ventures and associates
Total Assets
Liabilities
Trade and other payables
Interest-bearing loan – due within 12 months or less
Interest-bearing loan – due within 1-5 years
Other liabilities payable to the Group – eliminated on consolidation
Total Liabilities
Total identifiable net assets at fair value
Non-controlling interest measured at its proportionate share
(Gain) / loss arising on acquisition
Total value of interest after the business combination
(ii)
(iii)
(iv)
(v)
(vi)
39
112
5,339
54,717
60,207
154
1,401
15,417
10,051
27,023
33,184
(6,636)
—
26,548
(i) No cash was transferred on acquisition due to the deferred Contingent Consideration. Fair value of the Contingent Consideration on acquisition
has been estimated as 30% of ONZUT’s net equity utilising ONZUT’s 30 June 2020 audited financial statements. Although no gain or loss was
recognised on acquisition, a $4,631 increase to the fair value of the Contingent Consideration component (to $14,586), equal to 30% of the
movement in ONZUT’s net assets during the period, was recognised through ‘Fair value loss on financial liabilities’ in the Group’s Statement
of Profit or Loss and Other Comprehensive Income.
(ii) Net cash acquired of $39 has been included as flows from investing activities in the Group’s Statement of Cash Flows.
(iii) The fair value of ONZUT’s investment in Orams has been estimated by utilising Orams’ 30 June 2020 audited financial statements.
(iv) The current portion of ONZUT’s New Zealand dollar interest-bearing loan was valued at A$1,396 at balance date.
(v)
(vi) Other liabilities payable to the Group are eliminated on consolidation.
(vii) The numbers in this note differ to those included in the Half Year Report due to a prior period correction as set out in Note 2(x).
The non-current portion of ONZUT’s New Zealand dollar interest-bearing loan was valued at A$13,960 at balance date.
From the date of acquisition and excluding all intergroup transactions, ONZUT has contributed $5,449 in revenues and a $2,723 in
profits to the Group.
46
A R I A D N E A U S T R A L I A L I M I T E D
202 1 A N N U A L R E P O R T
Directors’ Declaration
FOR THE YEAR ENDED 30 JUNE 2021
In accordance with a resolution of the Directors of Ariadne Australia Limited, I state that:
1. In the opinion of the Directors:
(a) the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001, including;
(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2021 and of its performance for the year
ended on that date; and
(ii) complying with the Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations
Regulations 2001; and
(b) the financial statements and notes also comply with International Financial Reporting Standards as disclosed in Note 2; and
(c) there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable.
2. This declaration has been made after receiving the declarations required to be made to the Directors in accordance with section 295A
of the Corporations Act 2001 for the financial year ending 30 June 2021.
On behalf of the Board
Mr David Baffsky, AO
Chairman
Sydney
30 August 2021
47
A R I A D N E A U S T R A L I A L I M I T E D
Independent Auditor’s Report
202 1 A N N U A L R E P O R T
48
A R I A D N E A U S T R A L I A L I M I T E D
Independent Auditor’s Report
202 1 A N N U A L R E P O R T
49
A R I A D N E A U S T R A L I A L I M I T E D
Independent Auditor’s Report
202 1 A N N U A L R E P O R T
50
A R I A D N E A U S T R A L I A L I M I T E D
Independent Auditor’s Report
202 1 A N N U A L R E P O R T
51
A R I A D N E A U S T R A L I A L I M I T E D
Shareholder Information
202 1 A N N U A L R E P O R T
Additional information required by the Australian Securities Exchange Ltd and not shown elsewhere in this report is as follows.
The information is current as at 31 July 2021.
(a) Distribution of equity securities
The number of shareholders, by size of holding, in each class of share are:
1
1,001
5,001
10,001
100,001
1,000
5,000
10,000
100,000
–
–
–
–
and over
Ordinary shares
Number of
holders
232
542
199
257
97
1,327
Number of
shares
64,223
1,644,818
1,458,118
7,920,120
185,155,081
196,242,360
Holding less than a marketable parcel
214
46,223
(b)
Twenty largest shareholders
The names of the twenty largest holders of quoted shares are:
Number of shares
% of shares
Listed ordinary shares
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Bivaru Pty Ltd
UBS Nominees Pty Ltd
SLV Investments Pty Ltd
J P Morgan Nominees Australia Limited
W B K Pty Ltd
Seymour Group Pty Ltd
Kayaal Pty Ltd
Mr Con Zempilas
BNP Paribas Nominees Pty Ltd Six Sis Ltd
National Nominees Pty Ltd
Mr Ronald Langley + Mrs Rhonda Elizabeth Langley
Equitas Nominees Pty Limited
Katdan Investments Pty Limited
Mr John Emery Kennedy
Mr David Zalmon Baffsky
LVS Nominees Pty Ltd
Mr Ronald Langley
HSBC Custody Nominees (Australia) Limited
Mr Ross Alexander Macperhson
Katdan Investments Pty Limited
64,666,395
21,405,078
21,043,100
16,838,614
5,485,100
4,580,000
3,922,294
3,664,000
3,615,365
2,965,392
2,134,923
2,000,000
2,000,000
2,000,000
1,983,230
1,757,173
1,380,000
1,275,470
1,213,700
1,199,483
165,129,317
32.95%
10.91%
10.72%
8.58%
2.80%
2.33%
2.00%
1.87%
1.84%
1.51%
1.09%
1.02%
1.02%
1.02%
1.01%
0.90%
0.70%
0.65%
0.62%
0.61%
84.15%
(c) Substantial shareholders
The names of substantial shareholders who have notified the Company in accordance with
section 671B of the Corporations Act 2001 are:
Bivaru Pty Ltd and associated entities
Thorney Holdings Pty Ltd and Thorney Pty Ltd and associated entities
Leigh Vanessa Seymour and associated entities
Kayaal Pty Ltd and associated entities
Phoenix Portfolios Pty Ltd
Number of shares
as per notice
67,639,743
21,720,617
21,181,898
13,987,394
10,494,743
(d) Voting rights
All ordinary shares carry one vote per share without restriction.
52
A R I A D N E A U S T R A L I A L I M I T E D