Building Australia
for over 100 years
ANNUAL REPORT 2023
Contents
4 Chairman and Managing Director’s Report
6 Directors’ Report
23 Auditor’s Independence Declaration
24 Statement of Profit or Loss and Other Comprehensive Income
25 Statement of Financial Position
26 Statement of Changes in Equity
27 Statement of Cash Flows
28 Notes to the Financial Statements
69 Directors’ Declaration
70 Independent Auditor’s Report to the Members of Big River Industries Limited
74 Shareholder Information
76 Corporate Directory
77 Branch Network
Big River Industries Limited Annual Report 2023 Big River’s geographic,
market segment
and supply chain
diversity delivers
growth through the
construction cycle.
1
Annual Report 2023 Big River Industries Limited Overview
Highlights
Revenue
$449.5m
EBITDA
$51.5m
NPAT
$22.1m
9.8%
7.3%
3.8%
Total Dividends
17.1 cps
10.3%
2
Big River Industries Limited Annual Report 2023 Overview
Chairman and
Managing Director’s
Report
Big River continued
the momentum of
solid results delivering
positive growth for
FY23 and strong cash
management.
Operating Highlights
We are pleased to present the
Chairman and Managing Director’s
report for FY2023 on behalf of the
Board.
Big River continued its strong
growth trajectory of the past few
years, delivering positive revenue
and profit growth for the Group
despite the significant market
challenges during the fiscal year.
As has been well documented, the
industry experienced construction
delays in every market segment,
predominantly driven by labour
shortages and disruption to global
supply chains. Despite this, the
Group revenue was up 9.8%,
including organic revenue growth
of 2.8%, with growth in both the
Panels and Construction divisions.
These increases resulted in record
revenues of $449.5m, with strong
performances from our Qld, SA and
WA businesses, and the contribution
from new acquisitions.
Our gross margin continues to
improve, up 55 basis points, on
a favourable product mix and
disciplined price management.
This delivered a strong underlying
profit result with EBITDA (before
significant items) up 7.3% to $51.5m
at 11.5% of revenue, well above our
average through cycle target.
Balance Sheet and
Dividends
A highlight of the year was the very
strong cash flows delivered through
focused management on working
capital. Following the improvements
in international supply chains in
the back half of the year, proactive
management of our inventory levels
saw inventory decline by $3.3m in
the year to $69.5m.
The formation of a new national
credit team and tight credit
management by the branches
delivered an improvement in trade
receivables from 44 days to 43
days. Net debt was reduced by
$10.0 m to $11.2m with gearing of
8.5% at 20 June 2023. This provides
significant capacity for continued
investment in the business.
Well considered acquisitions of
quality businesses remains a core
pillar of our strategy. Both FA
Mitchell and Epping Timber joined
the group in the fiscal year and have
integrated well into the business,
delivering positive results in line
with our forecasts. The business
will continue to seek out acquisition
opportunities that deliver value.
The diversity of the Group’s supply
chain has been a strong competitive
advantage over many years. The
Grafton Consolidation project is
almost complete and expected to
be fully operational by late CY2023,
delivering quality differentiated
products for our customers across
both the Panels and Construction
divisions.
The business continues to invest
for growth, initiating several
operational improvement programs
aimed at enhancing our systems,
processes and support structures in
Operations, IT, Finance and HR that
will deliver efficiencies.
3
Annual Report 2023 Big River Industries Limited Overview
Chairman and
Managing Director’s
Report
continued
The transition of both CEO and
CFO has been managed well and
combined with an experienced
incoming Chair in Martin Monro,
the business is well positioned
for delivering the next phase of
evolution and growth.
People & Safety
The Big River team have done
an excellent job managing the
uncertainties in the market and
delivering outstanding growth.
The accountability, flexibility and
coherence of the team is the
cornerstone of our success. Safety
and looking after each other has
been a core theme for the year and
we are pleased to report that all the
teams across Australia and New
Zealand have been fully committed
to the initiatives that flow from our
‘Safety First’ philosophy.
Finally, the Board would like to
take the opportunity to sincerely
thank our valuable staff for their
ongoing passion, commitment,
and dedication.
Malcolm Jackman
Chairman
John Lorente
Managing Director
and Chief Executive
Officer
As communicated earlier in the year,
Malcolm Jackman will be retiring
as the Chair of the Board at the
upcoming AGM, with the Board
endorsing current director Martin
Monro as Chair-Elect. Malcolm has
been a director of the business
since 2016 and Chair since 2019,
guiding the business through a
period of exceptional growth. The
Board would like to thank Malcolm
for his leadership, passion and
unwavering dedication to the
business and congratulate Martin
on his upcoming appointment.
These changes will take the Board
from seven members to six, with
three independent directors, post
the AGM.
Our strong cash position allowed
the board to endorse a fully franked
total dividend of 17.1c for the year
to our shareholders, at 63.9% to
sales payout ratio, in line with the
previous year.
Corporate Governance
There were significant changes
to our senior management team
in the year. John O’Connor joined
the business in August as CFO
and Company Secretary bringing
a broad financial knowledge,
experience and energy to
the business.
Jim Bindon, our long serving
CEO retired partway through the
year following 17 years delivering
exceptional leadership to the Group.
John Lorente was promoted from
within to the CEO role on 1st March
2023.
4
Big River Industries Limited Annual Report 2023 Financial Report
Financial Report
2023
Contents
6 Directors’ Report
23 Auditor’s Independence Declaration
24 Statement of Profit or Loss and Other Comprehensive Income
25 Statement of Financial Position
26 Statement of Changes in Equity
27 Statement of Cash Flows
28 Notes to the Financial Statements
69 Directors’ Declaration
70 Independent Auditor’s Report to the Members of Big River Industries Limited
5
Annual Report 2023 Big River Industries Limited Directors’ Report
Big River Industries Limited
Directors' report
30 June 2023
30 June 2023
The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as
the 'Group') consisting of Big River Industries Limited (referred to hereafter as the 'Company' or 'parent entity') and the entities
it controlled at the end of, or during, the year ended 30 June 2023.
Directors
The following persons were directors of Big River Industries Limited during the whole of the financial year and up to the date
of this report, unless otherwise stated:
John Lorente
Malcolm Geoffrey Jackman
Martin Monro
Martin Kaplan
Vicky Papachristos
Brendan York
Brad Soller
James Bernard Bindon
Managing Director and Chief Executive Officer (appointed 1 March 2023)
Chair*
Chair-Elect**
Former Managing Director and Chief Executive Officer (until 1 March 2023)***
Will retire at the 2023 AGM in October 2023
Expected to be appointed as Chair at the 2023 AGM in October 2023
*
**
*** Remained an employee until 31 March 2023
Principal activities
During the financial year the principal continuing activities of the Group consisted of the manufacture of veneer, plywood and
formply, and the distribution of building supplies, including commercial and formwork product.
Dividends
Dividends paid
Dividends paid during the financial year were as follows:
Final dividend of 10.0 cents per fully paid ordinary share paid on 6 October 2022 (2022: 3.0
cents paid on 6 October 2021)
Interim dividend of 8.6 cents per fully paid ordinary share paid on 29 March 2023 (2022: 5.5
cents paid on 6 April 2022)
2023
$'000
Group
2022
$'000
8,291
2,419
7,139
4,520
15,430
6,939
Dividend declared
On 23 August 2023, the directors determined a fully franked dividend of 8.5 cents per fully paid ordinary share to be paid on
6 October 2023.
Review of operations
Revenue for the year ended 30 June 2023 was $449.5 million, up 9.8% from $409.3 million in the previous financial year due
to continued organic growth and contribution from recent acquisitions, being eleven months from F.A. Mitchell and seven
months from Epping Timber. Comparable store revenue grew by 2.8% on like-for-like basis (stores trading for a full financial
year).
Revenue growth along with improvement of 55 bps in gross margin and the contribution from acquisitions saw EBITDA*
increasing from $48.0 million in previous financial year to $51.5 million in the current financial year, a growth of 7.3%.
During FY2023, the Group completed the acquisition of F.A. Mitchell and Epping Timber with associated acquisition costs of
$0.6 million. These businesses contributed $14.6 million to revenue for the year ended 30 June 2023.
During FY2023, the Group also completed sale of land and building at its Wagga site and received net consideration of $2.7
million. The expanded Grafton site was largely commissioned by 30 June 2023.
6
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Big River Industries Limited
Directors' report
30 June 2023
30 June 2023
Net profit after tax (‘NPAT’) was $22.1 million, up 4.3% on the previous financial year of $21.3 million.
The directors consider EBITDA* to reflect the core earnings of the Group. EBITDA* is a financial measure which is not
prescribed by Australian Accounting Standards ('AAS') and represents the profit under AAS adjusted for non-cash and
significant items.
The Group’s reconciliation of its statutory net profit after tax (‘NPAT’) for the current and previous year to EBITDA is as
follows:
Summary results
Revenue
EBITDA*
Depreciation
Amortisation
Earnings before interest and tax ('EBIT')
Finance costs
Net profit before tax ('NPBT') and before significant items
Taxation
Net profit after tax ('NPAT') and before significant items
Significant Items
Statutory NPAT
Significant items:
Acquisition costs
Share-based remuneration
Recovery of assets and restructuring costs
Tax benefit/(expense)
Total significant items
2023
$'m
Group
2022
$'m
449.5
409.3
51.5
(11.4)
(2.4)
37.7
(4.8)
32.9
(9.7)
23.2
(1.1)
22.1
(0.6)
(0.6)
-
0.1
(1.1)
48.0
(10.8)
(1.4)
35.8
(3.2)
32.6
(10.1)
22.5
(1.2)
21.3
(1.0)
(0.9)
0.7
-
(1.2)
*
EBITDA is net profit before interest, taxes, depreciation, amortisation and significant costs which are share-based remuneration, acquisition costs and restructuring costs.
Segment performance
Panels
Construction
Corporate
Segment revenue
2022
$'m
2023
$'m
Segment EBITDA
2022
$'m
2023
$'m
128.5
321.0
-
117.1
292.2
-
449.5
409.3
19.2
39.3
(7.0)
51.5
21.4
31.9
(5.3)
48.0
Both divisions achieved both organic revenue growth and contribution from new acquisitions (and a full 12-month contribution
from the prior year acquisition of Revolution Wood Panels and United Building Products).
3
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Big River Industries Limited
Directors' report
30 June 2023
30 June 2023
Cash and Debt
Cash and cash equivalents
Bank bills
Bank overdraft and trade/lease finance
Net debt
Contingent consideration*
Net debt adjusted for contingent consideration
2023
$'m
34.3
(41.0)
(4.5)
(11.2)
2022
$'m
19.8
(36.0)
(5.0)
(21.2)
(5.8)
(7.9)
(17.0)
(29.1)
*
Contingent consideration represents estimated fair value of future payments to vendors of previously completed acquisitions. These payments are contingent on the achievement of
certain financial targets of that acquired business. Refer note 24 'Contingent consideration' for further details.
The Group has a net debt position of $11.2m as at 30 June 2023, a reduction of $10.0m compared to 30 June 2022. The
Group remains in a strong balance sheet position with a reduction in gearing (measured as Net Debt/Net Debt plus Equity)
occurring during FY2023, closing the year at 8.5%, versus the 15.9% in the previous financial year.
From an operating cash flow perspective, the Group achieved a 112% EBITDA to cash conversion, this very strong outcome
was driven by efficient working capital management resulting 6.2% reduction in working capital.
Material business risks
The Group is subject to general risks as well as risks that are specific to the Group and the Group’s business activities. The
following is a list of risks which the Directors believe are or potentially will be material to the Group’s business, however, this
is not a complete list of all risks which the Group is or may be subject to.
General economic risks
The Group is subject to general risks as well as risks that are specific to the Group and the Group’s business activities.
Economic conditions, movements in interest and inflation rates and currency exchange rates may have an adverse effect on
the Group’s procurement and production activities, as well as its ability to fund those activities.
Products and Raw Material Supply
Any adverse change in the Group’s ability to procure raw materials and products could adversely affect impact the operations
and profitability of the business. Big River maintains a diverse range of reputable suppliers both locally and internationally
that they have developed long term relationships with.
Work Health and Safety
Big River is focused on safety of its staff and customers. Occupational accidents and health hazards can result in employee
injuries, legal liabilities, increased insurance costs, and operational disruptions.
Key Personnel risks
Big River’s success depends on the continued active participation of its key personnel. If Big River were to lose any of its
key personnel or if it were unable to employ additional or replacement personnel, its operations and financial results could
be adversely affected.
IT system failure and cyber security risks
Any information technology system is potentially vulnerable to interruption and/or damage from several sources, including
but not limited to computer viruses, cyber security attacks and other security breaches, power, systems, internet and data
network failures, and natural disasters. The Group is committed to preventing and reducing cyber security risks through
ongoing management of the risks and continuous review.
Climate related
There may be climate related factors which impact Big River’s operations in both the near and longer term. For example,
these impacts could be in areas such as availability and cost of materials used in Big River’s products or manufacturing
processes, transport and/or occurrence of extreme weather events. Any significant or sustained impacts could adversely
affect Big River’s financial performance and/or financial position.
8
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Big River Industries Limited
Directors' report
30 June 2023
30 June 2023
Significant changes in the state of affairs
Acquisition of businesses
F.A. Mitchell & Co Pty Ltd ('Mitchell')
On 7 July 2022, the Group executed a business purchase deed to acquire the business and assets of F.A. Mitchell & Co Pty
Ltd ('Mitchell'), a business located in Lidcombe, NSW. Completion was effective from 1 August 2022 with a purchase price
of $598,000 paid in cash, which includes inventory and plant and equipment. The acquisition contributed $4.2 million to
revenue and $0.2 million to net profit after tax of the Group for the year ended 30 June 2023.
Epping Timber Joinery & Hardware Pty Ltd and Epping Timber Prefab Pty Ltd ('Epping Timber')
On 14 November 2022, the Group executed a business purchase deed to acquire the business and assets of Epping Timber
Joinery & Hardware Pty Ltd and Epping Timber Prefab Pty Ltd ('Epping Timber'), a business located in Epping and Beaufort,
VIC. Completion was effective from 1 December 2022 and the maximum purchase price of $6 million, which includes
inventory, and plant and equipment, was settled through the payment of $5 million in cash, with the balance payable upon
achieving agreed EBITDA targets over a two year period. The acquisition contributed $10.4 million to revenue and $0.5
million to net profit after tax of the Group for the year ended 30 June 2023.
Resignation and appointment of CEO
Jim Bindon tendered his resignation as Managing Director and CEO on 5 September 2022. Subsequently, John Lorente was
appointed as Managing Director and CEO effective 1 March 2023. Jim Bindon stepped down from his roles on 1 March 2023,
but remained in the business until 31 March 2023.
There were no other significant changes in the state of affairs of the Group during the financial year.
Matters subsequent to the end of the financial year
Apart from the dividend declared as discussed above, no other matter or circumstance has arisen since 30 June 2023 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 future financial years.
Likely developments and expected results of operations
The building products market is closely linked to activity levels in the residential, commercial, civil and infrastructure
construction industry (comprising both new builds and additions and alterations) in Australia. The industry is cyclical and is
sensitive to a broad range of economic and other factors.
The higher than cycle gross margins achieved in the past 18 to 24 months, have eased the second half of FY2023 with an
improvement in overseas supply. However, this will be offset in part from some local suppliers where labour and energy
costs increases will likely impact. The diversity of our supply chain has us well positioned to maximise the upside.
The Group has a strong balance sheet and a healthy undrawn banking facility which will continue to support the Group
expansion strategy. The acquisition pipeline remains strong, and we are in a good position to deliver new opportunities in
the next 12 to 24 months in line with our strategy.
Environmental regulation
The Group is not subject to any significant environmental regulation under Australian Commonwealth or State law.
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Information on directors
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
John Lorente
Managing Director and Chief Executive Officer (appointed 1 March 2023)
John holds a Bachelor of Science from the University of Sydney, a Masters of Business
Administration from Macquarie Graduate School of Management and is an Affiliate of
the Australian Institute of Company Directors (AICD).
John Lorente joined Big River in February 2018 and was appointed Managing Director
and CEO on 1 March, 2023. Prior to joining Big River, John worked for GWA Group Ltd
(a leading supplier of building fixtures and fittings) for 12 years where he had various
roles in state management and national management within both the Heating and
Cooling, and Kitchens and Bathroom divisions which included roles in both Australia
and the USA. Prior to his time at GWA Group Ltd, John worked for several years in the
coatings and construction markets, including roles with Mirotone, Polycure and Corian.
Director of Natbuild (National Building Supplies) Group Pty Ltd since November 2022
(non-listed)
Former directorships (last 3 years): None
None
Special responsibilities:
134,435 ordinary shares (directly)
Interests in shares:
36,588 ordinary shares (indirectly)
238,047 performance rights (directly)
Interests in rights:
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Malcolm Geoffrey Jackman
Independent Non-Executive Chair (Retiring at the 2023 AGM in October 2023)
Malcolm has a Bachelor of Science in Pure Mathematics and a Bachelor of Commerce
in Accounting from Auckland University. He is a fellow of the Australian Institute of
Directors and a recipient of the Centenary of Federation Medal.
Malcolm has been an independent Non-Executive Director of the Company since
February 2016 and became Chairman on 31 July 2019. Malcolm has also been a
director of Big River Group Pty Limited since February 2016. Malcolm is a member of
the Anacacia Capital Business Advisory Council.
Independent Non-Executive Chair of Force Fire Pty Ltd (non-listed) and Harold and
Kite Pty Ltd (non-listed)
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in rights:
Chair of the Board
135,340 ordinary shares (indirectly)
None
10
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Big River Industries Limited
Directors' report
30 June 2023
30 June 2023
Name:
Title:
Qualifications:
Experience and expertise:
Martin Monro
Non-Executive Director (Chair-Elect from 2023 AGM in October 2023)
Martin has a BA with a double major in Psychology from Flinders University and post-
graduate qualifications in Human Resources Management from Charles Sturt
University. He is a graduate of the London Business School Accelerated Development
Programme, a Fellow of the Australian Institute of Company Directors and a Fellow of
the Australian Institute of Building.
Martin was formerly the Chief Executive Officer and Managing Director of Watpac
Limited from August 2012 until his retirement in an executive capacity in June 2019.
Martin has more than 30 years’ experience in the Australian and International
construction sectors, with a proven track record in prudent financial management,
safety leadership and successful expansion into new markets. Martin remains a Non-
Executive Director of Watpac Limited (now BESIX Watpac). Since June 2020, Martin
has been a Non-Executive Director of Fleetwood Limited and Chair of its Risk
Committee, and in September 2022 joined the board of Service Stream Limited as a
Non-Executive Director. Martin is also a Specialist Workplace Relations Advisor to the
Board of the Australian Constructors Association where he was a Director from 2012
until 2019 and currently Chairs the advisory board of private wine making company
Pannell Enoteca.
Fleetwood Limited (ASX: FWD and Service Stream Limited (ASX: SSM)
Member of the Audit and Risk Committee and member of the Nomination and
Remuneration Committee
27,104 ordinary shares (directly)
None
Martin Kaplan
Non-Executive Director
Martin holds a Bachelor of Commerce degree from the University of Cape Town and
previously qualified as a Chartered Accountant (South Africa & Canada).
Martin has been a Non-Executive Director of the Company since November 2015 and
a director of Big River Group Pty Limited since February 2016. Martin is currently an
Investment Director of Anacacia Capital Pty Ltd, the management company of the
major shareholder Anacacia Partnership II, L.P.
Non-Executive Director of Direct Couriers Group Pty Ltd (non-listed)
Member of the Nomination and Remuneration Committee
Martin is an Investment Director of Anacacia Capital Pty Ltd which manages the
interests of Anacacia Partnership II, L.P., a substantial shareholder of the Company.
Martin does not have a relevant interest in those shares for the purposes of the
Corporations Act 2001.
None
None
Other current directorships:
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in rights:
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in shares:
Interests in rights:
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Directors' report
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30 June 2023
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Vicky Papachristos
Independent Non-Executive Director
Vicky holds an Engineering degree from Monash University, an MBA from the
Australian Graduate School of Management and is a member of the Australian Institute
of Company Directors.
Vicky is an experienced Non-Executive Director for over 10 years and has served on
public, private and not-for-profit Boards including Eftpos, Mt Baw Baw Alpine Resort,
Coventry Group and Scale Investors. In her corporate career she has experience in
blue chip companies, as well as running her own marketing and customer strategy
management consultancy firm. Vicky has been involved across various strategic and
business development roles with organisations including Shell, Westpac, and Myer.
Non-Executive Director of Aussie Broadband Limited (ASX: ABB) and Non-Executive
Director of GMHBA Limited
Former directorships (last 3 years): Non-Executive Director of Scale Investors Limited
Special responsibilities:
Interests in shares:
Interests in rights:
Chair of the Nomination and Remuneration Committee
34,968 ordinary shares (indirectly)
None
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Brendan York
Non-Executive Director
Brendan is a Chartered Accountant and has a Bachelor of Business Administration and
a Bachelor of Commerce from Macquarie University.
Brendan has been a Non-Executive Director of the Company since October 2019. He
is currently a portfolio manager of Naos Asset Management Limited. Brendan was
previously the Chief Financial Officer of ASX Listed Enero Group Ltd.
Non-Executive Director of BSA Limited (ASX: BSA), Non-Executive Director of Wingara
AG Limited (ASX: WNR), Non-Executive Director of BTC Health Limited (ASX: BTC),
Non-Executive Director of Saunders International Ltd (ASX: SND) and Non-Executive
Director of Mitchcap Pty Ltd (non-listed).
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in rights:
Member of the Audit and Risk Committee
None
None
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Brad Soller
Non-Executive Director (appointed 10 September 2021)
Brad is a Chartered Accountant and has a Master of Commerce, a Bachelor of
Accounting and a Bachelor of Commerce from the University of Witwatersrand.
Brad is a very experienced senior financial executive and previously held the roles of
Chief Financial Officer at Metcash, David Jones and Lendlease Group.
Non-Executive Director of Bapcor Limited (ASX: BAP) and Non-Executive Director of
Reliance Worldwide Corporation Limited (ASX: RWC)
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in rights:
Chair of the Audit and Risk Committee
13,552 ordinary shares (directly)
None
12
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Directors' report
30 June 2023
30 June 2023
Qualifications:
Name:
Title:
Experience and expertise:
James Bernard Bindon
Former Managing Director and Chief Executive Officer (until 1 March 2023 and formally
resigned 31 March 2023)
James ('Jim') holds a Bachelor of Agricultural Economics (Honours) from the University
of New England and a Masters of Business Administration from the University of
Queensland. Jim is a member of the Australian Institute of Company Directors.
Jim joined Big River in January 2001 and has been Chief Executive Officer and
Managing Director since 2005. He has been a director of Big River Group Pty Limited
since July 2005 and a director of the Company since February 2016. Prior to his current
role as Chief Executive Officer and Managing Director, Jim was the Chief Financial
Officer and Company Secretary from 2001 to 2005. Prior to working at Big River, Jim
held the position of Business Manager of Sugar and Horticulture at Incitec, where he
was responsible for segment profitability, strategy and marketing.
None
Other current directorships:
Former directorships (last 3 years): None
None
Special responsibilities:
840,480 ordinary shares (held indirectly on the date he ceased to be a director)
Interests in shares:
296,610 performance rights
Interests in rights:
'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all
other types of entities, unless otherwise stated.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities only and excludes
directorships of all other types of entities, unless otherwise stated.
'Interests in shares' and 'interests in rights' are as at the date of this report.
Company Secretary
John O'Connor
John O'Connor was appointed to the position of Company Secretary on 22 August 2022. John has a BComm, is a Chartered
Management Accountant and a Graduate of the Australian Institute of Company Directors. He has over 30 years' experience
in senior finance roles.
Meetings of directors
The number of meetings of the Company's Board of Directors ('the Board') and of each Board committee held during the
year ended 30 June 2023, and the number of meetings attended by each director were:
J Lorente
M Jackman
M Monro
M Kaplan
V Papachristos
B York
B Soller
J Bindon
Attended
Full Board
Held
Nomination and
Remuneration Committee
Held
Attended
Audit and Risk Committee
Held
Attended
4
10
10
10
10
10
10
6
4
10
10
10
10
10
10
6
-
-
4
4
4
-
-
-
-
-
4
4
4
-
-
-
-
-
4
-
-
4
4
-
-
-
4
-
-
4
4
-
Held: represents the number of meetings held during the time the director held office or was a member of the relevant
committee.
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Directors' report
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30 June 2023
Remuneration report (audited)
The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance
with the requirements of the Corporations Act 2001 and its Regulations, and explains how the Group's performance has
driven remuneration outcomes.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the
activities of the entity, directly or indirectly, including all directors.
The key management personnel of the Group are the directors of Big River Industries Limited and the following person:
●
John O'Connor - Chief Financial Officer and Company Secretary (appointed effective 22 August 2022)
The remuneration report is set out under the following main headings:
●
●
●
●
●
●
Principles used to determine the nature and amount of remuneration
Details of remuneration
Service agreements
Share-based compensation
Additional information
Additional disclosures relating to key management personnel
Principles used to determine the nature and amount of remuneration
The objective of the Group's executive reward framework is to ensure reward for performance is competitive and appropriate
for the results delivered. The framework aligns executive reward with the achievement of strategic objectives and the creation
of value for shareholders, and it is considered to conform to the market best practice for the delivery of reward. The Board
ensures that executive reward satisfies the following key criteria for good reward governance practices:
●
●
●
●
competitiveness and reasonableness;
acceptability to shareholders;
performance linkage / alignment of executive compensation; and
transparency.
The Nomination and Remuneration Committee is responsible for:
●
●
●
●
determining and reviewing remuneration arrangements for its directors and executives;
the operation of incentive plans, including equity-based remuneration plans for senior executives;
reviewing Board and senior executive succession plans; and
recommending the appointment of any new directors.
The quality of the directors and executives is a major factor in the overall performance of the Group. The remuneration
philosophy is to attract, motivate and retain high performance and high quality personnel.
The Nomination and Remuneration Committee has structured an executive remuneration framework that is market
competitive and complementary to achievement of the reward strategy of the Group.
The reward framework is designed to align executive reward to shareholders' interests. The Board has considered that it
should seek to enhance shareholders' interests by:
having economic profit as a core component;
●
focusing on sustained growth in shareholder value and delivering constant or increasing return on assets as well as
●
focusing the executive on key non-financial drivers of value; and
attracting and retaining high calibre executives.
●
Additionally, the reward framework should seek to enhance executives' interests by:
●
●
●
rewarding capability and experience;
reflecting competitive reward for contribution to growth in shareholder value; and
providing a clear structure for earning rewards.
In accordance with best practice corporate governance, the structure of non-executive director and executive director
remuneration is separate.
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30 June 2023
30 June 2023
Non-executive directors' remuneration
Fees and payments to non-executive directors reflect the demands and responsibilities of their role. Non-executive directors'
fees and payments are reviewed annually by the Nomination and Remuneration Committee. The Nomination and
Remuneration Committee may, from time to time, receive advice from independent remuneration consultants to ensure non-
executive directors' fees and payments are appropriate and in line with the market. The chairman's fees are determined
independently to the fees of other non-executive directors based on comparative roles in the external market. The chairman
is not present at any discussions relating to the determination of his own remuneration. Non-executive directors do not
receive share options or other incentives.
ASX listing rules require the aggregate non-executive directors' remuneration be determined periodically by a general
meeting. Unless otherwise determined by a resolution of shareholders, the maximum aggregate remuneration payable by
the Company to all non-executive directors of the Company for their services as directors, including their services on a Board
Committee or Sub-Committee and including superannuation is limited to $500,000 per annum (in total).
Executive remuneration
The Group aims to reward executives based on their position and responsibility, with a level and mix of remuneration which
has both fixed and variable components.
The executive remuneration and reward framework currently has three components:
●
●
●
fixed base salary, including superannuation and non-monetary benefits;
short-term performance incentives; and
long-term performance incentives.
The combination of these comprises the executive's total remuneration.
Fixed remuneration, consisting of base salary, superannuation and non-monetary benefits, are reviewed annually by the
Nomination and Remuneration Committee based on individual performance, the overall performance of the Group and
comparable market remunerations.
Executives may receive their fixed remuneration in the form of cash or other fringe benefits where it does not create any
additional costs to the Group.
The short-term incentive ('STI') program is designed to align the targets of the business with the performance hurdles of
executives. STI payments made to executives are at the discretion of the Board and are based on the achievement of
financial hurdles, principally relating to EBITDA performance, and key performance indicators ('KPI's') being achieved. KPI's
include profit contribution, cash management, customer satisfaction, safety performance, leadership contribution and product
management.
The STI's are paid in cash following the end of the financial year and approval from the Nomination and Remuneration
Committee. The Nomination and Remuneration Committee retains the discretion to withdraw or amend the STI at any time.
The long-term incentive program ('LTI') is designed to create an alignment between shareholders and the remuneration of
key executives and senior managers through the issue of Performance Rights. The number of Performance Rights vesting
will be determined by reference to the compound annual growth rate ('CAGR') in Earnings Per Share ('EPS') over the vesting
period and ranges from nil for less than 3% CAGR in EPS to 100% for greater than 10% CAGR in EPS, subject to an
overriding discretion held by the Board. The Board considers CAGR in EPS to be an appropriate performance measure as
it aligns with the Group’s remuneration policy of creating shareholder value and is within the scope of influence of the selected
executives.
Group performance and link to remuneration
Remuneration for the senior executives is directly linked to the performance of the Group. A portion of their STI is dependent
on meeting the Board approved Annual Budget for operating EBITDA. The remaining portion of the STI is based on
performance against objectives. In the event of a senior executive leaving during a financial year, any STI payable is at the
discretion of the Nomination and Remuneration Committee. Refer to the section 'Additional information' below for details of
the earnings for the last five years.
Use of remuneration consultants
During the financial year ended 30 June 2023, the Group did not engage remuneration consultants.
11
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Directors' report
30 June 2023
30 June 2023
Voting and comments made at the Company's 2022 Annual General Meeting ('AGM')
At the 25 October 2022 AGM, 99.89% of the votes received supported the adoption of the remuneration report for the year
ended 30 June 2022. The Company did not receive any specific feedback at the AGM regarding its remuneration practices.
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the Group are set out in the following tables.
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Cash salary
and fees
$
Cash
Non-
bonus monetary
$
$
Super-
annuation
$
Leave
benefits
$
Share-
based
payments
Perform-
ance
rights
$
Total
$
109,091
63,637
-
77,273
63,637
77,273
-
-
-
-
-
-
147,202
330,462
28,038
95,000
298,365
1,166,940
48,159
171,197
-
-
-
-
-
-
-
-
-
-
11,455
6,682
-
8,114
6,682
8,114
-
-
-
-
-
-
-
-
-
-
-
-
120,546
70,319
-
85,387
70,319
85,387
8,567
19,510
12,831
(10,523)
42,012
150,974
238,650
585,423
23,269
92,393
644
2,952
51,451
421,888
244,437 1,677,919
2023
Non-Executive Directors:
M Jackman
M Monro
M Kaplan*
V Papachristos
B York
B Soller
Executive Directors:
J Lorente**
J Bindon***
Other Key Management
Personnel:
J O'Connor****
*
**
***
****
M Kaplan waived his director's fees (including any committee fee to which he is entitled) during the financial year ended 30 June 2023.
Remuneration is from date of appointment as CEO on 1 March 2023 to 30 June 2023.
Remuneration is from 1 July 2022 to date of resignation as a director or key management personnel.
Remuneration is from date of appointment as key management personnel on 22 August 2022 to 30 June 2023.
'Long-term benefits' represent payment of accrued leave entitlements on termination, and movements in accrued long service
and annual leave entitlements.
Total remuneration paid to non-executive directors for the year ending 30 June 2023 amounted to $431,958 (30 June 2022:
$396,676) which is 86.4% (30 June 2022: 79.3%) of the non-executive directors aggregate.
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30 June 2023
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Cash salary
and fees
$
Non-
Cash
bonus monetary
$
$
Super-
annuation
$
Leave
benefits
$
Share-
based
payments
Perform-
ance
rights**
$
Total
$
109,110
49,930
-
77,286
63,659
60,629
-
-
-
-
-
-
-
474,616
-
175,000
-
835,230
-
175,000
-
-
-
-
-
-
-
-
-
-
10,911
4,993
-
7,729
6,366
6,063
-
-
-
-
-
-
-
-
-
-
-
-
120,021
54,923
-
85,015
70,025
66,692
-
25,962
-
18,152
-
-
360,209 1,053,939
-
62,024
-
18,152
-
-
360,209 1,450,615
2022
Non-Executive Directors:
M Jackman
M Monro
M Kaplan*
V Papachristos
B York
B Soller
Executive Directors:
J Lorente
J Bindon
Other Key Management
Personnel:
J O'Connor
*
**
M Kaplan waived his director's fees (including any committee fee to which he is entitled) during the financial year ended 30 June 2022.
The value of the performance rights was determined as the fair value of the performance rights at the grant date. The value disclosed is the portion of the fair value of the rights
recognised as an expense in the reporting period. At 30 June 2022 no performance rights have vested and the actual value is nil.
'Long-term benefits' represent movements in accrued long service leave and annual leave entitlements.
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Name
Executive Directors:
J Lorente
J Bindon
Other Key Management
Personnel:
J O'Connor
Fixed remuneration
2022
2023
2023
At risk - STI
2022
2023
At risk - LTI
2022
71%
58%
-
49%
12%
16%
-
17%
17%
26%
-
34%
77%
-
11%
-
12%
-
The proportion of the cash bonus paid/payable or forfeited is as follows:
Name
Executive Directors:
J Lorente*
J Bindon
Other Key Management
Personnel:
J O'Connor
Maximum STI
$
Actual STI
$
Cash bonus paid/payable
2022
2023
Cash bonus forfeited
2022
2023
70,095
227,250
28,038
95,000
40%
42%
-
77%
60%
56%
-
23%
120,398
48,159
40%
-
60%
-
*
STI is from date of appointment as director on 1 March 2023 to 30 June 2023.
13
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Directors' report
30 June 2023
30 June 2023
Service agreements
Remuneration and other terms of employment for key management personnel are formalised in service agreements. Details
of these agreements are as follows:
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
J Lorente
Managing Director and Chief Executive Officer (appointed 1 March 2023)
1 March 2023
No fixed term
Total fixed employment cost ('TFEC') of $500,000 per annum including statutory
superannuation contributions. Either John or the Company may terminate the
employment contract by giving six months' written notice to the other party. A Short
Term Incentive ('STI') is payable up to 45% of TFEC subject to the achievement of
financial hurdles, principally relating to EBITDA performance, and for the achievement
of personal business objectives.
John O'Connor
Chief Financial Officer and Company Secretary (appointed effective 22 August 2022)
22 August 2022
No fixed term
Total fixed employment cost ('TFEC') of $390,000 per annum including statutory
superannuation contributions. John may terminate his employment contract by giving
three months' written notice to the Company and the Company may terminate the
employment contract by giving three months' written notice to John. A Short Term
Incentive ('STI') is payable up to 36% of TFEC subject to the achievement of financial
hurdles, principally relating to EBITDA performance, and for the achievement of
personal business objectives.
Key management personnel have no entitlement to termination payments in the event of removal for misconduct.
Share-based compensation
Issue of shares
Details of shares issued to directors and other key management personnel as part of compensation during the year ended
30 June 2023 are set out below:
Name
J Bindon
Date
Shares
Issue price
$
2 September 2022
307,147
$2.31
709,510
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and
other key management personnel in this financial year or future reporting years are as follows:
Name
J Lorente
J O'Connor
J Bindon***
Number of
rights
granted Grant date
Measurement
period*
97,511 1 December 2020
66,173 17 December 2021
74,363 14 October 2022
76,098 24 February 2023
204,221 1 December 2020
92,389 17 December 2021
30 June 2023
30 June 2024
30 June 2025
30 June 2025
30 June 2023
30 June 2024
Expiry date**
1 December 2025
17 December 2026
14 October 2027
14 October 2027
1 December 2025
17 December 2026
Fair value
per right
at grant date
$1.312
$1.968
$1.614
$2.028
$1.312
$1.968
*
Measurement period represents the financial year ended date for the measurement of vesting conditions for performance rights. Performance rights vest following confirmation of the
achievement of vesting conditions in August following the end of the measurement period.
The expiry date represents the last possible date that vested performance rights can be converted to shares in the Company if not exercised prior.
**
*** Represents performance rights retained after termination of employment.
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Directors' report
30 June 2023
30 June 2023
Performance rights granted carry no dividend or voting rights. On exercise of rights, the Board will determine at its discretion
whether to settle the exercised rights in shares, cash, or a combination thereof. Performance rights that are not forfeited on
cessation of employment will be retained for testing for vesting at the end of the relevant measurement period.
The number of performance rights over ordinary shares granted to and vested by directors and other key management
personnel as part of compensation during the year ended 30 June 2023 are set out below:
Name
J Lorente*
J Bindon
J O'Connor
Number of
rights
granted
during the
year
2023
Number of
rights
granted
during the
year
2022
Number of
rights
vested
during the
year
2023
Number of
rights
vested
during the
year
2022
-
-
76,098
-
158,381
-
-
307,147
-
-
-
-
*
Rights granted/vested are from date of appointment as CEO on 1 March 2023 to 30 June 2023.
Additional information
The earnings of the Group for the five years to 30 June 2023 are summarised below:
2023
$'000
2022
$'000
2021
$'000
2020
$'000
Sales revenue
EBITDA
Profit after income tax (pre-significant items)
Profit after income tax (statutory)
449,451
51,544
23,188
22,176
409,263
48,040
22,518
21,267
281,382
22,548
7,849
1,817
248,924
17,289
4,660
4,444
*
2019 is pre-AASB 16.
The factors that are considered to affect total shareholders return ('TSR') are summarised below:
2019*
$'000
217,794
9,820
4,358
3,857
2023
2022
2021
2020
2019
Earnings per share pre-significant items (cents
per share)
Earnings per share (statutory) (cents per
share)
27.98
26.76
27.56
26.03
11.15
2.58
7.49
7.14
8.18
7.24
The Board considers the achievement of EPS growth as aligned and a key factor to the creation of shareholder value and
this reinforces the remuneration principles set out in this Remuneration report.
15
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Annual Report 2023 Big River Industries LimitedFinancial Report
Directors’ Report
Big River Industries Limited
Directors' report
30 June 2023
30 June 2023
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the Company held during the financial year by each director and other members of key management
personnel of the Group, including their personally related parties, is set out below:
Ordinary shares
J Lorente*
M Jackman
M Monro
M Kaplan
V Papachristos
B York
B Soller
J Bindon**
J O'Connor
Balance at
the start of
Received
as part of
the year remuneration
Additions
Disposals/
other
Balance at
the end of
the year
171,023
124,830
25,000
-
32,252
-
12,500
533,333
-
898,938
-
-
-
-
-
-
-
307,147
-
307,147
-
10,510
2,104
-
2,716
-
1,052
-
-
16,382
-
-
-
-
-
-
-
(840,480)
-
(840,480)
171,023
135,340
27,104
-
34,968
-
13,552
-
-
381,987
*
**
Balance at the start of the year represents existing holding at date of appointment as a director.
Disposals/other represents the key management personnel is no longer a director or key management personnel during the year, not necessarily a disposal of holding.
Performance rights holding
The number of performance rights over ordinary shares in the Company held during the financial year by each director and
other members of key management personnel of the Group, including their personally related parties, is set out below:
Performance rights over ordinary shares
J Lorente*
J Bindon**
J O'Connor
Balance at
the start of
the year
238,047
688,315
-
926,362
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
76,098
76,098
-
(307,147)
-
(307,147)
-
(381,168)
-
(381,168)
238,047
-
76,098
314,145
*
**
Balance at the start of the year represents existing holding at date of appointment as a director.
Expired/forfeited/other represents no longer a key management personnel, not necessarily a disposal of holding.
This concludes the remuneration report, which has been audited.
Shares under performance rights
Unissued ordinary shares of Big River Industries Limited under performance rights at the date of this report are as follows:
Grant date
1 December 2020
17 December 2021
14 October 2022
24 February 2023
Expiry date
1 December 2025
17 December 2026
14 October 2027
14 October 2027
Number
of rights
483,623
344,743
249,219
76,098
1,153,683
No person entitled to exercise the performance rights had or has any right by virtue of the performance right to participate in
any share issue of the Company or of any other body corporate.
20
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Big River Industries Limited Annual Report 2023Financial Report
Big River Industries Limited
Directors' report
30 June 2023
Shares issued on the exercise of performance rights
The following ordinary shares of Big River Industries Limited were issued during the year ended 30 June 2023 and up to the
date of this report on the exercise of performance rights granted:
Date performance rights granted
28 November 2019
Exercise
Number of
price shares issued
$2.31
677,590
Indemnity and insurance of officers
The Company has indemnified the directors and executives of the Company for costs incurred, in their capacity as a director
or executive, for which they may be held personally liable, except where there is a lack of good faith.
During the financial year, the Company paid a premium in respect of a contract to insure the directors and executives of the
Company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits
disclosure of the nature of the liability and the amount of the premium.
Indemnity and insurance of auditor
The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the
Company or any related entity against a liability incurred by the auditor.
During the financial year, the Company has not paid a premium in respect of a contract to insure the auditor of the Company
or any related entity.
Proceedings on behalf of the Company
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on behalf
of the Company, or to intervene in any proceedings to which the Company is a party for the purpose of taking responsibility
on behalf of the Company for all or part of those proceedings.
Non-audit services
Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor
are outlined in note 33 to the financial statements.
The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another
person or firm on the auditor's behalf), is compatible with the general standard of independence for auditors imposed by the
Corporations Act 2001.
The directors are of the opinion that the services as disclosed in note 33 to the financial statements do not compromise the
external auditor's independence requirements of the Corporations Act 2001 for the following reasons:
●
all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity
of the auditor; and
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code
of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional and
Ethical Standards Board, including reviewing or auditing the auditor's own work, acting in a management or decision-
making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks and rewards.
●
Officers of the Company who are former partners of Deloitte Touche Tohmatsu
There are no officers of the Company who are former partners of Deloitte Touche Tohmatsu.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this directors' report.
Auditor
Deloitte Touche Tohmatsu continues in office in accordance with section 327 of the Corporations Act 2001.
Rounding of amounts
The Company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and
Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that
Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.
17
21
Annual Report 2023 Big River Industries LimitedFinancial Report
Big River Industries Limited
Directors' report
30 June 2023
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act 2001.
On behalf of the directors
___________________________
Malcolm Jackman
Chairman
23 August 2023
Sydney
___________________________
John Lorente
Managing Director and Chief Executive Officer
22
18
Big River Industries Limited Annual Report 2023Financial Report
Auditor’s Independence Declaration
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Quay Quarter Tower
50 Bridge Street
Sydney, NSW, 2000
Australia
Phone: +61 2 9322 7000
www.deloitte.com.au
The Board of Directors
Big River Industries Limited
Trenayr Road
Junction Hill NSW 2460
23 August 2023
Dear Board Members
Auditor’s Independence Declaration to
Big River Industries Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration
of independence to the directors of Big River Industries Limited.
As lead audit partner for the audit of the financial statements of Big River Industries Limited for the financial
year ended 30 June 2023, I declare that to the best of my knowledge and belief, there have been no
contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii) any applicable code of professional conduct in relation to the audit.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
David Haynes
Partner
Chartered Accountants
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte Organisation.
19
23
Annual Report 2023 Big River Industries LimitedFinancial Report Statement of Profit or Loss and Other Comprehensive Income
Big River Industries Limited
Consolidated statement of profit or loss and other comprehensive income
for the year ended 30 June 2023
For the year ended 30 June 2023
Revenue
Other income
Expenses
Raw materials and consumables used
Selling and distribution expense
Employee benefits expense
Occupancy expense
General and administration expense
Acquisition costs
Depreciation and amortisation expense
Impairment of receivables
Recovery of assets and restructuring costs
Finance costs
Profit before income tax expense
Income tax expense
Profit after income tax expense for the year attributable to the owners of Big
River Industries Limited
Other comprehensive income/(loss)
Items that may be reclassified subsequently to profit or loss
Net change in the fair value of cash flow hedges taken to equity, net of tax
Foreign currency translation
Other comprehensive income/(loss) for the year, net of tax
Total comprehensive income for the year attributable to the owners of Big River
Industries Limited
Note
2023
$'000
Group
2022
$'000
5
6
7
7
7
7
11
8
7
9
28
449,451
409,263
95
62
(326,157)
(7,318)
(45,353)
(4,415)
(13,777)
(561)
(13,849)
(1,568)
-
(4,793)
(299,247)
(6,993)
(38,785)
(3,944)
(10,600)
(1,020)
(12,240)
(2,625)
709
(3,224)
31,755
31,356
(9,579)
(10,089)
22,176
21,267
236
436
672
-
(764)
(764)
22,848
20,503
Cents
Cents
Basic earnings per share
Diluted earnings per share
41
41
26.76
26.34
26.03
25.51
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
20
24
Big River Industries Limited Annual Report 2023Financial Report
Statement of Financial Position
Big River Industries Limited
Consolidated statement of financial position
as at 30 June 2023
As at 30 June 2023
Note
2023
$'000
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Financial assets
Derivative financial instruments
Other assets
Non-current assets classified as held for sale
Total current assets
Non-current assets
Derivative financial instruments
Property, plant and equipment
Right-of-use assets
Intangibles
Deferred tax
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Borrowings
Lease liabilities
Income tax
Provisions
Contingent consideration
Other liabilities
Total current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Deferred tax
Provisions
Contingent consideration
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Retained profits
Total equity
Group
2022
$'000
19,796
63,414
72,815
113
-
499
156,637
2,701
159,338
-
21,944
21,511
58,427
21
101,903
34,291
59,918
69,539
226
61
962
164,997
-
164,997
174
23,851
25,510
60,767
298
110,600
275,597
261,241
59,666
2,618
8,576
5,398
7,369
3,602
2,324
89,553
41,000
20,228
794
1,111
2,200
65,333
61,881
2,538
7,794
5,290
6,938
3,513
2,324
90,278
36,000
17,432
-
756
4,355
58,543
154,886
148,821
120,711
112,420
10
11
12
13
14
15
16
14
17
18
19
9
20
21
22
9
23
24
25
21
22
9
23
24
26
27
28
98,517
24
22,170
96,665
331
15,424
120,711
112,420
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
21
25
Annual Report 2023 Big River Industries LimitedFinancial Report
Statement of Changes in Equity
Big River Industries Limited
Consolidated statement of changes in equity
for the year ended 30 June 2023
For the year ended 30 June 2023
Group
Foreign
currency
translation
reserve
$'000
Hedging
reserve -
cash flow
hedges
$'000
Share-based
payments
reserve
$'000
Issued
capital
$'000
Retained
profits
$'000
Total equity
$'000
Balance at 1 July 2021
93,409
(419)
Profit after income tax expense
for the year
Other comprehensive loss for
the year, net of tax
Total comprehensive
income/(loss) for the year
Transactions with owners in
their capacity as owners:
Contributions of equity, net of
transaction costs (note 26)
Share-based payments (note
42)
Dividends paid (note 29)
-
-
-
3,256
-
-
-
(764)
(764)
-
-
-
Balance at 30 June 2022
96,665
(1,183)
-
-
-
-
-
-
-
-
605
1,096
94,691
-
-
-
-
21,267
21,267
-
(764)
21,267
20,503
-
3,256
909
-
-
(6,939)
909
(6,939)
1,514
15,424
112,420
Group
Foreign
currency
translation
reserve
$'000
Hedging
reserve -
cash flow
hedges
$'000
Share-based
payments
reserve
$'000
Issued
capital
$'000
Retained
profits
$'000
Total equity
$'000
Balance at 1 July 2022
96,665
(1,183)
Profit after income tax expense
for the year
Other comprehensive income
for the year, net of tax
Total comprehensive income for
the year
Transactions with owners in
their capacity as owners:
Contributions of equity, net of
transaction costs (note 26)
Share-based payments (note
42)
Vesting of performance rights
Dividends paid (note 29)
-
-
-
287
-
1,565
-
-
-
236
-
436
436
236
-
-
-
-
-
-
-
-
1,514
15,424
112,420
-
-
-
-
22,176
22,176
-
672
22,176
22,848
-
287
586
(1,565)
-
-
-
(15,430)
586
-
(15,430)
Balance at 30 June 2023
98,517
(747)
236
535
22,170
120,711
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
22
26
Big River Industries Limited Annual Report 2023Financial Report
Statement of Cash Flows
Big River Industries Limited
Consolidated statement of cash flows
for the year ended 30 June 2023
For the year ended 30 June 2023
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Government grant
Interest and other finance costs paid
Income taxes paid
Note
2023
$'000
Group
2022
$'000
497,811
(441,162)
434,762
(397,294)
56,649
1,000
(3,105)
(9,299)
37,468
5,000
(2,446)
(2,862)
Net cash from operating activities
40
45,245
37,160
Cash flows from investing activities
Payment for acquisition of businesses
Payments for investments
Payments for property, plant and equipment, net of lease finance
Payments for intangibles
Payments of deferred consideration
Proceeds from disposal of held for sale asset
Proceeds from disposal of property, plant and equipment
Net cash used in investing activities
Cash flows from financing activities
Share issue transaction costs
Proceeds from borrowings
Net lease repayments
Dividends paid, net of reinvestment plan
Net cash used in financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effects of exchange rate changes on cash and cash equivalents
37
13
17
19
24
29
(5,594)
(113)
(4,342)
-
(3,641)
2,701
206
(13,455)
(113)
(6,065)
(164)
(2,022)
-
154
(10,783)
(21,665)
-
5,000
(9,914)
(15,143)
(10)
10,000
(7,850)
(6,700)
(20,057)
(4,560)
14,405
17,258
10
10,935
6,447
(124)
Cash and cash equivalents at the end of the financial year
10
31,673
17,258
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
23
27
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 1. General information
The financial statements cover Big River Industries Limited as a Group consisting of Big River Industries Limited ('Company'
or 'parent entity') and the entities it controlled at the end of, or during, the year ('Group'). The financial statements are
presented in Australian dollars, which is Big River Industries Limited's functional and presentation currency.
Big River Industries Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its
registered office and principal place of business is:
Trenayr Road
Junction Hill NSW 2460
A description of the nature of the Group's operations and its principal activities are included in the directors' report, which is
not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of directors, on 23 August 2023. The
directors have the power to amend and reissue the financial statements.
Note 2. Significant accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
New or amended Accounting Standards and Interpretations adopted
The Group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board ('AASB') that are mandatory for the current reporting period. The adoption of these Accounting
Standards and Interpretations did not have any significant impact on the financial performance or position of the Group.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as appropriate
for for-profit oriented entities. These financial statements also comply with International Financial Reporting Standards as
issued by the International Accounting Standards Board ('IASB').
Historical cost convention
The financial statements have been prepared under the historical cost convention, except for, where applicable, the
revaluation of financial assets and liabilities at fair value through profit or loss.
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial
statements, are disclosed in note 3.
Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the Group only.
Supplementary information about the parent entity is disclosed in note 36.
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Big River Industries Limited
as at 30 June 2023 and the results of all subsidiaries for the year then ended.
Subsidiaries are all those entities over which the Group has control. The Group controls an entity when the Group is exposed
to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its
power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to
the Group. They are de-consolidated from the date that control ceases.
28
24
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by
the Group.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest,
without the loss of control, is accounted for as an equity transaction, where the difference between the consideration
transferred and the book value of the share of the non-controlling interest acquired is recognised directly in equity attributable
to the parent.
Where the Group loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-controlling
interest in the subsidiary together with any cumulative translation differences recognised in equity. The Group recognises
the fair value of the consideration received and the fair value of any investment retained together with any gain or loss in
profit or loss.
Operating segments
Operating segments are presented using the 'management approach', where the information presented is on the same basis
as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the allocation
of resources to operating segments and assessing their performance.
Foreign currency translation
The financial statements are presented in Australian dollars, which is Big River Industries Limited's functional and
presentation currency.
Foreign currency transactions
Foreign currency transactions are translated into the Company's functional currency using the exchange rates prevailing at
the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from
the translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in profit or loss.
Foreign operations
The assets and liabilities of foreign operations are translated into the functional currency using the exchange rates at the
reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average
exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange
differences are recognised in other comprehensive income through the foreign currency reserve in equity.
The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of.
Revenue recognition
The Group recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the Group is expected to be entitled in exchange
for transferring goods or services to a customer. For each contract with a customer, the Group: identifies the contract with a
customer; identifies the performance obligations in the contract; determines the transaction price which takes into account
estimates of variable consideration and the time value of money; allocates the transaction price to the separate performance
obligations on the basis of the relative stand-alone selling price of each distinct good or service to be delivered; and
recognises revenue when or as each performance obligation is satisfied in a manner that depicts the transfer to the customer
of the goods or services promised.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as discounts,
rebates and refunds, any potential bonuses receivable from the customer and any other contingent events. Such estimates
are determined using either the 'expected value' or 'most likely amount' method. The measurement of variable consideration
is subject to a constraining principle whereby revenue will only be recognised to the extent that it is highly probable that a
significant reversal in the amount of cumulative revenue recognised will not occur. The measurement constraint continues
until the uncertainty associated with the variable consideration is subsequently resolved. Amounts received that are subject
to the constraining principle are recognised as a refund liability.
25
29
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Sale of goods
Sale of goods revenue is recognised at the point in time when the performance obligation has been satisfied, which is when
the customer obtains control of the goods, which is generally at the time of delivery.
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest rate,
which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to the
net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
Government grant
Grants from the government are recognised at their fair value when there is reasonable assurance that the grant will be
received and that the Group will comply with all attached conditions. Government grants relating to costs are deferred and
recognised in profit or loss over the periods necessary to match them with the costs that they are intended to compensate.
Income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the applicable
income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to temporary
differences, unused tax losses and the adjustment recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when the
assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted, except for:
When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a
●
transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting nor
taxable profits; or
When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and the
timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the foreseeable
future.
●
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred tax
assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for the
carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is probable
that there are future taxable profits available to recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets against
current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable authority on
either the same taxable entity or different taxable entities which intend to settle simultaneously.
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the Group's
normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after the
reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability
for at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the Group's normal operating cycle; it is held
primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities
are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
30
26
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value. For the statement of cash flows presentation purposes, cash
and cash equivalents also includes bank overdrafts, which are shown within borrowings in current liabilities on the statement
of financial position.
Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective
interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within 30
days.
The Group has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss
allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
Inventories
Raw materials, work in progress and finished goods are stated at the lower of cost and net realisable value on a 'weighted
average' basis. Cost comprises of direct materials and delivery costs, direct labour, import duties and other taxes, an
appropriate proportion of variable and fixed overhead expenditure based on normal operating capacity. Costs of purchased
inventory are determined after deducting rebates and discounts received or receivable.
Stock on hand is stated at the lower of cost and net realisable value. Cost comprises of purchase and delivery costs, net of
rebates and discounts received or receivable.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion
and the estimated costs necessary to make the sale.
Derivative financial instruments
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently
remeasured to their fair value at each reporting date. The accounting for subsequent changes in fair value depends on
whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged.
Derivatives are classified as current or non-current depending on the expected period of realisation.
Cash flow hedges
Cash flow hedges are used to cover the Group's exposure to variability in cash flows that is attributable to particular risks
associated with a recognised asset or liability or a firm commitment which could affect profit or loss. The effective portion of
changes in the fair value of derivatives and other qualifying hedging instruments that are designated and qualify as cash flow
hedges is recognised in other comprehensive income and accumulated under the heading of cash flow hedging reserve,
limited to the cumulative change in fair value of the hedged item from inception of the hedge. The gain or loss relating to the
ineffective portion is recognised immediately in profit or loss, and is included in the ‘other gains and losses’ line item.
Amounts previously recognised in other comprehensive income and accumulated in equity are reclassified to profit or loss
in the periods when the hedged item affects profit or loss, in the same line as the recognised hedged item. However, when
the hedged forecast transaction results in the recognition of a non-financial asset or a non-financial liability, the gains and
losses previously recognised in other comprehensive income and accumulated in equity are removed from equity and
included in the initial measurement of the cost of the non-financial asset or non-financial liability. This transfer does not affect
other comprehensive income. Furthermore, if the Group expects that some or all of the loss accumulated in the cash flow
hedging reserve will not be recovered in the future, that amount is immediately reclassified to profit or loss.
The Group discontinues hedge accounting only when the hedging relationship (or a part thereof) ceases to meet the
qualifying criteria (after rebalancing, if applicable). This includes instances when the hedging instrument expires or is sold,
terminated or exercised. The discontinuation is accounted for prospectively. Any gain or loss recognised in other
comprehensive income and accumulated in cash flow hedge reserve at that time remains in equity and is reclassified to profit
or loss when the forecast transaction occurs. When a forecast transaction is no longer expected to occur, the gain or loss
accumulated in the cash flow hedge reserve is reclassified immediately to profit or loss.
27
31
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Non-current assets or disposal groups classified as held for sale
Non-current assets and assets of disposal groups are classified as held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through continued use. They are measured at the lower of their carrying
amount and fair value less costs of disposal. For non-current assets or assets of disposal groups to be classified as held for
sale, they must be available for immediate sale in their present condition and their sale must be highly probable.
An impairment loss is recognised for any initial or subsequent write down of the non-current assets and assets of disposal
groups to fair value less costs of disposal. A gain is recognised for any subsequent increases in fair value less costs of
disposal of a non-current assets and assets of disposal groups, but not in excess of any cumulative impairment loss
previously recognised.
Non-current assets are not depreciated or amortised while they are classified as held for sale. Interest and other expenses
attributable to the liabilities of assets held for sale continue to be recognised.
Non-current assets classified as held for sale and the assets of disposal groups classified as held for sale are presented
separately on the face of the statement of financial position, in current assets. The liabilities of disposal groups classified as
held for sale are presented separately on the face of the statement of financial position, in current liabilities.
Investments and other financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the initial
measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured at
either amortised cost or fair value depending on their classification. Classification is determined based on both the business
model within which such assets are held and the contractual cash flow characteristics of the financial asset unless an
accounting mismatch is being avoided.
Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the
Group has transferred substantially all the risks and rewards of ownership. When there is no reasonable expectation of
recovering part or all of a financial asset, its carrying value is written off.
Financial assets at amortised cost
A financial asset is measured at amortised cost only if both of the following conditions are met: (i) it is held within a business
model whose objective is to hold assets in order to collect contractual cash flows; and (ii) the contractual terms of the financial
asset represent contractual cash flows that are solely payments of principal and interest.
Impairment of financial assets
The Group recognises a loss allowance for expected credit losses on financial assets which are either measured at amortised
cost or fair value through other comprehensive income. The measurement of the loss allowance depends upon the Group's
assessment at the end of each reporting period as to whether the financial instrument's credit risk has increased significantly
since initial recognition, based on reasonable and supportable information that is available, without undue cost or effort to
obtain.
Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected credit
loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable to a
default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where it is
determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected credit
losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present value of
anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.
For financial assets mandatorily measured at fair value through other comprehensive income, the loss allowance is
recognised in other comprehensive income with a corresponding expense through profit or loss. In all other cases, the loss
allowance reduces the asset's carrying value with a corresponding expense through profit or loss.
Property, plant and equipment
Property, plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost
includes expenditure that is directly attributable to the acquisition of the items. The cost of fixed assets constructed within the
Group includes the cost of materials, direct labour, borrowing costs and an appropriate proportion of fixed and variable
overhead.
32
28
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Depreciation is calculated on a straight-line basis to write off the net cost of each item of property, plant and equipment
(excluding land) over their expected useful lives as follows:
Buildings
Plant and equipment
25 to 40 years
3 to 25 years
Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful life of the
improvements, whichever is shorter.
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting date.
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the
Group. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which
comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the
commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the
cost of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and
restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful
life of the asset, whichever is the shorter. Where the Group expects to obtain ownership of the leased asset at the end of the
lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for
any remeasurement of lease liabilities.
The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases with terms
of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as
incurred.
Intangible assets
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value at
the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Finite life intangible assets
are subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit or loss
arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds and the
carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed annually.
Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the amortisation
method or period.
Goodwill
Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested annually for impairment,
or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less
accumulated impairment losses. Impairment losses on goodwill are taken to profit or loss and are not subsequently reversed.
Customer relationships
Customer relationships acquired in a business combination are amortised on a straight-line basis over the period of their
expected benefit, being their finite life of up to 7 years.
Software
Significant costs associated with software are deferred and amortised on a straight-line basis over the period of their expected
benefit, being their finite life of up to 7 years.
Product development
Product development has a finite useful life and is carried at cost less accumulated amortisation. Amortisation is calculated
using the straight-line method to allocate the cost over the useful life of up to 8 years.
29
33
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Brands
Brands acquired in a business combination are not amortised on the basis that it has an indefinite life. Management considers
that the useful life of brands is indefinite because there is no foreseeable limit to the cash flows this asset can generate. This
is reassessed every year. Instead, it is tested annually for impairment, or more frequently if events or changes in
circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses.
Impairment of non-financial assets
Goodwill is not subject to amortisation and is tested annually for impairment, or more frequently if events or changes in
circumstances indicate that they might be impaired. Other non-financial assets are reviewed for impairment whenever events
or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for
the amount by which the asset's carrying amount exceeds its recoverable amount.
Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the
present value of the estimated future cash flows relating to the asset using a post-tax discount rate specific to the asset or
cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to
form a cash-generating unit.
Trade and other payables
Trade and other payables represent liabilities for goods and services provided to the Group prior to the end of the financial
year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The
amounts are unsecured and are usually paid within 30 days of recognition.
Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They
are subsequently measured at amortised cost using the effective interest method.
Lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present
value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or,
if that rate cannot be readily determined, the Group's incremental borrowing rate. Lease payments comprise of fixed
payments less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected
to be paid under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably
certain to occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or
a rate are expensed in the period in which they are incurred.
Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are remeasured
if there is a change in the following: future lease payments arising from a change in an index or a rate used; residual
guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability is remeasured, an
adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of the right-of-use asset
is fully written down.
Finance costs
Finance costs are expensed in the period in which they are incurred.
Provisions
Provisions are recognised when the Group has a present (legal or constructive) obligation as a result of a past event, it is
probable the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the
obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present
obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value of
money is material, provisions are discounted using a current pre-tax rate specific to the liability. The increase in the provision
resulting from the passage of time is recognised as a finance cost.
Employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be
settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities
are settled.
34
30
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are
measured at the present value of expected future payments to be made in respect of services provided by employees up to
the reporting date. Consideration is given to expected future wage and salary levels, experience of employee departures and
periods of service. Expected future payments are discounted using market yields at the reporting date on high-quality
corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
Defined contribution superannuation expense
Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred.
Share-based payments
Equity-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or rights over shares, that are provided to employees in exchange for the
rendering of services.
The cost of equity-settled transactions are measured at fair value on grant date. Fair value is determined using either the
Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the impact
of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and
the risk free interest rate for the term of the option, together with non-vesting conditions that do not determine whether the
Group receives the services that entitle the employees to receive payment. No account is taken of any other vesting
conditions.
The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the vesting
period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the best estimate
of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognised in profit
or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognised in previous
periods.
Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to market conditions
are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are
satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made. An
additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair value
of the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is treated as a
cancellation. If the condition is not within the control of the Group or employee and is not satisfied during the vesting period,
any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense
is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and new award
is treated as if they were a modification.
Fair value measurement
When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair
value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date; and assumes that the transaction will take place either: in the principal
market; or in the absence of a principal market, in the most advantageous market.
Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming
they act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and
best use. Valuation techniques used to measure fair value are those that are appropriate in the circumstances and which
maximise the use of relevant observable inputs and minimise the use of unobservable inputs.
31
35
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and transfers
between levels are determined based on a reassessment of the lowest level of input that is significant to the fair value
measurement.
For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not
available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and
reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is
undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where
applicable, with external sources of data.
Issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax,
from the proceeds.
Dividends
Dividends are recognised when declared during the financial year and no longer at the discretion of the Company.
Business combinations
The acquisition method of accounting is used to account for business combinations regardless of whether equity instruments
or other assets are acquired.
The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity instruments
issued or liabilities incurred by the acquirer to former owners of the acquiree and the amount of any non-controlling interest
in the acquiree. For each business combination, the non-controlling interest in the acquiree is measured at either fair value
or at the proportionate share of the acquiree's identifiable net assets. All acquisition costs are expensed as incurred to profit
or loss.
On the acquisition of a business, the Group assesses the financial assets acquired and liabilities assumed for appropriate
classification and designation in accordance with the contractual terms, economic conditions, the Group's operating or
accounting policies and other pertinent conditions in existence at the acquisition-date.
Where the business combination is achieved in stages, the Group remeasures its previously held equity interest in the
acquiree at the acquisition-date fair value and the difference between the fair value and the previous carrying amount is
recognised in profit or loss.
Contingent consideration to be transferred by the acquirer is recognised at the acquisition-date fair value. Subsequent
changes in the fair value of the contingent consideration classified as an asset or liability is recognised in profit or loss.
Contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity.
The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-controlling interest
in the acquiree and the fair value of the consideration transferred and the fair value of any pre-existing investment in the
acquiree is recognised as goodwill. If the consideration transferred and the pre-existing fair value is less than the fair value
of the identifiable net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a gain directly
in profit or loss by the acquirer on the acquisition-date, but only after a reassessment of the identification and measurement
of the net assets acquired, the non-controlling interest in the acquiree, if any, the consideration transferred and the acquirer's
previously held equity interest in the acquirer.
Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional
amounts recognised and also recognises additional assets or liabilities during the measurement period, based on new
information obtained about the facts and circumstances that existed at the acquisition-date. The measurement period ends
on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information
possible to determine fair value.
36
32
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 2. Significant accounting policies (continued)
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Big River Industries Limited,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted
average number of additional ordinary shares that would have been outstanding assuming conversion of all dilutive potential
ordinary shares.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part of
the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST
recoverable from, or payable to, the tax authority is included in other receivables or other payables in the statement of
financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to the tax authority, are presented as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority.
Comparatives
Certain comparatives have been reclassified to align with current year disclosure. There has been no change to net assets,
equity or profit for the year of any reclassification.
Rounding of amounts
The Company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities and
Investments Commission, relating to 'rounding-off'. Amounts in this report have been rounded off in accordance with that
Corporations Instrument to the nearest thousand dollars, or in certain cases, the nearest dollar.
New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet mandatory,
have not been early adopted by the Group for the annual reporting period ended 30 June 2023. The Group has not yet
assessed the impact of these new or amended Accounting Standards and Interpretations.
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in
relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates and
assumptions on historical experience and on other various factors, including expectations of future events, management
believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will seldom equal
the related actual results. The judgements, estimates and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next financial year are
discussed below.
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a degree of estimation and judgement. It is based on the
lifetime expected credit loss, grouped based on days overdue, and makes assumptions to allocate an overall expected credit
loss rate for each group. These assumptions include recent sales experience and historical collection rates.
33
37
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 3. Critical accounting judgements, estimates and assumptions (continued)
Goodwill
The Group tests annually, or more frequently if events or changes in circumstances indicate impairment, whether goodwill
has suffered any impairment, in accordance with the accounting policy stated in note 2. The recoverable amounts of cash-
generating units have been determined based on value-in-use calculations. These calculations require the use of
assumptions, including estimated discount rates based on the current cost of capital and growth rates of the estimated future
cash flows.
Impairment of non-financial assets other than goodwill
The Group assesses impairment of non-financial assets other than goodwill at each reporting date by evaluating conditions
specific to the Group and to the particular asset that may lead to impairment. If an impairment trigger exists, the recoverable
amount of the asset is determined. This involves fair value less costs of disposal or value-in-use calculations, which
incorporate a number of key estimates and assumptions.
Lease term
The lease term is a significant component in the measurement of both the right-of-use asset and lease liability. Judgement
is exercised in determining whether there is reasonable certainty that an option to extend the lease or purchase the underlying
asset will be exercised, or an option to terminate the lease will not be exercised, when ascertaining the periods to be included
in the lease term. In determining the lease term, all facts and circumstances that create an economical incentive to exercise
an extension option, or not to exercise a termination option, are considered at the lease commencement date. Factors
considered may include the importance of the asset to the Group's operations; comparison of terms and conditions to
prevailing market rates; incurrence of significant penalties; existence of significant leasehold improvements; and the costs
and disruption to replace the asset. The Group reassesses whether it is reasonably certain to exercise an extension option,
or not exercise a termination option, if there is a significant event or significant change in circumstances.
Incremental borrowing rate
Where the interest rate implicit in a lease cannot be readily determined, an incremental borrowing rate is estimated to discount
future lease payments to measure the present value of the lease liability at the lease commencement date. Such a rate is
based on what the Group estimates it would have to pay a third party to borrow the funds necessary to obtain an asset of a
similar value to the right-of-use asset, with similar terms, security and economic environment.
Note 4. Operating segments
Identification of reportable operating segments
The directors have identified the Group's operating segments based on the internal reports that are reviewed and used by
the Chief Executive Officer (the chief operating decision maker) in assessing performance and in determining the allocation
of resources. Discrete financial information about these operating segments is reported on at least a monthly basis.
The information reported to the Chief Executive Officer is aggregated based on product types and nature of the underlying
activities which the Group operates. The Group’s reportable segments are as follows:
Panels
Construction
Comprised of three manufacturing and six distribution sites of timber panel products in
Australia and New Zealand
Comprised of seventeen sites which sell building, commercial and formwork products in
Australia
Sales between segments are based on similar terms and conditions to those in place with third party customers and are
eliminated from the results below.
The directors consider Revenue and EBITDA* as the Group's key segment measures.
EBITDA* is measured pre significant items which are presented separately due to their nature, size and expected infrequent
occurrence and therefore do not reflect the underlying trading of the Group.
38
34
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 4. Operating segments (continued)
Operating segment information
Group - 2023
Revenue
Sales to external customers
Total revenue
EBITDA* (pre significant items)
Depreciation and amortisation
Finance costs
Significant items
Profit before income tax expense
Income tax expense
Profit after income tax expense
Group - 2022
Revenue
Sales to external customers
Total revenue
EBITDA* (pre significant items)
Depreciation and amortisation
Finance costs
Significant items
Profit before income tax expense
Income tax expense
Profit after income tax expense
Geographical information
Australia
New Zealand
Corporate
Panels Construction (unallocated)
$'000
$'000
$'000
Total
$'000
128,456
128,456
320,995
320,995
-
-
449,451
449,451
19,176
39,345
(6,977)
Corporate
Panels Construction (unallocated)
$'000
$'000
$'000
51,544
(13,849)
(4,793)
(1,147)
31,755
(9,579)
22,176
Total
$'000
117,100
117,100
292,163
292,163
-
-
409,263
409,263
21,400
31,900
(5,260)
48,040
(12,240)
(3,224)
(1,220)
31,356
(10,089)
21,267
Revenue from external
customers
2022
$'000
2023
$'000
Geographical non-current
assets
2022
$'000
2023
$'000
416,380
33,071
376,329
32,934
92,797
17,505
83,660
18,222
449,451
409,263
110,302
101,882
There is no single customer with 10% or more of revenue.
The geographical non-current assets above are exclusive of deferred tax assets.
*
EBITDA is net profit before interest, taxes, depreciation, amortisation and significant costs which are share-based remuneration, acquisition costs and restructuring costs.
35
39
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 5. Revenue
Sale of goods
2023
$'000
Group
2022
$'000
449,451
409,263
Disaggregation of revenue
Disaggregation of revenue is disclosed in note 4. All of the Group's revenue is recognised at a point in time.
Note 6. Other income
Net gain on disposal of property, plant and equipment
2023
$'000
95
Group
2022
$'000
62
40
36
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 7. Expenses
Profit before income tax includes the following specific expenses:
Cost of sales
Cost of sales
Depreciation
Buildings
Plant and equipment
Plant and equipment under lease
Buildings right-of-use assets
Total depreciation
Amortisation
Customer relationships
Software
Product development
Total amortisation
Total depreciation and amortisation
Employee benefits expense
Salaries and wages (including annual leave and long service leave)
Superannuation
Share-based remuneration
Total employee benefits expense
Finance costs
Interest and finance charges paid/payable on borrowings
Interest and finance charges paid/payable on lease liabilities
Unwind of interest on contingent consideration
Finance costs expensed
Expenses associated with business combinations
Acquisition costs
Note 8. Recovery of assets and restructuring costs
Buildings (note 17)
Site restoration cost provision
Redundancy costs
Tax benefit
Net impact after tax
2023
$'000
Group
2022
$'000
326,157
299,247
62
2,671
498
8,204
163
2,565
584
7,490
11,435
10,802
2,092
298
24
1,116
286
36
2,414
1,438
13,849
12,240
40,901
3,866
586
34,719
3,157
909
45,353
38,785
3,105
966
722
1,661
784
779
4,793
3,224
561
1,020
2023
$'000
-
-
-
-
-
-
Group
2022
$'000
(316)
(338)
(55)
(709)
213
(496)
37
41
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 9. Income tax
Income tax expense
Current tax
Deferred tax - origination and reversal of temporary differences
Adjustment recognised for prior periods (current tax)
Aggregate income tax expense
Numerical reconciliation of income tax expense and tax at the statutory rate
Profit before income tax expense
Tax at the statutory tax rate of 30%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Share-based remuneration
Sundry items
Adjustment recognised for prior periods (current tax)
Difference in overseas tax rates
Income tax expense
2023
$'000
9,504
191
(116)
Group
2022
$'000
7,128
2,987
(26)
9,579
10,089
31,755
31,356
9,527
9,407
176
65
9,768
(116)
(73)
273
541
10,221
(26)
(106)
9,579
10,089
The standard rate of corporation tax applied to taxable profit is 30% (30 June 2022: 30%). Taxation for other jurisdictions is
calculated at the rates prevailing in the respective jurisdictions.
Deferred tax asset
Deferred tax asset comprises temporary differences attributable to:
Allowance for expected credit losses
Employee benefits
Leases
Capital raise expenses
Rehabilitation provision
Other provisions and accruals
Less: offset*
Deferred tax asset
2023
$'000
Group
2022
$'000
1,047
2,402
8,092
191
-
1,452
1,038
2,339
6,705
318
20
1,236
13,184
11,656
(12,886)
(11,635)
298
21
42
38
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 9. Income tax (continued)
Deferred tax liability
Deferred tax liability comprises temporary differences attributable to:
Property, plant and equipment
Right-of-use assets
Customer relationships
Brand
Present value on contingent consideration
Less: offset*
Deferred tax liability
*
Deferred tax balances are not fully offset at 30 June 2023 as they do not relate to the same taxable authority.
Reconciliation in movement of deferred tax asset/(liability)
Balance at beginning of the year
Less: Balance at end of the year
Movement during the year
Recognised in profit or loss
Recognised in goodwill (note 37)
Exchange differences
Income tax payable
Current tax payable
2023
$'000
Group
2022
$'000
2,319
7,687
2,735
849
90
1,290
6,342
2,847
849
307
13,680
11,635
(12,886)
(11,635)
794
-
2023
$'000
21
(496)
Group
2022
$'000
5,076
21
517
5,055
191
330
(4)
517
2023
$'000
2,987
2,021
47
5,055
Group
2022
$'000
5,398
5,290
39
43
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 10. Cash and cash equivalents
Current assets
Cash on hand
Cash at bank
Reconciliation to cash and cash equivalents at the end of the financial year
The above figures are reconciled to cash and cash equivalents at the end of the financial
year as shown in the statement of cash flows as follows:
Balances as above
Bank overdraft and trade finance (note 21)
Balance as per statement of cash flows
Note 11. Trade and other receivables
Current assets
Trade receivables
Less: Allowance for expected credit losses
Other receivables
Government grant
2023
$'000
Group
2022
$'000
5,442
28,849
3,087
16,709
34,291
19,796
34,291
(2,618)
19,796
(2,538)
31,673
17,258
2023
$'000
60,031
(3,507)
56,524
3,394
-
Group
2022
$'000
63,671
(3,542)
60,129
2,285
1,000
59,918
63,414
The ageing of the trade receivables and allowance for expected credit losses provided for above are as follows:
Group
Not overdue
0 to 3 months overdue
Over 3 months overdue
Expected credit loss rate
2022
%
2023
%
Carrying amount
2022
$'000
2023
$'000
Allowance for expected
credit losses
2022
$'000
2023
$'000
1.49%
3.92%
62.17%
0.19%
5.76%
62.36%
36,339
20,195
3,497
39,237
20,794
3,640
541
792
2,174
75
1,197
2,270
60,031
63,671
3,507
3,542
Debtors are written off when the cash is no longer considered collectable. The Group has insurance policies over a portion
of long standing debt which limits its credit risk, and is taking into consideration when determining expected credit loss rate.
The impact of expected credit losses in other receivables is immaterial.
The average credit period on sale of goods is 45 days. No interest is charged on outstanding trade receivables.
44
40
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 11. Trade and other receivables (continued)
The movements in the allowance for expected credit losses in respect of trade receivables during the year was as follows:
Opening balance
Additional provisions recognised
Receivables written off during the year as uncollectable
Closing balance
Note 12. Inventories
Current assets
Raw materials and work in progress - at cost
Finished goods - at cost
Less: Provision for stock obsolescence
Note 13. Financial assets
Current assets
TradeNET Solutions Ltd
Reconciliation
Reconciliation of the fair values at the beginning and end of the current and previous
financial year are set out below:
Opening fair value
Additions
Closing fair value
Refer to note 31 for further information on fair value measurement.
2023
$'000
3,542
1,568
(1,603)
Group
2022
$'000
2,154
2,625
(1,237)
3,507
3,542
2023
$'000
Group
2022
$'000
1,416
70,339
(2,216)
2,533
73,088
(2,806)
69,539
72,815
2023
$'000
Group
2022
$'000
226
113
113
113
226
-
113
113
41
45
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 14. Derivative financial instruments
Current assets
Forward foreign exchange contracts - cash flow hedges
Non-current assets
Forward foreign exchange contracts - cash flow hedges
Refer to note 31 for further information on fair value measurement.
Note 15. Other assets
Current assets
Prepayments
Other deposits
Note 16. Non-current assets classified as held for sale
2023
$'000
61
174
2023
$'000
830
132
962
2023
$'000
Group
2022
$'000
-
-
Group
2022
$'000
363
136
499
Group
2022
$'000
Current assets
Buildings
-
2,701
The Company entered into a sale agreement for the land and buildings at its Wagga site in connection with the consolidation
project described in note 8. The sale completed in FY2023.
Note 17. Property, plant and equipment
Non-current assets
Freehold land - at cost
Buildings - at cost
Less: Accumulated depreciation
Plant and equipment - at cost
Less: Accumulated depreciation
Capital work-in-progress - at cost
46
42
2023
$'000
Group
2022
$'000
856
856
5,597
(1,599)
3,998
41,189
(23,352)
17,837
2,271
(1,537)
734
36,141
(20,499)
15,642
1,160
4,712
23,851
21,944
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 17. Property, plant and equipment (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Group
Balance at 1 July 2021
Additions
Additions through business
combinations (note 37)
Classified as held for sale (note
16)
Disposals
Exchange differences
Recovery of assets
Transfers in/(out)
Depreciation expense
Balance at 30 June 2022
Additions
Additions through business
combinations (note 37)
Disposals
Exchange differences
Transfers in/(out)
Depreciation expense
Freehold
land
$'000
Buildings
$'000
Plant and
equipment
$'000
Plant and
equipment
under
lease
$'000
Capital work-
in-
progress
$'000
856
-
3,293
-
13,683
941
2,449
961
549
4,163
-
-
-
-
-
-
-
856
-
-
-
-
-
-
-
934
(2,701)
(11)
-
316
-
(163)
734
-
-
-
-
3,326
(62)
-
(141)
(26)
-
239
(2,565)
13,065
1,568
580
(111)
16
3,589
(2,671)
-
-
(10)
-
-
(239)
(584)
2,577
278
-
-
-
(556)
(498)
-
-
-
-
-
-
-
4,712
2,807
-
-
-
(6,359)
-
Total
$'000
20,830
6,065
934
(2,701)
(162)
(26)
316
-
(3,312)
21,944
4,653
580
(111)
16
-
(3,231)
Balance at 30 June 2023
856
3,998
16,036
1,801
1,160
23,851
Note 18. Right-of-use assets
Non-current assets
Buildings - right-of-use
Less: Accumulated depreciation
2023
$'000
Group
2022
$'000
42,547
(17,037)
37,021
(15,510)
25,510
21,511
The Group leases land and buildings for its offices, warehouses and retail outlets under agreements of between 2 to 10 years
with, in some cases, options to extend. The leases have various escalation clauses. On renewal, the terms of the leases are
renegotiated.
43
47
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 18. Right-of-use assets (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Buildings -
right-of-use
$'000
22,510
154
6,507
(170)
(7,490)
21,511
1,166
1,094
9,842
101
(8,204)
25,510
2023
$'000
Group
2022
$'000
47,547
44,497
12,787
(3,735)
9,052
2,082
(898)
1,184
191
(118)
73
13,237
(3,797)
9,440
2,082
(600)
1,482
191
(94)
97
2,911
2,911
60,767
58,427
Group
Balance at 1 July 2021
Additions
Additions through business combinations (note 37)
Exchange differences
Depreciation expense
Balance at 30 June 2022
Additions
Additions through business combinations (note 37)
Lease reassessment
Exchange differences
Depreciation expense
Balance at 30 June 2023
For other AASB 16 and lease related disclosures, refer to the following:
●
●
●
●
note 7 for details of interest on lease liabilities and other lease payments;
note 17 for plant and equipment under lease;
note 22 for lease liabilities and maturity analysis at 30 June 2023; and
consolidated statement of cash flows for repayment of lease liabilities.
Note 19. Intangibles
Non-current assets
Goodwill
Customer relationships
Less: Accumulated amortisation
Software - at cost
Less: Accumulated amortisation
Product development - at cost
Less: Accumulated amortisation
Brand name - at cost
48
44
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 19. Intangibles (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Group
Balance at 1 July 2021
Additions
Additions through business
combinations (note 37)
Exchange differences
Amortisation expense
Balance at 30 June 2022
Additions through business
combinations (note 37)
Exchange differences
Amortisation expense
Customer
relationships
$'000
Product
Software development
$'000
$'000
Goodwill
$'000
35,351
-
9,510
(364)
-
4,121
-
6,447
(12)
(1,116)
1,604
164
-
-
(286)
44,497
9,440
1,482
2,834
216
-
1,697
7
(2,092)
-
-
(298)
133
-
-
-
(36)
97
-
-
(24)
73
Brand
name
$'000
2,600
-
311
-
-
Total
$'000
43,809
164
16,268
(376)
(1,438)
2,911
58,427
-
-
-
4,531
223
(2,414)
2,911
60,767
Balance at 30 June 2023
47,547
9,052
1,184
Impairment testing
For the purpose of impairment testing, goodwill and brands are allocated to a group of cash generating units ('CGUs'), which
are expected to benefit from the synergies of the business combinations.
Goodwill acquired through business combinations is allocated to the lowest level within the entity at which the goodwill is
monitored, being the two cash-generating units (or ‘CGU’s) – Panels and Construction Divisions.
Allocation to CGU’s
The carrying amount of goodwill and intangible assets are allocated to the Group’s CGUs as follows:
Cash generating units
Panels
Construction
Total
2023
$'000
Goodwill
2022
$'000
17,647
29,900
17,355
27,142
2023
$'000
2,729
182
Brand name
2022
$'000
2,729
182
47,547
44,497
2,911
2,911
The recoverable amount of the group of CGUs has been determined based on value-in-use calculations which use cash flow
projections from the financial budgets for the FY2024 financial year as reviewed and approved by the Board.
In preparing the FY2024 budget, due consideration was given to the current market and economic conditions. The cash flows
beyond the budget period have been extrapolated over a further four years. The value-in-use calculations have been
prepared using a compound growth rate of 0.6% (30 June 2022: 2%) and terminal growth rate of 2% (30 June 2022: 2%).
The discount rate applied to cashflow projections which are derived from the Group's weighted average cost of capital,
adjusted for varying risk profiles were:
●
●
Pre-tax discount rate 15.6% (30 June 2022: 14.3%)
Post-tax discount rate 11.3% (30 June 2022: 10.0%)
The two CGU's have been assessed with the same weighted average cost of capital as they have similar economic and risk
profiles.
45
49
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 19. Intangibles (continued)
The key assumptions used in the value-in-use calculation are based on past experience and the Group’s forecast operating
and financial performance for the CGUs taking into account the current market and economic conditions, risks, uncertainties
and opportunities for improvements.
Management has considered possible changes in the key assumptions used in the value-in-use calculations, including
reducing the growth rate for the projected cash flow period to 0% and increasing the post-tax discount rate to 13.3% to
determine their impact on headroom. Management has not identified any reasonable change in assumptions that would lead
to an impairment charge for either CGU.
The Group has concluded that no impairment is required as at 30 June 2023.
Note 20. Trade and other payables
Current liabilities
Trade payables
Goods and services tax payable
Other payables and accrued expenses
Refer to note 30 for further information on financial instruments.
Note 21. Borrowings
Current liabilities
Bank overdraft and trade finance
Non-current liabilities
Bank bills
Refer to note 30 for further information on financial instruments.
Assets pledged as security
Borrowings are secured by a first registered mortgage over assets of the Group.
2023
$'000
Group
2022
$'000
43,587
955
15,124
46,053
1,565
14,263
59,666
61,881
2023
$'000
Group
2022
$'000
2,618
2,538
41,000
36,000
50
46
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 21. Borrowings (continued)
Financing arrangements
Unrestricted access was available at the reporting date to the following lines of credit:
Total facilities
Bank overdraft and trade finance
Bank bills
Lease facility
Used at the reporting date
Bank overdraft and trade finance
Bank bills
Lease facility
Unused at the reporting date
Bank overdraft and trade finance
Bank bills
Lease facility
Note 22. Lease liabilities
Current liabilities
Lease liability - plant and equipment under lease
Lease liability - right-of-use lease
Non-current liabilities
Lease liability - plant and equipment under lease
Lease liability - right-of-use lease
2023
$'000
18,186
62,000
5,900
86,086
2,618
41,000
1,901
45,519
15,568
21,000
3,999
40,567
Group
2022
$'000
18,131
46,000
3,900
68,031
2,538
36,000
2,465
41,003
15,593
10,000
1,435
27,028
2023
$'000
Group
2022
$'000
803
7,773
843
6,951
8,576
7,794
1,098
19,130
1,622
15,810
20,228
17,432
47
51
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 22. Lease liabilities (continued)
The following table details the Group's remaining contractual maturity, both current and non-current, for its lease liabilities:
Between 1
and
2 years
$'000
Between 2
and
3 years
$'000
Between 3
and
4 years
$'000
Between 4
and
5 years
$'000
1 year
or less
$'000
Over
Remaining
contractual
5 years maturities
$'000
$'000
Group - 2023
Lease liability - plant and
equipment under lease
Lease liability - right-of-use
lease
Group - 2022
Lease liability - plant and
equipment under lease
Lease liability - right-of-use
lease
873
620
380
161
-
-
2,034
8,871
9,744
7,378
7,998
6,411
6,791
3,945
4,106
2,277
2,277
553
553
29,435
31,469
931
794
542
312
63
-
2,642
7,573
8,504
5,483
6,277
4,019
4,561
3,562
3,874
2,060
2,123
1,701
1,701
24,398
27,040
The cash flows in the maturity analysis above include interest and are not expected to occur significantly earlier than
contractually disclosed.
Note 23. Provisions
Current liabilities
Annual leave
Long service leave
Rehabilitation
Non-current liabilities
Long service leave
Lease make good
2023
$'000
3,951
3,418
-
Group
2022
$'000
3,548
3,325
65
7,369
6,938
661
450
1,111
306
450
756
Rehabilitation
The provision represents the estimated costs to remove equipment and remediate the site at Wagga Wagga NSW upon
closure.
Lease make good
The provision represents the present value of the estimated costs to make good the premises leased by the Group at the
end of the respective lease terms.
52
48
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 23. Provisions (continued)
Movements in provisions
Movements in each class of provision during the current financial year, other than employee benefits, are set out below:
Group - 2023
Carrying amount at the start of the year
Amounts used
Unused amounts reversed
Carrying amount at the end of the year
Note 24. Contingent consideration
Current liabilities
Contingent consideration
Non-current liabilities
Contingent consideration
Reconciliation
Reconciliation of the fair values at the beginning and end of the current and previous
financial year are set out below:
Opening balance
Additions through business combinations (note 37)
Unwind of present value interest
Payments made during the year
Exchange differences
Closing balance
Lease
Rehabilitation make good
$'000
$'000
65
(58)
(7)
-
450
-
-
450
2023
$'000
Group
2022
$'000
3,602
3,513
2,200
4,355
7,868
853
722
(3,641)
-
7,160
1,920
778
(2,022)
32
5,802
7,868
The provision represents the obligation to pay contingent consideration following the acquisition of a business or assets. It
is measured at the fair value of the estimated liability.
Fair value measurement
The below table gives information about how the level 3 fair values measurement of the contingent considerations that are
disclosed above and in note 37 are determined (in particular, the valuation technique and inputs used).
Type
Valuation technique
Significant
unobservable inputs
Relationship and sensitivity of
unobservable inputs to value
Contingent
consideration through
business combinations
The valuation model considers the
present value of the expected
payments which are determined
considering the possible scenarios
of forecast EBITDA.
Forecast EBITDA
Risk adjusted discount
rate
The higher the discount rate, the
lower the fair value
The higher the amount of EBITDA,
the higher the fair value
49
53
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 25. Other liabilities
Current liabilities
Deferred revenue
2023
$'000
Group
2022
$'000
2,324
2,324
Deferred revenue related to the portion of government grant that will be recognised over the life of the associated assets to
be acquired. The majority of the assets were commissioned in June 2023.
Note 26. Issued capital
2023
Shares
2022
Shares
2023
$'000
Group
2022
$'000
Ordinary shares - fully paid
83,037,905 82,227,610
98,517
96,665
Movements in ordinary share capital
Details
Date
Shares
Issue price
$'000
Balance
Issue of shares on completion of Revolution Wood
Panels
Issue of shares from dividend reinvestment plan
Issue of shares on completion of United Building
Products
Issue of shares from dividend reinvestment plan
Transaction costs arising on share issue, net of tax
Balance
Issue of shares on exercise of performance rights
Issue of shares in relation to dividend reinvestment
plan
Issue of shares in relation to dividend reinvestment
plan
1 July 2021
80,625,116
1 October 2021
6 October 2021
2 November 2021
6 April 2022
496,066
76,029
993,984
36,415
$2.09
$2.03
$2.13
$2.32
30 June 2022
2 September 2022
82,227,610
677,590
$2.31
6 October 2022
109,671
$2.10
29 March 2023
23,034
$2.46
Balance
30 June 2023
83,037,905
93,409
1,037
154
2,117
85
(137)
96,665
1,565
230
57
98,517
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion
to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company
does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
Capital risk management
The Group's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can provide
returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce the cost
of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated
as total borrowings less cash and cash equivalents.
54
50
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 26. Issued capital (continued)
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return
capital to shareholders, issue new shares or sell assets to reduce debt.
The Group would look to raise capital when an opportunity to invest in a business or company was seen as value adding
relative to the current Company's share price at the time of the investment.
The Group is subject to certain financing arrangements covenants and meeting these is given priority in all capital risk
management decisions. There have been no events of default on the financing arrangements during the financial year.
The capital risk management policy remains unchanged from the 30 June 2022 Annual Report.
Note 27. Reserves
Foreign currency translation reserve
Hedging reserve - cash flow hedges
Share-based payments reserve
2023
$'000
(747)
236
535
Group
2022
$'000
(1,183)
-
1,514
24
331
Foreign currency translation reserve
The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign
operations to Australian dollars.
Hedging reserve - cash flow hedges
The reserve is used to recognise the effective portion of the gain or loss of cash flow hedge instruments that is determined
to be an effective hedge.
Share-based payments reserve
The reserve is used to recognise the value of equity benefits provided to employees and directors as part of their
remuneration, and other parties as part of their compensation for services.
Note 28. Retained profits
Retained profits at the beginning of the financial year
Profit after income tax expense for the year
Dividends paid (note 29)
2023
$'000
15,424
22,176
(15,430)
Group
2022
$'000
1,096
21,267
(6,939)
Retained profits at the end of the financial year
22,170
15,424
51
55
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 29. Dividends
Dividends paid
Dividends paid during the financial year were as follows:
Final dividend of 10.0 cents per fully paid ordinary share paid on 6 October 2022 (2022: 3.0
cents paid on 6 October 2021)
Interim dividend of 8.6 cents per fully paid ordinary share paid on 29 March 2023 (2022: 5.5
cents paid on 6 April 2022)
2023
$'000
Group
2022
$'000
8,291
2,419
7,139
4,520
15,430
6,939
Dividend declared
On 23 August 2023, the directors determined a fully franked dividend of 8.5 cents per fully paid ordinary share to be paid on
6 October 2023.
Franking credits
2023
$'000
Group
2022
$'000
Franking credits available at the reporting date based on a tax rate of 30%
Franking credits that will arise from the payment of the amount of the provision for income
tax at the reporting date based on a tax rate of 30%
20,555
19,838
5,002
4,171
Franking credits available for subsequent financial years based on a tax rate of 30%
25,557
24,009
Note 30. Financial instruments
Financial risk management objectives
The Group's activities expose it to a variety of financial risks: market risk (including foreign currency risk and interest rate
risk), credit risk and liquidity risk. The Group's overall risk management program focuses on the unpredictability of financial
markets and seeks to minimise potential adverse effects on the financial performance of the Group. The Group uses
derivative financial instruments such as forward foreign exchange contracts to hedge certain risk exposures which are not
significant. Derivatives are exclusively used for hedging purposes, i.e. not as trading or other speculative instruments. The
Group uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity
analysis in the case of interest rate risk and ageing analysis for credit risk.
Risk management is carried out by senior finance executives ('finance') under policies approved by the Board of Directors
('the Board'). These policies include identification and analysis of the risk exposure of the Group and appropriate procedures,
controls and risk limits. Finance identifies, evaluates and hedges financial risks within the Group's operating units. Finance
reports to the Board on a monthly basis.
Market risk
Foreign currency risk
The Group's operations in NZ give rise to exposure to changes in foreign currency rates, primarily the NZD. The Group's
currency risk exposure is limited predominantly to consolidated Australian dollar translation risk as the majority of transactions
by the New Zealand operations are transacted by the same functional currency of the relevant transaction.
Where the Group purchases raw materials and consumables in foreign currencies such as USD or Euro, the Group will use
forward rate foreign exchange contracts to hedge exposure.
56
52
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 30. Financial instruments (continued)
Interest rate risk
The Group's main interest rate risk arises from long-term borrowings. Borrowings obtained at variable rates expose the Group
to interest rate risk. Borrowings obtained at fixed rates expose the Group to fair value interest rate risk. The policy is to
regularly monitor interest rates and utilise fixed rates for a portion of long-term borrowings when deemed appropriate by the
Board.
Cash flow hedges were used to cover the Group's exposure to variability in cash flow relating to interest rates. The effective
portion of interest rate swap is recognised in other comprehensive income and accumulated under cash flow hedge reserve
at 30 June 2023. No hedge reserve was accounted in prior financial year as the amount was immaterial.
As at the reporting date, the Group had the following variable rate borrowings outstanding:
Group
Bank overdraft and trade finance
Bank bills
Net exposure to cash flow interest rate risk
Weighted
average
interest rate
%
9.04%
6.97%
2023
2022
Weighted
average
interest rate
%
3.71%
3.25%
Balance
$'000
2,618
41,000
43,618
Balance
$'000
2,538
36,000
38,538
An analysis by remaining contractual maturities is shown in 'liquidity and interest rate risk management' below.
An official increase/decrease in interest rates of 100bps (30 June 2022: 100bps) would have an adverse/favourable effect
on profit before tax of the following:
Group - 2023
Basis points increase
Effect on
profit before
tax
$'000
Basis points
change
Effect on
equity
$'000
Basis points
change
$'000
Basis points decrease
Effect on
profit before
tax
$'000
Effect on
equity
$'000
Variable rate borrowings
(100)
(436)
(305)
100
436
305
Group - 2022
Basis points increase
Effect on
profit before
tax
$'000
Basis points
change
Effect on
equity
$'000
Basis points
change
$'000
Basis points decrease
Effect on
profit before
tax
$'000
Effect on
equity
$'000
Variable rate borrowings
(100)
(385)
(270)
100
385
270
The percentage change is based on the expected volatility of interest rates using market data and analysts' forecasts. No
principal repayments are due during the year ending 30 June 2023 or 30 June 2022.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group has a strict code of credit, including obtaining agency credit information, confirming references and setting
appropriate credit limits. The Group obtains guarantees where appropriate to mitigate credit risk. The maximum exposure to
credit risk at the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of
those assets, as disclosed in the statement of financial position and notes to the financial statements. The Group does not
hold any collateral.
53
57
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 30. Financial instruments (continued)
The Group has adopted a lifetime expected loss allowance in estimating expected credit losses to trade receivables through
the use of a provisions matrix using fixed rates of credit loss provisioning. These provisions are considered representative
across all customers of the Group based on recent sales experience, historical collection rates and forward-looking
information that is available. The allowance for expected credit losses, as disclosed in note 11, is calculated based on the
information available at the time of preparation. The actual credit losses in future years may be higher or lower.
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include
the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual
payments for a period greater than one year.
The Group has no significant credit risk to any individual customer.
Liquidity risk
Vigilant liquidity risk management requires the Group to maintain sufficient liquid assets (mainly cash and cash equivalents)
and available borrowing facilities to be able to pay debts as and when they become due and payable.
The Group manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously
monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.
Remaining contractual maturities
The following tables detail the Group's remaining contractual maturity for its financial instrument liabilities. The tables have
been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the financial
liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining contractual
maturities and therefore these totals may differ from their carrying amount in the statement of financial position.
Group - 2023
Non-derivatives
Non-interest bearing
Trade payables
Other payables and accrued
expenses
Contingent consideration
Interest-bearing - variable
Bank overdraft and trade
finance
Bank bills
Total non-derivatives
Weighted
average
interest rate
%
1 year or less
$'000
Between 1
and 2 years
$'000
Between 2
and 5 years
$'000
Over 5 years
$'000
Remaining
contractual
maturities
$'000
-
-
-
43,587
15,124
3,750
-
-
2,500
-
-
-
9.04%
6.97%
2,692
2,859
68,012
-
32,319
34,819
-
12,298
12,298
-
-
-
-
-
-
43,587
15,124
6,250
2,692
47,476
115,129
58
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Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 30. Financial instruments (continued)
Group - 2022
Non-derivatives
Non-interest bearing
Trade payables
Other payables and accrued
expenses
Contingent consideration
Interest-bearing - variable
Bank overdraft and trade
finance
Bank bills
Total non-derivatives
Weighted
average
interest rate
%
1 year or less
$'000
Between 1
and 2 years
$'000
Between 2
and 5 years
$'000
Over 5 years
$'000
Remaining
contractual
maturities
$'000
-
-
-
46,053
14,263
3,534
-
-
-
2,758
-
1,576
3.71%
3.25%
2,538
1,170
67,558
-
36,879
39,637
-
-
1,576
-
-
-
-
-
-
46,053
14,263
7,868
2,538
38,049
108,771
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed
above.
Remaining contractual maturities for leases in the current year are now disclosed in non-current liabilities - lease liabilities
(refer to note 22).
Note 31. Fair value measurement
Fair value hierarchy
The following tables detail the Group's assets and liabilities, measured or disclosed at fair value, using a three level hierarchy,
based on the lowest level of input that is significant to the entire fair value measurement, being:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the
measurement date
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or
indirectly
Level 3: Unobservable inputs for the asset or liability
Level 1
$'000
Level 2
$'000
Level 3
$'000
Group - 2023
Assets
Ordinary shares
Derivatives
Total assets
Liabilities
Contingent consideration
Total liabilities
Group - 2022
Assets
Ordinary shares
Total assets
Liabilities
Contingent consideration
Total liabilities
-
-
-
-
-
-
235
235
-
-
Level 1
$'000
Level 2
$'000
-
-
-
-
-
-
-
-
55
Total
$'000
226
235
461
5,802
5,802
Total
$'000
113
113
226
-
226
5,802
5,802
Level 3
$'000
113
113
7,868
7,868
7,868
7,868
59
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 31. Fair value measurement (continued)
Assets and liabilities held for sale are measured at fair value on a non-recurring basis.
There were no transfers between levels during the financial year.
The carrying amounts of trade and other receivables and trade and other payables are assumed to approximate their fair
values due to their short-term nature.
The fair value of financial liabilities is estimated by discounting the remaining contractual maturities at the current market
interest rate that is available for similar financial liabilities.
Valuation techniques for fair value measurements categorised within level 2 and level 3
Unquoted investments have been valued using a discounted cash flow model.
Derivative financial instruments have been valued using quoted market rates. This valuation technique maximises the use
of observable market data where it is available and relies as little as possible on entity specific estimates.
Refer to note 24 for further information on the fair value measurement of contingent consideration.
Note 32. Key management personnel disclosures
Compensation
The aggregate compensation made to directors and other members of key management personnel of the Group is set out
below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Note 33. Remuneration of auditors
2023
$
Group
2022
$
1,338,137
92,393
2,952
244,437
1,402,649
87,986
138,058
515,824
1,677,919
2,144,517
During the financial year the following fees were paid or payable for services provided by Deloitte Touche Tohmatsu, the
auditor of the Company:
2023
$
Group
2022
$
455,000
373,000
90,000
-
85,500
41,645
90,000
127,145
545,000
500,145
Audit services - Deloitte Touche Tohmatsu
Audit or review of the financial statements
Other services - Deloitte Touche Tohmatsu
Taxation
Other services
60
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Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 34. Contingent liabilities
The Group has given bank guarantees as at 30 June 2023 of $2,539,000 (30 June 2022: $2,497,000) to various landlords.
Note 35. Related party transactions
Parent entity
Big River Industries Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 38.
Key management personnel
Disclosures relating to key management personnel are set out in note 32 and the remuneration report included in the
directors' report.
Transactions with related parties
During the financial year, the Company paid $77,000 (30 June 2022: $77,000) to Anacacia Capital Pty Ltd, a director related
entity and substantial shareholder, as an advisory fee.
Receivable from and payable to related parties
There were no trade receivables from or trade payables to related parties at the current and previous reporting date.
Loans to/from related parties
There were no loans to or from related parties at the current and previous reporting date.
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
Note 36. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Profit after income tax
Other comprehensive income for the year, net of tax
Total comprehensive income
2023
$'000
Parent
2022
$'000
15,717
7,284
-
-
15,717
7,284
57
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Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 36. Parent entity information (continued)
Statement of financial position
Total current assets
Total non-current assets
Total assets
Total current liabilities
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share-based payments reserve
Retained profits
Total equity
2023
$'000
Parent
2022
$'000
93,108
86,992
48,322
48,325
141,430
135,317
69
116
41,000
36,000
41,069
36,116
100,361
99,201
98,517
535
1,309
96,665
1,514
1,022
100,361
99,201
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity is a party to a deed of cross guarantee (refer note 39) under which it guarantees the debts of its subsidiaries
as at 30 June 2023 and 30 June 2022.
Contingent liabilities
The parent entity had no significant contingent liabilities as at 30 June 2023 and 30 June 2022.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment as at 30 June 2023.
Under the Government Grant entitlement in 2020, the Group agreed to invest approximately $6.0m of capital expenditure
expanding the Grafton NSW Site. As at 30 June 2023, there was approximately $0.7m of capital commitments remaining
from this investment.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 2, except for
investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.
Note 37. Business combinations
2023
F.A. Mitchell & Co Pty Ltd ('F.A. Mitchell')
On 7 July 2022, the Group executed a business purchase deed to acquire the business and assets of F.A. Mitchell & Co Pty
Ltd ('F.A. Mitchell'), a business located in Lidcombe, NSW. Completion was effective from 1 August 2022 with a purchase
price of $598,000 paid in cash, which includes inventory and plant and equipment. The acquisition contributed $4.2 million
to revenue and $0.2 million to net profit after tax of the Group for the year ended 30 June 2023.
62
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Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 37. Business combinations (continued)
Epping Timber Joinery & Hardware Pty Ltd and Epping Timber Prefab Pty Ltd ('Epping Timber')
On 14 November 2022, the Group executed a business purchase deed to acquire the business and assets of Epping Timber
Joinery & Hardware Pty Ltd and Epping Timber Prefab Pty Ltd ('Epping Timber'), a business located in Epping and Beaufort,
VIC. Completion was effective from 1 December 2022 and the maximum purchase price of $6 million, which includes
inventory, and plant and equipment, was settled through the payment of $5 million in cash, with the balance payable upon
achieving agreed EBITDA targets over a two year period. The acquisition contributed $10.4 million to revenue and $0.5
million to net profit after tax of the Group for the year ended 30 June 2023.
The values identified in relation to the acquisitions are final as at 30 June 2023.
Details of the acquisitions are as follows:
F.A. Mitchell
Fair value
$'000
Epping
Timber
Fair value
$'000
Inventories
Prepayments
Plant and equipment
Right-of-use assets
Customer relationships
Deferred tax asset
Deferred tax liability
Employee benefits
Lease liability
Net assets acquired
Goodwill
Total consideration transferred
Representing:
Cash paid or payable to vendor
Contingent consideration
Cash used to acquire business, net of cash acquired:
Total consideration transferred
Less: contingent consideration
Net cash used
2022
468
-
108
1,094
-
23
-
(77)
(1,094)
522
76
598
598
-
598
598
-
598
Total
$'000
2,170
94
580
1,094
1,697
179
(509)
(598)
(1,094)
3,613
2,834
1,702
94
472
-
1,697
156
(509)
(521)
-
3,091
2,758
5,849
6,447
4,996
853
5,594
853
5,849
6,447
5,849
(853)
6,447
(853)
4,996
5,594
Revolution Wood Panels
On 24 August 2021, the Group executed a business purchase deed to acquire the business and assets of Revolution Wood
Panels Pty Ltd ('Revolution Wood Panels'), a business located in the Brisbane suburb of Brendale, QLD. Completion was
effective from 1 October 2021 and the maximum purchase price of $7.8 million, which includes inventory, and plant and
equipment, was settled through the payment of $6.0 million in cash, the issue of $1.0 million in ordinary shares of Big River
Industries Ltd, with the balance payable upon achieving agreed EBITDA targets over a two year period. The acquisition
contributed $12.1 million to revenue and $0.7 million to net profit after tax of the Group for the year ended 30 June 2022.
The values identified in relation to the acquisition are final as at 30 June 2022.
59
63
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 37. Business combinations (continued)
United Building Products
On 4 October 2021, the Group executed a business purchase deed to acquire the business and assets of United Home &
Trade Pty Ltd ('United Building Products'), a business located in Albion Park, NSW. Completion was effective from 1
November 2021 and the maximum purchase price of $10.7 million, which includes inventory, and plant and equipment, was
settled through the payment of $7.5 million in cash, the issue of $2.1 million in ordinary shares of Big River Industries Ltd,
with the balance payable upon achieving agreed EBITDA targets over a two year period. The acquisition contributed $15.5
million to revenue and $1.1 million to net profit after tax of the Group for the year ended 30 June 2022. The values identified
in relation to the acquisition are final as at 30 June 2022.
Details of the acquisitions are as follows:
Inventories
Plant and equipment
Right-of-use assets
Customer relationships
Brand
Deferred tax asset
Deferred tax liability
Employee benefits
Lease make good provision
Lease liability
Net assets acquired
Goodwill
Revolution
Wood
Panels
Fair value
$'000
United
Building
Products
Fair value
$'000
1,598
613
1,157
3,168
129
76
(1,059)
(255)
(90)
(1,066)
4,271
3,532
2,350
321
5,350
3,279
182
104
(1,142)
(345)
(60)
(5,291)
4,748
5,978
Total
$'000
3,948
934
6,507
6,447
311
180
(2,201)
(600)
(150)
(6,357)
9,019
9,510
Acquisition-date fair value of the total consideration transferred
7,803
10,726
18,529
Representing:
Cash paid or payable to vendor
Big River Industries Limited shares issued to vendor
Contingent consideration
5,998
1,037
768
7,457
2,117
1,152
13,455
3,154
1,920
7,803
10,726
18,529
Acquisition costs expensed to profit or loss
624
214
838
Cash used to acquire business, net of cash acquired:
Acquisition-date fair value of the total consideration transferred
Less: contingent consideration
Less: shares issued by Company as part of consideration
Net cash used
7,803
(768)
(1,037)
10,726
(1,152)
(2,117)
18,529
(1,920)
(3,154)
5,998
7,457
13,455
64
60
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 38. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance
with the accounting policy described in note 2:
Name
Big River Group Pty Ltd
Big River Group (NZ) Limited
Plytech International Limited
Decortech Limited
Note 39. Deed of cross guarantee
Principal place of business /
Country of incorporation
Australia
New Zealand
New Zealand
New Zealand
Ownership interest
2023
2022
%
%
100%
100%
100%
100%
100%
100%
100%
100%
The following entities are party to a deed of cross guarantee under which each company guarantees the debts of the others:
Big River Industries Limited
Big River Group Pty Ltd
By entering into the deed, the wholly-owned entities have been relieved from the requirement to prepare financial statements
and directors' report under Corporations Instrument 2016/785 issued by the Australian Securities and Investments
Commission.
The above companies represent a 'Closed Group' for the purposes of the Corporations Instrument, and as there are no other
parties to the deed of cross guarantee that are controlled by Big River Industries Limited, they also represent the 'Extended
Closed Group'.
The statement of profit or loss and other comprehensive income and statement of financial position are substantially the
same as the Group and therefore have not been separately disclosed.
61
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Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 40. Cash flow information
Reconciliation of profit after income tax to net cash from operating activities
Profit after income tax expense for the year
Adjustments for:
Depreciation and amortisation
Reversal of impairment of property, plant and equipment
Net gain on disposal of property, plant and equipment
Share-based payments
Interest on contingent consideration
Interest on property leases
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables
Decrease/(increase) in inventories
Decrease/(increase) in prepayments
Increase in deferred tax
Increase/(decrease) in trade and other payables
Increase in provision for income tax
Increase/(decrease) in other provisions
Increase/(decrease) in other operating liabilities
2023
$'000
Group
2022
$'000
22,176
21,267
13,849
-
(95)
586
722
966
3,496
5,446
(369)
187
(2,213)
109
187
198
12,240
(316)
(62)
909
778
784
(9,449)
(14,722)
1,086
2,907
20,659
4,292
(1,467)
(1,746)
Net cash from operating activities
45,245
37,160
Non-cash investing and financing activities
Additions to the right-of-use assets
Shares issued under employee share plan
Shares issued under dividend reinvestment plan
Shares issued in relation to business combinations
Lease reassessment
2023
$'000
1,166
1,565
287
-
9,842
Group
2022
$'000
154
-
239
3,154
-
12,860
3,547
62
66
Big River Industries Limited Annual Report 2023Financial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 40. Cash flow information (continued)
Changes in liabilities arising from financing activities
Group
Balance at 1 July 2021
Net cash from/(used in) financing activities
Acquisition of leases
Changes through business combinations (note 37)
Balance at 30 June 2022
Net cash from/(used in) financing activities
Lease reassessment
Acquisition of leases
Changes through business combinations (note 37)
Other changes
Balance at 30 June 2023
Note 41. Earnings per share
Bank
bills
$'000
26,000
10,000
-
-
36,000
5,000
-
-
-
-
Lease
liability
$'000
25,786
(7,071)
154
6,357
25,226
(9,914)
9,842
1,166
1,094
1,390
Total
$'000
51,786
2,929
154
6,357
61,226
(4,914)
9,842
1,166
1,094
1,390
41,000
28,804
69,804
2023
$'000
Group
2022
$'000
Profit after income tax attributable to the owners of Big River Industries Limited
22,176
21,267
Weighted average number of ordinary shares used in calculating basic earnings per share
Adjustments for calculation of diluted earnings per share:
82,874,703 81,716,852
Performance rights
1,308,643
1,644,577
Weighted average number of ordinary shares used in calculating diluted earnings per share 84,183,346 83,361,429
Number
Number
Basic earnings per share
Diluted earnings per share
Note 42. Share-based payments
Cents
Cents
26.76
26.34
26.03
25.51
Performance rights
At the 2018 Annual General Meeting, shareholders approved the Big River Industries Limited Rights Plan ('BRIRP') to be
able to grant performance rights to certain key executive management personnel.
The number of performance rights vesting is determined by reference to the compound annual growth rate ('CAGR') in
earnings per share ('EPS') over the vesting period and ranges from nil for less than 3% CAGR in EPS to 100% for greater
than 10% CAGR in EPS, subject to overriding discretion held by the Board.
63
67
Annual Report 2023 Big River Industries LimitedFinancial Report
Notes to the Financial Statements
Big River Industries Limited
Notes to the consolidated financial statements
30 June 2023
30 June 2023
Note 42. Share-based payments (continued)
Set out below are summaries of performance rights granted under the plan:
2023
Grant date
Expiry date
28/11/2024
01/12/2025
17/12/2026
14/10/2027
14/10/2027
28/11/2019
01/12/2020
17/12/2021
14/10/2022
24/02/2023
2022
Grant date
Expiry date
23/11/2018
28/11/2019
01/12/2020
17/12/2021
23/11/2023
28/11/2024
01/12/2025
17/12/2026
Balance at
the start of
the year
677,590
541,662
473,429
-
-
1,692,681
Balance at
the start of
the year
341,355
677,590
541,662
-
1,560,607
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
-
286,565
76,098
362,663
(677,590)
-
-
-
-
(677,590)
-
(58,039)
(128,686)
(37,346)
-
(224,071)
-
483,623
344,743
249,219
76,098
1,153,683
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
-
473,429
473,429
-
-
-
-
-
(341,355)
-
-
-
(341,355)
-
677,590
541,662
473,429
1,692,681
The weighted average remaining contractual life of performance rights outstanding at the end of the financial year was 3.27
years (30 June 2022: 3.25 years).
Valuation model inputs
For the performance rights granted during the current financial year, the valuation model inputs used to determine the fair
value at the grant date, are as follows:
Grant date
14/10/2022
24/02/2023
Expiry date
14/10/2027
14/10/2027
Note 43. Events after the reporting period
Share price
at grant date
Dividend
yield
Risk-free
Fair value
interest rate at grant date
$2.03
$2.53
7.60%
7.40%
4.00%
4.00%
$1.610
$2.028
Apart from the dividend declared as disclosed in note 29, no other matter or circumstance has arisen since 30 June 2023
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 future financial years.
68
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Big River Industries Limited Annual Report 2023Financial Report
Directors’ Declaration
Big River Industries Limited
Directors' declaration
30 June 2023
30 June 2023
In the directors' opinion:
●
●
●
●
●
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional reporting requirements;
the attached financial statements and notes comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board as described in note 2 to the financial statements;
the attached financial statements and notes give a true and fair view of the Group's financial position as at 30 June
2023 and of its performance for the financial year ended on that date;
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable; and
at the date of this declaration, there are reasonable grounds to believe that the members of the Extended Closed Group
will be able to meet any obligations or liabilities to which they are, or may become, subject by virtue of the deed of cross
guarantee described in note 39 to the financial statements.
The directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the directors
___________________________
Malcolm Jackman
Chairman
23 August 2023
Sydney
___________________________
John Lorente
Managing Director and Chief Executive Officer
65
69
Annual Report 2023 Big River Industries LimitedFinancial Report
Independent Auditor’s Report to the Members
of Big River Industries Limited
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Quay Quarter Tower
50 Bridge Street
Sydney, NSW, 2000
Australia
Phone: +61 2 9322 7000
www.deloitte.com.au
IInnddeeppeennddeenntt AAuuddiittoorr’’ss RReeppoorrtt ttoo tthhee MMeemmbbeerrss ooff BBiigg RRiivveerr
IInndduussttrriieess LLiimmiitteedd
RReeppoorrtt oonn tthhee AAuuddiitt ooff tthhee FFiinnaanncciiaall RReeppoorrtt
Opinion
We have audited the financial report of Big River Industries Limited (the “Company”) and its subsidiaries (the
“Group”) which comprises the consolidated statement of financial position as at 30 June 2023, the consolidated
statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity
and the consolidated statement of cash flows for the year then ended, and notes to the financial statements,
including material accounting policy information, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
• Giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its financial performance
for the year then ended; and
• Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are
relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in
accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report for the current period. These matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Asia Pacific Limited and the Deloitte organisation.
66
70
Big River Industries Limited Annual Report 2023
EExxiisstteennccee aanndd ccoommpplleetteenneessss ooff iinnvveennttoorriieess HHooww tthhee ssccooppee ooff oouurr aauuddiitt rreessppoonnddeedd ttoo tthhee KKeeyy AAuuddiitt MMaatttteerr
As at 30 June 2023, the Group has
recognised $69.5m of inventories (net of
provision) in the consolidated statement of
financial position as disclosed in Note 12.
The Group holds inventories of finished
goods at each of its retail branches and
manufacturing sites across Australia and
New Zealand.
Existence and completeness of inventories
is assessed by the Group through the
completion of annual stock takes at each
of the Group’s retail branches and
manufacturing sites.
Existence and completeness of inventories
is a key audit matter due to the nature of
inventories where the value per unit is
relatively insignificant but high volumes
are involved which are dispersed across
different locations.
Our procedures included, but were not limited to:
• Obtaining an understanding of the Group’s stock take
•
procedures and controls;
Evaluating the appropriateness of the Group’s stock
take procedures and controls;
• Attending a sample of inventory locations and observing
the Group’s stock take procedures at these locations;
• On a sample basis, testing the existence and
completeness of inventories, by tracing items from the
inventory system to the physical location and from the
physical location to the inventory system respectively;
Testing the summation of the final inventory sheets to
the inventory system to test that variances identified at
count date have been appropriately updated; and
• Agreeing the inventory system to the general ledger.
•
We have also assessed the adequacy of the relevant disclosures
in Notes 2 and 12 to the financial statements.
Other Information
The directors are responsible for the other information. The other information comprises the Directors’ Report,
Corporate Directory and Shareholder Information, which we obtained prior to the date of this auditor’s report,
and also includes the following information which will be included in the Group’s annual report (but does not
include the financial report and our auditor’s report thereon): Chairman and Managing Director’s Report and
Corporate Details, which is expected to be made available to us after that date.
Our opinion on the financial report does not cover the other information and we do not and will not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information identified
above and, in doing so, consider whether the other information is materially inconsistent with the financial report
or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we
have performed on the other information that we obtained prior to the date of this auditor’s report, we conclude
that there is a material misstatement of this other information, we are required to report that fact. We have
nothing to report in this regard.
When we read the Chairman and Managing Director’s Report and Corporate Details, if we conclude that there is
a material misstatement therein, we are required to communicate the matter to the directors and use our
professional judgement to determine the appropriate action.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate Group or to cease operations, or have no realistic
alternative but to do so.
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Annual Report 2023 Big River Industries Limited
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and
maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Group’s internal control.
•
•
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that achieves
fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial report. We are responsible for the direction,
supervision and performance of the Group’s audit. We remain solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards
applied.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
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Big River Industries Limited Annual Report 2023
RReeppoorrtt oonn tthhee RReemmuunneerraattiioonn RReeppoorrtt
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 14 to 20 of the Directors’ Report for the year ended
30 June 2023.
In our opinion, the Remuneration Report of Big River Industries Limited, for the year ended 30 June 2023, complies
with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
DELOITTE TOUCHE TOHMATSU
David Haynes
Partner
Chartered Accountants
Sydney, 23 August 2023
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Annual Report 2023 Big River Industries Limited Shareholder Information
Big River Industries Limited
Shareholder information
30 June 2023
30 June 2023
The shareholder information set out below was applicable as at 4 August 2023.
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Holding less than a marketable parcel
Equity security holders
Twenty largest quoted equity security holders
The names of the twenty largest security holders of quoted equity securities are listed below:
Ordinary shares
% of total
shares
issued
Number
of holders
382
335
100
126
33
976
42
0.21
1.11
0.97
4.63
93.08
100.00
-
Ordinary shares
% of total
shares
issued
Number held
30,194,597
12,533,089
5,584,187
3,959,202
3,210,655
3,077,569
2,799,057
2,222,449
1,951,369
1,898,803
1,037,742
984,122
901,632
901,632
740,741
675,395
396,880
319,048
285,714
278,750
36.36
15.09
6.72
4.77
3.87
3.71
3.37
2.68
2.35
2.29
1.25
1.19
1.09
1.09
0.89
0.81
0.48
0.38
0.34
0.34
73,952,633
89.07
Number
on issue
Number
of holders
1,153,683
11
NATIONAL NOMINEES LIMITED
ANACACIA PARTNERSHIP II LP
PANTHEON GLOBAL CO-INVESTMENT OPPORTUNITIES FUND I I LP
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
BNP PARIBAS NOMINEES PTY LTD (AGENCY LENDING DRP A/C)
PANTHEON INTERNATIONAL PLC
PANTHEON GLOBAL CO-INVESTMENT OPPORTUNITIES FUND III LP
GRANJE PTY LTD (PARSONSON FAMILY A/C)
ANACACIA PTY LTD (WATTLE FUND)
UBS NOMINEES PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
SAID BUILDING PRODUCTS GROUP PTY LTD
DENIS WILLIAM JAGGAR & CHRISTINE PAULA JAGGAR (NIKAU POINT)
PAUL HARVEY WEBBER & SUSAN MARGARET WEBBER (CADENZA)
IAIN OWUSU ANASH AGYEMAN (AGYEMAN FAMILY)
PANTHEON MULTI STRATEGY CO-INVESTMENT PROGRAM 2014
PANTHEON ASIA FUND VI LP
MEGAN ANNE BINDON (THE BINDON FAMILY A/C)
SANDHURST TRUSTEES LTD (CYAN C3G FUND A/C)
CITICORP NOMINEES PTY LIMITED
Unquoted equity securities
Performance rights
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Big River Industries Limited Annual Report 2023
Shareholder Information
Big River Industries Limited
Shareholder information
30 June 2023
30 June 2023
Substantial holders
Substantial holders in the Company are set out below:
Naos Asset Management
Anacacia Partnership II, LP
Voting rights
The voting rights attached to ordinary shares are set out below:
Ordinary shares
% of total
shares
issued
Number held
30,242,065
25,066,177
36.42
30.19
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
There are no other classes of equity securities.
On-market buy-backs
There is no current on-market buy-back in relation to the Company's securities.
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Annual Report 2023 Big River Industries Limited
Corporate Directory
Big River Industries Limited
Corporate directory
30 June 2023
Directors
John Lorente
Malcolm Geoffrey Jackman
Martin Monro
Martin Kaplan
Vicky Papachristos
Brendan York
Brad Soller
Company secretary
John O'Connor
Registered office
Share register
Auditor
Solicitors
Trenayr Road
Junction Hill NSW 2460
Tel: 02 6644 0900
Link Market Services Limited
Level 12
680 George Street
Sydney NSW 2000
Tel: 1300 554 474
Deloitte Touche Tohmatsu
Quay Quarter Tower
50 Bridge Street
Sydney NSW 2000
Thomson Geer
Level 14
60 Martin Place
Sydney NSW 2000
Stock exchange listing
Big River Industries Limited shares are listed on the Australian Securities Exchange
(ASX code: BRI)
Website
bigrivergroup.com.au
Corporate Governance Statement
The directors and management are committed to conducting the business of Big River
Industries Limited in an ethical manner and in accordance with the highest standards
of corporate governance. Big River Industries Limited has adopted and has
substantially complied with
the ASX Corporate Governance Principles and
Recommendations (Fourth Edition) ('Recommendations') to the extent appropriate to
the size and nature of its operations.
The Corporate Governance Statement, which sets out the corporate governance
practices that were in operation during the financial year and identifies and explains
any Recommendations that have not been followed, which is approved at the same
time as the Annual Report can be found at:
bigriverindustries.com.au/Investors/?page=Corporate-Governance
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Big River Industries Limited Annual Report 2023
Branch Network
QLD:
Townsville
Sunshine Coast
Meadowbrook
Hillcrest
Gold Coast
Brendale
NSW:
Mount Druitt
Lidcombe
Lidcombe
Kiama
Grafton (Factory)
Albion Park
Head Office
ACT:
Hume
Beard
Big Hammer
Cnr Anne and Rendle Streets, Aitkenvale QLD 4814
Phone: (07) 4725 5260
Postal: PO Box 7296 Garbutt QLD 4814
10 Main Drive, Warana QLD 4575
Phone: (07) 5439 1000
Postal: PO Box 260 Buddina QLD 4575
45 Ellerslie Road, Meadowbrook QLD 4131
Phone: (07) 3451 8300
Postal: PO Box 1858 Springwood QLD 4127
Sabdia
24 Johnson Road, Hillcrest QLD 4118
Phone: (07) 3080 2700
Postal: 22-24 Johnson Road, Hillcrest QLD 4118
Midcoast Timbers
11 Central Drive, Burleigh Heads QLD 4220
Phone: (07) 5522 0624
Postal: PO Box 3189 Burleigh Town QLD 4220
Revolution Wood Panels
89 South Pine Rd Brendale QLD 4500
Phone: (07) 3205 9182
89 Kurrajong Avenue, Mt Druitt NSW 2770
Phone: (02) 8822 5555
Postal: PO Box 1049 St Marys NSW 2760
FA Mitchell + Co
41 East Street, Lidcombe NSW 2142
Phone: (02) 9646 2777
Timberwood Panels
41 East Street, Lidcombe NSW 2142
Phone: (02) 8000 5599
113 Shoalhaven Street, Kiama NSW 2533
Phone: (02) 4232 6600
Postal: PO Box 430 Kiama NSW 2533
61 Trenayr Road, Junction Hill NSW 2460
Phone: (02) 6644 0900
Postal: PO Box 281 Grafton 2460
United Building Products
3 Durgadin Dr, Albion Park Rail NSW 2527
Phone: (02) 4235 7000
61 Trenayr Road, Junction Hill NSW 2460
Phone: (02) 6644 0900
Postal: PO Box 281 Grafton 2460
Ern Smith Building Supplies
13 Sheppard Street, Hume ACT 2620
Phone: (02) 6260 1366
Postal: PO BOX 305 Jerrabomberra NSW 2619
Timberwood Panels
2 Copper Crescent, Beard ACT 2620
Phone: (02) 6293 8555
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Annual Report 2023 Big River Industries Limited
Postal: PO BOX 305 Jerrabomberra NSW 2619
24-32 Discovery Road, Dandenong South VIC 3175
Phone: (03) 9586 6900
Postal: PO Box 4388 Dandenong South VIC 3164
Timberwood Panels
185 Hammond Road, Dandenong South VIC 3175
Phone: (03) 8780 4666
Timberwood Panels
76-106 National Blvd, Campbellfield VIC 3175
Phone: (03) 8301 1300
MB Prefab
15-17 Leather Street, Breakwater VIC 3219
Phone: (03) 5223 2888
Postal: PO Box 4388 Dandenong South VIC 3164
Epping Timber
Cnr. Cooper and Duffy Streets, Epping VIC 3219
Phone: (03) 9401 1033
Epping Timber (Prefab)
5–7 Racecourse Road, Beaufort VIC 3373
Phone: (03) 5349 2066
10 Kingstag Crescent, Edinburgh North SA 5113
Phone: (08) 8255 5577
Postal: PO Box 18 Edinburgh North SA 5113
Pine Design
142 Cavan Road, Dry Creek SA 5094
Phone: (08) 8203 2933
Postal: 142 Cavan Road, Dry Creek SA 5094
255 Treasure Road, Welshpool WA 6106
Phone: (08) 9256 7400
Postal: PO Box 183 Welshpool DC WA 6986
Midland Timber
30 Clayton Street, Bellevue WA 6056
Phone: (08) 9274 8077
Postal: 30 Clayton Street, Bellevue WA 6056
Plytech
26 Business Parade North, Highbrook Auckland
Phone: +64 9 573 5016
Postal: PO Box 204-070 Highbrook Auckland
Decortech
117 Hugo Johnston Drive, Penrose Auckland
Phone: +64 9 579 5726
Postal: PO Box 17-091 Greenlane Auckland
Branch Network
VIC:
Dandenong South
Dandenong South
Campbellfield
Geelong
Epping
Beaufort
SA:
Edinburgh North
Dry Creek
WA:
Welshpool
Bellevue
New Zealand:
Auckland
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Big River Industries Limited Annual Report 2023
Our suppliers
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Annual Report 2023 Big River Industries Limited Building Australia for over 100 years
www.bigrivergroup.com.au