14 September 2021
The Manager
Market Announcements Platform
Australian Securities Exchange
Annual Report for Year Ending 30 June 2021
The Company has great pleasure in releasing its Annual Report for the Year Ending 30 June 2021 including the
Chairman’s Report and the Corporate Governance Statement, as well as the Directors’ Report and the audited
FY2021 Financial Statements and Notes to the Accounts.
Yours faithfully
Dennis Payne
Company Secretary
Beam Communications Holdings Limited
ABN 39 010 568 804
5/8 Anzed Court,
Mulgrave, Victoria
Australia 3170
Phone: +61 3 8561 4200
Email: investor@beamcommuncations.com
Website: beamcommunications.com
Beam Communications Pty Ltd
Beam Communications USA Inc.
ABN 97 103 107 919
Delaware Corporation No. 5228652
5/8 Anzed Court,
Mulgrave, Victoria
Australia 3170
C/- Martensen Wright PC
One Capitol Mall, Suite 670
Sacramento, CA 95814 USA
Phone: +61 3 8588 4500
Email: info@beamcommuncations.com
Website: beamcommunications.com
Phone: +1 800 250 5819 (USA only)
Email: info@beamcommuncations.com
Website: beamcommunications.com
SatPhone Shop Pty Ltd
ABN 40 099 121 276
5/8 Anzed Court,
Mulgrave, Victoria
Australia 3170
SatPhonerental Pty Ltd
ABN 18 114 959 992
5/8 Anzed Court,
Mulgrave, Victoria
Australia 3170
Phone: 1300 368 611
Email: info@satphoneshop.com
Website: satphoneshop.com
Phone: 1300 368 611
Email: rentals@satphoneshop.com
Website: satphonerentals.com
DIRECTORATE
CONTENTS
NON EXECUTIVE CHAIRMAN
Mr Simon Lister Wallace
Directorate
MANAGING DIRECTOR
Mr Michael Ian Capocchi
NON EXECUTIVE DIRECTOR
Mr David Paul James Stewart
COMPANY SECRETARY
Mr Dennis Frank Payne
REGISTERED OFFICE
Beam Communications
Holdings Limited
Unit 5/8 Anzed Court
Mulgrave, VIC, 3170
Ph: (03) 8561 4200
Email: investor@beamcommunications.com
SHARE REGISTER
Link Market Services Ltd
Locked Bag A14
Sydney South, NSW, 1235
Ph: 1300 554 474
SOLICITORS TO
THE COMPANY
GrilloHiggins Lawyers
Level 4, 114 William Street
Melbourne, VIC, 3000
Ph: (03) 8621 8888
AUDITOR
RSM Australia Partners
Level 21, 55 Collins Street
Melbourne, VIC, 3000
Ph: (03) 9286 8000
ASX OFFICE
Based in Melbourne
ASX CODE
BCC
Chairman’s Report
Directors’ Report
Auditor’s Independence Declaration
Corporate Governance Statement
Consolidated Financial Statements
Consolidated Statement of Profit or Loss and Other
Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors’ Declaration
Auditor’s Report
Australian Securities Exchange Information
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4
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Ann ua l Repo rt 2021 1
CHAIRMAN’S REPORT
Chairman: Simon Wallace
Reflections
There are years in our personal and professional lives of which our
memories, a long time from now, may merge into each other, with no 12
months particularly discernible from another in our reflections.
FY2021 was not one of those.
Profit Performance and Major Impacts
The last financial year marks the beginning of Beam’s transformation
into a business that will generate very significant recurring subscription
revenues to supplement its legacy business, which has a track record of
strong hardware sales.
We are starting the next phase of this journey in a very robust financial
position, as Beam reported both record sales and profit before tax (PBT)
for FY2021. Group revenue advanced 24% to $18.5 million, while PBT
increased by $2.3 million over the previous financial year to $780,477.
Most areas of Beam’s business contributed to these good results, but
our growth in revenue was, pleasingly, largely driven by the success of
the Beam-designed and developed ZOLEO global seamless messaging
solution, which during FY2021 was available for sale through some of the
largest retailers in the United States, Canada and Australia.
Importantly, these strong results do not include any meaningful recurring
revenue from ZOLEO subscriptions. These revenues will only become
material from FY2022 onwards.
As we have previously highlighted, Beam sells the ZOLEO device on
a slim margin to encourage consumer adoption, as subscriptions are
both the key profit driver for the product, but also most appreciated by
existing and prospective investors when making valuation assessments.
For many years, Beam has been looking for an opportunity to develop a
solution that will deliver the Group passive, recurring revenues, rather
than merely product sales. And now we have one – not by accident, or
acquisition, but by design.
The success of ZOLEO is reflected both in the almost 100,000 devices
ordered from Beam since launch and the sharp increase in Australia-
only subscribers to around 1,300 – most of whom were acquired in
FY2021. The subscriber base in North America is many times higher, as
the region was not impacted as much by COVID-19 lockdowns, and the
traction ZOLEO has achieved in those markets point to a bright future for
Australian subscriptions, given the similarities between these markets
and shared knowledge with our JV partner.
As Beam adds new subscribers from its territories, which includes
Australia, New Zealand, Japan and China, its profit margins are expected
to expand thanks to our enhanced leverage in sourcing raw materials
and broader economies of scale. Beam collects 70% of the gross margin
from subscriptions in its territories with the balance remaining in its 50%
owned joint venture, ZOLEO Inc, that it co-owns with Canadian company
Roadpost Inc.
With the world facing seismic supply and demand disruptions,
geopolitical uncertainties and economic plight, I am sincerely delighted
that the Company of which I am proud to be the Chairman, and of which
our investors are primary stakeholders, has not only navigated these
treacherous waters, but emerged stronger and bolder than ever before.
The six-fold increase in ZOLEO Inc.’s FY2021 revenue to $13.5 million
underscores the success of the messaging solution across the two
continents, with sales from new markets to follow in the current
financial year.
I can certainly understand why some may wish to forget the 12 months
to 30 June 2021, but this most recent financial year is one I will,
when it comes to Beam, be pleased to remember. They were times of
commitment, adaptation and sacrifice, but at a corporate level we are
now well capitalised, served by a loyal and highly engaged management
team and staff. Beam has strong winds in our sails leading into crucial, and
exciting, times for your company.
I am therefore pleased to provide the following Chairman’s Report on
the Beam Communications Holdings Group of companies for the year
ended 30 June 2021, reflecting a snapshot of Beam’s important pivot to
becoming a significant recurring revenue Company. The full Directors’
Report contains more extensive information on the Group’s performance
in the financial year, but I would like to present the following highlights.
It wasn’t only ZOLEO device sales that drove our numbers. Beam’s
wholly-owned subsidiary and Telstra’s largest satellite equipment
provider, SatPhone Shop, also contributed to the Group’s financial
performance with sales jumping 27.5% over the previous year.
There were a few reasons for the improved sales. SatPhone Shop
received additional orders from medium-sized business customers and
semi-government entities, and the business benefited from sales of
ZOLEO devices where, like other retail partners, it pockets a reasonable
margin on the hardware sale.
The ongoing success of Iridium GO! was another positive for the
Group. Beam received an order for 5,000 Iridium GO! devices from its
long-standing partner and leading satellite services company Iridium
Communications Inc (NASDAQ: IRDM) during FY2021.
2 BEAM COMMUN ICATIONS HO L DIN GS L IM I T ED
The momentum is carrying through to the current financial year as
Beam has received its ninth - and largest to date - Iridium GO! order in
July 2021. This order for 7,500 units of the enduringly popular portable
satellite hotspot comes as Iridium expects demand for the highly reliable
smartphone-to-satellite connectivity device to remain healthy for years
to come.
While unit sales of ZOLEO have proved one of our largest sources of
revenue for this period, it is the profitability and expertise behind our
organic business sales that has underwritten our profitable performance.
The expenditure on major development projects in the financial year
amounted to $2.5 million. That is a significant figure, committed
cautiously and with rigorous oversight. We do not do so lightly, or
without firm and justified beliefs that this investment will be rewarded.
The Board also believes that Beam presently has sufficient available
resources to fund its current growth program. We were already mindful
of the challenges cashflows present, well before COVID, but you can
be assured that your Board adopts a granular and very forward-looking
approach to all its financial needs.
Outlook
The ongoing and ever evolving COVID-19 situation makes it unwise to
provide a precise outlook, but the Board and I are confident that Beam
can sustain the momentum it has built and deliver a stronger result in the
current financial year. Our performance horizon extends well beyond the
next 12 months and we are determined for that trajectory to continue
well beyond FY2022.
There are several reasons for this optimism, not least of which is ZOLEO.
While the harsh COVID lockdowns in New South Wales and Victoria
could weigh on net subscriber growth in the very short-term, the selling
proposition remains appealing, support from our partners is only growing
and a return to a semblance of normality will provide the atmosphere for
ZOLEO subscription revenues to grow – a lot.
This is true in the countries where ZOLEO was initially launched, namely
the United States, Canada and Australia, but also in new markets. Beam
has only recently launched ZOLEO into New Zealand and the JV is
on track to start selling the device in the United Kingdom and select
European markets early in calendar 2022.
Meanwhile, Beam is expecting demand for Iridium GO! to remain
enthusiastic as feedback from Iridium indicates that demand for the
device is exceeding expectations, due to strong organic growth in the
personal communication devices market, which Iridium is forecasting to
grow at a 29% compound annual growth rate (CAGR) to 2025, and the
reopening of several countries from COVID restrictions.
Supplementing this growth is the new range of Iridium satellite devices
that Beam is developing. These next-generation devices, called Iridium
Certus®, are capable of faster data speeds. If sales of Beam’s Certus
devices were even to imitate, let alone exceed, the success of the
Iridium GO!, the upside to Beam from executing the opportunity will be
significant for many years to come.
This is particularly important because Beam is exploring the possibility
of introducing value added services, together with the hardware. These
potential services will provide the Group with an additional recurring
revenue stream in addition to the hardware sales to Iridium.
We know, and have been not infrequently told, that a business model that
targets and generates such revenue streams will attract stronger interest
from the investment community than a mere unit designer and deliverer.
So that’s what we’re delivering.
Cash and Funding
Directors and Investors
All directors of your Company hold shares in Beam Communications
Holdings Limited. Like all shareholders, we have a personal interest in
the future performance of the Group.
You can read more about all members of the board in the Directors’
Report.
Beam issued 21.27 million new shares and 8.59 million options with an
exercisable price of $0.50 and expiring on 31 December 2022 as part of
the share placement.
Staff and Board
In the last financial year, your company has successfully traversed a
global pandemic and transitioned into a faster growing technology group,
with a significant recurring revenue business. Not only has Beam’s staff
and Board helped put the Group on the right path to growth, but they
have each made temporary personal remuneration sacrifices, when the
swell of the pandemic threatened to overwhelm many.
Now, they have also produced a record revenue and PBT for Beam.
Words alone cannot express my gratitude and admiration for the tireless
dedication shown by the many who work for Beam, each of whom have
played a critical role in no small way in steering the Group through such a
critical juncture.
While there are many more challenges ahead, the foundations have been
laid that will allow Beam, over the medium-term, to transform into a
coveted business that is many times larger and more profitable than it is
today. Indeed, I think our story is compelling.
Some shareholders are veterans, and I thank each of you for your support
and fervour.
Some investors have only recently joined our register, and to you, I
welcome you and look forward to rewarding your confidence.
I thank you for your ongoing support and belief in the future direction
of our Company as we progress to becoming a major player in the global
PCD industry.
Anchors away.
Beam’s cash holdings at 30 June 2021 were $3.7 million following its
successful share placement in the December quarter, which saw demand
heavily exceed expectations. This brings the Group’s total available cash
balance to $5.4 million, if undrawn debt facilities were included.
Additionally, in Q4 of FY2021, Beam recorded its seventh consecutive
quarter of positive operating cash flow, despite the disruption caused by
COVID-19 and the investment made to support the launch and uptake of
ZOLEO here in Australia.
Mr Simon Wallace
Chairman
Date: 14/09/21
Ann ua l Repo rt 2021 3
DIRECTORS’ REPORT
Directors present their report on the
Company and its controlled entities for
the financial year ended 30 June 2021.
DIRECTORS
The persons who have been a Director of
the Company since the start of the financial
year to the date of this report are:
Simon Lister Wallace
Michael Ian Capocchi
Carl Cheung Hung
(retired 30 November 2020)
David Paul James Stewart
The qualifications, experience and special
responsibilities of each of the directors
who held office during the year are:
Simon Lister Wallace
Chairman
Age: 47
Simon Wallace is a corporate lawyer and, based
in Melbourne, having previously been an equity
partner of the largest law firm in the world, he
is now the founder & Managing Partner of his
own boutique legal practice.
With extensive legal and commercial
proficiency, and particular expertise in the
areas of project finance, fundraising and
corporate governance, Simon has substantial
professional experience in the areas of
investment banking, structured and direct
equity investments, product formulation
and sales.
Simon is admitted to practice as a barrister and
solicitor of the Supreme Court of Victoria, the
Federal Court of Australia and the High Court
of Australia, and he holds degrees from the
Australian National University in both Law and
Commerce.
Since its inception in August 2018, Simon has
been a Director of Zoleo Inc. the joint venture
entity of which Beam is a 50% partner with
Roadpost Inc of Canada.
Simon Wallace has been a Director of Beam
Communications Holdings Limited since 5
February 2015 and was elected Chairman on
22 December 2016.
Michael Ian Capocchi
Managing Director
David Paul James Stewart
Carl Cheung Hung
Non Executive Director
Non Executive Director
(retired on 30 November, 2020)
Age: 37
Age: 50
Age: 67
Michael Capocchi has over 25 years’ experience
David Stewart is an experienced CEO and
Carl Hung has a Bachelor of Commerce degree
in the ICT industry and has held several senior
successful entrepreneur with more than 30
from the University of British Columbia and
management positions. Michael is based in
years in management and business leadership
an Executive MBA from University of Western
Chicago, USA, which places him closer to the
roles. David founded Banksia Technology Pty
Ontario’s Richard Ivey School of Business. He
important centres for satellite communications
Limited in 1988 and successfully managed the
is a Six Sigma Black Belt certified by SGS. He is
in the USA and UK/Europe.
company as a fast growing and highly profitable
also a Certified Management Accountant.
business. In 1996 to 1997 he instigated the
Michael joined Beam Communications
successful takeovers of several competitors,
Carl is President and CEO of Season Group
Holdings Limited as the General Manager of the
including NetComm Limited. David assumed
International Inc, a global Electronic
subsidiary, Beam Communications Pty Ltd, in
the role of CEO and Managing Director
Manufacturing Services provider with footprint
2003 and was appointed as Managing Director
until retiring in 2016. A year later David was
in Hong Kong, China, Malaysia, Mexico and
of Beam Communications Holdings Limited in
appointed as a Non-Executive Director of
the UK. Season Group has been the preferred
March 2008.
NetComm Wireless Limited, a position he held
contract manufacturer for Beam for several
until June 2019 when NetComm was acquired
years and has been instrumental in rationalising
Prior to joining Beam, Michael was the Regional
by US-based Casa Systems.
Beam’s manufacturing and supply processes.
Sales Director for Iridium Satellite LLC, directly
managing the sales, distribution and channel
In 2016 David was recognised for his significant
Carl was a Director of Beam from 21 February
management strategies for the Asia-Pacific
and valuable contribution to the Australian
2013 until retiring on 30 November 2020.
region. Michael has held senior management
communications industry with the presentation
positions as the Sales and Marketing Director
of the Communications Ambassador 2016
of Pacific Internet responsible for establishing
award. The Australian Communications
the Australian operations of the company and
Ambassador award is the highest honour
with Optus Communications.
presented by ACOMMS Communications
Alliance and CommsDay each year.
Since its inception in August 2018, Michael has
been a Director of Zoleo Inc. the joint venture
Since retiring, David has worked with several
entity of which Beam is a 50% partner with
tech startups in an advising and investing
Roadpost Inc of Canada. Michael Capocchi is
capacity. He was Chairman of Pycom from 2017
an integral part of the Beam business, including
until retiring from the board in July 2021.
managing the day to day operations of the
David joined the board of Lockbox Technologies
group which occasions extensive domestic and
in 2018 until the company was taken over
international travel when possible.
in May 2020 and in August 2019 he was
announced as a board member for MyNetFone
Group Limited.
David Stewart has been a Director of
Beam Communications Holdings Limited
since November 2017 following a substantial
investment.
Ann ua l Repo rt 2021 5
DIRECTORS’ REPORT
INDEMINIFCATION OF DIRECTORS
AND OFFICERS
During the year, the economic entity has
paid premiums in respect of an insurance
contract to indemnify its directors and officers
against liabilities that may arise from their
positions. Directors and officers indemnified
include the Company Secretary, all directors
and all executive officers participating in the
management of the economic entity.
Further disclosure required under section
300(9) of the Corporations Law is prohibited
under the terms of the insurance contract.
DIRECTORSHIPS OF OTHER LISTED
COMPANIES
David Stewart was a non-executive director of
NetComm Wireless Limited until June 30, 2019
and has been a non-executive director
of MyNetFone Group Limited (ASX:MNF)
since August 14, 2019. No other director of
Beam Communications Holdings Limited has
been a director of a listed company in the
three years immediately before the end of
the financial year.
COMPANY SECRETARY
Dennis Frank Payne has held the position of
Company Secretary since 2010. Dennis joined
the Company in 2005 and has also served
since that date as Chief Financial Officer. Prior
to joining Beam Communications Holdings
Limited Dennis held senior financial and
commercial roles at Cadbury, Schweppes and
Optus Communications. He has a Bachelor of
Economics and is a qualified CPA.
PRINCIPAL ACTIVITIES
The activities of the company and its controlled
entities during the year were the development
and marketing of a range of communication
products and services, mainly satellite based.
6 BEAM COMMUN ICATIONS HO L DIN GS L IM I T ED
Ann ua l Repo rt 2021 7
DIRECTORS’ REPORT
OPERATING RESULTS AND REVIEW
OF ACTIVITIES
The Consolidated Group reports a total
comprehensive income of $509,178 for the
FY2021 year on total revenue and other
income of $19,525,078 (2020: net loss of
$1,629,234 on total revenue and other income
Revenue
Other income
Deduct:
2021 ($000)
2020 ($000)
$18,497
$1,028
$14,923
$1,918
of $16,841,164).
Cost of goods sold, research & development,
administrative marketing and corporate
$(17,535)
$(13,565)*
$1,990
$3,276
$(810)
$(200)
$(200)
$780
$(271)
$509
$(4,311)
$(211)*
$(272)*
$(1,518)
$(112)
$(1,629)
Performance and Profit
expenses
Beam Communications Holdings achieved
record revenue for the year ended 30 June
2021 which has been driven by hardware sales
of ZOLEO devices to its joint venture entity and
Operating profit before
amortisation, depreciation,
interest and tax
ongoing organic growth across other key areas
Deduct:
of its business.
Amortisation and impairment
Group revenue including other income
increased by 16% to an all-time high of $19.5
million, with trading revenue increasing by 24%
to $18.5 million. Net profit after tax (NPAT)
Depreciation
Interest
improved to $509,178 from a loss of $1.6
Operating profit/(loss)
Net tax benefit/(expense)
Net profit/(loss) for year
million in FY2020 and profit before tax (PBT)
increased by $2.3 million to $780,447 over
the period.
A significant increase in sales of the Beam
designed and developed ZOLEO device to
its joint venture (JV) is the primary driver for
the strong revenue performance. A superior
depreciation and amortisation profile in
FY2021 and the one-off write-down that
impacted on FY2020 profits were the biggest
factors behind the large swing to profit. In
FY2020 Beam took the prudent measure
of writing down $1.97m in capitalised
development expenses relating to Thuraya WE,
Total comprehensive income/(loss)
for year
$509
$(1,629)
* In FY2020 in this table the Group reported Depreciation as $53,000 which was depreciation
without notional depreciation on right of use assets, and Interest as $163,000 which was interest
before notional interest on an interest free loan, giving EBITDA of $3,009,000, in order to coincide
with the figures reported in FY2019.
which is the principal reason for Beam’s final
As highlighted in previous announcements,
Importantly, EBITDA margins are expected to
net loss in that year.
Beam sells the ZOLEO device on a slim
improve materially as subscription revenues
margin to encourage consumer adoption as
start to be reflected in Beam’s accounts from
Negligible amounts of recurring subscription
subscriptions are the key profit driver for
FY2022 onwards. Subscription revenues
revenue were reflected in the Group’s FY2021
this innovative offering. The Group reported
are high margin and tend to be sticky, while
accounts, but that will change from the current
earnings before interest, tax, depreciation and
there is substantial operating leverage in the
financial year onwards.
amortisation (EBITDA) of $2 million in FY2021
ZOLEO business where margins will increase
versus over $3 million the year before.
exponentially in line with significant increases
Beam invoiced 33,919 ZOLEO devices in
in subscriber numbers.
FY2021, which represented a more than five-
However, Beam’s FY2021 EBITDA would be
fold increase over FY2020, as demand for the
ahead of the previous year if not for the fact
At the end of FY2021, the number of Australian
seamless global messaging solution in North
that Beam received a substantially larger
ZOLEO subscribers grew, during very strict
America and Australia accelerated and as
Research and Development (R&D) grant
COVID-19 lockdowns, to around 1,300, while
more major retailers in these markets started
stocking ZOLEO.
payment from the government in FY2020 and if
the Australian average revenue per user
the Group did not invest additional resources in
(ARPU) continued to hover at around $45
FY2021 to support the sharp ramp-up in sales
a month.
in ZOLEO.
8 BEAM COMMUN ICATIONS HO L DIN GS L IM I T ED
DIRECTORS’ REPORT
The growth in its Australian subscriber base
Cash and Funding
Outlook and Projects
in FY2021 coincided with Beam’s partnership
with two major Australian retailers – Anaconda
Group and Australia Post Group. Anaconda
is a leading outdoor equipment retailer with
around 68 stores across the country, while
Australia Post has started selling ZOLEO at
approximately 100 of its regional outlets
Beam’s cash holdings at 30 June, 2021, were
Notwithstanding the ongoing impact of the
$3.7 million (FY2020: $874,000) and the
COVID-19 pandemic on Beam’s operations
Company had a further $1.7 million
and the global economy, Beam believes it can
in available, but undrawn, debt facilities.
continue to build on the momentum it achieved
The increase in cash follows a successful
result for FY2022. There are a few reasons for
in the previous year and deliver an improved
under the first phase of the rollout. There are
circa $5 million share placement to high net
the positive outlook.
over 4,000 Australia Post shops in the network
worth and institutional investors in December
and more than half of these are in regional
communities that could find the ZOLEO service
quarter 2020. Beam also recorded an increase
Chief among them is the ongoing growth of
in customer cash receipts from its ordinary
ZOLEO with the unique solution launching
particularly useful.
activities with the Company posting seven
into new markets in the current financial year.
consecutive quarters of positive operating
ZOLEO is on track to enter the United Kingdom
Meanwhile, Beam’s wholly-owned subsidiary
cash flow.
and select European markets early in the new
year, while ZOLEO has been available in the
and the largest Telstra satellite equipment
provider, SatPhone Shop, also contributed
to the positive results with sales jumping
27.5% over the previous year. The growth was
particularly pronounced in the last quarter
of FY2021 due to orders from medium-sized
business customers and semi-government
entities.
Sales of ZOLEO through SatPhone Shop
provided another tailwind for the division.
SatPhone Shop, like other retailers,
collect a good profit margin on sales of the
ZOLEO device.
Additionally, sales of Beam’s other equipment
(apart from ZOLEO) were consistently strong
compared to the previous financial year. The
Company received its eighth order for 5,000
Iridium GO! devices in September 2020 from
its longstanding partner and leading satellite
services company Iridium Communications Inc
(NASDAQ: IRDM). Beam continued to receive
orders for the portable satellite hotspot post
June 30, 2021, and this takes the total number
of Iridium GO! units ordered from Beam to
57,500 since its launch in 2014.
While sales of Beam-branded equipment (such
as fixed terminals, docking units, handsets
and accessories) fell 10% in FY2021, this was
still better than expected given the global
impacts of COVID-19 on the enterprise and
government sectors, specifically in maritime
applications.
During the financial year, Beam was given two
New Zealand market since early August.
three-year $500,000 loans from the National
Australia Bank as part of the Australian
Beam and its JV partner Roadpost Inc. will
government’s COVID-19 business support
share the gross margins from subscriptions in
program. Beam has repaid these loans and
the UK and Europe equally, while Beam gets
converted them into a $1 million re-drawable
70% of gross margins from its territories, which
five-year partially secured loan facility.
include Australia, New Zealand, China and
Beam capitalised $2.5 million in development
Japan.
costs relating to ZOLEO and Iridium Certus®
Further, Beam is developing the next-
and received the federal government’s R&D tax
generation of Iridium satellite devices called
credit of $689,703 in FY2021.
Iridium Certus®, which are capable of
faster data speeds. The development and
launch of these new devices are significant
given the persistent popularity of its Iridium
GO! device over the past seven years, and
the fact that Beam may have the opportunity
to introduce value added services to such
offerings to generate a new stream of recurring
income.
SatPhone Shop is also positioned to contribute
positively to Beam’s growth in FY2022. The
growth momentum it experienced in the
previous financial year, particularly in the
fourth quarter, has persisted into the current
financial year.
Meanwhile, Beam continues to receive orders
for the Iridium GO! device. The Company was
given its largest order to date for 7,500 units
from Iridium in July and Beam is anticipating
ongoing orders for Iridium GO! even after the
launch of new Certus® devices.
Ann ua l Repo rt 2021 9
DIRECTORS’ REPORT
Directors and Investors
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
Beam issued 21,272,000 new shares and
8,590,667 unquoted options exercisable at
$0.50 and expiring on 31 December 2022 as
part of its share placement to sophisticated
and institutional shareholders during the
course of the 2021 financial year. In addition,
Mr Capocchi exercised 907,500 options on 30
November 2020.
Mr Simon Wallace, a shareholder in the
Company, has been a Director for six years
and is currently the Non-Executive Chairman
of the Board. Simon has lengthy and detailed
expertise in legal and commercial matters and
leads the Board and the Group in fund raising
activities, strategic and corporate governance
advice.
Mr David Stewart joined our board as a Non-
Executive Director in November 2017. David
Other than those noted above there were no significant changes in the state of affairs of the
Consolidated Group during the financial year.
EVENTS AFTER REPORTING DATE
There have been no significant events since 30 June 2021.
DIVIDENDS PROPOSED OR RECOMMENDED
No dividends were paid or declared since the start of the financial year. No recommendation for
payment of dividends has been made.
ENVIRONMENTAL ISSUES
The Consolidated Group’s operations are not regulated by any significant environmental regulation
under any Commonwealth, State or Territory laws.
FUTURE DEVELOPMENTS
The company will continue the development of the Satellite Communications Services and
related businesses.
has been a keen advisor to senior management
SHARES ISSUED ON THE EXERCISE OF OPTIONS
in the rationalisation of development
expenditure, providing experienced insight into
the communications industry both in Australia
and overseas. David remains Beam’s major
shareholder, holding 14.53% of the shares and
assists the Group to expand in the satellite and
non-satellite space.
Mr Michael Capocchi is an Executive Director
and holds the positions of Managing Director
and Chief Executive Officer for all companies
in the Group. His base in the USA enables him
to easily visit the Middle East and UK/Europe,
where many core clients are based, as well
as domestically within the US. Michael who
travelled to Australia every four to six weeks
prior to Australia’s travel restrictions, has seen
little interruption to his utility and client access
as a result of COVID19 and retains direct and
daily contact with management. Michael is also
a significant shareholder in the Company.
907,500 ordinary shares of the Company were issued during the year ended 30 June 2021
following the exercise of options. Further details in Note 16 (b).
DIRECTORS’ INTERESTS
The relevant interests of the Directors in the securities of the Company are detailed in the
Remuneration Report as part of the Directors’ Report.
SHARES UNDER OPTION
At the date of this report, the unissued ordinary shares of the Company under option
are as follows:
Issue Date
Date of expiry
Exercise Price
Number Under Option
9.12.20
9.12.20
31.12.22
31.12.22
$0.50
$0.50
7,090,667
1,500,000
8,590,667
DIRECTORS’ MEETINGS
Mr Carl Hung retired from Beam’s board as a
Committee meetings). Attendances by each Director during the year were:
During the year ended 30 June 2021 the Company held 16 meetings of Directors (including Audit
Non-Executive Director on 30 November 2020
but remains a key shareholder with 7.21% of
the Company’s shares.
The Directors believe the Group is well placed
to continue to build on the underlying profit
growth achieved over the past few years,
particularly with its new range of products and
services that have either just been launched or
will be commercialised in the short- to medium-
term.
Director
M Capocchi
D Stewart
C Hung
S Wallace
Directors Meetings
Committees
Attended Maximum Possible
Attended
Attended
Maximum
Possible Attended
13
13
7
13
13
13
7
13
0
1
2
3
0
1
2
3
Each Director attended every scheduled meeting of the Board and of each Committee of which he is a
member while in office.
10 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
REMUNERATION REPORT (Audited)
Performance Bonus
This report details the nature and amount of
remuneration for each director of Beam
Communications Holdings Limited, and for the
executives receiving the highest remuneration.
The purpose of a performance bonus is to reward an individual’s actual achievement of
performance objectives and for materially improved Company performance. Consequently,
performance-based remuneration is paid where a clear contribution to successful outcomes
for the Company is demonstrated and the individual attains and excels against pre-agreed key
performance indicators during a performance cycle.
DIRECTORS’ REPORT
For FY2021 the Managing Director had a performance bonus potential of 10% of the Group
operating profit before interest, tax, depreciation, and amortisation (EBITDA) above $1,000,000
for the financial year, plus $20,000 and a 1% increase in fixed salary for FY2022, upon the
achievement of each of 5 KPIs set by the Board at the beginning of the financial year. The Group
achieved an EBITDA of $1,990,880 and therefore the performance bonus becomes payable. In
addition, the Managing Director achieved 4 of the KPIs. From May 2020 until October 2020
employees contributed 20% of their salary payments to COVID-19 relief savings and the Managing
Director agreed to reduce his FY2020 bonus payment, which became payable during FY2021, by
50%.
Two senior sales executives, who have contractual performance-based bonus entitlements and
who achieved above their minimum sales-related target levels in FY2020 also agreed to reduce
their bonus payments by approximately 50%. These executives achieved above their minimum
sales-related target levels in FY2021. No other key management executive has a contractual
performance bonus entitlement.
In assessing the relative performance of the senior executives and the Group as a whole measured
against the primary objective of enhancing shareholder value over time, the Board has regard
to key financial indicators. In accordance with Section 300A of the Corporations Act 2001 the
following table summarises the Group’s performance over the last 5 years.
2021
2020
2019
2018
2017
Net profit/(loss) before
780
(1,518)
722
(1,432)
(423)
tax ($’000)
EBITDA ($’000)
1,990
3,276
2,104
(607)
129
Basic earnings per share
0.76
(0.31)
Share price at 30 June ($)
0.235
Market Capitalisation at
17.64
30 June
0.17
8.99
0.64
0.27
14.28
(3.07)
(1.29)
0.16
8.46
0.13
5.61
Dividends per share
Nil
Nil
Nil
Nil
Nil
Remuneration Policy
The Company is committed to remunerating its
executive directors and senior executives in a
manner that is market-competitive, consistent
with best practice and which supports the
interests of shareholders. The Company aims
to align the interests of executive directors and
senior executives with those of shareholders
by remunerating through performance and
long-term incentive plans in addition to fixed
remuneration.
The remuneration of Non-executive Directors
is determined by the Board having regard
to the level of fees paid to non-executive
directors by other companies of similar size
and stature and in aggregate must not exceed
the maximum annual amount approved by the
Company’s shareholders, currently $500,000,
as determined at the General Meeting held
on 3 August 2007.
Senior executives’ remuneration consists of the
following elements:
- fixed salary;
- short-term incentive bonus where applicable
based on performance;
- long-term incentive share option scheme;
and:
- other benefits including superannuation.
Fixed Salary
The salary of senior executives is determined
from a review of the market and reflects core
performance requirements and expectations. In
addition, the Company considers the following:
- The scope of the individual’s role;
- The individual’s level of skill and experience;
- Legal and industrial obligations;
- Labour market conditions; and
- The complexity of the Company’s business.
Ann ua l Repo rt 2021 11
DIRECTORS’ REPORT
REMUNERATION REPORT
Employment Contracts
(continued)
Employment Contracts of Senior Executives
The Board believes the above table illustrates
the positive direction the Group has taken
over the past five years and is reflective of
the performance of senior executives during
that period. Due to the nature of the Group’s
business, there are often major influences on a
particular financial year’s profit result. In
FY2020, to focus development efforts on
ZOLEO improvements and Iridium Certus,
the Company terminated three development
projects and also wrote-off the remainder
of the Thuraya WE project’s capitalised value
at an allup cost of $1,925,000. In FY2021 the
Company continued that underlying positive
NPBT and NPAT trend achieving a record NPBT
and a very significant market capitalisation
The employment contract for the Managing Director/CEO was renewed and executed by the
Company and Michael Capocchi on 30 September 2020 with operative effect from 1 July 2020.
The contract has a minimum term of two years. The contract can be terminated by either the
Company or Mr Capocchi, with a minimum of 9 months’ notice, subject to completion of the
minimum term. The terms of Mr Capocchi’s contract include a fixed base salaryand a significant
portion of his total remuneration was set at risk based on achievement of EBITDA and five annual
KPIs.
All other key management personnel are permanent employees.
(a) Names and positions held of consolidated group and parent entity Key
Management Personnel in office at any time during the financial year are:
value at 30 June. This accommodated the major
Directors
capital raising and share issue completed in
December 2020 and provides recognition of
the fundamental strength in performance.
Mr S Wallace
Non-Executive Chairman
Mr M Capocchi
Executive Managing Director
Long-term Incentives
Mr D Stewart
Non-Executive Director
The Company’s Share Options Incentive Plan, in
Mr C Hung
Non-Executive Director
(retired on 30 November 2020)
which executive directors and senior executives
may participate, was approved by shareholders
on 27 October 2017 and authorises the
Directors to issue options in respect to up to
Other key management personnel
10% of the shares on issue at a given time.
Mr D Payne
Chief Financial Officer and Company Secretary
Mr W Christie
Chief Technical Officer
The Company ensures that the payment of
equity-based executive remuneration is made
in accordance with thresholds set in plans
approved by shareholders.
No options were issued to key management
personnel or Directors during FY2018 –
FY2021 while the Company evaluates the
effectiveness of share options as incentives.
Other Benefits
Senior executives are entitled to statutory
superannuation and other bonus payments
subject to the discretion of the Managing
Director and the Board.
12 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
(b) Details of remuneration for the year
The remuneration for each director and each of the other key management personnel of the consolidated group receiving the highest
remuneration during the year was as follows:
Short-term employee benefits
Cash salary
& fees
Cash
Motor
Employee
bonus &
vehicle & other
benefits
Commissions
allowances
payable [b]
employment
benefits
Superannu-
ation
Post-
Other long-
term
benefits
Employee
Termination
benefits
Eligible
benefits
termination
payable
benefits
Share-
based
payments
Options
[a]
Total
Performance
related
Remuneration
consisting of
options
2021
Directors
$
$
-
Mr S Wallace
61,111
Mr M Capocchi [c]
441,236
179,088
Mr C Hung
-
Mr D Stewart
27,777
-
-
Other
Mr D Payne
179,113
20,000
Mr W Christie
205,332
-
Total
914,9569
199,088
$
-
-
-
-
-
-
-
$
-
$
-
$
-
9,460
41,917
6,818
-
-
-
-
-
-
(1,727)
17,013
(9,198)
(1,952)
19,322
4,229
5,781
78,254
1,849
$
$
$
%
%
-
-
-
-
-
-
-
-
-
-
61,111
0.00%
0.00%
678,519
26.39%
0.00%
-
0.00%
0.00%
27,777
0.00%
0.00%
205,203
9.75%
0.00%
226,931
0.00%
0.00%
1,199,541
Post-
Other long-
Short-term employee benefits
employment
benefits
Cash
salary &
Cash
bonus &
fees
Commissions
Motor
vehicle &
other
allowances
Employee
benefits
Superannuation
payable [b]
term
benefits
Employee
benefits
payable
$
$
-
$
-
$
-
$
-
$
-
Mr S Wallace
40,277
Mr M Capocchi [c]
448,645
160,684
4,906
34,220
43,087
9,778
Mr C Hung
31,250
Mr D Stewart
31,250
Other
Mr D Payne
187,420
Mr W Christie
185,386
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(2,876)
17,767
(13,155)
12,187
17,574
16,742
Termination
Share-based
benefits
payments
Eligible
termination
Options [a]
Total
benefits
Performance
related
Remuneration
consisting of
options
$
$
$
%
%
-
-
-
-
-
-
-
-
-
-
-
-
-
40,277
0.00%
0.00%
701,320
22.91%
0.00%
31,250
0.00%
0.00%
31,250
0.00%
0.00%
189,156
0.00%
0.00%
231,889
0.00%
0.00%
-
1,225,142
924,228
160,684
4,906
43,531
78,428
13,365
Option based compensation relates to the value of options issued to date and brought to account pro-rata to the time period from the date of
granting to the date of vesting, except where Accounting Standard AASB 2 required expensing to begin from the commencement of service related
to those options, notwithstanding that the issue of those options, in the case of Directors was subject to shareholder approval, and in the case of key
management employees, subject to performance review.
Employee benefits payable represents net increase in benefits payable charged to the consolidated statement of profit or loss and other comprehensive
income in the current year.
The majority of Mr Capocchi’s remuneration is in US dollars. For 2021 his remuneration has been converted into AU dollars at the exchange rate on 30
June 2021 of 0.7518.
Ann ua l Repo rt 2021 13
2020
Directors
Total
[a]
[b]
[c]
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
(c) (i) Options granted as part of remuneration for the year
2021
Grant date
Granted
number
Value per
option at grant
date
$
Value of
options
granted during
the year
$
Value of
options
exercised
during year
$
Value of
options lapsed
during year
$
Directors
Mr S Wallace
Mr M Capocchi
Mr C Hung
Mr D Stewart
Other
Mr D Payne
Mr W Christie
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(229,598)
-
-
-
-
2020
Grant date
Granted
number
Value per
option at grant
date
$
Value of
options
granted during
the year
$
Value of
options
exercised
during year
$
Value of
options lapsed
during year
$
Directors
Mr S Wallace
Mr M Capocchi
Mr C Hung
Mr D Stewart
Other
Mr D Payne
Mr W Christie
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
14 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
(21,916)
(21,916)
(31,309)
(31,309)
Total
$
-
(229,598)
-
-
Total
$
-
-
-
-
-
-
-
-
-
-
-
-
(21,916)
(21,916)
(31,309)
(31,309)
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
(c) (ii) Options granted and/or vested during the year
Terms & conditions for each grant
2021
Vested No.
Granted No.
Grant date
Value per
option at
grant date $
Exercise price $
Expiry date
First
exercise
date
Last exercise
date
Directors
Mr S Wallace
Mr M Capocchi
Mr C Hung
Mr D Stewart
Other
Mr D Payne
Mr W Christie
Total
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2020
Vested No.
Granted No.
Grant date
Value per
option at
grant date $
Exercise price $
Expiry date
First
exercise
date
Last exercise
date
Terms & conditions for each grant
Directors
Mr S Wallace
Mr M Capocchi
Mr C Hung
Mr D Stewart
Other
Mr D Payne
Mr W Christie
Total
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Ann ua l Repo rt 2021 15
DIRECTORS’ REPORT
REMUNERATION REPORT (continued)
(d) Option holdings
The number of options over ordinary shares in the Company held during the financial year by each key management person including their personally
related parties is set out below.
Balance
1.07.20
Granted as
Remuneration
Issued as
Equity
Investment
Options
Exercised
Options
Lapsed
Balance
30.06.21
Total Vested
30.06.21
Exercisable
30.06.21
Unexer-
cisable
30.06.21
2021
Directors
Mr S Wallace
-
Mr M Capocchi
907,500
Mr C Hung
Mr D Stewart
-
-
Other
Mr D Payne
190,575
Mr W Christie
272,250
Total
1,370,325
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(907,500)
-
-
-
-
-
-
-
-
(190,575)
(272,250)
-
-
-
-
-
-
(907,500)
(462,825)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Balance
1.07.19
Granted as
Remuneration
Issued as
Equity
Investment
Options
Exercised
Options
Lapsed
Balance
30.06.20
Total Vested
30.06.20
Exercisable
30.06.20
Unexer-
cisable
30.06.20
2020
Directors
Mr S Wallace
-
Mr M Capocchi
907,500
Mr C Hung
Mr D Stewart
-
-
Other
Mr D Payne
381,150
Mr W Christie
544,500
Total
1,833,150
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
907,500
907,500
907,500
-
-
-
-
-
-
(190,575)
190,575
190,575
190,575
(272,250)
272,250
272,250
272,250
-
(462,825)
1,370,325
1,370,325
1,370,325
-
-
-
-
-
-
-
16 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
REMUNERATION REPORT (continued)
(e) Share holdings
The number of shares in the Company held during the financial year by each key management person including their personally related parties
DIRECTORS’ REPORT
Mr D Stewart
10,905,000
are set out below.
2021
Directors
Mr S Wallace
Mr M Capocchi
Mr C Hung (b)
Other
Mr D Payne
Mr W Christie
2020
Directors
Balance
1.07.20
Received as
Remuneration
Options
Exercised
Placement
Issue
Net Change
Other [a]
Balance
30.06.21
200,000
1,603,899
5,409,874
328,570
62,778
18,510,121
-
-
-
-
-
-
-
-
907,500
-
-
-
-
907,500
-
-
-
-
-
-
-
-
160,498
-
-
-
-
200,000
2,671,897
5,409,874
10,905,000
328,570
62,778
160,498
19,578,119
Balance
1.07.19
Received as
Remuneration
Options
Exercised
Placement
Issue
Net Change
Other [a]
Balance
30.06.20
Mr S Wallace
178,600
Mr M Capocchi
1,603,899
Mr C Hung
9,243,207
Mr D Stewart
10,540,000
Other
Mr D Payne
Mr W Christie
328,570
62,778
21,957,054
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
21,400
200,000
-
1,603,899
(3,833,333)
5,409,874
365,000
10,905,000
-
-
328,570
62,778
3,446,933
18,510,121
[a]
[b]
Net Change Other refers to shares purchased or sold on-market or off-market at current market prices during the financial year.
Carl Hung retired on 30/11/2020 and was no longer a director at the end of the 2021 financial year.
(f) Shares issued on exercise of remuneration options
Mr Capocchi exercised options on 30 November 2020 at an exercise price of 19.5 cents. The options were issued in 2015.
(g) Voting and comments made at the Company’s 2020 Annual General Meeting (AGM)
At the Company’s most recent AGM, a resolution to adopt the prior year remuneration report was put to the vote and at least 75% of ‘yes’ votes were
cast for adoption of that report. No comments were made on the remuneration report at the AGM
Ann ua l Repo rt 2021 17
DIRECTORS’ REPORT
AUDITOR
RSM Australia Partners continues in office in accordance with section 327 of the Corporations Act 2001.
NON AUDIT SERVICES
No non audit services were undertaken by the external auditors during the year ended 30 June 2021.
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.
Signed in accordance with a resolution of the Board of Directors dated 30 August 2021.
Mr Simon Wallace
Chairman
Date: 30 August 2021
18 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
RSM Australia Partners
Level 21, 55 Collins Street Melbourne VIC 3000
PO Box 248 Collins Street West VIC 8007
T +61 (0) 3 9286 8000
F +61 (0) 3 9286 8199
www.rsm.com.au
AUDITOR’S INDEPENDENCE DECLARATION
As lead auditor for the audit of the financial report of Beam Communications Holdings Limited for the year ended
30 June 2021, 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.
RSM AUSTRALIA PARTNERS
M PARAMESWARAN
Partner
Dated: 30 August 2021
Melbourne, Victoria
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
16
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the
RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
CORPORATE GOVERNANCE STATEMENT
The Directors of Beam Communications
Holdings Limited (BCC or the Company) are
committed to protecting and enhancing
• Directors are entitled to seek independent
professional advice.
• reviewing and ratifying systems of risk
management and internal compliance
shareholder value and conducting the
To assist in the execution of its responsibilities
company’s business ethically and in
the Board has established an Audit
accordance with the highest standards of
Committee with a formalised charter and
and control, codes of conduct and legal
compliance;
• monitoring senior management’s
performance and implementation of
corporate governance.
operating principles. Activities which may be
strategy, and ensuring appropriate
conducted by separate committees in a larger
In accordance with the ASX Corporate
company such as Directors Nomination, Risk
Governance Council’s Corporate Governance
Management and Remuneration are dealt
Principles and Recommendations: 4th Edition
(the Principles), this corporate governance
statement reports on the Company’s adoption
with by the full Board as separate and specific
agenda items in accordance with the principles
and policies set down in the Company’s
resources are available;
• dealing with approaches to take over the
company; and
• approving and monitoring financial and
other reporting.
of the Principles on an exception basis. This
corporate governance programme.
Chairman’s Appointment and Responsibilities
statement provides specific information
whereby disclosure is required of any
The Company has adopted a Board Charter
The Chairman is appointed by the Board from
recommendations that have not been adopted
which details the functions and responsibilities
by the Company, together with the reasons why
of the Board of Directors. A copy of the Board
they have not been adopted. The Company’s
Charter is on the Company’s website. The
corporate governance principles and policies
employment contract between the Company
are therefore structured with reference to the
and the Chief Executive Officer and the
Principles, which are as follows:
letter of engagement for the Chief Financial
Officer and senior executives details the
1. Lay solid foundations for management
terms of employment, job specifications and
and oversight.
responsibilities.
2. Structure the Board to be effective and
add value.
The Role of the Board of Directors
3. Instil a culture of acting lawfully, ethically
and responsibly.
The BCC Board is responsible to its
4. Safeguard the integrity of corporate
shareholders for the protection and
reports.
enhancement of long-term shareholder value.
5. Make timely and balanced disclosure.
6. Respect the rights of security holders.
7. Recognise and manage risk.
8. Remunerate fairly and responsibly.
To fulfil this role the Board is responsible for:
• oversight of the Group, including its
controls, risk management, financial
1. Lay Solid Foundations for Management and
Oversight
Recommendation 1.1: The Board and Senior
Management – Roles and Responsibilities
Board Processes
The Board recognises that its responsibilities
should accord with the following general
principles:
• the Board should be made up of a majority
of Independent Directors;
• the Chairman of the Board should be an
Independent Director;
• the roles of Chairman and Chief Executive
Officer should not be exercised by the
same person;
• the Board should meet on a monthly basis;
• all available information in connection
with items to be discussed at a meeting
of the Board shall be provided to each
Director prior to that meeting; and
structures and accountability systems;
• setting strategic direction for management
with a view to maximising shareholder
value;
• input into and final approval of strategic
plans and goal and performance objectives
and key operational and financial matters;
• determining dividend payments;
• selecting, appointing and reviewing the
performance of the Chief Executive
Officer (CEO);
• ratifying the appointment and, where
appropriate, the removal of the Chief
Financial Officer (CFO) and Company
Secretary;
• approval of annual and half yearly financial
reports and related Australian Securities
Exchange reports;
• selecting and appointing new non-
executive directors;
• approving major capital expenditure and
acquisitions;
• evaluating the Board’s performance and
that of individual directors;
the non-executive directors. The Chairman:
• provides appropriate leadership to the
Board and the Company;
• ensures membership of the Board
is balanced and appropriate for the
Company’s needs;
• facilitates Board discussions to ensure
the core issues facing the organisation are
addressed;
• maintains a regular dialogue and mentor
relationship with the Chief Executive
Officer;
• monitors Board performance; and
• guides and promotes the on-going
effectiveness and development of the
Board and individual directors.
Conduct of Board Business
The Board normally holds monthly formal
Board meetings and will also meet whenever
necessary to carry out its responsibilities. In the
year ended 30 June 2021, the Board and/or its
committees met 16 times. When conducting
Board business, Directors have a duty to
question, request information, raise any issue
of concern, and fully canvas all aspects of any
issue confronting the Company and vote on any
resolution according to their own judgment.
Directors keep confidential, board discussions,
deliberations and decisions that are not
publicly known.
Access to Information
Directors are encouraged to access members
of the senior management team at any time to
request relevant information in accordance
with protocols adopted by the Board. Where
Directors perceive an irregularity in a
Company related matter, they are entitled to
seek independent advice at the Company’s
expense. Directors must ensure that the costs
20 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
CORPORATE GOVERNANCE STATEMENT
are reasonable and must inform the Chairman
A CEO, if also a Managing Director, is not
the notice of the meeting at which the election
before the advice is sought. The advice must be
subject to retirement by rotation and is not
of the Director is to be held, or by including
made available to the rest of the Board.
to be taken into account in determining the
in the notice a clear reference to the location
Independent Professional Advice
other document lodged with ASX where the
rotation of retirement of Directors.
on the Company’s website, Annual Report or
Functions of Senior Executives
information can be found. Directors appointed
Each Director has the right to seek independent
by the Board must stand for re-election at the
legal and other professional advice at the
The Chief Executive Officer reports to the
next meeting of shareholders.
Company’s expense concerning any aspect of
Board and is responsible for the operation and
the Company’s operations or undertakings in
administration of the Company including the
Further information regarding Director
order to fulfil their duties and responsibilities
implementation of the Company’s strategies,
nominations can be found in the Company’s
as directors.
plans, policies and control programmes. He
Election of Directors Policy as posted on the
Conflicts of Interest
is supported by a management team whose
Company’s website.
responsibilities are delineated by formal
authority delegations. The team meets
Recommendation 1.3: Terms of Appointment –
Directors are required to continually monitor
regularly to co-ordinate activities and to
Directors and Senior Executives
and disclose any potential conflicts of interest
review and monitor performance.
that may arise. Directors must:
• disclose to the Board any actual or
potential conflicts of interest that may
exist as soon as the situation arises;
• take necessary and reasonable steps to
resolve any conflict of interest within an
Recommendation 1.2: Board Nominations
receive a letter formalising their appointment
Each new Non-Executive Director will
Appointment of Directors
and outlining the material terms of their
appointment. Non-Executive Directors of the
Company have not been appointed for fixed
The Company has not established a nomination
terms. Senior Executives will generally have
appropriate period, if required by the
committee for recommending the appointment
written employment agreements with the
Board or deemed appropriate by that
of Directors.
Company setting out their duties, obligations
director; and
• comply with the Corporations Act
requirements about disclosing interests
Given the nature and size of the Company, the
Board considers that as a three-member Board
The above-mentioned appointment letter
and remuneration.
and restrictions on voting.
of a small public company the selection and
and employment agreements are with the
appointment of Directors is such an important
Non-Executive Director or Senior Executive
Directors should discuss with the Chairman
task that it should be the responsibility of
personally.
any other proposed Board or executive
the entire Board to consider the nominations
appointments they are considering undertaking
process. The structure of the Board is reviewed
The remuneration paid/payable to the
and advise the Company of their appointments
annually as to qualifications, skills, experience
Company’s ‘key management personnel’ is
to other companies as soon as possible after the
and diversity to ensure the Board has an
outlined within the Remuneration Report in the
appointment is made.
appropriate mix. In a three-member Board the
Company’s latest Annual Report.
highest requirement is for appropriate skill.
The same requirement exists for related party
Where a vacancy exists or there is a need for
Recommendation 1.4: The Company Secretary
transactions including financial transactions
particular skills, the Board will determine the
with the Company. Related party transactions
selection criteria and identify and appoint a
The Company Secretary is appointed by the
are reported in writing to the Company
suitable candidate. In this regard, the Company
Board and is responsible for developing and
Secretary and where appropriate, raised for
consideration at the next board meeting.
also notes that the Company operated with a
four-member Board for part of this financial
maintaining the systems and processes that are
appropriate for the Board to fulfil its role. The
year. Mr Carl Cheung Hung retired from the
Company Secretary is responsible to the Board
Retirement of Directors
Board on 30 November 2020 after having
for ensuring compliance with Board procedures
served as a Non-Executive Director on the
and governance matters. The Company
One-third of the Directors are required to
Board for nearly eight years.
Secretary is accountable directly to the Board,
retire by rotation at each Annual General
through the Chair, on all matters to do with the
Meeting (AGM). The Directors to retire at
The Company will undertake appropriate
proper functioning of the Board. The Company
each AGM are those who have been longest in
checks before appointing a person, or putting
Secretary is also responsible for overseeing and
office since their last election. Where Directors
forward a candidate for election as a Director,
co-ordinating disclosure of information to the
have served for equal periods, they may agree
and provide shareholders with this information.
ASX as well as communicating with the ASX.
amongst themselves or determine by lot
who will retire. A Director must retire at the
Candidates will be assessed through interviews,
meetings and background reference checks as
third AGM since last elected or re-elected. A
appropriate. External advisors may be used
Recommendation 1.5: Diversity Policy
Director appointed as an additional or casual
in this process. The Company will provide
The Company has taken measures to establish
director by the Board will hold office until
shareholders with all material information in its
a corporate culture in which the principles of
the next AGM when the Director may be re-
possession relevant to the decision on whether
diversity are embedded. By promoting and
elected. This re-election will be in addition to
or not to elect (or re-elect) a Director, either in
supporting transparent recruiting processes,
any rotational retirements.
Ann ua l Repo rt 2021 21
CORPORATE GOVERNANCE STATEMENT
flexible work practices, an enlightened code
undertaken during the reporting period.
the skills, experience and expertise that the
of conduct, equal employment opportunity
If the contribution of a Non-Executive Director
Board would look to maintain and build on:
policies and clear reporting of outcomes, the
appears to a majority of Directors to be less
• capital markets;
Board feels that the objectives of diversity will
than adequate, they may direct the Chairman
• corporate finance;
be achieved. The results of recruiting and the
to inform that Director accordingly and ask
• regulatory and compliance;
composition of staff are reported by the Chief
that person to consider his or her position
• operations;
Executive Officer and reviewed at monthly
on the Board. If the Director takes no action
Board meetings.
in response, a circulated minute signed by
• legal;
• sales;
a majority of Directors will authorise the
• marketing;
The Board, at this time, has not established
Company Secretary to inform the shareholders
• corporate governance; and
an explicit policy on diversity or measurable
that the Board will not support the re-election
• financial and business acumen.
objectives for achieving gender diversity.
of the Director at the general meeting where
Because of the size of the Company (40 staff
they are next due to offer for re-election.
Recommendations 2.3 and 2.4: Independent
including Board members, as at the date of this
Directors
report), the Board is of the view that the scale
Evaluating the Performance of Senior
and nature of the Company’s operations does
Executives
not currently lend itself to an effective and
Directors Independence
At the date on which the Directors’ report
meaningful application of a targeted diversity
Arrangements put in place by the Board to
is made out, the Company’s Board has three
policy.
monitor the performance of the Group’s key
Directors. The Board currently consists of two
Rather, the Board recognises the positive
benefits for the organisation of increased
• regular monthly reporting submitted to
the Board and attendance at all Board
executives include:
Non-Executive Directors. At this time only
one (Mr Simon Wallace) of the three Non-
Executive Directors is considered by the Board
diversity, especially gender, and has sought
Meetings by the Chief Executive Officer
to be independent, and as such the Company
to integrate diversity objectives within
the existing policies and procedures of the
Company. The Board intends to reconsider
and Chief Financial Officer;
• a review by the Board of the Group’s
financial performance and revised forecast
does not comply with Recommendation
2.4 of the Corporate Governance Council,
which recommends that a majority of Board
the adoption of a formal diversity policy
results on a monthly and annual basis
members should be independent. However,
periodically.
at Board meetings at which reports are
the Board considers that both its structure
At the date of this report the Company has
a total staff excluding Board members of 38
presented by the key executives; and
• an evaluation of the detailed presentations
made by the Chief Executive Officer
and composition are appropriate given the
size of the Group and that the interests of
shareholders are well met.
employees (including Chief Executive Officer
and his direct reports during business
and Managing Director) of which 26% (10
planning/ strategy meetings which are at
The Board regularly assesses its composition,
employees) are women. The Senior Executive
least bi-annual.
team is made up of 7 managers including Chief
having regard to the nature and size of the
Company’s operations and the relevant skills,
Executive Officer and Managing Director and
A performance evaluation was undertaken
knowledge, and experience of each Board
2 female managers. At this time there are no
during the reporting period.
member.
women on the Board which comprises three
positions.
2. Structure Board to Be effective and Add Value
In the interest of clear disclosure:
Recommendations 1.6 and 1.7 – Performance
Review and Evaluation
Recommendation 2.1: Nomination Committee
Due to the small size of the Board and the
• Mr Carl Hung, who served as a Non-
Executive Director until his retirement on
30 November 2020, is also the President
Evaluating the Performance of Directors
Company does not have a separate nomination
has subcontracted manufacturing on an
committee. Nominations for positions on the
arms-length basis to Season Group and
The Board has adopted a self-evaluation
Board are considered by the entire Board.
Mr Hung, through SGV1 Holdings Limited,
Company’s current level of operations, the
and CEO of Season Group. The Company
process to measure its own performance and
the performance of its Committees.
On an annual basis, the Chairman facilitates
Recommendation 2.2: Skills, Knowledge and
Experience
Directors are appointed based on the specific
a discussion and evaluation of the Board’s
business, industry and governance skills and
holds a relevant interest in 5,409,874
shares in the Company, representing
7.21% of the Company’s issued shares and
is thereby a substantial holder.
performance in accordance with this process.
experience as required by the Company. The
• Mr David Stewart, a Non-Executive
This includes discussions about the Board’s
Board recognises the need for Directors
Director, is not regarded as being
role, processes, performance and other
to have a relevant and applicable range of
independent, as two companies
relevant issues. Each Director’s performance
skills and personal experience in a range
associated with and/ or controlled by Mr
is reviewed by the Chairman and Board prior
of disciplines as required for the proper
Stewart in total hold a relevant interest
to the Director standing for re-election.
management and oversight of the Company’s
in 10,905,000 shares in the Company,
Performance evaluations will take place during
operations, as having regard to the scale and
representing 14.53% of the issued capital
September at the same time as those for all
nature of its activities.
of the Company and Mr Stewart is thereby
staff members. A performance evaluation was
The Board skills matrix set out below describes
a substantial holder.
22 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
CORPORATE GOVERNANCE STATEMENT
The names, qualifications and experience of
the environment and ensure a safe, equal and
Company to inform the Board of any behaviour
each Director of the Company are detailed in
support workplace.
or situation which they believe breaches or
the Directors’ Report in the Annual Report.
potentially breaches the Policy.
The values were developed collaboratively
Recommendation 2.5: Independent Chairman
by management and endorsed by the Board.
The Corporate Ethics Policy is also available at
Management is responsible for instilling these
the website.
The Chairman, Mr Simon Wallace, is the
values across the Company.
only independent Non-Executive Director
The Company’s objective is to maintain and
of the Company at this time. Mr Wallace was
Recommendation 3.2: Code of Conduct
further develop its business to increase
appointed as Chairman of the Company on
shareholder value while also adding value for
22 December 2016, based on his extensive
As part of the Board’s commitment to the
customers, employees and other stakeholders.
experience in legal and commercial matters,
highest standard of personal and corporate
To ensure this occurs, the Group conducts its
project finance and fundraising background and
behaviour, the Company adopts a Code of
business within the ethical responsibilities
his experience as a Director including of
Conduct to guide executives, management
documented and outlined in the Company’s
an ASX-listed entity.
and employees in carrying out their duties and
Code of Conduct and Corporate Ethics Policy.
The Chief Executive Officer of the Company is
such matters as:
4. Safeguard Integrity in Corporate Reporting
responsibilities. The code of conduct covers
Mr Michael Capocchi.
Recommendation 2.6: Induction of New
Directors and Regular Review for Existing
Directors
The Company has a program for inducting new
Directors. This includes giving new Directors
a full briefing about the nature of the business,
current issues, the corporate strategy and
the expectations of the Board concerning the
performance of the Directors and access to
• responsibilities to shareholders;
• compliance with laws and regulations;
• relations with customers and suppliers;
• ethical responsibilities including
responsibility for reporting and
investigating unethical practices;
• employment practices including a fair and
open approach to all forms of diversity;
and
• responsibilities to the environment and
the community.
Recommendation 4.1: Audit Committee
The Board has established an Audit Committee
to consider certain issues and functions in
further detail. The chairman of the Audit
Committee reports to the Board on any
matters of substance at the next full board
meeting. The Audit Committee has its own
terms of reference, approved by the Board and
reviewed annually, with additional review when
appropriate.
all employees to gain full background to the
The Code of Conduct is available at the
Company’s operations. The Company does not
Company’s website.
have a formal program to periodically review
The members of the Committee at the date
of this report are Mr David Stewart and Mr
whether there is a need for existing directors
Recommendation 3.3: Whistleblower policy
Simon Wallace. David Stewart is the current
to undertake professional development to
Chairman of the Audit Committee. Details of
maintain their skills and knowledge. However,
The Board has established and adopted a
the qualifications, experience and attendance
existing Directors are generally encouraged
Whistleblower Policy. The Whistleblower
at Committee meetings by each Committee
to attend director training and professional
Policy will be reviewed regularly by the Board.
Member is included in the Directors’ Report in
development courses, as may be required to
The Policy sets out the steps and process
the Annual Report.
enable them to develop and maintain the skills
to ensure that the Board is informed of any
and knowledge needed to effectively perform
material breaches of the Whistleblower Policy.
The ASX Corporate Governance Council has
their roles as Directors, at the Company’s
made recommendations for the composition of
expense (as approved by the Chairman and or
A copy of the Company’s Whistleblower Policy
the Audit Committee:
the Board, as appropriate and applicable).
is available on the Company’s website.
3. Act Lawfully, Ethically and Responsibly
Recommendation 3.4: Corporate Ethics and
Recommendation 3.1: Articulate and disclose its
cultures
Anti-Bribery and Corruption Policy
In addition to the Code of Conduct, the
Company has established a specific Corporate
BCC values are behaviours that guide the
Ethics Policy setting out the Company’s
actions and decision-making of staff, and reflect
behavioural expectations of its employees
the Company’s brand and culture. The values
when conducting business in Australia and
• the Committee should consist only of Non-
Executive Directors;
• it should have a majority of Independent
Directors;
• it should be chaired by an Independent
Director who is not Chairman of the
Board;
• the Committee should have at least 3
members.
are conducting its business activities openly,
internationally and specifically aims to
While recognising these recommendations,
with honesty, integrity and responsibility and
maintain the good standing and reputation
the Board is restricted by having currently
maintaining a strong sense of corporate social
of the Company along with highlighting the
only three Board positions. The Board’s small
responsibility. In maintaining its corporate
importance of anti-bribery and anti-corruption
size is a function of the relatively small scale of
social responsibility, BCC will conduct its
practices to its employees and directors. The
the Company’s operations. The Company may
business ethically and accordingly its values,
Corporate Ethics Policy also sets out the
assess the composition of the Board from time
encourage community initiatives, consider
process for employees and officers of the
to time, with a view to considering compliance
Ann ua l Repo rt 2021 23
CORPORATE GOVERNANCE STATEMENT
with the recommendation that the Audit
in connection with the performance of their
Committee have a majority of Independent
respective roles, including the adequacy of
Directors.
internal controls.
• half yearly reporting on the levels of audit
and non-audit fees; and
• specific exclusion of the audit firm from
work which may give rise to a conflict.
The one Independent Director on the Board
The Company’s Audit Committee met 3 times
is a member of the Audit Committee. Mr
during the course of the financial year ended 30
Recommendation 4.3: Verification process for
David Stewart, although not an Independent
June 2021.
Director was appointed Chairman of the Audit
periodic corporate report
Committee due to his financial and commercial
The Company’s Audit Committee has a formal
Before the financial statements for the half-
experience.
charter setting out the Committee’s role and
year and full-year are approved, the Board
responsibilities. The charter is posted on the
receives a statement from the CEO and CFO
Audit Committee assists the Board to discharge
Company’s website.
its corporate governance responsibilities, in
consistent with the requirements of the
Corporations Act 2001 (Cth). The Company
regard to the business’ relationship with, and
Recommendation 4.2: Approval of Financial
has also appointed RSM Australia Partners as
the independence of, the external auditors. It
Statements
especially:
its external auditor, who reviews the above
statements and provides an opinion on whether
• recommends appointment of external
auditors and fees;
• ensures reliability and integrity of
disclosure in the financial statements and
The Board receives regular reports about the
the Company’s financial report gives a true and
financial condition and operational results of
fair view of the Company’s financial position
the Company and its controlled entities. The
and financial performance, and whether it
CEO and CFO periodically provide formal
complies with Australian Accounting Standards
external related financial communications,
statements to the Board that, in all material
and the Corporations Regulations 2001.
although ultimate responsibility rests with
aspects, the Company’s financial statements
the full Board;
• reviews compliance with statutory
responsibilities;
• reviews budgets and accounting policy;
• ensures maintenance of an effective
framework of business risk management
present a true and fair view of the Company’s
The Company’s external Auditor attends the
financial condition and operational results.
Company’s AGMs and is available to answer
The CEO and the CFO each provide
audit and the preparation and content of the
shareholder questions about the conduct of the
declarations to the Board in accordance with
Auditor’s Report.
Section 295A of the Corporations Act 2001
including compliance and internal controls
confirming that in their opinion, with regard to
As to periodic corporate reports which are
and monitoring of the internal audit
risk management and internal compliance and
not subject to audit or review by an external
function;
• reviews adequacy of the Company’s
insurance program, including directors’
control systems:
• the statements made with respect to the
integrity of financial statements and notes
auditor, the Company has not established
a Disclosure Committee. However, due to
the small size of the Board, all Directors and
and officers’ professional indemnity and
thereto are founded on a sound system
Company Secretary are required to comment
other liability insurance cover;
• promotes and ensures an ethical financial
culture is embedded throughout the
Company; and
• undertakes any special investigations
required by the Board.
of risk management and internal control
on and approve an announcement before it is
systems which, in all material respects,
published.
implement the policies adopted by the
Board of Directors; and
• the risk management and internal control
systems are operating effectively and
5. Make Timely and Balanced Disclosure
Recommendation 5.1: Continuous Disclosure
The Audit Committee provides a forum for the
relation to financial reporting risks.
efficiently in all material respects in
Policy
effective communication between the Board
and external auditors. The Committee reviews:
• the annual and half-year financial report
prior to their approval by the Board;
• the effectiveness of management
information systems and systems of
internal control; and
• the efficiency and effectiveness of external
audit functions, including reviewing the
Auditor independence
The Board and senior management are aware
of the continuous disclosure requirements
of the ASX and have written policies and
Best practice in financial and audit governance
procedures in place, including a Continuous
is rapidly evolving and the independence of the
Disclosure Policy.
external auditor is particularly important to
shareholders and the Board. The Company’s
The guiding principle of this policy is that
practices in this area are reviewed regularly
the Company must immediately notify the
by the Board to ensure they are in line with
market via an announcement to the ASX of
respective audit plans.
emerging practices both domestically and
any information concerning the Company that
internationally. The Company’s current
a reasonable person would expect to have a
The Committee invites the CEO, the CFO, the
approach in relation to independence of its
‘material’ effect on the price or value of the
Company’s remaining Director and the external
auditor encompasses the following:
Company’s securities.
auditors to attend Committee meetings where
appropriate. The Committee also meets with
and receives regular reports from the external
auditors concerning any matters which arise
• rotation of the senior audit partner every
five years;
• annual confirmation by the auditor that it
has satisfied all professional regulations
relating to auditor independence;
The Board must ensure that Company
announcements:
• are made in a timely manner;
24 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
CORPORATE GOVERNANCE STATEMENT
• are factual;
• do not omit material information; and
• are expressed in a clear and objective
manner that allows investors to assess the
impact of the information when making
6. Respect the Rights of Security Holders
Recommendation 6.1: Communication to
Shareholders and Investors
investment decisions.
The Company is committed to increasing the
Where that information, however, is incomplete
and to be regarded by our shareholders as an
or confidential, or its disclosure is illegal, no
outstanding corporate citizen. Our approach
transparency and quality of its communication
• Election of Directors Policy;
• Disclosure Policy;
• Shareholder Communication Policy;
• Health and Safety Policy;
• Environmental and Community Relations
Policy;
• Corporate Ethics Policy; and
• Related Parties and Conflicts Policy.
disclosure is required. The Directors and senior
to communication with shareholders and
Recommendation 6.2: Investor Relations
management of the Company ensure that the
financial markets is set out in the Company’s
Program
Company Secretary is aware of all information
Shareholder Communication Policy document.
to be presented at briefings with analysts,
Two-way communication between the
stockbrokers, shareholders, the media and the
Information is communicated to shareholders
Company and its shareholders is facilitated
public. Prior to being presented, information
through the distribution of the Company’s
primarily via the Company’s AGM. The Board
that has not already been the subject of
Annual Report and other communications.
encourages shareholder participation at
disclosure to the market and is not generally
All significant information is posted on the
the AGM and other general meetings of the
available to the market is the subject of
Company’s website as soon as it is disclosed
shareholders. The Chairman encourages
disclosure to the ASX. Only when confirmation
to the ASX. All investors will have equal and
questions and comments from shareholders
of receipt of the disclosure and release to
timely access to information on the Company’s
and seeks to ensure that shareholders are given
the market by the ASX is received may the
financial position, performance, ownership and
ample opportunity to participate. Shareholders
information be presented.
governance. Shareholders who wish to send
who are unable to attend the AGM or a general
If the Company becomes aware of market-
electronically should contact the Company
before the meeting to the Company and/or to
sensitive information which ought to be
Secretary, Mr Dennis Payne.
the Auditor (in the case of the AGM).
and receive communications with the Company
meeting may submit questions and comments
disclosed, but the Company is not in a position
to issue an announcement promptly and
The Company ensures that shareholders are
without delay, the Company may request
informed of all major developments affecting
that the ASX grant a trading halt or suspend
the Group promptly through the issue of ASX
Recommendation 6.3: Shareholders’
Participation at General Meetings
the Company’s securities from quotation.
announcements and commentary on operations
All shareholders are encouraged to attend
Management of the Company may consult
in quarterly reports. All ASX announcements
and participate in shareholder meetings. All
external professional advisers and the ASX in
and quarterly reports are posted on the ASX
Directors, senior managers, Auditors and the
relation to whether a trading halt or suspension
website for the Company and on the Company’s
Company Secretary attend these meetings
is required.
website.
and respond to shareholder questions in
relation to specific agenda items and general
The Company’s Continuous Disclosure Policy is
All shareholders receive copies of shareholders
business. In light of the Covid-19 pandemic
available on the Company’s website.
notices by email or post and a copy of the
and restrictions on in-person gatherings and
annual report is distributed to all shareholders
travel which may be in place at the time of the
Recommendation 5.2: Board’s visibility of
who elect to receive one (hardcopy in the
Company’s 2021 Annual General Meeting, the
information disclosed
mail or electronically). The Company’s most
Company will consider available methods of
recent annual report is also available on the
facilitating virtual attendance by shareholders
Material market announcements are approved
Company’s website.
at the Annual General Meeting. Further details
by the Board at regular board meetings
scheduled to coincide with ASX filing timetable
Website Information
requirements. Other material market
announcements are always circulated to the
Board via e-mail.
regarding the nature of the Annual General
Meeting and how shareholders may ask
questions about agenda items will be contained
The Company has established a website at
www.beamcommunications.com, where
shareholders can access information about the
in the notice of meeting. The Annual General
Meeting features an address by the Chairman
and an extensive presentation by the CEO
Recommendation 5.3: Release of investor or
Company’s corporate governance policies and
which is also released as an ASX announcement
analyst presentations
practices. Information lodged on this website
for shareholders who cannot attend the
in a specific corporate governance section
meeting.
Presentations and transcripts of the Managing
includes:
Director’s address at annual general
meetings will be released on the ASX Market
Announcements Platform before the start
of the meetings. Other presentations to
new or substantive shareholders or investor
analysts are released on the ASX Market
Announcements Platform prior to the relevant
presentation.
• Board Charter;
• Audit Committee Charter;
• Risk Management Policy;
• Remuneration Policy;
• Securities Trading Policy;
• CEO and CFO Declarations;
• Whistle Blower Policy;
• Code of Conduct;
A description of the arrangements the
Company has to promote communications with
shareholders is detailed in the Shareholder
Communication Policy, available at the
Company’s website.
Ann ua l Repo rt 2021 25
CORPORATE GOVERNANCE STATEMENT
Recommendation 6.4: Substantive Resolutions
Recommendation 7.2: Risk Management
Recommendation 7.3: Internal Audit Function
decided by Polls
Framework
The Audit Committee assists the Board in
The Company is committed to the principle
The Company has implemented a risk
fulfilling its responsibilities in this regard by
of “one share one vote” and substantive
management program that enables the
reviewing the financial and reporting aspects
resolutions at shareholder meetings are
business to identify and assess risks, respond
of the Group’s risk management and control
decided by a poll instead of by a show of hands
appropriately and monitor risks and controls.
framework.
which does not take into account the number of
shares held.
The Company is exposed to risk from
The Audit Committee meets regularly to
operations (employee health and safety,
ensure, amongst other things, that the risk
Recommendation 6.5: Electronic Communication
environmental, insurance, litigation, disaster,
management internal control structures
business continuity), compliance issues and
and compliance with laws and regulations
Shareholders may elect to send communication
financial risks (interest rate, foreign currency,
are operating effectively. Details of the
to and receive communications from the
credit and liquidity). To mitigate these risks, the
Audit Committee are also set out in the Risk
Company and its Share Registry electronically.
Company has established risk and assurance
Management Policy, available at the Company’s
The contact email address for the Company
is info@beamcommunications.com and
shareholders may submit electronic queries to
the Company’s Share Registry via its website
www.linkmarketservices.com.au.
7. Recognise and Manage Risk
policies and procedures, which aim to:
website.
• assist management to discharge its
corporate and legal responsibilities; and
• assure management and the Board that
the framework is effective.
Recommendation 7.4: Exposure to
Environmental or Social Risks
The Company recognises, in particular, the
environmental and social risks to which it
Responsibility for control and risk management
may be exposed. The Company considers
Recommendation 7.1: Risk Committee
is delegated to the appropriate levels of
environmental risk to be the ability to continue
management within the Company and the CEO
its undertakings without compromising the
Due to the size of the Company and the nature
has ultimate responsibility to the Board for risk
health of the ecosystems in which it operates.
of the Company’s operations, a formal Risk
management and control. Areas of significant
The Company views social sustainability as the
Committee has not been established. The
business risk to the Company are detailed in
ability to continue operations in a manner that
Board is responsible for ensuring appropriate
the Business Plan presented to the Board by
is acceptable to social norms.
measures are in place in order to manage risk
the CEO at the start of each financial year. The
in line with the Company’s risk strategy. An
Board reviews and approves the parameters
The Board does not consider that the Company
external consultant has assisted the Board in
under which significant business risks will be
currently has any material exposure to
this process.
managed before adopting the Business Plan.
environmental or social sustainability risk.
Risk parameters and compliance information
Since the beginning of the ongoing Covid-19
The Board has required management to
are reported monthly to the Board by the CEO
pandemic, the Board has continued to
implement internal control systems to manage
and CFO.
the Company’s material business risks and to
monitor the impact of the pandemic on the
Company’s operations, compliance obligations
report on whether risks are being effectively
The Board has adopted reporting procedures
and finances, and risks to the Company
managed.
which allow it to:
resulting from the pandemic associated with
Arrangements put in place by the Board to
monitor risk include:
• review of risk areas at monthly Board
meetings;
• regular monthly reporting to the Board
in respect of operations, the financial
• monitor the Company’s compliance with
the continuous disclosure requirements of
macroeconomic factors. The Company has
provided and intends to continue to provide
the ASX; and
• assess the effectiveness of its risk
management and control framework.
updates to the market on the impact of
Covid-19 on the Company periodically.
The Company reviews its risk management
Covid-19 and other social and environmental
The Board intends to manage risks related to
position of the Company and new
framework on at least an annual basis. The
risks in accordance with the Company’s Risk
contracts;
• reports by the Chairman of the Audit
Committee;
• attendance and reports by the Managing
Director, CFO and the Company’s
management team at Board Meetings; and
• any Director may request that operational
and project audits be undertaken either
internally or be external consultants.
review examines the processes and procedures
Management Policy, if such risks should be
that the Company must initiate to control and/
identified in the future.
or mitigate these risks from impacting upon
the performance of the Company. The key risk
8. Remunerate Fairly and Responsibly
categories to which the Company is exposed,
and how it manages or intends to manage those
Recommendation 8.1: Remuneration Committee
risks, are set out in the Risk Management Policy
on the Company’s website.
The Board considers that, due to its small
size, and the current level of the Company’s
The abovementioned review took place in
operations, all members of the Board should
the 2020-2021 financial year with input from
be involved in determining remuneration
external consultants.
levels. Accordingly it has not established a
separate remuneration committee. Instead
time is set aside at two Board meetings each
26 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
CORPORATE GOVERNANCE STATEMENT
year specifically to address the matters usually
Fixed Salary
considered by a remuneration committee.
Recommendation 8.3: Equity Based
Remuneration
Executive Directors absent themselves during
The salary of Executive Directors and senior
discussion of their remuneration.
executives is determined from a review of
the market and reflects core performance
Long-Term Incentives
The Company has a share option scheme in
At these two meetings the Board reviews the
requirements and expectations. In addition, the
which senior executives may be invited to
following:
Company considers the following:
participate. The Share Option Incentive Plan
• the Company’s remuneration, recruitment,
retention and termination policies and
procedures for senior executives;
• senior executive remuneration and
incentives;
• superannuation arrangements;
• remuneration framework for Directors;
and
• whether there is any gender or other
inappropriate bias in remuneration for
directors, senior executives or other
• the scope of the individual’s role;
• the individual’s level of skill and
experience;
• the Company’s legal and industrial
obligations;
• labour market conditions; and
• the size and complexity of the Company’s
business.
Performance Bonus
was approved by shareholders on 27 October
2017 and authorises the Directors to issue
options up to 10% of the shares issued by the
Company. The number of shares and options
issued under the scheme is reasonable in
relation to the existing capitalisation of the
Company and all payments under the scheme
are made in accordance with thresholds set
in plans approved by shareholders. Any issue
of options to Executive and Non-Executive
Directors must be approved by Shareholders.
employees.
The purpose of the performance bonus is to
reward actual achievement by the individual
The Company has a Securities Trading Policy
Recommendation 8.2: Remuneration of
of performance objectives and for materially
which aims to:
Executive and Non-Executive Directors
improved Company performance.
Consequently, performance-based
• protect stakeholders’ interests at all times;
• ensure that directors and employees do
The remuneration structure of Non-Executive
remuneration is paid where a clear contribution
not use any information they possess
Directors and executives is disclosed in the
to successful outcomes for the Company is
for their personal advantage or the
Remuneration Report within the Directors’
demonstrated and the individual attains and
Company’s detriment; and
Report in the Annual Report. The remuneration
excels against pre-agreed key performance
• ensure that Directors and employees
of Non-Executive Directors is determined by
indicators during a performance cycle.
comply with insider trading legislation
the Board having regard to the level of fees paid
to Non-Executive Directors by other companies
Other Benefits
of similar size and stature.
of the various jurisdictions in which
transactions may take place.
The aggregate amount payable to the
superannuation and may also receive other
and/or options over such shares by Directors,
Company’s Non-Executive Directors must not
bonus payments subject to the discretion of the
executives and staff of the Company should
Senior executives are entitled to statutory
Purchase or sale of the Company’s shares
exceed the maximum annual amount approved
Board.
by the Company’s shareholders, currently
$500,000 as determined at the General
Long-Term Incentives
Meeting held on 3 August 2007.
only occur in circumstances where the market
is considered to be fully informed of the
Company’s activities. This policy requires
that the relevant person notify the Company
The Company is committed to remunerating
which is discussed further below which is
Company’s shares and/or options over such
its Executive Directors and senior executives
designed to provide long-term incentives to
shares prior to the transaction and that the
The Company has a share options scheme
Secretary of their intention to trade in the
in a manner that motivates them to pursue
senior executives.
the long-term growth and success of the
Company and is consistent with best practice.
Termination Payments
The Company aims to align the interests of
Company Secretary be required to discuss the
proposed trading intentions with the Chairman.
The Board recognises that it is the individual
responsibility of each Director to comply with
Executive Directors and senior executives with
Senior executives may be entitled to a payment
this policy. Breaches of this policy may lead
those of shareholders through short-term and
upon termination of employment from the
to disciplinary action being taken, including
long-term incentive plans which demonstrate
Company. Where so entitled, the termination
dismissal in serious cases. The Company’s
a clear relationship between performance and
payment has been agreed in the senior
Securities Trading Policy is available on the
remuneration.
executive’s contract of employment and it is not
Company’s website.
Consequently, Executive Directors and senior
for misconduct.
payable where termination of employment is
executives’ remuneration consists of the
following elements:
• fixed salary;
• short-term incentive bonus based on
performance;
• long-term incentive share/option scheme;
and
• other benefits including superannuation
The Corporations Act prohibits the key
management personnel of an ASX listed
Further details in relation to the Company’s
company established in Australia, or a closely
remuneration policies are contained in the
related party of such personnel, from entering
Remuneration Report within the Directors’
into an arrangement that would have the effect
Report in the Annual Report. The Company’s
of limiting their exposure to risk relating to an
Remuneration Policy is available on the
element of their remuneration that either has
Company’s website.
not vested or has vested but remains subject to
a holding lock.
Ann ua l Repo rt 2021 27
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2021
Revenue
Other income
Year ended
30 June 2021
$
30 June 2020
$
18,497,060
14,923,300
1,028,018
1,917,865
Note
2(a)
2(b)
Changes in inventories of raw materials, finished goods and work in progress
(504,109)
839,059
Raw materials, consumables and other costs of sale
2(c)
(12,276,211)
(9,192,850)
Employee benefits expense
Depreciation expense
Amortisation expense
Impairment expense
Finance costs expense
Auditor remuneration expense
Accounting, share registry and secretarial expense
Consultancy and contractor expense
Legal, insurance and patent expense
Marketing and ICT expense
Share of loss from interest in Joint Venture
Other expenses
Profit (loss) before income tax
Tax expense
Profit (loss) for the year
Other comprehensive income
Total comprehensive income (loss) for the year
Net Profit (loss) and total comprehensive loss are both fully attributable to owners of the Company
(2,818,700)
(2,665,464)
8(a), 9
(199,926)
(211,015)
11(a)
11(a)
2(d)
22
7
2(e)
(810,451)
(1,520,080)
-
(2,791,218)
(200,057)
(271,516)
(69,400)
(75,800)
(97,013)
(103,423)
(403,943)
(486,783)
(203,970)
(182,413)
(605,555)
(405,785)
(137,080)
(389,617)
(418,217)
(901,782)
780,446
(1,517,523)
3(a)
(271,268)
(111,711)
509,178
(1,629,234)
-
-
509,178
(1,629,234)
Earnings per share (cents)
Diluted earnings per share (cents)
24
24
0.76
0.76
(0.31)
(0.31)
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction
with the accompanying notes.
28 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2021
AS AT 30 JUNE 2021
Year ended
Note
30 June 2021
$
30 June 2020
$
4
5
6
7
8
9
10
11
12
13
14
15
13
14
15
3,707,484
873,906
3,071,973
3,576,082
3,156,473
2,337,993
9,935,930
6,788,035
232,560
404,918
71,530
93,811
360,308
519,068
596,169
1,015,413
5,500,055
3,803,161
6,760,622
5,836,371
16,696,552
12,624,406
2,633,268
2,785,037
-
207,437
971,392
182,930
1,101,924
1,294,111
3,942,629
5,233,471
735,112
309,129
48,112
818,737
514,606
47,120
1,092,353
1,380,463
5,034,982
6,613,934
11,661,570
6,010,472
16
12,703,060
7,646,641
85,500
320,394
(1,126,990)
(1,956,563)
11,661,570
6,010,472
Current assets
Cash and cash equivalents
Inventories
Trade and other receivables
Total current assets
Non-current assets
Interest in joint venture
Plant and equipment
Right-of-use assets
Deferred tax assets
Intangible assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Other financial liabilities
Lease liabilties
Provisions
Total current liabilities
Non-current liabilities
Other financial liabilities
Lease liabilties
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
Ann ua l Repo rt 2021 29
Balance at 30 June 2020
7,646,641
320,394
(1,956,563)
6,010,472
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2021
Balance at 1 July 2019
Loss for the year
Other comprehensive income for the year, net of income tax
- Adjustment for employee share option lapsed
Balance at 1 July 2020
Profit for the year
Other comprehensive income for the year, net of income tax
Transactions with owners in their capacity as owners:
Issued
capital
$
Reserves
$
Retained
earnings
$
Total
equity
$
7,646,641
411,189
(418,125)
7,639,705
(1,629,234)
(1,629,234)
(90,795)
90,795
-
-
7,646,641
320,394
(1,956,563)
6,010,472
509,178
509,178
-
-
-
-
-
-
-
-
-
-
4,964,957
-
-
-
-
-
-
-
- Shares issued, net of transaction costs
4,964,957
- Adjustment for broker options issued
(85,500)
85,500
- Adjustment for employee share options lapsed
-
(320,394)
320,394
- Adjustment for employee share options exercised
176,963
-
-
176,963
Balance at 30 June 2021
12,703,060
85,500
(1,126,990)
11,661,570
The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.
30 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D
Cash flow from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Interest and finance charges paid
Income tax credit (expense)
COVID-19 relief
CONSOLIDATED STATEMENT OF CASH FLOWS
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2021
FOR THE YEAR ENDED 30 JUNE 2021
Year ended
30 June 2021
$
30 June 2020
$
Note
19,191,491
15,393,052
(18,496,129)
(13,614,662)
561
717
(158,066)
(220,743)
28,645
(233,977)
366,500
230,000
Net cash provided by operating activities
19(a)
933,002
1,554,387
Cash flow from investing activities
Purchases of plant and equipment
Development costs capitalised
Research and development grant
Interest in joint venture
Net cash used in investing activities
Cash flow from financing activities
Net loan payments
Lease liability repayments
Net cash proceeds on share placement
Net cash provided by financing activities
8(a)
12
(22,037)
(56,595)
(2,507,345)
(2,534,199)
689,703
-
-
(689,997)
(1,839,679)
(3,280,791)
(1,046,593)
220,978
(178,164)
(152,900)
4,964,957
-
3,740,200
68,078
Net increase (decrease) in cash and cash equivalents
2,833,524
(1,658,326)
Cash and cash equivalents at beginning of year
873,960
2,532,285
Cash and cash equivalents at end of financial year
19(b)
3,707,484
873,960
The above Statement of Cash Flows should be read in conjunction with the accompanying notes.
Ann ua l Repo rt 2021 31
1. Summary of significant accounting policies
(i) 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 and comply
with International Financial Reporting Standards as issued by the International Accounting Standards Board. The Group is a
for-profit entity for financial reporting purposes under Australian Accounting Standards. Material accounting policies adopted in
the preparation of these financial statements are presented below and have been consistently applied unless stated
otherwise.
Reporting Basis and Conventions
Except for cash flow information, the financial statements have been prepared on an accruals basis and are based on
historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets
and financial liabilities.
(ii) New or amended Accounting Standards and Interpretations adopted
The Group has adopted all of the new or amended Accounting Standards and Interpretations issued by AASB that are
mandatory for the current reporting period.
New and revised Standards and amendments and Interpretations effective for the current year that are relevant to the Group
are:
- AASB 2018-6 Amendments to AASs Definition of a Business
- AASB 2018-7 Amendments to AASs Definition of Material
- AASB 2019-1 Reference to conceptual framework
- AASB 2019-3 Amendments to AASs Interest Rate Benchmark Reform Business
- AASB 2019-5 Amendments to AASs Disclosure of the Effect of New IFRS Standards Not Yet Issued in Australia Business
- AASB 2020-4 Amendments to Australia Accounting Standards - COVID-19 Related Rent Concessions
Conceptual Framework for Financial Reporting (Conceptual Framework)
The consolidated entity has adopted the revised Conceptual Framework from 1 July 2020. The Conceptual Framework
contains new definition and recognition criteria as well as new guidance on measurement that affects several Accounting
Standards, but it has not had a material impact on the consolidated entity’s financial statements.
The adoption of other new or amended Accounting Standards or Interpretations has not had any material impact on the
disclosures or on the amounts reported in the financial statements.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
(iii) Accounting policies
The following is a summary of the material accounting policies adopted by the consolidated group in the preparation of the
financial report. The accounting policies have been consistently applied to all years presented, unless otherwise stated. When
required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the
current financial year.
(a) Principles of consolidation
The consolidated financial statements incorporate all of the assets, liabilities and results of the parent (Beam
Communications Holdings Limited) and all of the subsidiaries which are entities the parent controls. A list of the
subsidiaries is provided in Note 27.
(b) Income tax
Income tax expense (benefit) for the year comprises current income tax expense (credit) and deferred income tax
expense (benefit).
A net deferred tax expense has been recognised in the current year reflecting the movements in deferred tax assets and
liabilities for the period.
32 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 1. Summary of significant accounting policies (continued)
(iii) Accounting policies (continued)
(b) Income tax (continued)
Deferred tax is accounted for using the liability method in respect of temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised
from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on
accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or liability is
settled. Deferred tax is credited in the statement of profit or loss and other comprehensive income except where it relates
to items that may be credited directly to equity, in which case the deferred tax is adjusted directly against equity.
Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available against
which deductible temporary differences can be utilised. At each reporting date, the consolidated group re-assesses unrecognised
deferred tax assets as to the extent that it has become probable that future tax profit will enable recognition.
Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net
settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets
and liabilities are offset where: (a) a legally enforceable right of set-off exists; and (b) the deferred tax assets and
liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different
taxable entities where it is intended that net settlement or simultaneous realisation and settlement of the respective asset
and liability will occur in future periods in which significant amounts of deferred tax assets or liabilities are expected to be
recovered or settled.
Beam Communications Holdings Limited and its wholly owned Australian subsidiaries have formed a tax consolidated
group under the tax consolidation regime. Each entity in the group recognises its own tax expense and deferred tax. The
current tax liability of each group entity and deferred tax assets arising from tax losses are immediately assumed by the
parent entity.
(c) Plant & equipment
Plant and equipment is carried at cost less any accumulated depreciation and impairment losses, where applicable.
The carrying amount of plant and equipment is reviewed at each reporting date by directors to ensure it is not in excess
of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash
flows that will be received from the assets employment and subsequent disposal. The expected net cash flows have
been discounted to their present values in determining recoverable amounts.
Repairs and maintenance to plant and equipment is charged to the statement of profit or loss and other comprehensive
income during the financial period in which it is incurred.
The depreciable amount of plant and equipment is depreciated on a straight line basis over their useful lives to the
consolidated group commencing from the time the asset is held ready for use.
The straight line depreciation rates for plant and equipment were:
Office furniture and equipment 10% - 20%
Computer and test equipment 33%
Rental equipment 20% - 33%
The asset’s residual values and useful lives are reviewed, and adjusted if appropriate, at each balance date. An asset’s
carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its
estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses
are included in the statement of profit or loss and other comprehensive income.
ANN UAL REP ORT 2021 33
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 1. Summary of significant accounting policies (continued)
(iii) Accounting policies (continued)
(d) Inventories
Inventories are measured at the lower of cost and net realisable value. The cost of manufactured products includes direct
materials and direct labour.
(e) Intangible assets – development costs
Development costs are capitalised only when it is probable that the expected future economic benefits would flow to the
company and can be measured reliably. Development costs have a finite life and are amortised on a systematic basis
matched to future production. Expenditure not related to the creation of a new product is recognised as an expense when
incurred.
The amortisation rate for capitalised development costs is dependent on an assessment of the minimum useful life of
each project. Recent projects/products have been assessed at 4 years giving a 25% amortisation rate during 2021.
(f) Employee benefits
Short-term employee benefits
Provision is made for the Group’s obligation for short-term employee benefits. Short-term employee benefits are benefits
(other than termination benefits) that are expected to be settled wholly before 12 months after the end of the annual
reporting period in which the employees render the related service, including wages, salaries and sick leave. Short-term
employee benefits are measured at the undiscounted amounts expected to be paid when the obligation is settled.
The Group’s obligations for short-term employee benefits such as wages, salaries and sick leave are recognised as a
part of current trade and other payables in the statement of financial position. The Group’s obligations for employees’
annual leave and long service leave entitlements are recognised as provisions in the statement of financial position.
Other long-term employee benefits
Provision is made for employees’ long service leave and annual leave entitlements not expected to be settled wholly
within 12 months after the end of the annual reporting period in which the employees render the related service. Other
long-term employee benefits are measured at the present value of the expected future payments to be made to
employees. Expected future payments incorporate anticipated future wage and salary levels, durations of service and
employee departures and are discounted at rates determined by reference to market yields at the end of the reporting
period on government bonds that have maturity dates that approximate the terms of the obligations. Any remeasurements
for changes in assumptions of obligations for other long-term employee benefits are recognised in profitor loss in the periods
in which the changes occur.
Option based compensation relates to the value of options issued to date and brought to account pro-rata to the time
period from the date of issue to the date of vesting, except in the case of Director’s where Accounting Standard AASB 2
requires expensing to begin from the commencement of service related to those options, notwithstanding that the issue
of those options is subject to shareholder approval.
The Group’s obligations for long-term employee benefits are presented as non-current provisions in its statement of
financial position, except where the Group does not have an unconditional right to defer settlement for at least 12 months
after the end of the reporting period, in which case the obligations are presented as current provisions.
(g) Financial instruments
Financial instruments in the form of trade receivables, trade payables and other financial assets and liabilities are initially
measured at fair value adjusted by transactions costs on trade date when the related contractual rights or obligations
arise. Realised and unrealised gains or losses arising from changes in the fair value of these assets or liabilities are
included in the statement of profit or loss and other comprehensive income in the period in which they arise. At each
reporting date, the group assesses whether there is objective evidence that a financial instrument has been impaired.
Impairment losses are recognised in the statement of profit or loss and other comprehensive income. Refer Note 17 for a
detailed review of the group’s financial instruments.
34 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 1. Summary of significant accounting policies (continued)
(iii) Accounting policies (continued)
(g) Financial instruments (continued)
The Group does not designate any interests in subsidiaries as being subject to the requirements of Financial Instruments
accounting standards.
(h) Impairment of assets
At each reporting date, the group reviews the carrying values of its assets to determine whether there is an indication that
those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of
the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the
assets carrying value over its recoverable amount is expensed to the statement of profit or loss and other comprehensive
income. Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
The group uses an Expected Credit Loss model in assessing impairment of trade and other receivables or loans and
other instruments that fall within the scope AASB 9 impairment requirements. The model includes a simplified approach
in accounting for trade and other receivables as well as contract assets, and records the loss allowance at the amount
equal to the expected lifetime credit losses. Under this simplified approach, the Group uses its historical experience,
external indicators and forward-looking information to calculate the expected credit losses.
(i) Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid
investments with original maturities of three months or less, and bank overdrafts. Where applicable, bank overdrafts are
disclosed within other financial liabilities in current liabilities on the statement of financial position.
(j) Leases
The Group assesses whether a contract is or contains a lease, at inception of the contract. The entity recognises a right of-use
asset and a corresponding lease liability with respect to all lease arrangements in which it is the lessee, except for
short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value assets. For these
leases, the Group recognises the lease payments as an operating expense on a straight-line basis over the term of the
lease unless another systematic basis is more representative of the time pattern in which economic benefits from the
leased assets are consumed.
When measuring lease liabilities for lease that were classified as operating leases, the Group discounted lease payments
using its incremental borrowing rate at 1 July 2019. The weighted average rate applied is 7.3% to 8%.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement
date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the entity uses its
incremental borrowing rate. The lease liability is subsequently measured by increasing the carrying amount to reflect
interest on the lease liability (using the effective interest method) and by reducing the carrying amount to reflect the lease
payments made.
The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or
before the commencement day, less any lease incentives received, any initial direct costs and an estimate of any costs
to dismantle and remove the asset at the end of the lease. They are subsequently measured at cost less accumulated
depreciation and impairment losses. Right-of-use assets are depreciated over the shorter period of lease term and useful
life of the underlying asset. They are subject to impairment or adjusted for remeasurement.
(k) Revenue recognition
Revenue from the sale of goods or services is brought to account upon fulfilment of the relevant performance obligations
of the contract with the customer. Performance obligations are fulfilled upon delivery of the goods or services to the
customer at which point the transaction price is brought to account as revenue. The transaction price is the amount of
consideration to which the group expects to be entitled in exchange for transferring promised goods or services to a
customer.
Interest revenue and rental income are recognised when they become receivable. Other revenue is recognised when the
right to receive the revenue has been established.
ANN UAL REP ORT 2021 35
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 1. Summary of significant accounting policies (continued)
(iii) Accounting policies (continued)
(l) Government grants
Government grants in the form of refundable Research and Development Tax Offsets received in respect of capitalised
Development Costs are initially recognised as deferred income upon receipt, and brought to account as income on a
systematic basis over the useful life of the related Development Cost assets.
Export market development grants are brought to account in the statement of profit or loss and other comprehensive
income in the period received.
There are no unfulfilled conditions or other contingencies attaching to government grants recognised in the financial
statements.
(m) Interest in joint venture
A joint venture represents the contractual sharing of control between parties in a business venture where unanimous
decisions about relevant activities are required.
Where the Group is a party to a joint venture, the Group recognises its interests in the joint venture using the equity
method whereby the investment in the joint venture is carried in the statement of financial position at cost plus post
acquisition changes in the Group’s share of net assets of the joint venture.
The statement of profit or loss and other comprehensive income reflects the Group’s share of the results of operations of
the joint venture. Unrealised gains and losses resulting from transactions between the Group and the joint venture are
eliminated to the extent of the interest in the joint venture.
(n) Foreign currency transactions and balances
Functional and presentation currency
The consolidated financial statements are presented in Australian dollars which is the parent entity’s functional and
presentation currency. The functional currency of each of the group’s entities is measured using the currency of the
primary economic environment in which that entity operates.
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of
the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items
measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary
items measured at fair value are reported at the exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in the statement of profit or loss and
other comprehensive income.
(o) Goods and Services Tax (GST)
Revenue, expenses and assets are recognised net of the amount of GST, except where the amount of GST is not
recoverable from the Australian Taxation Office. In these circumstances the GST is recognised as part of the asset or
expense cost. Receivables and Payables are shown in the statement of financial position as inclusive of GST.
Cash flows are presented in the statement of cash flows on a gross basis, except for the GST component of investing
and financing activities which are disclosed as operating cash flows.
36 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 1. Summary of significant accounting policies (continued)
(iii) Accounting policies (continued)
(p) Critical accounting estimates, judgments and assumptions
The preparation of the Group’s consolidated financial statement requires management to make judgements, estimates
and assumptions. Uncertainty about these assumptions and estimate could result in outcomes that require a material
adjustment to the carrying amount of assets or liabilities affected in future period.
Information about areas of estimation uncertainty and critical assumptions are described in the following notes:
• Note 3 Deferred tax asset – tax losses
• Note 11 Impairment of intangible assets
• Note 14 Lease liabilities – Estimating the incremental borrowing rate
• Note 21 Share-based payment – Determination of valuation model and assumptions about incentive plan
(q) New accounting standards for application in future periods
The below are Accounting Standards and Interpretations issued by the AASB that are not yet mandatorily applicable to
the Group, with an assessment of the potential impact of such pronouncements on the Group when adopted in future
periods:
Accounting Standards and Interpretations
AASB 2020-1 Amendments to AASs - Classification of Liabilities as Current or Noncurrent liabilities
as Current or Non-current
AASB 2020 -3 Amendments to AASs - Annual Improvements 2018-2020 and OtherAmendments
ASB 2020-6 Amendments to AASs - Classification of Liabilities as Current or Noncurrent liabilities
as Current or Non-current – Deferral of Effective Date
AASB 2021-2 Amendments to AASs - Disclosure of Accounting Policies and
Definition of Accounting Estimates
AASB 2021-5 Amendments to AASs - Deferred Tax related to Assets and Liabilities
arising from a Single Transaction
Applicable to annual
reporting periods
beginning on or after
1 July 2023
1 July 2022
1 July 2022
1 July 2023
1 July 2023
The Group is in the process of reviewing these amended standards and interpretations however it is not expected that this will have a significant impact on
the Group’s consolidated financial statements.
ANN UAL REP ORT 2021 37
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2021
2
Profit (loss) before income tax
(a) Disaggregation of revenue:
Type of goods or services
- Equipment sales
- Airtime
- Other
Geographical markets
- Australia
- United States of America
- United Arab Emirates
- United Kingdom
- China
- Canada
- Japan
- Other foreign countries
Timing of revenue recognition
- Goods and services transferred at a point in time
- Goods and services transferred over time
(b) Other income
- Research and Development grant (i)
- Interest
- COVID-19 relief (ii)
-Gain on reversal of joint venture loss accrual (iii)
- Other
(i) The Research and Development grant $363,258 includes $73,055 brought to account upon full amortisation
of the capitalised Thuraya WE terminal and $290,203 recognised as income over the portion of useful life of
the ZOLEO R&D project to 30 June 2021, in accordance with the accounting policy detailed in Note 1 (iii) (l).
See also Note 12.
(ii) The Group was eligible to receive a JobKeeper allowance of $309,000 and a Cash Flow Boost payment of
$37,500 from the Australian government and a VIC state government grant of $20,000. See also Note 28.
(iii) The $294,893 reversal was for the previous year’s accrual for joint venture losses reflecting the
improved sales forecast and cashflow of the joint venture business.
(c) Cost of sales
Opening inventories
Add: Purchases and other stock adjustments
Closing inventories (Note 5)
(d) Finance costs expense
Interest expense on financial liabilities
Interest expense on lease liabilities
(e) Other expenses include:
- Product development costs expensed
- Operating lease payments
Year ended
30 June 2021
$
30 June 2020
$
17,353,524
13,023,662
969,627
173,909
1,514,365
385,273
18,497,060
14,923,300
4,166,871
3,115,480
3,454,692
4,045,000
760,875
1,048,492
1,279,838
1,321,229
227,169
284,976
6,053,935
2,168,610
343,460
450,198
2,210,220
2,489,314
18,497,060
14,923,299
17,423,393
13,023,662
1,073,667
1,899,638
18,497,060
14,923,300
363,258
1,414,549
561
366,500
294,893
2,806
164,187
332,500
-
6,629
1,028,018
1,917,865
3,576,082
2,737,022
12,276,211
9,192,850
15,852,293
11,929,872
(3,071,973)
(3,576,082)
12,780,320
8,353,790
154,625
45,432
200,057
241,071
34,409
213,864
57,652
271,516
273,796
47,005
3
Income tax
(a) The components of tax expense comprise:
- US tax expense (credit) (d)
- Current movement of temporary difference in net deferred tax assets
- Movement in deferred tax asset associated with carry forward tax losses
- Deferred tax effect of initial application of AASB 16
Income tax expense transferred to statement of profit or loss and other comprehensive income
(b) Reconciliation of income tax expense and tax at statutory rate:
Year ended
30 June 2021
$
30 June 2020
$
(147,976)
310,941
108,303
-
271,268
233,977
(368,234)
216,565
29,403
111,711
Profit (loss) from ordinary activities
780,446
(1,517,523)
Income tax expense (benefit) at statutory rate of 25% (2020: 27.5%)
195,112
(417,319)
Add / (Less):
Tax effect of:
- Tax reconciling items
- US tax expense (credit) (d)
- Deferred tax assets (gain) / loss
- Deferred tax effect of initial application of AASB 16
Income tax expense attributable to the Consolidated Group
(195,112)
(147,976)
446,721
233,977
419,244
(122,266)
-
271,268
(29,403)
111,711
(c) The deferred tax expense reflects the movements in the deferred assets and liabilities. The directors have maintained a
conservative approach and have recognised 60% (2020: 60%) of the deferred tax assets and liabilities inclusive of carried
forward tax losses.
Although the Directors expect sufficient future profitability to enable the full value of all deferred tax assets to be utilized, the
decision has been taken not to increase the proportion taken up at this time, with continuing demonstration of the Group’s return
to profitability required before the Board would consider doing so.
The amount of unused net deferred tax assets relating to tax losses which have not been brought to account (being the 40%
portion) is $765,430 (2020: $837,632) and capital tax losses of $1,681,896 (2020: $1,850,085).
The amount of net deferred tax assets which may be realised in the future is dependent on the assumption that no adverse change
will occur in income taxation legislation and the anticipation that the Consolidated Group will derive sufficient future assessable
income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.
(d) Income tax expense includes a credit for overpayment $150,623 in previous years and a tax expense of $2,647. As both
amounts were incurred by the Group’s USA subsidiary, they are unable to be combined with Australian tax losses.
(e) There are no franking credits available to equity holders.
ANN UAL REP ORT 2021 39
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 4
Cash and cash equivalents
Cash at bank and on hand
5
Inventories
Raw materials
Finished goods
Less: Provision for stock obsolescence
6
Trade and other receivables
(a) Current
Trade receivables
Less: Provision for expected credit losses
Other receivables and prepayments
Rental & other security deposits
Year ended
30 June 2021
$
30 June 2020
$
3,707,484
873,960
364,113
795,681
2,987,860
3,025,401
(280,000)
(245,000)
3,071,973
3,576,082
1,793,387
1,342,615
-
-
1,249,621
881,854
113,465
113,523
3,156,473
2,337,993
(b) Ageing reconciliation
Gross amount
Within trade
Past due but not impaired (days overdue)
Past due &
terms
31 - 60 61 - 90 90+
impaired
2021
Current
Trade receivables
1,793,387
1,521,905
248,880
17,296
5,306
Other receivables
1,249,621
1,249,621
Rental and other security deposits
113,465
113,465
-
-
-
-
-
-
-
-
-
Expected credit loss rate
0%
0%
0%
0%
0%
0%
2020
Current
Trade receivables
1,342,615
1,135,181
202,932
66
4,436
Other receivables
881,854
881,854
Rental & other security deposits
113,523
113,523
-
-
-
-
-
-
-
-
-
Expected credit loss rate
0%
0%
0%
0%
0%
0%
All trade receivables past due terms but not impaired are expected to be received in the normal course of business.
40 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 7
Interest in joint venture
Investment in joint venture
Group’s accumulated share of loss from ZOLEO Inc joint venture
The Group has a 50% share in a joint venture company, ZOLEO Inc , which was incorporated in
Canada in August, 2018.
ZOLEO Inc had no contingent liabilities or capital commitments as at 30 June 2020.
The Group contributed U$475,000 to the joint venture during the year, which was recognised as an
increase in investment as per the equity accounting method.
Summarised financial information:
Summarised statement of financial position:
Current Assets
Total Assets
Current Liabilities
Non -current Liabilities
Total Liabilities
Net Asset Deficiency
Share Capital
Accumulated Losses
Net Equity
Summarised statement of profit or loss and other comprehensive income:
Revenue
Cost of goods sold
Expenses:
Operating staff costs
Marketing
Professional services
Billing & support services
Other expenses
Total expenses
Gain on FX
Loss for the year
Group’s share of loss for the year ended
Year ended
30 June 2021
$
30 June 2020
$
1,082,439
1,117,717
(849,879)
(712,799)
232,560
404,918
ZOLEO Inc
30 June 2021 30 June 2020
3,484,866
1,430,190
3,484,866
1,430,190
3,021,515
620,365
2,061,719
2,258,488
5,083,234
2,878,853
(1,598,368)
(1,448,663)
266
291
(1,598,634)
(1,448,954)
(1,598,368)
( 1,448,663)
13,477,482
2,174,203
(12,766,594)
2,196,968
(604,867)
(572,107)
(28,100)
(46,135)
(183,389)
(124,020)
(21,626)
(59,190)
(10,419)
(93,126)
(986,511)
(756,468)
1,463
-
(274,160)
(779,233)
(137,080)
(389,617)
ANN UAL REP ORT 2021 41
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 8
Plant and equipment
Office furniture and equipment - at cost
Less: Accumulated depreciation and impairment
Computer and test equipment - at cost
Less: Accumulated depreciation and impairment
Rental equipment - at cost
Less: Accumulated depreciation and impairment
Year ended
30 June 2021
$
30 June 2020
$
491,431
491,431
(462,463)
(448,980)
28,968
42,451
410,808
390,971
(378,864)
(356,412)
31,944
34,559
43,493
44,458
(32,875)
(27,657)
10,618
16,801
Total plant and equipment
71,530
93,811
Office Furniture &
Equipment
Computer & Test
Equipment
Rental
Equipment
Total
(a) Movements in carying amounts
Movements in the carrying amounts of each class
of plant and equipment between the beginning
and the end of the current financial year:
Balance at 1 July 2019
Additions
Disposals
53,398
9,839
-
38,922
20,861
10,637
102,957
25,895
56,595
-
(13,486)
(13,486)
Depreciation expense
(20,785)
(25,225)
(6,245)
(52,255)
Balance at 30 June 2020
42,451
34,559
16,801
93,811
Additions
Disposals
-
-
22,037
(2,200)
-
(952)
22,037
(3,152)
Depreciation expense
(13,483)
(22,452)
(5,231)
(41,166)
Balance at 30 June 2021
28,968
31,944
10,618
71,530
42 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 9
Right-of-use assets
Cost
Balance recognised at the beginning of the year
677,829
677,829
Year ended
30 June 2021
$
30 June 2020
$
Additions
Disposals
Balance at the end of year
Accumulated depreciation
Balance recognised at the beginning of the year
Charge for the year
Disposals
Balance at the end of year
Carrying amount
The Group leases several assets, which includes building, forklift and printers with original lease
terms of 9, 3 and 5 years respectively. The remaining lease terms at the end of the current reporting
period are all less than 3 years. There are no variable lease payment terms in any lease contracts.
There are no extension or termination options on the leases.
The Group received rental relief for the office buildings in light of COVID-19 in the previous
financial year and the current financial year. 15% of June 2020 rents were initially deferred for 24
months and another 15% waived, but the adjustment was reversed in financial year 2021.
The Group was granted a 15% rent deferral for 24 months and a further 15% rent reduction for
August 2021, and the deferred amount of $4,770 will be paid in July 2022.
Amount recognised in profit or loss
Depreciation expense on right-of-use assets
Interest expense on lease liabilities
Expense relating to short-term leases
Expense relating to leases of low value assets
-
-
-
-
677,829
677,829
(158,761)
-
(158,760)
(158,761)
-
-
(317,521)
(158,761)
360,308
519,068
158,760
158,761
45,432
57,652
11,892
23,758
-
-
ANN UAL REP ORT 2021 43
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 10
Tax
Non-current
Deferred tax assets
Deferred tax assets:
Carrying amount of patents and capital raising costs
Accruals
Provisions
Lease Liabilities
Tax losses
Deferred tax liability:
Product development costs
Right-of-use-assets
Other financial liabilities
11
Intangible assets
Development costs capitalised - at cost
Accumulated amortisation and impairment
(a) Movement in carrying amounts
Balance at the beginning of the year
Additional costs capitalised
Amortisation expense
Impairment expense
Balance at the end of the year
Balance at
July 1 2020
Charged to Income
Balance at
30 June 2021
144
91,806
265,090
115,093
1,256,447
1,728,580
(627,521)
(85,646)
-
1,015,413
(96)
(50,379)
(46,365)
(37,608)
(108,303)
(242,751)
(197,487)
31,600
(10,606)
(419,244)
48
41,427
218,725
77,485
1,148,144
1,485,829
(825,008)
(54,046)
(10,606)
596,169
Year ended
30 June 2021
$
30 June 2020
$
6,310,506
16,623,642
(810,451)
(12,820,481)
5,500,055
3,803,161
3,803,161
5,580,260
2,507,345
2,534,199
(810,451)
(1,520,080)
-
(2,791,218)
5,500,055
3,803,161
The Group has assessed the minimum useful life of products from recent development projects at 4
years giving a 25% amortisation rate on completed projects during 2021 financial year.
In line with the accounting policy detailed in Note 1 (iii) (h), the carrying value of assets is reviewed
to determine whether there is an indication that those assets have been impaired. None of the
intangible assets was written off during the financial year.
44 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 Year ended
30 June 2021
$
30 June 2020
$
1,795,657
2,258,898
583,753
253,858
257,307
268,832
2,633,268
2,785,037
-
971,392
735,112
-
735,112
758,703
60,034
818,737
12
Trade and other payables
Current
Trade payables and accruals
Deferred R&D income
Deferred income other
The Group initially recognises R&D grants as deferred income upon receipt and brings to account the
income over the same period as the amortisation of the related completed project cost. $363,258 of
R&D grant income was recognised in the statement of profit & loss for the year as shown in Note 2 (b).
13
Other financial liabilities
Current
Secured loan (a)
Non Current
Secured loan (b)
Unsecured loan (c)
Secured loans
(a) The Group previously had a secured loan finance facility with SGV1 Holdings Limited for
US$2,000,000, of which US$666,666 had been drawn down. The loan was fully repaid on 28
October 2020 and the facility has been terminated.
(b) The Group has a secured loan facility with Roadpost Inc. of up to US$600,000. Roadpost is a
Canadian company and a joint venture partner with Beam Communications Pty Ltd to develop,
market and distribute the ZOLEO product, a satellite based messaging device, including
associated airtime contracts. The interest-free Assistance Loan is to assist Beam to establish
the business and is repayable at Beam’s sole discretion. As at 30 June 2021, US$600,000 has
been drawn down. The total loan balance of A$735,112 represents the fair value of the loan at
30 June 2021. The loan is secured by Beam’s pledge of shares in ZOLEO Inc, an entity established
with Roadpost to manage the ZOLEO business.
Unsecured loans
(c) The Group had an unsecured loan facility with supplier DEK Technologies Pty. Ltd. for A$400,000
to fund the Iridium SFX development costs and $113,987 had been drawn down. Beam repaid the
loan in full in October 2020 and the facility has been terminated.
ANN UAL REP ORT 2021 45
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 14
Lease liabilities
(a) Carry amounts and movements:
At the beginning of the year
Additional
Decrease in liability
At the end of the year
Disclosed as:
Current
Non-current
Year ended
30 June 2021
$
30 June 2020
$
697,536
856,019
-
-
(180,970)
(158,483)
516,566
697,536
207,437
309,129
516,566
182,930
514,606
697,536
The entity does not face a significant liquidity risk with regard to its lease liabilities. Lease liabilities
are monitored within the Group’s treasury function.
The incremental borrowing rate applied to various lease liabilities recognised under AASB 16 ranges
between 7.30% - 8%
The maturity analysis of lease liabilities are disclosed in Note 17(d).
15
Provisions
Current
Employee benefits
Warranty costs
Non-current
Employee benefits
(a) Movements in provisions
Balance at the beginning of the year
Additional provisions
Amounts used
Balance at the end of the year
1,001,500
1,082,979
100,424
211,132
1,101,924
1,294,111
48,112
47,120
Employee Benefits
Warranty
Costs
Total
1,130,099
211,132
1,341,231
730,004
23,220
753,224
(810,491)
(133,928)
(944,419)
1,049,612
100,424
1,150,036
46 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 16
Issued capital
Issued and paid up capital:
Ordinary fully paid shares
Year ended
30 June 2021
$
30 June 2020
$
12,703,060
7,646,641
The Company has 75,052,952 ordinary shares on issue at 30 June 2021 (2020: 52,873,452).
No. of shares
$ per share
Total $
Balance at 30 June 2020
Shares Issued, net of transaction costs (a)
Shares issued on the exercise of options (b)
Balance at 30 June 2021
52,873,452
21,272,000
907,500
75,052,952
-
0.2500
0.1950
7,646,641
4,879,457
176,963
12,703,060
(a) Shares issued
The Group issued two placement tranches for 13,218,362 and 8,053,638 ordinary shares on 19 October 2020 and 8 December
2020 respectively for $0.25 per share. Proceeds from the capital raise were used to close high-interest loan facilities during the
financial year and will be used to fund sales and device development activities. The total transaction costs for issuance of the
shares was $438,543 including an option expense of $85,500, charged to Reserves, for the Group’s corporate advisor, Peak Asset
Management.
Investors participating under the placement were issued with one option for every three new shares allocated (1:3 attaching
options), totalling 7,090,667 options, and the Group’s corporate advisor, Peak Asset Management, also received 1,500,000 share
options as payment for corporate advisory services provided. (See also Note 21.) Shareholder approval for the options issued to
the investors and Peak Asset Management was obtained at the Company’s Annual General Meeting on 30 November 2020. These
options have an expiry date of 31 December 2022 on the terms and conditions set out in the placement agreement and were
exercisable from 30 November 2020 at $0.50 per share (Issue BCC60 & BCC61).
(b) Exercise of options
On 30 November 2020, 907,500 options, which had been granted on 24 December 2015 to a director with an expiry date of 30
November 2020 on the terms and conditions set out in the Company’s Share Option Incentive Plan, were exercised by the holder.
These options had been exercisable since 30 June 2016 at $0.195 per share (Issue WRR57). The shares were issued on 3 December
2020. (See also Note 21.)
(c) 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.
(d) Capital management
When managing capital, management’s objective is to ensure the Consolidated Group continues as a going concern as well as to
maintain optimal returns toshareholders and benefits for other stakeholders.
No dividends have been paid or declared in respect of ordinary shares for the 2021 financial year or prior years.
The Consolidated Group effectively manages its capital by assessing the financial risks and adjusting its capital structure in
response to changes in these risks and in the market. These responses include the management of debt levels, distributions to
shareholders, share issues, or convertible note issues.
ANN UAL REP ORT 2021 47
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
17
Financial instruments
The Consolidated Group undertakes transactions in a range of financial instruments including:
- cash assets;
- receivables;
- payables;
- deposits
Activities undertaken by entities within the Consolidated Group result in exposure to a number of financial risks, including market
risk interest rate risk, foreign currency risk, credit risk and liquidity risk.
Due to the size of operation conducted by the Consolidated Group, risk management is monitored directly by the Board of Directors
of the parent company with the aim of mitigation of the above risks and reduction of the volatility on the financial performance of
the Group.
The risks associated with material financial instruments and the Consolidated Group’s policies for minimising these risks are detailed
below:
(a) Interest rate risk management
Interest rate risk refers to the risk that the value of a financial instrument or cash flows associated with the instrument will fluctuate
due to changes in market interest rates.
Interest rate risk for the Consolidated Group primarily arises from:
- Bank Funding - Facilities are provided by the Consolidated Group’s bankers and if drawn upon are at variable interest rates based
upon Business Overdraft Prime Indicator rates plus a risk margin. The group diligently manages the facilities and its
accompanying rate risk in its daily operations by keeping the net debt portfolio at a minimum level or in an in-funds position.
These risk exposures related to the financial instruments are not considered material and therefore no sensitivity analysis has been
provided.
Financial Instrument Composition and Maturity:
The Consolidated Group’s exposure to interest rate risk, and the effective weighted average interest rates on classes of financial
assets and financial liabilities, is as follows:
Floating Interest
Fixed Interest Weighted Average
Interest Rate
Non-Interest
bearing
TOTAL
2021
Financial asset
Cash assets
Receivables
TOTAL
Financial liability
Payables (excluding deferred income)
Lease liabilities
TOTAL
2020
Financial asset
Cash assets
Receivables
TOTAL
Financial liability
Payables (excluding deferred income)
Lease liabilities
TOTAL
3,707,484
-
3,707,484
-
-
873,960
-
873,960
-
-
-
-
516,566
516,566
-
-
-
0.00%
0.00%
0.00%
7.36%
0.00%
0.00%
-
3,156,473
3,156,473
3,707,484
3,156,473
6,863,957
2,530,769
2,530,769
-
516,566
2,530,769
3,047,335
-
2,337,993
2,337,993
873,960
2,337,993
3,211,953
-
-
-
1,031,426
697,536
1,728,962
10.00%
7.36%
3,017,601
4,049,027
-
697,536
3,017,601
4,746,563
17
Financial instruments (continued)
(b) Foreign currency risk management
Foreign currency risk refers to the risk that the value of a financial commitment, recognised asset or liability will fluctuate due to
changes in foreign currency rates. The Consolidated Group conducts the majority of its receivable and payable transactions in
foreign currency, primarily in US Dollars. The Group’s foreign currency exchange risk arises from the holding of foreign currency
deposits and transactions in normal trading operations resulting in trade receivables and payables being held at balance date.
Foreign currency risk sensitivity:
If foreign exchange rates were to increase/decrease by 10% from rates used to determine values as at reporting date then the
impacts on profit and equity due to unrealised foreign currency exchange gains or losses on foreign currency deposits and trade
receivables and payables are as follows:
Impact on profit after tax
Impact on equity
Foreign
currency
movement
Year ended
30 June 2021
$
30 June 2020
$
+/- 10%
+/- 157,692
+/-68,382
+/- 10%
+/- 157,692
+/-68,382
The above sensitivity reflects the low net holding of foreign currency financial instruments at balance date. Whilst foreign
currency payables and receivables are largely offsetting during the year, the Group monitors and manages the associated currency
risks in order to reduce the impact of market risk volatility, therefore no further sensitivity analysis has been provided.
(c) Credit risk management
Credit risk is the risk that a contracting entity will not complete its obligations under a financial instrument and cause a financial
loss to the Consolidated Group.
The credit risk on financial assets of the Consolidated Group that have been recognised in the statement of financial position is
the carrying amount, net of any provision for doubtful debts. The Consolidated Group minimises credit risk by performing credit
assessments on all new customers, continuing major customers, and where necessary, obtaining advance payments.
Ongoing credit evaluation is performed on the financial condition of customers and, where appropriate, an allowance for doubtful
debts is raised.
The Consolidated Group does not have any credit risk arising from money market instruments, foreign currency contracts, cross
currency and interest rate swaps.
ANN UAL REP ORT 2021 49
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 17
Financial instruments (continued)
(d) Liquidity risk management
Liquidity risk includes the risk that, as a result of the Consolidated Group’s operational liquidity requirements, the Group:
- will not have sufficient funds to settle a transaction on the due date;
- will be forced to sell financial assets at a value which is less than what they are worth;
- may be unable to settle or recover a financial asset at all.
To help reduce these risks the Consolidated Group:
- has a liquidity policy which targets a minimum and average level of cash and cash equivalents to be maintained; and
- monitors forecast cash flows and endeavours to ensure that adequate borrowing facilities are maintained and/or maturity
dates are managed appropriately.
The Consolidated Group’s exposure to liquidity risk on classes of financial assets and financial liabilities, is as follows:
< 1 Year
1 - 5 Years
Total contractual
cash flows
Carrying
amount
2021
Asset/Liability class
Cash and cash equivalents
3, ,707,484
-
3,707,484
3,707,484
Receivables
3,043,008
113,465
3,156,473
3,156,473
Payables (excluding deferred income)
(1,795,657)
(735,112)
(2,530,769)
(2,530,769)
Lease liabilities
Net maturities
2020
Asset/Liability class
(207,437)
(309,129)
(516,566)
(516,566)
4,747,398
(930,776)
3,816,622
3,816,622
Cash and cash equivalents
873,960
-
873,960
873,960
Receivables
2,224,471
113,522
2,337,993
2,337,993
Payables (excluding deferred income)
(3,230,290)
(818,737)
(4,049,027)
(4,049,027)
Lease liabilities
Net maturities
(182,930)
(514,606)
(697,536)
(697,536)
(314,789)
(1,219,821)
(1,534,610)
(1,534,610)
(e) Net fair values of financial assets and liabilities
Secured loan with Roadpost lnc. was measured at fair value under AASB 13 and classified as Level 3 in the fair value hierarchy.
The Group received a financing benefit, being non-cash consideration, in the form of an interest free loan. The Group used a
discount rate of 6% to calculate its interest free benefit when it was recorded in the previous financial year. This assumption is
not directly observable. Any increase in the discount rate would decrease the fair value of the loan.
50 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 Year ended
30 June 2021
30 June 2020
$
$
2,294,233
2,707,924
-
-
295,754
-
2,294,233
3,003,678
18
Commitments and contingencies
Capital expenditure projects
Not longer than one year
Longer than one year and not longer than five years
Longer than five years
Capital commitments relate to product development projects being undertaken by the subsidiary,
Beam Communications Pty Ltd.
Superannuation commitments
Beam Communications Holdings Limited makes superannuation contributions to prescribed
superannuation funds on behalf of employees and executive directors, as required by the
Superannuation Guarantee legislation. The principal types of benefits are death, permanent disability
and superannuation benefits upon retirement
ANN UAL REP ORT 2021 51
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 19
Notes to the statement of cash flows
(a) Reconciliation of Profit / (loss) after income tax benefit to net cash flow
from operating activities
Profit / (loss) after tax
Adjustments for
Depreciation
Amortisation
Impairment
Net loss on disposal of plant and equipment
Share of loss in joint venture
Unrealised foreign currency net losses
Interest free benefit
Notional interest expense
Changes in assets and liabilities:
Increase in trade and other receivables
(Increase) / Decrease in inventory
(Increase) / Decrease in deferred tax assets
Decrease in trade and other payables
Increase / (Decrease) in employee provisions
Increase / (Decrease) in provision for warranty costs
Increase in provision for stock obsolescence
Net cash provided by operating activities
(b) Reconciliation of cash
Year ended
30 June 2021
30 June 2020
$
$
509,178
(1,629,234)
199,926
211,015
810,451
1,520,080
-
2,791,218
3,152
137,080
(27,234)
13,486
389,617
158,113
-
(163,470)
41,992
50,773
(832,809)
(281,326)
469,109
(889,059)
419,244
(122,266)
(640,891)
(662,993)
(80,488)
(110,708)
35,000
98,461
19,972
50,000
933,002
1,554,387
Cash at the end of the financial year as shown in the consolidated statement of cash flows is
reconciled to items in the consolidated statement of financial position as follows:
3,707,484
873,960
Cash and cash equivalents (Note 4)
(c) Non cash financing and investing activities
Non cash financing and investing activities undertaken by the Consolidated Group during the year
are disclosed in Note 21.
52 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 (d) Banking facilities
All bank facilities are secured by first ranking Registered Mortgage Debenture over the Consolidated Group’s assets
including uncalled capital and called but unpaid capital. At 30 June 2021, the company had the following unused
bank facilities:
- an Australian dollar overdraft with a limit of $300,000. The overdraft was not utilised at 30 June 2021.
- a US dollar overdraft with a limit of US$320,000. The US dollar overdraft was not utilised at 30 June 2021.
Bank guarantee facilities of the Consolidated Group total $150,000 of which $100,000 has been allocated to a
subsidiary company and $50,000 to the parent. Both were fully utilised at 30 June 2021.
The Consolidated Group’s banking facilities are no longer subject to the Group satisfying quarterly covenants set by
the bank. The bank reconfirmed the banking facilities as continuing on 25 August 2021.
On 1 July 2020 the Group received a 3-year-term loan from the National Australia Bank of $500,000, a business
support loan designed to help mitigate the impact of COVID-19 and partially secured by the Australian government.
The Group started making monthly loan repayments for the loan in February 2021. On 10 May 2021, the Group
received funds of $500,000 from a further 3-year-term loan for COVID-19 business support from the same bank
under the same conditions.
On 19 May 2021 the outstanding principal of both loans totalling $972,970 was repaid in full and converted into
a new redrawable partially secured five-year loan facility for the same amount. As at 30 June 2021, the combined
5-year facility was undrawn.
20
Key management personnel disclosures
Compensation by category
The aggregate compensation made to directors and other members of key management personnel of
the consolidated entity is set out below:
Short-term employee benefits
Post-employee benefits
Other long-term benefits
Termination benefits
Share-based payments
Year ended
30 June 2021
30 June 2020
$
$
1,119,438
1,133,349
78,254
78,428
1,849
13,365
-
-
-
-
1,199,541
1,225,142
ANN UAL REP ORT 2021 53
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 21
Share based payments
(a) Share Option Incentive Plan
Share options under the Share Option Incentive Plan are granted at the discretion of the directors based on terms and conditions
set out in theCompany’s Share Option Incentive Plan. The directors may at any time and from time to time determine eligible
persons for the purposes of the option plan and select amongst those eligible persons participants who will be invited to
participate in the option plan.
Options issued to directors pursuant to the option plan will be subject to approval of shareholders in general meeting, in
compliance with the Listing Rules.
No share options issued under the Share Option Incentive Plan remained on issue at 30 June 2021.
(i) 789,525 options were granted on 24 December 2015 to key employees with an expiry date of 31 August 2020 on the terms
and conditions set out in the Company’s Share Option Incentive Plan. These options were exercisable from 30 June 2016 at
$0.195 per share (Issue WRR56)
789,525 options lapsed on 31 August 2020.
(ii) 907,500 options were granted on 24 December 2015 to a director with an expiry date of 30 November 2020 on the terms
and conditions set out in the Company’s Share Option Incentive Plan. These options were exercisable from 30 June 2016 at
$0.195 per share (Issue WRR57).
These options were exercised on 30 November 2020 and 907,500 shares were issued on 3 December 2020.
The following table illustrates the number (No.) and weighted average exercise prices (WAEP) and movements in share options
issued under the Share Option Incentive Plan during the year for the Company:
Outstanding at the beginning of the financial year
Lapsed during the financial year
Exercised during the financial year
Outstanding at the end of the financial year
Exercisable at the end of the financial year
(b) Other share based payments
30 June 2021
30 June 2020
No. WAEP $
No. WAEP $
1,697,025
0.1950
2,486,550
0.1950
(789,525)
-
(789,525)
(907,500)
0.1950
-
-
-
-
-
-
-
1,697,025
0.1950
1,697,025
0.1950
During the financial year, the Group issued 1,500,000 share options to the Group’s corporate advisor, Peak Asset
Management, as payment for corporate advisory services provided. (See also Note 16.)
The fair value of the options was determined using the Black-Scholes option valuation model as detailed below.
Grant date
Expiry date
Share price at valuation date
Exercise price per option
Expected volatility
Dividend yield
Risk-free interest rate
Fair value per option at grant date
30 November 2020
31 December 2022
0.2850
0.5000
65%
-
0.085%
0.0570
54 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 22
Remuneration of auditors
Remuneration of the Auditor for auditing or reviewing financial reports of the Consolidated Group
69,400
75,800
Year ended
30 June 2021
30 June 2020
$
$
Year ended
30 June 2021
30 June 2020
$
$
2,357,459
2,450,879
(40,603)
(87,978)
-
-
-
16,854
(45,893)
971,392
23
Related party transactions
Related party transactions with the Season Group and SGV1 Holdings Limited, which were related to
Mr Carl Hung, a former Director of Beam Communications Holdings Limited:
Transactions with Season Group
- Purchases
- Sales
Amounts outstanding with the Season Group
- Receivables
- Payables
Transactions with SGV1 Holdings Limited
- Secured Loan Payable
Mr Carl Hung was a director of the Company until his retirement on 30 November 2020 and
remained a related party until 31 May 2021. He is the president and a director of the Season Group.
Transactions between the Company and the Season Group during the time he was a related party
to the Company were on normal commercial terms and conditions no more favourable than those
available to other parties.
There was no finance facility with a related party as at 30 June 2021. The Group’s secured finance
facility with a major shareholder SGV1 Holdings Limited, a company associated with Mr Carl Hung, a
former Director of the Company, was fully settled on 28 October 2020.
ANN UAL REP ORT 2021 55
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 24
Earnings per share
Overall operations
Basic earnings (loss) per share
Diluted earnings (loss) per share
Year ended
30 June 2021 30 June 2020
¢
0.76
0.76
¢
(0.31)
(0.31)
No.
No.
Weighted average number of ordinary shares used in the calculation of Basic Earnings Per Share
67,139,375
52,873,452
Weighted average number of dilutive options on issue
Weighted average number of ordinary shares and potential ordinary shares used in the calculation of
Dilutive Earnings Per Share
-
-
67,139,375
52,873,452
Anti-dilutive options on issue not used in dilutive EPS calculation
8,590,667
1,697,025
Anti-dilutive options have not been considered in the dilutive earnings per share calculation due to the
average market price being equal to or very close to the exercisable price.
Earnings:
Earnings (loss) used in the calculation of Basic Earnings Per Share
Earnings (loss) used in the calculation of Dilutive Earnings Per Share
$
$
509,178
(1,629,234)
509,178
(1,629,234)
25
Segment Reporting
(a) Sole operating segment
The Consolidated Group has identified operating segments based upon internal reports that are reviewed and used
by the Directors in assessing performance and determining the allocation of resources in respect of its satellite
communications products services and online sales. As the online sales segment operated by SatPhone Shop Pty
Ltd, a wholly owned subsidiary company, does not meet the quantitative threshold for separate disclosure, the
company considers its aggregate segment as it sole segment. Accordingly, revenue and results are fully disclosed
in the consolidated statement of profit or loss and other comprehensive income for this aggregated sole operating
segment.
The consolidated statement of financial position discloses the sole operating segment assets and liabilities which
are held within Australia
(b) Major customers
The Consolidated Group has a number of customers to whom it provides products and services. The Consolidated
Group supplied a single customer in Canada accounting for 29% of external revenue (2020: the largest customer
was in the United States, 19%) and the second largest customer, located in the United States, accounted for 13% of
external revenue (2020: the second largest customer was in Canada, 7%). Thenext most significant customer also
accounts for 10% of external revenue (2020: 6%).
56 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 Year ended
30 June 2021
30 June 2020
$
$
(564,814)
(694,156)
(419,244)
122,266
(984,058)
(571,890)
-
-
(984,058)
(571,890)
1,855,443
412,459
1,017,389
1,611,491
2,872,832
2,023,950
1,646,051
4,750,545
357,241
561,726
2,003,292
5,312,271
869,540
(3,288,321)
12,703,060
7,646,641
85,500
320,394
(11,919,020)
(11,255,356)
869,540
(3,288,321)
26
Parent company disclosures
Set out below is the supplementary information about the parent entity.
(a) Statement of profit or loss and other comprehensive income
Loss from continuing operations
Tax expense
Loss for the year attributable to owners of the Company
Other comprehensive income
Total loss and other comprehensive income for the year attributable
to owners of the Company
(b) Statement of financial position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net assets (deficiency)
Equity
Issued capital
Reserves
Accumulated losses
Total equity
(c) Guarantees
The parent company has no contractual guarantees in place.
(d) Contractual commitments
The parent entity has no capital expenditure commitments.
(e) Significant accounting policies of the parent are the same as those for the consolidated entity.
ANN UAL REP ORT 2021 57
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 27
Controlled entities
Investments in unquoted corporations being controlled entities:
2021
2020
Beam Communications Pty Ltd
Australia
Ordinary
100%
100%
Incorporated
Share class
Holding
SatPhonerental Pty Ltd
SatPhone Shop Pty Ltd
Beam Communications USA Inc
Pacarc (PNG) Limited (Dormant)
28
Impacts of COVID-19
Australia
Ordinary
100%
100%
Australia
Ordinary
100%
100%
USA
Ordinary
100%
100%
Papua New Guinea
Ordinary
100%
100%
Despite the ongoing challenges created by the COVID-19 pandemic, the Group did not experience a profound impact on
its sales and operations and recovered strongly to return to a profitable position during the financial year.
The Group qualified for government grants for businesses in the wake of the pandemic. Following the $270,000 received
from April to June in 2020, the Group continued to receive the first round of JobKeeper payments and the total amount
received during the financial year was $309,000. The Group became ineligible for the second phase of the grant, which
commenced on 28 September 2020, due to its solid recovery in sales. Additionally, the Group was qualified for a Cash
Flow Boost of $38,000 from the Australian Taxation Office and a Business Support Fund of $20,000 from the Victoria
State Government during the year.
29
Events after the reporting period
The Directors are not aware of any significant events since the end of the year.
30
Company details and principal place of business
Beam Communications Holdings Limited is a limited company incorporated in Australia.
The principal activities of the Company and subsidiaries are outlined in the Director’s Report.
The address of its registered office and principal place of business is:
5 / 8 Anzed Court
Mulgrave Victoria 3170
Australia
58 BEAM COMMUN ICATIONS H O LD IN GS L I MI T E D
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2021 DIRECTORS ‘ DECLARATION
DIRECTORS’ DECLARATION
The directors of Beam Communications Holdings Limited declare that:
1. The financial statements and notes as set out in pages 30 to 60 are in accordance with the Corporations Act 2001 and:
(a) comply with Australian Accounting Standards, which, as stated in accounting policy Note 1 to the financial statements, constitutes
compliance with International Financial Reporting Standards;
(b) give a true and fair view of the financial position as at 30 June 2021 and of the performance for the year ended on that date of the company
and consolidated group; and
(c) any other matters that are prescribed by the regulations for the purposes of this declaration in relation to the financial statements and the
notes for the financial year are also satisfied.
2. In the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due
and payable.
This declaration has been made after receiving the declarations required to be made by the Chief Executive Officer and Chief Financial Officer to the
directors in accordance with sections 295A of the Corporations Act 2001 for the financial year ending 30 June 2021.
This declaration is made in accordance with a resolution of the Board of Directors on 30 August 2021.
Mr Simon Wallace
Chairman
Date: 14/09/21
Ann ua l Repo rt 2021 59
The demand for the highly reliable smartphone-to-satellite
connectivity device Iridium GO! remains strong.
Beam have manufactured over 50,000 units since the
product launch in 2014.
RSM Australia Partners
Level 21, 55 Collins Street Melbourne VIC 3000
PO Box 248 Collins Street West VIC 8007
T +61 (0) 3 9286 8000
F +61 (0) 3 9286 8199
www.rsm.com.au
INDEPENDENT AUDITOR’S REPORT
To the Members of Beam Communications Holdings Limited
Opinion
We have audited the financial report of Beam Communications Holdings Limited (the Company) and its
subsidiaries (the Group), which comprises the consolidated statement of financial position as at 30 June 2021,
the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of
changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial
statements, including a summary of significant accounting policies, and the directors' declaration.
In our opinion the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
(i) giving a true and fair view of the Group's financial position as at 30 June 2021 and of its financial
performance for the year then ended; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board's
APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial
report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We 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 of the current period. These matters were addressed in the context of our audit of the financial
report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
THE POWER OF BEING UNDERSTOOD
AUDIT | TAX | CONSULTING
41
RSM Australia Partners is a member of the RSM network and trades as RSM. RSM is the trading name used by the members of the RSM network. Each member of the
RSM network is an independent accounting and consulting firm which practices in its own right. The RSM network is not itself a separate legal entity in any jurisdiction.
RSM Australia Partners ABN 36 965 185 036
Liability limited by a scheme approved under Professional Standards Legislation
Key Audit Matters (continued)
Key Audit Matter
How our audit addressed this matter
Impairment of Intangible Assets
Refer to Note 11 in the financial statements
The Group has intangible assets of $5.5m, being
capitalised development costs relating to the Marconi,
GO! SFX and Zoleo Post Launch projects.
The Marconi asset was available for use from January
2020, and therefore amortisation commenced during
FY20. The GO! SFX project and Zoleo Post Launch were
not available for use as at 30 June 2021.
Management have performed an impairment assessment
for material project assets based on a value in use
calculation, which determined that no impairment had
occurred.
We identified this area as a Key Audit Matter due to the
size of the intangible assets balance, the management
judgement required to assess whether any indicators of
impairment exist, and where any indicators of impairment
existed, management judgement involved in determining
the value in use of the relevant assets based on the
estimated future cash flows generated.
Fair Value of Interest Free Loan
Refer to Note 13 in the financial statements
The group has a $0.74m loan that bears no interest.
Given the nature of the loan, the determination of the fair
value of the loan can be complex and requires significant
management estimate and judgement. Further, the
correct accounting treatment between the fair value of the
loans and the face value of the loans can be complex. For
the reasons noted above, accounting for the above loan
was considered a key audit matter.
Our audit procedures in relation to intangible assets included:
Assessing management’s review for any indicators of
impairment;
Where indicators existed, assessing management’s
impairment assessment by checking the mathematical
accuracy of the cash flow model, and reconciling input
data to supporting evidence, such as approved budgets
and considering the reasonableness of these budgets;
Challenging the reasonableness of key assumptions,
including the cash flow and revenue projections,
revenue growth rate, exchange rates, discount rates,
and any sensitivities used; and
Confirming our understanding of the nature of the
intangible assets, the strategic purpose of the projects
and its ability to generate future revenues through
discussions with management.
Reviewing the adequacy of disclosures against the
requirements of AASB 136.
Our audit procedures in relation to the accounting for interest
free loans included:
Reviewing the loan agreement to verify loan amount,
interest rate and maturity date;
Obtaining confirmation from the lender verifying he loan
balance at balance date;
Assessing management’s assumptions in determining
the fair value of the loan, including the discount
rate/market interest rate used; and
Reviewing the accounting treatment for the difference
between fair value of the loan and the face value of the
loan.
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Group's annual report for the year ended 30 June 2021, but does not include the financial report and the
auditor's report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial report or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
42
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic
alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and
Assurance Standards Board website at: www.auasb.gov.au/auditors_responsibilities/ar2.pdf. This description
forms part of our auditor's report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in the directors' report for the year ended 30 June 2021.
In our opinion, the Remuneration Report of Beam Communications Holdings Limited., for the year ended 30 June
2021, 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.
RSM AUSTRALIA PARTNERS
M PARAMESWARAN
Partner
Dated: 30 August 2021
Melbourne, Victoria
43
AUSTRALIAN SECURITIES EXCHANGE INFORMATION
AUSTRALIAN SECURITIES EXCHANGE INFORMATION
VOTING RIGHTS
As at 31 August 2021.
This section includes information required by ASX Listing Rules which is
not disclosed elsewhere in this Annual Report.
TWENTY LARGEST SHAREHOLDERS
DAVID STEWART
FF OKRAM PTY LTD
SGV1 HOLDINGS LIMITED
MICHAEL CAPOCCHI
BOLIVIANOS GROUP
TRENT MILLAR
Number
10,905,000
8,634,258
5,409,874
2,671,897
2,482,117
2,000,000
% of
Class
14.53%
11.50%
7.21%
3.59%
3.31%
There are 75,052,952 ordinary fully paid shares held by 1,374 members
and these are the only class of share currently issued. The Company's
Constitution provides that every member present in person, by proxy or
by corporate representative or by appointed attorney shall on the show
of hands have one vote and shall on a poll have one vote for each fully
paid share held. The Constitution also authorises the Chairman to adopt
any procedure which is in the Chairman's opinion necessary or desirable
for the proper and orderly casting or recording of votes at any general
meeting of the Company, whether on a show of hands or on a poll.
SUBSTANTIAL SHAREHOLDERS
DAVID STEWART
2.66%
FF OKRAM PTY LTD
Number of
Shares
% of
Class
10,905,000
14.53%
8,634,258
11.50%
ARTPRECIATION PTY LTD
1,798,632
2.40%
HSBC CUSTODY NOMINEES
VINCENT GALANTE
HOTTON FAMILY
BNP PARIBAS NOMINEES P/L
RAPAKI PTY LTD
CATCH 88 PTY LTD
TOM BEKIARIS
CITICORP NOMINEES PTY LTD
ANNA VOCALE
NHAN PHAM
PAUL RIETHMAIER
DAVSAM PTY LTD
1,653,157
1,354,146
2.20%
1.80%
1,115,500
1.49%
1,100,537
1,076,473
897,485
881,835
843,227
800,000
785,000
600,277
590,000
1.47%
1.43%
1.20%
1.17%
1.12%
1.07%
1.05%
0.80%
0.79%
ROBERT MANSFIELD NIALL
527,200
0.70%
- These shareholders do not hold any options to subscribe for ordinary shares.
DISTRIBUTION OF SHARES
Size of Holdings
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Number of
Number of
Holders
Shares
%
265
75,854
392
1,145,596
220
1,747,543
0.10%
1.53%
2.33%
417
14,095,128
18.78%
80
57,988,831
77.26%
TOTAL
1,347
75,052,952
100.00%
TOTAL TOP 20:
46,126,615
61.46%
HOLDERS OF LESS THAN A MARKETABLE PARCEL OF QUOTED
TOTAL ISSUED
75,052,952
100.00%
HOLDERS OF EACH CLASS OF EQUITY SECURITY
The company has issued:
-75,052,952 ordinary fully paid shares to 1,374 shareholders.
-8,590,667 options to subscribe for ordinary shares to
291 option holders.
ORDINARY SHARES
Number of
% of Total
Number of
% of Total
Holders
Holders
Shares
Quoted Shares
356
25.91%
221,904
0.30%
64 BEAM COMMUN ICATIONS H O LD IN GS LI M I T E D