Annual Report 2021
Pioneering
Regenerative
Supply Chains
Brambles’ ambition is to pioneer
regenerative supply chains.
As a leader in sustainability, Brambles
is working to create a nature and people
positive economy with reuse, resilience
and regeneration at its core. It means
breaking the link between consumption
and harm to the environment and society.
It means moving from degenerative
systems that waste resources and pollute
the environment to regenerative models
that restore nature and strengthen society.
In other words, putting back in more than
we take from the world. By reaching zero
impact and beyond, Brambles will be the
company delivering the supply chains the
world needs for the future.
Contents
Brambles at a Glance
Letter from the Chair and CEO
Operating & Financial Review
Board & Executive Leadership Team
Directors’ Report – Remuneration Report
Directors’ Report – Additional Information
Shareholder Information
Consolidated Financial Report
Independent Auditor’s Report
Auditor’s Independence Declaration
Five-Year Financial Performance Summary
Glossary
To view the Group’s annual review
for FY21, go to:
brambles.com
1
4
8
38
45
65
71
73
129
135
136
137
About this Report
Brambles recognises that transparent reporting is an essential part of its responsibility to its shareholders and other stakeholders,
and to maintain its licence to operate.
Integrated Reporting
Brambles is adopting the Value Reporting Foundation methodology, which combines the Integrated Reporting ‘capitals’ framework
and the Sustainable Accounting Standards Board (SASB) standards. IR, which has been adopted in this Annual Report, illustrates the
interaction and interdependencies between a business’ sources of value, its model and its ability to create value over time. SASB, which
will be adopted in our Sustainability Review (to be released in September 2021), provides industry-specific sustainability indicators.
This holistic approach aims to help Brambles’ stakeholders understand its sources of value, including resource dependencies and the
positive and negative impacts of its business on these sources of value. This is the first year that Brambles will align its disclosures in the
Sustainability Review to SASB.
Brambles also follows the guidance provided by the Financial Stability Board’s Task Force on Climate-Related Financial Disclosures
(TCFD) voluntary disclosure framework (TCFD Framework). Our FY21 TCFD disclosure, within the Annual Report, details how we consider
governance, risk management, strategy, metrics and targets in relation to climate change. This will be supported by a TCFD supplement
on Brambles’ website.
All acronyms and terminology referred to in this report are defined in the Glossary on pages 137-139.
Forward-Looking Statements
Certain statements made in this report are “forward-looking statements” – that is, statements related to future, not past, events. Words
such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “will”, “should”, and similar expressions are intended
to identify forward-looking statements. These forward-looking statements are not historical facts, but rather are based on Brambles’
current beliefs, assumptions, expectations, estimates and projections. Forward-looking statements are not guarantees of future
performance, as they address matters that are uncertain and subject to known and unknown risks, and other factors that are beyond
the control of Brambles, are difficult to predict and could cause actual results to differ materially from those expressed or forecast in
the forward- looking statements. Brambles cautions shareholders and prospective shareholders not to place undue reliance on these
forward-looking statements, which reflect the views of Brambles only as of the date of this report. The forward-looking statements made
in this report relate only to events as of the date on which the statements are made – Brambles will not undertake any obligation to
release publicly any revisions or updates to these forward-looking statements to reflect circumstances or events occurring after the date
of this report, except as may be required by law or by any appropriate regulatory authority. Past performance cannot be relied on as a
guide to future performance.
Brambles Limited
ABN 89 118 896 021
Brambles at a Glance
1
As a pioneer of
the sharing economy,
Brambles is one of the
world’s most sustainable
logistics businesses.
Brambles’ purpose
is to connect people
with life’s essentials,
every day.
Through its ‘share and
reuse’ model, Brambles
moves more goods
to more people in
more places than any
other organisation.
What Brambles does:
Brambles’ platforms form the invisible
backbone of global supply chains, primarily
serving the fast‑moving consumer goods,
fresh produce, beverage, retail and general
manufacturing industries.
Its circular business model facilitates the
‘share and reuse’ of the world’s largest pool
of reusable pallets and containers.
This enables Brambles to serve its customers
while minimising the impact on the
environment and improving the efficiency
and safety of supply chains around the world.
The world’s largest brands trust Brambles
to help them transport life’s essentials more
efficiently, safely and sustainably.
2
2
As at 30 June 2021, Brambles:
Operated in...
~60
countries
Owned...
~345 million
pallets, crates and containers
Employed...
~12,000
people
Through a network of…
750+
service centres
Brambles at a Glance
3
Highlights
Financial
Sustainability
US$5,209.8m
Sales Revenue – Up 7% at constant currency.
US$879.3m
Underlying Profit – Up 8% at constant currency.
17.8%
Ellen MacArthur Foundation
(achieved A-)
Maximum AAA rating
Top 4% of companies
assessed
Return on Capital Invested – Up 1.1 percentage points
at constant currency.
A- in its Forests submission
18th most sustainable
company in the world
Rated #2 most sustainable
international company
US$901.1m
Cash Flow from Operations – Up US$146.3m.
20.5 US cents per share
Total Dividends – Final dividend of
10.5 US cents per share.
Safety
5.0
Brambles Injury Frequency Rate (BIFR) –
Down from 5.5 in FY20.
44
Letter from the Chair & CEO
In FY21, Brambles played a critical role in keeping global supply chains
open, enabling the flow of essential goods around the world. At the
same time, the focus and agility of our people has allowed us to deliver
on all of our financial commitments while laying the foundations for an
ambitious future.
Towards a
regenerative
supply chain
Strong revenue growth and
Underlying Profit leverage
delivered in a challenging
operating environment
Letter from the Chair & CEO
5
As a global leader in sustainability, we are
also pleased to announce that in June 2021
we took our first critical step towards a
regenerative business model by becoming
a carbon neutral company, bringing the
net CO2 emissions derived from our own
operations to zero. This is an important
milestone in our decarbonisation journey;
however, we acknowledge that the real
challenge lies in the activities of our whole
supply chain. We have started collaborative
actions with customers, suppliers and
external organisations to advance in our
commitment for a 1.5ºC future, aligned
with the 2015 Paris Agreement.
With COVID-19 restrictions starting to ease
around the world and developed countries
entering the recovery phase of the
pandemic, our priority remains the health
and wellbeing of our people and being
a reliable and responsible supply chain
partner to our customers around the world.
Global supply chains have experienced
significant disruptions since the COVID-19
pandemic began over a year ago. Our
teams around the world have adapted
to unprecedented changes in customer
demands and network dynamics across
our global operations. We are particularly
proud of our service centre staff who have
been on the frontline, working tirelessly
to ensure global supply chains continued
to function effectively, despite a range of
COVID-19 and Brexit-related challenges.
During the Year, demand for our pallets
was strong, yet volatile, as retailers and
manufacturers responded to record
levels of at-home consumption and
increased their inventory levels to manage
supply chain risk and consumer demand
uncertainty. At the same time, our
businesses were faced with high levels
of lumber inflation, pallet availability
challenges and ongoing scarcity of both
labour and transport in all regions. These
dynamics required a high level of agility
across our operations to keep goods
flowing through supply chains.
Against this challenging backdrop, we
successfully completed our three-year
US automation programme which has
progressively added capacity to our
US service centre network. In addition,
our investments in US lumber and
related procurement initiatives delivered
efficiency and supply benefits in the
period. Our teams in all regions continued
to demonstrate commercial discipline,
recovering cost-to-serve increases through
pricing, surcharges, and underlying cost
efficiencies across our network. The
collective benefits of these actions offset
cost increases during the Year, enabling
us to meet all our financial commitments
for FY21, including Group revenue growth
with operating profit leverage, US margin
improvement and strong Free Cash Flow
generation to fully fund dividends and
capital expenditure.
6
Letter from the Chair & CEO continued
We are in the process of finalising our
transformation plan and will be in a
position to provide further information on
specific initiatives, expected future
financial outcomes and more
specific guidance for FY22, including
transformation programme costs, at our
Investor Day on 13 and 14 September 2021.
To enable the delivery of our transformation
and digital ambitions, we have created
two new roles on the Executive Leadership
team, with Craig Jones becoming the
Group’s Chief Transformation Officer and
Helen Lane being appointed as the Group’s
Chief Data and Digital Officer. In addition,
our Customer Experience transformation
will be led by our Senior Vice President of
Strategy and Innovation, Alasdair Hamblin
(See biographies on pages 38 to 44).
Pioneering Regenerative
Supply Chains
Our ambitions for the business would
not be complete without recognising our
responsibility to drive sustainability across
global supply chains. The 2020s is the
‘decade of action’ on the United Nations
Sustainable Development Goals and, as
a global leader in sustainability and the
backbone of supply chains all over the
world, we believe we have a critical role
to play. The time has come to transform
how we get products to people. That is
why we are setting the ambition to pioneer
truly regenerative supply chains. It is about
delivering life’s essentials every day in a
nature and people positive way, with reuse,
resilience, and regeneration at its core.
By getting to zero impact and beyond, we
will be the company delivering the supply
chains the world needs for the future.
To support this ambition, we launched our
2025 sustainability targets in September
2020, and we are pleased to announce
that we have already started our journey
towards regeneration. In addition to
achieving carbon neutral status, we
have made significant progress with our
afforestation programme, investing in
projects designed to grow the world’s
forest reserves while securing the
essential supply of sustainable lumber
for our operations into the future.
More details about our sustainability
performance and progress with our
2025 sustainability targets will be outlined
in our 2021 Sustainability Review, that will
be released in September 2021.
FY21 Performance
Notwithstanding significant challenges
during the Year, our FY21 performance
was above the upgraded guidance range
provided to the market in February and
reconfirmed in April 2021. At constant
currency, sales revenue increased 7%,
with volume and price realisation in the
global pallets business and a progressive
recovery in the Automotive business.
Underlying Profit increased 8% at constant
currency, reflecting increased contribution
from pricing and surcharges, supply chain
efficiencies and one-off net income of
US$10 million in the Asia-Pacific region.
These contributions to profit more
than offset input-cost inflation, higher
asset charges in the US business and
other operating cost increases, driven
by changes in network dynamics and
demand patterns due to COVID-19, Brexit
and pallet availability challenges in the
second half of the year. Excluding timing
benefits which are expected to reverse
in FY22, Free Cash Flow after dividends
was US$126.2 million, reflecting strong
earnings, asset compensations and
working capital benefits.
Foundations for an
Ambitious Future
Brambles’ purpose is ‘to connect people
with life’s essentials, every day’. As we
continue to contend with the challenges
and complexities created by the COVID-19
pandemic this purpose continues
to underpin our strategy, drive our
endeavours, and motivate our people.
Brambles introduced the platform pooling
model around the world. Our ambition
now is to transform our business and
reinvent pooling for the supply chains
of tomorrow. We are investing to create
new digital and data capabilities that will
unlock additional value from our current
platforms and networks, as well as creating
new sources of value for our customers
and shareholders.
As the global leader in sustainable
logistics, we are committed to raising
standards for customer experience, service
quality, innovation and raising the bar for
the whole industry. We are constantly
seeking to improve asset and network
productivity, with ongoing programmes of
automation and process standardisation
to enhance the efficiency and resilience
of our operations. We are reinventing our
organisation, technology, and processes
to be simpler, more effective, and more
customer focused. We call this ambition
Shaping Our Future.
During the Year, we have undertaken
a focused programme to accelerate
Shaping Our Future and the transformation
it will drive across our business. We
have identified ambitious opportunities
to improve customer value, operate
more efficiently, and embed digitisation
across Brambles.
Consequently, in FY22 we will be
recognising increased investments in
numerous initiatives, which are expected to
drive a significant and sustainable uplift in
shareholder value creation by supporting
revenue growth with operating profit
leverage and Free Cash Flow generation
across the Group from FY23 onwards.
The capital management
programme is now
78% complete
Letter from the Chair & CEO
7
Dividend and Capital
Management
Shareholders benefited from Brambles’
strong performance in the Year, with the
Board declaring total dividends for FY21 of
20.5 US cents per share, with the Australian
dollar equivalent of 27.32 Australian cents
per share. Further details of the FY21
dividend are on page 65.
In addition, Brambles continued to return
IFCO sale proceeds to shareholders
through the on-market share buy-back
programme. At 30 June 2021, a total of
158 million ordinary shares have been
bought back for a total consideration of
A$1,752 million. The capital management
programme is now 78% complete and is
expected to be completed in FY22.
Board Renewal
In line with our Board renewal plan,
Tony Froggatt and Tahira Hassan will retire
at the conclusion of the 2021 AGM after
16 years’ and 10 years’ service respectively.
Both Tony and Tahira have made
outstanding contributions to Brambles
throughout their time on the Board and we
thank them for their service. Recruitment
for their replacements on the Board has
been initiated and we expect to appoint two
new directors over the course of the next
six months. Full Board biographies are on
pages 38 to 41. Details of our Board skills
matrix are in the Corporate Governance
Statement on brambles.com
Conclusion
On behalf of the Board, we would like to
thank Brambles’ shareholders for their
continued support and the whole Brambles
team for their hard work and dedication
during the Year.
John Mullen
Chair
Graham Chipchase
Chief Executive Officer
8
Operating & Financial Review
9
How Brambles
Creates Value
Brambles’ ambition is to pioneer regenerative supply chains with reuse, resilience,
and regeneration at its core. Using the power of its circular business model,
network advantage, and expertise, Brambles transforms key inputs into significant
sources of value for stakeholders.
Brambles helps customers deliver life’s essentials every day. Its
end-to-end supply chain solutions deliver operational, financial,
and environmental efficiencies not otherwise available through
single-use alternatives. Further details are available on page 14.
For shareholders, Brambles delivers sustainable growth at
returns well in excess of the cost of capital. Its model generates
sufficient cash flow through the cycle to fund dividends and
support reinvestment in growth, innovation, and the development
of its people. At the same time, Brambles provides an investment
pathway into the low-carbon, circular economy while delivering
consistent growth at returns well above the cost of capital.
For employees, Brambles provides development and exciting career
opportunities in approximately 60 countries. By fostering a culture of
innovation and agility, Brambles’ value proposition seeks to attract
and retain the talent committed to shaping a sustainable future.
In an increasingly resource and climate-conscious world,
low-carbon, circular business models like that operated by
Brambles are recognised as an immediate solution enabling
the world to trade more responsibly. Brambles’ commitment to
regenerate more than it needs and provide its products via a
service helps reduce the pressure on natural capital, including
climate and forests systems, and reduces the waste typical of
conventional single-use, linear business models.
Brambles leverages its unique position in the supply chain to
amplify positive outcomes beyond its business. This includes
enabling customer collaboration, optimising transport networks
and addressing food security while promoting the circular
economy and expanding sustainable forest certification. In this
way, Brambles helps deliver life’s essentials every day, in a nature
and people positive way.
INPUTS
VALUE CREATION
OUTPUTS
Natural Capital
100% wood from certified sources
which regenerates stocks of raw
materials and drives demand for
sustainable forest products
Manufactured Capital
345 million assets shared and reused
throughout the world’s supply chains
Human and Intellectual Capital
Attracting talent, ideas and innovation
Financial Capital
Attracting long-term investment
Social and Relationship Capital
Fostering positive stakeholder
relationships in communities
Brambles’ platforms help
reduce food waste
Producer
Manufacturer
By sharing and reusing Brambles’ products
versus single-use alternatives,
value is created for its customers, the
environment and society
Circular
‘Share and Reuse’
Model
Natural Capital
Social and Relationship Capital
Customer-driven
environmental savings:
2.4m tonnes of CO2;
3,160 megalitres of water;
3.1m cubic metres of wood;
3.2m trees; and
1.4m tonnes of waste
Customer value:
• Enhance operational efficiency;
• Free up cash and resources;
• Lower overall supply chain costs; and
• Sustainable packaging objectives
Building our social licence through
advocacy for a circular economy
2
Committed to zero product
waste to landfill
Transport and other
customer collaboration
Human Capital
Intellectual Capital
Service Centre
100% electricity from
renewable sources1
Retailer
Scale-related
operational efficiencies
Network scale density
and expertise
Growth, innovation
and people
Developing, engaging
and remunerating our people
Financial Capital
Network advantage
and digital solutions
are creating the supply
chains of the future
Economic
Value Retained3
US$1b
Economic
Value Generated
US$5.2b4
Economic
Value Distributed
US$4.2b5
1 Brambles’ renewable electricity result includes electricity from renewable electricity contracts, certified ‘Greenpower’ and Energy Attribute Certificates (EACs).
5 See page 18 for the breakdown of Economic Value Distributed.
2 The United Nations Sustainable Development Goals (SDGs) are a set of 17 interconnected goals that form a global benchmark for achieving a sustainable future for all. While many
of the SDGs intersect with Brambles’ operations, the SDG it assesses as most material to its operations is SDG 12 – Responsible Consumption and Production.
3 Group cash capital expenditure.
4 Group sales revenue.
10
Operating
Model
Brambles manages the world’s largest pool of reusable pallets, crates
and containers. Through its inherently sustainable operating model, superior
network advantage and industry expertise, Brambles leads the market in more
efficient and sustainable supply chains.
Inherently Sustainable Operating
Model
Brambles’ ‘share and reuse’ model follows
the principles of the circular and sharing
economies, creating more efficient supply
chains by reducing operating costs
and demand on natural resources. By
promoting the ‘share and reuse’ of assets
among multiple parties in the supply
chain, Brambles offers customers a more
efficient and sustainable alternative to the
use of disposable single-use products or
managing their own proprietary platforms.
Network Advantage and Supply
Chain Expertise
Brambles’ sustainable operating model
is underpinned by its superior network
advantage and industry-leading supply
chain expertise, developed over 70 years of
managing customers’ supply chains around
the world. With operations in approximately
60 countries, Brambles’ network advantage
comprises the scale and density of its
service centre network and the strength
of its customer relationships in every
major market in which it operates. This
means Brambles can be faster and more
responsive, and in times of uncertainty
and increased volatility, more resilient and
more reliable.
Sustainability Strategy
Brambles’ sustainability strategy
organises the Group’s sustainability
activities and goals under three broad
programmes: Planet Positive; Business
Positive; and Communities Positive.
Brambles’ sustainability vision to pioneer
regenerative supply chains including its
2025 targets is outlined in more detail
on page 20.
To view the Group’s
Sustainability Strategy go to:
brambles.com/2025-sustainability-targets
PALLETS AND RPCs
Operating & Financial Review
11
Share and reuse: How it works
PALLETS AND RPCs
1
2
3
Brambles provides standardised pallets,
crates and containers to customers
from its service centres as and when
the customer requires.
Customers use this equipment and
Brambles’ support services to transport
goods through the supply chain.
Customers either arrange for the
equipment’s return to Brambles or transfer
it to another participant for reuse.
Using its network advantage and asset management expertise, Brambles seamlessly connects supply chain
participants, ensuring the efficient flow of goods through the supply chain. By reducing transport distances and the
number of platforms required to service the supply chain, Brambles delivers savings in which all participants share.
Brambles retains ownership of its equipment at all times, inspecting, cleaning and repairing, to maintain appropriate
quality levels.
Brambles generates sales revenue predominantly from rental and other service fees that customers pay based on
their use of its platforms and services.
12
Strategic
Priorities
Brambles is committed to being the global
leader in platform pooling and insight‑
based solutions to fast‑moving supply
chains delivered through its circular ‘share
and reuse’ model. Having introduced the
platform pooling model around the world,
Brambles is reinventing it for the supply
chains of tomorrow.
Brambles seeks to:
• Achieve and maintain the number one position in each region
of operation;
• Lead the industry in customer service, innovation and
sustainability; and
• Be an employer of choice through best-in-class safety, diversity
and talent development programmes.
To deliver this strategy, Brambles has identified four focus areas
which leverage the power of its circular ‘share and reuse’ model
to deliver value for customers, employees and shareholders.
These four focus areas are: Customer Value; Asset Efficiency
and Network Productivity; Digital Transformation; and
Business Excellence.
Customer Value
Brambles is committed to
delivering unrivalled value
and exceptional service to its
customers.
Brambles works with its manufacturing customers and
supply chain partners to enhance the reliability, efficiency
and sustainability of end-to-end supply chains. COVID-19 has
demonstrated how critical supply chains are to customers and
wider stakeholders. Brambles is committed to improving the
customer experience further through simpler processes, additional
services and enhanced platform quality.
Asset Efficiency and
Network Productivity
Brambles constantly seeks to
improve the productivity and
sustainability of its assets
and operations.
Brambles constantly seeks to improve the productivity and
sustainability of its assets and operations. Brambles works with
its customers and partners to align physical networks and working
practices in order to improve asset utilisation, reduce equipment
loss and lower equipment damage rates. Ongoing programmes of
automation and process standardisation enhance the efficiency
and resilience of Brambles’ operations, allowing the Group to
transfer best practices from one market to another.
Circular
‘Share and Reuse’
Model
Operating & Financial Review
13
Impact of COVID-19
Brambles’ strategy is focused on delivering returns well in excess
of the cost of capital over a sustained period. The COVID-19
pandemic has created significant uncertainty over the past
18 months. Brambles is proud of the role that its people and
services have played during the pandemic, working closely with
customers and partners to keep goods flowing through supply
chains. The core elements of Brambles’ strategy have proven
robust in an unprecedented period, which has demonstrated the
value of efficient and resilient supply chains.
Accelerating Shaping Our Future
Brambles has recently undertaken a focused business planning
process to accelerate the Shaping Our Future programme and
invested to deliver transformative outcomes in each of the
focus areas discussed below. Further information on Brambles’
refreshed strategic ambition and priorities will be provided at the
Investor Day in September 2021.
Circular
‘Share and Reuse’
Model
Digital Transformation
Brambles is investing to
transform information and
digital insights into new
sources of value for itself and
for its customers.
Brambles sees data and technology as core strengths
and sources of future competitive advantage. The
Group’s Digital and Data team brings together its in-house
technology hub, BXB Digital, with business capabilities to translate
technology into business outcomes. Brambles’ goal is to combine
supply chain data, physical assets and domain expertise to create
distinctive new capabilities as well as supporting the delivery
of the other strategic themes.
Business Excellence
Brambles is reinventing its
organisation, technology and
processes to be simpler, more
effective and more efficient.
The Group is committed to fostering a culture of agility,
innovation and continuous improvement, underpinned by the
required processes and systems. Successfully attracting,
retaining and empowering high calibre people is integral to
Brambles’ ongoing success and will become increasingly
important as new skills are required in areas such as digital
services, advanced analytics and automated supply chains.
14
Customer Value
Proposition
Brambles’ pallets and containers form the invisible backbone of the global
supply chain. This gives Brambles key insights that help customers meet
evolving consumer demands while minimising their environmental impact
and improving the safety and efficiency of their supply chains.
With a comprehensive suite of supply chain solutions, Brambles provides its customers with operational,
financial and environmental efficiencies not otherwise available through the use of single-use disposable
alternatives and proprietary models.
Supply Chain Solutions
Brambles is integral to its customers’ supply chains, working
closely with all participants including manufacturers, producers,
growers and retailers. With end-to-end involvement, Brambles has
clear insights into what impacts the safe, efficient, reliable and
sustainable operation of global supply chains.
By leveraging these insights and its unmatched expertise,
Brambles offers customers comprehensive solutions that
improve the performance of the supply chain. This helps address
the challenges associated with the increasing complexity, rapid
evolution and, at times, uncertainty of modern supply chains.
Platform Solutions
Brambles offers customers the widest range of supply chain
platforms including: pallets (timber and plastic); Reusable Plastic
Crates (RPCs); bins; and specialised containers.
By eliminating the need for customers to purchase and manage
their own platforms, Brambles reduces the capital requirements
and complexity of customers’ operations while simultaneously
reducing waste throughout their supply chains.
System-Wide Solutions
Brambles conducts in-depth studies of customers’ supply
chains to map the flow of goods, information and platforms
to identify the causes of network inefficiencies and
product damage.
By determining the optimal mix of platforms and processes
for customers’ individual supply chains, Brambles can
mitigate network inefficiencies and ensure the safe and
sustainable transportation of goods through the supply chain.
Transportation Solutions
Brambles’ superior network scale provides a unique capability
to coordinate collaboration between multiple supply chain
participants to deliver transport efficiencies. This includes
matching and eliminating empty transport lanes, sharing
transport and contracting transport for and from customers.
Retail Store Solutions
Brambles works closely with its customers to develop retail store
solution strategies and consumer-facing platforms that improve
the efficiency of the shared supply chain by increasing sales
at lower costs to the supplier, retailer and consumer.
These merchandising and fulfilment solutions, which include
full size and fractional display pallets, trays and RPCs, effectively
improve safety, and reduce the time, labour and activity required
to move goods from the point of production to the point of sale.
Manufacturing, Warehouse and Distribution
Centre Solutions
Using its experience in managing platforms, optimising
automated facilities and packaging performance testing,
Brambles has developed solutions that improve the overall
performance and efficiency of customers’ facilities.
These solutions include: customising customers’ platform
processes; optimising how customers configure, build and
protect product loads; and providing higher quality platforms
and engineering services to improve the performance of
automated facilities.
Sustainability Solutions
Brambles’ leadership in sustainable sourcing of materials and
strong governance controls reduce risk and provide customers
with confidence in their supply chain partnership.
Brambles creates value for customers by providing a sustainable
alternative to single-use disposable packaging, saving customers
money and significantly reducing the environmental impact of
their operations.
Brambles’ network resilience and its resource efficient, low-carbon
solutions mean it has an important role in helping customers
manage through supply chain disruptions while transitioning to
a low-carbon economy.
Operating & Financial Review
15
Brambles’ Zero Waste World (ZWW) programme reinforces its commitment to
collaborate with customers and create smarter and more sustainable supply chains
– creating more value by using less and regenerating more resources. Brambles
currently has 250 leading companies participating in its ZWW programme.
Through ZWW, Brambles seeks to use its unique position in the supply chain to help customers address three key
industry challenges:
Eliminating waste
by using its circular economy
expertise to convert customers to
more sustainable ‘share and reuse’
solutions which save resources and
reduce costs.
Eradicating empty
transport miles
by using its network scale with
density and expertise to facilitate
collaborative transport solutions,
bringing manufacturers and
retailers together to reduce the
environmental impact of their
operations and save money.
Reducing inefficiencies
by using its end-to-end supply
chain solutions and BXB Digital
technology to enhance customers’
visibility of their supply chains so
they can make better decisions.
16
Investor Value
Proposition
Brambles generates value through a circular ‘share and reuse’ model that leverages
its scale, density and expertise to achieve superior operational efficiencies.
These efficiencies in turn generate cash flow that can either be returned to
shareholders or reinvested in the business to fund growth, innovation and the
development of its people to build a more resilient business.
Scale-related
operational
efficiencies
First mover
advantage
Shareholders
Network scale, density
and expertise
Cash flow
generation
Reinvest in growth,
innovation and people
Operating & Financial Review
17
Dividend Policy and Payment
Brambles’ dividend policy is to target a
payout ratio of 45-60% of Underlying Profit
after finance costs and tax, subject to
Brambles’ cash requirements, with the
dividend per share declared in US cents and
converted and paid in Australian cents.
This year, the Board declared total
dividends of 20.5 US cents per share with
the Australian dollar payment equivalent
to 27.32 AU cents per share. This results
in a payout ratio for the Year of 54%, which
is broadly in line with the prior year’s
payout ratio. FY20 total dividends were
18.0 US cents per share or equivalent to
25.92 AU cents per share.
The final dividend for 2021 of 10.5 US cents
per share is a 5% increase on the 2021
interim dividend of 10 US cents per share,
and will be 30% franked. This dividend
is payable in Australian dollars at
14.24 AU cents per share and will be
paid on 14 October 2021 to shareholders
on the Brambles register at 5.00pm on
9 September 2021. The ex-dividend date
is 8 September 2021.
Capital Management
Programme
At the time of the sale of its IFCO RPC
business, Brambles announced that
it intended to use the US$2.4 billion
net proceeds to fund a A$2.8 billion
(US$1.95 billion) capital management
programme, through an on-market share
buy-back of up to A$2.4 billion
(US$1.65 billion) and a pro-rata return of
cash of 29.0 AU cents per share, and to
pay down debt.
The on-market share buy-back
commenced on 4 June 2019 and to date
158.2 million ordinary shares have been
bought back and cancelled for a total
consideration of A$1,751.7 million.
On 22 October 2019 Brambles paid a
29.0 AU cents per share pro-rata cash
return comprising two components: a
capital return of 12.0 AU cents per share
and a special unfranked dividend of
17.0 AU cents per share. The total cash
payment for the pro-rata return was
A$453.8 million.
At 30 June 2021, Brambles had
completed A$2.2 billion, that is 78% of
the A$2.8 billion capital management
programme.
Dividend Reinvestment Plan
Given the on-market share buy-back
programme will continue into FY22, the
Board has decided to continue to suspend
the Dividend Reinvestment Plan.
Long-Term Value Creation
and Sustainable Shareholder
Returns
Brambles shares the efficiencies generated
by its scale, density and expertise with its
customers, providing a compelling value
proposition compared to alternatives. By
providing customers with supply chain
solutions in approximately 60 countries,
Brambles offers shareholders exposure
to invest in a low-carbon circular business
model, with geographically diversified
earnings streams, primarily from the global
consumer staples sector.
The supply chains served by Brambles
also provide a broad range of growth
opportunities including: increasing
penetration of core equipment-pooling
products and services in existing markets;
diversifying the range of products and
services; exploring the digitisation
of supply chains; and providing a
resilient foundation during supply
chain uncertainties.
Within this context, Brambles is committed
to striking the right balance between
growing its business and delivering
sustainable shareholder returns over the
long-term. By focusing on its core drivers
of value, Brambles expects to deliver:
Sustainable growth at returns well in
excess of the cost of capital
• Sales revenue growth6 in the
mid-single digits;
• Underlying Profit growth6 in excess of
sales revenue growth through
the cycle; and
• Strong Return on Capital Invested.
Cash generation to fund growth,
innovation and shareholder returns
• Free Cash Flow sufficient to fully fund
capital expenditure and dividends.
6 At constant currency.
18
The Broader Benefits
of Brambles
Brambles’ circular business model and ambition to
Pioneer Regenerative Supply Chains provides investors with an opportunity to
participate in creating positive outcomes for economies, communities, and
the environment.
Economic Value
Retained7
US$1b
Economic
Value Generated
US$5.2b8
Additional
Value Distributed
US$0.5b
$0.5b Share buy-back
Economic
Value Distributed
US$4.2b
$0.3b Dividends paid
to shareholders
$0.8b Employee costs
including taxes
$0.2b Income taxes paid
$0.1b Interest paid on loans
$2.8b Payments to suppliers
7 Group cash capital expenditure.
8 Group sales revenue.
Operating & Financial Review
19
Shaping Brambles’
Future through Models of
Sustainable Development
Brambles’ procurement team has developed
an innovative sustainable sourcing model,
which creates a dependable pipeline
of sustainably certified raw materials,
particularly timber, while reforesting
degraded land. Importantly, communities are
at the centre of this initiative, creating socio-
economic opportunities for marginalised
groups. These projects are in their infancy,
however partnerships are in place with
communities, investors, authorities and
relevant independent third parties that
will ensure the project delivers much-
needed economic empowerment. Critically,
the initiative will maintain sustainable
certification for materials, regenerate forests,
enhance biodiversity values and provide full
transparency concerning human rights.
Preserving and Enhancing
Capital on which it Depends
Through its regenerative strategy, Brambles
seeks to reduce the business negative
impacts and create positive outcomes
for economies, communities and the
environment at local, regional and national
scales. This section outlines the direct
and the indirect benefits, which affirm its
purpose, its role in the broader sustainable
economic transition and its social licence
to operate.
Generating and Redistributing
Financial Capital
Strong financial performance provides
direct value for Brambles’ employees, their
families, and communities. This includes
economic benefits such as dependable
employment opportunities, wages and
associated non-financial benefits for
~12,000 employees in approximately
60 countries. Furthermore, payments to
local suppliers generate ongoing economic
demand, subsequently supporting local
employment and economies. Financial
donations to community groups and
taxes to governments help redistribute
prosperity and create a fairer society. More
information on how Brambles manages its
tax obligations and the tax contributions
it makes to the countries in which it
operates can be found in Brambles 2021
Tax Transparency Report, available in
September 2021.
Translating Sustainability
Concepts into Business
Strategies
Brambles’ advocacy on the benefits of
a circular economy has helped translate
this challenging concept into a practical
business strategy, demonstrating the
financial viability of a truly circular
business model on a global scale. Through
this leading example, Brambles and its
partners provide a pathway for other
industries and sectors to examine and
adopt circular strategies relevant for their
context. Pioneering regenerative supply
chains is Brambles’ next big ambition,
and its initial progress on its 2025 targets
is encouraging. By setting its course
toward regeneration and sharing its
experiences, Brambles hopes to inspire
other organisations to join the regenerative
revolution, accelerate action on the
UN Sustainable Development Goals (SDGs)
and in doing so, redefine prosperity for the
post-pandemic world.
Setting an ESG Benchmark for
the ‘Green’ Recovery
Brambles’ strategic priorities and
2025 sustainability targets merge its
financially material transformation
initiatives with its three big ESG themes
of climate, circularity, and the sustainable
use of the world’s forests into an integrated
value creation strategy. More than at any
other time, Brambes’ circular model is
demonstrating its essential role in everyday
life, and its resilience in the context of
external pressures. Brambles is poised
to leverage this advantage and share its
approach with peers, industry associations
and educators as part of a broader
coalition working in collaboration during
the UN SDGs decade of delivery.
20
Brambles’ 2025
Sustainability Targets
Building on its global leadership position in sustainability, Brambles announced its
ambitious 2025 sustainability vision to Pioneer Regenerative Supply Chains in FY21.
Planet Positive
Our commitment is to be nature positive
by restoring forests, going beyond zero
waste, and drawing down more carbon
than we produce, ultimately becoming
a regenerative, nature-positive business.
Forest Positive
SDG
15
SDG
8
SDG
13
Brambles will sustainably grow two trees for every tree we use. One tree through
our certification programme and one additional tree for the planet. We will ensure
100% sustainable sourcing of timber indefinitely, and enable the transformation of
more forestry markets to Chain of Custody (CoC) certification.
2021 PROGRESS
Brambles maintained 100% sustainable sourcing and increased our CoC to 68.6%.
Business Positive
Brambles will pioneer regenerative
supply chains by improving our
circular model every year, increasing
the environmental benefits in our
customers’ supply chains.
Supply Chain Positive
SDG
12
SDG
13
SDG
9
Continuous increases in environmental benefits in our customers’ supply chains through
our ‘share and reuse’ model.
Co-develop and improve our performance in leading circular measurement tools for
industry.
2021 PROGRESS
Increased our environment impact by:
2.4m tonnes of CO2;
3,160 megalitres of water;
3.1m cubic metres of wood;
3.2m trees; and
1.4m tonnes of waste.
Participated in development of leading
circular measurement tools from
Ellen MacArthur Foundation (achieved A-)
and WBCSDs CT+ Tool.
Food Positive
SDG
2
Collaborate with food banks to serve rescued food to 10 million people. Volunteering,
in-kind donations, skills and expertise sharing and financial donations will be the
catalysts for this target.
Communities Positive
Brambles’ Communities Positive
programme will build resilience,
promote circularity and account
for the connections between
society, the economy and nature.
Operating & Financial Review
21
Regeneration is about delivering life’s essentials every day, but in a
nature and people positive way. Reuse, resilience and regeneration
are at the core of this vision and are embedded in Brambles’
2025 sustainability targets.
Brambles has delivered meaningful progress in the foundational
year of its regenerative journey whilst developing the plans, key
milestones and measurement systems to monitor and share
its progress. Collaborating on innovative projects with strategic
partners, including customers, suppliers, sustainability thought
leaders and solution specialists is an essential part of Brambles’
integrated approach to addressing the shared sustainability
challenges of our time.
Importantly, Brambles has produced tangible results,
demonstrating that an ambitious regenerative vision has
immediate and practical outcomes. This will motivate its teams
to strive for continued success in each target area. For example,
Brambles has made important investments in afforestation
projects that will grow the world’s forest reserves and secure
sustainably certified timber for its business. Brambles’ people
have also spoken, helping to rank Brambles as the top employer
in 17 countries and four regions. Some of Brambles’ highlights
for year one against its 2025 targets are shown below. All results
will be published in full in Brambles’ Sustainability Review in
September 2021.
Performance against Brambles’ 2025 targets has been assured.
Climate Positive
SDG
13
SDG
7
Waste Positive
SDG
12
SDG
6
Brambles commits to a 1.5ºC climate future including a
Paris Agreement aligned carbon emissions
Science-Based Target (SBT) for our supply chain.
100% of our electricity will be renewable and all our operations
will be carbon neutral by 2025.
2021 PROGRESS
Brambles achieved carbon neutrality for our operations
(Scope 1 and 2 emission sources) and 100% of our electricity
was from renewable sources9.
Brambles commits to:
• Zero product materials sent to landfills, for all Brambles’
and subcontracted locations;
• Innovate closed loop products: aspire to use 30% recycled or
upcycled plastic waste;
• 100% of Brambles’ locations including offices and service centres
to be zero waste; and
• Water positive: optimise all water use including reclaiming,
recycling, replenishment and treatment.
2021 PROGRESS
Brambles deployed our first regenerative platform, the
QT Wheeled Dolly, made from 100% post-consumer recycled content.
Positive Collaboration
SDG
17
Workplace Positive
SDG
3
SDG
5
SDG
10
SDG
16
Brambles will expand our customer collaborations in all regions
through our Zero Waste World initiative, doubling the number from
250 to 500.
Brambles commits to:
• A 25% reduction in BIFR and to develop a wellbeing-at-work
programme;
• At least 40% of management roles held by women and double the
number of women in our plants;
• Top 20% for inclusivity and launch an accessibility programme
in each region; and
• Lead on anti-corruption and human rights, including modern day
slavery.
2021 PROGRESS
• In FY21, Brambles met its year-on-year improvement target,
recording a BIFR performance of 5.0, which represents
a 30% decrease in BIFR for the five-year period ending June 2021.
• Brambles’ Modern Slavery Statement published in March 2021.
• ‘Top employer accreditation’ achieved in 17 countries and
four regions.
• Brambles’ achieved 32% of women in management roles.
Circular Economy Transformation
SDG
4
SDG
12
Positive Impacts for People and Our Planet
Brambles will advocate, educate and impact one million people
to become circular economy change makers.
Brambles commits to developing natural and social capital
accounting approaches to transparently measure and validate
our performance against all 2025 targets and confirm progress
towards our regenerative status.
Direct Impact
9 Brambles’ renewable electricity result includes electricity from renewable electricity contracts, certified ‘Green Power’ and Energy ‘Attribute Certificates’ (EACs).
22
Brambles’ Climate
Change Strategy
Brambles has embraced
the low‑carbon transition,
leveraging its circular
‘share and reuse’ model to
decarbonise its own and
customers’ supply chains.
Brambles’ Carbon Profile by spend
category covering Scope 1, 2 and 3
Scope 1
Scope 2
Scope 1
Scope 3
Onsite Fuel + Fleet Fuel 2%
Scope 2
Electricity 2%
Scope 3
Logistics Truck 49%
New Pallets 15%
Outsourced Service Centres 13%
Timber Boards & Blocks, Nails & Paint 7%
Goods & services 5%
Waste 3%
Industrial Machinery & Equipment 2%
Logistics Rail 2%
Other transport 1%
Business travel & Commuting 1%
Brambles’ Scope 3 emissions accounting
approach follows best practice and
meets the requirements outlined in the
Greenhouse Gas Protocol. Scope 3
emissions will be assured for Brambles’
Sustainability Review due for release
September 2021. The method takes a
hybrid approach based on economic
modelling using input/output analysis,
direct spend data matched to physical
purchases, e.g. metres cubed of wood, and
indirect spend data mapped to a detailed
multi-regional input/output database.
Brambles’ new sustainability targets strive
for a sustainable equilibrium between the
business’ requirement for natural resources
and nature’s ability to regenerate this value.
Beyond equilibrium is where additional
value is created and is the territory where
Brambles’ 2025 sustainability targets seek
to deliver more positive outcomes such as
accelerating the transition to a low-carbon,
circular economy.
During FY21, Brambles built upon its
2020 Task Force for Climate-related
Financial Disclosure (TCFD) by further
integrating the TCFD recommendations into
its governance, risk and strategy functions
and strategic business projects. Brambles’
finance function has also established links
from its accounting systems to Brambles’
carbon emissions SBT processes laying
the foundations for robust monitoring and
measurement of emissions performance
across its supply chain.
Climate-related impacts, including the
financial risks and opportunities of a
low-carbon economic transition, continue
to lead the narrative from governments,
customers, and investors in Brambles’
key regions of operation. This context
reinforces Brambles’ sustainable business
model and its newly adopted 2025 targets’
ambition to Pioneer Regenerative Supply
Chains as the appropriate strategy for its
stakeholders as they pursue business-
ready, sustainable solutions to their supply
chain challenges in an environment of
constant change.
The inherent low-carbon nature of
circular business models is increasingly
viewed as the complementary
measure to decarbonising the
world’s energy systems in line with
the 2015 Paris Climate Agreement
(‘Completing the Picture: How the Circular
Economy Tackles Climate Change’).
In essence, circular business models
design out waste and pollution, keeping
products and materials in use rather than
using them up, and regenerating the natural
systems they depend on.
FY21 TCFD Timeline
Q1
Q1
Q2
Q2
Q3
Q3
Q4
Q4
• 2025 sustainability
• Head of
• Detailed carbon
• Preparation for
strategy and targets
released
• Commitment to
1.5ºC climate future
announced during
‘Race to Zero’
campaign
Decarbonisation
role approved
to strategically
address emission
sources across the
business
emissions
analysis covering
Scopes 1, 2 and 3
in preparation for
SBT submission
SBT submission
• Sustainability review
with Brambles’
Board covering
climate issues
• Climate-related risks
reviewed by Audit &
Risk Committee
• Brambles’
Emerging Risks and
Opportunity process
defined including
medium to longer-
term climate-related
risks
Operating & Financial Review
23
Brambles’ FY20 TCFD outlined three climate-related themes that define its
response to addressing climate change and its role in accelerating the transition
to a low‑carbon, circular economy. Its progress throughout FY21, against these
themes, is provided below.
Brambles’ Low-Carbon
Advantage
The immediate and ongoing
opportunities related to Brambles’
low‑carbon, circular business model
outweigh short‑term climate‑related
risks in the decarbonising 1.5°C and
2°C climate scenarios.
The focus on ESG throughout FY21,
specifically climate issues, has never
been higher, and Brambles’ sustainability
leadership position has created more
collaboration opportunities with customers
and cultivated positive interactions with
its investors. For its customers, this has
led to practical environmental outcomes,
cutting carbon and waste from their
supply chains. For its investors, the
clear advantages of Brambles’ model as
well as its strategy to capitalise on the
accelerating decarbonisation plans driven
by governments and industry in Brambles’
key regions of operation has been better
understood. Brambles’ ZWW programme
increased its impact and expanded
into the Asia-Pacific region through the
CHEP Australia business.
Brambles also deployed its first
regenerative product made from
100% post-consumer recycled plastic,
demonstrating the tenacity of its
innovation teams to deliver platform
solutions that address multiple problems
for its customers.
As more governments, customers
and industry sectors adopt strategies
for an increasingly climate-conscious
marketplace, Brambles will continue to
educate, advocate, and lead on the virtues
of circular models to deliver business value
and address climate change while creating
more positive value for society.
Brambles’ Network Resilience
The agility and scale of Brambles’
network and asset pools create an
inherent resilience to supply chain
shock, enabling greater responsiveness
to customers before and after severe
climate‑related weather events.
The vital role of circular business models
is accentuated in times of scarcity, and the
continuation of elevated and unpredictable
levels of consumer demand in FY21
provided real-world stress testing of the
value Brambles brings to global supply
chains. Brambles’ service centre and
logistics teams have not only mitigated this
risk but redefined it as a climate-related
opportunity, uniquely characteristic of its
circular model and distributed network.
Brambles’ asset productivity measures
combined with continued investment in
automation have accelerated the efficiency
of the pallet repair process. Brambles’
well-established transport collaboration
programme delivered heightened value
in the face of cost inflation, which also
serves as an essential Scope 3 transport
emissions decarbonisation strategy.
Looking ahead, Brambles will continue to
integrate climate-related considerations
across its networks and the business
planning processes that underpin them.
FY22 will see a deeper assessment of
the resilience against potential physical
climate-related risks for key service
centres and related infrastructure, and
linking climate assessments to our
investment processes.
Raw Material Supply Security
and Continuity
Longer‑term climate‑related risks
relating to materials, specifically timber
for pallets, are considered in Brambles’
strategic planning processes. This
includes extensive mitigations already
underway as part of procurement,
supply chain and asset efficiency
programmes.
The challenges of the pandemic have
impacted global timber supply chains
as increased demand from housing
construction combined with capacity
constraints in timber mills impacted both
price and availability of raw materials.
Consequently, the effectiveness of
Brambles’ mitigation actions against
the medium- to longer-term materials
supply risks were tested as wood supply
became constrained. Brambles’ steadfast
commitment to sustainable sourcing of
timber has safeguarded our businesses
from uncertified materials in forest
product markets while improving our
suppliers’ efficiencies and costs. Strategic
procurement programmes, including more
Forest Stewardship Council certified forest
acquisitions in South Africa, leveraging
our scale for price, and developing new
sources of materials, helped create a
reliable pathway for ongoing sustainable
materials supply and security. Furthermore,
our partnerships with critical tier-one
suppliers have delivered a step-change in
sawmill yield, maximising the outputs of
our increasingly valuable materials. As a
carbon neutral business, Brambles closely
monitors carbon offset markets and
the role of carbon offsetting in potential
government policies.
24
Brambles’ Climate Change Strategy continued
Brambles is a carbon neutral
operations company
Risk Management
Climate change and carbon emissions
risks are fully integrated into Brambles’
Risk Management process and regularly
reviewed as part of the Sustainability,
Risk and Compliance Committee and
the Audit & Risk Committee processes.
In FY21, Brambles also developed
its process for managing emerging
risks and opportunities, which aims to
articulate the issues driving the most
relevant potential future scenarios for
its business. The climate-related risks
concerning carbon pricing for transport
fuels and the opportunities regarding
transport collaboration were assessed in
this process.
Strategy
Climate considerations continue to
be integrated into Brambles’ strategic
processes. As the market for low-carbon
and circular solutions accelerates, this
approach will leverage the advantages
of Brambles’ sustainable model and also
factor in climate impacts from its regional
business investment activity.
Finance
Brambles’ finance function has updated
Brambles’ financial statement to increase
climate disclosure in relevant categories.
This will foster best practice transparency
as its business continues to understand
and integrate climate considerations.
Brambles’ Progress on Climate
Brambles made solid progress in the first
year of its regenerative strategy. Brambles’
Climate Positive and Forest Positive
programmes aim to decarbonise its own
operations and the carbon emissions
within its supply chain. Brambles’
Business Positive targets are designed to
cut carbon and waste from its customers’
supply chains.
In October 2020, as part of the
‘Race to Zero’ campaign, Brambles
announced its commitment to contribute
to global efforts to limit global heating to
1.5ºC above pre-industrial levels. This is
the highest level of climate ambition and
is supported by a commitment to align
its carbon targets to the SBT initiative,
including addressing its suppliers’
emissions. Brambles’ total emissions
across Scope 1, 2 and 3 sources are
visualised on page 22, which illustrates
that 95% of our emissions are embodied
in goods and services purchased from
our suppliers. Action on its operational
emissions includes a commitment to
source 100% of its electricity from certified
renewable sources by 2025 and becoming
carbon neutral across its Scope 1 and 2
emissions, which was achieved in 2021.
Governance
Climate issues, including the risks and
opportunities for Brambles under different
climate scenarios, are part of Brambles’
Audit & Risk Committee and the Brambles
Board agenda. The focus of discussions
included assessing emission sources in
Brambles’ supply chain and the new Head
of Decarbonisation role within its supply
chain function, tasked with developing a
decarbonisation plan in FY22.
Brambles’ TCFD disclosures
available at:
brambles.com/tcfd
Operating & Financial Review
25
Financial Position and Financial Risk Management
Capital Structure
Brambles manages its capital structure to maintain a solid
investment grade credit rating. During FY21, Brambles held
investment grade credit ratings of BBB+ from Standard & Poor’s
and Baa1 from Moody’s Investors Service.
In determining its capital structure, Brambles considers
the robustness of future cash flows, the potential funding
requirements of its existing business, growth opportunities
and acquisitions, the cost of capital, and ease of access
to funding sources.
Initiatives available to Brambles to achieve its desired capital
structure include: adjusting the amount of dividends paid to
shareholders; returning capital to shareholders; buying back
share capital; issuing new shares; selling assets to reduce
debt; varying the maturity profile of borrowings; and managing
discretionary expenses.
On 31 May 2019, Brambles divested its IFCO RPC business,
generating net cash proceeds of US$2.4 billion and implemented
a A$2.8 billion (US$1.95 billion) capital management
programme. During the course of FY21, Brambles repurchased
66.5 million shares for a total consideration of A$702.0 million
(US$523.1 million). The Capital Management Programme
section on page 17 further outlines the progress of the capital
management programme.
Treasury Policies
Key treasury activities include: liquidity management; interest
rate and foreign exchange risk management; and securing
access to short- and long-term sources of debt finance at
competitive rates. These activities are conducted on a centralised
basis in accordance with Board policies and guidelines, through
standard operating procedures and delegated authorities.
These policies provide the framework for the treasury function to
arrange and implement lines of credit from financiers, select and
deal in approved financial derivatives for hedging purposes, and
generally execute Brambles’ financing strategy.
The Group uses standard financial derivatives to manage
financial exposures in the normal course of business. It does
not use derivatives for speculative purposes and only transacts
derivatives with relationship banks. Individual credit limits are
assigned to those relationship banks, thereby limiting exposure
to credit-related losses in the event of non-performance by
any counterparty.
Funding and Liquidity
Brambles generally sources borrowings from relationship banks
and debt capital market investors on a medium- to long-term
basis. Bank borrowing facilities were either maintained or renewed
throughout the Year. These facilities are generally structured
on a multi-currency, revolving basis with maturities ranging to
2026. Borrowings under the facilities are floating-rate, unsecured
obligations with covenants and undertakings typical for these
types of arrangements.
Borrowings are also raised from debt capital markets by the issue
of unsecured fixed interest notes, with interest paid either annually
or semi-annually. At balance sheet date, loan notes on issue
totalled US$1,690 million and had maturities out to October 2027.
As at 30 June 2021, Brambles held $0.4 billion in cash and
cash equivalents, being operating cash and the balance of cash
held from the net proceeds from the sale of IFCO, reduced by
the capital management and debt reduction transactions over
FY20 and FY21.
Maturity Profile of Committed Borrowing Facilities and
Outstanding Bonds (% of total committed credit facilities)
US$b
1.25
1.0
0.75
0.5
0.25
0%
0
29%
28%
17%
19%
7%
< 1 yr
1-2 yrs 2-3 yrs 3-4 yrs 4-5 yrs
> 5 yrs
Bonds/notes
Bank borrowings
Undrawn bank facilities
As at 30 June 2021, Brambles’ total committed credit facilities
were US$3.1 billion. The average term to maturity of Brambles’
committed credit facilities as at 30 June 2021 was 3.7 years
(2020: 4.2 years).
In addition to these facilities, Brambles has entered into leases
for office and operational locations and certain plant and
equipment to achieve flexibility in the use of its assets. As at
30 June 2021, Brambles’ total lease liabilities were US$0.7 billion.
The rental periods vary according to business requirements.
Net Debt and Key Ratios
US$m
June 2021
June 2020
Change
Current borrowings
Current lease liabilities
32.4
147.5
36.3
112.8
(3.9)
34.7
Non-current borrowings
1,718.1
1,777.2
(59.1)
Non-current lease liabilities
565.1
591.4
(26.3)
Gross debt
2,463.1
2,517.7
(54.6)
Less: cash and cash equivalents
(408.5)
(737.3)
328.8
Less: term deposits
Net debt
Key ratios10
Net debt to EBITDA
EBITDA interest cover
-
(68.6)
68.6
2,054.6
1,711.8
342.8
FY21
1.18x
20.4x
FY20
1.10x
19.3x
Brambles’ financial policy is to target a net debt to EBITDA ratio
of less than 2.0 times.
The ratios remain well within the financial covenants included
in Brambles’ major financing agreements.
10 Brambles defines EBITDA as Underlying Profit adding back depreciation, amortisation and Irrecoverable Pooling Equipment Provision (IPEP) expense.
26
Key Performance Drivers and Metrics (Continuing operations11)
Brambles monitors its performance and value creation through a number of
financial and non-financial metrics. These include:
Sales Revenue
Key Drivers
• Like-for-like volume growth in line with economic/industry trends
• Expansion with net new wins and growth with existing customers
• Movements in pricing (including indexation) and changes in mix (product/customer/region)
• FY18 to FY21 includes the impact of accounting standard AASB 15 Revenue from Contracts with Customers
5-Year Performance
Sales revenue of US$5,209.8 million in FY21, reflected a compound annual growth rate (CAGR12) over the five years to FY21 of 6% at
fixed 30 June 2020 FX rates. Growth reflects continued expansion with both new and existing customers, new market entry, expansion
of the core product offering and price realisation in both mature and emerging markets in response to increased inflation and a higher
cost-to-serve. FY20 and FY21 growth includes the impact of COVID-19 on trading conditions, including elevated pallet demand levels, in
the fourth quarter of FY20 and continuing into FY21, to support the sustained increase of at-home consumption in developed markets.
Volume growth in the automotive businesses returned in FY21 following the impact of COVID-19 shutdowns in the fourth quarter of the
prior year.
Refer to page 136 for the detailed five-year financial performance summary on a reported basis at actual FX rates.
Underlying Profit
Key Drivers
• Transport, logistics and asset management costs (including external factors such as third-party logistics and fuel prices)
• Plant operating costs in relation to management of service centre networks and the inspection, cleaning and repair of assets (including
labour costs and raw material costs, predominantly lumber)
• Contribution from returns on investments in automation and supply chain initiatives
• Income from asset and site compensations and surcharge income largely related to lumber, fuel, and transport cost inflation
• Other operational expenses (primarily overheads such as selling, general and administrative expenses)
• Depreciation as well as provisioning for irrecoverable pooling equipment
• FY18 to FY21 includes the impact of accounting standard AASB 15 Revenue from Contracts with Customers
• FY20 and FY21 include ~US$24 million benefit per year from new accounting standard AASB 16 Leases
5-Year Performance
Underlying Profit of US$879.3 million in FY21, reflected a CAGR12 over the five years to FY21 of 1% at fixed 30 June 2020 FX rates. While
sales growth was a strong contributor to profit growth, Underlying Profit growth was below the rate of sales growth due to continued
direct cost pressures in the business, including high inflationary pressures, higher asset charges and increased investment across the
business to support growth, network efficiencies and improved commercial outcomes. These cost pressures are offset in part through
pricing actions, the surcharge mechanisms and benefits from efficiency and quality programmes, particularly the US Automation
programme with benefits progressively delivered from FY20 to FY22.
FY21 Underlying Profit growth of 8% at constant FX, a material uplift relative to the five-year CAGR12, reflecting sales leverage and
delivering a 1pt margin improvement over prior year. The FY21 contributions from price and volume growth, with incremental
contributions from the North American lumber surcharge and supply chain efficiencies, more than offset higher operating costs.
Refer to page 136 for the detailed five-year financial performance summary on a reported basis at actual FX rates.
Safety
Brambles’ Zero Harm Charter states that everyone has the right to be safe at work and to
return home as healthy as they started the day.
5-Year Performance
Brambles measures its safety performance through the Brambles Injury Frequency Rate
(BIFR), which consists of work-related incidents resulting in fatalities, lost time, modified
duty or medical treatment per million hours worked.
7.1
5.0
5.9
5.5
5.0
In FY21, Brambles met its year-on-year improvement target, recording a BIFR
performance of 5.0, representing a 30% decrease in BIFR for the five-year period ending
June 2021. Brambles remains committed to its vision of Zero Harm and this year is
launching a new Safety First strategy as the key enabler for reducing residual risks across
its operations. Brambles’ Zero Harm Charter and safety targets align with
SDG 3: Good Health and Wellbeing.
11 Continuing operations excludes IFCO and Kegstar in all years.
12 CAGR has been calculated on a like-for-like basis, excluding the impact of accounting policy changes.
FY17
FY18
FY19
FY20
FY21
10.3
7.1
FY16
FY17
FY18
FY19
FY20
Safety
5.0
5.9
5.5
Sustainability - Material sourcing
97.3
99.1
99.4
99.7
100
67
62
63
56
48
FY16
FY17
FY18
FY19
FY20
% of certified sources
% of Chain of Custody
99.1
99.4
99.7
100
100
67
62
63
68.6
56
FY17
FY18
FY19
FY20
FY21
% of certified sources
% of Chain of Custody
Operating & Financial Review
27
Cash Flow from Operations
Key Drivers
• Profitability
• Capital expenditure
• Asset compensations
• Movements in working capital
• FY20 and FY21 include the impact of new accounting standard AASB 16 Leases
5-Year Performance
The five years to FY21 were a period of solid overall EBITDA growth, supported by significant investment in capital expenditure to
support growth, as well as improved working capital management and increased collections of asset compensations. The improved
FY18 performance included strong working capital management initiatives and US$150 million cash inflow related to the repayment
of the HFG joint venture shareholder loan. FY19 included increased capital investment to support strong top line growth and to deliver
on a number of efficiency programmes. FY20 Cash Flow from Operations included benefits from asset efficiency and procurement
programmes, as well as favourable working capital movements.
FY21 Cash Flow from Operations included US$180m of timing benefits from the deferral of pallet purchases to FY22 due to pallet
availability constraints and also included benefits relating to improvements in capex creditors and one-off compensations largely relating
to the mandatory relocation of a service centre in the Asia-Pacific region.
Refer to page 136 for the detailed five-year financial performance summary on a reported basis at actual FX rates.
Return on Capital Invested (ROCI)
Key Drivers
• Underlying Profit performance
• Capital expenditure on pooling equipment to support growth in the business, which is primarily dependent on the rate of sales growth.
Brambles’ main capital cost exposures are raw materials, primarily wood, with material inflation in FY21 impacting pallet prices the
prior year
• Asset control factors, i.e. the amount of pooling equipment not recoverable or repairable each year (and therefore requiring
99.7
replacement) as well as damage rate impacting repair costs
99.4
97.3
99.1
100
• Recovery of compensations for lost assets funding / part funding replacements
• Asset velocity or frequency with which customers return or exchange pooling equipment
• FY18 to FY21 includes the impact of accounting standard AASB 15 Revenue from Contracts with Customers
• FY20 and FY21 includes the impact of new accounting standard AASB 16 Leases, which reduced FY20 ROCI by 1.5pts
67
56
48
62
63
5-Year Performance
The trend in Brambles’ ROCI metric over the five-year period reflects the Underlying Profit performance and increased Average
Capital Invested, largely to support growth and supply chain efficiency initiatives including the US accelerated automation and lumber
procurement programmes. Lumber inflation on pooling capex had a considerable impact on Average Capital Invested in FY21 which we
expect to continue into FY22.
FY16
FY17
FY18
FY19
FY20
Over the past five years, Brambles has delivered ROCI well in excess of the cost of capital, despite increased investments to support
growth and efficiency initiatives. FY17 reported Group ROCI of 17%, includes the IFCO business, which was divested in May 2018.
Reported ROCI in FY18 and FY19 of 20% and 19% respectively, excludes the IFCO business and AASB 16 introduced in July 2019.
FY20 reported ROCI of 17%, including the impact of the AASB 16, which reduced reported ROCI by 1.5 points.
% of certified sources
% of Chain of Custody
FY21 ROCI increased by ~1 point on a like-for-like basis to 18% reflecting improved profitability.
Refer to page 136 for the detailed five-year financial performance summary on a reported basis at actual FX rates.
Material Sourcing
Brambles’ longer-term procurement strategy combined with short-term targeted
actions were instrumental in navigating lumber supply challenges during the Year while
maintaining 100% certified sustainable sourcing for all timber materials and increasing
the quantity of Chain of Custody certified materials to 68.6%.
During the Year, Brambles’ procurement team focused on increasing collaboration
between regions, accelerating projects to address challenges in one region with
opportunities from another.
Sustainability - Material sourcing
Importantly, Brambles leveraged its position as a global customer for the diverse
supplier network to ensure the security of sustainably certified raw material supply and
security continuity.
99.1
99.4
99.7
100
100
67
62
63
68.6
56
FY17
FY18
FY19
FY20
FY21
% of certified sources
% of Chain of Custody
7.1
5.0
5.9
5.5
5.0
FY17
FY18
FY19
FY20
FY21
10.3
7.1
Safety
5.0
5.9
5.5
FY16
FY17
FY18
FY19
FY20
28
Material
Risks
Brambles is exposed to a range of strategic, operational, compliance and financial
related risks associated with operating in over 60 countries. Brambles’ risk
management framework incorporates effective risk management into its strategic
planning processes and requires business operating plans to effectively manage
key risks. The key risks to Brambles’ ability to achieve its strategic, financial and
sustainability objectives (in no order of significance), and respective mitigating
actions, including its response to the COVID‑19 pandemic are:
Risk
Implication
Mitigating Actions
Macro-
economic
conditions
including,
for FY21
and FY22,
economic
uncertainty
arising from
the COVID-19
pandemic
Macro-economic conditions, or economic
conditions affecting the supply chain or
industries in which Brambles’ customers operate,
may affect demand for Brambles’ services and/
or its financial performance. In addition, the
impact of the COVID-19 pandemic on global and
regional economic conditions could also affect
the operations of its customers or demand for
their products, which in turn, could affect the
demand for Brambles’ services. The pandemic
is largely responsible for the unprecedented
increase in demand for timber in the US and
China in 2H FY21, precipitating supply shortages
and hyperinflationary increases in timber prices
in the US and LATAM. Similar inflationary trends
are emerging in Europe. In addition, significant
pressure remains on freight availability and
costs in the US
Industry
trends in the
retail, grocery
and consumer
goods supply
chains
Industry trends (e.g. fragmentation of the retail
supply chain, rapid acceleration of e-commerce
and growth in hard discounters, demand for
different pooling equipment materials or
designs) could affect demand for Brambles’
current service offerings, the value of its existing
assets, and/or its financial performance
• The range of actions implemented in response to the
COVID-19 pandemic continue to enable Brambles to operate
and respond to potential changes in the economic and
business environment arising from the pandemic. Details of
specific actions are described in various places in this table
• Continued focus on driving growth through investment
in expanded customer value proposition, targeted
diversification in opportunities with attractive long-term
characteristics and the expansion of plant automation
projects across the Group
• Adoption of pricing and cost-recovery strategies to mitigate
the impact of cost inflation, with enhanced focus on cash
generation (e.g. contracted surcharge mechanisms and
exceptional price increases are used to recover inflationary
cost increases)
• Scenario-based strategic planning covering different
scenarios, including identifying actions to further de-risk and
exploit opportunities
• Ongoing programmes to:
• Drive customer intimacy throughout the supply chain and
uncover opportunities to leverage the Group’s unique global
scale and value proposition
• Create new products and service lines to meet
customers’ requirements
• Drive innovation to identify and respond to emerging trends
in platforms, materials sciences, new technologies and
sustainability practices
Maintaining
the quality
of pooled
equipment
in line with
customer
needs
A failure to maintain adequate quality
standards may result in reduced customer
satisfaction, additional costs and affect the
Group’s financial performance
• Strict adherence to equipment quality standards, including
continuous monitoring of critical-to-quality metrics to
assess and ensure quality of products issued to customers
• Continued investment in plant automation, platform design
and materials science
Operating & Financial Review
29
Risk
Implication
Mitigating Actions
Maintaining
control of
pooling
equipment
The loss of pooling equipment is inherent in
Brambles’ business model. Failure to maintain
appropriate asset control and recovery
processes may result in additional costs and
affect the Group’s financial performance
Network
capacity
The scale and strength of Brambles’ network
of service centre locations is inherent to its
value proposition for customers and other
stakeholders. A lack of capacity within the
network in a major market could adversely
impact service delivery, competitive position
and financial performance
Customers
and
competitors
Brambles operates in competitive markets.
Unmet customer expectations or increasing
intensity of competitor activity could
affect Brambles’ market penetration
and financial performance
Retailer
acceptance
of pooled
solutions
Retailers are integral to Brambles’ operating
model. A reduction or loss of retailer support
for pooled solutions in their supply chains could
result in a loss of customers and/or market
penetration and adversely impact Brambles’
financial performance
• Dedicated asset control teams across all business units and
the creation of comprehensive processes to increase the
timely collection of assets
• Leveraging existing best practices, including the use of data
analytics to improve asset control and reduce losses across
the Group
• Developing improved processes and controls using
advanced data analytics and digital solutions, including
Artificial Intelligence, Machine Learning and Robotics
supported by deployment of targeted digital tracking
devices to improve communication with key stakeholders
to reduce losses and create more efficient and sustainable
supply chains
• Regular schedule of customer equipment inventory audits
to assess key asset recovery metrics and identify potential
control issues
• In response to COVID-19 and lumber shortage pressures,
instituted additional field collection activities to reduce cycle
times and meet volatile demand, whilst complying with local
social distancing and travel restrictions
• As an essential service provider, Brambles continues to run
operations and support customers and their consumers
across all its markets despite economic uncertainty and
social restrictions arising from the COVID-19 pandemic
• Implemented a range of safety and contingency measures
to ensure service centres remained fully operational
• The 3-year plant automation project in CHEP Americas was
completed in FY21 and has increased capacity across the
US service centre network, avoiding potential disruption
caused by peaks and troughs in demand caused by
the pandemic
• Leveraged Brambles’ unique global scale, network
advantage and sustainable business model to support
customers to meet the unprecedented volatility in consumer
supply chains created by the COVID-19 pandemic
• Collaborating with customers to understand and meet their
evolving needs and adopting digital and other technologies
to innovate products and services, enhance customer
experience and strengthen competitive advantage
• Dedicated teams with executive-level responsibility
for strengthening retailer relationships, identifying
retailer-specific product requirements and ensuring
retailers understand Brambles’ value proposition
• Improving the value proposition for retailers through the
implementation of joint business plans and adopting the
value sharing concept to create win-win opportunities
• Implementation of programmes to facilitate manufacturer
advocacy of Brambles’ pooled solutions
30
Material Risks (continued)
Risk
Implication
Mitigating Actions
Cyber security
The unauthorised access to or use of Brambles’
IT systems could adversely impact Brambles’
ability to serve its customers or compromise
customer or employee data, resulting in
reputational damage, financial loss and/or
adverse operational consequences. The
implications of this risk continue to increase as
institutions and global supply chain companies
have become a specific focus of cyber-attacks
from state actors, and ransomware attacks have
increased globally
IT data
governance
Timber supply
Brambles relies on its IT systems, and the data
stored on those systems, to operate its business.
The identification and classification of Brambles’
key data assets are key components of its
capacity to effectively carry on its businesses
and of its cyber security strategy. The proper
identification and classification of data
assets allows Brambles to prioritise security
technology implementations that offer targeted
and appropriate protection. Incomplete or
unsuitable identification and classification of
key data assets could result in the misuse,
loss of or unauthorised access to sensitive
data due to incorrect storage, processing or
disposal procedures. This, in turn, could result
in financial loss, operational disruption and/or
reputational damage
Access to sustainably certified sources of timber
is essential for Brambles to carry on its business.
A concentration of timber suppliers in any region,
or a shortage of available certified sources of
timber, could adversely impact Brambles’ ability
to maintain its timber pallet pool at levels that
will enable it to meet customer demand for those
products. This could result in loss of customers
and/or market penetration and adversely impact
Brambles’ financial performance. Climate-related
risks for forests and timber supply, including
market, regulatory and physical risks, will emerge
over a five-to-ten-year period
• The ongoing security programme is delivering key
capabilities to protect systems and to detect and promptly
respond to unauthorised or inappropriate activity including
ransomware attacks. Key controls include, but are not
limited to, email and internet filtering, anti-virus software,
multi-factor authentication, enterprise security architecture
covering both offices and service centres, security
awareness training, as well as the use of penetration testing
across Brambles’ network
• In response to the COVID-19 pandemic, conducting
additional risk-based assessments of Brambles’ critical IT
systems and services to strengthen continuity processes
• Brambles continues to use the National Institute of
Standards and Technologies Cyber Security Framework and
the Australian Cyber Security Centre’s Essential 8 advice to
monitor, track and report progress to senior management
• Data Classification and Handling Policy includes guidelines
on the types of data and protection protocols for each
data type
• Brambles has an Acceptable Use Policy which outlines the
standards by which all users must use information and
technology assets and services. Preventative controls are
also in place to mitigate the risk of loss or misuse of data.
These controls include the encryption of laptops, mobile
devices, email data retention controls and the ability to store
data in secure drives
• Brambles has an Information Management Strategy
and continues to seek opportunities to enhance the
management of data and data security. A key element of the
Digital Strategy is using information to power smarter, more
sustainable supply chains
• In response to the timber supply shortages and cost
inflation caused by the COVID-19 pandemic, dedicated
global and regional timber procurement teams manage
timber procurement and mitigate timber supply risks by:
• Developing joint venture partnerships with local sawmills
• Investigating alternative materials and species for future
sources of timber
• Acquisition of timber farm in South Africa
• In line with Brambles’ 2025 sustainability targets, 100% of
timber is sourced from certified sources, and Brambles has
continued to meet year-on-year improvement targets of
sourcing Chain of Custody certified timber
Operating & Financial Review
31
Risk
Implication
Mitigating Actions
Regulatory
compliance
Brambles operates in a large number of
countries with widely differing legal regimes,
legislative requirements and compliance
cultures. A failure to comply with regulatory
obligations and local laws could adversely affect
Brambles’ operational and financial performance
and its reputation
• Dedicated Chief Compliance Officer responsible for
monitoring the implementation and ongoing application
of compliance management systems
• A Code of Conduct which provides a framework for detailed
policies addressing regulatory compliance
• A vendor due diligence programme to assess the
compliance of suppliers with various legal and regulatory
requirements, such as bribery and corruption, sanctions
violations, modern slavery and human rights practices
• Adoption of Group-wide online compliance training
programmes to supplement face-to-face training
Attraction and
retention of
talent
A failure to attract, develop and retain high
performing individuals could adversely impact
Brambles’ ability to implement and manage
its strategic objectives
• Detailed talent management and succession planning
processes to identify high potential employees and prepare
successors for senior executive positions
• Adoption of development programmes for management,
Digital
disruption
The development of cost-effective digital supply
chain solutions has the potential to materially
change supply chain dynamics. If a third-party
were to develop such solutions before Brambles,
it could adversely impact Brambles’ business
models. This could result in loss of customers
and/or market penetration and adversely impact
Brambles’ financial performance
Safety
Brambles is subject to inherent operational
risks including industrial hazards, road traffic or
transportation accidents that could potentially
result in serious injury or fatality of employees,
contractors or members of the public
leadership and functional expertise through all
employment levels
• Formal mentoring programmes offered to all employees
• Implemented a range of activities to support office-based
personnel now working remotely due to the COVID-19
pandemic including, but not limited to, provision of required
IT, connectivity services and mental and financial wellbeing
support programmes
• Brambles is innovating, developing, testing and refining
digital solutions which have the potential to provide
commercial digital services to its customers and to assist
its businesses to manage equipment losses and asset
efficiency more effectively
• Through the establishment of BXB Digital, Brambles
has developed unique functional capabilities and robust
technical solutions to explore the role of technology in its
business and customer offering and to engage in innovation
of products and services in the digital space
• The Zero Harm Charter states that everyone has the right
to be safe at work and to return home as healthy as they
started the day
• Appointed a new Global Executive of Health and Safety with
extensive industry experience
• Successfully executed a range of actions and protocols to
keep people safe during the pandemic
• A COVID-19 global task force, with Senior Health and
Safety representation, supported by external industry and
medical experts, works with regional taskforces to establish
processes and protocols in accordance with government
advice in different geographies
• Implemented a number of processes and protocols in
service centres, such as social distancing measures, more
frequent cleaning and disinfecting, thermal scanning and
distribution of personal protective equipment
• Continued to further enhance safety management systems,
including focusing on human and organisation behavioural
principles and implementing additional engineering and
technology-based controls
• Use of safety metrics, which measure work-related injuries,
lost time, modified duties and incidents requiring medical
treatment, with regular reporting and monitoring to the
Brambles Board
32
Material Risks (continued)
Risk
Implication
Mitigating Actions
Inclusion and
diversity
Climate
change
Brambles has a diverse workforce and believes
that an inclusive work environment allows
employees to realise their full potential,
regardless of gender, race, religion, age, disability,
ethnicity, sexual orientation or any other factor
that makes an individual unique. Any activities
or practices within its operations or in its supply
chains that could undermine this intent violate
Brambles’ values and are detrimental to the
integrity and credibility of its brands
Climate change is influencing both acute short-
term weather events and longer-term chronic
climate trends. These climate-related physical
impacts are influencing society and consumer
purchasing behaviour, translating into business
trends such as changes in markets, technology,
policy, legal requirements and reputational
expectations. Responding to the specific
challenges of climate change is intimately linked
to Brambles’ sustainable, low-carbon circular
‘share and reuse’ model
• Brambles fosters a diverse and inclusive environment, to be
better able to relate to customers, suppliers, communities
and co-workers
• Established a global Inclusion and Diversity Council with
programmes and initiatives to encourage, celebrate and
support all forms of diversity
• Continuing progress in improving gender diversity at all
levels within the organisation including Board, executive
leadership and management positions
• Brambles is a sustainable business because of its circular
‘share and reuse’ model, which reduces demand on natural
resources, regenerates forests, eliminates waste for
customers and reduces carbon emissions from the world’s
supply chains
• As a leader in the circular economy, Brambles understands
its potential to address climate change by focusing on both
its impact on climate change and the impact of climate
change on Brambles
• Brambles is committed to a 1.5ºC climate future aligned
with the Paris Agreement and carbon emissions SBTs.
As part of this objective, Brambles became carbon neutral in
June 2021 and 100% of electricity used at its service centres
was from renewable sources
• Brambles’ demand for sustainably sourced timber
addresses deforestation and its impact on climate change.
Through afforestation our 2025 strategy will increase
forest cover
• Brambles has submitted its SBT covering its direct
emissions and those in its supply chain as part of its
2025 commitments
• Brambles has adopted the Task Force on Climate-related
Financial Disclosures (TCFD) framework with a project to
assess the risks and opportunities for the business using
climate scenario analysis (further details on TCFD are on
page 12 with a supporting TCFD supplement on
brambles.com/tcfd)
Managing Climate-Related Risks at Brambles
Brambles recognises its external operating context is changing in response to climate-related issues.
During 2021, Brambles continued the process which it first adopted in 2019 of assessing its exposure to climate change risks by reference
to the recommendations of the Financial Stability Board’s TCFD. Assessing Brambles’ climate change risks in this manner complies with
Recommendation 7.4 of the 4th Edition of the ASX Corporate Governance Principles and Recommendations.
As part of this process, climate-related risk has been identified as a stand-alone risk and will be reassessed using Brambles’ risk
management framework and approach. In addition, Brambles is evaluating existing strategic and operating risks in the context of climate-
related risk in its external operating environment. Further details on Brambles’ approach to climate-related risks are set out on pages
22 to 24, with a more detailed TCFD disclosure on brambles.com/tcfd
Financial Review
1. Financial Review
1.1 Group Overview
1.1.1 Summary of 2021 Financial Results
US$m
(Continuing operations)
CHEP Americas
CHEP EMEA
CHEP Asia-Pacific
Sales revenue
CHEP Americas
CHEP EMEA
CHEP Asia-Pacific
Corporate
Underlying Profit
Significant Items
Operating profit
Net finance costs
Tax expense
Profit after tax from continuing operations
Loss from discontinued operations
Profit after tax
Average Capital Invested
Return on Capital Invested
Weighted average number of shares (m)
Basic EPS (US cents)
Basic EPS from continuing operations (US cents)
FY21
2,627.5
2,056.4
525.9
5,209.8
385.5
462.7
146.2
(115.1)
879.3
-
879.3
(85.6)
(258.7)
535.0
(8.9)
526.1
4,937.9
17.8%
1,475.1
35.7
36.3
FY20
2,449.2
1,831.9
436.8
4,717.9
344.2
410.3
118.0
(73.1)
799.4
-
799.4
(80.8)
(210.6)
508.0
(60.0)
448.0
4,698.7
17.0%
1,548.7
28.9
32.8
Change
Actual FX
Constant FX
7%
12%
20%
10%
12%
13%
24%
(57)%
10%
10%
(6)%
(23)%
5%
17%
5%
0.8pts
(5)%
24%
11%
7%
6%
9%
7%
15%
8%
12%
(45)%
8%
8%
(4)%
(15)%
5%
19%
2%
1.1pts
(5)%
25%
11%
Note on FX: The variance between actual and constant FX performance reflects the appreciation of Brambles' key operating
currencies, particularly the Australian dollar, British pound and the Euro relative to Brambles' reporting currency, the US dollar.
FY21 Operating Environment
During the year, Brambles responded to numerous challenges
associated with COVID-19, Brexit and a range of inflationary
and supply pressures on key input costs, including lumber,
transport and labour.
Customer demand for pallets was elevated and unpredictable,
reflecting COVID-19 related increases in the level of at-home
consumption of consumer staple products and numerous
changes in restrictions impacting on-premise consumption.
Brexit added further supply chain uncertainty resulting in
increased inventory levels and changes in demand patterns.
Inflationary pressures accelerated in the period driven by
changes to both supply and demand dynamics across the key
inputs of lumber, transport and labour in all regions.
Global lumber supply challenges in the second half of the year
had a material impact on pallet availability and the cost of
both new pallets and lumber for repairs. This impact was
particularly evident in the US market where strong lumber
demand from the US housing and DIY sectors coincided with
reduced sawmill capacity and transport and shipping capacity
constraints. This dynamic combined with increased lumber
demand in China resulted in record levels of lumber inflation
and industry-wide pallet shortages in key markets. In
response, manufacturers and retailers increased pallet
balances across their operations to de-risk disruptions to their
supply chains.
Lumber surcharges linked to market indices in North America
partially recovered the impact of higher lumber costs in
the Year, which was primarily reflected in the higher pallet
costs included in capital expenditure and, to a lesser extent,
higher lumber costs used for pallet repairs reflected in
operating costs.
Collectively, demand volatility, inflationary pressures and
disruptions to supply chains due to COVID-19, Brexit and
pallet availability challenges resulted in higher operating and
capital costs across the Group. Brambles more than offset
operating cost increases and delivered operating profit
leverage through a combination of pricing initiatives
(including surcharges in North America), disciplined cost
control and supply chain efficiency benefits from service
33
Operating & Financial Review
Financial Review – continued
centre automation, sawmill investments and pallet durability
initiatives across the Group.
Sales revenue from continuing operations of
US$5,209.8 million increased 7% at constant currency and
included 4 percentage points of pricing growth and
3 percentage points of volume growth. Growth was driven by
strong customer demand and price realisation across the
global pallets businesses and a better than expected recovery
in the automotive business, which was severely impacted
by the outbreak of COVID-19 in the fourth quarter of the
prior year.
Pricing contributed 4% to revenue growth, reflecting initiatives
in all regions to recover input-cost inflation and cost-to-serve
increases in response to the challenging operating conditions.
Like-for-like volume growth of 2% reflected increased pallet
demand from existing customers in the consumer staples
sector due to high levels of at-home consumption in
developed markets and increased customer and retailer
inventory holding to de-risk supply chains in key markets.
Demand from existing customers in the automotive business
increased in line with manufacturing activity.
Net new business growth of 1% was largely driven by
conversion of new customers to pallet pooling across Central
and Eastern Europe and rollover contribution from a large RPC
contract win in Australia. Growth with new customers in the
Americas region was modest as the business focused on
servicing strong demand from existing customers given
network capacity constraints and pallet availability challenges
in the region.
Underlying Profit and Operating Profit of US$879.3 million
increased 8% at constant currency, reflecting volume and
price growth, supply chain efficiencies, income from lumber
surcharges in North America of approximately US$60 million
and one-off compensation payments of US$10 million
primarily relating to the relocation of a service centre in the
Asia-Pacific region. These contributions to profit more than
offset higher operating costs and asset charges during the
year.
At the Group level, the US$295 million contribution to profit
from volume growth, price and North American lumber
surcharges was partly offset by:
-
Plant cost increases of US$74 million (excluding North
American lumber surcharge income), reflecting higher
repair costs due to lumber inflation and additional
handling costs driven by changes in network flows and
scarcity of pallets in all regions as the businesses utilised
the existing pallet pool to service customer demand.
These cost increases were partly offset by US$24 million
of efficiencies associated with service centre automation
projects and pallet durability initiatives across the Group;
- Net transport cost increases of US$56 million (including
transport surcharge income), reflecting transport inflation
and additional pallet collections and relocations. Other
transport cost increases including additional transport
1 Irrecoverable Pooling Equipment Provision.
34
-
miles associated with the Latin America asset
management programme and Brexit-related pallet
relocations in Europe, were partly offset by automation
benefits in the US and efficiency gains in Latin America;
IPEP1 expense increases of US$39 million driven by
the US business with First In First Out (FIFO) unit cost
increases and higher losses due to a range of factors
including an increased gap between recycler incentives to
return pallets and both their costs to recover pallets and
the value of pallets to third parties. Overall recoveries in
the US market were also impacted by labour and
transport capacity constraints and some COVID-19
related site access restrictions. In addition, variability in
demand and pallet scarcity resulted in some stockpiling
of pallets by retailers and manufacturers. Across the rest
of the Group, lower loss rates offset higher FIFO unit
pallet costs;
-
- Depreciation expense increases of US$29 million
in line with pool growth and investments in
automation programmes;
Shaping Our Future (including BXB Digital) cost increases
of US$25 million were largely driven by investments in
digital, customer experience and overhead supply chain
efficiency projects and consultancy costs; and
- Other indirect cost increases of US$19 million, reflecting
the impact of higher unit FIFO values on pallet disposals
and scraps as well as increased overhead investments in
line with growth.
Profit after tax from continuing operations of
US$535.0 million increased 5% at constant currency, reflecting
operating profit growth offset by an increase in finance costs
and tax expense.
Net finance costs increased 4% at constant currency, reflecting
lower deposit balances due to the ongoing capital
management programme and lower Australian dollar average
deposit rates.
Tax expense was US$258.7 million, up 15% in constant
currency and included a US$22.7 million Significant Item
related to the revaluation of deferred tax balances in response
to the announced increase in the United Kingdom corporate
tax rate from 19% to 25% with effect from 1 April 2023. The
effective tax rate on Underlying Profit in the period was 29.7%
compared to 29.3% in FY20.
Loss from discontinued operations was US$8.9 million,
largely relating to the Kegstar business with the small gain on
the divestment of this business being more than offset by
operating losses in the year reflecting the COVID-19 related
closures of on-premise venues and the impact of cumulative
FX translation losses recognised on divestment. Prior year
losses relate to the operating loss in Kegstar, the impairment
of Kegstar PPE and intangibles, and the impairment of the
deferred consideration receivable from First Reserve.
Operating & Financial Review
Financial Review – continued
Return on Capital Invested was 17.8%, an increase of
1.1 percentage points at constant currency reflecting the
strong Underlying Profit performance offsetting the increase
in Average Capital Invested which increased 2% at constant
currency. This increase reflected the impact of lumber inflation
on pallet prices in the second half of the year combined with
capital investments to support volume growth and Brexit-
related stocking in Europe.
Cash Flow Reconciliation
US$m
Underlying Profit
Depreciation and amortisation
IPEP expense
EBITDA
FY21
FY20 Change
879.3
665.0
198.3
799.4
607.7
154.7
79.9
57.3
43.6
1,742.6 1,561.8
180.8
Capital expenditure
(1,003.3)
(916.1)
(87.2)
US supply chain investment
(51.7)
(72.7)
Proceeds from sale of PPE
145.8
103.7
21.0
42.1
Working capital movement
Other
37.3
30.4
74.2
(36.9)
3.9
26.5
Cash Flow from Operations
901.1
754.8
146.3
Significant Items
Discontinued operations
(0.9)
(7.1)
(3.4)
(15.5)
Financing costs and tax
(271.1)
(273.7)
2.5
8.4
2.6
Free Cash Flow
622.0
462.2
159.8
Dividends paid – ordinary
(280.8)
(290.7)
9.9
Free Cash Flow after
ordinary dividends
341.2
171.5
169.7
Dividends paid – special
-
(183.2)
183.2
Free Cash Flow after special
dividends
341.2
(11.7)
352.9
Cash Flow from Operations of US$901.1 million increased
US$146.3 million on the prior year driven by higher earnings,
increased compensations for lost equipment in the US and
Europe, and proceeds primarily relating to the one-off
compensations for the mandatory service centre relocation in
the Asia-Pacific region. These increases were partly offset by
higher capital expenditure and a lower contribution to cash
flow generation from working capital benefits, despite
ongoing improvements in the year.
On a cash basis, capital expenditure (excluding US supply
chain investments) of US$1,003.3 million increased
US$87.2 million, with investments to support growth and
higher pallet prices due to lumber inflation being partly offset
by improved payment terms on pooling equipment purchases.
Operating cash flow also includes a US$180 million timing
benefit relating to the delay of pallet purchases into FY22 due
to lumber availability constraints. These benefits are expected
to reverse in FY22.
On an accruals basis, capital expenditure increased
US$220.1 million at constant currency driven by a
US$228.0 million increase in pooling capital expenditure. This
increase reflected lumber inflation of US$150 million and
approximately US$80 million of additional pooling equipment
purchases to support volume growth, lower pallet recoveries
in the US and higher inventory levels, particularly evident
across supply chains in Europe.
Non-pooling capital expenditure decreased US$7.9 million at
constant currency as increased investments in wash facilities
to support the large Australian RPC contract were largely
offset by a decline in US service centre automation spend as
the three-year programme announced to the market in 2018
was completed during the year. Further automation
investments outside of this programme commenced during
the year with minimal spend in FY21.
The year-on-year decrease in working capital movements
reflected the cycling of material improvements in cash and
European VAT collections in the prior year. Further
improvements in working capital management contributed to
additional working capital benefits in the current period.
Other cash flow items improved US$26.5 million and
include increased provisions predominantly relating to
employee costs.
Free Cash Flow after ordinary dividends was a surplus of
US$341.2 million and increased US$169.7 million on the prior
year driven by the improvement in Cash Flow from
Operations. Included within Free Cash Flow were US$215
million of timing benefits relating to the delayed pallet
purchases of US$180 million referenced above and tax
payments of US$35.0 million. Excluding these timing benefits
which are expected to reverse in FY22, the business delivered
$126.2 million of positive Free Cash Flow after dividends.
Cash outflows relating to financing costs decreased
US$12.0 million due to the cycling of prior year costs relating
to the early termination of the US$500 million 144a bond.
Free Cash Flow after ordinary and special dividends
increased US$352.9 million, reflecting the prior year payment
of the US$183.2 million special dividend in October 2019.
Segment Analysis
1.1.2 CHEP Americas
US$m
Pallets
Containers
FY21
FY20
2,590.0
2,412.5
37.5
36.7
Sales revenue
2,627.5
2,449.2
Change
Actual
FX
Constant
FX
7%
2%
7%
7%
3%
7%
15%
4%
Underlying Profit
385.5
344.2
12%
2,449.4
2,368.6
3%
Average Capital
Invested
Return on Capital
Invested
15.7%
14.5% 1.2pts
1.4pts
Sales Revenue
Pallets sales revenue of US$2,590.0 million increased 7% at
constant currency, reflecting higher levels of demand from
35
Operating & Financial Review
Financial Review – continued
customers in North America and price realisation in the US
and Latin American businesses.
-
US pallets sales revenue of US$1,928.1 million increased 7% at
constant currency, comprising:
-
Price growth of 5% driven by actions to recover the
higher cost-to-serve;
Like-for-like volume growth of 2%, reflecting sustained
strong levels of demand from customers in the consumer
staples sectors during the year. The rate of growth
moderated in the fourth quarter as the business cycled
a strong prior year comparative which benefitted from
record levels of demand following the onset of
COVID-19; and
- Net new business was in line with the prior year as the
business prioritised servicing strong demand from
existing customers during a period of network capacity
constraints and lumber availability challenges.
Canada pallets sales revenue of US$310.5 million increased
6% at constant currency, reflecting strong growth with new
and existing customers.
Latin America pallets sales revenue of US$351.4 million
increased 13% at constant currency, driven by pricing actions
to recover the cost-to-serve and net new business growth.
Containers sales revenue was US$37.5 million, up 3%
at constant currency, reflecting price mix benefits partly offset
by the rollover impact of prior year losses.
Profit
Underlying Profit of US$385.5 million increased 15% at
constant currency and included a 1-percentage point
improvement in US margins. Underlying Profit included
income from lumber surcharges in North America of
approximately US$60 million which partially recovered the
impact of lumber inflation reflected in both the higher costs of
new pallet purchases recognised in capital expenditure, and
increases in pallet repair costs which were recognised in
operating expenses.
The combined revenue and gross lumber surcharge income
contribution to profit of US$212 million, was partly offset by:
-
Plant cost increases of US$59 million (excluding lumber
surcharge income), reflecting handling and repair cost
increases associated with network disruptions and higher
pallet repair costs due to record levels of lumber inflation
in the fourth quarter of the year. These cost increases
were partly offset by US$15 million of efficiencies
including damage rate improvements and increased
year-on-year benefits from the US service centre
automation programme;
- Net transport cost increases of US$42 million (including
transport surcharge income) reflecting the impact of
inflation on transport costs across the region, additional
pallet collection and relocations in the US, reflecting
changing network dynamics, and incremental costs to
support the Latin American asset management
programme;
- Depreciation cost increases of US$14 million due to pool
growth and investments in US supply chain programmes;
36
-
IPEP expense increases of US$39 million driven by
increased FIFO unit pallet costs and higher losses in the
US market reflecting lower pallet returns from recyclers
and other market participants. This was driven by a
combination of escalating pallet prices relative to recycler
incentives, transport capacity and labour availability
constraints and industry-wide pallet shortages which
resulted in customer stockpiling of pallets. These
increases were partially offset by asset efficiency
improvements across the rest of the region; and
- Other cost increases of US$7 million, largely reflecting
higher FIFO values on assets disposed.
Return on Capital Invested
Return on Capital Invested of 15.7% increased 1.4 percentage
points at constant currency due to increased profitability in
the region. Average capital invested increased 4% in constant
currency, largely reflecting the impact of lumber inflation on
pallet purchases.
1.1.3 CHEP EMEA
US$m
Pallets
RPC
Containers
FY21
FY20
1,765.3 1,571.1
28.9
27.3
262.2
233.5
Sales revenue
2,056.4 1,831.9
Underlying Profit
462.7
410.3
1,943.5 1,830.1
Average Capital
Invested
Return on Capital
Invested
Change
Actual
FX
Constant
FX
12%
6%
12%
12%
13%
6%
5%
3%
6%
6%
8%
-
23.8% 22.4%
1.4pts
1.8pts
Sales Revenue
Pallets sales revenue of US$1,765.3 million increased 5% at
constant currency, reflecting strong volume growth in the
European pallet business and price realisation across the
region.
European pallets sales revenue of US$1,556.6 million
increased 5% at constant currency, comprising:
- Net new business growth of 3% driven by contributions
from current and prior year contract wins in
Central & Eastern Europe;
Like-for-like volume growth of 1%, reflecting increased
demand for consumer staples and higher inventory levels
across FMCG supply chains; and
Price growth of 1% driven by indexation and other pricing
initiatives to recover the cost-to-serve.
-
-
India, Middle East, Turkey, and Africa (IMETA) pallets sales
revenue of US$208.7 million increased 6% at constant
currency, driven by price realisation across the region to offset
input cost inflation and cost-to-serve increases. Volumes were
broadly in line with the prior year as growth with existing
customers across most of the region was offset by a
slowdown in India due to COVID-19 and the loss of high cost-
to-serve customers in Turkey and India.
Operating & Financial Review
Financial Review – continued
RPC and Containers sales revenue of US$291.1 million
increased 6% at constant currency, reflecting:
-
Automotive sales revenue of US$198.9 million, up 10% on
the prior year, reflecting better-than-expected recovery in
manufacturing activity during the year and cycling the
adverse impact of COVID-19 on volumes in the second
half of the prior year;
IBC sales revenue of US$63.3 million, down 5% on the
prior year, reflecting lower volumes in Europe; and
RPC sales revenue of US$28.9 million, up 3% on the prior
year, reflecting volume growth in the South African
business.
-
-
Profit
Underlying Profit of US$462.7 million increased 8% at
constant currency as the revenue contribution to profit of
US$65 million more than offset:
- Net transport cost increases of US$12 million, reflecting
inflation and scarcity in third-party transport and
additional relocation costs to support demand volatility
due to COVID-19 and Brexit;
- Net plant cost increases of US$9 million driven by higher
input-cost inflation and additional costs relating to
heat treatment of pallets. These cost increases were
partly offset by lower damage rate due to pallet
durability improvements;
- Depreciation increases of US$11 million in line with
growth in the pallet pool; and
- Other indirect cost increases of US$2 million, reflecting
inflation and additional overheads to support improved
business capabilities across the region. These increases
were partly offset by business productivity initiatives.
Return on Capital Invested
Return on Capital Invested of 23.8% increased 1.8 percentage
points at constant currency, reflecting the strong Underlying
Profit performance and asset productivity improvements.
1.1.4 CHEP Asia-Pacific
US$m
Pallets
RPC
Containers
FY21
FY20
397.5
340.7
80.9
47.5
51.4
44.7
Sales revenue
525.9
436.8
Underlying Profit
146.2
118.0
Change
Actual
FX
Constant
FX
17%
57%
6%
20%
24%
6%
41%
(3)%
9%
12%
Average Capital
Invested
Return on Capital
Invested
569.6
490.6
16%
6%
25.7% 24.1%
1.6pts
1.2pts
Sales Revenue
Pallets sales revenue was US$397.5 million, up 6% at constant
currency, reflecting both price realisation and volume growth
in the Australian pallets business and continued expansion of
the timber pallets business in China.
RPC and Containers sales revenue was US$128.4 million, up
20% driven by contributions from a large Australian RPC
contract won in the second half of FY20.
Profit
Underlying Profit of US$146.2 million increased 12% at
constant currency and included US$10 million of one-off net
benefits largely relating to the compulsory relocation of a
service centre. Excluding these one-off benefits, Underlying
Profit increased 3% at constant currency as the strong sales
contribution to profit more than offset anticipated
commencement costs associated with the onboarding of the
large Australian RPC contract and additional cost increases
due to inflationary pressures, lower asset compensations and
COVID-19-related costs.
Return on Capital Invested
Return on Capital Invested of 25.7% increased 1.2 percentage
points at constant currency, reflecting the one-off profit
benefits outlined above. Excluding these one-off items,
Return on Capital Invested was down (0.6) percentage points,
reflecting the capital investment to support the Australian RPC
contract win.
37
Operating & Financial Review
Board & Executive Leadership Team
Board of Directors
John Mullen Non-Executive Chair (Independent)
Chair of the Nominations Committee and member of the Remuneration Committee
Joined Brambles as a Non-Executive Director and Chair elect in November 2019 and became Chair on
1 July 2020. He is currently a Non-Executive Director and Chair of Telstra, and Chair of the unlisted
entity, Toll Group. Previously, John was Chief Executive Officer of Asciano, Australia’s largest ports and
rail operator, from 2011 to 2016. Prior to that, John had a distinguished career with the DHL Group
from 1994 to 2009, ultimately becoming Chief Executive Officer of DHL Express in 2006. He also
served as a Director of Deutsche Post World Net, the parent company of DHL Express. Before joining
DHL, John spent 10 years with the TNT Group, culminating in the role of Chief Executive Officer of
TNT Express Worldwide, which he held from 1990 to 1994. He was formerly a Non-Executive Director
of Brambles (from 2009 to 2011), and has also served as a director on the boards of Brookfield
Infrastructure Partners LP, Macquarie Airports Corporation, Embarq LLC (USA), Transportes
Guipuzcoana (Spain) and Ducros Services Rapides (France). He was also Chair of the US National
Foreign Trade Council in Washington from 2008 to 2010. John holds a Bachelor of Science from the
University of Surrey.
Graham Chipchase Chief Executive Officer
Chair of the Executive Leadership Team
Joined Brambles at the beginning of January 2017 as Chief Executive Officer Designate and became
Chief Executive Officer on 20 February 2017. Prior to Brambles, Graham was Chief Executive Officer of
Rexam plc, one of the world’s largest consumer packaging companies, from 2010 to June 2016.
Graham had first joined Rexam in 2003 as Group Finance Director before moving to Group Director of
Plastic Packaging. Graham left Rexam in June 2016, after Rexam was successfully acquired by Ball
Corporation. He is also a Non-Executive Director of AstraZeneca plc and its Senior Independent
Director, and was chair of its Remuneration Committee from April 2015 to July 2020. He holds an MA
(Hons) Chemistry from Oriel College, Oxford, and is a Fellow of the Institute of Chartered Accountants
in England and Wales.
George El-Zoghbi Non-Executive Director (Independent)
Member of the Nominations and Remuneration Committees
Joined Brambles as a Non-Executive Director in January 2016. George has extensive international
consumer packaged goods and supply chain experience. He is currently the Chief Executive Officer of
Arnott’s Biscuits Limited. He is also a Special Advisor to Kraft Heinz Company and a Strategic Advisor
to Altimetrik, a US-based digital and IT solutions company. Previously, George was the
Chief Operating Officer of US commercial businesses for Kraft Heinz Company from the merger of
Kraft Foods Group and H.J. Heinz in July 2015 until October 2017 and a Director of Kraft Heinz
Company from April 2018 to April 2021. Prior to that merger, George held a number of key leadership
roles at Kraft including Chief Operating Officer. Prior to joining Kraft in 2007, he held a number of
executive roles with Fonterra Cooperative and various managerial and sales roles with Associated
British Foods. He holds a Diploma of Business, Marketing, as well as a Master of Enterprise from the
University of Melbourne and has also completed an Accelerated Development Programme at MC
London Business School.
38
Board & Executive Leadership Team
Board & Executive Leadership Team – continued
Elizabeth Fagan CBE Non-Executive Director (Independent)
Member of the Audit & Risk and Nominations Committees
Joined Brambles as a Non-Executive Director in June 2018. Elizabeth has extensive experience in the
international retail sector. She is a Commander of the Order of the British Empire (CBE). Currently she
is Chair of the Board of D2N2 Local Enterprise Partnership. Previously, she was the Non-Executive
Chair of Boots UK & Ireland, Senior Vice President and Managing Director of Boots, leading all Boots
businesses across the UK and the Republic of Ireland. Prior to that, she was Senior Vice President,
Managing Director, International Retail for Walgreens Boots Alliance, from the Company’s creation in
December 2014 to 2016, Marketing Director of Boots and Managing Director of Boots Opticians, and
previously worked for Boots as Group Buyer from 1983 to 1991. Before re-joining the Boots business
in 2006, Elizabeth worked for DSG International plc for 10 years, where she held a number of senior
positions, including Marketing Director, Group Marketing Director and Managing Director of The Link.
She holds a Bachelor of Science, Biochemistry, from Strathclyde University and an Honorary Doctorate
of Science from Nottingham Trent University.
Tony Froggatt Non-Executive Director (Independent)
Member of the Remuneration and Nominations Committees
Joined Brambles as a Non-Executive Director in June 2006. He is Chair of Foodbank Australia.
Previously, Tony was a Non-Executive Director of Coca-Cola Amatil, AXA Asia Pacific Holdings and
Billabong International and was Chief Executive Officer of Scottish & Newcastle plc from May 2003 to
October 2007. He began his career with the Gillette Company and has held a wide range of sales,
marketing and general management positions in many countries with major consumer goods
companies including H.J. Heinz, Diageo and Seagram. He holds a Bachelor of Law from Queen Mary
College, London, and a Master of Business Administration from Columbia Business School, New York.
Tahira Hassan Non-Executive Director (Independent)
Member of the Audit & Risk and Nominations Committees
Joined Brambles as a Non-Executive Director in December 2011. Tahira is a Non-Executive Director of
Canada Pension Plan Investments and was previously a Non-Executive Director of Recall Holdings.
She had a distinguished 26-year career with Nestlé. From 2003 to 2006, she was Senior Vice President
& Head of Global Supply Chain. Based in Switzerland, this was a new role created to lead the
reshaping of Nestlé’s global approach to supply chain management. Her other roles included Senior
Vice President & Global Business Head for Nescafé Ready To Drink from 2006 to 2009, and Vice
President, Deputy Operations, Zone Americas from 2001 to 2003. Previously, Tahira held various
leadership positions in Nestlé Canada including President, Ice Cream and Executive Vice President,
Consumer Demand Chain & Information Services. Tahira is a Fellow of the Chartered Institute of
Management Accountants, UK, and a Certified Member of the Society of Management Accountants of
Canada.
39
Board & Executive Leadership Team
Board & Executive Leadership Team – continued
Ken McCall Non-Executive Director (Independent)
Member of the Audit & Risk and Nominations Committees
Joined Brambles as a Non-Executive Director in July 2020. Ken’s background is in global network
management, international logistics and supply chain, having held leadership positions including
Chief Executive, DHL Express UK & Ireland, from 2008 to 2010, and MD, Networks and Operations,
DHL Express Europe, which consolidated his extensive experience of continental Europe. He lived and
worked in China during his time with TNT NV, as CEO TNT China, 2004 to 2007, and CEO TNT Asia,
Middle East, Africa & Indian Subcontinent, 1996 to 2004. More recently, Ken served as Deputy Group
CEO at Europcar Mobility Group from 2016 to 2019, having previously held the roles of Group Chief
Operating Officer and Group Managing Director for the UK. Ken has more than 10 years’ experience
as a Non-Executive Director. He served on the board of global fashion retailer SuperDry plc from
2010 to 2016 and was a member of its Audit and Remuneration Committees. He is currently Senior
Independent Non-Executive Director for Post Office Limited, for which he chairs the Remuneration
Committee and is a member of the Nomination and Audit, Risk and Compliance Committees. Ken is a
member of the Chartered Institute of Transport and Logistics, Singapore.
Jim Miller Non-Executive Director (Independent)
Member of the Remuneration and Nominations Committees
Joined Brambles as a Non-Executive Director in March 2019. Jim has extensive operational and cross
functional supply chain experience in digital technology. He is currently Chief Technical Officer with
US-based e-commerce company Wayfair Inc. In addition, Jim is currently a Non-Executive Director of
The RealReal, Inc., also a US e-commerce company. Jim has held a number of senior executive roles
including Vice President, Worldwide Operations for Google Inc from 2010 to 2018, where he was
responsible for global operations, planning, supply chain and new product introduction for Google’s
IT infrastructure and Google Fiber. Previously, he was Executive Vice President, Industrial, Automotive
and Multi-Media for Sanmina Corporation from 2009 to 2010, where he was responsible for its
industrial, clean tech, multi-media and automotive businesses. Prior to that, he held various executive
roles at Cisco Systems, and was Vice President Global Supply Chain for Amazon where he was
responsible for the inception of its supply chain organisation. He has also held various executive roles
at IBM and Intel. Jim holds a Bachelor of Science, Aerospace Engineering, from Purdue University and
a Master of Science and Engineering and a Master of Science and Management from the
Massachusetts Institute of Technology.
Nessa O'Sullivan Chief Financial Officer
Joined Brambles in October 2016 and was appointed to the role of Chief Financial Officer on 17
November 2016. She became an Executive Director of Brambles in April 2017. Prior to joining
Brambles, Nessa worked for 10 years at Coca-Cola Amatil in a number of senior financial and
operating roles, including Group Chief Financial Officer from 2010 to May 2015. She was also Group
Chief Financial Officer for Operations and Chief Financial Officer for Australia and New Zealand. Nessa
began her career working as an auditor at Price Waterhouse in Dublin, New York and Sydney. She
spent two years at Tyco Grinnell Asia Pacific before joining PepsiCo/Yum! Restaurants in 1995. Over a
10-year period at Yum! Restaurants International, she held a number of senior finance, IT and strategy
roles, including five years as Chief Financial Officer for the South Pacific Region. She is also a Non-
Executive Director of Molson Coors Beverage Company. Nessa is a Fellow of the Institute of Chartered
Accountants in Ireland. She holds a Bachelor of Commerce from University College Dublin and is a
graduate of the Australian Institute of Company Directors.
40
Board & Executive Leadership Team
Board & Executive Leadership Team – continued
Scott Perkins Non-Executive Director (Independent)
Chair of the Remuneration Committee and member of the Audit & Risk and Nominations Committees
Joined Brambles as a Non-Executive Director in June 2015. Scott is currently Chair of Origin Energy
and a Non-Executive Director of Woolworths Group Limited. He was also a Director of Meridian
Energy from 1999 to 2002. Scott has extensive experience in corporate strategy, capital markets and
investment banking. He held senior executive leadership positions at Deutsche Bank from 1999 to
2013, including as Managing Director and Head of Corporate Finance for Australia and New Zealand
and as a member of the Asia-Pacific management committee. Scott is also active in the charity and
public policy sector as the founder or director of a number of organisations. Scott holds a Bachelor of
Commerce degree and a Bachelor of Laws with Honours degree from the University of Auckland.
Nora Scheinkestel Non-Executive Director (Independent)
Chair of the Audit & Risk Committee and member of the Nominations Committee
Joined Brambles as a Non-Executive Director on 1 June 2020 and became Chair of the
Audit Committee on 20 August 2020. Nora is currently a Non-Executive Director of Telstra,
Westpac Banking Corporation and AusNet Services Limited. She is an experienced company director
with more than 25 years’ experience as a Non-Executive Chair and Director of companies in a wide
range of industry sectors including the public, government and private sectors. A former banking
executive, Nora has extensive financial and risk management expertise, including having chaired the
audit and risk committees of a number of listed companies. She is a published author, has worked as
an Associate Professor in the Melbourne Business School at Melbourne University and a former
member of the Takeovers Panel. She was awarded a centenary medal for services to Australian society
in business leadership. Nora holds a Doctor of Philosophy and a Bachelor of Law (Hons) from the
University of Melbourne and is a Fellow of the Australian Institute of Company Directors.
41
Board & Executive Leadership Team
Board & Executive Leadership Team – continued
Executive Leadership Team
Graham Chipchase Chief Executive Officer
Chair of the Executive Leadership Team
(See biography on page 38.)
Carmelo Alonso-Bernaola Senior Vice President, Global Supply Chain
Joined Brambles in 1992 and was appointed Senior Vice President Supply Chain for CHEP’s global
operations in February 2011. At Brambles, Carmelo has served in a range of supply chain roles,
ranging from Quality Manager in Iberia, Logistics Director for South Europe, Vice President Logistics
Europe, Senior Vice President Supply Chain Europe to his current global role in Supply Chain. Carmelo
holds an Agro-industrial Engineering degree from the Universidad Politécnica of Madrid. He also
holds a Master of Business Administration from IE Business School, Madrid, and a Diploma of
Manufacturing and Production Management. After 29 years of service to Brambles, Carmelo will be
leaving Brambles during the 2022 financial year.
Phillip Austin President, CHEP Asia-Pacific & CHEP India, Middle East, Turkey and Africa
Joined Brambles in 1989 and became President CHEP Asia-Pacific in October 2014 and from July 2021
he is President CHEP IMETA (India, Middle East, Turkey and Africa). Phillip previously held the
positions of President CHEP Australia and New Zealand and President CHEP Australia. He has held a
variety of senior roles across Brambles including Chief Financial Officer of the Brambles Transport
Group; Chief Financial Officer of CHEP Australia; Operations Manager for Wreckair Hire; and executive
roles in the CHEP Australia business responsible for sales, asset management and business
development. Phillip is an Ambassador for the National Association for Women in Operations
(NAWO). He holds a Bachelor of Economics and a Master of Logistics Management, both from the
University of Sydney, and is a graduate of the Australian Institute of Company Directors.
Patrick Bradley Group Senior Vice President, Human Resources
Joined Brambles in 2018 as Group Senior Vice President, Human Resources. Before joining Brambles,
Patrick was the Human Resources Director at BT Group, the UK’s largest fixed communications
network, responsible globally for employee relations, reward, pensions, organisational design and
efficiency. Prior to that, he was the Chief Human Resources Officer at EE, the UK mobile
telecommunications operator, when it was acquired by BT. He has also held human resources
leadership roles at Lloyds Banking Group and Atos Origin. He has led multiple workforce and human
resources programmes to improve customer service capabilities, organisational culture and employee
engagement. He holds a Bachelor of Law from the University of Leeds.
David Cuenca President, CHEP Europe
Joined Brambles in 2000 and was appointed President, CHEP Europe in 2020. At Brambles, David has
held several leadership roles, ranging from Country General Manager of CHEP in Central Europe;
Vice President and Country General Manager in CHEP Spain and Portugal; Vice President of
CHEP Southern Europe; President, CHEP Latin America; and his current role in Europe. David holds a
Business Studies degree from the University of Barcelona. He has also completed a General
Management Programme at the IESE Business School.
42
Board & Executive Leadership Team
Board & Executive Leadership Team – continued
Paola Floris President, CHEP Latin America
Joined Brambles in 2001 and was appointed President, CHEP Latin America on 1 July 2020. During her
time at Brambles, Paola has held several leadership roles, ranging from Customer Service Director,
CHEP Italy and progressed to become Retail Director in 2009. Paola was appointed as Country
General Manager, CHEP Italy in 2013 and was promoted to Vice President and Country General
Manager, CHEP Pallets Canada in 2016. Paola has a degree in Economics from the Universita’
Cattolica del Sacro Cuore, and a Master of Business Administration from SDA Bocconi.
Robert Gerrard Group Vice President, Legal and Secretariat
Joined Brambles in 2003 as Senior Counsel, Brambles Group. He was appointed Group Company
Secretary in February 2008 and Group Vice President, Legal and Secretariat in February 2017. Prior to
joining Brambles, Robert was General Counsel and Company Secretary of Roc Oil Company Limited;
Group Legal Manager, Cairn Energy plc; General Counsel and Company Secretary of Command
Petroleum Limited; and a solicitor and senior associate with Allen Allen & Hemsley. He holds a Master
of Law from the University of Sydney and a Bachelor of Science and a Bachelor of Law from the
University of New South Wales. He is a Solicitor of the Supreme Court of New South Wales.
Alasdair Hamblin Senior Vice President, Strategy and Innovation
Joined Brambles in March 2018 as Senior Vice President, Group Strategy and became Senior Vice
President, Strategy & Innovation in February 2019. Prior to Brambles, Alasdair held a number of
leadership roles at General Electric from 2011 to 2018, including Strategic Marketing Director for GE
Oil & Gas and led revenue synergies for its merger with Baker Hughes to form BHGE. He was
previously an Associate Partner at McKinsey & Company and began his career in systems engineering
with Accenture. He holds an MA in Modern History from Balliol College, Oxford, and a Master of
Business Administration from INSEAD.
Rodney Hefford Chief Information Officer
Joined Brambles in June 2017 as Chief Information Officer. Before joining Brambles, Rod was Vice
President, Information Technologies and Services at Ball Corporation, where he integrated the IT
elements of Ball’s acquisition of Rexam and led the development of an IT strategy for the combined
entity. Prior to that, he was Group CIO for Rexam and held several CIO roles at Unilever. He holds a
Bachelor of Materials Engineering from Monash University, Australia, and a Master of Business
Administration from Warwick Business School.
Craig Jones Chief Transformation Officer
Joined Brambles in December 2017. He was appointed Chief Transformation Officer in July 2021 to
deliver on our transformation opportunities and build a culture and capability to support continuous
business improvement. Craig previously held the positions of Vice President, EMEA Emerging Markets
and President CHEP IMETA (India, Middle East, Turkey and Africa). Before joining Brambles,
Craig worked for Rexam plc, a UK listed consumer packaging company. Craig led the Africa,
Middle East & Asia region for Rexam and also spent time leading their Russian business. Craig joined
Rexam in 2001 and held a number of senior finance roles across a variety of geographies. Craig holds
a BA (Hons) Business Studies from Cardiff University and is a Fellow (FCMA) of the Chartered Institute
of Management Accountants.
43
Board & Executive Leadership Team
Board & Executive Leadership Team – continued
Helen Lane Chief Data and Digital Officer
Joined Brambles in 2003. She was appointed Chief Data and Digital Officer on 1 July 2021. During her
time at Brambles, Helen has held several leadership roles in business functions including Finance,
Commercial, Logistics, Asset Productivity and Retail. Helen was appointed Vice President, CHEP
Northern Europe in December 2016 and since 2019 has led the digital transformation of Brambles to
increase asset capabilities and drive value for our customers. Helen holds a BA (Hons) English and
French from University of Leeds. She is also a graduate of the INSEAD Business School.
Laura Nador President, CHEP North America
Joined Brambles in 2003. Laura became President, CHEP North America in January 2018, after holding
a number of leadership positions within Brambles across multiple geographies. Laura was successively
Director, Distributor Sales, CHEP Europe; Vice President, RPCs, Europe; Country General Manager,
CHEP Spain and Portugal; and Vice President, Supply Chain, CHEP Latin America. In July 2016, she was
appointed Senior Vice President of the CHEP USA Pooled Pallets business and then President, CHEP
USA in March 2017, when she took on additional responsibilities for all pallets and containers
businesses in the USA. CHEP Canada was added to her responsibilities in January 2018. Prior to
Brambles, Laura worked for a number of years at the Fortune 500 logistics company, Ryder. Laura
holds a Master of Engineering from the University of Buenos Aires and a Master of Business
Administration from the London Business School.
Nessa O'Sullivan Chief Financial Officer
(See biography on page 40.)
Sarah Pellegrini Vice President, Internal Communications
Joined Brambles in 2018 to lead Group-wide internal communications and was appointed to the
Executive Leadership Team in 2019. Before joining Brambles, Sarah oversaw employee
communications for Qantas’ global operations, and has held corporate communications roles in
international businesses including Arrium and Foster’s Group in Australia and Rexam plc, SABMiller
and BBC Worldwide in the UK. Sarah began her career as a journalist for News Limited after gaining a
Bachelor of Arts (Journalism) from RMIT University.
44
Board & Executive Leadership Team
Directors’ Report – Remuneration Report
Executive Summary
This report outlines the remuneration for Brambles’ Key Management Personnel (KMP) for the financial year ended 30 June 2021
(the Year). It should be read in conjunction with the information provided on Brambles' results and continued execution of
Brambles' business strategy, as detailed in the Operating & Financial Review on pages 8 to 37.
Annual Short-Term Incentive
Based on performance against the corporate and personal objectives set for the Year, the annual Short-Term Incentive (STI) for
Executive KMP (see Section 1) ranged from 107% to 116% of Target. Half of the STI is paid as STI share awards deferred for two
years from grant date. These STI outcomes were driven by Brambles’ financial performance, each Executive KMP’s achievement
of specific personal objectives and after consideration of Executives’ adherence to the Brambles Code of Conduct, shared values
and risk appetite.
Long-Term Incentive
The Long-Term Incentive (LTI) share awards granted during September 2018 (i.e. in FY19) had a three-year performance period
ending 30 June 2021. Performance against the vesting conditions to which they were subject were:
-
-
Brambles’ total shareholder return (TSR) was ranked at 47 out of the ASX100 peer group, resulting in 57.07% vesting for
this component (25% of LTI grant); and ranked at 53 out of the MSCI peer group, resulting in 0% vesting for this
component (25% of LTI grant); and
Brambles' sales revenue compound annual growth rate (CAGR) was 6.6% and Return on Capital Invested (ROCI) was
19.1%, resulting in 100.0% vesting for this component (50% of LTI grant).
Accordingly, 64.3% of total LTI awards granted in FY19 vested. Details of LTI vesting are provided in Section 4.3.2.
Executive Leadership Team Base Salaries and Non-Executive Director fees
The base salaries of the Executive KMPs and other members of the Executive Leadership Team (ELT) were determined in
accordance with the Company's Remuneration Policy described in Section 2. The Company took proactive steps during FY21
to manage costs in an uncertain pandemic environment. Accordingly, there were no salary increases in FY21, with the
1 January 2021 salary increases deferred until 1 July 2021. Therefore, effective 1 July 2021, the average base salary increase for
Executive Directors was 2.1%. The average increase for other ELT members effective from 1 July 2021 was 2.8%, ranging from
0% to 7.7%. Executive KMP salaries are set out in Section 5.
There has been no increase in the Chair and Non-Executive Director base fees since 1 July 2016. There will be no increase in
fees for the Chair or Non-Executive Directors for FY22. Non-Executive Director fees are detailed in Section 7.1. The next fee
review will be carried out for FY23. Any fee increase arising from that review will take effect from 1 July 2022.
Remuneration Strategy
The Remuneration Committee carries out annual reviews of Brambles’ remuneration strategy, structure and policy, including
share-based incentive plans. These reviews are undertaken in order to determine whether the current approach continues to
strongly align executives' interests with those of the Company and its shareholders. A key focus of the annual review is to
provide confirmation that the Company's remuneration structure and policy continue to provide alignment with the
Company's strategic and business objectives, as well as Brambles' Code of Conduct, shared values and risk appetite. In March
2021, the Committee determined that no changes to the current LTI structure or policy were required in FY22, but it approved
changes to streamline the FY22 STI plan (see Section 2.1 for details). An update of Brambles’ strategy over the coming years
arising from the Company’s current project to accelerate its Shaping Our Future initiatives will be announced to the market on
13 and 14 September 2021. In 2022, the Board will consider whether the changes to the LTI plan are necessary given the
updated business strategy.
Impact of COVID-19
Throughout FY21 there were no material levels of COVID-19 related furlough and the Company did not seek nor accept any
COVID-19 related government grants. The STI outcomes for the Year reflect business performance against targets set at the
commencement of the Year. The Board has not exercised any discretion in relation to STI outcomes, nor LTI vesting, as a result
of the economic impact of COVID-19 on Brambles.
Contents
1. Background
2. Remuneration Policy and Framework
3. Remuneration Structure
4. Performance of Brambles and Remuneration Outcomes
5. Executive Key Management Personnel (Executive KMP)
6. Employee Share Plan
7. Non-Executive Directors’ Disclosures
8. Remuneration Governance
9. Other Reporting Requirements
45
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Background
This Remuneration Report provides information on Brambles’ Remuneration Policy and the link between that policy and the
Group's business strategy, financial performance and conduct consistent with Brambles’ Code of Conduct, shared values and risk
appetite. This report also provides remuneration information about Brambles’ Key Management Personnel (KMP), who are its:
- Non-Executive Directors as set out in Section 7; and
-
Executive Directors and Group Executives who have authority and responsibility for planning, directing and controlling the
Group’s activities (Executive KMP). The executives who fall within this definition are those set out in Section 5.
In this report, references to the Executive Leadership Team (ELT) include Executive KMP.
This report includes all disclosures required by the Corporations Act 2001 (the Act), regulations made under the Act and the
Australian Accounting Standard AASB 124: Related Party Disclosures. The disclosures required by section 300A of the Act have
been audited. Disclosures required by the Act cover both Brambles Limited and the Group.
Remuneration Policy and Framework
Brambles’ Remuneration Policy, approved by the Board, is to adopt a remuneration structure and set remuneration levels which:
-
-
-
enables Brambles to attract, retain and motivate high-calibre executives and other talent throughout the Company;
fairly and responsibly rewards executives having regard to Brambles’ performance, the performance of executives and the
general remuneration environment; and
aligns:
-
-
executive reward with the creation of sustainable shareholder value; and
executive behaviour with Brambles’ strategic objectives, Code of Conduct, shared values and risk appetite.
Table 3.3.1 sets out how Brambles’ Remuneration Policy is directly linked to the Company’s financial performance, the creation of
shareholder wealth, the delivery of strategic objectives and executive behaviour.
Corporate and personal short-term incentive objectives are agreed at the start of the financial year and approved by the Board
Remuneration Committee (Committee). The Committee reviews progress against the objectives during the financial year and
assesses performance at year end following a detailed review of Group, business unit and individual executive performance. Long-
term incentive performance conditions are set out in the rules of the Brambles Performance Share Plan (PSP).
The Group’s Remuneration Policy is to set target remuneration opportunity around the median level of the comparator group of
companies (set out in the next paragraph) but with upper-quartile total potential rewards for outstanding performance and proven
capability.
Brambles’ global remuneration framework, which applies to all salaried employees, is underpinned by its banding structure. This
classifies roles into specific bands, each incorporating roles with broadly equivalent work value. Pay ranges for each band are
determined under the same framework globally and are based on the local market rates for the roles falling within each band. For
ELT roles, comparative companies used to set pay ranges are major listed companies in the USA, Australia and UK with sales
revenue and market capitalisation between 50% and 200% of Brambles’ 12-month average at year end. This approach provides a
sound basis for delivering a non-discriminatory pay structure, providing equal pay for equal work value, for all Group employees.
Remuneration Strategy Review
Each year, the Committee conducts a review of the Company's remuneration policy to determine that it delivers a remuneration
structure and levels which are consistent with the objectives outlined at the beginning of this Section 2. As a result of the review
carried out in FY21, which was an in-depth review conducted with the Company's external advisor Ernst & Young (EY), no changes
were made to the overall policy but a material streamlining of the STI plan for FY22 was approved by the Committee.
The STI plan changes for FY22 will reduce the number of metrics from seven company metrics plus personal objectives to a
maximum of three financial metrics plus personal objectives. The balance will also shift from 90% on Company and financial metrics
and 10% on personal objectives to 70% on financial metrics and 30% on personal objectives. Financial metrics will be Group and
business unit Underlying Profit and Cash Flow, with personal objectives encompassing Safety, Customer, Asset Productivity, and the
delivery of the company's transformation strategy.
Potential Future Changes to the Remuneration Structure to Support Business Transformation Objectives
Page 13 of the Annual Report refers to the Company’s current project to accelerate its Shaping Our Future initiatives and notes
that an update of Brambles’ strategy over the coming years arising from that project will be announced to the market on
13 and 14 September 2021. In 2022 the Board will consider whether any changes to the LTI plan are necessary, given the updated
business strategy. Detailed consultation with Brambles’ stakeholders will be undertaken in relation to any necessary changes to the
LTI plan to implement that alignment over the next 12 months prior to seeking shareholder approval to any such changes at the
2022 AGM.
46
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Remuneration Structure
Overview
Remuneration is divided into those components not directly linked to performance (Fixed Remuneration) and those components
which are variable and directly linked to Brambles’ financial performance and the delivery of corporate and personal objectives (At
Risk Remuneration). The diagram below summarises the remuneration structure for Executive KMP for the Year.
Year 1
Year 2
Year 3
Year 4
Fixed Remuneration
Base salary, superannuation and
other benefits
Cash
Paid through the Year
STI Award
(At Risk)
Maximum opportunity
150% to 180% of base salary
LTI Share Award
(At Risk)
Maximum opportunity
100% to 130% of base salary
Cash and Shares
1-year performance
period
90% Corporate
objectives
10% Personal objectives
50% Cash paid
50% Share Awards
Deferred 2 years from grant
Share Awards
50% Relative Total Shareholder Return
Holding lock
(Half based on Brambles’ TSR against the ASX 100 constituents and half based on
Brambles’ TSR against the MSCI World Industrials constituents, using 50 companies
either side of Brambles’ rolling 12-month average market capitalisation)
(for awards
FY20 onwards)
50% Sales Revenue CAGR/ROCI matrix
Legend: Cash awarded; Share Awards granted; and Share Awards vested/unrestricted.
Payments are made and awards are granted following the end of the financial year and finalisation of Brambles’ results.
An individual’s At Risk Remuneration is subject to the overarching discretion of the Board and the Committee. That discretion is
informed by how individuals achieve results and the extent to which they exemplify the behaviours expected of them as leaders of
the Company as set out in Brambles’ Code of Conduct, shared values and risk appetite.
The proportion of Executive KMP total remuneration comprising At Risk Remuneration is illustrated in Table 3.4.2.
STI and LTI share awards are governed by the Performance Share Plan (PSP) rules, which have been approved by shareholders. No
Brambles shares were purchased on-market during the Year to satisfy the entitlements of holders of STI share awards or
LTI share awards.
The remuneration structure and the key features of Fixed and At Risk Remuneration are summarised in Table 3.3.1. The application
of the At Risk Remuneration is further described in Section 4.
Basis of valuation of STI and LTI Share awards
The number of share awards granted is based on the market value of Brambles' shares which, under the PSP rules, is the volume
weighted average share price during the five trading days up to and including the grant date. In this report, this is referred to as the
'face value approach'.
Details of the approach are contained in Section 9.4.
47
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Remuneration Structure Details
The Company's remuneration structure is detailed below.
Table 3.3.1: Remuneration Structure FY21
Remuneration
element
Description
Purpose
Link to strategy
Fixed Remuneration
Base salary, superannuation and
other fixed benefits.
Fixed remuneration reflects the
executive’s role, duties, responsibilities
and level of performance, taking into
account the individual's location and
Brambles' size, geographic scale and
complexity. Base salaries are generally
referenced at the market median.
Base salaries are designed to be
competitive to assist Brambles
in attracting and retaining
talented executives.
At Risk Remuneration
STI Award
Executive KMP are eligible to receive annual STI awards.
The Committee approves annual STI corporate and personal objectives for Executive KMP. At the end of each year, the Committee
assesses Executive KMPs’ performance against those objectives. The amount of an STI Award will depend on whether and, if so, to what
extent those objectives are achieved.
Half of the STI award is delivered in cash following the end of the year to which the award relates. The other half is delivered in deferred
STI Share awards which vest two years from the date they are granted, subject to the relevant Executive KMP remaining employed by
the Group at the end of that period. Eligibility for STI awards is also subject to the non-financial risk assessment referred to in this table
below, both at the time of the grant of the awards and, in the case of STI Share awards, during the two-year deferral period.
The achievement of objectives by Executive KMP for FY21 are set out in Section 4.2.
Corporate
Objectives
(comprising 90%
of the STI award)
Corporate objectives are set at a
'Threshold' (the minimum
necessary to qualify for the
awards), 'Target' (when the
performance target is met) and
'Maximum' (when targets have
been significantly exceeded and
the award has reached its upper
limit) level. For Underlying Profit,
'Threshold' levels are set at or
above the prior year's outcome for
the relevant objective, except
where extenuating circumstances
exist.
Corporate objectives are set to align an
executive’s At Risk Remuneration to
Brambles’ financial and strategic
objectives. For FY21, these were:
Underlying Profit growth in excess of sales
revenue growth through the cycle; Free
Cash Flow sufficient to fully fund capital
expenditure; and dividends and
operational efficiency.
Financial objectives are chosen to link
Executives KMPs’ rewards with the
financial performance of the Group, the
pursuit of profitable growth, the efficient
use of capital and generation of cash.
FY21 corporate objectives were:
-
Underlying Profit
provides a focus on
profitable growth;
Cash Flow from Operations
is used as a measure
to provide a strong
focus on the generation
of cash;
Asset efficiency is a key
driver of business
profitability and assists
in maximising revenue
from existing assets and
reducing capital costs;
Executive KMP have a
personal objective safety
measure. The objectives
are zero fatalities and a
specified percentage
improvement in the
Group or applicable
region’s Brambles Injury
Frequency Rate (BIFR) from
FY20 BIFR; and
Customer satisfaction.
-
-
-
-
Personal
objectives
(comprising 10%
of the STI award)
Personal objectives relate to non-
financial operating and strategic
objectives.
Personal objectives provide the
opportunity to tailor individual Executive
KMP performance expectations, having
regard to their role and function, to
specific non-financial operating and
strategic goals.
Personal objectives are linked
to the delivery of Brambles’
strategic and operating
priorities such as asset
protection and efficiency,
digitisation and the Brambles
transformation strategy.
48
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Remuneration
element
Description
Purpose
Link to strategy
LTI Share Award
Executive KMP are also eligible to receive an annual grant of LTI share awards vesting three years from the date the award is granted,
subject to satisfaction of service and performance conditions. A one-year holding lock post-vesting applies to awards granted from
FY20 onwards, during which executives cannot sell vested LTI awards other than to pay any tax obligations. The number of LTI share
awards to which an Executive KMP is entitled is an amount, calculated using the face value approach, equal to a specified proportion of
his or her base salary as shown in Section 4.3.
Relative TSR
(comprising
half of the LTI
award)
Sales revenue
CAGR and ROCI
(comprising half
of the LTI share
award)
Performance is measured over a
3-year performance period
(Performance Period) against
constituents of both the ASX100
and the MSCI World Industrials
indices, with each component
measured separately and
comprising 25% of the total LTI
award.
The vesting schedule for the
portion of the LTI subject to TSR is
outlined below.
TSR
percentile
% Vesting
of shares
Below
Threshold
Below
50th
No vesting
Threshold 50th
50%
Between
Threshold
and
Maximum
Between
50th and
75th
Pro-rata
straight-
line vesting
Maximum 75th and
100%
above
Each year, a sales revenue
CAGR/ROCI matrix is set by the
Committee for each LTI share
award, based on targets approved
by the Board. This allows the
Committee to set targets for each
LTI share award that reward strong
performance in light of the
prevailing and forecast economic
and trading conditions.
The FY22-24 sales revenue
CAGR/ROCI matrix, pertaining to
the LTI share awards to be granted
in October 2021, is set out in
Section 4.3. The sales revenue
CAGR/ROCI targets have been
established based on the
company's 3-year strategic plan.
TSR provides a direct alignment
of executive rewards to the
creation of shareholder value
through linking executive
reward with the long-term
generation of returns to
Brambles’ shareholders.
Relative TSR rewards the creation of
shareholder value.
TSR measures the returns that a company
has provided for its shareholders,
reflecting share price movements and
reinvestment of dividends over a specific
period.
A relative TSR performance condition
means that value is only delivered to
participants if the investment return
received by Brambles’ shareholders is
sufficiently high relative to the return they
could have received by investing in a
portfolio of alternative stocks over the
same period.
This portion of the LTI share award
incentivises both long-term sales revenue
growth and ROCI. Vesting is based on
achievement of sales revenue targets with
three-year performance targets set on a
CAGR basis. The sales revenue growth
targets are underpinned by ROCI hurdles.
This is designed to drive profitable
business growth, to maintain quality of
earnings and to deliver a strong Return on
Capital Invested. Sales revenue CAGR is
measured in constant currency.
Profitable growth is emphasised
by the use of sales revenue
CAGR targets with ROCI hurdles
as the performance conditions
that must be satisfied for half of
all LTI share awards to vest.
This supports the delivery of
sustainable returns to
shareholders.
49
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Minimum
shareholding
requirements
Brambles
requires ELT
members to hold
a meaningful
stake in the
Company to
assist in aligning
their interests
with those of its
shareholders.
Description
The minimum shareholding requirement for the CEO is 150% of base salary and for the other ELT members is 100%
of their respective base salaries, to be built up over five years. Each year, the Committee receives a report on the
progress towards the attainment of the required minimum shareholding requirement.
Whilst building their minimum shareholding requirement, ELT members are not permitted to sell Brambles' shares,
other than to pay tax obligations they incur by reason of STI or LTI share awards vesting, until they have achieved
100% of their shareholding requirements.
Where Executive Directors step down from their Executive Director position but continue to be employed by the
Company, they will, under the Company's Securities Trading Policy, need the Chair’s approval to sell or otherwise
deal in Brambles' shares.
Executive Directors who cease to be employees of the Company are required to retain at least 50% of their
minimum shareholding for the 12 months following their cessation of employment.
Clawback of
awards
Description
Clawback
provisions
operate in
relation to
STI and LTI share
awards
Under the PSP rules, the Board has discretion to reduce, cancel or lapse unvested or vested STI or LTI share awards
in the circumstances set out in the PSP rules (a copy of the rules is on the Employee Share Plans page of the
Corporate Governance section of the Brambles website). These circumstances include to protect the financial
soundness of the Group, an exceptional event which has a material impact on the value of the Group, a material
inaccuracy in the assessment of the performance of a participant in the PSP (including an Executive KMP) or any
subsequent or adverse development regarding the personal performance of such a participant.
Remuneration
Committee
discretion
Remuneration
Committee
discretion
regarding At Risk
Remuneration
Description
The Committee has discretion to adjust the level of At Risk Remuneration (both STI and LTI awards) based on the
financial or share price performance of the Company and the behaviours exhibited by individual ELT members,
including their adherence to the Company’s Code of Conduct, shared values and risk appetite.
The Committee may, at its discretion, reduce the amount of an ELT member’s STI award (regardless of the
achievement of corporate or personal objectives) where his or her performance or behaviour during the year has
been assessed as not warranting all or part of an incentive payment to which he or she may otherwise be entitled.
The Committee determines the level of LTI share award vesting following the receipt of independent TSR analysis
and audited management reports on the outcome of the sales revenue CAGR/ROCI performance over the
applicable Performance Period. The Committee’s discretion can be used to increase or decrease vesting outcomes,
which includes reducing vesting to zero.
The Remuneration Committee adopted a principles-based approach to non-financial risk, with a framework which
provides guidelines as to the types of events that may warrant an adjustment and guidance on what should be
considered by the Committee. Advice is provided to the Committee by the Chair of the Audit & Risk Committee,
the Group Senior Vice President, Human Resources; the Group Vice President, Legal and Secretariat; and
Group Vice President, Risk & Internal Audit on any major or severe incidents to be considered by the Committee
when deciding whether to exercise its discretion to adjust any year end remuneration outcomes.
50
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Remuneration Mix for Executive KMP
Brambles’ Executive KMP remuneration mix is linked to performance. At Risk Remuneration represents 71% to 76% of Executive
KMP maximum remuneration package.
The table below illustrates the remuneration potential for the Executive KMP, including Threshold, Target and Maximum potential.
Table 3.4.1 Remuneration Potential
Remuneration potential
CEO/CFO potential
as % of base salary
President North America/Europe
potential as % of base salary
STI Awards1
LTI Awards
Threshold
60%
46%
Target
120%
88%
Maximum
Threshold
180%
130%
50%
35%
Target
100%
68%
Maximum
150%
100%
The following table illustrates the level of actual remuneration received by Executive KMP compared with their respective total
remuneration potential.
The respective columns labelled 'Actual' comprise:
-
-
-
Base salary: base salary for FY21;
STI awards: the STI award received in respect of FY21 performance, half of which was delivered as deferred STI share awards
which vest in FY23 (see Section 4.2); and
LTI shares: the proportion of the FY19-FY21 LTI share awards that vested at the end of the Year (see Section 4.3.2).
The Remuneration Mix represents the maximum potential value of each element of the respective Executive KMP’s remuneration
package mix that could be received in each case by the individual Executive KMP.
Table 3.4.2 Remuneration Mix
Remuneration mix
Base salary
STI Award
LTI Award
Total
Cash/Equity balance
Remuneration mix
Base salary
STI Cash
STI Share Award
LTI Share Award
Total
Remuneration mix
Cash potential
Equity potential
Total
CEO/CFO
maximum
potential
24%
44%
32%
100%
CEO Actual
CFO Actual
President
North America/
Europe maximum
potential
President
North America
Actual
President Europe
Actual
24%
33%
20%
77%
24%
33%
20%
77%
29%
42%
29%
100%
29%
32%
18%
79%
29%
30%
5%
64%
CEO/CFO maximum potential
President North America/ Europe maximum potential
24%
22%
22%
32%
100%
29%
21%
21%
29%
100%
CEO/CFO maximum potential
President North America/ Europe maximum potential
46%
54%
100%
50%
50%
100%
1 Half of the STI Award is delivered in deferred STI Share awards, which vest two years from the date they are granted subject to the relevant Executive KMP remaining
employed by the Group at the end of that period.
51
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Directors’ Report – Remuneration Report – continued
Brambles’ Five-Year Performance and Remuneration Outcomes
The table below sets out the dividends paid, Brambles' share price at the beginning and the end of the financial year, the financial
performance conditions for the STI and LTI share awards and the Company’s performance for continuing operations for the period
FY17 to FY21 and the STI and LTI award outcomes for those years. In the following table:
-
-
-
-
-
-
financial measures relating to Kegstar are included in FY17 to FY19, but due to its divestment, not in FY20 and FY21;
financial measures relating to IFCO are included in FY17, but due to its divestment, not in FY18 to FY21;
the periods prior to FY20 have not been restated for the impact of new accounting standard AASB 16 Leases;
the periods prior to FY18 have not been restated for the impact of the new accounting standards AASB 9 Financial Instruments
and AASB 15 Revenue from Contracts with Customers;
the Underlying Profit and Cash Flow targets and outcomes for STI purposes are adjusted figures based on budgeted FX rates
at the commencement of the respective financial year; and
financial measures related to the CHEP Recycled, Oil & Gas and Aerospace businesses have not been included in any period
due to the divestment of these businesses.
Definitions for the financial metrics are provided in the Glossary on pages 137 to 139.
The numbers shown below reflect Brambles’ financial statements for the applicable year and STI outcomes as reported in those
years.
Dividends (cents per share)2
Share price (A$): at 1 July
Share price (A$): at 30 June
STI and LTI financial measure (US$m)
BVA3
STI financial measures (US$m)
Underlying Profit4
Cash Flow from Operations5
Group Free Cash Flow6
Profit after tax7
STI outcome range
for Executive KMP (% base salary)8
STI outcome range for Executive KMP
(% of Target)
LTI measures
Sales Revenue (US$m)
ROCI9
3-year TSR
LTI outcome (% of grant)10
FY21
FY20
US$0.205
US$0.18
10.89
11.44
12.75
10.87
FY19
A$0.29
8.88
12.88
FY18
A$0.29
9.73
8.88
FY17
A$0.29
12.32
9.73
-
-
-
-
235.1
879.3
901.1
622.0
535.0
799.4
754.8
462.2
508.0
803.7
431.8
238.5
454.1
826.1
724.8
554.4
553.5
957.5
591.5
224.2
444.9
108% - 136%
62% - 112%
48% - 120%
40% - 122%
42% - 116%
107% - 116%
62% - 112%
48% - 99%
40% - 102%
41% - 97%
5,209.8
18%
26.36%
64%
4,717.9
17%
21.41%
89%
4,595.3
19%
6.94%
0%
4,470.3
20%
-7.53%
25%
5,104.3
17%
16.81%
20%
2 Effective from 2020, Brambles changed to a payout ratio-based dividend policy, with the dividend per share declared in US cents and converted and paid in
Australian cents. Prior to 2020, dividends were declared and paid in Australian cents. The Australian dollar equivalent of the FY21 dividend of US$0.205 per share is
A$0.27 per share. The Australian dollar equivalent of the FY20 dividend of US$0.18 per share is A$0.26 per share.
3 LTI and STI measure in FY17, calculated at fixed 30 June 2016 exchange rates.
4 Underlying Profit used as an STI measure during plan years FY18 to FY21.
5 Cash Flow from Operations used as an STI measure during plan years FY17 to FY21.
6 Group Free Cash Flow used as an STI measure during plan year FY18. Free Cash Flow includes cash flows from divested businesses.
7 Profit after tax used as an STI measure during plan year FY17. FY17 includes IFCO and is consistent with previously published data. Refer to Five-Year Financial
Performance Summary on page 136.
8 The range of outcomes for Executive KMP is provided, as some Executive KMP had Business Unit financial performance conditions as well as Group conditions.
Financial measures comprised 70% of total STI outcome in FY17, 80% of total STI outcome in FY18 to FY20 and 90% of total STI outcome in FY21. The balance
comprised personal objectives. The amount includes STI cash and STI share awards. The STI share awards are deferred for two years from grant date.
9 ROCI used as an LTI measure during plan years FY18 to FY21.
10 LTI outcome is for the Performance Period ending in the relevant year. For example, the FY21 LTI outcome relates to the FY19 to FY21 Performance Period.
52
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Performance of Brambles and Remuneration Outcomes
FY21 STI Awards
The following table summarises the components and weighting of objectives for the FY21 STI awards for Executive KMP:
Corporate objectives
Group
Profit
Leverage
Segment
Underlying
Profit
Group
Cash Flow
Segment
Cash Flow
Asset
Efficiency
Safety
Customer
Personal
Objectives
20%
20%
25%
25%
15%
7.5%
-
7.5%
10%
10%
10%
10%
10%
10%
10%
10%
Executive KMP
CEO, CFO
Presidents
North America / Europe
Executive KMP personal objectives for FY21 are shown in the table below. Recommended targets for global metrics relating to
business strategy and growth objectives are set at the Group level and reviewed and approved by the Committee.
Metric
Measurement
Business strategy
and growth objectives
Objectives are set for each Executive KMP which support and are aligned with the achievement of
Brambles' overall business strategy and Business Unit objectives.
FY21 objectives included: asset protection and efficiency; digitisation; and the Strategic Review.
Quantitative metrics for achievement of each of these objectives are set, which allows the Committee
to determine objectively whether they have been met.
STI Plan Structure and Performance
As detailed in Table 3.3.1, the STI Plan comprises Corporate Objectives and Personal Objectives, all components of which are
assessed against their respective performance targets to provide an overall assessment.
The STI metrics comprise the following:
Metric
Weighting
at Target
Payment schedule
Underlying Profit
25%
12.5% at Threshold; 25% at Target; 37.5% at Maximum
A sliding scale between the Threshold and Target, with a separate sliding scale
between Target and Maximum.
Group Profit Leverage
20%
10% at Threshold; 20% at Target; 30% at Maximum
A sliding scale between the Threshold and Target, with a separate sliding scale
between Target and Maximum.
Cash Flow
15%
7.5% at Threshold; 15% at Target; 22.5% at Maximum
A sliding scale between the Threshold and Target, with a separate sliding scale
between Target and Maximum.
Asset Efficiency
10%
5% at Threshold; 10% at Target; 15% at Maximum
The targets are all-or-nothing; there is no sliding scale between Threshold, Target
and Maximum.
Safety
10%
5% at Threshold; 10% at Target; 15% at Maximum
A sliding scale between the Threshold and Target, with a separate sliding scale
between Target and Maximum.
Customer
10%
5% at Threshold; 10% at Target; 15% at Maximum
Personal Objectives
10%
A sliding scale between the Threshold and Target, with a separate sliding scale
between Target and Maximum.
Personal Objectives are individually assessed by the Board Chair, reviewed by the
Committee and approved by the Board in relation to the CEO’s STI. Personal Objectives
of the other Executive KMP (and all ELT members) are approved by the Committee.
5% at Threshold; 10% at Target; 15% at Maximum. A sliding scale operates between
the Threshold and Target, with a separate sliding scale between Target and Maximum.
53
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The following table outlines performance against Brambles' Group Financial STI metrics against the targets shown.
Brambles' Group Financial STI Metrics
Metric
Performance
Underlying
Profit
Result reflects strong sales revenue growth, including both pricing and volume
growth, as well as increased surcharge income driven by the recovery of input
cost increases.
The result reflects Underlying Profit leverage in the Year, with strong returns on
efficiency investments combined with the effective management of operational
cost increases, including the impact of COVID-19, Brexit and material inflationary
cost pressures.
Group Profit
Leverage
Underlying Profit growth was 1% in excess of sales revenue growth. Operating
cost increases were more than offset through a combination of pricing and
surcharge initiatives (including surcharges in North America), disciplined cost
control and supply chain efficiency benefits.
Cash Flow from
Operations
Strong cash flow performance, driven by earnings growth, increased
compensations and working capital improvements offset by higher capital
expenditure mainly driven by lumber inflation.
Outcome
Between Target and
Maximum
Achieved Target
Above Maximum – excluding
the impact of timing benefits
of US$180m relating to
deferred pallet purchases
Asset Efficiency Despite asset efficiency improvements outside of the US, the overall asset
Below Threshold
efficiency measure of capex spend to sales ratio did not deliver improvement
during the year due to the combined impact of lumber inflation driving a
material increase in pallet prices and lower pallet recoveries in the US. Outside of
the US, longer pallet cycle times due to increased stock holdings were largely
offset by asset efficiency gains.
Other Brambles' Group metrics
Metric
Performance
Safety
Safety performance is measured by Brambles Injury Frequency Rate (BIFR). Results at
Group level reflect a continuing focus on Safety improvement across all business units
globally, with major improvements in BIFR outcomes being achieved in the North
America business,
in particular, over the course of FY21.
Customer The Customer metric was measured based on a reduction of detractor customers at Q4
2020 and supported by a plan to substantially increase customer participation in NPS
surveys. Overall, the results were very good, with an above Target performance in
aggregate across the Group.
Outcome
Achieved Target
Between Target and
Maximum
The STI outcomes for the CEO and CFO are shown below based on performance against their STI objectives. As indicated earlier in
this report, half of the STI award is delivered in deferred STI share awards, which vest two years from the date of grant, subject to
the applicable Executive remaining employed by the Group at the end of that period.
54
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CEO and CFO FY21 STI Performance
Performance Category
Weighting
at target
STI as %
of base
salary
Threshold
Target
Maximum
Outcome
Outcome as
% of base
salary
Underlying Profit (US$)
25%
30%
778.7m
810.0m
850.5m
840.3m
41.2%
Group Profit Leverage
20%
24%
+0.1%
+1.0%
+2.0%
+1.0%
24%
(% Underlying Profit
growth is higher than sales
revenue growth)
Cash Flow from Operations
(US$)
15%
18%
495.3m
521.3m
547.4m
846.2m
27%
Asset Efficiency
10%
12%
18.3%
17.5%
16.6%
20.8%
0%
Customer
10%
12%
16.7%
33.0%
50.0%
40.0%
14.5%
Safety
10%
12%
5.5
5.0
4.6
5.0
12%
CEO Personal Objectives
10%
12%
5%
10%
15%
CEO Total
100%
120%
CFO Personal Objectives
10%
12%
5%
10%
15%
CFO Total
100%
120%
Achieved
Maximum
18%
Achieved
Maximum
136.7%
18%
136.7%
In addition to the Brambles STI metrics shown above relating to Underlying Profit, Group Profit Leverage and
Cash Flow from Operations, the business unit targets and their respective personal objective outcomes for the
Presidents of North America and Europe, were as follows:
Business Unit Metrics
Business Unit
Outcome
Achievement vs. Target
President, North America
CHEP North America Underlying Profit
Above Maximum
CHEP North America Cash Flow
Above Maximum
CHEP North America Asset Efficiency
Below Threshold
CHEP North America Customer
Target
107%
134%
-
100%
CHEP North America Safety
Above Maximum
10% better than Target
Personal Objectives
President, Europe
Between Target and Maximum
CHEP Europe Underlying Profit
CHEP Europe Cash Flow
CHEP Europe Asset Efficiency
Above Maximum
Above Maximum
Below Threshold
CHEP Europe Customer
Between Target and Maximum
CHEP Europe Safety
Personal Objectives
Below Threshold
Between Target and Maximum
110%
109%
138%
-
112.5%
-
150%
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Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Actual STI Payable and Forfeited for FY21
Details of the STI award payable to Executive KMP and the STI award forfeited, as a percentage of the maximum potential STI award
in respect of performance during the Year, are shown in the following table.
Name
G Chipchase
N O’Sullivan
D Cuenca
L Nador
Actual STI payable
as % of base salary
Maximum STI as
% of base salary
Total STI payable
(US$)
% of maximum
STI payable
% of maximum
STI forfeited
137%
137%
107%
116%
180%
180%
150%
150%
2,205,917
1,232,501
465,694
530,120
76%
76%
72%
77%
24%
24%
28%
23%
Executive KMP LTI Share Awards
Executive KMP are eligible to receive an annual grant of LTI share awards. The awards are made in October each year. The
performance conditions to which LTI share awards are subject are set out in Table 3.3.1. The number of LTI share awards to which
an Executive KMP is entitled is an amount calculated as follows:
[Base salary in A$ at 1 July] x [LTI % in the table below] divided by
[Share Price calculated using the face value approach] = number of LTI Share Awards
Role
CEO/CFO
President North America/Europe
LTI grant as % of base salary
130%
100%
Sales Revenue CAGR/ROCI LTI Performance Matrix for FY22-FY2411
The sales revenue CAGR/ROCI matrix for LTI share awards that will be made in October 2021 for the period FY22-FY24 is set out
below. The sales revenue and ROCI components of the matrix are calculated on a Group basis. The prospective vesting date is in
October 2024. ROCI is defined as Underlying Profit divided by Average Capital Invested.
FY22-24 Sales Revenue CAGR/ROCI LTI Performance Matrix Vesting Schedule
Sales Revenue CAGR1122
4%
5%
6%
7%
8%
15.5%
-
20%
40%
60%
80%
ROCI %
17.0%
20%
40%
60%
80%
100%
18.5%
60%
80%
100%
100%
100%
As a policy principle, the Committee takes into account major acquisitions, divestments, impairments and Significant Items during
the applicable Performance Period in determining the final outcome of the sales revenue CAGR/ROCI matrix for that period.
Acquisitions or divestments that are not material to the overall outcome are excluded from any performance assessment.
The ROCI outcome is the average ROCI over the Performance Period and is calculated by adding each year's ROCI result and
dividing that sum by three.
The matrix continues to provide an appropriate balance between growth and returns well in excess of the cost of capital.
11 Financial targets set for STI share awards do not constitute profit forecasts and the Board is conscious that their publication may therefore be misleading. Accordingly,
Brambles does not publish in advance the coming year’s financial targets for STI awards.
12 Three-year compound annual growth rate (CAGR) over base year.
56
Directors’ Report – Remuneration Report
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Performance Testing of LTI Share Awards Under the Performance Share Plan
The Performance Period for LTI awards granted in October 2018 expired on 30 June 2021. The TSR component of these awards was
tested against the TSR performance of Brambles over the Performance Period as determined by an independent consultant. The
sales revenue CAGR and ROCI components of these awards were audited by Brambles’ external auditors and then tested against
the FY19-FY21 matrix by the Committee. No adjustments were made to the targets as a result of COVID-19. The Committee also
undertook the non-financial risk assessment outlined in Table 3.3.1 and, based on that assessment, determined that no adjustment
to the vesting levels for any Executive KMP was required. Based on those assessments, these awards vested as follows:
Performance condition
Performance Period
Performance condition
Vesting level
Relative TSR (ASX100)
1 July 2018 to 30 June 2021
Brambles’ TSR performance against the ASX 100 TSR
57.07%
Relative TSR (MSCI)
1 July 2018 to 30 June 2021
Brambles’ TSR performance against the MSCI Industrials
Sales Revenue
CAGR/ROCI
1 July 2018 to 30 June 2021
CAGR: 6.6%
ROCI 19.1%
Total LTI vesting
1 July 2018 to 30 June 2021
Executive KMP Remuneration and Benefits for the Year
0%
100%
64.3%
The purpose of the table below is to enable shareholders to understand the actual remuneration received by Executive KMP. The
table provides a summary of the actual remuneration, before equity, received or receivable by the Executive KMP for the Year,
together with prior year comparatives. Income derived from the vesting of STI and LTI share awards during the Year has been
included below as 'Actual share income'. The value shown is the market value at the time the income became available to the
Executive. These share awards were granted in prior financial years and vested in October 2020.
Theoretical accounting values for unvested share awards are shown in Section 9.1. Those values are a statutory disclosure
requirement. Unvested share awards may result in 'Actual share income' in future years and, if so, the income will be reported in the
table below in the Remuneration Report for the relevant year.
There were no loans or other transactions with any Executive Directors or Executive KMP during the Year.
US$'000
Short-term employee benefits
Post-
employment
benefits
Name
Year
Executive Directors
Cash /
salary /
fees1133
Non-
monetary
benefits1144
Cash
bonus
Super-
annuation
G Chipchase
FY21
1,880 1,103
N O'Sullivan
Other Executive KMP
D Cuenca
L Nador
Totals 16
FY20
FY21
FY20
FY21
FY20
FY21
FY20
1,726
1,061
975
702
616
407
442
233
-
479
467
-
265
255
FY21
3,862 2,217
FY20
3,168
1,364
4
2
16
10
14
-
9
3
43
15
-
-
-
-
34
-
69
58
103
58
Other
Termination
/ sign-on
payments
/ retirement
benefits Other1155
Total
before
equity
Actual
share
income
STI / LTI /
MyShare
awards
Total
-
-
-
-
-
-
-
-
-
-
6
10
1
1
16
-
20
19
43
30
2,993
2,403
2,440
232
1,694
1,379
1,393
194
739
-
842
802
76
-
430
33
5,396
2,672
3,073
1,587
815
-
1,272
835
6,268
4,288
10,556
4,635
459
5,094
13 Cash/Salary/Fees includes base salary and allowances.
14 Non-monetary benefits include annual medical assessment and tax support.
15 Other includes health and salary continuance insurance.
16 The year-on-year comparison of remuneration is affected by the movement of 30 June 2021 rates from A$1=US$0.6692, €1=US$1.1064 and £1=US$1.2582 for FY20
to A$1=US$0.7477, €1=US$1.1959 and £1=US$1.3538 for FY21.
57
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Executive Key Management Personnel (Executive KMP)
Executive Key Management Personnel Changes
There were no changes to Executive Directors during the Year, namely Graham Chipchase (Chief Executive Officer) and Nessa
O’Sullivan (Chief Financial Officer).
In addition to Brambles’ Executive Directors, the following executives comprise the Year’s Executive Key Management Personnel:
Laura Nador, President, CHEP, North America; and
-
- David Cuenca, President, CHEP Europe.
Service Contracts
Graham Chipchase and Nessa O’Sullivan are on continuing contracts, which may be terminated without cause by the employer
giving 12 months’ notice or by the employee giving six months’ notice, with payments in lieu of notice calculated by reference to
annual base salary.
David Cuenca and Laura Nador are on continuing contracts, which may be terminated without cause by the employer giving six
months’ notice or by the employee giving six months’ notice, with payments in lieu of notice calculated by reference to annual
base salary.
These standard service contracts state that any termination payments made would be reduced by any value to be received under
any new employment and are subject to limits imposed under Australian law.
Details of Executive KMP salaries are shown in Table 5.2.1.
Contract Terms for Executive KMP
Name and role(s)
Base salary at 30 June 2020
Base salary at 1 July 2021
Notice period
G Chipchase, Chief Executive Officer
GBP 1,192,000
GBP 1,216,000
N O'Sullivan, Chief Financial Officer
L Nador, President, North America
D Cuenca, President, Europe
GBP 666,000
USD 457,000
EUR 362,500
GBP 681,000
USD 492,000
EUR 384,500
12 months
12 months
6 months
6 months
Mr Chipchase and Ms O’Sullivan received increases reflective of market movement in the UK.
Ms Nador’s and Mr Cuenca's increases reflected both market movement and their additional experience in the role.
All increases were effective 1 July 2021.
Employee Share Plan
Brambles' employee share plan, MyShare, was launched in October 2008 and was developed as a vehicle to encourage share
ownership and retention across the Group. Employees may buy up to A$6,000 of shares each year (Acquired Shares), which the
Company matches (Matching Shares) on a one-for-one basis after a two-year qualifying period. The vesting and automatic exercise
of Matching Shares occurs on the second anniversary of the first acquisition.
In 2020, MyShare was offered in an additional 19 countries. Together with the previous 41 countries where it operated, MyShare is
now a global all-employee share plan. For the 2020 MyShare plan onwards, all permanent employees of Brambles, in any country of
the world, will be eligible to join the plan.
As of 30 June 2021, 4.6 million Brambles shares were held by 4,178 MyShare participants.
Executive KMP are eligible to participate in MyShare. Shares obtained by Executive KMP through MyShare are included in
Section 9.6. Matching Shares allocated but not yet vested are shown in Sections 9.5 and 9.7.
During the Year, 1,104,368 Brambles shares were purchased on-market under the MyShare plan, being the Acquired Shares
purchased by participants in that plan, at an average price of A$10.68 per share. The accounting share value at grant ranged from
A$9.26 to A$10.97 (up to 30 June 2021) based on the monthly share price value. For further details of the share grant values, refer
to Section 9.8 of the Remuneration Report and Note 22 of the Financial Report.
Non-Executive Directors’ Disclosures
Non-Executive Directors’ Remuneration Policy
The Chair’s fees are determined by the Remuneration Committee, with the Chair exempting himself from the decision. The other
Non-Executive Directors’ fees are determined by the Chair and Executive Directors. In setting the fees, advice is sought from
external remuneration advisors on the appropriate level of fees, taking into account the responsibilities of Non-Executive Directors
in dealing with the complexity and global nature of Brambles’ affairs and the level of fees paid to Non-Executive Directors in
comparable companies.
All Non-Executive Directors’ fees are set in Australian dollars and paid in local currencies.
Brambles’ base fees for Non-Executive Directors are set with reference to the comparator group of Australian ASX50 listed
companies.
There has been no increase in Chair and Non-Executive Director base fees since 1 July 2016. There will not be any increase in fees
for the Chair or Non-Executive Directors for FY22.
58
Directors’ Report – Remuneration Report Directors’ Report – Remuneration Report – continued
The base fees for the Chair and Non-Executive Directors are as follows:
Chair: A$627,000; and
-
- Non-Executive Directors: A$209,000.
The following travel allowances and Committee member fees were also not increased during the Year:
-
-
-
-
Supplement for members of the Audit and Remuneration Committees: A$25,000. The Board Chair does not receive the
supplement if he or she is a member of either of these Committees;
Supplement for Chair of the Audit & Risk Committee: A$50,000;
Supplement for Chair of the Remuneration Committee: A$40,000; and
Travel allowance of A$5,000 where a meeting involved a long-haul international trip. No travel allowances were paid in FY21.
The next fee review will take effect from 1 July 2022.
Non-Executive Directors’ Appointment Letters
Non-Executive Directors are appointed for an unspecified term but are subject to election by shareholders at the first Annual
General Meeting after their initial appointment by the Board. The Corporate Governance Statement, available on Brambles’ website,
contains details of the process for appointing and re-electing Non-Executive Directors and of the years in which the Non-Executive
Directors are next due for re-election by shareholders.
Letters of appointment for Non-Executive Directors, which are contracts for service but not contracts of employment, have been
put in place. These letters confirm that Non-Executive Directors have no right to compensation on the termination of their
appointment for any reason, other than for unpaid fees and expenses for the period served.
Non-Executive Directors do not participate in the PSP or MyShare plans.
Mr Mullen was appointed to the Board on 1 November 2019 and took over as Chair of the Board from 1 July 2020.
Dr Scheinkestel was appointed to the Board on 1 June 2020. Dr Scheinkestel is a member of the Audit & Risk Committee. On
20 August 2020, she assumed the role of Chair of the Audit Committee (as it was then called). The prior Audit Committee Chair,
Mr Long, retired from the Board upon the conclusion of the Brambles’ Annual General Meeting on 8 October 2020.
Mr McCall was appointed to the Board on 6 July 2020.
Non-Executive Directors’ Shareholdings
Non-Executive Directors are required to hold shares in Brambles, equal to their annual fees after tax, within three years of their
appointment.
The following table contains details of Brambles Limited ordinary shares in which Non-Executive Directors held relevant interests,
being issued shares held by them and their related parties:17
Ordinary shares
Balance at the start of the Year
Changes during the Year
Balance at the end of the Year
Non-Executive Directors as at 30 June 2021
G El-Zoghbi
E Fagan
A G Froggatt
T Hassan
K McCall
J Miller
J Mullen18
S Perkins
N Scheinkestel
Former Non-Executive Director
B Long
35,000
20,000
14,890
15,000
-
5,150
-
20,000
7,134
24,000
-
-
-
-
8,925
4,300
-
-
12,640
-
17 G El-Zoghbi: Held by The George El-Zoghbi Trust Agreement on behalf of George El-Zoghbi.
E Fagan: Held by LG Vestra, Bank of New York Mellon on behalf of Elizabeth Fagan.
A G Froggatt: Of which 7,000 shares are held by Christine Joanne Froggatt and 7,890 shares are held by Anthony Grant Froggatt.
T Hassan: Held by RBC Dexia Custodian on behalf of Tahira Hassan.
K McCall: Held by BNP Paribas Nominees Australia Pty Limited on behalf of Ken McCall.
J Miller: Of which 5,150 shares are held by The Miller Family Revocable Trust on behalf of James Miller and 4,300 shares are held by James Richard Miller.
S Perkins: Held by Perkins Family Super Pty Ltd ATF Perkins Family S/F A/C.
N Scheinkestel: Of which 8,914 shares are held by Nora Scheinkestel and 10,860 shares are held by held by Scheinkestel Superannuation Pty Ltd.
B Long: Held by BJ Long Investments Pty Limited.
18 Mr Mullen's current intention is to acquire his minimum Brambles shareholding requirement prior to the 2021 Annual General Meeting, subject to any
regulatory issues, which would prevent him from purchasing shares. In accordance with the ASX Listing Rules, any acquisition of shares by Mr Mullen will be
announced to the ASX.
35,000
20,000
14,890
15,000
8,925
9,450
-
20,000
19,774
24,000
59
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Non-Executive Directors’ Remuneration for the Year
Fees and other benefits provided to Non-Executive Directors during the Year and the prior year are set out in Table 7.4.1 below in
US dollars. The full names of the Non-Executive Directors and the dates of any changes in Non-Executive Directors during the Year
are shown in the Directors’ Report – Additional Information on page 65. Non-Executive Directors do not receive any share-based
payments.
Any contributions to personal superannuation or pension funds on behalf of the Non-Executive Directors are deducted from their
overall fee entitlements.
Table: Non-Executive Directors’ Remuneration for the Year
US$'000
Name
Short-term employee
benefits
Post-employment benefits
Year
Directors’ fees
Superannuation
Other1199
Total
Non-Executive Directors as at 30 June 2021
G El-Zoghbi
E Fagan
A G Froggatt
T Hassan
K McCall
J Miller
J Mullen
S Perkins
N Scheinkestel
FY21
FY20
FY21
FY20
FY21
FY20
FY21
FY20
FY21
FY20
FY21
FY20
FY21
FY20
FY21
FY20
FY21
FY20
Former Non-Executive Director
B Long20
FY21
Totals21
FY20
FY21
FY20
Remuneration Governance
Remuneration Committee
167
162
167
167
160
150
167
156
155
-
167
155
428
95
200
165
174
12
46
161
1,831
1,223
8
8
8
8
15
13
8
7
7
-
8
7
41
9
4
7
17
1
4
15
120
75
-
2
2
2
-
-
1
1
-
-
2
2
-
-
-
-
-
-
-
-
5
7
175
172
177
177
175
163
176
164
162
-
177
164
469
104
204
172
191
13
50
176
1,956
1,305
The Committee operates under delegated authority from Brambles’ Board. The Committee’s responsibilities include:
Recommending overall Remuneration Policy to the Board;
-
- Determining and implementing a process to enable the Committee to satisfy itself that the conduct of members of the ELT is
consistent with Brambles’ Code of Conduct, shared values and risk appetite and reviewing and, if necessary, amending that
process from time to time;
Recommending to the Board the overall remuneration for the CEO;
Approving the remuneration arrangements for the other Executive KMP; and
Reviewing the Remuneration Policy and individual remuneration arrangements for other senior executives.
-
-
-
19 The Other column includes tax support services.
20 B Long retired from the Board on 8 October 2020.
21 The year-on-year comparison of remuneration is affected by the movement of 30 June 2021 rates from A$1=US$0.6692, €1=US$1.1064 and £1=US$1.2582 for FY20
to A$1=US$0.7477, €1=US$1.1959 and £1=US$1.3538 for FY21.
60
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
During the Year, the Committee applied the principles-based approach to non-financial risks, described in Table 3.3.1, to assist
it in assessing the behaviours of executives and their remuneration outcomes. The Committee also works closely with the
Audit & Risk Committee for assurance on the integrity of the financial performance outcomes underlying remuneration
determination. More broadly, the Committee considers the Group’s overall performance, both financial and non-financial, in its
remuneration determinations.
During the Year, members of the Committee were Mr Perkins (Committee Chair), Mr El-Zoghbi, Mr Froggatt, Mr Mullen,
Ms Hassan (up to 1 March 2021, when she retired from the Committee to join the Audit & Risk Committee) and Mr Miller. Other
individuals are invited to attend Committee meetings as required by the Committee. This includes members of Brambles’
management team including the CEO; Group Senior Vice President, Human Resources; Group Vice President, Legal and Secretariat;
and Senior Vice President, Reward, as well as Brambles’ external remuneration advisor, Ernst & Young (EY).
During the Year, the Committee held five meetings.
Details of the Committee’s Charter and the rules of Brambles’ executive and employee share plans can be found under the
Employee Share Plans page of the Corporate Governance section of Brambles’ website.
Securities Trading Policy and Incentive awards
Brambles' Securities Trading Policy applies to share awards granted under the incentive arrangements described in this report. That
policy prohibits designated persons (including all Executive KMP) from acquiring financial products or entering into arrangements
that have the effect of limiting exposure to the risk of price movements of Brambles’ securities. It is a term of senior executives’
employment contracts that they are required to comply with all Brambles' policies (including the Securities Trading Policy).
Management declarations are obtained twice yearly and include a statement that executives have complied with all policies.
Remuneration Advisor
The Committee has appointed EY as Brambles’ remuneration advisor to assist the Company with Non-Executive Director and
executive remuneration matters. In performing its role, the Committee directly requests and receives information and advice
from EY.
During the Year, no remuneration recommendations, as defined by the Act, were provided by EY.
Other Reporting requirements
Share-Based Payments – Future Potential
The table below provides annual accounting values for share awards relating to the years FY19 to FY21, which have been amortised
over two to three years. These share awards are subject to conditions set out in Section 4. Remuneration will normally not be
received as a result of the underlying share awards vesting unless the performance conditions to which they are subject have been
met.
US$'000
Name
Executive Directors
G Chipchase
N O'Sullivan
Other Executive KMP
D Cuenca
L Nador
Totals
Share-based payment
Total before
equity
Awards
Percentage of
total remuneration
2,993
2,440
1,694
1,393
739
-
842
802
6,268
4,635
2,467
1,625
1,417
1,121
273
-
562
329
4,719
3,075
45%
40%
46%
45%
27%
-
40%
29%
Year
FY21
FY20
FY21
FY20
FY21
FY20
FY21
FY20
FY21
FY20
Total
5,460
4,065
3,111
2,514
1,012
-
1,404
1,131
10,987
7,710
61
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
LTI Share Awards Yet to be Tested
The following table provides details of the level of vesting for the TSR component of LTI share awards granted in FY20 and FY21 if
the current TSR performance was to be maintained until the end of the applicable Performance Period:
Awards
made
during
Performance
condition
Start of
Performance Period
End of
Performance Period
Out-performance
of median company’s
TSR (%)2222
Period to 30 June 2021:
vesting if current performance is
maintained until testing date (%
of original award)
FY20
Relative TSR (ASX 100) 1 July 2019
30 June 2022
FY20
Relative TSR (MSCI)
1 July 2019
30 June 2022
FY21
Relative TSR (ASX 100) 1 July 2020
30 June 2023
FY21
Relative TSR (MSCI)
1 July 2020
30 June 2023
N/A
N/A
N/A
N/A
0% LTI TSR awards
0% LTI TSR awards
0% LTI TSR awards
0% LTI TSR awards
The following table provides details of the level of vesting for the sales revenue CAGR/ROCI component of LTI share awards
granted in FY20 and FY21 if the current sales revenue CAGR/ROCI performance were to be maintained until the end of the
applicable Performance Period:
Awards
made
during
Performance
condition
Start of
Performance Period
End of
Performance Period
Period to 30 June 2021: vesting if
current performance is maintained until
testing date (% of original award)
FY20
Sales Revenue CAGR/ROCI
1 July 2019
FY21
Sales Revenue CAGR/ROCI
1 July 2020
30 June 2022
30 June 2023
100.0% LTI Sales Revenue ROCI awards
100.0% LTI Sales Revenue ROCI awards
Summary of STI and LTI Share Awards
The table below contains details of the STI and LTI share awards granted in which former or current Executive KMP have unvested
and/or unexercised awards that could affect remuneration in this or future reporting periods. STI and LTI share awards do not have
an exercise price and carry no voting rights. The LTI share awards described as LTI TSR awards vest on the third anniversary of their
grant date, subject to continued employment and meeting the relevant TSR performance condition set out in Section 4.3. The LTI
share awards described as LTI ROCI vest on the third anniversary of their grant date, subject to continued employment and meeting
a sales revenue CAGR/ROCI performance condition set out in Section 4.3.1.
Details pertaining to Brambles' employee share plan, MyShare, are in Section 6.
Performance Share Plan awards
Vesting condition
STI awards
LTI TSR awards
100% vesting based on continuous employment
50% vesting if TSR is equal to the median ranked company
100% vesting if at 75th percentile
FY19-FY21 LTI ROCI award
20% vesting occurs if CAGR is 4% and ROCI is 16% over three-year period
100% vesting occurs if CAGR is 6% and ROCI is 19% over three-year period
FY20-FY22 LTI ROCI award
20% vesting occurs if CAGR is 3% and ROCI is 16.5% over three-year period
100% vesting occurs if CAGR is 4% and ROCI is 19.5% over three-year period
FY21-FY23 LTI ROCI award
20% vesting occurs if CAGR is 3% and ROCI is 15.0% over three-year period
100% vesting occurs if CAGR is 4% and ROCI is 18.0% over three-year period
The terms and conditions of each grant of STI and LTI share awards affecting remuneration of Executive KMP in this or future
reporting periods are outlined in the table below. Awards granted under the plans do not have an exercise price and carry no
voting rights. The STI awards vest on the second anniversary of their grant date, subject to continued employment.
Performance Share
Plan Awards
STI/LTI TSR/
FY19-FY21 LTI ROCI
STI/LTI TSR/
FY20-FY22 LTI ROCI
STI/LTI TSR/
FY21-FY23 LTI ROCI
Grant date
Expiry date
Value at grant
2 September 2018
2 September 2024 A$10.33 (STI) / A$10.02 (ROCI) /
A$6.74 (TSR-ASX) / A$7.32 (TSR-MSCI)
Status/vesting date
STI - 2 September 2020
LTI - 2 September 2021
15 October 2019
15 October 2025
15 October 2020
15 October 2026
A$11.53 (STI) / A$10.54 (ROCI) /
A$4.75 (TSR-ASX) / A$5.14 (TSR-MSCI)
STI – 15 October 2021
LTI – 15 October 2022
A$10.82 (STI) / A$10.05 (ROCI) /
A$4.52 (TSR-ASX) / A$4.56 (TSR-MSCI)
STI – 15 October 2022
LTI – 15 October 2023
22 Performance against both the ASX 100 and MSCI World Industrials indices will be based on the standard TSR ranking approach, with threshold vesting commencing at
the 50th percentile and progressively vesting to full vesting at the 75th percentile.
62
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Basis of Valuation of STI and LTI Share Awards
Unless otherwise specified, the fair values of the STI and LTI share awards included in the tables in this report have been estimated
in accordance with the requirements of AASB 2: Share-based Payments, using a Monte Carlo simulation model. Assumptions used
in the evaluations are outlined in Note 22 on pages 107 and 108 of the financial statements.
This fair value is not used to calculate the number of STI and LTI share awards granted to executives. The number of share awards
granted is based on the market value of Brambles' shares calculated on a five-day volume weighted average share price prior to the
grant date. This is termed a 'face value approach'.
Equity-Based Awards
The following table shows details of equity-based awards made to Executive KMP during the Year. STI and LTI share awards were
made under the PSP, the terms and conditions of which are set out in Section 3. MyShare Matching Shares were made under
MyShare, the terms and conditions of which are set out in Section 6. Approval for the STI and LTI share awards and
MyShare Matching Awards issued to Mr Chipchase and Ms O'Sullivan was obtained under ASX Listing Rule 10.14.
Name
Executive Directors
G Chipchase
N O'Sullivan
Other Executive KMP
D Cuenca
L Nador
Shareholdings
Type of award
Number
Value at grant US$'0002233
STI
LTI
MyShare Matching Shares
Totals
STI
LTI
MyShare Matching Shares
Totals
STI
LTI
MyShare Matching Shares
Totals
STI
LTI
MyShare Matching Shares
Totals
94,303
262,064
457
356,824
54,717
146,421
489
201,627
17,033
48,849
507
66,389
33,133
59,369
429
92,931
726
2,017
4
2,747
421
1,127
4
1,552
131
376
4
511
255
457
3
715
The following table shows details of Brambles Limited ordinary shares in which the Executive KMP held relevant interests, being
issued shares held by them and their related parties.24,25
Ordinary shares
Balance at the start of the Year
Changes during the Year
Balance at the end of the Year
Executive Directors
G Chipchase
N O'Sullivan
Other Executive KMP
D Cuenca
L Nador
48,212
22,791
9,086
18,005
172,844
98,497
7,902
39,587
221,056
121,288
16,988
57,592
23 The total value of the relevant equity award(s) is valued as at the date of grant using the methodology set out in Section 3.2. The minimum possible future value of all
awards yet to vest is zero and is based on the performance/service conditions not being met. The maximum possible future value of awards yet to vest is equal to the
value at grant.
24 On 31 July 2021, the following Executive KMP acquired ordinary shares under MyShare, which are held by Certane CT Pty Ltd: G Chipchase (36); N O'Sullivan (43);
D Cuenca (41) and L Nador (32).
On 31 July 2021, the following Executive KMP received Matching Awards under MyShare: G Chipchase (36); N O'Sullivan (43); D Cuenca (41) and L Nador (32).
25 G Chipchase: of which 17,200 shares are held by Rathbones Nominees Ltd, 14,000 shares are held by Rathbones Investment Management Ltd and 189,856 shares are
held by Certane CT Pty Ltd.
N O'Sullivan: of which 9,000 shares are held in her own name and 112,288 shares are held by Certane CT Pty Ltd.
D Cuenca: all of his shares are held by Certane CT Pty Ltd.
L Nador: of which 3,773 shares are held in her own name and 53,819 are held by Certane CT Pty Ltd.
63
Directors’ Report – Remuneration Report
Directors’ Report – Remuneration Report – continued
Interests in Share Rights26
The following table shows details of rights over Brambles Limited ordinary shares in which the Executive KMP held relevant
interests: being STI and LTI share awards made on 23 October 2017, 2 September 2018, 15 October 2019 and 15 October 2020
under the PSP; and Matching Shares, being conditional rights awarded during the Year under MyShare.27,28,29
Balance at the
start of the Year
Number
Granted
during
the Year
Number
Exercised
during
the Year
Number
Name
Executive Directors
G Chipchase
N O'Sullivan
Other Executive KMP
942,622
537,911
356,824
201,627
(314,057)
(180,117)
Lapsed
during
the Year
Number
(27,722)
(15,847)
D Cuenca
L Nador
57,471
185,849
66,389
92,931
(9,330)
(56,652)
-
(5,505)
Vested
and
exercisable
at the end
of the Year
Balance at
the end of
the Year
Value at
exercise
Number
Number
US$'000
957,667
543,574
114,530
216,623
-
-
-
-
2,365
1,021
76
430
Employee Share Plan
The terms and conditions of each grant of Matching Shares affecting remuneration in this or future reporting periods are outlined
in the table below. Share rights granted under the plans do not have an exercise price and carry no dividend or voting rights.
Plan
Grant date
Expiry date
Value at grant
Matching Shares /
vesting date
MyShare 201930
MyShare 202031
MyShare 202132
Each month from
31 March 2019 to 28 February 2020
Each month from
31 March 2020 to 28 February 2021
Each month from
31 March 2021 to 31 July 2021
1 April 2021 Values range per month from
31 March 2021
A$10.75 to A$12.44
1 April 2022 Values range per month from
31 March 2022
A$9.75 to A$11.18
1 April 2023 Values range per month from
31 March 2023
A$10.45 to A$11.55
26 Of the awards detailed in Section 9.3 and Section 6, the following plans' items are relevant to Executive KMP: G Chipchase, N O'Sullivan, L Nador (STI, LTI TSR, LTI 18-
20 ROCI, LTI 19-21 ROCI, LTI 20-22 ROCI, LTI 21-23 ROCI, MyShare 2019, 2020 and 2021) and D Cuenca (STI, LTI TSR, LTI 19-21 ROCI, LTI 20-22 ROCI, LTI 21-23 ROCI,
MyShare 2019, 2020 and 2021).
Lapses occurred for: G Chipchase, N O'Sullivan and L Nador (LTI 18-20 TSR, LTI 18-20 ROCI).
Exercises occurred for: G Chipchase, N O'Sullivan and L Nador (STI, FY18-20 LTI TSR, FY18-20 LTI ROCI, MyShare 2019) and D Cuenca (STI, MyShare 2019).
27 Of the rights exercised during the Year, no monies were paid or payable on exercise. The shares issued on exercise of share rights are fully paid up.
28 During the Year, 2,585,234 equity-settled performance share rights were granted under the PSP, of which 356,367 were granted to G Chipchase and 201,138 were
granted to N O’Sullivan. 1,104,368 Matching Shares were granted under MyShare during the Year, of which 457 were granted to G Chipchase and 489 were granted
to N O’Sullivan.
29 'Lapse' in this context means that the awards were forfeited due to either the applicable service or performance conditions not being met.
30 The Matching Shares granted under the MyShare 2019 Plan vested on 31 March 2021, subject to continuing employment and the retention of the associated Acquired
Shares. On vesting they are automatically exercised.
31 The Matching Shares granted under the MyShare 2020 Plan vest on 31 March 2022, subject to continuing employment and the retention of the associated Acquired
Shares. On vesting they are automatically exercised.
32 The final grant under the MyShare 2021 Plan will occur on 28 February 2022. For FY21 reporting purposes, data is only available up to 31 July 2021. The remaining
information will be reported in the 2022 Annual Report. The Matching Shares granted under MyShare will vest on 31 March 2023, subject to continuing employment
and the retention of the associated Acquired Shares. On vesting they are automatically exercised.
64
Directors’ Report – Remuneration Report
Directors’ Report – Additional Information
The information presented in this report relates to the
consolidated entity, the Brambles Group, consisting of
Brambles Limited and the entities it controlled at the end of,
or during the year ended, 30 June 2021 (the Year).
The unfranked component of each dividend paid during the
Year was conduit foreign income. This means that no
Australian dividend withholding tax was payable on the
dividends that Brambles paid to non-resident shareholders.
Principal Activities
The principal activities of the Group during the Year were the
provision of supply chain logistics solutions, focusing on the
provision of reusable pallets and containers, of which
Brambles is a leading global provider.
Directors
The name of each person who was a Director of Brambles
Limited at any time during or since the end of the Year, and
the period they served as a Director during the Year, is set out
below.
Further details of the Group’s activities are set out in the
Operating & Financial Review on pages 8 to 37.
The qualifications, experience and special responsibilities of
Directors are set out on pages 38 to 41.
Graham Andrew Chipchase 1 July 2020 to date
George El-Zoghbi
1 July 2020 to date
Elizabeth Fagan
1 July 2020 to date
Anthony Grant Froggatt
1 July 2020 to date
Tahira Hassan
1 July 2020 to date
Brian James Long
1 July 2020 to 8 October 2020
Kenneth Stanley McCall
6 July 2020 to date
James Richard Miller
1 July 2020 to date
John Patrick Mullen
1 July 2020 to date
Nessa O'Sullivan
1 July 2020 to date
Scott Redvers Perkins
1 July 2020 to date
Nora Lia Scheinkestel
1 July 2020 to date
Secretary
Details of the qualifications and the experience of
Robert Nies Gerrard, Group Vice President, Legal & Secretariat
and Company Secretary of Brambles Limited, are set out on
page 43.
Details of the qualifications and experience of Carina Thuaux,
Deputy Company Secretary of Brambles Limited, are as
follows: Carina joined Brambles in January 2014 as
Assistant Company Secretary, and was appointed Deputy
Company Secretary and Legal Counsel in April 2018. Prior to
joining Brambles, she was a solicitor with King & Wood
Mallesons. She holds a Bachelor of Commerce and a Bachelor
of Law from the University of New South Wales. She is a
Solicitor of the Supreme Court of New South Wales.
There were no significant changes in the nature of the Group’s
principal activities during the Year.
Review of Operations and Results
A review of the Group’s operations and of the results of
those operations are given in the Letter from the Chair & CEO
and the Operating & Financial Review from pages 4 to 37.
Information about the financial position of the Group is
included in the Operating & Financial Review and in the Five-
Year Financial Performance Summary on page 136.
Significant Changes in State of Affairs
There were no significant changes to the state of affairs of the
Group for the Year.
Matters Since the End of the Financial Year
The Directors are not aware of any matter or circumstance
that has arisen since 30 June 2021 up to the date of this report
that has significantly affected or may significantly affect the
operations of the Group, the results of those operations or the
state of affairs of the Group in future financial years.
Business Strategies and Prospects for Future
Financial Years
The business strategies and prospects for future financial
years, together with likely developments in the operations of
the Group in future financial years and the expected results of
those operations known at the date of this report, are set out
in the Letter from the Chair & CEO and in the Operating &
Financial Review on pages 4 to 37.
Further information in relation to such matters has not been
included because the Directors believe it would be likely to
result in unreasonable prejudice to the Group.
Dividends
The Directors have declared a final dividend for the Year of
10.5 US cents per share, to be paid in Australian dollars at
14.24 Australian cents per share, and which will be
30% franked. The dividend will be paid on 14 October 2021
to shareholders on the register on 9 September 2021.
On 8 April 2021, an interim dividend for the Year was paid,
which was 10.0 US cents per share and 30% franked.
On 8 October 2020, a final dividend for the year ended
30 June 2020 was paid, which was 9.0 US cents per share and
30% franked.
65
Directors’ Report – Additional Information
Directors’ Report – Additional Information – continued
Indemnities
Under its constitution, to the extent permitted by law,
Brambles Limited indemnifies each person who is, or has
been, a Director or Secretary of Brambles Limited against any
liability which results from facts or circumstances relating to
the person serving or having served in the capacity of
Director, Secretary, other officer or employee of Brambles
Limited or any of its subsidiaries, other than:
-
in respect of a liability other than for legal costs:
-
-
-
a liability owed to Brambles Limited or a related
body corporate;
a liability for a pecuniary penalty order under section
1317G of the Corporations Act 2001 (Cth) (Act) or
a compensation order under section 1317H of
the Act; or
a liability that is owed to someone (other than
Brambles Limited or a related body corporate) and
did not arise out of conduct in good faith; and
-
in respect of a liability for legal costs:
-
-
-
in defending or resisting criminal proceedings in
which the person is found to have a liability for which
they could not have been indemnified in respect of a
liability owed to Brambles Limited or a related body
corporate;
in defending or resisting criminal proceedings in
which the person is found guilty. This does not apply
to costs incurred in responding to actions brought by
the Australian Securities & Investment Commission
(ASIC) or a liquidator as part of an investigation
before commencing proceedings for a Court order;
in defending or resisting proceedings brought by
ASIC or a liquidator for a Court order if the grounds
-
for making the order are found by the Court to be
established; or
in connection with proceedings for relief to any
persons under the Act in which the Court denies
the relief.
As allowed by its constitution, Brambles Limited has provided
indemnities to its Directors, Secretaries or other Statutory
Officers of its subsidiaries (Beneficiaries) against all loss, cost
and expenses (collectively Loss) caused by or arising from any
act or omission by the relevant person in performance of that
person's role as a Director, Secretary or Statutory Officer.
The indemnity given by Brambles Limited excludes the
following matters:
-
-
-
-
-
-
-
any Loss to the extent caused by or arising from an act or
omission of the Beneficiary prior to the effective date of
the indemnity;
any Loss to the extent indemnity in respect of that Loss is
prohibited under the Act (or any other law);
any Loss to the extent it arises from private or personal
acts or omissions of the Beneficiary;
any Loss comprising the reimbursement of normal day-
to-day expenses such as travelling expenses;
any Loss to the extent the Beneficiary failed to act
reasonably to mitigate the Loss;
any Loss to the extent it is caused by or arises from acts
or omissions of the Beneficiary after the date the
indemnity is revoked by Brambles Limited in accordance
with the terms of the indemnity; and
any Loss to the extent it is caused by or arises from any
breach by the Beneficiary of the terms of the indemnity.
Insurance policies are in place to cover Directors and
executive officers; however, the terms of the policies prohibit
disclosure of the details of the insurance cover and the
premiums paid.
66
Directors’ Report – Additional Information
Directors’ Report – Additional Information – continued
Directors’ Meetings
Details of Board Committee memberships are given in the Directors' biographies on pages 38 to 41. The following table
shows the actual Board and Committee meetings held during the Year and the number attended by each Director or
Committee member.
Regular
Special Committees Audit & Risk
Board meetings
Committee
meetings(c)
Remuneration
Committee
meetings
Nominations
Committee
meetings(d)
Directors
G A Chipchase
G El-Zoghbi
E Fagan
A G Froggatt
T Hassan
K S McCall
J R Miller
J P Mullen
N O'Sullivan
S R Perkins
N L Scheinkestel
Former Director
(a)
14
14
14
14
14
14
14
14
14
14
14
(b)
14
14
14
14
14
14
14
14
14
14
14
B J Long
4
4
(a)
2
(b)
2
-
-
-
-
-
-
2
2
-
2
1
-
-
-
-
-
-
2
2
-
2
1
(a)
(b)
(a)
(b)
(a)
(b)
-
-
5
-
2
2
-
-
-
6
6
2
-
-
6
-
2
2
-
-
-
6
6
2
-
5
-
5
3
-
5
5
-
5
-
-
-
5
-
5
3
-
5
5
-
5
-
-
-
1
1
1
-
-
-
1
-
1
-
-
-
1
1
1
-
-
-
1
-
1
-
-
a) The number of meetings attended during the period the Director was a member of the Board or relevant Committee which
the Director was eligible to attend.
b) The number of meetings held while the Director was a member of the Board or relevant Committee which the Director was
eligible to attend.
c) The Audit Committee was reconstituted as the Audit & Risk Committee on 16 March 2021.
d) On 1 March 2021, all Directors were made members of the Nominations Committee. The first meeting of the Nominations
Committee so constituted was held on 1 July 2021.
67
Directors’ Report – Additional Information
Directors’ Report – Additional Information – continued
Directors’ Directorships of Other Listed Companies
The following lists the directorships held by the Directors in listed companies (other than Brambles Limited) since 30 June 2018.
Director
G A Chipchase
G El-Zoghbi
E Fagan
A G Froggatt
T Hassan
K S McCall
J R Miller
J P Mullen
N O'Sullivan
S R Perkins
Listed company
AstraZeneca plc
The Kraft Heinz Company
None
None
None
Post Office Limited
The RealReal, Inc.
Wayfair, Inc.
Telstra Corporation Limited
Brookfield Infrastructure:
Period directorship held
2012 to April 2021
2018 to April 2021
-
-
-
2016 to current
2019 to current
2016 to March 2020
2008 to current
- Brookfield Infrastructure Partners L.P.
2017 to February 2020
- Brookfield Infrastructure Corporation
May 2021 to current
Molson Coors Beverage Company
May 2020 to current
Woolworths Limited
Origin Energy Limited
2014 to current
2015 to current
N L Scheinkestel
Atlas Arteria:
- Atlas Arteria Limited1
2014 to November 2020
- Atlas Arteria International Limited1
2015 to November 2020
AusNet Services Ltd
Oceana Gold Corporation
Telstra Corporation Limited
2016 to current
2018 to 2019
2010 to current
Westpac Banking Corporation
March 2021 to current
1 Stapled entities.
68
Directors’ Report – Additional Information
Directors’ Report – Additional Information – continued
Environmental Regulation
Except as set out below, the Group’s operations in Australia
are not subject to any particular and significant environmental
regulation under a law of the Commonwealth or a State or
Territory. The operations of the Group in Australia involve the
use or development of land, the use of transportation
equipment and the transport of goods. These operations may
be subject to State, Territory or local government
environmental and town planning regulations, or require
a licence, consent or approval from Commonwealth, State or
Territory regulatory bodies. There were no material breaches
of environmental statutory requirements and no material
prosecutions during the Year. Brambles’ businesses comply
with all relevant environmental laws and regulations and none
were involved in any material environmental prosecutions
during the Year.
The Group’s operations are subject to numerous
environmental laws and regulations in the other countries in
which it operates. There were no material breaches of these
laws or regulations during the Year.
Corporate Governance Statement
Brambles is committed to observing the corporate
governance requirements applicable to publicly listed
companies in Australia. The Board has adopted a Corporate
Governance Framework designed to enable Brambles to meet
its legal, regulatory and governance requirements.
During the Year, the Board believes Brambles met all the
requirements of the Fourth Edition of the CGPR. Brambles'
2021 Corporate Governance Statement is on Brambles'
website at brambles.com/corporate-governance-overview
Interests in Securities
Pages 59, 63 and 64 of the Directors’ Report – Remuneration
Report include details of the relevant interests of Directors,
and other Group executives whose details are required to be
disclosed, in shares and other securities of Brambles Limited.
Share Capital, Options and Share Rights
Details of the changes in the issued share capital of Brambles
Limited and share rights and MyShare matching share rights
outstanding over Brambles Limited ordinary shares at the
year end are given in Notes 21 and 22 of the Financial Report
on pages 106 to 108.
No options, share rights or MyShare matching share rights
over the shares of Brambles Limited’s controlled entities
were granted during or since the end of the Year to the date
of this report.
Since the end of the Year to the date of this report, the
following grants, exercises and forfeits in options,
performance share rights and MyShare matching share rights
over Brambles Limited ordinary shares have taken place:
-
-
181,498 grants under the 2021 MyShare plan offer;
3,413 exercises resulting in the issue of fully paid ordinary
shares: 2,424 under the 2020 MyShare plan; 989 under
the 2021 MyShare plan; and
-
27,972 lapses: 16,597 under the 2020 MyShare plan;
11,375 under the 2021 MyShare plan.
Share Buy-Backs
On 25 February 2019, Brambles announced that it would be
selling its IFCO RPC business for US$2.5 billion and that up to
US$1.65 billion (A$2.4 billion) of the proceeds of that sale
would be returned to shareholders through an on-market
buy-back of its ordinary shares. The sale of IFCO RPC
completed on 31 May 2019 and Brambles commenced the
on-market buy-back on 4 June 2019. Between that date and
10 October 2019, 29,542,722 ordinary shares were bought-
back and cancelled for a total consideration of
A$341,996,920.26.
At the 2019 Annual General Meeting, shareholders approved
the on-market buy-back of up to 240,000,000 fully paid
ordinary shares, being 15% of the Company's issued shares as
at 16 August 2019, in the 12-month period following that
resolution. Between that date and 8 October 2020, 76,775,745
ordinary shares were bought back and cancelled for a total
consideration of A$863,123,968.54.
At the 2020 Annual General Meeting, shareholders approved
the on-market buy-back of up to 150,400,000 fully paid
ordinary shares, being 10% of the Company's issued share
capital as at 26 August 2020, in the 12 month period following
that resolution. Between that date and 22 June 2021,
51,648,288 ordinary shares were bought back and cancelled
for a total consideration of A$543,793,996.97. No ordinary
shares have been bought back from 23 June 2021 to the date
of this report.
Non-Audit Services and Auditor Independence
The amount of US$43,000 was paid or is payable to PwC, the
Group’s auditors, for non-audit services provided during the
Year by them (or another person or firm on their behalf).
These services primarily related to taxation, training and
corporate administration.
The Audit & Risk Committee has reviewed the provision of
non-audit services by PwC and its related practices and
provided the Directors with formal written advice of a
resolution passed by the Audit & Risk Committee. Consistent
with this advice, the Directors are satisfied that the provision
of non-audit services by PwC and its related practices did not
compromise the auditor independence requirements of the
Act for the following reasons: the nature of the non-audit
services provided during the Year; the quantum of non-audit
fees compared to overall audit fees; and the pre-approval,
monitoring and ongoing review requirements under the
Audit & Risk Committee Charter and the Charter of Audit
Independence in relation to non-audit work.
The auditors have also provided the Audit & Risk Committee
with a letter confirming that, in their professional judgement,
as at 17 August 2021 they have maintained their
independence in accordance with their firm’s requirements,
with the provisions of APES 110 – Code of Ethics for
Professional Accountants and with the applicable provisions of
the Act. On the same basis, they also confirmed that the
69
Directors’ Report – Additional Information
Directors’ Report – Additional Information – continued
objectivity of the audit engagement partners and the audit
staff is not impaired.
Auditor's Independence Declaration
A copy of the auditor’s independence declaration as required
under section 307C of the Act is set out on page 135.
Annual General Meeting
Brambles' 2021 Annual General Meeting (AGM) will be held at
4.00pm (AEDT) on 19 October 2021. Details on the form of the
AGM will be in the Notice of Meeting, which will be sent to
shareholders and posted on brambles.com in early
September 2021.
This Directors’ Report is made in accordance with a resolution
of the Board.
John Mullen
Graham Chipchase
Chair
Chief Executive Officer
17 August 2021
70
Directors’ Report – Additional Information
Shareholder Information
Stock Exchange Listing
Brambles’ ordinary shares are listed on the Australian
Securities Exchange and are traded under the stock
code 'BXB'.
Uncertificated Forms of Shareholding
Brambles’ ordinary shares are held in uncertificated form.
There are two types of uncertificated holdings:
-
-
Issuer Sponsored Holdings: This type of holding is
recorded on a subregister of the Brambles share register,
maintained by Brambles. If your holding is recorded on
the issuer-sponsored subregister, you will be allocated a
Securityholder Reference Number, or SRN, which is a
unique number used to identify your holding of ordinary
shares in Brambles; and
Broker Sponsored Holdings: This type of holding is
recorded on the main Brambles share register.
Shareholders who are sponsored by an ASX market
participant broker will be allocated a Holder Identification
Number, or HIN. One HIN can relate to an investor’s
shareholdings in multiple companies. For example, a
shareholder with a portfolio of holdings which are
managed by a broker would have the same HIN for
each shareholding.
American Depository Receipts
Brambles Limited shares may be traded in sponsored
American Depository Receipts form in the United States.
Dividend
Dividends are paid in Australian dollars or US dollars.
Shareholder may elect to have their dividend paid in the
currency of their registered address through a service
provided by Brambles' share registry by contacting
Boardroom at the address set out in Contact Information on
the inside back cover of this Annual Report.
Annual General Meeting
The Brambles Limited 2021 AGM will be held at
4.00pm (AEDT) on 19 October 2021. Details of the form
of the AGM will be in the Notice of Meeting, which will be
sent to shareholders and posted on brambles.com in
early September 2021.
Financial Calendar
Final Dividend 2021
Ex-dividend date – Wednesday, 8 September 2021
Record date – Thursday, 9 September 2021
Payment date – Thursday, 14 October 2021
2022 (Provisional)
Announcement of interim results – mid-February 2022
Interim dividend – mid-April 2022
Announcement of final results – mid-August 2022
Final dividend – mid-October 2022
AGM – October 2022
Company Secretaries
R N Gerrard
C Thuaux
Analysis of Holders of Equity Securities as at 30 July 2021
Substantial Shareholders
Brambles has been notified of the following substantial shareholdings:
Holder
Blackrock Group
The Vanguard Group, Inc.
State Street Corporation
Number of Ordinary Shares on Issue and Distribution of Holdings
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Number of ordinary shares
% of issued ordinary share capital1
116,875,451
79,118,824
72,630,126
Holders
34,341
30,118
4,867
2,745
94
72,165
8.072
5.46
5.01
Shares
15,733,040
70,289,957
34,262,276
57,208,489
1,263,677,014
1,441,170,776
The number of members holding less than a marketable parcel of 43 ordinary shares (based on a market price of A$11.62 on
31 July 2021) is 1,788 and they hold a total of 22,330 ordinary shares. The voting rights of ordinary shares are described on
page 72.
1 Percentages are as disclosed in substantial holding notices given to Brambles Limited.
2 Blackrock Group also holds 0.1% of issued share capital through Brambles American Depositary Receipts.
71
Shareholder Information
Shareholder Information – continued
Number of Share Rights on Issue and Distribution of Holdings
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Holders
3,530
41
33
92
13
3,709
Share rights
1,297,298
135,538
231,919
2,849,496
3,283,772
7,795,023
The voting rights of performance share rights and MyShare Matching Awards are described below.
Twenty Largest Ordinary Shareholders
Name
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
CITICORP NOMINEES PTY LIMITED
NATIONAL NOMINEES LIMITED
BNP PARIBAS NOMS PTY LTD
CITICORP NOMINEES PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD
BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD
AUSTRALIAN FOUNDATION INVESTMENT COMPANY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
ARGO INVESTMENTS LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
CERTANE CT PTY LTD
NATIONAL NOMINEES LIMITED
NETWEALTH INVESTMENTS LIMITED
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
CUSTODIAL SERVICES LIMITED
AMP LIFE LIMITED
MUTUAL TRUST PTY LTD
AUSTRALIAN EXECUTOR TRUSTEES LIMITED
Number of
ordinary shares
% of
issued ordinary
share capital
629,479,527
241,809,881
131,173,762
57,561,500
54,807,944
25,914,041
23,306,606
11,688,841
9,278,658
8,238,022
6,001,109
5,008,091
4,501,435
4,430,223
3,950,918
3,590,252
3,550,214
1,986,166
1,903,110
1,723,437
43.68
16.78
9.10
3.99
3.80
1.80
1.62
0.81
0.64
0.57
0.42
0.35
0.31
0.31
0.27
0.25
0.25
0.14
0.13
0.12
Total holdings of Twenty largest holders
1,229,903,737
85.34
Voting Rights: Ordinary Shares
Brambles Limited’s constitution provides that each member entitled to attend and vote may do so in person or by proxy, by
attorney or, where the member is a body corporate, by representative. The Directors may also determine that at any general
meeting, a member who is entitled to attend and vote on a resolution at that meeting is entitled to a direct vote in relation to
that resolution. The Directors have prescribed rules to govern direct voting, which are available at brambles.com.
On a show of hands, every member present in person, by proxy, by attorney or, where the member is a body corporate, by
representative, and having the right to vote on a resolution, has one vote. The Directors have determined that members who
submit a direct vote on a resolution will be excluded on a vote on that resolution by a show of hands or on a poll. The Directors
have determined that votes cast by members who submit a direct vote will be included on a vote by a poll, being one vote for
each ordinary share held.
Voting Rights: Share Rights
Performance share rights over ordinary shares and MyShare Matching Awards do not carry any voting rights.
72
Shareholder Information
Consolidated Financial Report
for the year ended 30 June 2021
INDEX
PAGE
Consolidated Statement of Comprehensive Income
Consolidated Balance Sheet
Consolidated Cash Flow Statement
Consolidated Statement of Changes in Equity
Notes to and Forming Part of the Financial Statements
1 About This Report
2 Segment Information – Continuing Operations
3 Operating Expenses – Continuing Operations
4 Significant Items – Continuing Operations
5 Net Finance Costs – Continuing Operations
6 Income Tax
7 Earnings Per Share
8 Dividends
9 Investments
10 Discontinued Operations
11 Trade and Other Receivables
12 Inventories
13 Other Assets
14 Property, Plant and Equipment
15 Right-of-Use Leased Assets
16 Goodwill and Intangible Assets
17 Trade and Other Payables
18 Provisions
19 Borrowings
20 Retirement Benefit Obligations
21 Contributed Equity
22 Share-Based Payments
23 Reserves and Retained Earnings
24 Financial Risk Management
25 Cash Flow Statement – Additional Information
26 Capital Expenditure Commitments
27 Contingencies
28 Auditor’s Remuneration
29 Key Management Personnel
30 Related Party Information
31 Events After Balance Sheet Date
32 Net Assets Per Share
33 Parent Entity Financial Information
Directors' Declaration
Independent Auditor's Report
Auditor's Independence Declaration
74
75
76
77
78
80
84
85
85
86
90
92
92
93
94
95
95
96
98
100
103
103
104
104
106
107
109
111
119
121
122
123
124
124
125
126
126
128
129
135
73
Consolidated Financial Report
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2021
Continuing operations
Sales revenue
Other income
Operating expenses
Share of results of associate
Operating profit
Finance revenue
Finance costs
Net finance costs
Profit before tax
Tax expense
Profit from continuing operations
Loss from discontinued operations
Profit for the year attributable to members of the parent entity
Other comprehensive income:
Items that will not be reclassified to profit or loss:
Actuarial gain/(loss) on defined benefit pension plans
Tax benefit on items that will not be reclassified to profit or loss
Items that may be reclassified to profit or loss:
Exchange differences on translation of foreign subsidiaries1
Exchange differences released to profit on divestment of Kegstar
Other comprehensive income/(expense) for the year
Total comprehensive income for the year attributable to members of the
parent entity
Earnings per share (EPS) - US cents
Continuing operations
- basic
- diluted
Total
- basic
- diluted
1
Note
2
3
9
5
6A
10
6A
23
23
7
2021
US$m
5,209.8
192.3
(4,522.2)
(0.6)
879.3
10.0
(95.6)
(85.6)
793.7
(258.7)
535.0
(8.9)
526.1
2.7
3.9
6.6
180.9
3.3
184.2
190.8
716.9
36.3
36.1
35.7
35.5
2020
US$m
4,717.9
130.9
(4,049.4)
-
799.4
25.0
(105.8)
(80.8)
718.6
(210.6)
508.0
(60.0)
448.0
(6.0)
1.9
(4.1)
(143.9)
-
(143.9)
(148.0)
300.0
32.8
32.7
28.9
28.8
Exchange differences on translation of foreign subsidiaries have been significantly impacted by the appreciation of the
Australian dollar, British Pound and Euro net assets translated into US dollars. The 2021 spot rate relative to the US dollar
strengthened by 9.5% for the Australian dollar, 12.5% for the British Pound and 5.9% for the Euro.
The consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
74
Consolidated Financial Report Consolidated Balance Sheet
as at 30 June 2021
Assets
Current assets
Cash and cash equivalents
Term deposits
Trade and other receivables
Inventories
Other assets
Total current assets
Non-current assets
Other receivables
Property, plant and equipment
Right-of-use leased assets
Goodwill and intangible assets
Investments
Deferred tax assets
Other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Lease liabilities
Borrowings
Tax payable
Provisions
Total current liabilities
Non-current liabilities
Lease liabilities
Borrowings
Provisions
Retirement benefit obligations
Deferred tax liabilities
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Retained earnings
Total equity
Note
25
2
11
12
13
11
14
15
16
9
6C
13
17
25C
19
18
25C
19
18
20
6C
21
23
23
The consolidated balance sheet should be read in conjunction with the accompanying notes.
2021
US$m
408.5
-
851.2
79.5
103.0
2020
US$m
737.3
68.6
717.2
67.5
95.6
1,442.2
1,686.2
23.6
4,933.2
608.1
281.8
53.9
118.0
7.1
6,025.7
7,467.9
1,607.0
147.5
32.4
67.6
116.3
1,970.8
565.1
1,718.1
82.5
33.3
408.9
2,807.9
4,778.7
2,689.2
4,924.8
(7,274.8)
5,039.2
2,689.2
23.3
4,409.3
598.8
259.6
-
96.3
9.7
5,397.0
7,083.2
1,226.5
112.8
36.3
45.8
84.9
1,506.3
591.4
1,777.2
76.1
37.7
338.1
2,820.5
4,326.8
2,756.4
5,427.2
(7,464.3)
4,793.5
2,756.4
75
Consolidated Financial Report
Consolidated Cash Flow Statement
for the year ended 30 June 2021
Note
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Cash generated from operations
Interest received
Interest paid
Income taxes paid on operating activities
Net cash inflow from operating activities
25B
Cash flows from investing activities
Payments for property, plant and equipment
Proceeds from sale of property, plant and equipment1
Payments for intangible assets
Payments for disposal of businesses
Acquisition of forestry assets
Net cash outflow from investing activities
Cash flows from financing activities
Proceeds from borrowings
Repayment of borrowings
Transfers from term deposits
Payment of principal component of lease liabilities
Net (outflow)/inflow from derivative financial instruments
Payments for share buy-back
Repayment of capital to shareholders
Dividends paid - ordinary
Dividends paid - special
Net cash outflow from financing activities
Net decrease in cash and cash equivalents
10
2
21
21
8
8
Cash and cash equivalents, net of overdrafts, at beginning of the year
Effect of exchange rate changes
Cash and cash equivalents, net of overdrafts, at end of the year
25A
2021
US$m
5,966.2
(4,135.7)
1,830.5
3.6
(87.1)
(187.6)
1,559.4
2020
US$m
5,446.8
(3,786.2)
1,660.6
17.2
(112.7)
(178.2)
1,386.9
(1,056.5)
(1,002.8)
145.8
(26.7)
(9.5)
(15.5)
(962.4)
120.8
(257.1)
68.6
(128.8)
(5.3)
(523.1)
-
(280.8)
-
(1,005.7)
(408.7)
737.3
78.4
407.0
104.4
(26.3)
(16.0)
-
(940.7)
554.9
(903.9)
342.6
(114.1)
26.5
(645.4)
(129.3)
(290.7)
(183.2)
(1,342.6)
(896.4)
1,690.4
(56.7)
737.3
1
Includes compensation for lost pooling equipment of US$128.8 million in 2021 (2020: US$103.2 million).
The consolidated cash flow statement should be read in conjunction with the accompanying notes.
76
Consolidated Financial Report
Consolidated Statement of Changes in Equity
for the year ended 30 June 2021
Year ended 30 June 2020
Opening balance at 1 July 2019
Profit for the year
Other comprehensive expense
Total comprehensive (expense)/income
Share-based payments:
- expense recognised
- shares issued
- equity component of related tax
Transactions with owners in their capacity as owners:
- dividends declared
- issue of ordinary shares, net of transaction costs
- share buy-back
- shareholder capital return
Contributed
Retained
equity
Reserves
earnings
Note
US$m
US$m
US$m
Total
US$m
6,187.4
(7,322.5)
4,821.5
3,686.4
-
-
-
-
-
-
-
14.5
(645.4)
(129.3)
22
8
21
21
21
-
448.0
448.0
(143.9)
(143.9)
(4.1)
(148.0)
443.9
300.0
18.4
(14.5)
(1.8)
-
-
-
-
-
-
-
18.4
(14.5)
(1.8)
(471.9)
(471.9)
-
-
-
14.5
(645.4)
(129.3)
Closing balance as at 30 June 2020
5,427.2
(7,464.3)
4,793.5
2,756.4
Year ended 30 June 2021
Opening balance at 1 July 2020
5,427.2
(7,464.3)
4,793.5
2,756.4
Profit for the year
Other comprehensive income
FCTR released to profit on divestment of Kegstar
Total comprehensive income
Share-based payments:
- expense recognised
- shares issued
- equity component of related tax
- transfer to retained earnings on divestment of Kegstar
Transactions with owners in their capacity as owners:
- dividends declared
- issues of ordinary shares, net of transaction costs
- share buy-back
-
-
-
-
-
-
-
-
22
8
21
21
-
20.7
(523.1)
-
526.1
180.9
3.3
6.6
-
526.1
187.5
3.3
184.2
532.7
716.9
24.9
(20.7)
1.4
(0.3)
-
-
-
-
-
-
-
24.9
(20.7)
1.4
(0.3)
(287.0)
(287.0)
-
-
20.7
(523.1)
Closing balance as at 30 June 2021
4,924.8
(7,274.8)
5,039.2
2,689.2
The consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
77
Consolidated Financial Report Notes to and Forming Part of the Financial Statements
for the year ended 30 June 2021
Note 1. About This Report
A) Basis of Preparation
These financial statements present the consolidated results of Brambles Limited (ACN 118 896 021) (Company) and its
subsidiaries and associates (Brambles or the Group) for the year ended 30 June 2021. These financial statements have been
authorised for issue in accordance with a resolution of the Directors on 17 August 2021.
References to 2021 and 2020 are to the financial years ended 30 June 2021 and 30 June 2020, respectively. The financial
statements comply with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards
Board (IASB). This general purpose financial report has been prepared in accordance with Australian Accounting Standards
(AAS), other authoritative pronouncements of the Australian Accounting Standards Board (AASB) and the requirements of the
Corporations Act 2001. It presents information on a historical cost basis, except for derivative financial instruments and
financial assets at fair value through profit or loss.
The financial statements and all comparatives have been prepared using the accounting policies disclosed throughout the
financial statements, which are consistent with the prior year.
As Brambles is a company of a kind referred to in ASIC Corporations (Rounding in Financial/Directors' Reports) Instrument
2016/191, relevant amounts in the financial statements and Directors’ Report have been rounded to the nearest hundred
thousand US dollars or, in certain cases, to the nearest thousand US dollars. Amounts in cents have been rounded to the
nearest tenth of a cent.
On 10 February 2021, Brambles entered into an agreement to combine its Kegstar keg rental business with MicroStar, a
leading US beer keg solution provider, with completion of the transaction taking place on 16 April 2021. As consideration
Brambles received a 16% interest in MicroStar which is accounted for as an associate using the equity method. Consequently,
the results of Kegstar prior to divestment date are presented in discontinued operations in the consolidated statement of
comprehensive income and all related note disclosures.
Due to a change in reporting structure, the North American automotive business is recognised in CHEP Europe, Middle East,
Africa and India (CHEP EMEA), effective 1 July 2020. Comparative information has been reclassified, where appropriate, to
enhance comparability.
The COVID-19 outbreak occurred during the second half of 2020 and continued throughout 2021 with ongoing outbreaks
around the globe. Where COVID-19 has had a known or potential impact on the Group’s financial results or position for the
year, this has been highlighted in the disclosures to the financial statements.
As at 30 June 2021, Brambles has net current liabilities of US$528.6 million (2020: net current assets of US$179.9 million);
however, liquidity remains strong with US$1,391.1 million of undrawn committed facilities and US$408.5 million of total cash
and cash equivalents.
B) Principles of Consolidation
The consolidated financial statements of Brambles include the assets, liabilities and results of Brambles Limited and all its
subsidiaries and associates. The consolidation process eliminates all intercompany accounts and transactions. The financial
statements of subsidiaries and associates are prepared using consistent accounting policies and for the same reporting period.
Changes for new accounting standards are incorporated in the financial statements of subsidiaries and associates.
The results of subsidiaries and associates acquired or disposed during the year are included in the consolidated statement of
comprehensive income from the effective date of acquisition or up to the effective date of disposal, as appropriate.
The trading results for business operations disposed during the year are disclosed separately as discontinued operations in the
consolidated statement of comprehensive income. The amount disclosed includes any gains or losses arising on disposal.
C) Presentation Currency
Brambles uses the US dollar as its presentation currency because:
-
-
a significant portion of Brambles’ activity is denominated in US dollars; and
the US dollar is widely understood by Australian and international investors and analysts.
D) Foreign Currency
Items included in the financial statements of each of Brambles’ entities are measured using the functional currency of each
entity. Foreign currency transactions are translated into the functional currency of each entity using the exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions, and from the translation at year-end rates of monetary assets and liabilities denominated in foreign currencies,
are recognised in profit or loss, except where deferred in equity as qualifying cash flow hedges, qualifying net investment
hedges or where they are attributable to part of the net investment in foreign subsidiaries.
78
Consolidated Financial Report
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 1. About This Report – continued
D) Foreign Currency –– continued
The results and cash flows of Brambles Limited and its subsidiaries and associates are translated into US dollars using the
average exchange rates for the period. Where this average is not a reasonable approximation of the cumulative effect of the
rates prevailing on the transaction dates, the exchange rate on the transaction date is used. Assets and liabilities of Brambles
Limited and its subsidiaries are translated into US dollars at the exchange rate ruling at the balance sheet date.
The share capital of Brambles Limited is translated into US dollars at historical rates. Exchange differences arising on the
translation of Brambles’ overseas and Australian entities are recognised as a separate component of equity.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the
foreign entity and translated at the closing rate. The principal exchange rates affecting Brambles were:
A$:US$
€:US$
£:US$
Average
2021
0.7477
1.1959
1.3538
2020
0.6692
1.1064
1.2582
Year end
30 June 2021
0.7511
1.1901
1.3845
30 June 2020
0.6860
1.1242
1.2305
Investment in Associates
E)
An associate is an arrangement in which Brambles has significant influence but not control or joint control. Associates are
accounted for using the equity method. Under this method the investment is initially recognised at fair value and adjusted
thereafter to recognise the Group’s share of the post-acquisition profits or losses.
F) Other Income
Other income includes surcharges and net gains on disposal of property, plant and equipment in the ordinary course of
business. The net gain on disposal is recognised when control of the asset has passed to the buyer. Amounts arising from
compensation for irrecoverable pooling equipment are recognised only when it is highly probable that they will be received.
G) Critical Accounting Estimates and Judgements
In applying its accounting policies, Brambles has made estimates and assumptions concerning the future which may differ
from the related actual outcomes.
Material estimates and judgements, including the impact of COVID-19, are found in the following notes:
-
-
-
Income Tax (Note 6F)
Property, Plant and Equipment (Note 14E)
Irrecoverable Pooling Equipment Provision (IPEP) (Note 14D)
H) Changes to Accounting Standards
At 30 June 2021, certain accounting standards and interpretations have been published or amended which will become
mandatory in future reporting periods. These new or amended accounting standards and interpretations are not material to
Brambles.
79
Consolidated Financial Report
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 2. Segment Information – Continuing Operations
Brambles' segment information is provided on the same basis as internal management reporting to the CEO.
Brambles has four reportable segments:
- CHEP North America and Latin America (CHEP Americas);
- CHEP Europe, Middle East, Africa and India, including the North American automotive business (CHEP EMEA);
-
-
CHEP Australia, New Zealand and Asia, excluding India (CHEP Asia-Pacific); and
Corporate centre, including BXB Digital (Corporate).
Segment performance is measured on sales revenue, Underlying Profit, Cash Flow from Operations and Return on Capital
Invested (ROCI). Underlying Profit is the main measure of segment profit.
Due to a change in reporting structure, the North American automotive business is recognised in CHEP EMEA, effective
1 July 2020. Comparatives have been reclassified accordingly.
Segment sales revenue is measured on the same basis as the consolidated statement of comprehensive income. Brambles has
one revenue stream, which is the provision of pooling equipment to customers for a period of time. Several fees are charged to
customers including issue, transfer, transport and daily hire. The predominant billing structure for these fees is either a bundled
upfront fee upon issue of pooling equipment to customers, or a daily hire fee based on the number of days the pooling
equipment is used in the field by a customer. Other fees, such as transport and transfer fees, are billed when the activity occurs.
The services provided by Brambles are deemed a single performance obligation relating to the provision of an end-to-end
pooling solution and the performance obligation is satisfied over time. The issue and daily hire activities are not considered
distinct services. Revenue from issue activities is deferred and recognised over the estimated period that the pooling
equipment is utilised by customers, referred to as the cycle time, which is an output method. Revenue based on the daily hire
model is also recognised over time. Consideration that is fixed or highly probable is included in the transaction price allocated
to the performance obligation. This includes issue fees, daily hire fees and bundled upfront fees. Consideration that is variable
or uncertain is recognised when the activity occurs.
Segment sales revenue is allocated to segments based on product categories and physical location of the business unit that
invoices the customer. Intersegment revenue during the period was immaterial. There is no single external customer who
contributed more than 10% of Group sales revenue.
Assets and liabilities are measured consistently in segment reporting and in the consolidated balance sheet. Assets and
liabilities are allocated to segments based on segment use and physical location. Cash, term deposits, borrowings and tax
balances are managed centrally and are not allocated to segments.
80
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 2. Segment Information – Continuing Operations – continued
By operating segment
CHEP Americas
CHEP EMEA
CHEP Asia-Pacific
Corporate
Sales
revenue
2021
US$m
2020
US$m
2,627.5
2,056.4
525.9
-
2,449.2
1,831.9
436.8
-
Continuing operations
5,209.8
4,717.9
By geographic origin
Americas
Europe
Australia
Other
Total
2,650.0
1,787.1
398.6
374.1
2,469.0
1,580.1
324.7
344.1
5,209.8
4,717.9
Cash Flow from
Operations1
2021
US$m
356.8
487.4
137.6
(80.7)
901.1
2020
US$m
256.9
426.9
132.8
(61.8)
754.8
1
Cash Flow from Operations is cash flow generated after net capital expenditure but excluding Significant Items that are
outside the ordinary course of business.
By operating segment
CHEP Americas
CHEP EMEA
CHEP Asia-Pacific
Corporate4
Continuing operations
Operating
profit2
Underlying
Profit3
2021
US$m
385.5
462.7
146.2
(115.1)
879.3
2020
US$m
344.2
410.3
118.0
(73.1)
799.4
2021
US$m
385.5
462.7
146.2
(115.1)
879.3
2020
US$m
344.2
410.3
118.0
(73.1)
799.4
Underlying Profit is equal to Operating profit in 2021 and 2020 as there are no pre-tax Significant Items.
2
3
4
Operating profit is segment revenue less segment expense and excludes finance costs and tax.
Underlying Profit is a non-statutory profit measure and represents profit from continuing operations before finance costs,
tax and Significant Items. It is presented to assist users of the financial statements to better understand Brambles' business
results.
The Corporate segment includes US$21.2 million of BXB Digital costs (2020: US$16.4 million) and US$35.7 million of Shaping
Our Future costs (2020: US$12.4 million) relating to investment in customer experience, as well as overheads relating to
supply chain efficiency projects and consultancy costs. The Corporate segment in 2020 included the benefit from a foreign
exchange gain of US$4.5 million.
81
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 2. Segment Information – Continuing Operations – continued
By operating segment
CHEP Americas
CHEP EMEA
CHEP Asia-Pacific
Corporate7
Return on
Capital Invested5
2021
2020
US$m
US$m
Average Capital
Invested6
2021
US$m
2020
US$m
15.7%
23.8%
25.7%
14.5%
22.4%
24.1%
2,449.4
1,943.5
569.6
(24.6)
2,368.6
1,830.1
490.6
9.4
Continuing operations
17.8%
17.0%
4,937.9
4,698.7
5
6
7
Return on Capital Invested (ROCI) is Underlying Profit divided by Average Capital Invested. ROCI is not disclosed for the
Corporate segment as it is not deemed a relevant measure for the segment. ROCI for continuing operations includes the
Corporate segment.
Average Capital Invested (ACI) is a 12-month average of capital invested. Capital invested is calculated as net assets before
tax balances, cash, term deposits, lease liabilities and borrowings but after adjustment for pension plan actuarial gains and
losses and net equity-settled share-based payments.
ACI for the Corporate segment includes US$14.4 million deferred consideration receivable from First Reserve
(2020: US$14.4 million), net of the impairment recognised in June 2020 (refer Note 11). The reduction in ACI is primarily due
to the full-year impact of the June 2020 impairment.
Capital
expenditure8
Depreciation
and amortisation
By operating segment
CHEP Americas
CHEP EMEA
CHEP Asia-Pacific
Corporate
2021
US$m
709.2
377.0
132.8
-
2020
US$m
544.9
346.1
77.4
-
2021
US$m
340.9
245.6
73.1
5.4
Continuing operations
1,219.0
968.4
665.0
8
Capital expenditure on property, plant and equipment is on an accruals basis.
2020
US$m
321.2
221.2
61.0
4.3
607.7
82
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 2. Segment Information – Continuing Operations – continued
By operating segment
CHEP Americas
CHEP EMEA
CHEP Asia-Pacific
Corporate
Continuing operations
Discontinued operations
Segment assets
Segment liabilities
2021
US$m
2020
US$m
2021
US$m
2020
US$m
3,578.5
3,205.4
1,523.4
1,289.9
2,512.0
2,257.7
735.3
103.0
590.1
66.0
676.5
288.3
63.5
585.8
204.6
46.6
6,928.8
6,119.2
2,551.7
2,126.9
-
52.7
-
Total segment assets and liabilities
6,928.8
6,171.9
2,551.7
Cash and borrowings
Term deposits
Current tax balances
Deferred tax balances
408.5
737.3
1,750.5
-
12.6
118.0
68.6
9.1
96.3
-
67.6
408.9
2.5
2,129.4
1,813.5
-
45.8
338.1
Total assets and liabilities
7,467.9
7,083.2
4,778.7
4,326.8
Non-current assets by geographic origin9
Americas
Europe
Australia
Other
Total
3,064.5
1,830.0
506.0
500.1
2,798.6
1,716.1
361.3
415.0
5,900.6
5,291.0
9
Non-current assets exclude financial instruments of US$7.1 million (2020: US$9.7 million) and deferred tax assets of
US$118.0 million (2020: US$96.3 million).
83
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 3. Operating Expenses – Continuing Operations
Note
2021
US$m
827.5
2020
US$m
730.5
1,253.0
1,105.5
1,133.4
1,000.0
339.6
54.0
646.4
198.3
18.6
4.4
74.9
305.6
52.4
590.6
154.7
17.1
(6.0)
71.1
4,522.2
4,049.4
Employment costs
Service suppliers:
- transport
- repairs and maintenance1
- subcontractors and other service suppliers
Occupancy
Depreciation of property, plant and equipment
14 & 15
Irrecoverable pooling equipment provision expense
Amortisation of intangible assets
Net foreign exchange losses/(gains)
Other
1
Includes the cost of raw materials used for repairs.
84
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 4. Significant Items – Continuing Operations
Significant Items are items of income or expense which are, either individually or in aggregate, material to Brambles or to the
relevant business segment and:
- outside the ordinary course of business (e.g. gains or losses on the sale or termination of operations, the cost of significant
reorganisations or restructuring); or
- part of the ordinary activities of the business but unusual due to their size and nature.
Significant Items are disclosed to assist users of the financial statements to better understand Brambles’ business results.
2021
US$m
2020
US$m
Before tax
Tax
After tax
Before tax
Tax
After tax
Items outside the ordinary course of business:
- United Kingdom tax rate change1
-
(22.7)
(22.7)
Significant Items from continuing
operations
1
-
(22.7)
(22.7)
-
-
-
-
-
-
The United Kingdom corporate tax rate will increase from 19% to 25% with effect from 1 April 2023. As a consequence,
deferred tax balances have been revalued and a $22.7 million tax charge has been recognised as a Significant Item.
Note 5. Net Finance Costs – Continuing Operations
Finance revenue
Bank accounts and short-term deposits
Derivative financial instruments
Other
Finance costs
Interest expense on bank loans and borrowings
Derivative financial instruments
Lease interest expense
Other
Net finance costs
2021
US$m
3.4
6.6
-
10.0
(54.5)
(14.4)
(26.4)
(0.3)
(95.6)
(85.6)
2020
US$m
15.7
6.4
2.9
25.0
(55.7)
(20.2)
(27.8)
(2.1)
(105.8)
(80.8)
Finance revenue is recognised as the interest accrues (using the effective interest method, which is the rate that exactly
discounts estimated future cash receipts through the expected life of the financial instrument to the net carrying amount of the
financial asset).
Finance costs are recognised as expenses in the year in which they are incurred.
85
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 6. Income Tax
A) Components of Tax Expense
Amounts recognised in the statement of comprehensive income
Current income tax – continuing operations:
- income tax charge
- prior year adjustments
Deferred tax – continuing operations:
- origination and reversal of temporary differences
- previously unrecognised tax losses
- tax rate change
- prior year adjustments
Note
2021
US$m
2020
US$m
218.1
(7.8)
210.3
18.0
(2.6)
23.1
9.9
48.4
258.7
(0.2)
258.5
(3.9)
(3.9)
199.5
1.3
200.8
29.6
(10.5)
(1.3)
(8.0)
9.8
210.6
(8.3)
202.3
(1.9)
(1.9)
Tax expense – continuing operations
Tax benefit – discontinued operations
Tax expense recognised in profit or loss
Amounts recognised in other comprehensive income
- on actuarial gain/loss on defined benefit pension plans1
Tax benefit recognised directly in other comprehensive income
10
1
The tax benefit on defined benefit pension plans in 2021 includes the impact of the change in the corporate tax rate in the
United Kingdom (refer Note 4).
The income tax expense or benefit for the year is the tax payable or receivable on the current year’s taxable income based on
the national income tax rate for each jurisdiction, adjusted by changes in deferred tax assets and liabilities attributable to
temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements,
and to unused tax losses.
Current and deferred tax attributable to other comprehensive income is recognised in equity.
86
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 6. Income Tax – continued
B) Reconciliation Between Tax Expense and Accounting Profit Before Tax
Profit before tax – continuing operations
Tax at standard Australian rate of 30% (2020: 30%)
Effect of tax rates in other jurisdictions
Prior year adjustments
Prior year tax losses written-off
Current year tax losses not recognised
Foreign withholding tax unrecoverable
Change in tax rates
Non-deductible expenses
Other taxable items2
Prior year tax losses recouped/recognised
Other
Tax expense – continuing operations
Tax benefit – discontinued operations
Total income tax expense
Note
10
2021
US$m
793.7
238.1
(32.5)
2.1
-
4.6
10.4
23.1
10.8
4.3
(2.6)
0.4
258.7
(0.2)
258.5
2020
US$m
718.6
215.6
(30.3)
(6.8)
0.1
3.9
10.3
(1.3)
7.3
24.3
(10.5)
(2.0)
210.6
(8.3)
202.3
2
Includes the impact of Base Erosion and Anti-abuse Tax (BEAT) in the US, relating to foreign payments effective 1 July 2018.
2021
US$m
2020
US$m
Assets
Liabilities
Assets
Liabilities
C) Components of Deferred Tax Assets and Liabilities
Deferred tax assets and liabilities in the balance sheet are represented by cumulative temporary differences attributable to:
Items recognised through the statement of comprehensive income
Employee benefits
Provisions and accruals
Losses available against future taxable income
23.8
35.5
183.4
-
-
-
21.6
38.2
134.3
-
-
-
Accelerated depreciation for tax purposes
-
(667.7)
-
(569.0)
Deferred revenue
Leases
Other
108.6
204.9
52.9
609.1
Items recognised in other comprehensive income or directly through equity
Actuarial losses/(gains) on defined benefit pension plans
Share-based payments
10.3
8.9
19.2
-
(160.4)
(89.8)
(917.9)
(1.3)
-
(1.3)
Set-off against deferred tax (liabilities)/assets
Net deferred tax assets/(liabilities)
(510.3)
510.3
118.0
(408.9)
100.1
202.0
79.8
576.0
7.2
5.9
13.1
(492.8)
96.3
-
(155.9)
(105.8)
(830.7)
(0.2)
-
(0.2)
492.8
(338.1)
87
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 6. Income Tax – continued
2021
US$m
2020
US$m
Assets
Liabilities
Assets
Liabilities
D) Movements in Deferred Tax Assets and Liabilities
At 1 July
96.3
(338.1)
73.6
(353.1)
Credited/(charged) to profit or loss
Credited/(charged) directly to equity
Divestment of subsidiaries
Adoption of new accounting standards
Offset against deferred tax (liabilities)/assets
Foreign exchange differences
At 30 June
2.9
5.5
-
-
3.7
9.6
(54.9)
(0.8)
4.4
-
(3.7)
(15.8)
118.0
(408.9)
(105.5)
(0.2)
-
210.5
(79.1)
(3.0)
96.3
95.6
(0.1)
-
(166.4)
79.1
6.8
(338.1)
Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences between the
carrying amounts of assets and liabilities in the financial statements and the corresponding tax basis used in the computation
of taxable profit, calculated using tax rates which are enacted or substantively enacted by the balance sheet date.
Deferred tax assets and liabilities are not recognised:
-
where the deferred tax arises from the initial recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; or
-
in respect of temporary differences associated with investments in subsidiaries and associates where the timing of the
reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in
the foreseeable future.
Deferred tax assets are recognised for carried forward tax losses to the extent that the entity has sufficient taxable temporary
differences or there is convincing evidence that sufficient taxable profit will be available against which the unused tax losses
can be utilised. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent
that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax assets to be
utilised.
At reporting date, Brambles has unused tax losses of US$858.9 million (2020: US$660.4 million) available for offset against
future profits. A deferred tax asset of US$183.4 million (2020:US$134.3 million) has been recognised in respect of
US$737.1 million (2020: US$536.5 million) of such losses.
The benefit for tax losses will only be obtained if:
-
Brambles derives future assessable income of a nature and of an amount sufficient to enable the benefit from the
deductions for the losses to be realised;
-
-
Brambles continues to comply with the conditions for deductibility imposed by tax legislation; and
no changes in tax legislation adversely affect Brambles in realising the benefit from the deductions for the losses.
No deferred tax asset has been recognised in respect of the remaining unused tax losses of US$121.8 million
(2020: US$123.9 million) due to the unpredictability of future profit streams in the relevant jurisdictions. Tax losses of
US$431.1 million (2020: US$431.1 million), which have been recognised in the balance sheet, have an expiry date between
2031 and 2038 (2020: between 2031 and 2038), however it is expected that these losses will be recouped prior to expiry. The
remaining tax losses of US$306.0 million (2020: US$105.4 million), which have been recognised in the balance sheet, can be
carried forward indefinitely.
88
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 6. Income Tax – continued
D) Movements in Deferred Tax Assets and Liabilities – continued
At reporting date, undistributed earnings of subsidiaries for which deferred tax liabilities have not been recognised in the
consolidated financial statements are US$948.9 million (2020: US$961.3 million). No deferred tax liability has been recognised
for these amounts because Brambles controls the distributions from its subsidiaries and is satisfied that the temporary
difference will not reverse in the foreseeable future.
The majority of the deferred tax assets and liabilities are expected to be recovered/realised beyond 12 months after the
balance sheet date.
E) Tax Consolidation
Brambles Limited and its Australian subsidiaries formed a tax consolidated group in 2006. Brambles Limited, as the head entity
of the tax consolidated group, and its Australian subsidiaries have entered into a tax sharing agreement in order to allocate
income tax expense. The tax sharing agreement uses a stand-alone basis of allocation. Consequently, Brambles Limited and its
Australian subsidiaries account for their own current and deferred tax amounts as if they each continue to be taxable entities
in their own right. In addition, the agreement provides funding rules setting out the basis upon which subsidiaries are to
indemnify Brambles Limited in respect of tax liabilities and the methodology by which subsidiaries in tax loss are to be
compensated.
F) Tax Estimates and Judgements
Brambles is a global Group and is subject to income taxes in many jurisdictions around the world. Significant judgement is
required in determining the provision for income taxes on a worldwide basis. There are many transactions and calculations
undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. Brambles recognises
liabilities for uncertain tax positions in accordance with IFRS interpretation IFRIC 23. Where the final tax outcome of these
matters is different from amounts provided, such differences will impact the current and deferred tax provisions in the period
in which such outcome is determined.
In addition, Brambles regularly assesses the recognition and recoverability of deferred tax assets. This requires judgements
about the application of income tax legislation in jurisdictions in which Brambles operates. Changes in circumstances may
alter expectations and affect the carrying amount of deferred tax assets. The carrying amount of deferred tax assets is
reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will
be available to allow all or part of the deferred tax asset to be utilised.
G) Tax Policy
Brambles Limited has a tax policy approved by the Board of Directors, which sets out the Company’s approach to tax risk
management and governance, tax planning, and dealing with tax authorities. The tax policy is included in Brambles Limited’s
Code of Conduct. In addition, Brambles Limited’s Sustainability Review includes a Tax Transparency Report, prepared in
accordance with the Australian Taxation Office's Voluntary Tax Transparency Code, which comprises, amongst other matters,
details such as the corporate income tax paid by, and effective tax rates of, Brambles' Australian and global operations. The
2021 Tax Transparency Report is scheduled for publication in the second half of calendar year 2021 and will be posted on
Brambles’ website.
89
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 7. Earnings Per Share
From continuing operations
- basic
- diluted
- basic, on Underlying Profit after finance costs and tax
From discontinued operations
- basic
- diluted
Total Earnings Per Share (EPS)
- basic
- diluted
2021
US cents
2020
US cents
36.3
36.1
37.8
(0.6)
(0.6)
35.7
35.5
32.8
32.7
32.8
(3.9)
(3.9)
28.9
28.8
Basic EPS is calculated as net profit attributable to members of the parent entity, adjusted to exclude costs of servicing equity
(other than dividends), divided by the weighted average number of ordinary shares.
Diluted EPS is calculated as net profit attributable to members of the parent entity, adjusted for:
-
-
-
costs of servicing equity (other than dividends) and preference share dividends;
the after-tax effect of dividends and finance costs associated with dilutive potential ordinary shares that have been
recognised as expenses;
other non-discretionary changes in revenue or expenses during the year that would result from the dilution of potential
ordinary shares;
and divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus
element.
Performance share rights and MyShare matching conditional rights granted under Brambles' share plans are considered to be
potential ordinary shares and have been included in the determination of diluted EPS to the extent they are considered to be
dilutive.
EPS on Underlying Profit after finance costs and tax is calculated as Underlying Profit after finance costs and tax attributable
to members of the parent entity, divided by the weighted average number of ordinary shares.
90
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 7. Earnings Per Share – continued
A) Weighted Average Number of Shares during the Year
Used in the calculation of basic EPS
Adjustment for share rights
Used in the calculation of diluted EPS
B) Reconciliations of Profit used in EPS Calculations
Statutory profit
Profit from continuing operations
Loss from discontinued operations
Profit used in calculating basic and diluted EPS
Underlying Profit after finance costs and tax
Underlying Profit (Note 2)
Net finance costs (Note 5)
Underlying Profit after finance costs before tax
Tax expense on Underlying Profit
Underlying Profit after finance costs and tax
Which reconciles to statutory profit:
Underlying Profit after finance costs and tax
Significant Items after tax (Note 4)
Profit from continuing operations
2021
Million
1,475.1
5.1
1,480.2
2021
US$m
535.0
(8.9)
526.1
879.3
(85.6)
793.7
(236.0)
557.7
557.7
(22.7)
535.0
2020
Million
1,548.7
4.7
1,553.4
2020
US$m
508.0
(60.0)
448.0
799.4
(80.8)
718.6
(210.6)
508.0
508.0
-
508.0
91
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 8. Dividends
A) Dividends Paid during the Year
Dividend per share (US cents)
Cost (in US$ million)
Payment date
Interim
2021
10.0
148.3
Final
2020
9.0
132.5
8 April 2021
8 October 2020
Effective from 1 July 2019, Brambles moved to a US dollar payout ratio based dividend policy, targeting a payout ratio of
45-60% of Underlying Profit after finance costs and tax, subject to Brambles' cash requirements, with the dividend per share
declared in US cents and converted and paid in Australian cents based on an average exchange rate just prior to the dividend
declaration.
Total dividends paid during the year of US$280.8 million (2020: US$473.9 million inclusive of a special dividend of
US$183.2 million) per the consolidated cash flow statement differ from the amount recognised in the consolidated statement
of changes in equity of US$287.0 million (2020: US$471.9 million) due to the impact of foreign exchange movements between
the dividend record and payment dates. The Dividend Reinvestment Plan (DRP) remained suspended in 2021.
B) Dividend Declared after 30 June 2021
Dividend per share (in US cents)
Estimated cost (in US$ million)
Payment date
Dividend record date
Final
2021
10.5
151.3
14 October 2021
9 September 2021
As this dividend had not been declared at 30 June 2021, it is not reflected in these financial statements. A provision for
dividends is only recognised where the dividends have been declared prior to the reporting date.
Total ordinary dividends declared for 2021 were 20.5 US cents per share, representing a payout ratio of 54% which is broadly
in line with the prior year payout ratio of 53%. The 2020 total ordinary dividends were 18.0 US cents per share.
C) Franking Credits
Franking credits available for subsequent financial years
2021
US$m
61.6
2020
US$m
33.2
The amounts above represent the balance of the franking account as at the end of the year, adjusted for:
- franking credits that will arise from the payment of the current tax liability;
- franking debits that will arise from the payment of dividends recognised as a liability at the reporting date;
- franking credits that will arise from dividends recognised as receivable at the reporting date; and
- franking credits that may be prevented from being distributed in subsequent financial years.
The final 2021 dividend will be franked at 30%.
Note 9. Investments
On 10 February 2021, Brambles entered into an agreement to combine its Kegstar keg rental business with MicroStar, a
leading US beer keg solution provider, with completion of the transaction taking place on 16 April 2021. As consideration
Brambles received a 16% interest in MicroStar which is accounted for as an associate using the equity method.
The value of the investment in MicroStar at 30 June 2021, inclusive of the post-acquisition loss of US$0.6 million, is
US$53.9 million.
92
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 10. Discontinued Operations
Following the merger of Kegstar with MicroStar on 16 April 2021 (refer Note 9), the results of Kegstar up until the date of
divestment and in the comparative period have been included in discontinued operations in the consolidated statement of
comprehensive income and all related note disclosures. The assets and liabilities of Kegstar were divested at completion of
the merger and the comparative balance sheet and related notes remain unchanged.
The carrying amount of Kegstar assets and liabilities at divestment date were:
Assets
Cash and cash equivalents
Property, plant and equipment
Other assets
Total assets
Liabilities
Trade and other liabilities
Total liabilities
Net Assets
Financial information for discontinued operations is summarised below:
Operating results (excluding loss on divestment) relate to:
- Kegstar1
-
Impairment of receivable2
- Other discontinued operations
Loss before tax (excluding loss on divestment)
Loss on divestment of Kegstar3
Total loss before tax
Tax benefit
Loss from discontinued operations
Net cash outflow from operating activities
Net cash outflow from investing activities4
Net decrease in cash and cash equivalents
At date of
divestment
US$m
3.1
52.9
2.2
58.2
5.3
5.3
52.9
2021
US$m
(5.6)
-
(1.6)
(7.2)
(1.9)
(9.1)
0.2
(8.9)
(5.7)
(11.0)
(16.7)
June
2020
US$m
1.7
51.3
2.3
55.3
2.5
2.5
52.8
2020
US$m
(32.4)
(33.0)
(2.9)
(68.3)
-
(68.3)
8.3
(60.0)
(3.7)
(29.7)
(33.4)
1
2
3
Kegstar operating results include US$7.2 million of sales revenue (2020: US$15.7 million) and US$2.7 million of
depreciation and amortisation (2020: US$4.5 million). Operating results in 2020 include a US$28.0 million impairment
charge recognised as a Significant Item outside the ordinary course of business.
The 2020 impairment relates to deferred consideration receivable from First Reserve and was recognised as a Significant
Item outside the ordinary course of business (refer Note 11).
The loss on divestment of Kegstar is recognised as a Significant Item outside the ordinary course of business and includes
a loss of US$3.3 million relating to exchange differences released to profit (refer Note 23) and US$0.7 million of
transaction costs.
93
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 10. Discontinued Operations – continued
4
Net cash outflow from investing activities in 2021 include US$9.5 million of costs paid on disposal of Kegstar and prior
period divestments (2020: includes US$16.0 million costs paid on disposal of IFCO and the balance pertains to Kegstar).
In addition to the 2021 Kegstar divestment and the 2020 impairment adjustments, discontinued operations comprise other net
adjustments relating to prior periods.
Note 11. Trade and Other Receivables
Current
Trade receivables
Allowance for doubtful receivables
Net trade receivables
Other debtors
Unbilled revenue
Total trade and other receivables
Non-current
Other receivables1
2021
US$m
640.6
(17.2)
623.4
100.0
127.8
851.2
23.6
23.6
2020
US$m
548.1
(17.2)
530.9
74.5
111.8
717.2
23.3
23.3
1
Other receivables in 2021 and 2020 include deferred consideration receivable from First Reserve of US$14.4 million net of an
impairment charge taken up in June 2020.
Trade receivables with no significant financing component are recognised when services are provided and settlement is
expected within normal credit terms. Trade receivables are non-interest bearing and are generally on 30–90 day terms.
Other receivables are initially recognised at fair value plus any directly attributable transaction costs and subsequently
measured at amortised cost.
The allowance for doubtful receivables has been established based on AASB 9 Financial Instruments. For all eligible trade and
other receivables, Brambles applies the simplified approach to measuring expected credit losses, which uses a lifetime expected
loss allowance. To measure the expected credit losses, trade and other receivables are grouped based on region and ageing.
Customers with heightened credit risk are provided for specifically based on historical default rates and forward-looking
information. Customers with normal credit risk are provided for in line with a provision matrix based on ageing and their
associated risk. A lifecycle allowance is calculated on the remaining trade and other receivables balance based on historical bad
debt levels. Where there is no reasonable expectation of recovery, balances are written off. Subsequent recovery of amounts
previously written off are credited against other expenses in the consolidated statement of comprehensive income. An
allowance of US$4.6 million (2020: US$7.3 million) has been recognised as an expense in the current year for trade and other
receivables in line with the Group accounting policy.
Other debtors primarily comprise GST/VAT recoverable and loss compensation receivables.
94
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 11. Trade and Other Receivables – continued
Trade receivables
Other debtors
2021
US$m
2020
US$m
2021
US$m
2020
US$m
At 30 June, the ageing analysis of trade receivables and other debtors by reference to due dates was as follows:
Not past due
Past due 0–30 days but not impaired
Past due 31–60 days but not impaired
Past due 61–90 days but not impaired
Past 90 days but not impaired
Impaired
598.5
18.0
4.3
2.5
0.1
17.2
640.6
489.2
26.0
7.6
2.6
5.5
17.2
548.1
86.1
60.6
6.8
0.7
3.3
3.1
-
2.3
1.3
1.3
9.0
-
100.0
74.5
Refer to Note 24 for other financial instrument disclosures.
Note 12. Inventories
Raw materials and consumables
Finished goods
2021
US$m
73.1
6.4
79.5
2020
US$m
59.2
8.3
67.5
Inventories are valued at the lower of cost and net realisable value and, where appropriate, a provision is made for possible
obsolescence.
Cost is determined on a weighted-average basis and, where relevant, includes an appropriate portion of overhead expenditure.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and
costs to make the sale.
Note 13. Other Assets
Current
Prepayments
Current tax receivable
Derivative financial instruments
Non-current
Derivative financial instruments
Refer to Note 24 for other financial instrument disclosures.
2021
US$m
86.2
12.6
4.2
103.0
7.1
7.1
2020
US$m
74.4
9.1
12.1
95.6
9.7
9.7
95
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 14. Property, Plant and Equipment
A) Net Carrying Amounts and Movements during the Year
2021
US$m
2020
US$m
Land and
Plant and
Land and
Plant and
buildings
equipment
Total
buildings
equipment
Total
Opening carrying amount
Additions1
Acquisition of forestry assets
Divestment of subsidiaries
Disposals
Depreciation charge2
Impairment charge3
IPEP expense4
Foreign exchange differences
Closing carrying amount
At 30 June
Cost
Accumulated depreciation5
Accumulated impairment3
46.8
16.4
4.7
-
(0.1)
(5.1)
-
-
4.8
67.5
4,362.5
4,409.3
1,203.0
1,219.4
10.8
(52.9)
(157.6)
(514.1)
-
15.5
(52.9)
(157.7)
(519.2)
-
(199.8)
(199.8)
213.8
218.6
4,865.7
4,933.2
119.6
7,065.6
7,185.2
(52.1)
(2,199.9)
(2,252.0)
-
-
-
Net carrying amount
67.5
4,865.7
4,933.2
43.3
10.4
-
-
(0.1)
(4.5)
-
-
(2.3)
46.8
92.1
(45.3)
-
46.8
4,269.9
4,313.2
970.8
981.2
-
-
(107.0)
(473.0)
(3.0)
(155.7)
(139.5)
-
-
(107.1)
(477.5)
(3.0)
(155.7)
(141.8)
4,362.5
4,409.3
6,530.6
6,622.7
(2,165.1)
(2,210.4)
(3.0)
(3.0)
4,362.5
4,409.3
1
2
3
4
In 2021 capital expenditure related to discontinued operations is US$0.4 million (2020: US$12.8 million).
In 2021 depreciation charge related to discontinued operations is U$2.5 million (2020: US$3.3 million).
In 2020 an impairment charge of US$3.0 million was recognised in the Kegstar keg-pooling business in relation to plant and
equipment, reflecting the impact of COVID-19 and uncertainties over on-premise consumption and performance of the craft
beer segment.
In 2021 IPEP expense related to discontinued operations is US$1.5 million (2020: US$1.0 million).
5 Includes IPEP of US$86.4 million (2020: US$105.7 million).
The net carrying amounts above include capital work in progress of US$140.3 million (2020: US$129.0 million).
B) Recognition and Measurement
Property, plant and equipment (PPE) is stated at cost, net of depreciation and any impairment, except land, which is shown at cost
less impairment. Cost includes expenditure that is directly attributable to the acquisition of assets and, where applicable, an initial
estimate of the cost of dismantling and removing the item and restoring the site on which it is located.
Subsequent expenditure is capitalised only when it is probable that future economic benefits associated with the expenditure will
flow to Brambles. Repairs and maintenance are expensed in the consolidated statement of comprehensive income in the period
they are incurred.
PPE is derecognised upon disposal or when no future economic benefits are expected to arise from continued use of the asset.
Any net gain or loss arising on derecognition of the asset is included in the statement of comprehensive income and presented
within other income/operating expenses in the period in which the asset is derecognised.
96
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 14. Property, Plant and Equipment – continued
C) Depreciation of Property, Plant and Equipment
Depreciation is recognised on a straight-line or reducing balance basis on all PPE (excluding land) over their expected useful lives.
The useful economic life and residual value of PPE is reviewed on an annual basis considering key assumptions including forecast
usage, changes in technology, physical condition and potential climate change implications. No material changes have been
recognised in 2021 or 2020. The expected useful lives of PPE are generally:
- buildings: up to 50 years;
- pooling equipment: 5–10 years; and
- other plant and equipment: 3–20 years.
The cost of improvements to leasehold properties is amortised over the unexpired portion of the lease, or the estimated useful
life of the improvements to Brambles, whichever is shorter.
D) Irrecoverable Pooling Equipment Provision
Loss is an inherent risk of pooling equipment operations. Brambles’ pooling equipment operations around the world differ in
terms of business models, market dynamics, customer and distribution channel profiles, contractual arrangements and
operational details. Brambles monitors its pooling equipment operations using detailed key performance indicators (KPIs) and
conducts audits continually to confirm the existence and the condition of its pooling equipment assets and to validate its
customer hire records. During these audits, which take place at Brambles' plants, customer sites and other locations, pooling
equipment is counted on a sample basis and reconciled to the balances shown in Brambles’ customer hire records. The
irrecoverable pooling equipment provision (IPEP) is subject to a number of judgements and estimates, which are informed by
historical statistical data in each market, including the outcome of audits and relevant KPIs. The impact of COVID-19 has been
considered in estimating IPEP including updating the key assumptions for the latest estimated and actual loss rates. IPEP is
presented within accumulated depreciation.
E) Recoverable Amount of Non-current Assets
At each reporting date, Brambles assesses whether there is any indication that an asset, or Cash Generating Unit (CGU) to which
the asset belongs, may be impaired. Where an indicator of impairment exists, Brambles makes a formal estimate of the
recoverable amount. The recoverable amount of goodwill is tested for impairment annually (refer Note 16D). The recoverable
amount of an asset is the greater of its fair value less costs to sell and its value in use.
Value in use is determined as the estimated future cash flows discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks specific to the asset.
Where the carrying value of an asset exceeds its recoverable amount, the asset is considered to be impaired and is written down
to its recoverable amount. The impairment loss is recognised in the consolidated statement of comprehensive income in the
reporting period in which the write-down occurs.
Consideration has been given to the potential financial impacts of climate change related risks on the carrying value of PPE and
other non-current assets through a qualitative review of Brambles' climate change risks and mitigating actions. This review did
not identify any material financial reporting impacts.
97
Consolidated Financial Report 37.5
18.8
-
(0.7)
(15.2)
(2.7)
37.7
52.9
(15.2)
37.7
2021
US$m
5.5
0.4
5.9
Total
632.0
70.6
-
27.0
(116.4)
(14.4)
598.8
715.2
(116.4)
598.8
2020
US$m
7.2
0.4
7.6
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 15. Right-of-Use Leased Assets
A) Net Carrying Amount and Movements during the Year
2021
US$m
Land and
buildings
Plant and
equipment
Opening carrying amount
Additions
Divestment of subsidiaries
Remeasurement of existing leases
561.1
72.9
(0.5)
12.4
37.7
26.6
-
1.9
Total
598.8
99.5
(0.5)
14.3
2020
US$m
Land and
buildings
Plant and
equipment
594.5
51.8
-
27.7
Depreciation
(111.1)
(18.6)
(129.7)
(101.2)
Foreign exchange differences
Closing carrying amount
At 30 June
Cost
Accumulated depreciation
Net carrying amount
23.8
558.6
767.5
(208.9)
558.6
1.9
49.5
82.8
(33.3)
49.5
25.7
608.1
850.3
(242.2)
608.1
(11.7)
561.1
662.3
(101.2)
561.1
B) Leases Exempt from AASB 16 in Accordance with the Standard
Short-term lease expense
Low-value assets lease expense
Exempt lease expense
The value of short-term lease commitments for 2022 is consistent with 2021.
98
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 15. Right-of-Use Leased Assets – continued
C) Measurement of the Right-of-Use Leased Asset and Lease Liability
The Group primarily leases offices, service centres, equipment and vehicles. Rental contracts are typically made for fixed periods,
but may have extension or termination options. Lease terms are negotiated on an individual basis and contain a range of
different terms and conditions.
Leases are recognised as a right-of-use leased asset and a corresponding lease liability at the date the leased asset is available
for use by the Group. Principal and interest payments are reflected in the consolidated cash flow statement as financing and
operating activities, respectively.
Assets and liabilities arising from a lease are initially measured at present value. Lease liabilities include the present value of:
- fixed lease payments less any incentives receivable;
- variable payments based on a rate or index; and
- amounts expected to be payable relating to residual value guarantees, early termination penalties, and purchase options if
reasonably certain of taking place.
Lease payments are discounted using the incremental borrowing rate calculated by geographic region. The incremental
borrowing rate is the rate the lessee would have to pay to borrow the funds necessary to obtain an asset of similar value in a
similar economic environment with similar terms and conditions.
The Group is required to remeasure the lease liability and make an adjustment to the right-of-use leased asset if the lease terms
and conditions are modified, in which case the lease liability is remeasured by discounting the revised lease payments. The
remeasurement of the lease liability is also applied against the right-of-use leased asset.
Right-of-use leased assets are measured at cost comprising the following:
- the amount of the initial measurement of the lease liability;
- any lease payments made at or before the commencement date, less any lease incentives received;
- any initial direct costs; and
- dilapidation costs.
The right-of-use leased asset is depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis.
99
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 16. Goodwill and Intangible Assets
A) Net Carrying Amounts and Movements during the Year
2021
US$m
2020
US$m
Goodwill
Software
Other1
Total
Goodwill
Software
Other1
Total
Opening carrying amount
192.5
Additions
Disposals
Divestment of subsidiaries
Amortisation charge2
Impairment charge3
Foreign exchange
differences
-
-
-
-
-
15.3
40.3
21.1
-
-
(10.7)
-
-
26.8
259.6
220.8
2.4
-
(0.2)
(8.1)
-
23.5
-
(0.2)
(18.8)
-
-
-
-
-
(23.0)
36.0
15.1
-
-
(10.1)
(0.6)
2.4
17.7
(5.3)
(0.1)
29.4
286.2
7.5
(0.1)
-
(8.2)
(1.4)
(0.4)
22.6
(0.1)
-
(18.3)
(25.0)
(5.8)
Closing carrying amount
207.8
50.7
23.3
281.8
192.5
40.3
26.8
259.6
At 30 June
Gross carrying amount
207.8
203.4
78.9
490.1
215.5
176.9
72.9
465.3
Accumulated amortisation
Accumulated impairment3
-
-
Net carrying amount
207.8
50.7
23.3
281.8
-
-
-
(23.0)
192.5
(0.6)
40.3
(1.4)
26.8
(25.0)
259.6
(152.7)
(55.6)
(208.3)
-
(136.0)
(44.7)
(180.7)
1
2
3
Other intangible assets primarily comprise acquired customer relationships, customer lists and agreements, and BXB Digital
capitalised costs.
In 2021 amortisation charge related to discontinued operations is US$0.2 million (2020: US$1.2 million).
An impairment charge of US$25.0 million was recognised in 2020 in the Kegstar keg-pooling business reflecting the impact of
COVID-19 and industry uncertainties.
100
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 16. Goodwill and Intangible Assets – continued
B) Summary of Carrying Value of Goodwill by CGU
CHEP Europe
CHEP Asia-Pacific
CHEP Americas
Total goodwill
C) Recognition and Measurement
2021
US$m
138.8
57.6
11.4
2020
US$m
129.4
53.0
10.1
207.8
192.5
Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of Brambles’ share of the net identifiable assets of
the acquired subsidiary or associate at the date of acquisition. Goodwill on acquisitions of subsidiaries and associates is included
in intangible assets and investments in associates, respectively. Goodwill is carried at cost less accumulated impairment losses and
is not amortised.
Upon acquisition, any goodwill arising is allocated to each CGU expected to benefit from the acquisition. On disposal of an
operation, goodwill associated with the disposed operation is included in the carrying amount of the operation when determining
the gain or loss on disposal.
Other intangible assets
Intangible assets acquired are capitalised at cost, unless acquired as part of a business combination, in which case they are
capitalised at fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at cost less
provisions for amortisation and impairment.
The costs of acquiring computer software for internal use are capitalised as intangible non-current assets where it is used to
support a significant business system and the expenditure leads to the creation of an asset.
Useful lives have been established for all non-goodwill intangible assets. Amortisation charges are expensed in the consolidated
statement of comprehensive income on a straight-line basis over those useful lives. Estimated useful lives are reviewed annually.
The expected useful lives of intangible assets are generally:
- customer lists and relationships: 3–10 years; and
- computer software: 3–10 years.
There are no non-goodwill intangible assets with indefinite lives.
Intangible assets are tested for impairment where an indicator of impairment exists, either individually or at the CGU level.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognised in the consolidated statement of comprehensive income when
the asset is derecognised.
101
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 16. Goodwill and Intangible Assets – continued
D) Goodwill Recoverable Amount Testing
Brambles’ business units undertake an impairment review process annually to ensure that goodwill balances are not carried at
amounts that are in excess of their recoverable amounts. This review may be undertaken more frequently if events or changes
indicate that goodwill may be impaired.
The recoverable amount of goodwill is determined based on the higher of the value in use and the fair value less costs to sell
calculations undertaken at the CGU level. The value in use is calculated using a discounted cash flow methodology covering a
four-year period, including the impact of COVID-19, with an appropriate terminal value at the end of that period.
Consideration has been given to the potential financial impacts of climate change related risks on the carrying value of goodwill
through a qualitative review of Brambles' climate change risks and mitigating actions. This review did not identify any material
financial reporting impacts.
Based on the impairment testing, the carrying amount of goodwill in the CGUs at reporting date was fully supported. The key
assumptions on which management has based its cash flow projections were:
Cash flow forecasts
Cash flow forecasts are post-tax and based on the most recent financial projections covering a maximum period of four years.
Financial projections are based on assumptions that represent management’s best estimates.
Revenue growth rates
Revenue growth rates used are based on management’s latest four-year plan. Four-year growth rates for CHEP Europe and CHEP
Asia-Pacific CGUs were 5.1% and 6.0% respectively. Sensitivity testing was performed on these CGUs and a reasonably possible
decline in these rates would not cause the carrying value of the CGUs to exceed their recoverable amount.
Terminal value
The terminal value calculated is determined using the stable growth model, having regard to the weighted average cost of capital
(WACC) and terminal growth rate appropriate to each CGU. The terminal growth rate used in the financial projections was 1.8% for
CHEP Europe and 2.2% for CHEP Asia-Pacific.
Discount rates (pre-tax)
Discount rates used are the pre-tax WACC and include a premium for market risks appropriate to each country in which the CGU
operates. Weighted average pre-tax WACC used was 7.7% (pre-tax rates: CHEP Europe 7.1% and CHEP Asia-Pacific 9.6%).
Sensitivity
The Brambles pooling equipment business has not been materially impacted by COVID-19 in 2021 as it operates in an essential
services market. Downside scenarios were prepared to sensitise the models and any reasonable change to the above key
assumptions would not cause the carrying value to materially exceed the recoverable amount.
102
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 17. Trade and Other Payables
Current
Trade payables
Other payables
Deferred revenue
Accruals
Derivative financial instruments
Total trade and other payables
2021
US$m
510.5
334.1
460.3
295.1
7.0
2020
US$m
438.4
134.4
422.1
227.3
4.3
1,607.0
1,226.5
Trade payables represent liabilities for goods and services provided to Brambles prior to the end of the financial year that
remain unpaid at the reporting date. The amounts are unsecured, non-interest bearing and are paid within normal credit terms
of 30–150 days.
Other payables include capital expenditure creditors and GST/VAT payable. Other payables (excluding derivatives) are initially
measured at fair value, net of transaction costs incurred, and subsequently measured at amortised cost.
Deferred revenue primarily relates to revenue that is billed on issue of pooling equipment to customers. It is recognised in the
consolidated statement of comprehensive income over the cycle time (refer Note 2). As the cycle time is less than one year, all
deferred revenue from 2020 was recognised in 2021. Deferred revenue in 2021 relates to the transaction price allocated to
performance obligations that remain unsatisfied and will be satisfied in 2022.
Refer to Note 24 for other financial instrument disclosures.
Note 18. Provisions
Employee entitlements
Other1
2021
US$m
2020
US$m
Current
Non-current
Current
Non-current
99.8
16.5
116.3
8.5
74.0
82.5
72.4
12.5
84.9
5.4
70.7
76.1
1
Other includes US$75.7 million relating to dilapidation provisions on leases (2020: US$70.9 million) as well as other
provisions relating to litigation and other known exposures.
Provisions for liabilities are made on the basis that, due to a past event, the business has a constructive or legal obligation to
transfer economic benefits that are of uncertain timing or amount. Provisions are measured at the present value of
management’s best estimate at the balance sheet date of the expenditure required to settle the obligation. The discount rate
used is a pre-tax rate that reflects current market assessments of the time value of money and the risks appropriate to the
liability.
Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost in the
consolidated statement of comprehensive income.
103
Consolidated Financial Report
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 18. Provisions – continued
Employee entitlements are provided by Brambles in accordance with the legal and social requirements of the country of
employment. Principal entitlements are for annual leave, sick leave, long service leave, bonuses and contract entitlements.
Annual leave and sick leave entitlements are presented within other payables.
Liabilities for annual leave, as well as those employee entitlements that are expected to be settled within one year, are measured
at the amounts expected to be paid when they are settled. All other employee entitlement liabilities are measured at the
estimated present value of the future cash outflows to be made in respect of services provided by employees up to the
reporting date.
Employee entitlements are classified as current liabilities unless Brambles has an unconditional right to defer settlement of the
liability for at least 12 months after the balance sheet date.
Note 19. Borrowings
Unsecured
Bank overdrafts
Bank loans
Loan notes
2021
US$m
2020
US$m
Current
Non-current
Current
Non-current
1.5
21.8
9.1
32.4
-
25.3
1,692.8
1,718.1
-
27.5
8.8
36.3
-
149.3
1,627.9
1,777.2
Borrowings are primarily initially recognised at fair value net of transaction costs incurred and are subsequently measured at
amortised cost. Any difference between the borrowing proceeds (net of transaction costs) and the redemption amount is
recognised in the consolidated statement of comprehensive income over the period of the borrowings using the effective
interest method.
Borrowings are classified as current liabilities unless Brambles has an unconditional right to defer settlement of the liability for at
least 12 months after the balance sheet date.
Financial risks and risk management strategies associated with borrowings, including financial covenants, are disclosed in
Note 24.
Note 20. Retirement Benefit Obligations
A) Defined Contribution Plans
Brambles operates a number of defined contribution retirement benefit plans for qualifying employees. The assets of these plans
are held in separately administered trusts or insurance policies. In some countries, Brambles’ employees are members of state-
managed retirement benefit plans. Brambles is required to contribute a specified percentage of payroll costs to the retirement
benefit plan to fund benefits. The only obligation of Brambles with respect to defined contribution retirement benefit plans is to
make the specified contributions. Payments to defined contribution retirement benefit plans are charged as an expense as they
fall due.
US$24.2 million (2020: US$18.0 million) has been recognised as an expense in the consolidated statement of comprehensive
income, representing contributions paid and payable to these plans by Brambles at rates specified in the rules of the plans, all of
which relate to continuing operations.
104
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 20. Retirement Benefit Obligations – continued
B) Defined Benefit Plans
Brambles operates a small number of defined benefit pension plans, which are closed to new entrants. The majority of the plans
are self-administered and the plans’ assets are held independently of Brambles’ finances. Under the plans, members are entitled
to retirement benefits based upon a percentage of final salary. No other post-retirement benefits are provided. The plans are
mostly funded plans.
A liability in respect of defined benefit pension plans is recognised in the balance sheet, measured as the present value of the
defined benefit obligation at the reporting date less the fair value of the pension plans' assets at that date. Pension obligations
are measured as the present value of estimated future cash flows discounted at rates reflecting the yields of high quality
corporate bonds.
The plan assets and the present value of the defined benefit obligations recognised in Brambles’ balance sheet are based upon
the most recent formal actuarial valuations, which have been updated to 30 June 2021 by independent professionally qualified
actuaries and take account of the requirements of AASB 119. For all plans, the valuation updates have used assumptions, assets
and cash flows as at 31 May 2021. There has been no material change in assumptions, assets and cash flows between 31 May
and 30 June. The present value of the defined benefit obligations and past service costs were measured using the projected unit
credit method. Past service cost is recognised immediately to the extent that the benefits are already vested.
Actuarial gains and losses arising from differences between expected and actual returns, and the effect of changes in actuarial
assumptions are recognised in full through other comprehensive income in the period in which they arise.
A net expense of US$2.4 million has been recognised in the consolidated statement of comprehensive income in respect of
defined benefit plans (2020: US$2.2 million), of which US$1.7 million net expense relates to continuing operations
(2020: US$1.6million). Included within the total expense recognised during the year is a one-off Guaranteed Minimum Pension
equalisation adjustment of US$0.2 million (2020: nil) and net interest cost of US$0.4 million (2020: US$0.5 million).
The amounts recognised in the balance sheet are as follows:
Present value of defined benefit obligations
Fair value of plan assets
Net liability recognised in the balance sheet
2021
US$m
327.2
(293.9)
33.3
2020
US$m
299.6
(261.9)
37.7
Currency variations and an increase in the discount rate were the key drivers for the changes in the present value of defined
benefit obligations and the fair value of plan assets. Benefits paid during the period were US$8.0 million (2020: US$6.8 million).
There are a number of principal assumptions used in the actuarial valuations of the defined benefit obligations. These principal
assumptions are the discount rate of 2.0% (2020: 1.6%) for the plans operating in the United Kingdom and 9.4% (2020: 9.2%) for
the South African plan; the pension increase rate of 3.25% - 3.65% (2020: 2.80% - 3.45%) in the United Kingdom plans; and the
inflation rate for the South African plan of 5.73% (2020: 4.75%). A change of 25 basis points in the discount rate or other key
assumptions may have a material impact on the defined benefit obligation.
Brambles has no legal obligation to settle this liability with an immediate contribution or additional one-off contributions.
Brambles intends to continue to make contributions to the plans at the rates recommended by the plans’ actuaries when
actuarial valuations are obtained. Additional annual contributions of US$6.9 million (2020: US$6.2 million) are being paid to
remove the identified deficits over a period of up to seven years (2020: eight years).
105
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 21. Contributed Equity
Total ordinary shares, of no par value, issued and fully paid:
At 1 July 2019
Issued during the year1
Share buy-back2
Shareholder capital return3
At 30 June 2020
At 1 July 2020
Issued during the year1
Share buy-back2
At 30 June 2021
Shares
US$m
1,588,762,375
6,187.4
1,928,769
(85,658,579)
-
14.5
(645.4)
(129.3)
1,505,032,565
5,427.2
1,505,032,565
5,427.2
2,655,384
(66,518,260)
1,441,169,689
20.7
(523.1)
4,924.8
1
2
3
Includes shares issued on exercise of share plans and shares issued as part of the MyShare Dividend Reinvestment Plan.
As announced on 25 February 2019, Brambles will perform an on-market share buy-back of up to US$1.65 billion using the
proceeds from the IFCO divestment. The cumulative total of shares repurchased and cancelled to 30 June 2021 is
US$1.22 billion, of which US$523.1 million occurred in 2021.
A capital return of 12.0 Australian cents per share was paid on 22 October 2019 and was funded using the proceeds from the
IFCO divestment.
Ordinary shares are classified as contributed equity. No gain or loss is recognised in the consolidated statement of
comprehensive income on the purchase, sale, issue or cancellation of Brambles’ own equity instruments.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction from the
proceeds of issue.
Ordinary shares of Brambles Limited entitle the holder to participate in dividends and the proceeds on any winding up of the
Company in proportion to the number of shares held.
106
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 22. Share-Based Payments
The Remuneration Report sets out details relating to the Brambles share plans (pages 62 and 64), together with details of
performance share rights and MyShare matching conditional rights issued to the Executive Directors and other Key Management
Personnel (pages 63 to 64). Rights granted by Brambles do not result in an entitlement to participate in share issues of any other
corporation.
Set out below are summaries of rights granted under the plans.
A) Grants over Brambles Limited Shares
Balance
at 1 July
Granted
during
year
Exercised
Forfeited /
during
year
lapsed
during year
Balance
at 30 June
Grant date
Expiry date
2021
Performance share rights
Awards granted in prior periods
5,812,644
-
(1,819,001)
(154,587)
3,839,056
27 Aug 2020
27 Aug 2026
15 Oct 2020
15 Oct 2026
-
-
16,272
(16,272)
2,570,624
-
-
-
-
2,570,624
MyShare matching conditional rights
2019 Plan Year
31 Mar 2021
2020 Plan Year
31 Mar 2022
2021 Plan Year
31 Mar 2023
960,922
455,379
-
-
(914,901)
(46,021)
-
925,250
507,814
(30,620)
(109,438)
1,240,571
(3,142)
(11,977)
492,695
Total rights
7,228,945
4,019,960
(2,783,936)
(322,023)
8,142,946
2020 (summarised comparative)
Total rights
6,629,011
3,912,987
(2,050,439)
(1,262,614)
7,228,945
Of the above grants, 289,736 were exercisable at 30 June 2021.
Weighted average data:
- fair value at grant date of grants made during the year
- share price at exercise date of grants exercised during the year
- remaining contractual life at 30 June
2021
2020
A$
A$
years
9.48
10.64
3.7
10.26
11.37
3.8
The cost of equity-settled share rights is recognised, together with a corresponding increase in equity, over the period in which
the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award
(vesting date).
107
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 22. Share-Based Payments – continued
A) Grants Over Brambles Limited Shares – continued
Executives and employees in certain jurisdictions are provided cash incentives calculated by reference to the awards under the
share-based compensation schemes (phantom shares). These phantom shares are fair valued on initial grant date and at each
subsequent reporting date.
The cost of cash-settled share rights is charged to the consolidated statement of comprehensive income over the relevant
vesting periods, with a corresponding increase in provisions.
B) Fair Value Calculations
The fair value of share rights subject to a market condition is determined at grant date using a Monte Carlo Simulation. The fair
value of share rights subject to a non-market condition is determined at grant date using a risk-neutral assumption. The values
calculated do not take into account the probability of rights being forfeited prior to vesting, as Brambles revises its estimate of
the number of share rights expected to vest at each reporting date.
The significant inputs into the valuation models for the grants made during the year were:
Weighted average share price
Expected volatility
Expected life
Annual risk-free interest rate
Expected dividend yield
2021
A$10.74
24%
2020
A$11.59
20%
2 – 3 years
2 – 3 years
0.14%
2.50%
0.68%
3.00%
The expected volatility was determined based on a three-year historic volatility of Brambles’ share prices.
C) Share-Based Payments Expense
Brambles recognised a total expense of US$24.9 million (2020: US$18.4 million) relating to equity-settled share-based payments
and US$1.9 million (2020: US$1.7 million) relating to cash-settled share-based payments. Of the equity-settled amount,
US$0.1 million (2020: US$0.2 million) related to discontinued operations.
108
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 23. Reserves and Retained Earnings
A) Movements in Reserves and Retained Earnings
Reserves
Share-
based
Foreign
currency
payments
translation
Unification
US$m
US$m
US$m
Other
US$m
Total
US$m
Retained
earnings
US$m
Year ended 30 June 2020
Opening balance
64.3
(386.2)
(7,162.4)
161.8
(7,322.5)
4,821.5
Actuarial loss on defined benefit plans
Foreign exchange differences
-
-
-
(143.9)
Share-based payments:
- expense recognised
- shares issued
- equity component of related tax
Dividends declared
Profit for the year
18.4
(14.5)
(1.8)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(143.9)
18.4
(14.5)
(1.8)
-
-
(4.1)
-
-
-
-
(471.9)
448.0
Closing balance as at 30 June 2020
66.4
(530.1)
(7,162.4)
161.8
(7,464.3)
4,793.5
Year ended 30 June 2021
Opening balance
Actuarial gain on defined benefit plans
Foreign exchange differences1
FCTR released to profit on divestment of Kegstar
Share-based payments:
- expense recognised
- shares issued
- equity component of related tax
- transfer to retained earnings on divestment of
Kegstar
Dividends declared
Profit for the year
66.4
(530.1)
(7,162.4)
161.8
(7,464.3)
4,793.5
-
-
-
-
180.9
3.3
24.9
(20.7)
1.4
(0.3)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
180.9
3.3
24.9
(20.7)
1.4
(0.3)
6.6
-
-
-
-
-
-
-
-
(287.0)
526.1
Closing balance as at 30 June 2021
71.7
(345.9)
(7,162.4)
161.8
(7,274.8)
5,039.2
1
Exchange differences on translation of foreign subsidiaries have been significantly impacted by the appreciation of the
Australian dollar, British Pound and Euro net assets translated into US dollars. The 2021 spot rate relative to the US dollar
strengthened by 9.5% for the Australian dollar, 12.5% for the British Pound and 5.9% for the Euro.
109
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 23. Reserves and Retained Earnings – continued
B) Nature and Purpose of Reserves
Share-based payments reserve
This comprises the cumulative share-based payment expense recognised in the statement of comprehensive income in relation
to equity-settled options and share rights issued but not yet exercised. Refer to Note 22 for further details.
Foreign currency translation reserve
This comprises cumulative exchange differences arising from the translation of the financial statements of foreign subsidiaries
and associates, net of qualifying net investment hedges. The relevant accumulated balance is recognised in the consolidated
statement of comprehensive income on disposal of a foreign subsidiary or associate.
Unification reserve
On Unification, Brambles Limited issued shares on a one-for-one basis to those Brambles Industries Limited (BIL) and Brambles
Industries plc (BIP) shareholders who did not elect to participate in the Cash Alternative. The Unification reserve of
US$15,385.8 million was established on 4 December 2006, representing the difference between the Brambles Limited share
capital measured at fair value and the carrying value of the share capital of BIL and BIP at that date. In the consolidated financial
statements, the reduction in share capital of US$8,223.4 million on 9 September 2011 by Brambles Limited in accordance with
section 258F of the Corporations Act 2001 was applied against the Unification reserve.
Other
This comprises a merger reserve created in 2001 and the hedging reserve. The hedging reserve represents the cumulative
portion of the gain or loss of cash flow hedges that are determined to be effective hedges. Amounts are recognised in the
statement of comprehensive income when the associated hedged transaction is recognised or the hedge or the forecast hedged
transaction is no longer highly probable.
110
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 24. Financial Risk Management
Brambles is exposed to a variety of financial risks: market risk (including the effect of fluctuations in interest rates and exchange
rates), liquidity risk and credit risk.
Brambles’ overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise
potential adverse effects on the financial performance of Brambles. Financial risk management activities are carried out centrally
by Brambles’ treasury function in accordance with Board policies and guidelines, through standard operating procedures and
delegated authorities.
Brambles uses interest rate swaps and forward foreign exchange contracts to manage its market risk and does not trade in
financial instruments for speculative purposes.
A) Financial Assets and Liabilities
Financial assets are recognised when Brambles becomes a party to the contractual provisions of the instrument and are classified
in the following two categories: financial assets at fair value through profit or loss; and amortised cost, as disclosed in the
respective notes.
Derecognition occurs when rights to the asset have expired or when Brambles transfers its rights to receive cash flows from the
asset together with substantially all the risks and rewards of the asset.
Refer to Note 19 for the recognition of interest bearing financial liabilities.
The fair values of all financial assets and liabilities held on the balance sheet as at 30 June 2021 equal the carrying amount, with
the exception of loan notes, which have an estimated fair value of US$1,826.4 million (2020: US$1,708.9 million) compared to a
carrying value of US$1,701.9 million (2020: US$1,636.7 million). Financial assets and liabilities held at fair value (other than loan
notes) are estimated using Level 2 estimation techniques, which use inputs that are observable for the asset or liability, either
directly (as prices) or indirectly (derived from prices). The fair value of loan notes has been calculated using Level 1 valuation
techniques, which use directly observable unadjusted quoted prices in active markets for identical assets or liabilities.
The fair value of forward exchange contracts is calculated by reference to current forward exchange rates for contracts with
similar maturities at the balance sheet date. The fair value of interest rate swap contracts is calculated as the present value of the
forward cash flows of the instrument after applying market rates and standard valuation techniques.
B) Derivative and Hedging Activities
For the purposes of hedge accounting, hedges are classified as either fair value hedges, cash flow hedges or net investment
hedges.
For fair value hedges, any gain or loss from remeasuring the hedging instrument at fair value is adjusted against the carrying
amount of the hedged item and recognised in profit or loss.
For cash flow hedges, the portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is
recognised in other comprehensive income and the ineffective portion is recognised in profit or loss.
Hedges for net investments in foreign operations are accounted for similarly to cash flow hedges.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated or exercised, or no longer qualifies
for hedge accounting.
111
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 24. Financial Risk Management – continued
C) Market Risk
Brambles has the following risk policies in place with respect to market risk.
Interest rate risk
Brambles’ exposure to potential volatility in finance costs is predominantly in Euros and US dollars on borrowings. This is
managed by maintaining a mix of fixed and floating-rate instruments within select target bands over defined periods. In some
cases, interest rate derivatives are used to achieve these targets synthetically. As at 30 June 2021, Brambles also has exposure to
variability in finance revenue through its holdings of cash and term deposits in Australian dollars.
The following table sets out the financial instruments exposed to interest rate risk at reporting date:
Financial assets (floating rate)
Cash at bank
Short-term deposits
Weighted average effective interest rate at 30 June
Financial assets (fixed rate)
Short-term deposits
Term deposit
Other receivables
Weighted average effective interest rate at 30 June1
Financial liabilities (floating rate)
Bank overdrafts
Bank loans
Interest rate swaps (notional value) – fair value hedges
Net exposure to cash flow interest rate risk
Weighted average effective interest rate at 30 June
Financial liabilities (fixed rate)
Loan notes
Bank loans
Lease liabilities
Interest rate swaps (notional value) – fair value hedges
Net exposure to fair value interest rate risk
Weighted average effective interest rate at 30 June
Note
2
11
2021
US$m
378.4
30.1
408.5
0.0%
-
-
23.6
23.6
5.7%
1.5
33.7
178.5
213.7
1.4%
2020
US$m
204.7
463.9
668.6
0.6%
68.7
68.6
23.3
160.6
1.5%
-
161.6
168.6
330.2
1.1%
1,701.9
1,636.7
13.4
712.6
(178.5)
2,249.4
2.9%
15.2
704.2
(168.6)
2,187.5
3.0%
1 2020 is primarily weighted to short-term deposits and term deposits at an average fixed rate of 0.8%. Other receivables have
a higher fixed interest rate than term deposits. 2021 only relates to other fixed rate receivables.
112
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 24. Financial Risk Management – continued
C) Market Risk – continued
Interest rate swaps – fair value hedges
Brambles entered into interest rate swap transactions with various banks, swapping €150.0 million of the €500.0 million 2024
Euro medium-term fixed-rate notes (EMTN) to variable rates. The interest rate swaps and debt have been designated in a
hedging relationship at a hedge ratio of 1:1. The fair value of the interest rate swaps are adjusted for credit risk, measured by
reference to credit default swaps for the interest rate swap counterparties, which is a source of ineffectiveness. Movement in
credit risk does not dominate the hedge relationship. The credit valuation adjustment to the swaps at 30 June 2021 is nil
(2020: US$0.1 million).
In accordance with AASB 9, the carrying value of the loan notes has been adjusted to increase debt by US$10.4 million
(2020: US$12.9 million) in relation to changes in fair value attributable to the hedged risk. The fair value of interest rate swaps at
reporting date was US$10.6 million (2020: US$12.6 million).
The terms of the swaps match the terms of the fixed-rate bond issue for the amounts and durations being hedged.
Fair value hedge
Description
Nominal amount (US$m)
Carrying amount (US$m)
Change in fair value (US$m)
Hedge ineffectiveness (US$m)
Balance sheet account impacted
Hedged item
Hedging instrument
€150m of the €500m EMTN
€150m interest rate swaps
178.5
181.0
10.4
Nil
178.5
10.4
10.6
0.2
Non-current borrowings
Other assets
Statement of comprehensive income account impacted
Finance revenue/finance costs
The gain or loss from remeasuring the interest rate swaps at fair value is recorded in profit or loss together with any changes in
the fair value of the hedged asset or liability that is attributed to the hedged risk. For 2021, all interest rate swaps were effective
hedging instruments.
Sensitivity analysis
Based on the Australian dollar floating rate financial assets and floating rate financial liabilities outstanding at 30 June 2021, if
Australian interest rates were to increase or decrease by 50 basis points with all other variables held constant, profit after tax for
the year would have been US$0.7 million higher/lower (2020: US$2.2 million higher/lower).
Foreign exchange risk
Exposure to foreign exchange risk generally arises in either the value of transactions translated back to the functional currency of
a subsidiary or associate, or the value of assets and liabilities of foreign currency subsidiaries or associates when translated back
to the Group’s reporting currency.
Foreign exchange hedging is used when a transaction exposure exceeds certain thresholds and as soon as a defined exposure
arises. Within Brambles, exposures may arise with external parties or, alternatively, by way of cross-border intercompany
transactions. Forward foreign exchange contracts are primarily used to manage exposures from normal commercial transactions
such as the purchase and sale of equipment and services, intercompany interest and royalties. Given that Brambles both
generates income and incurs expenses in its local currencies of operation, these exposures are not significant.
Brambles generally mitigates translation exposures by raising debt in currencies where there are matching assets.
113
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 24. Financial Risk Management – continued
C) Market Risk – continued
Foreign exchange risk – continued
Currency profile
The following table sets out the currency mix profile of Brambles’ financial instruments at reporting date. Financial assets
include cash, term deposits, trade receivables and derivative assets. Financial liabilities include trade payables, lease liabilities,
borrowings and derivative liabilities:
2021
Financial assets
Financial liabilities
2020
Financial assets
Financial liabilities
US
dollar
US$m
332.3
1,099.5
301.8
1,234.9
Aust.
dollar
US$m
222.2
156.7
643.8
105.8
British Pound
US$m
Euro
US$m
Other
US$m
Total
US$m
47.9
83.4
14.5
76.4
149.9
1,332.6
314.5
308.4
1,066.8
2,980.6
155.3
1,280.2
266.5
263.1
1,381.9
2,960.4
Forward foreign exchange contracts – cash flow hedges
During 2021, Brambles entered into forward foreign exchange transactions with various banks in a variety of cross-currencies
for terms ranging up to 18 months.
For 2021 and 2020, all foreign exchange contracts were effective hedging instruments. The fair value of these contracts at
reporting date was nil (2020: nil).
Other forward foreign exchange contracts
Brambles enters into other forward foreign exchange contracts for the purpose of hedging various cross-border
intercompany loans to overseas subsidiaries. In this case, the forward foreign exchange contracts provide an economic hedge
against exchange fluctuations on foreign currency loan balances. The face value and terms of the foreign exchange contracts
match the intercompany loan balances. Gains and losses on realignment of the intercompany loans and foreign exchange
contracts to spot rates are offset in the consolidated statement of comprehensive income. Consequently, these foreign
exchange contracts are not designated for hedge accounting purposes and are classified as held for trading. The fair value of
these contracts at reporting date was a net liability of US$6.1 million (2020: net asset of US$4.9 million).
Hedge of net investment in foreign entity
At 30 June 2021, €350.5 million (US$417.1 million) of the 2024 EMTN has been designated as a hedge of the net investment
in Brambles’ European subsidiaries and is being used to partially hedge Brambles’ exposure to foreign exchange risks on
these investments. For 2021 and 2020, there was no ineffectiveness to be recorded from such partial hedges of net
investments in foreign entities.
Sensitivity analysis
Based on the financial instruments held at 30 June 2021, if exchange rates were to weaken/strengthen against the US dollar
by 10% with all other variables held constant, the transaction exposure within profit after tax for the year would have been
US$0.6 million lower/higher. The impact on equity would have been US$29.3 million lower/higher (2020: US$27.8 million
lower/higher) as a result of the incremental movement through the foreign currency translation reserve relating to the
effective portion of a net investment hedge.
114
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 24. Financial Risk Management – continued
D) Liquidity Risk
Brambles’ objective is to maintain adequate liquidity to meet its financial obligations as and when they fall due. Brambles
funds its operations through existing equity, retained cash flow and borrowings. Funding is generally sourced from
relationship banks and debt capital market investors on a medium- to long-term basis.
Bank credit facilities are generally structured on a committed multi-currency revolving basis and at 30 June 2021 had
maturities ranging out to January 2026. Borrowings under the bank credit facilities are floating-rate, unsecured obligations
with covenants and undertakings typical for these types of arrangements.
Borrowings are raised from debt capital markets by the issue of unsecured fixed-interest notes, with interest payable
semi-annually or annually. At 30 June 2021, loan notes had maturities out to October 2027.
Brambles also has access to further funding through overdrafts, uncommitted and standby lines of credit, principally to
manage day-to-day liquidity.
The average term to maturity of the committed borrowing facilities and the loan notes is equivalent to 3.7 years
(2020: 4.2 years). These facilities are unsecured and are guaranteed as described in Note 33B.
Borrowing facilities maturity profile
2021
Total facilities
Facilities used1
Facilities available
2020
Total facilities
Facilities used1
Facilities available
1
Year 1
US$m
Year 2
US$m
Year 3
US$m
Year 4
US$m
>4 years
US$m
Total
US$m
298.7
(23.5)
275.2
376.9
(27.8)
349.1
535.8
912.8
212.2
1,455.4
3,414.9
(9.6)
(596.2)
(21.0)
(1,098.4)
(1,748.7)
526.2
316.6
191.2
357.0
1,666.2
471.3
(1.5)
469.8
404.4
663.3
1,500.6
3,416.5
-
(562.1)
(1,216.5)
(1,807.9)
404.4
101.2
284.1
1,608.6
Facilities used represent the principal value of loan notes and borrowings of US$1,739.9 million and letters of credit of
US$8.8 million drawn against the relevant facilities to reflect the correct amount of funding headroom. The loan note and
borrowings amount differs by US$10.6 million (2020: US$11.2 million) from loan notes and borrowings as shown in the
balance sheet, which are measured on the basis of amortised cost as determined under the effective interest method and
include accrued interest, transaction costs and fair value adjustments on certain hedging instruments.
115
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 24. Financial Risk Management – continued
D) Liquidity Risk – continued
Maturities of financial liabilities
The maturities of Brambles’ contractual cash flows on non-derivative financial liabilities (for principal and interest) and
contractual cash flows on net and gross settled derivative financial instruments, based on the remaining period to contractual
maturity date, are presented below. Cash flows on interest rate swaps and forward foreign exchange contracts are valued
based on forward interest and exchange rates applicable at reporting date.
Year 1
US$m
Year 2
US$m
Year 3
US$m
Year 4
US$m
>4 years
US$m
Total
contractual
cash
flows
US$m
Carrying
amount
(assets)/
liabilities
US$m
2021
Non-derivative financial liabilities
Trade payables
510.5
Bank overdrafts
Bank loans
Loan notes
Lease liabilities
Financial guarantees2
1.5
23.1
40.0
169.5
744.6
29.9
774.5
Derivative financial (assets)/liabilities
Net settled interest rate swaps
-
-
10.4
40.0
145.7
196.1
-
-
-
1.7
635.1
130.4
767.2
-
-
-
12.7
28.1
110.1
150.9
-
-
-
3.5
510.5
510.5
1.5
51.4
1.5
47.1
1,118.8
1,862.0
1,701.9
258.7
814.4
712.6
1,381.0
3,239.8
2,973.6
-
29.9
-
196.1
767.2
150.9
1,381.0
3,269.7
2,973.6
- fair value hedges
(3.4)
(3.7)
(3.4)
Gross settled forward foreign exchange contracts
- (inflow)
- outflow
(1,135.3)
1,141.4
-
-
-
-
2.7
(3.7)
(3.4)
-
-
-
-
-
-
-
-
(10.5)
(10.4)
(1,135.3)
1,141.4
(4.4)
-
6.1
(4.3)
116
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 24. Financial Risk Management – continued
D) Liquidity Risk – continued
Year 1
US$m
Year 2
US$m
Year 3
US$m
Year 4
US$m
>4 years
US$m
Total
contractual
cash
flows
US$m
Carrying
amount
(assets)/
liabilities
US$m
2020
Non-derivative financial liabilities
Trade payables
Bank loans
Loan notes
Lease liabilities
Financial guarantees2
438.4
30.1
42.4
135.0
645.9
27.4
673.3
Derivative financial (assets)/liabilities
Net settled interest rate swaps
-
3.5
42.4
118.5
164.4
-
-
1.9
42.4
107.5
151.8
-
-
1.9
604.5
98.0
704.4
-
-
151.1
438.4
188.5
438.4
176.8
1,126.8
1,858.5
1,636.7
365.4
824.4
704.2
1,643.3
3,309.8
2,956.1
-
27.4
-
164.4
151.8
704.4
1,643.3
3,337.2
2,956.1
- fair value hedges
(2.9)
(3.5)
(3.3)
(3.1)
Gross settled forward foreign exchange contracts
- (inflow)
- outflow
2
(462.3)
457.4
(7.8)
-
-
(3.5)
-
-
(3.3)
-
-
(3.1)
-
-
-
-
(12.8)
(12.6)
(462.3)
457.4
(17.7)
(4.9)
-
(17.5)
Refer to Note 27 a) for details on financial guarantees. The amounts disclosed above are the maximum amounts allocated
to the earliest period in which the guarantee could be called. Brambles does not expect these payments to eventuate.
117
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 24. Financial Risk Management – continued
E) Credit Risk Exposure
Brambles is exposed to credit risk on its financial assets, which comprise cash and cash equivalents, term deposits, trade and
other receivables and derivative financial instruments. The exposure to credit risks arises from the potential failure of
counterparties to meet their obligations. The maximum exposure to credit risk at the reporting date is the carrying amount of
the financial instruments, including the mark-to-market of hedging instruments where they represent an asset in the balance
sheet. Brambles has short-term deposits available at-call totalling US$30.1 million which are deposited with banks rated AA-
by Standard & Poor's. Other than the term deposits and non-current receivables due from First Reserve totalling
US$14.4 million (refer Note 11), there is no concentration of credit risk.
Brambles trades only with recognised, creditworthy third parties. Collateral is generally not obtained from customers.
Customers are subject to credit verification procedures including an assessment of their independent credit rating, financial
position, past experience and industry reputation. Credit limits are set for individual customers and approved by credit
managers in accordance with an approved authority matrix. These credit limits are regularly monitored and revised based on
historic turnover activity and credit performance. In addition, overdue receivable balances are monitored and actioned on a
regular basis.
Brambles transacts derivatives with prominent financial institutions and has credit limits in place to limit exposure to any
potential non-performance by its counterparties.
F) Capital Risk Management
Brambles’ objective when managing capital is to ensure Brambles continues as a going concern as well as to provide a
balance between financial flexibility and balance sheet efficiency. In determining its capital structure, Brambles considers the
robustness of future cash flows, potential funding requirements for growth opportunities and acquisitions, the cost of capital
and ease of access to funding sources.
Brambles manages its capital structure to be consistent with a solid investment-grade credit rating. At 30 June 2021,
Brambles held investment-grade credit ratings of BBB+ from Standard & Poor’s and Baa1 from Moody’s Investors Service.
Initiatives available to Brambles to achieve its desired capital structure include adjusting the amount of dividends paid to
shareholders, returning capital to shareholders, buying-back share capital, issuing new shares, selling assets to reduce debt,
varying the maturity profile of its borrowings and managing discretionary expenses.
Brambles considers its capital to comprise:
Total borrowings
Total lease liabilities
Less: cash and cash equivalents
Less: term deposits
Net debt
Total equity
Total capital
2021
US$m
2020
US$m
1,750.5
1,813.5
712.6
(408.5)
-
2,054.6
2,689.2
4,743.8
704.2
(737.3)
(68.6)
1,711.8
2,756.4
4,468.2
Under the terms of its major borrowing facilities, Brambles is required to comply with the following financial covenants:
-
-
the ratio of net debt (excluding term deposits) to EBITDA is to be no more than 3.5 to 1; and
the ratio of EBITDA to net finance costs is to be no less than 3.5 to 1.
Loan covenant ratios are calculated including the impact of AASB 16 Leases and on a 12-month rolling basis. EBITDA for the
purpose of loan covenant calculations is Underlying Profit before interest, tax, IPEP, depreciation and amortisation for
continuing and discontinued operations.
Brambles has complied with these financial covenants for 2021 and prior years.
118
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 25. Cash Flow Statement – Additional Information
A) Reconciliation of Cash
For the purpose of the consolidated cash flow statement, cash comprises:
Cash at bank and in hand
Short-term deposits1
Cash and cash equivalents
Bank overdraft (Note 19)
2021
US$m
378.4
30.1
408.5
(1.5)
407.0
2020
US$m
204.7
532.6
737.3
-
737.3
1
Short-term deposits recognised within cash and cash equivalents have maturities of three months or less and are measured
at amortised cost.
Cash and cash equivalents include deposits with financial institutions and other highly liquid investments which are readily
convertible to cash on hand and are subject to an insignificant risk of changes in value. Bank overdrafts are presented within
borrowings in the balance sheet.
Cash and cash equivalents include balances of US$0.2 million (2020: US$0.2 million) used as security for various contingent
liabilities and are not readily accessible.
Brambles has various master netting and set-off arrangements covering cash pooling. No amounts have been reduced from
cash at bank and overdraft at 30 June 2021 (2020: US$2.3 million).
119
Consolidated Financial Report
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 25. Cash Flow Statement – Additional Information – continued
B) Reconciliation of Profit After Tax to Net Cash Flow from Operating Activities
Profit after tax
Adjustments for:
- depreciation and amortisation
- IPEP expense
- net loss on divestments
- net loss/(gain) on disposal of property, plant and equipment
- impairment of goodwill, intangibles and plant and equipment
- other valuation adjustments
- share of loss of associates
- equity-settled share-based payments
- net finance revenues and costs
Movements in operating assets and liabilities, net of acquisitions and disposals:
- (increase)/decrease in trade and other receivables
- increase in prepayments
- increase in inventories
- increase in deferred taxes
- increase in trade and other payables
- (decrease)/increase in tax payables
- increase in provisions
- other
2021
US$m
526.1
667.7
199.8
1.9
1.3
-
(3.6)
0.6
24.9
(0.3)
(78.9)
(9.3)
(10.3)
76.9
133.5
(6.2)
31.2
4.1
2020
US$m
448.0
612.2
155.7
-
(2.3)
28.0
(7.0)
-
18.4
(14.7)
43.9
(33.0)
(9.6)
15.1
107.3
9.3
12.8
2.8
Net cash inflow from operating activities
1,559.4
1,386.9
120
Consolidated Financial Report
Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 25. Cash Flow Statement – Additional Information – continued
C) Reconciliation of Movement in Net Debt
Net debt at beginning of the year
Adjust for AASB 16 opening lease liabilities
Net cash inflow from operating activities
Net cash outflow from investing activities
Net payments from disposal of businesses, net of cash disposed
Acquisition of forestry assets
Payments for share buy-back
Return of capital to shareholders
Dividends paid - ordinary
Dividends paid - special
Net outflow/(inflow) from derivative financial instruments
Lease capitalisation, interest accruals and other
Foreign exchange differences
Net debt at end of the year
Being:
Current borrowings
Current lease liabilities
Non-current borrowings
Non-current lease liabilities
Cash and cash equivalents
Term deposits
Net debt at end of the year
2021
US$m
1,711.8
-
2020
US$m
97.7
741.6
(1,559.4)
(1,386.9)
937.4
9.5
15.5
523.1
-
280.8
-
5.3
106.5
24.1
924.7
16.0
-
645.4
129.3
290.7
183.2
(26.5)
77.1
19.5
2,054.6
1,711.8
32.4
147.5
36.3
112.8
1,718.1
1,777.2
565.1
(408.5)
-
591.4
(737.3)
(68.6)
2,054.6
1,711.8
D) Non-cash Financing or Investing Activities
Apart from the Kegstar divestment and the MyShare Dividend Reinvestment Plan, there were no financing or investing
transactions during the year which had a material effect on the assets and liabilities of Brambles that did not involve cash flows.
Note 26. Capital Expenditure Commitments
Capital Expenditure Commitments
Capital expenditure, principally relating to property, plant and equipment, contracted for but not recognised as liabilities at
reporting date was as follows:
Within one year
Between one and five years
2021
US$m
184.2
0.2
184.4
2020
US$m
74.0
-
74.0
121
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 27. Contingencies
a)
Subsidiaries have contingent unsecured liabilities in respect of guarantees given relating to leases, workers compensation
insurance and other obligations totalling US$29.8 million (2020: US$27.4 million), of which US$19.9 million
(2020: US$21.1 million) is also guaranteed by Brambles Limited and US$8.8 million (2020: US$5.6 million) is also guaranteed
by Brambles Limited and certain of its subsidiaries under a deed of cross-guarantee and is included in Note 33B.
b)
Environmental contingent liabilities
Brambles’ activities have previously included the treatment and disposal of hazardous and non-hazardous waste through
subsidiaries and corporate joint ventures or associates. In addition, other activities of Brambles entail using, handling and
storing materials which are capable of causing environmental impairment.
As a consequence of the nature of these activities, Brambles has incurred and may continue to incur environmental costs and
liabilities associated with site and facility operation, closure, remediation, aftercare, monitoring and licensing. Provisions have
been made in respect of estimated environmental liabilities at all sites and facilities where obligations are known to exist and
can be reliably measured.
However, additional liabilities may emerge due to a number of factors including changes in the numerous laws and
regulations which govern environmental protection, liability, land use, planning, climate change and other matters in each
jurisdiction in which Brambles operates or has operated. These extensive laws and regulations are continually evolving in
response to technological advances, scientific developments, climate change and other factors. Brambles cannot predict the
extent to which it may be affected in the future by any such changes in legislation or regulation.
c)
Brambles continues to defend a consolidated class action raised on behalf of certain shareholders who acquired shares
during the period between 18 August 2016 and 20 February 2017. Brambles has filed its defence in the consolidated action.
It is not possible to determine the ultimate impact, if any, of the action upon Brambles, and it continues to vigorously defend
the proceedings.
In the ordinary course of business, Brambles becomes involved in litigation. Provisions have been made for known
obligations where the existence of the liability is probable and can be reasonably quantified. Receivables have been
recognised where recoveries, for example from insurance arrangements, are virtually certain.
As the outcomes of these matters remain uncertain, contingent liabilities exist for any potential amounts payable.
122
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 28. Auditor’s Remuneration
Audit and review services:
- PwC Australia
- Other PwC network firms
Total audit and review services
Other assurance services (which could be performed by other firms):
- PwC Australia
- Other PwC network firms
Total other assurance services
2021
US$’000
2020
US$’000
2,078
3,004
5,082
-
5
5
1,987
2,528
4,515
83
9
92
Total remuneration for audit, review and other assurance services
5,087
4,607
Other services:
- Tax advisory services - other PwC network firms
- Other - PwC Australia
- Other - other PwC network firms
Total other services1
Total auditor’s remuneration
1
4
-
39
43
4
11
6
21
5,130
4,628
Other services during 2021 and 2020 primarily related to compliance projects and tax consulting advice.
From time to time, Brambles employs PwC on assignments additional to its statutory audit duties where PwC, through its detailed
knowledge of the Group, is best placed to perform the services from an efficiency, effectiveness and cost perspective. The
performance of such non-audit related services is always balanced with the fundamental objective of ensuring PwC’s objectivity
and independence as auditors. To ensure this balance, Brambles’ Charter of Audit Independence outlines the services that can be
undertaken by the auditors and requires that the Audit Committee approves any management recommendation that PwC
undertakes non-audit work (with approval being delegated to the Chief Financial Officer within specified monetary limits).
123
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 29. Key Management Personnel
A) Key Management Personnel Compensation
Short-term employee benefits
Post-employment benefits
Other benefits
Share-based payment expense
2021
US$’000
6,122
103
43
4,719
10,987
2020
US$’000
5,203
86
32
2,839
8,160
The composition of reportable Key Management Personnel in 2021 is different to 2020. Refer to the Remuneration Report for
further information.
B) Other Transactions with Key Management Personnel
Other transactions with Key Management Personnel are set out in Note 30A.
Further remuneration disclosures are set out in the Directors’ Report on pages 45 to 64 of the Annual Report.
Note 30. Related Party Information
A) Other Transactions
Other transactions entered into during the year with Directors of Brambles Limited, with Director-related entities, with
Key Management Personnel (KMP, as set out in the Directors’ Report), or with KMP-related entities, were on terms and conditions
no more favourable than those available to other employees, customers or suppliers and include transactions in respect of the
employee option plans, contracts of employment, service agreements with Non-Executive Directors and reimbursement of
expenses. Any other transactions were trivial in nature.
B) Other Related Parties
A subsidiary has a non-interest bearing advance outstanding as at 30 June 2021 of US$1,072,084 (2020 US$979,164) to Brambles
Custodians Pty Limited, the trustee under Brambles' employee loan scheme. This scheme enabled employees to acquire shares in
Brambles Industries Limited (BIL) and has been closed to new entrants since August 2002.
124
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 30. Related Party Information – continued
C) Material Subsidiaries
The principal subsidiaries of Brambles during the year were:
Name
CHEP USA
CHEP Canada Corp
CHEP UK Limited
CHEP Equipment Pooling NV
CHEP España SA
CHEP Deutschland GmbH
Place of incorporation
USA
Canada
UK
Belgium
Spain
Germany
CHEP South Africa (Proprietary) Limited
South Africa
CHEP Australia Limited
CHEP Mexico SRL
Brambles USA Inc.
Brambles Industries Limited
Brambles Finance plc
Brambles Finance Limited
Australia
Mexico
USA
Australia
UK
Australia
% interest held at
reporting date
2021
100
100
100
100
100
100
100
100
100
100
100
100
100
2020
100
100
100
100
100
100
100
100
100
100
100
100
100
In addition to the list above, there are a number of other non-material subsidiaries within Brambles.
Investments in subsidiaries are primarily by means of ordinary or common shares. Shares in subsidiaries are recorded at cost, less
provision for impairment.
Material subsidiaries which prepare statutory financial statements report a 30 June balance sheet date, with the exception of CHEP
Mexico SRL, which reports a 31 December balance sheet date.
Note 31. Events After Balance Sheet Date
Other than those outlined in the Directors’ Report or elsewhere in these financial statements, no other events have occurred
subsequent to 30 June 2021 and up to the date of this report that have had a material impact on Brambles’ financial performance
or position.
125
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 32. Net Assets Per Share
Based on 1,441.2 million shares (2020: 1,505.0 million shares):
- Net tangible assets per share
- Net assets per share
2021
2020
US cents
US cents
167.0
186.6
165.9
183.1
Net tangible assets per share is calculated by dividing total equity attributable to the members of the parent entity, less
goodwill and intangible assets, by the number of shares on issue at year end.
Net assets per share is calculated by dividing total equity attributable to the members of the parent entity by the number of
shares on issue at year end.
Parent entity
2021
US$m
(23.4)
499.1
475.7
4.0
5,100.2
5,104.2
48.7
22.0
70.7
2020
US$m
(18.0)
(167.7)
(185.7)
1.6
5,338.1
5,339.7
6.0
-
6.0
5,033.5
5,333.7
4,924.8
5,427.2
67.9
(453.8)
494.6
54.4
(952.9)
805.0
5,033.5
5,333.7
Note 33. Parent Entity Financial Information
A) Summarised Financial Data of Brambles Limited
Loss for the year
Other comprehensive income/(expense) for the year1
Total comprehensive income/(expense)
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Contributed equity
Share-based payment reserve
Foreign currency translation reserve
Retained earnings
Total equity
1
Comprises foreign currency translation movements.
126
Consolidated Financial Report Notes to and Forming Part of the Financial Statements – continued
for the year ended 30 June 2021
Note 33. Parent Entity Financial Information – continued
A) Summarised Financial Data of Brambles Limited – continued
The financial information for the parent entity has been prepared on the same basis as the consolidated financial statements
except for investments and receivables from subsidiaries. In the parent entity financial information, investments in subsidiaries
are accounted for at cost and receivables from subsidiaries are held at amortised cost. Where appropriate, receivables from
subsidiaries have been adjusted for expected credit losses. Dividends received from investments in subsidiaries are recognised
as revenue.
B) Guarantees and Contingent Liabilities
Brambles Limited and certain of its subsidiaries are parties to a deed of cross-guarantee which supports global financing credit
facilities available to certain subsidiaries. Total facilities available amount to US$1,399.9 million (2020: US$1,500.2 million), of
which US$8.8 million (2020: US$140.6 million) has been drawn.
Brambles Limited and certain of its subsidiaries are parties to a guarantee which supports loan notes of US$500.0 million
(2020: US$500.0 million) issued by a subsidiary to qualified institutional buyers in accordance with Rule 144A and Regulation S
of the United States Securities Act.
Brambles Limited and certain of its subsidiaries are parties to a guarantee which supports loan notes of €1,000.0 million
(2020: €1,000.0 million) issued by two subsidiaries in the European bond market.
Brambles Limited has guaranteed repayment of certain facilities and financial accommodations made available to certain
subsidiaries. Total facilities and financial accommodations available amount to US$512.2 million (2020: US$449.6 million), of
which US$69.7 million (2020: US$64.9 million) has been drawn.
Brambles Limited was served with class action proceedings in 2018 which has been disclosed as a contingent liability
(refer Note 27c).
C) Contractual Commitments
Brambles Limited did not have any contractual commitments for the acquisition of property, plant and equipment at
30 June 2021 or 30 June 2020.
127
Consolidated Financial Report Directors’ Declaration
In the opinion of the Directors of Brambles Limited:
(a)
the financial statements and notes set out on pages 73 to 127 are in accordance with the Corporations Act 2001,
including:
(i)
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements; and
(ii)
giving a true and fair view of the consolidated financial position of Brambles Limited as at 30 June 2021 and of its
performance for the year ended on that date;
(b)
there are reasonable grounds to believe that Brambles Limited will be able to pay its debts as and when they become
due and payable.
A statement of compliance with International Financial Reporting Standards as issued by the International Accounting
Standards Board is included within Note 1 to the financial statements.
The Directors have been given the declarations by the Chief Executive Officer and Chief Financial Officer required by section
295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the Directors.
J P Mullen
Chair
G A Chipchase
Chief Executive Officer
17 August 2021
128
Directors’ Declaration Independent Auditor’s Report
to the Members of Brambles Limited
Independent auditor’s report
To the members of Brambles Limited
Auditor’s Independence Declaration
Report on the audit of the financial report
As lead auditor for the audit of Brambles Limited for the year ended 30 June 2021, I declare that to the
best of my knowledge and belief, there have been:
Our opinion
In our opinion:
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
The accompanying financial report of Brambles Limited (the Company) and its controlled entities
(together the Group) is in accordance with the Corporations Act 2001, including:
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
(a) giving a true and fair view of the Group's financial position as at 30 June 2021 and of its
This declaration is in respect of Brambles Limited and the entities it controlled during the period.
financial performance for the year then ended
(b) complying with Australian Accounting Standards and the Corporations Regulations 2001.
What we have audited
The Group financial report comprises:
●
●
Susan Horlin
Partner
●
PricewaterhouseCoopers
●
●
the consolidated balance sheet as at 30 June 2021
the consolidated statement of comprehensive income for the year then ended
the consolidated statement of changes in equity for the year then ended
the consolidated cash flow statement for the year then ended
the notes to the consolidated financial statements, which include significant accounting policies
and other explanatory information
the directors’ declaration.
Sydney
17 August 2021
●
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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Independence
We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical
Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also
fulfilled our other ethical responsibilities in accordance with the Code.
PricewaterhouseCoopers, ABN 52 780 433 757
PricewaterhouseCoopers, ABN 52 780 433 757
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
Liability limited by a scheme approved under Professional Standards Legislation.
129
Independent Auditor’s Report
Independent Auditor’s Report - continued
to the Members of Brambles Limited
Our audit approach
An audit is designed to provide reasonable assurance about whether the financial report is free from
material misstatement. Misstatements may arise due to fraud or error. They are considered material if
Auditor’s Independence Declaration
individually or in aggregate, they could reasonably be expected to influence the economic decisions of
users taken on the basis of the financial report.
As lead auditor for the audit of Brambles Limited for the year ended 30 June 2021, I declare that to the
best of my knowledge and belief, there have been:
We tailored the scope of our audit to ensure that we performed enough work to be able to give an
opinion on the financial report as a whole, taking into account the geographic and management
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
structure of the Group, its accounting processes and controls and the industry in which it operates.
relation to the audit; and
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Brambles Limited and the entities it controlled during the period.
Susan Horlin
Materiality
Partner
PricewaterhouseCoopers
Sydney
17 August 2021
● For the purpose of our audit we used overall Group materiality of $39 million, which represents
approximately 5% of the Group’s profit before tax from continuing operations.
● We applied this threshold, together with qualitative considerations, to determine the scope of our audit and
the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements on the
financial report as a whole.
● We chose profit before tax from continuing operations because, in our view, it is the benchmark against
which the performance of the Group is most commonly measured, and it is a generally accepted benchmark.
● We utilised a 5% threshold based on our professional judgement, noting it is within the range of commonly
acceptable thresholds.
Audit Scope
● Our audit focused on where the Group made subjective judgements; for example, significant accounting
estimates involving assumptions and inherently uncertain future events.
● The Group’s financial results comprise the consolidation of a network of pooled pallet, crate and container
businesses which are geographically widespread. We tailored the scope of our audit so that we performed
sufficient work to be able to provide an opinion on the financial report as a whole, taking into account the
structure of the Group, the significance and risk profile of each business, the accounting processes and
controls, and the industry in which the Group operates.
Audit of locations, transactions and balances
● Separate PwC firms in the relevant locations (“local PwC audit firms”) performed an audit of the financial
information prepared for consolidation purposes for eleven components of the Group. The components
were selected due to their significance to the Group, either by individual size or by risk. Certain components
PricewaterhouseCoopers, ABN 52 780 433 757
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
130
Independent Auditor’s Report
Independent Auditor’s Report - continued
to the Members of Brambles Limited
in the Group are selected every year due to their size or nature, whilst others are included on a rotational
basis.
In addition, local PwC audit firms performed risk focused targeted audit or specified procedures on selected
●
transactions and balances for a further thirteen components.
Auditor’s Independence Declaration
● The remaining components were financially insignificant and comprise more than one hundred and fifty
entities. The PwC Australia Group audit team performs analytical and other specified procedures over these
As lead auditor for the audit of Brambles Limited for the year ended 30 June 2021, I declare that to the
entities.
best of my knowledge and belief, there have been:
Audit of shared services functions
relation to the audit; and
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
● Our procedures on IT, tax and certain finance processes were performed by local PwC audit firms based in
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
various territories, reflecting the location of the Group’s shared services functions. This included some audit
procedures performed at the Group’s finance process outsourced services provider. The PwC Australia
Group audit team (the Group audit team) performed audit procedures over centrally managed areas such as
the impairment assessment of goodwill, share based payments, retirement benefit obligations, treasury and
the consolidation process.
This declaration is in respect of Brambles Limited and the entities it controlled during the period.
Direction and supervision by the Group Audit team
● The audit procedures were performed by PwC Australia and local PwC audit firms operating under the
Group audit team’s instructions. The Group audit team determined the level of involvement needed in the
audit work of local PwC audit firms to be satisfied that sufficient audit evidence had been obtained for the
purpose of the opinion. The Group audit team kept in regular communication with the local PwC audit firms
throughout the year through phone calls, discussions and written instructions. With the limitations on
overseas travel, senior members of the Group audit team met virtually with management across a number
of territories and local PwC audit teams throughout the year, including the two largest locations.
Sydney
17 August 2021
● The audit team both at Group and at local component levels were appropriately skilled and competent to
perform an audit of a complex global business. This included specialists and experts in areas such as IT,
actuarial, tax and valuations.
Susan Horlin
Partner
PricewaterhouseCoopers
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the financial report for the current period. The key audit 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. Further, any commentary on the outcomes of a particular audit procedure is made in that context.
We communicated the key audit matters to the Audit and Risk Committee.
Key audit matter
How our audit addressed the key audit
matter
Accounting for pooling equipment assets
(Refer to Note 14)
We performed the following procedures:
● Evaluated the design effectiveness and tested a
selection of key asset management controls
including attending pallet audits and assessing
the results of the Group’s counts.
Brambles’ pooling equipment is accounted for as
depreciable fixed assets, classified within plant and
equipment. The accounting for pooling equipment
was a key audit matter due to the assets’ financial size
and judgement involved and is considered a
significant estimate. As disclosed in Note 14 of the
financial report, there is inherent risk in accounting
PricewaterhouseCoopers, ABN 52 780 433 757
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
131
Independent Auditor’s Report
Independent Auditor’s Report - continued
to the Members of Brambles Limited
for pooling equipment due to the high volume of asset
movements through a complex network, and a
limitation on the Group’s ability to physically verify
the quantity of the pallets, crates and containers due
Auditor’s Independence Declaration
to access and cost prohibitions. The largest category
of pooling equipment is pallets.
● Tested key reconciliations between the numbers
of pallets in the accounting records compared to
the operations system.
● To challenge the IPEP calculation methodology
and assumptions we:
o
relation to the audit; and
As lead auditor for the audit of Brambles Limited for the year ended 30 June 2021, I declare that to the
best of my knowledge and belief, there have been:
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
The key area of judgement in relation to pooled
pallets is the quantity of lost pallets. The
irrecoverable pooling equipment provision (IPEP) is
calculated by considering the results of the Group’s
pallet audits, historical experience of pallet loss, and
flows analysis as reported through the asset
management system.
assessed key assumptions and judgements
with a particular focus on distributors who
are not customers of CHEP, as losses from
such distributors are historically higher;
assessed provision estimates for
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
significant customers where CHEP has no
access to physically count the pallets;
This declaration is in respect of Brambles Limited and the entities it controlled during the period.
evaluated how historical pallet loss rates
and flows analysis are used to estimate
future losses; and
tested the calculations and extrapolations
of provision estimates across pallet
locations.
The determination of pallet losses is considered a
significant estimate due to the subjectivity involved in
estimated pallet loss rates based on historical
experience.
o
o
o
Susan Horlin
Partner
PricewaterhouseCoopers
Calculation of current and deferred taxation
balances
(Refer to Note 6)
The calculation of taxation balances was a key audit
matter because the Group operates in a large number
of jurisdictions with different laws, regulations and
authorities resulting in complex tax calculations.
Judgement is involved in a number of aspects of the
tax calculations, including the assessment of recorded
tax losses for recoverability and determination of
uncertain tax positions. The judgement relating to
the determination of the uncertain tax position is
considered a significant estimate due to the
complexity, subjectivity and inherent risk involved.
The calculation of income taxes is disclosed in Note 6
of the financial report including the key judgements
made in the assessment of the taxation provision.
● Evaluated the reasonableness of the disclosures
made in Note 14, including those related to
estimation uncertainty, against the
requirements of Australian Accounting
Standards.
Sydney
17 August 2021
We performed the following procedures:
● Assessed the rationale on which current tax was
calculated and deferred tax assets and liabilities
were recognised.
● Tested the Group tax analysis prepared by
management, with the assistance of PwC tax
specialists, who liaise directly with local PwC
tax experts and specialists in other territories
where required.
● For significant transactions undertaken during
the year, we assessed whether the supporting
tax analysis was in accordance with the tax
legislation in the relevant jurisdiction and the
related impact on the tax calculation.
● Challenged whether the Group had sufficient
taxable temporary differences to recognise tax
losses by considering when these temporary
differences will become taxable income
compared to the expiry of the losses. We also
PricewaterhouseCoopers, ABN 52 780 433 757
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
132
Independent Auditor’s Report
Independent Auditor’s Report - continued
to the Members of Brambles Limited
assessed the rationale for and calculation of
unrecognised deferred tax assets which are
disclosed.
Auditor’s Independence Declaration
● Considered and challenged the assumptions
As lead auditor for the audit of Brambles Limited for the year ended 30 June 2021, I declare that to the
best of my knowledge and belief, there have been:
made by the Group in making judgemental tax
provisions.
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
● Evaluated the reasonableness of the disclosures
made in Note 6, including those related to
estimation uncertainty, against the
requirements of Australian Accounting
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
Standards.
relation to the audit; and
This declaration is in respect of Brambles Limited and the entities it controlled during the period.
Other information
The directors are responsible for the other information. The other information comprises the
information included in the annual report for the year ended 30 June 2021, but does not include the
financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon.
Sydney
Susan Horlin
17 August 2021
Partner
In connection with our audit of the financial report, our responsibility is to read the other information
PricewaterhouseCoopers
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of
this auditor’s report, we conclude that there is a material misstatement of this other information, we
are required to report that fact. We have nothing to report in this regard.
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
PricewaterhouseCoopers, ABN 52 780 433 757
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
133
Independent Auditor’s Report
Independent Auditor’s Report - continued
to the Members of Brambles Limited
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
Auditor’s Independence Declaration
decisions of users taken on the basis of the financial report.
As lead auditor for the audit of Brambles Limited for the year ended 30 June 2021, I declare that to the
A further description of our responsibilities for the audit of the financial report is located at the
best of my knowledge and belief, there have been:
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
our auditor's report.
relation to the audit; and
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
Report on the remuneration report
This declaration is in respect of Brambles Limited and the entities it controlled during the period.
Our opinion on the remuneration report
We have audited the remuneration report included in pages 45 to 64 of the directors’ report for the
year ended 30 June 2021.
In our opinion, the remuneration report of Brambles Limited for the year ended 30 June 2021
complies with section 300A of the Corporations Act 2001.
Susan Horlin
Responsibilities
Partner
PricewaterhouseCoopers
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.
Sydney
17 August 2021
PricewaterhouseCoopers
Susan Horlin
Partner
Eliza Penny
Partner
Sydney
17 August 2021
Sydney
17 August 2021
PricewaterhouseCoopers, ABN 52 780 433 757
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
134
Independent Auditor’s Report
Auditor’s Independence Declaration
Auditor’s Independence Declaration
As lead auditor for the audit of Brambles Limited for the year ended 30 June 2021, I declare that to the
best of my knowledge and belief, there have been:
(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
(b) no contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Brambles Limited and the entities it controlled during the period.
Susan Horlin
Partner
PricewaterhouseCoopers
Sydney
17 August 2021
PricewaterhouseCoopers, ABN 52 780 433 757
One International Towers Sydney, Watermans Quay, Barangaroo, GPO BOX 2650, SYDNEY NSW 2001
T: +61 2 8266 0000, F: +61 2 8266 9999, www.pwc.com.au
Level 11, 1PSQ, 169 Macquarie Street, Parramatta NSW 2150, PO Box 1155 Parramatta NSW 2124
T: +61 2 9659 2476, F: +61 2 8266 9999, www.pwc.com.au
Liability limited by a scheme approved under Professional Standards Legislation.
135
Auditor’s Independence Declaration
Five-Year Financial Performance Summary
Weighted average number of shares (millions)
1,475.1
1,548.7
US$m
Continuing operations
Sales revenue – CHEP1
Sales revenue – IFCO2
Total sales revenue1,2
EBITDA1,2,3,4
Depreciation and amortisation1,2,3
IPEP expense1,2,4
Underlying Profit – CHEP1,3
Underlying Profit – IFCO2
Total Underlying Profit1,2,3
Significant Items1,2
Operating profit1,2,3
Net finance costs1,2,3
Profit before tax1,2,3
Tax expense1,2,3
Profit from continuing operations1,2,3
(Loss)/profit from discontinued operations1,2,3,5
Profit for the year1,2,3,5
Earnings per share (US cents)
Basic
From continuing operations1,2,3,5
On Underlying Profit after finance costs and tax1,2,3,5
ROCI1,2,3,5
Capex on property, plant and equipment1,2,5
Balance sheet
Capital employed
Net debt3
Equity
Average Capital Invested1,2,3,5
Cash flow
Cash Flow from Operations1,2,3,5
Free Cash Flow3
Ordinary dividends paid, net of Dividend Reinvestment Plan
Free Cash Flow after ordinary dividends
Net debt ratios
Net debt to EBITDA (times)1,2,3,4
EBITDA interest cover (times)1,2,3,4
Average employees
2021
2020
2019
2018
2017
5,209.8
4,717.9
4,595.3
4,470.3
4,133.5
-
5,209.8
1,742.6
(665.0)
(198.3)
879.3
-
-
4,717.9
1,561.8
(607.7)
(154.7)
799.4
-
879.3
799.4
-
879.3
(85.6)
793.7
-
799.4
(80.8)
718.6
(258.7)
(210.6)
535.0
(8.9)
526.1
508.0
(60.0)
448.0
35.7
36.3
37.8
18%
28.9
32.8
32.8
17%
-
4,595.3
1,415.1
(484.3)
(127.1)
803.7
-
803.7
(62.8)
740.9
(88.5)
652.4
(198.3)
454.1
1,013.6
1,467.7
1,593.4
92.1
28.5
31.9
19%
-
4,470.3
1,392.3
(464.3)
(101.9)
826.1
-
826.1
(47.4)
778.7
(103.4)
675.3
(121.8)
553.5
139.2
692.7
970.8
5,104.3
1,573.4
(526.7)
(89.2)
823.1
134.4
957.5
(186.1)
771.4
(98.7)
672.7
(227.8)
444.9
(262.0)
182.9
1,591.2
1,588.3
43.5
34.8
33.0
20%
11.5
28.0
38.5
17%
1,219.0
968.4
1,060.4
1,012.5
1,023.5
4,743.8
2,054.6
2,689.2
4,937.9
4,468.2
1,711.8
2,756.4
4,698.7
3,905.9
97.7
3,808.2
4,130.6
5,086.5
2,308.1
2,778.4
4,115.4
901.1
622.0
280.8
341.2
1.2
20.4
754.8
462.2
290.7
171.5
1.1
19.3
431.8
238.5
328.1
(89.6)
0.1
14.6
724.8
554.4
352.0
202.4
1.5
15.0
5,419.4
2,572.7
2,846.7
5,646.4
591.5
224.2
348.0
(123.8)
1.7
15.2
11,569
11,647
10,896
10,441
13,882
Dividend declared6 (cents per share)
20.5 US
18.0 US
29.0 AU
29.0 AU
29.0 AU
1 The Kegstar business is presented within discontinued operations in 2021 and 2020. Periods prior to 2020 include Kegstar within continuing operations and
are consistent with previously published data.
2 IFCO is presented within discontinued operations in 2019 and 2018. 2017 includes IFCO within continuing operations and is consistent with previously
published data.
3 Periods prior to 2020 have not been restated for the impact of new accounting standard AASB 16 Leases. Periods prior to 2018 have not been restated for the
impact of the new accounting standards AASB 9 Financial Instruments and AASB 15 Revenue from Contracts with Customers.
4 Effective from 2020, EBITDA has been redefined as Underlying Profit from continuing operations after adding back depreciation, amortisation and IPEP expense.
Prior periods have been restated to align with the revised definition. The net debt ratios for periods prior to 2020 have not been restated to align with the revised
EBITDA definition and are consistent with previously published data.
5 Discontinued operations include the Kegstar business in 2021 and 2020; CHEP Recycled business in 2018 to 2017; and Oil & Gas and Aerospace businesses in 2017.
6 Effective from 2020, Brambles changed to a payout ratio-based dividend policy, with the dividend per share declared in US cents and converted and paid in
Australian cents. Prior to 2020, dividends were declared and paid in Australian cents.
136
Five-Year Financial Performance Summary
Glossary
Acquired Shares
Brambles Limited shares purchased by Brambles' employees under MyShare
Actual currency/actual FX
Results translated into US dollars at the applicable actual monthly exchange rates
ruling in each period
AGM
Annual General Meeting
ACI (Average Capital Invested)
A 12-month average of capital invested; capital invested is calculated as net assets
before tax balances, cash, term deposits, borrowings and lease liabilities, but after
adjustment for pension plan actuarial gains or losses and net equity adjustments for
equity-settled share-based payments
AU cents
Australian cents
BIFR (Brambles Injury Frequency Rate) Safety performance indicator that measures the combined number of fatalities, lost-
BIL
BIP
Board
BVA (Brambles Value Added)
CAGR (Compound Annual
Growth Rate)
Cash Flow from Operations
Circular economy
CGPR
Company
Constant currency/constant FX
Continuing operations
time injuries, modified duties and medical treatments per million hours worked
Brambles Industries Limited, which was one of the two listed entities in the previous
dual-listed companies structure
Brambles Industries plc, which was one of the two listed entities in the previous dual-
listed companies structure
The Board of Directors of Brambles Limited, details of which are on pages 38 to 41
The value generated over and above the cost of the capital used to generate that
value. It is calculated using fixed June 2020 exchange rates as: Underlying Profit; plus
Significant Items that are part of the ordinary activities of the business; less Average
Capital Invested, adjusted for accumulated pre-tax Significant Items that are outside
the ordinary course of business, multiplied by 12%
The annualised percentage at which a measure (e.g. sales revenue) would have grown
over a period if it grew at a steady rate
Cash flow generated after net capital expenditure but excluding Significant Items that
are outside the ordinary course of business
A circular economy regenerates and circulates key resources, ensuring products,
components and materials are at their highest utility and value at all times
The Australian Securities Exchange Corporate Governance Council Corporate
Governance Principles & Recommendations, Fourth Edition
Brambles Limited (ACN 118 896 021)
Current period results translated into US dollars at the actual monthly exchange rates
applicable in the comparable period, so as to show relative performance between the
two periods
Continuing operations refers to CHEP Americas, CHEP EMEA and CHEP Asia-Pacific
(each primarily comprising pallet and container pooling businesses in those regions
operating under the CHEP brand), and Corporate (corporate centre including BXB
Digital)
Discontinued operations
Operations which have been divested/demerged, or which are held for sale
DRP (Dividend Reinvestment Plan)
The Brambles Dividend Reinvestment Plan, under which Australian and New Zealand
shareholders can elect to apply some or all of their dividends to the purchase of
shares in Brambles Limited instead of receiving cash
Economic value
A measure of the broader financial benefit provided by an organisation
EPS (Earnings Per Share)
Profit after finance costs, tax, minority interests and Significant Items, divided by the
weighted average number of shares on issue during the period
EBITDA (Earnings before Interest, Tax,
Depreciation and Amortisation)
Underlying Profit from continuing operations after adding back depreciation,
amortisation and IPEP expense
ELT
Brambles’ Executive Leadership Team, details of which are on pages 42 to 44
137
Glossary
Glossary continued
Emission scope
Free Cash Flow
FY (Financial Year)
Scope 1: carbon emissions from fuel combustion at Brambles’ operations and under
Brambles' direct control
Scope 2: carbon emissions resulting from grid electricity used in Brambles' operations.
While considered ‘indirect’, Brambles' level of control is considered high.
Scope 3: carbon emissions resulting from goods and services purchased. Also
considered ‘supply chain’ emissions.
Source: https://ghgprotocol.org/
Cash flow generated after net capital expenditure, finance costs and tax, but excluding
the net cost of acquisitions and proceeds from business disposals
Brambles’ financial year is 1 July to 30 June; FY21 indicates the financial year ended
30 June 2021
Group or Brambles
Brambles Limited and all of its related bodies corporate
Group Profit Leverage
Reflects the amount by which Underlying Profit growth exceeds sales revenue growth
IBCs (Intermediate Bulk Containers)
Palletised containers used for the transport and storage of bulk products in a variety
of industries, including the food, chemical, pharmaceutical and transportation
industries
IPEP (Irrecoverable Pooling Equipment
Provision)
Provision held by Brambles to account for pooling equipment that cannot be
economically recovered and for which there is no reasonable expectation of receiving
compensation
Key Management Personnel
Members of the Board of Brambles Limited and Brambles’ Executive Leadership Team
KPI(s)
LTI
Matching Awards
Matching Shares
MyShare
Operating profit
Performance Period
Key Performance Indicator(s)
Long-Term Incentive
Matching share rights over Brambles Limited shares allocated to employees when
they purchase Acquired Shares under MyShare; when an employee’s Matching
Awards vest, Matching Shares are allocated
Shares allocated to employees who have held Acquired Shares under MyShare for
two years, and who remain employed at the end of that two-year period; one
Matching Share is allocated for every Acquired Share held
The Brambles Limited MyShare plan, an all-employee share plan, under which
employees acquire ordinary shares by means of deductions from their after-tax pay
and must hold those shares for a two-year period. If an employee holds those shares
and remains employed at the end of the two-year period, Brambles will match the
number of shares that employee holds by issuing or transferring to them the same
number of shares they held for the qualifying period, at no additional cost to the
employee
Statutory definition of profit before finance costs and tax; sometimes called EBIT
(earnings before interest and tax)
A two-to-three-year period over which the achievement of performance conditions is
assessed to determine whether STI and LTI share awards will vest
Performance Share Plan or PSP
The Brambles Limited Performance Share Plan (as amended)
Profit after tax
RPCs
Profit after finance costs, tax, minority interests and Significant Items
Reusable/returnable plastic/produce container/crate, generally used for shipment and
display of fresh produce items
ROCI (Return on Capital Invested)
Underlying Profit divided by Average Capital Invested
Sharing economy
An economic system in which assets or services are shared between different agents,
either free or for a fee
138
Glossary
Glossary continued
Significant Items
Items of income or expense which are, either individually or in aggregate, material to
Brambles or to the relevant business segment and: outside the ordinary course of
business (e.g. gains or losses on the sale or termination of operations, the cost of
significant re-organisations or restructuring); or part of the ordinary activities of the
business but unusual because of their size and nature
STI
Short-Term Incentive
TSR (Total Shareholder Return)
Underlying EPS
Underlying Profit
Unification
Measures the returns that a company has provided for its shareholders, reflecting
share price movements and reinvestment of dividends over a specified performance
period
Profit after finance costs, tax and minority interests but before Significant Items,
divided by the weighted average number of shares on issue during the period
Profit from continuing operations before finance costs, tax and Significant Items
The unification of the dual-listed companies structure (between Brambles Industries
Limited and Brambles Industries plc) under a new single Australian holding company,
Brambles Limited, which took place in December 2006
Year
Brambles’ 2021 financial year
139
Glossary
Notes
Contact Information
Registered Office
Level 10 Angel Place, 123 Pitt Street
Sydney NSW 2000
Australia
ACN 118 896 021
Telephone: +61 (0) 2 9256 5222
Email:
investorrelations@brambles.com
Website:
www.brambles.com
London Office
Nova South
160 Victoria Street
London SW1E 5LB
United Kingdom
Telephone: +44 (0) 20 38809400
CHEP Americas
7501 Greenbriar Parkway
Orlando FL 32819 USA
Telephone: +1 (407) 370 2437
5897 Windward Parkway
Alpharetta GA 30005 USA
Telephone: +1 (770) 668 8100
CHEP Europe, Middle East, Africa & India
400 Dashwood Lang Road
Bourne Business Park
Addlestone, Surrey KT15 2HJ
United Kingdom
Telephone: +44 (0)1932 850085
Facsimile: +44 (0)1932 850144
CHEP Asia-Pacific
Level 6, Building C,
11 Talavera Road
North Ryde NSW 2113
Australia
Telephone: +61 13 CHEP (2437)
Facsimile: +61 (0) 2 9856 2404
Investor & Analyst Queries
Telephone: +61 (0) 2 9256 5238
Email:
investorrelations@brambles.com
Share Registry
Access to shareholding information is available to investors
through Boardroom Pty Limited
Boardroom Pty Limited
GPO Box 3993, Sydney NSW 2001, Australia
Telephone: 1300 883 073 (within Australia)
+61 (0) 2 9290 9600 (from outside Australia)
Facsimile:
+61 (0) 2 9279 0664
Email:
brambles@boardroomlimited.com.au
Website:
www.boardroomlimited.com.au
Share Rights Registry
Employees or former employees of Brambles who have queries
about the following interests:
Performance share rights under the performance share plans;
Matching share rights under MyShare; or
Shares acquired under MyShare or other share interests held
through Sargon CT Pty Ltd, may contact Boardroom Pty Limited,
whose contact details are set out above.
American Depository Receipts Registry
Deutsche Bank Shareholder Services
American Stock Transfer & Trust Company Operations Centre
6201 15th Avenue Brooklyn NY 11219 USA
Telephone: +1 866 706 0509 (toll free)
+1 718 921 8124
brambles.com
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