CAPRAL LIMITED
ABN 78 004 213 692
ANNUAL REPORT 2024
3
Key Statistics
5
Chairman’s Report
9
Managing Director’s Operations and Financial Review
12
Board of Directors
15
ESG and Sustainability Report
21
Directors’ Report
25
Remuneration Report (Audited)
42
Auditor’s Independence Declaration
43
Consolidated Statement of Profit or Loss and Other Comprehensive Income
44
Consolidated Statement of Financial Position
45
Consolidated Statement of Cash Flows
46
Consolidated Statement of Changes in Equity
48
Notes to the Consolidated Financial Statements
97
Directors’ Declaration
104 Member Details
107 Corporate Directory
Contents
2
Capral Limited — Annual Report 2024
2024
2023
Variance
For the year ended 31 December
Sales Volume - Tonnes
67,790
71,060
(3,270)
$m
$m
$m
Revenue
649.7
656.9
(7.2)
EBITDA1
58.3
61.5
(3.2)
Profit after Tax
32.5
31.8
0.7
Operating Cash Flow
52.7
75.0
(22.3)
Net Cash
68.9
59.5
9.4
1 Please refer to notes on page 7
Key
Statistics
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Capral Limited — Annual Report 2024
4
Capral Limited — Annual Report 2024
Chairman’s
Report
Annual Review
Capral delivered a resilient operational performance in FY24
despite the more challenging economic conditions. With
increasing diversification in the channels that Capral
operates in, the business is better positioned to perform
strongly through cycles. The robustness of Capral’s
performance is also underpinned by the 2019 operational
restructure that permanently lowered Capral’s cost base,
enabling the business to better leverage the capacity
utilisation of its extrusion plants.
For the year ended 31 December 2024 Capral delivered
EBITDA1 of $58.3 million compared to $61.5 million in the
prior year. EBIT1 fell 10% to $34.5 million as compared to
$38.5 million in 2023. Net Profit After Tax (NPAT) of $32.5
million compares to $31.8 million in 2023. NPAT in 2024
was assisted by a tax benefit of $3.6 million from the
increased recognition of deferred tax assets (2023: Nil).
Revenues of $650 million in 2024 were on par with the prior
year. Average selling prices increased by 4% as a result of
higher global aluminium prices (LME), this largely offset the
impact from 5% lower volume.
In FY24 Capral delivered earnings per share of $1.88
(including $0.21 of tax benefit), compared to prior year
of $1.77.
Demand in Capral’s key industrial sectors remained solid
through the year with 2024 volumes growing compared to
the prior year. This was driven by; recent acquisitions,
retention of market share gains against imports, and
strength in the transport and infrastructure segments. The
residential construction segment, which contributes around
40% of Capral’s volume, slowed through the year as
expected.
Capral’s extrusion operations responded in line with the
lower volume by reducing production shifts, cost reduction
activities, and operational efficiency programs. Capral
expects residential construction activity to improve during
the second half of FY25.
1 EBITDA, EBIT and Earnings per Share are presented with reference to the ASIC Regulatory Guide 230
“Disclosing non-IFRS financial information” issued in December 2011.
Capral completed two further distribution business
acquisitions during the year to fill gaps in its network and
grow this channel. The acquired businesses have been
successfully integrated into the Capral network.
Working capital was $87.7 million at the of FY24, slightly
higher than $86.7 million at the end of FY23. Capral
continues to have a strong balance sheet with a year-end
net cash balance of $68.9 million which enables the
business to invest in ongoing operations, seek growth
opportunities, and deliver to shareholders sustainable
capital management strategies.
Capral continued its work on anti-dumping of aluminium
extrusions into the Australian market to help ensure fair
competition in the markets in which we operate. This will
continue in FY25 and beyond.
Capital Management
The Capral board is committed to ensuring that capital
allocation priorities are balanced between investment
opportunities for growth through acquisitions, growth and
maintenance capital expenditure, working capital funding,
and distributions to investors.
Having prioritised the return of franking credits to
shareholders in prior years, the payment of the fully franked
final dividend of 35 cents per share for the year ended 2023
exhausted all franking credits. Capral still has substantial
tax losses to carry forward, therefore any dividends which
may be paid in the medium term will be unfranked.
Capral began an on-market share buy-back in 2023, and
commenced another on-market share buy-back in March
2024 which resulted in an equivalent distribution of 36 cents
per share in FY24.
In addition, Capral has declared an unfranked final dividend
of 40 cents per ordinary share (2023: 35 cents fully franked)
to be paid on 26 March 2025 in respect of FY24. The
5
Capral Limited — Annual Report 2024
dividend will be paid to all shareholders on the register
of members as at the record date of 5 March 2025.
The Dividend Reinvestment Plan will not be active for
this dividend.
For FY24 Capral will have returned the equivalent of 76
cents per share consisting of 40 cents in cash
dividends and 36 cents by way of share buy-backs
completed during the year. This compares with the
equivalent of 72.5 cents for FY23 (55 cents dividends
and 17.5 cents share buy-backs).
Capral will commence another on-market share
buy-back of up to 10% of its issued shares on or about
3 March 2025. Capral’s board will continue to ensure
that distributions to shareholders remains a key
component of Capral’s capital allocation policy. It is
anticipated that, subject to share trading liquidity, share
buy-backs will form a major portion of value returned
to our shareholders.
Safety and Sustainability
Capral remains committed to pursuing excellence in its
delivery of effective safety and sustainability programs
across all parts of its business. While the number of
reportable injuries increased in FY24, Capral’s injury
rate remains below reported peer averages.
The environment is a key priority for Capral. We have
committed to Net Zero by 2050 (scope 1 and 2
emissions), and a 20% reduction in emissions by 2030,
we are on-track to meet these targets.
Capral retained its Aluminium Stewardship Initiative
(ASI) certification in both performance standard and
chain of custody that it achieved in 2023. In addition,
Capral is well advanced with its plans to meet the new
climate change reporting requirements for 2025.
Capral’s LocAl®, our lower carbon aluminium brand,
continues to be a focus with volumes growing
significantly in 2024. In addition, Capral has trialled
recycling mill scrap aluminium back into the billet
casting process through the Rio Tinto Boyne smelter.
Investigations with other smelters to recycle extrusion
scrap are also ongoing.
The Sustainability Report in the annual report details
the many well-advanced initiatives in progress.
Board Renewal
As previously announced Rex Wood-Ward retired from the
board and as chair at the conclusion the AGM on 8 May
2024. On behalf of the Board, I would like to take this
opportunity to thank Rex for the significant contribution he
has made to Capral since his appointment in 2008.
Looking Ahead and Acknowledgements
We expect the detached housing sector to start recovering in
FY25 with the benefits flowing through in the second half.
The industrial sector is forecast to maintain its current
resilience. External factors are likely to result in a
continuation in the volatility of commodity prices. Inflation
and other cost increases, particularly in energy and labour
costs, will also have an impact.
Capral remains committed to continuing to improve its
operational efficiency throughout the organisation together
with its commitment to investing in growth and returning
capital to shareholders going forward.
On behalf of the board I want to thank our shareholders, all of
the Capral team, and our other stakeholders for their strong
support during 2024. Thank you to my co-directors for their
contributions throughout the past year.
Shareholders are directed to the Results Presentation
released to the market.
Mark White
Chairman
Chairman’s Report
6
Capral Limited — Annual Report 2024
2024
2023
Performance Measures
$ million
$ million
Profit After Income Tax
32.5
31.8
Less: Income Tax Benefit
(3.6)
-
Profit Before Income Tax
28.9
31.8
Add: Finance Costs
5.6
6.7
Add: Depreciation and Amortisation
23.8
23.0
EBITDA (Earnings Before Income Tax, Depreciation and Amortisation)
58.3
61.5
Less: Depreciation and Amortisation
(23.8)
(23.0)
EBIT
34.5
38.5
Profit After Income Tax
32.5
31.8
Less: Income Tax Benefit
(3.6)
-
Net Profit Before Income Tax
28.9
31.8
Weighted Average Number of Ordinary Shares on Issue (Basic)
17.3
17.9
EPS
$1.88
$1.77
Chairman’s Report
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Capral Limited — Annual Report 2024
8
Capral Limited — Annual Report 2024
Managing Director’s
Operations and
Financial Review
Hightlights
• Strong earnings result in a soft market, and 8% above top-end guidance
• Sales revenue $650 million, on par with last year
• Volume at 67,800 tonnes, 5% down on last year
• EBITDA1 $58.3 million, down $3.2m on last year
• EBIT1 $34.5 million, down $4.0m on last year
• NPAT $32.5 million (included $3.6m tax benefit), up $0.7m on last year
• Earnings per share at $1.88, up $0.11 on last year
• Balance sheet strong with net cash of $68.9 million
• Unfranked final dividend of 40 cps declared, total FY24 dividend of 40 cps (FY23:55cps)
• Total distribution to shareholders 76 cps, includes share buy-back equivalent of 36 cps
• Good safety performance with a TRIFR of 7.7
• Carbon emissions reduction tracking ahead of target
Financial Review
Market conditions were softer in 2024 mainly due to a
slow-down in activity in the residential housing market.
Capral also experienced reduced demand from aluminium
distributors as import supply chains returned to normal.
Volume however remained solid in our industrial markets
which allowed Capral’s manufacturing plants to run at
good levels of efficiency.
The residential housing market slowed, impacted by high
interest rates and affordability. Housing starts are
estimated to be 167,800² in 2024, slightly above the prior
year and down around 25% from the highs of 2021 and
2022. Commercial construction activity also slowed
during the year. Key industrial markets remained relatively
strong, especially the transport and infrastructure
segments, and we retained market share gains in the
metal fabrication sector.
The international LME price of aluminium lifted during the
year finishing at two year highs, driven primarily by
international trade and tariff concerns post the USA
election. Capral’s average LME cost for 2024 was 5%
above last year. This flowed through to higher selling
prices and working capital levels.
Despite the slower economic conditions Capral delivered
another very good profit result in 2024 with EBITDA of
$58.3 million (2023: $61.5m) on 5% lower volume, and EBIT
of $34.5 million (2023: $38.5m). A very pleasing result,
demonstrating how far Capral has progressed in being
able to deliver solid earnings during a slow-down in the
housing market.
Capral ended 2024 with a Net Cash balance of $68.9
million. Debtor collection performance remained very good.
Inventory levels rose slightly but higher LME prices lifted
inventory value, leading to higher working capital levels
which will likely continue to rise in the year ahead.
Capral will pay an unfranked final dividend of 40 cents per
share (FY23: 55cps). Capral completed an on-market share
buy-back during the year equivalent to 36cps, taking total
2024 distributions to shareholders to 76cps (FY23:
72.5cps). Capral will continue its on-market share buy-back
program during 2025 under the 12-10 rule. As advised last
year, Capral exhausted its franking credit balance in 2023,
therefore shareholder distributions in the medium term will
be by way of unfranked dividends and/or share buy-backs.
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Capral Limited — Annual Report 2024
Key Initiatives and Strategies
Key high-level strategies remain consistent with prior years:
• Build on our strengths
Product offer, scale, capability, and our people
• Optimise what we do
Continuous improvement in all aspects of our business
• Grow for the future
Develop innovative products, enhance our capability,
expand our footprint
In 2025 we will continue to focus on our Smithfield and
Penrith extrusion plants. Smithfield will focus on upgrading
equipment to improve plant reliability and productivity. The
first stage of the Penrith plant upgrade, replacing the
extrusion press, was completed during 2023. The second
stage, replacing the billet furnace and saw, will be completed
in 2025.
We will continue to grow Capral’s distribution operations
with the objective of increasing the volume and profitability
of Capral’s direct-to-market channel. During 2024 we added
two Aluminium Trade Centres to the Capral distribution
footprint with acquisitions of existing businesses in
Melbourne and Brisbane. This makes a total of four new
sites over the last few years. We continue to seek other
opportunities to expand our distribution footprint and into
other adjacent market segments.
Fair Trade
Capral continues to lead the local industry in the pursuit of
fair trade. Key points to note are:
• Application submitted for continuation of measures on
Chinese imports for a further five years.
• China recently announced the removal of export VAT
rebates which should see a lift in import pricing in 2025.
• Measures against Malaysian and Vietnamese imports
remain in place until 2028.
While some share gains have been made over the last few
years, imports still represent over a third of the total
Australian extrusion market. Now that supply chains have
normalised, and international trade flows are in a state of
flux, it is even more important that we continue the fight to
retain a fair share for the local extrusion industry which
contributes over 2,000 direct jobs to the Australian economy.
Safety
Safety is the first of Capral’s five key values. We continue
our focus on risk assessment, training, systems, and our
safety culture. Capral recorded a total reportable injury
frequency rate (TRIFR) of 7.7, slightly better than our peer
group average. Lost time injuries remained at four, but
medical treatment injuries increased by five to nine.
Importantly, lost and return to work hours fell by 38% on
the prior year.
Sustainability and ESG
Capral’s journey to net zero emissions by 2050, with a
20% reduction target by 2030, is on-track and progressing
well. During the 2023/24 year Capral’s scope 1 & 2 total
emissions fell by 9% and intensity fell by 5%. This was a
result of operational energy efficiencies and an increase
in renewable energy sources.
During 2024 Capral increased its focus on waste
management and recycling by introducing various
programs at key sites. These initiatives lead to an increase
in recycling and a 12% reduction in waste from baseline.
Capral maintained its Aluminium Stewardship Initiative
(ASI) certification and remains the only extruder in the
region to secure this globally recognised certification.
This enables Capral to offer ASI certified aluminium to the
Australian market, including lower-carbon aluminium
options under our trade mark brand LocAl®.
LocAl® lower-carbon aluminium is gaining traction in the
market with volumes lifting by close to four times over the
prior year.
Capral has considered the overall impact of current ESG
issues and has not discovered any resulting material
impact on our consolidated financial statements at this
point. Capral is well-placed to meet the requirements of
new climate reporting standards for FY25. Further details
are contained in Capral’s Sustainability Report.
Managing Director’s Operations and Financial Review
10
Capral Limited — Annual Report 2024
Key Operating Risks
Capral has a robust risk assessment process and active risk
mitigation programme, key risks include:
• Significant slow-down in economic activity, particularly
the new housing market
• Increased level of imported aluminium extrusion and
increased local competition from new entrants
• External IT threats such as cyber attacks
• Changes in construction methodology to meet more
stringent sustainable building codes
Outlook
Forecasts for the residential market show detached housing
approvals lifting in 2025 as interest rates start to fall. Total
residential starts in 2025 are forecast2 to be slightly higher
than 2024, however the pipeline of work that sustained
volumes over the past two years has been completed. The
non-residential market is forecast to be steady in 2025 as
are our key industrial markets.
LME is volatile and subject to international influences. The
threat of tariffs by the new elected USA government led to
LME soaring in early 2025 to its highest level since the
Russian invasion of Ukraine in 2022. Based on external
forecasts3, Capral expects LME to remain at elevated levels
throughout the coming year on the back of higher global
demand and uncertainty. This will lead to increased working
capital levels in 2025. The recently announced 25% tariff by
the USA government on steel and aluminium will not have a
direct impact on Capral. However, it could influence
international trade flows and Australia must be vigilant in
maintaining a robust anti-dumping regime to ensure a level
playing field for local manufacturers.
The overall market for Capral’s aluminium products is
forecast to remain steady during 2025, and we expect to
retain a good proportion of post-Covid market share gains
from imports. On this basis, at this time and absent any
unforeseen events, we expect earnings for FY25 to be
broadly in line with prior year. Therefore Capral should be in
a position to continue to return capital to shareholders by
way of share buy-backs and unfranked dividends.
The focus in the year ahead will be to deliver benefits from
the recent Trade Centre acquisitions in Victoria and
Queensland, complete the second stage of the Penrith plant
upgrade, and continue to grow our distribution business
through both acquisition and organic growth. We plan to
enhance our range, service, and capability to grow our
customer base and deliver strong ongoing profitability.
I wish to thank the Capral team for their contribution to a
very pleasing 2024 result. Capral remains in a good position
to capitalise on its extensive capabilities, take opportunities
as they present, and grow the business for the future.
Tony Dragicevich
Managing Director
26 February 2025
Managing Director’s Operations and Financial Review
1 Refer to EBITDA, EBIT and Earnings per Share (EPS) explanation in footnotes to Chairman’s Report
2 HIA February 2025
3 LME forecast - Harbour Aluminium Consensus Forecast (February 2025)
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Capral Limited — Annual Report 2024
Board of Directors
Directors in office during the financial year and up to the date of this report (unless otherwise stated):
Tony Dragicevich B. Comm A.C.A
Managing Director (Non-independent)
Appointed 15 April 2013
Mr Dragicevich joined Capral in January 2013 and became the Managing Director
and Chief Executive Officer on 15 April 2013. Mr Dragicevich is an experienced
CEO and business leader who has been involved in the improvement of a number
of businesses, having previously served as Managing Director of the Wattyl
Group, and as Chief Executive of GWA Bathroom and Fittings, Managing Director
of the Red Paper Group and General Manager of Tasman Insulation.
Directorships of other listed companies held in last 3 years before end of the Financial year:
Non-executive director of Fletcher Building Group: 1 August 2024 to date of this report.
Mark White B. Com, M. Com, ACA, GAICD
Chairman of the Board (Independent)
Appointed 1 September 2021
Chairman of the Board (appointed 8 May 2024)
Member of the Audit & Risk Committee
Member of the Remuneration & Nomination Committee
Mr White has extensive experience obtained from executive management and
leadership positions from over 25 years in the aluminium and building materials
sectors in Australia and Asia. He has deep operational experience and is a proven
P&L leader with strategic management in complex and high risk operating
environments. Until July 2024, Mr White was General Manager of CSR Limited’s
aluminium business with its share in the Tomago aluminium smelter joint venture.
Mr White was also Executive Director on the Board of Tomago aluminium smelter
for more than 13 years and was Chair of Tomago’s Audit and Risk committee.
Directorships of other listed companies held in last 3 years before end of the Financial year:
None
Rex Wood-ward
Previous Chairman of Board (Independent)
Appointed 6 November 2008. Retired 8 May 2024.
Chairman of the Board
Member of the Audit & Risk Committee
Member of the Remuneration & Nomination Committee
Mr Wood-Ward has 50 years of experience in general management, mergers and
acquisitions, corporate strategy, and structuring, including in manufacturing and
distribution. Over his career he has been a director of over 10 publicly listed
companies in Australia, the United Kingdom, and South Africa.
Directorships of other listed companies held in last 3 years before end of the Financial year:
None
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Capral Limited — Annual Report 2024
Katherine Ostin B. Comm, GAICD, F FIN, CA
Non-executive director (Independent)
Appointed 17 June 2020
Chairman of the Audit & Risk Committee.
Member of the Remuneration & Nomination Committee
Ms Ostin is a Chartered Accountant and an experienced company director with
significant experience in finance and accounting, audit, risk, governance, strategy
and business development. She is currently a non-executive director of a diverse
portfolio of both listed and non-listed companies and is Chair of the respective
Audit & Risk Committees. She has also previously served as a non-executive
director of several not-for-profit entities. Ms Ostin was a senior Partner in Audit
Assurance & Risk Consulting with KPMG, holding various leadership roles over
her 12 years as a Partner from 2005 to 2017. In her 24 years with KPMG she
worked across a broad number of sectors in Australia, Asia, the US and the UK.
Directorships of other listed companies held in last 3 years before end of the Financial year:
Non-executive director of Swift Media Ltd: 1 October 2019 to 19 November 2021.
Non-executive director of Dusk Group Ltd (ASX: DSK): 16 September 2020 to date of
this report.
Non-executive director of 3P Learning Ltd (ASX: 3PL): 6 August 2021 to date of this report.
Non-executive director of Next Science Limited (ASX: NXS): 24 October 2023 to date of
this report.
Non-executive director of Elanor Investor Group Limited (ASX: ENN) and Elanor
Commercial Property Fund (ASX: ECF): 1 January 2024 to date of this report.
Non-executive director of Healius Ltd (ASX:HLS): 1 December 2024 to date of this report
Bryan Tisher B. Eng, MBA
Non-executive director (Independent)
Appointed 24 February 2022
Chairman of the Remuneration & Nomination Committee from 27 April 2023
Member of the Audit & Risk Committee.
Mr Tisher has extensive experience in the resources, building materials and
electrical products sectors. He is currently the Chief Executive Officer of Legend
Corporation, an Australian leader in industrial and electrical products and
previously held senior positions at Orica, Boral, and Rio Tinto.
Mr Tisher was the Managing Director of Orica Asia responsible for manufacturing
and distribution operations covering 14 countries, and the Divisional Managing
Director of Boral Building Products responsible for the Plasterboard Australia,
Timber, Bricks, Roofing, Masonry and Windows business units. He has had
extensive board experience as an Executive Chairman for six joint ventures in
Asia and the Boral Carter Holt Harvey Softwood Manufacturing Joint Venture at
Oberon, and, as a Non-executive Director at Sustainable Timber Tasmania and
Cape York Enterprises.
Directorships of other listed companies held in last 3 years before end of the Financial year:
None
Board of Directors
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Capral Limited — Annual Report 2024
14
Capral Limited — Annual Report 2024
ESG and
Sustainability
Report
Safety
At Capral, maintaining a secure and healthy workplace is
our first priority. We view safety as an ongoing journey of
collaborative improvement. Our approach integrates
targeted training and proactive data analysis to help ensure
a safe working environment where risks are effectively
managed and mitigated.
During the past year Capral’s Integrated Management
System (IMS) was enhanced by adding mobile capabilities.
Deploying tablets across our sites has enabled real-time
data capture, providing immediate identification of hazards
and implementation of corrective measures. This ensures
that every incident, near-miss, or potential risk is recorded
and addressed promptly, thereby enhancing our overall
responsiveness.
We also introduced an in-house safety training program.
This training empowers our teams with the skills necessary
to identify and control hazards on site. By focusing on
practical, site-specific scenarios, the program ensures that
our workforce is not only aware of potential risks but also
equipped to act decisively when challenges arise. This has
driven a proactive risk management culture.
To further reinforce our safety strategy Capral has
integrated advanced data analytics into our systems. By
leveraging predictive tools, we can analyse both historical
and real-time data, identifying emerging patterns and
potential areas of concern before they evolve into significant
issues. This allows us to implement preventative measures
more effectively, strengthening our safety protocols and
reducing the likelihood of incidents.
Capral's Total Reportable Injury Frequency Rate increased
to 7.7 as reportable injuries increased by 4 in 2024. This
continues to be below the average for listed building
products manufacturers and reflects our commitment to
maintaining high safety standards and the success of our
integrated approach to risk management.
ESG & Sustainability
In 2021 Capral embarked upon a journey to lower carbon
emissions across our operations. Reducing our
environmental impact is an essential element of our
corporate responsibility framework and our vision for a
sustainable future. Our Sustainability Roadmap is closely
aligned with the UN Sustainable Development Goals and the
Global Reporting Initiative. This year, we have taken
significant steps to enhance transparency and
accountability in our reporting and day-to-day operations.
Our improved clarity of greenhouse gas emissions across
Scope 1, 2, and 3 is a significant development. We have
refined our tracking systems to deliver comprehensive data
on our emissions, from cradle to gate. Capral's IMS
incorporates lifecycle assessments and tracking of Scope 3
emissions, giving a more complete picture of our
environmental impact. This increased transparency not only
supports our internal targets but also provides our
customers with accurate insights into the ecological
footprint of our operations.
Our ongoing efforts to reduce emissions are supported by
strategic investments in energy-efficient technologies and a
gradual transition towards renewable energy sources. The
advancements achieved in lowering carbon emissions
across our operations demonstrates our commitment to
meeting our long-term sustainability goals.
Capral’s lower carbon aluminium, marketed under our
proprietary LocAl® brand, has gained substantial industry
interest and has reinforced Capral's position as the leader in
sustainable aluminium extrusion production in Australia.
Combined with our Aluminium Stewardship Initiative (ASI)
certification, this underlines our commitment to producing
more sustainable materials. We have initiated the process
of aligning our sustainability reporting with the Australian
Sustainability Reporting Standards (ASRS). This will ensure
that our environmental performance data is accurate and
transparent to our stakeholders. This year, to align with
ASRS, we are reporting calendar year sustainability data to
line-up with Capral’s December financial year.
15
Capral Limited — Annual Report 2024
0
5,000
10,000
15,000
20,000
2022 Baseline
2023
2024
18,810
17,210
6,750
7,190
7,410
16,650
TOTAL
RECYCLING
Waste Management and
Circular Economy
Capral acknowledges that effective waste management is
important as it constitutes a secondary production chain.
By leveraging data analytics, we have mapped our national
network across waste streams, from packaging and
chemicals to general waste. This comprehensive approach
provides us with a clear understanding of waste generation
at every stage of our operations.
Over the past year, we have conducted waste trials at
several sites to identify best practices that can be
implemented on a national scale. These trials yielded
valuable insights into the most effective strategies for
reducing waste and optimising recycling processes. By
understanding the specific challenges and opportunities
within each waste stream, we are better equipped to
improve our waste management practices.
This year is Capral’s first publication of waste data. We are
aiming to improve processes, minimise waste, and increase
the use of recyclable materials in production.
These initiatives are key to our broader sustainability
strategy. By using data insights and proactive waste
management, Capral leads the local industry in sustainable
operations supporting a more circular economy. We are
committed to improving processes and reducing waste for
both business and environmental benefits.
Waste (m3)
Alongside these initiatives, we have been evaluating the
inclusion of recycled content aluminium into our process.
This is a component of our broader commitment to
enhancing our circular economy, optimising resource
utilisation, and minimising waste across our operations.
Through these initiatives Capral is advancing its
sustainability position and will keep our stakeholders
informed as we progress towards a more sustainable future.
Aluminium Stewardship Initiative (ASI)
and Lower Carbon Aluminium (LocAl)
Capral remains the only ASI certified aluminium extruder in
Australia. ASI is a globally recognised accreditation body that
sets rigorous standards for responsible practices across the
aluminium value chain including focus on ESG requirements.
This places Capral among a select group of businesses that
meet the highest international benchmarks.
In parallel, we continue to focus on innovation in sustainable
product development. Capral’s lower-carbon aluminium,
LocAl®, is produced with energy generated from lower carbon
emitting sources during the smelting phase.
By incorporating audit processes, product innovation, and
certification systems Capral is setting new industry
benchmarks in terms of sustainable aluminium supply.
ESG and Sustainability Report
16
Capral Limited — Annual Report 2024
Modern Slavery and Ethical Sourcing
At Capral, we seek high ethical standards in our supply chain.
Our Supplier Code of Conduct requires our partners to follow
appropriate environmental, social, and governance practices.
This helps to combat modern slavery and promote
responsible sourcing in our supply chain.
Annual risk assessments of our suppliers is conducted to
identify and address potential issues, especially in
geographies prone to modern slavery. This allows for early
intervention and implementation of corrective measures.
Furthermore, we have strengthened our supplier oversight by
expanding our Whistle Blower programme. This confidential
reporting channel now includes procurement and supplier
practices, allowing ethical concerns to be raised and
addressed promptly.
Through these ongoing initiatives, we aim to advance ethical
sourcing and modern slavery prevention thereby setting a
standard for sustainable practices within our industry.
Freight Management and
Packaging Initiatives
We continue to evolve freight and packaging practices to
support our sustainability goals and enhance supply chain
efficiency. This year, we introduced several initiatives
aimed at reducing our environmental impact and
streamlining operations.
We have implemented the use of scrap metal skip-bins
within our closed-loop system. These bins are collected
from our customers for re-use or recycling, minimising
waste and promoting resource efficiency.
Efforts are being made to identify and address sub-
standard practices in our supply chain through collaboration
with logistics partners and regular audits.
During the year we launched a new freight management
software application. This digital tool streamlines our
processes by providing real-time data to support our
customers. With sustainability tracking and hazard
management features the system also supports
environmental and safety objectives.
This demonstrates Capral’s commitment to innovative and
sustainable freight management and packaging practices.
By integrating advanced technology, and continually refining
our supply chain processes, we are making significant
strides toward a more sustainable future.
ESG and Sustainability Report
17
Capral Limited — Annual Report 2024
ESG and Sustainability Report
In 2022, Capral’s baseline Scope 1 (gas) and Scope 2
emissions (electricity) totalled 38360t. Total emissions
fell in 2023 to 36,690t, and in 2024 they fell a further 9%
to 33,320t. These reductions are a result of our targeted
emission reduction strategies. In 2022, Capral’s
emissions intensity was 0.67 tCO₂e per tonne of
aluminium produced. This fell to 0.64 in 2023, and a
further 5% to 0.61 in 2024.
Capral’s target is net zero by 2050 with an interim target
of a 20% reduction in carbon emissions by 2030. We are
currently tracking ahead of that target due to emission
reduction initiatives, such as; operational energy
efficiency programs, process improvements, and an
increased mix of renewable energy sources. Ongoing
investments in low-carbon technologies, further process
optimisations, and an increasing use of renewable energy
will drive future reductions.
0
5,000
15,000
25,000
35,000
10,000
20,000
30,000
40,000
2022 Baseline
2023
2024
38,360
36,690
33,320
SCOPE 1
SCOPE 2
9,470
9,790
9,450
28,890
26,900
23,870
Carbon Emissions
0
5,000
15,000
25,000
35,000
10,000
20,000
30,000
40,000
2022
2023
2024
2025
2026
2027
2028
2029
TARGET
ACTUAL
Carbon Emissions Reduction Plan
Environmental Impact and Carbon Emissions Overview
18
Capral Limited — Annual Report 2024
ESG and Sustainability Report
Capral's commitment to sustainability goes beyond
environmental stewardship. In addition to our focus on
responsible resource use, we are investing in developing
our workforce to ensure we remain at the forefront of a
sustainable future. We recognise that our employees are
the backbone of our success. Through partnerships with
various training organisations, we offer comprehensive
upskilling opportunities that promote personal and
professional growth. This approach ensures our teams
develop the skills needed to navigate the evolving
demands of our business landscape.
In addition to our focus on employee development, we
prioritise community engagement. Our corporate social
responsibility culture is reflected in the wide range of
social initiatives we support. These include; campaigns to
raise awareness of mental health (R U Ok? Day),
domestic violence (Strive To Be Kind), and men’s health
(Movember). These efforts have attracted a high level of
employee involvement.
Capral supports various charity and social organisations,
underscoring our broader commitment to societal well-
being. Through these combined initiatives, Capral aims to
support positive change, not only within our organisation
but also in the wider community. These include:
• Allison Baden-Clay – Strive To Be Kind
• Beyond Blue
• Cancer Research
• Children’s Hospital
• Dandelions WA
• Disability Sports Victoria
• Festival of Magic
• Fiona Wood Foundation
• Food Bank
• Gooda Street Life
• Leaps and Bounds Disability Services
• Lions Australia
• Movember
• Rotary Down Under
• Sculpture by the Sea
• Springfield Carols
• Starlight Foundation
• TAC Q
• Tracey Village Cricket Club
• University of Wollongong
• Westmead Hospital Foundation
Employee Development and Social Responsibility
19
Capral Limited — Annual Report 2024
20
Capral Limited — Annual Report 2024
Directors’
Report
Directors
The following persons were directors of Capral except as
indicated below:
Name
Period Office Held
M. White
1 September 2021 – Date of this report
R. L. Wood-Ward
6 November 2008 – 8 May 2024
A. M. Dragicevich
15 April 2013 – Date of this report
K. Ostin
17 June 2020 – Date of this report
B. Tisher
24 February 2022 – Date of this report
Details of directors, their qualifications, experience, special
responsibilities (including committee memberships) and
directorships of other listed companies held in the last
three years before end of the Financial Year are set out
on page 12-13.
Principal activities
During the Financial Year, the principal continuing activities
of the consolidated entity consisted of the manufacturing
and distribution of fabricated and semi-fabricated
aluminium related products.
Dividends and buy-backs
The Directors recommend that a final dividend of 40 cents
per ordinary share (unfranked) be declared. The record date
for the final ordinary dividend will be 5 March 2025, with
payment being made on 26 March 2025. Capral’s Dividend
Reinvestment Plan (DRP) will not be active for this dividend. A
final dividend of 35 cents per ordinary share (fully franked)
was paid in March 2024 in respect of the 2023 financial year,
no other dividends have been paid during the Financial Year.
During 2024, 653,825 shares were bought back on-market at
a cost of $6,218,530, and subsequently cancelled.
Review of operations and
financial position
A review of operations and financial position of the
consolidated entity are referred to in the Managing Director’s
Operations and Financial Review on pages 9 to 11.
Significant changes in the state of affairs
There were no significant changes in the state of affairs of
the consolidated entity during the year.
Matters subsequent to the end of the
Financial Year
No other matter or circumstance, other than declaration of
the dividend disclosed above, has arisen since the end of the
Financial Year that has significantly affected, or may
significantly affect the consolidated entity’s operations, the
results of those operations or the consolidated entity’s state
of affairs in future financial years.
Your directors present their report on the consolidated entity consisting of Capral Limited (the Company or
Capral) and the entities it controlled at the end of, or during, the financial year ended 31 December 2024
(Financial Year).
21
Capral Limited — Annual Report 2024
Likely developments, business strategies,
prospects and risks
Information on likely developments, business strategies,
prospects and risks are detailed in the Managing Director’s
Operations and Financial Review on pages 9 to 11 and the
Sustainability Report on pages 15 and 19. Whilst Capral
continues to meet its continuous disclosure obligations, this
report omits information where it would be likely to result in
unreasonable prejudice to Capral. This includes information
that is commercially sensitive, is confidential or could
provide a third party with a commercial advantage (such as
internal budgets and forecasts).
Other information for members to make
an informed assessment
Other than information set out in this report, there is no
information that members would reasonably require to
make an informed assessment of the operations, financial
position, business strategies and prospects for future
financial years of the consolidated entity.
Company Secretary
Ms L Osbich
Joint Company Secretary
BA (Hons), LLB, GradDip Legal Practice
Ms Osbich is an employee of Company Matters Pty Ltd, a
company secretarial service provider. Prior to joining
Company Matters, Ms Osbich was employed by ASX as a
Listings Compliance Advisor and prior to that, worked
predominantly in the online legal publishing space with
over 15 years’ experience extending to senior roles with a
technical legal research focus.
Ms Osbich has also worked as a Legal and Compliance
Research Consultant focusing on putting together
practical content in relation to governance, risk and
compliance programs, particularly focused on the financial
services and banking sectors. Ms Osbich was appointed
as Company Secretary on 19 April 2023.
Mr T Campbell
Chief Financial Officer and Company Secretary
B.Com (Hons), CA
Mr Campbell was appointed Chief Financial Officer on 1
June 2011 and is a member of the Australia and New
Zealand Institute of Chartered Accountants. Prior to joining
Capral, Mr Campbell held various executive positions at
UXC, Macsteel and The South African Breweries. Mr
Campbell was appointed as Company Secretary on
8 March 2019.
Directors’ Report
22
Capral Limited — Annual Report 2024
Directors’ meetings
The numbers of directors’ meetings (including meetings of committees) held, and the number of meetings attended, by each
director during the Financial Year, are as follows:
Director
Board
Audit & Risk
Committee
Remuneration & Nomination
Committee
Held
Attended
Held
Attended
Held
Attended
R.L. Wood-Ward1
4
4
1
1
1
1
A.M. Dragicevich2
9
9
4
4
2
2
K. Ostin
9
9
4
4
2
2
M. White
9
9
4
4
2
2
B. Tisher
9
9
4
4
2
2
1 Meetings up to retirement on 8 May 2024
2 Attended meeting(s) in an ex-officio capacity
Directors’ interests and benefits
Ordinary Shares
Details of holdings of ordinary shares in Capral for the directors (including former directors who held office during the
Financial Year) at the beginning and end of the Financial Year and at the date of this report are as follows:
Ordinary shares fully paid in the Company
Name
Position
Balance at
1.1.2024
Balance at
31.12.2024
Balance at date of
this report
R.L .Wood-Ward
Director and Chairman of the Board4
-
-3
-
A.M. Dragicevich
Managing Director
566,794
618,2571
618,257
K. Ostin
Director
-
-
-
M. White
Director and Chairman of the Board4
-
1,0472
1,047
B. Tisher
Director
-
4,5002
4,500
1 Acquired 5,724 as part of 2023 STI programme on 11 March 2024. Allotted 45,739 as vesting of 2021 LTI rights on 11 March 2024, after
deduction of taxation obligations (86,300, pre-tax).
2 Acquired on market during the year
3 As at 8 May 2024, date of retirement.
4 Mr White assumed Chairman role on 8 May 2024
In addition to the interests shown above, indirect interests in Capral shares held by the Managing Director,
Mr. Dragicevich are as follows:
Mr A. M. Dragicevich
Nature of other interests
Balance at 1.1.2024
Balance at 31.12.2024
Balance at date of this report
Performance rights
179,700
140,4001
140,400
1 Nil performance rights lapsed on 1 March 2024; 86,300 performance rights vested on 1 March 2024 and 47,000 performance rights were
issued on 8 May 2024.
Unissued shares or interests under option
At the date of this report, there are 546,500 (2023: 606,000) unissued shares or interests under option.
Refer to sections 1 to 3 of the Remuneration Report and Note 32.
Directors’ Report
23
Capral Limited — Annual Report 2024
24
Capral Limited — Annual Report 2024
Remuneration
Report (Audited)
Section 1: The Remuneration Framework
(a) Key principles
Capral’s remuneration framework and practices are based on
the principles that remuneration is performance driven, aligns
with shareholder interests, provides market competitive
remuneration that attracts qualified and experienced
candidates, and retains and motivates employees.
The variable components of remuneration (short and long
term) are driven by challenging targets focused on both
external and internal measures of financial and non-financial
performance. Details of performances measures are set out
in sections 1(g) and 1(h) below. Executive remuneration is
aligned with shareholder interests via an emphasis on
variable (incentive) remuneration, the award of which is linked
to performance benchmarks that support business strategies
and future success. A significant proportion of executive
remuneration is at-risk. Details of the link between
performance and remuneration is set out in section 4.
(b) Role of Remuneration & Nomination Committee
The Remuneration & Nomination Committee is responsible
for reviewing and making recommendations to the Board of
Directors (the Board) on remuneration policies for Capral
including, in particular, those governing the directors
(including the Managing Director) and executive managers.
The Committee operates in accordance with its Charter.
Remuneration of the Managing Director and certain executive
managers is reviewed at least annually by the Remuneration
& Nomination Committee and recommendations are put to
the Board for its approval. Short- and long-term incentives are
linked to performance criteria. The Board can exercise its
discretion in relation to approving bonuses and incentives.
Changes must be justified by reference to measurable
performance criteria and having regard to Capral’s overall
financial performance and other special circumstances.
The Remuneration & Nomination Committee may seek
independent advice as appropriate in setting the structure
and levels of remuneration based on the principle that the
elements of remuneration should be set at an appropriate
level having regard to market practice for roles of similar
scope and skill.
The remuneration committee engaged Godfrey
Remuneration Group Pty Ltd (GRG) as remuneration
consultant to the board to review the amount and elements
of some key management personnel (non-executive
directors) remuneration and provide recommendations in
relation thereto. GRG was paid $13,000 for the remuneration
recommendations in respect of reviewing the amount and
elements of remuneration.
The engagement of GRG by the remuneration committee
was based on a documented set of protocols that would be
followed by GRG, members of the remuneration committee,
and members of the key management personnel for the way
in which remuneration recommendations would be
developed by GRG and provided to the board. The protocols
included the prohibition of GRG providing advice or
recommendations to key management personnel before the
advice or recommendations were given to members of the
remuneration committee and not unless GRG had approval
to do so from members of the remuneration committee.
These arrangements were implemented to ensure that GRG
would be able to carry out its work, including information
capture and the formation of its recommendations, free
from undue influence by members of the key management
personnel about whom the recommendations may relate.
The board is satisfied that the remuneration
recommendations were made by GRG free from undue
influence by members of the key management personnel
about whom the recommendations may relate.
This report sets out Capral’s remuneration of its directors and executives. It also details the actual
remuneration of its key management personnel (including the directors) during the Financial Year.
25
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
The board undertook its own inquiries and review of the
processes and procedures followed by GRG during the
course of its assignment and is satisfied that its
remuneration recommendations were made free from
undue influence.
These inquiries included arrangements under which GRG
was required to provide the board with a summary of the
way in which it carried out its work, details of its interaction
with key management personnel in relation to the
assignment and other services, and respond to questioning
by members of the board after the completion of the
assignment.
(c) Performance planning and review
Capral has a Performance Planning and Review (PPR)
process to evaluate and discuss performance and
development plans at least annually with salaried
employees. This PPR process covers:
• An agreement of objectives for the year ahead and the
setting of key performance measures against which the
achievement of those objectives will be assessed.
These are set by reference to financial targets and key
business strategies.
• A review of performance against the previously agreed
objectives for the period under review.
• Employee comment and feedback.
• Short- and long-term training and development needs
and career aspirations.
The PPR process ensures that there is better understanding
of Capral's objectives thereby increasing the likelihood of
their achievement. It also enables managers to evaluate and
develop employee skills and performance and identify
future development needs.
(d) Non-executive Directors
The structure of Capral’s non-executive director
remuneration is distinct from that applicable to the
Managing Director and other senior executives.
Remuneration of non-executive directors is established at a
level that enables Capral to attract and retain high quality
directors at a reasonable cost. Remuneration of non-
executive directors and their terms of office are governed by
Capral’s constitution and by contract.
Remuneration of non-executive directors is allocated out of
the pool of funds, the limit of which is approved by
shareholders in general meeting; the fee pool limit is
currently $650,000 per annum, which has not been changed
from last year. Each non-executive director is entitled to the
payment of an annual fee in cash and superannuation
contributions for their services. Additional fees are not paid
for sitting on Board committees; however, the extra
responsibility of the Chairman of the Board and committees
is recognised by the payment of a higher fee. The fees for
the non-executive directors were reviewed by GRG as
detailed above and will be adjusted during FY25 to be in line
to those paid at comparable listed companies. Non-
executive directors do not receive any shares, options or
other securities as part of their remuneration and they are
not eligible to participate in Capral’s equity incentive plans.
There are no schemes for retirement benefits (other than
statutory superannuation payments).
(e) Senior management remuneration
The remuneration policy for the Managing Director and
executives seeks to attract and retain people with the
required capabilities to lead Capral in the achievement of
business objectives and focus on delivering financial and
non-financial measures.
Remuneration is reviewed annually, and approved changes
applied from 1 March.
The Remuneration & Nomination Committee reviews the
remuneration arrangements of the Managing Director, his
direct reports and certain other executive managers. The
Managing Director reviews the remuneration arrangements
of the other members of senior management, based on the
recommendations of his direct reports.
For the Managing Director and other senior management,
remuneration consists of a fixed annual salary and
superannuation (refer to section 1(f) below) plus at-risk
components comprised of a short-term incentive plan
26
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
(STIP) (refer to section 1(g) below) and a long-term
incentive plan (LTIP) (refer to section 1(h) below).
The proportions of fixed and at-risk remuneration are
established for the Managing Director and other senior
management relative to their position in Capral. As a
general guide, at-risk remuneration is 50% for the
Managing Director, 25 – 35% for executive
management and 10%-20% for other senior managers,
for the achievement of ‘target’ goals.
(f) Fixed remuneration
The level of the total employment cost (being base
salary plus superannuation) (TEC) is determined having
regard to job responsibilities, skills, experience, and
performance. Salaries are reviewed annually, with any
changes applied from 1 March. Fixed remuneration of
executives is generally targeted at market median.
The fixed remuneration of the Managing Director is
determined by the Board having regard to other ASX
listed companies in building product related industries,
his particular skills and previous remuneration,
experience and capability to lead Capral in delivering
financial targets and executing key business strategies.
It forms part of his executive employment contract and
is subject to annual review.
The Board has reviewed generally available market
information regarding fixed remuneration of the key
management personnel with comparable revenues and
market capitalisation. The fixed remuneration of
Capral’s key management personnel is generally in line
with this group.
(g) Short term incentives
Capral’s short-term incentive schemes are designed to
encourage participants to assist Capral in achieving
continuous improvement by aligning their interests with
those of Capral and its stakeholders and rewarding
them when key performance measures are achieved.
For the Financial Year, there were 3 short term incentive
programmes:
1) Short Term Incentive Plan (STIP): The Managing
Director and senior employees have the opportunity
to earn a cash and deferred equity incentive, based
on a specified percentage of TEC dependent on
each individual’s level of responsibility. The actual
incentive earned is based on the achievement of
financial and non-financial objectives.
2) Bonus scheme: other salaried employees can earn
fixed payments, as approved by the Managing
Director, for achieving key performance measures
set by their managers and outlined in the
employee’s individual PPR.
3) Sales incentives: Sales employees participate in
quarterly sales incentive programmes in relation to
revenue, gross margin, and debtor days targets.
STIP is weighted 70% to financial objectives and 30%
safety and other non-financial objectives. A summary of
STIP is set out in the table on the following page:
27
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Frequency
Awards determined annually with payment made in the March following the end of the
performance year.
Financial measures
• Trading EBITDA for Capral and (for relevant General/Divisional Managers) Business Units
(30%). Key financial threshold measure as reflects underlying earnings after excluding the
impact of external economic factors such as the volatility of global aluminium prices and
the unrealised impact of foreign exchange rate fluctuations.
• Net Profit After Tax for Capral (15%). Aligned to ability to pay dividends.
• Free Cash Flow for Capral (15%). Selected to ensure effectiveness of cash management.
• % Working Capital to Annualised Sales for Capral and (for relevant General/ Divisional
Managers) Business Units (10%). Selected to ensure effectiveness of capital
management.
Safety and other
non-financial measures
Specific individual objectives are set to reflect measurable and numeric (where possible)
strategic initiatives and profit and safety improvement objectives. The key individual
objectives include performance to customers, sales targets/growth, productivity and
operational improvements, key projects, and cost improvements. The weightings are
generally 5% however may be higher or lower depending on importance to company
performance.
Assessment of
performance against
measures
Performance against financial measures is assessed after the end of each financial year
based on Capral’s financial results. The performance against non-financial measures is
assessed as part of the PPR process.
The Managing Director, in consultation with senior managers, is responsible for
recommending to the Board the amount of STIP, if any, to be paid.
Payments are subject to the achievement of applicable Capral, Divisional or Regional
minimum annual Trading EBITDA targets. Stretch payments are not made where target
financial metrics are not met.
Discretionary override
The Board retains absolute discretion regarding payments having regard to Capral’s overall
financial position and other special circumstances that have arisen during the year (ie
normalisation or clawback). The intent however is to minimise the exercise of discretionary
adjustments to the planned outcomes set at the start of the year. Material adjustments
would be disclosed.
Service condition
The Managing Director is eligible to receive a pro-rata payment where his employment is
terminated other than for cause. Payments to other employees who leave Capral part way
through a performance period is subject to Board discretion.
Clawback of awards
In the event of fraud, misstatement or misrepresentation of the financials, the Board may
exercise its discretion to withhold some or all of a payment before it is made or recover
some or all of payments already made.
Deferral
Any ‘Stretch’ STIP payments (after tax) to the Managing Director and Executive Team is
satisfied by Capral Shares and held in escrow for 3 years. These shares can be issued or
acquired on-market (priced at the 12-month Volume Weighted Average Price (VWAP) as at
the end of the performance period) as determined by the Board. There is no deferred cash/
equity component for other STIP participants. The Board introduced deferred equity in 2018
to further strengthen alignment of Capral’s executive managers with shareholders.
Plan review
The STIP design is reviewed at least annually by the Remuneration & Nomination Committee
and approved by the Board. The Managing Director, in consultation with senior managers, is
responsible for recommending to the Board the STIP financial targets. The non-financial
objectives are approved by the Managing Director. The Managing Director’s non-financial
targets are established and approved by the Board.
28
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
The Managing Director and key management personnel are
eligible for the following awards of STIP relative to TEC:
Position
% of TEC
Minimum
Target
Stretch
Managing Director
25%
50%
100%
Chief Financial Officer
17.5%
35%
70%
Where objectives can be financially measured, ‘Minimum’ is
generally set around 15% below Board approved Budget.
‘Target’ is generally set around Board approved Budget and
‘Stretch’ is generally set 30% above Budget.
The Board periodically review external independent
remuneration benchmarking reports (latest FY 2021)
regarding short term incentive schemes of the key
management personnel (including the Managing Director)
for listed companies with comparable revenues and market
capitalisation. The Board considers that Capral’s short-term
incentive scheme is generally in line with this group.
(h) Long term incentives
Capral’s long-term incentive plan (LTIP) was designed to
strengthen the alignment of the interests of senior
managers with shareholders and support a culture of share
ownership and shareholder wealth. It also aims to provide
competitive remuneration for the retention of specifically
targeted members of senior management.
The Managing Director, Mr Dragicevich, was granted 49,000
performance rights following shareholder approval in April
2022 and 44,400 performance rights following shareholder
approval in April 2023. During the Financial Year, an
additional 47,000 performance rights were granted to Mr
Dragicevich following shareholder approval in May 2024.
On the recommendation of the Managing Director to the
Remuneration & Nomination Committee, selected senior
executives participate in LTIP.
A summary of LTIP for the Managing Director and other
senior executives is set out on the following page.
29
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Frequency
Awards determined annually.
Type of award
Performance rights subject to service requirements and vesting criteria. If the conditions are
met, shares will be issued or allocated around the vesting date.
Amount of award
The Managing Director is eligible to receive additional annual issues of up to 50% of the value
of TEC, subject to shareholder approval.
The value of individual awards for all other participating senior executives is generally less than
35% of TEC.
As a matter of practice, the aggregate amount of each annual award to all Executives is less
than 1.5% of issued capital and the number of rights awarded is based on the 12-month
Volume Weighted Average Price (VWAP) as at the start of the performance period.
Performance period &
vesting dates
3 years with 31 December testing dates:
• 2021 award: vesting date of 1 March 2024.
• 2022 award: vesting date of 1 March 2025.
• 2023 award: vesting date of 1 March 2026.
• 2024 award: vesting date of 1 March 2027.
Performance conditions
Performance rights granted under LTIP are subject to the participant remaining employed by
Capral at the vesting date and the achievement of the following performance conditions:
• 50% of rights are subject to an EPS performance condition. The actual EPS performance is
measured over a 3-year period, must meet, in aggregate, the 3 annual targets combined.
The EPS condition is calculated each year as follows: Net Profit After Tax Target (set at least
at minimum Budget level) as specified by the Board for that year (adjusted for any
extraordinary items approved by the Board) divided by weighted average number of
securities on issue during the year. The Board may adjust EPS to normalise results and
exclude the effects of material business acquisitions/ divestments and certain one-off
costs; any material adjustments would be disclosed. The number of rights that may vest is
set out in Table B on the following page.
• 50% of rights are subject to a TSR performance condition as against the entities with
ordinary shares and units (as the case may be) included in the S&P/ASX All Ordinaries Index
as at 1 January in the year of grant but excluding those companies who are classified in the
Global Industry Classification Standard sector number 40. The number of rights which may
vest is set out in Table A on the following page.
Assessment of
performance against
measures
Performance against the EPS and TSR conditions are assessed at the end of the 3-year period
(31 December testing date).
There is no re-testing of EPS or TSR conditions. Vested rights convert on the relevant vesting
date a one-for-one basis to ordinary shares. Unvested rights lapse.
Treatment of awards on
cessation of employment
If employment ceases all unvested rights will immediately lapse. However, if the cessation
relates to the redundancy or permanent disability / death of the employee or other reason
determined by the Board then the Board has absolute discretion to determine that the rights
remain in play on a pro rata basis.
Treatment of awards on
change of control
The Board has discretion to allow awards to vest on a change of control. In exercising this
discretion, the Board is not bound to award all shares.
Dividend/participation
rights
There is no entitlement to dividends on performance rights during the vesting period or to
participate in respect of issues of shares to shareholders.
Clawback of awards
In the event of fraud, misstatement or misrepresentation of the financials, the Board may
exercise its discretion to forfeit some or all of the award prior to the issue of shares or recover
some or all of the award already made.
Plan review
The LTIP design is reviewed at least annually by the Remuneration & Nomination Committee
and approved by the Board. The Managing Director makes recommendations to the
Remuneration & Nomination Committee regarding the proposed LTIP award participants and
the amount of the entitlements.
30
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Vesting of rights subject to the TSR and EPS performance
conditions at each testing date is determined in accordance
with Tables A and B respectively below:
Table A
Percentile of TSR
% Rights vesting
< 50th
None
50th
50
> 50th and < 75th
Between 50 and 100 (pro rata)
> 75th
100
Table B
EPS target
% Rights vesting
> 5% below target
None
5% below target
50
< 5% below target to
10% above target
Between 50 and 100 (pro rata)
> 10% above target
100
The Board considers that Capral’s long-term incentive
scheme is generally in line with other listed companies with
comparable revenues and market capitalisation.
(i) Anti-hedging policy
Capral’s personnel are not permitted to enter into
transactions with securities (or any derivative thereof)
which limit the economic risk of any unvested entitlements
awarded under any Capral equity-based remuneration
scheme currently in operation or which will be offered by
Capral in the future. As part of Capral’s due diligence
undertaken at the time of the financial results, participants
in any Capral equity plan are required to confirm that they
have not entered into any such prohibited transactions.
Section 2: Actual Remuneration of Key
Management Personnel
During the Financial Year there were a number of
remuneration outcomes. The expensed remuneration is set
out in detail in the remuneration table below however in
summary the key outcomes were as follows:
(a) Remuneration
General pay increases were implemented for executives.
Total expensed remuneration for these executives (including
the directors) increased on average by 3% as compared to
the prior year.
(b) STIP
STIP accruals in respect of the 2024 year are higher than
the prior year actual payout.
(c) LTIP
47,000 performance rights were granted to the Managing
Director in May 2024 following shareholder approval (2023:
44,400) and 153,000 rights were granted under the 2023
LTIP award to executives in March 2024 (2023: 141,100).
Performance rights granted to the Managing Director and
executives under LTIP awards were tested after the year end
with the outcomes detailed in section 3 below.
For the Financial Year ending 31 December 2025, Capral
intends to:
• increase the fixed remuneration of the Managing Director
and executives by an average of 3%; and
• grant further performance rights under the LTIP to the
Managing Director (subject to shareholder approval) and
selected senior managers.
31
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
(d) Remuneration table - key management personnel
The following table sets out the remuneration of the key management personnel (including the
directors) during the Financial Year and the 2023 financial year.
The key management personnel of the consolidated entity are the non-executive directors, Managing
Director and Chief Financial Officer/Company Secretary. These people have the authority and
responsibility for planning, directing and controlling the day-to-day activities of Capral.
Short-term employee benefits
Name
Year
Title
Salary and fees1
Bonus1
Non-monetary
benefits
$
$
$
Directors
A.M. Dragicevich
2024
Managing Director
735,875
384,950
-
2023
Managing Director
702,310
373,750
-
R.L. Wood-Ward
2024
Chairman5
44,494
-
-
2023
Chairman
124,545
-
-
K. Ostin
2024
Non-executive director
85,731
-
-
2023
Non-executive director
83,636
-
-
G.F. Pettigrew
2024
Non-executive director
-
-
-
2023
Non-executive director
26,653
-
-
M. White
2024
Non-executive director/Chairman
109,478
-
-
2023
Non-executive director
73,636
-
-
B. Tisher
2024
Non-executive director
85,731
-
-
2023
Non-executive director
83,217
-
-
Executives
T. Campbell *
2024
CFO/ Co. Sec.
453,895
169,750
-
2023
CFO/Co. Sec.
430,832
139,500
-
Total 2024
1,515,204
554,700
-
Total 2023
1,524,829
513,250
-
1 All salaries, fees and bonus amounts are on an accrual basis. Bonuses relating to a financial year are payable in the following financial year.
2 Termination benefits include leave accrued and payments made in lieu of notice at the end of employment with Capral.
3 All LTIP performance rights listed are securities that have not yet vested. In relation to the performance rights of the key management
personnel refer to Note 32 of the consolidated financial statements.
4 Superannuation guarantee percentage has been changed from 11% to 11.5% from 1 July 2024.
5 Mr Wood-Ward retired as director on 8 May 2024, and stayed on as consultant until 1 September 2024. During this period as consultant, Mr
Wood-Ward was not a key management personnel and received a salary of $25,338 and superannuation of $2,853.
6 Mr Tisher’s superannuation was paid as part of his normal salary due to reaching the concessional contributions cap.
* Capral’s key management personnel (other than directors).
32
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Post-employment
benefits
Other
long-term
benefits
Termination
benefits2
Share-based
payments
Total
Total
performance
related
Superannuation4
Deferred
Equity1
Performance
Rights3
$
$
$
$
$
$
%
27,500
-
-
62,350
304,094
1,514,769
50
27,500
-
-
88,450
351,756
1,543,766
53
4,894
-
-
-
-
49,388
-
13,392
-
-
-
-
137,937
-
9,647
-
-
-
-
95,378
-
8,993
-
-
-
-
92,629
-
-
-
-
-
-
-
-
2,799
-
-
-
-
29,452
-
12,366
-
-
-
-
121,844
-
7,917
-
-
-
-
81,553
-
9,6476
-
-
-
-
95,378
-
8,950
-
-
-
-
92,167
-
27,482
-
-
27,550
108,602
787,279
39
27,482
-
-
31,900
103,626
733,340
38
91,536
-
-
89,900
412,696
2,664,036
97,033
-
-
120,350
455,382
2,710,844
33
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Performance rights - Managing Director
During the Financial Year and the financial year ended 31
December 2023, performance rights were granted as equity
compensation benefits under the LTIP, to the Managing
Director as disclosed as at balance date below. The
performance rights were granted at no cost to him.
47,000 performance rights were granted to the Managing
Director in May 2024 following shareholder approval.
These rights have a vesting date of March 2027.
44,400 performance rights were granted to the Managing
Director in April 2023 following shareholder approval. These
rights have a vesting date of March 2026.
49,000 performance rights were granted to the Managing
Director in April 2022 following shareholder approval.
These rights have a vesting date of March 2025.
The EPS condition (relating to 24,500 rights granted in
2022) was tested as at 31 December 2024. Capral achieved
the EPS condition and consequently 24,500 rights will vest
in March 2025. The TSR condition (relating to 24,500 rights
granted in 2022) was also tested as at 31 December 2024.
Capral’s relative TSR performance over the period from
January 2022 to December 2024 at 45.9% (2023: 121.4%)
was in the 81st percentile (2023: 91st) and thus 100% of the
rights subject to the TSR condition will vest in March 2025.
Consequently, a total of 49,000 rights will vest and convert
into Capral shares on a 1 for 1 basis as at 1 March 2025.
86,300 performance rights were granted to the Managing
Director in April 2021 following shareholder approval. None
of 86,300 rights lapsed and a total of 86,300 rights vested
and converted into Capral shares on a 1 for 1 basis,
as at 1 March 2024.
Tranche
Grant No.
Grant date
Fair value
per right at
grant date ($)
Test date
Lapsed
No.
Vested
No.
Active No
2024 Offer
A. Dragicevich
05/08/2024
EPS 50%
23,500
$7.95
31/12/2026
-
-
23,500
TSR 50%
23,500
$5.43
31/12/2026
-
-
23,500
Total 2024 Offer
47,000
-
-
47,000
2023 Offer
A. Dragicevich
27/04/2023
EPS 50%
22,200
$5.94
31/12/2025
-
-
22,200
TSR 50%
22,200
$4.25
31/12/2025
-
-
22,200
Total 2023 Offer
44,400
-
-
44,400
2022 Offer
A. Dragicevich
27/04/2022
EPS 50%
24,500
$7.77
31/12/2024
-
-
24,500
TSR 50%
24,500
$5.82
31/12/2024
-
-
24,500
Total 2022 Offer
49,000
-
-
49,000
2021 Offer
A. Dragicevich
28/04/2021
EPS 50%
43,150
$6.43
31/12/2023
-
43,150
TSR 50%
43,150
$5.17
31/12/2023
-
43,150
Total 2021 Offer
86,300
-
86,300
Nil
Total Active Rights
140,400
Section 3: Performance Rights, Options and Bonuses provided as Compensation
34
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
During the Financial Year and the financial year ended 31
December 2023, performance rights were granted as equity
compensation benefits under the LTIP, to certain executives
including key management personnel as disclosed as at
balance date below. The performance rights were granted
at no cost to the participants.
153,000 performance rights were granted under the 2024
LTIP award to executives in March 2024. These rights have
a vesting date of March 2027.
141,100 performance rights were granted under the 2023
LTIP award to executives in March 2023. 4,500 of these
performance rights have been forfeited due to resignation
of executives in the normal course of business. These rights
have a vesting date of March 2026.
139,000 performance rights were granted under the 2022
LTIP award to executives in March 2022. These rights have
a vesting date of March 2025. 22,500 of these performance
rights have been forfeited due to resignation of executives in
the normal course of business. The EPS condition (58,250
rights) was tested as at 31 December 2024. Capral achieved
the EPS condition and consequently 58,250 of these rights
will vest in March 2025. The TSR condition (58,250 rights)
was also tested as at 31 December 2024. Capral’s relative
TSR performance over the period from January 2022 to
December 2024 at 45.9% (2023: 121.4%) was in the 81st
percentile (2021: 91st) and thus 100% of the rights subject to
the TSR condition will vest in March 2025. Consequently, a
total of 116,500 rights will vest and convert into Capral
shares on a 1 for 1 basis as at 1 March 2025.
164,700 performance rights were granted under the 2021
LTIP award to executives in March 2021. 9,000 of these
performance rights have been forfeited. None of 155,700
rights lapsed and a total of 155,700 rights vested and
converted into Capral shares on a 1 for 1 basis,
as at 1 March 2024.
Other KMP/Offer
Tranche
Grant No.
Grant date
Fair value
per right at
grant date ($)
Test date
Lapsed
No.
Vested
No.
Active No
2024 Offer
T. Campbell
20,500
11/03/2024
-
-
20,500
EPS 50%
10,250
$7.78
31/12/2026
-
-
10,250
TSR 50%
10,250
$5.36
31/12/2026
-
-
10,250
Total 2024
20,500
-
-
20,500
2023 Offer
T. Campbell
16,600
06/03/2023
-
-
16,600
EPS 50%
8,300
$6.16
31/12/2025
-
-
8,300
TSR 50%
8,300
$4.73
31/12/2025
-
-
8,300
Total 2023
16,600
-
-
16,600
2022 Offer
T. Campbell
17,500
08/03/2022
-
-
17,500
EPS 50%
8,750
$6.78
31/12/2024
-
-
8,750
TSR 50%
8,750
$4.91
31/12/2024
-
-
8,750
Total 2022
17,500
-
-
17,500
2021 Offer
T. Campbell
25,700
03/03/2021
-
25,700
EPS 50%
12,850
$5.49
31/12/2023
-
12,850
TSR 50%
12,850
$4.18
31/12/2023
-
12,850
Total 2021
25,700
-
25,700
Total Active Rights
54,600
Performance rights – other key management personnel and executives
35
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Options
No options were issued under the LTIP during the Financial Year and the financial year ended 31 December 2023.
Equity grants during the Financial Year
Details of the performance rights granted, as well as the movement during the Financial Year in rights previously granted, to
key management personnel are as follows:
2024 Performance
share rights
Held at start
of year
Granted as
compensation
Lapsed
Vested
Other
Changes
Held at end
of year
Maximum
value yet to
vest ($)
A Dragicevich
179,700
47,000
-
(86,300)
-
140,400
383,688
T Campbell
59,800
20,500
-
(25,700)
-
54,600
139,551
239,500
67,500
-
(112,000)
-
195,000
523,239
The non-executive directors hold no performance rights.
Bonuses
During the Financial Year and the financial year ended 31 December 2023, STIP bonus payments were made to the Managing
Director and key management personnel. The Managing Director’s STIP payments for 2024 and 2023 equated to 59% and
53% (respectively) of his TEC (above the Capral Trading EBITDA2 ‘target’ level detailed in section 1 above) and the Board
considers it appropriate having regard to the achievement of certain key financial measures as well as critical non-financial
measures regarding customers, capital projects, anti-dumping activities and other strategic plans. The other key
management personnel’s STIP payments were 41% and 38% of TEC for 2024 and 2023 respectively (above the Capral Trading
EBITDA2 ‘target’ level detailed in section 1 above).
The percentages of bonus accrued and forfeited (as a result of not meeting the performance criteria at ‘target’ level) during
the Financial Year and the financial year ended 31 December 2023 are disclosed below:
2024
% of bonus accrued
% of bonus forfeited
% of compensation for the year
consisting of STIP bonus1
Executives
A. Dragicevich
117
-
37
T. Campbell
117
-
29
2023
Executives
A. Dragicevich
124
-
39
T. Campbell
123
-
27
Note:
1 Total compensation used for calculating % purposes excludes equity compensation benefits under the LTIP and termination benefits.
2 Trading EBITDA (non-IFRS measure) is EBITDA adjusted for items assessed as unrelated to the underlying performance of the business and
allows for a more relevant comparison between financial periods.
36
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Shareholdings of key management personnel - fully paid ordinary shares of the Company
Details of the holdings of Capral’s ordinary shares of key management personnel during the Financial Year are as follows:
2024
Held at
start of year
Granted as
compensation
Received on vesting of
performance rights/
exercise of options
Other changes
during the year3
Held at
end of year
Directors
R.L. Wood-Ward
-
-
-
-
-
A.M. Dragicevich
566,794
5,7241
45,7392
618,2574
K. Ostin
-
-
-
-
-
B. Tisher
-
-
-
4,500
4,500
M. White
-
-
-
1,047
1,047
Executives
T. Campbell
71,560
2,0641
25,7002
(9,340)
89,9845
638,354
7,788
71,439
(3,793)
713,788
1 Deferred equity acquisition as part of 2023 STIP plan.
2 Acquired on vesting of performance rights in March 2024, after deduction of taxation obligations (86,300, pre-tax).
3 Acquired / (disposed) through on-market buy/sell transactions.
4 32,744 shares held are in escrow at the end of Financial Year.
5 9,984 shares held are in escrow at the end of Financial Year.
37
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Section 4: Relationship between Remuneration and Company Performance
There is a link between company performance and executive reward. For the Financial Year and the previous 4 financial
years, Capral has made STIP payments based upon the achievement of performance (financial and non-financial) measures.
Whilst continuing to ensure that Capral attracts and retains qualified, experienced, and motivated employees in accordance
with the remuneration policy by remunerating employees at a competitive level, Capral has placed more emphasis on at-risk
remuneration in order to align remuneration of the employees to the performance of Capral and encourage shareholder
wealth.
During the Financial Year and the previous 4 financial years (2020-2023), Capral's financial performance objectives were as
follows, with the minimum targets (M) that were set for the 2023 STIP financial measures also shown:
Year Ended 31 Dec
2024 (A)
2024 (M)
2023 (A)
2022 (A)
2021 (A)
2020 (A)
Trading EBITDA $’0001
36,944
29,900
42,299
43,305
38,157
19,668
Free Cash Flow $’0001
28,633
23,000
52,431
(16,376)
17,229
20,7525
Net Profit $’000
29,0642
22,500
31,839
32,3873
33,3134
11,4645
% Working Capital to Annualised
Sales
14.2
15.5
15.8
13.1
10.7
13.2
Underlying earnings - cents per share
168.132
130.15
177.48
183.503
196.474
69.515
Dividends Declared $000
6,813
9,700
12,437
12,016
7,467
Buy Back (cancelled) $000
6,219
3,145
-
-
-
Share Price (VWAP) cps
928
819
842
744
414
Share Price Change
13.3%
(2.7%)
13.2%
79.7%
23.2%
Note:
Any JobKeeper related benefit received in 2020 have been excluded in full
1 Trading EBITDA (non-IFRS measure as explained in footnote to Chairman’s Report on Page 2) is Statutory EBITDA adjusted for items
assessed as unrelated to the underlying performance of the business and allows for a more relevant comparison between financial periods.
Free Cash Flow is Net cash provided by operating activities reduced by net cash flows used in investing activities and lease liability
payments.
2 Net Profit and Earnings per share adjusted to exclude Deferred Tax Benefit of $3.610 million.
3 Net Profit and Earnings per share adjusted to exclude Deferred Tax Benefit of $8.365 million.
4 Net Profit and Earnings per share adjusted to exclude Deferred Tax Benefit of $9.430 million, property revaluation $3.074 million.
5 Free Cash Flow, Net Profit and Basic Earnings per share adjusted to exclude Deferred Tax Benefit of $3.048 million and other
one-off items of $0.499 million.
In the Financial Year, Capral’s Trading EBITDA and Net Profit after tax (excluding Income Tax Benefit) was lower than 2023.
The minimum targets were surpassed in all instances. As a result, proportional STIP will be payable to Capral key
management and other senior personnel. Discretionary Bonuses will also be payable to other qualifying employees. At a
Divisional and Regional level minimum Trading EBITDA measures were achieved in all business units, and there were mixed
results relating to Working Capital and sales volume measures.
38
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Section 4: Relationship between Remuneration and Company Performance (cont’d)
The following provides examples of other key measures (that are not commercially sensitive) used to
assess executive performance:
Performance Area
Measure
Outcome
Safety
Reduction in total reportable injury
frequency rate
Minimum target was not achieved.
Hours lost & return to work hours
lost from injuries
Rate improved significantly and Group stretch targets were
almost met.
Customers
Volume retention/ growth
Sales areas met some of the specific growth and revenue
targets as well as margin measures. Performance varied by
region/division.
Production
Operational efficiency
Manufacturing plants met some of their operational
efficiency/improvement targets. Performance varied by plant.
Supply Chain
Supply chain and inventory
reduction programmes
Initiatives were generally achieved.
People
AL & LSL excess balance reduction
Overall excess leave balance reduction initiatives were
achieved. Performance varied by region/division.
Anti-dumping
Pursue anti-dumping campaign
Overall, the outcomes were successful.
Costs
Cost reduction initiatives
Many of the specific cost and expense reduction initiatives
were achieved. Performance varied by region/division.
STIP accruals in respect of the 2024 year are higher than the prior year actual payout, aligned to financial performance.
There is a clear link between financial performance and the level of STIP awarded.
LTIP is linked to Capral’s performance as the value of the performance rights awarded depends on Capral’s share price and
dividend payments, and whether the awards vest relate to earnings growth and Capral’s relative TSR performance. There
is a link between Capral’s performance and the vesting of rights under LTIP awards. In this regard:
In 2024:
• Capral’s relative TSR performance over the period from
January 2022 to December 2024 achieved the 81st
percentile, above the maximum 75th percentile.
Consequently, 100% or 82,750 of the rights subject to the
TSR condition that were awarded in 2022 to executives
will vest and convert to Capral shares.
• Given earnings in, 2022, 2023 and 2024, the aggregate
EPS result for the 3-year period to 2024 was 529.10 cents
per share against an aggregate target of 423.02 cents
per share and therefore the EPS condition of the 2022
award was achieved. Consequently, 100% or 82,750 of
the rights subject to the EPS condition of the 2022 award
will vest and convert into Capral shares.
In 2023:
• Capral’s relative TSR performance over the period from
January 2021 to December 2023 achieved the 91st
percentile, above the maximum 75th percentile.
Consequently, 100% or 123,000 of the rights subject to
the TSR condition that were awarded in 2021 to
executives will vest and convert to Capral shares.
• Given earnings in, 2021, 2022 and 2023, the aggregate
EPS result for the 3-year period to 2023 was 557.4 cents
per share against an aggregate target of 362.4 cents per
share and therefore the EPS condition of the 2021 award
was achieved. Consequently, 100% or 123,000 of the
rights subject to the EPS condition of the 2021 award will
vest and convert into Capral shares.
39
Capral Limited — Annual Report 2024
Remuneration Report (Audited)
Section 5: Summary of Key Employment Contracts
Details of the key contract terms for the Managing Director and other key management personnel as at the end of the
Financial Year are as follows:
Contract Details
A. Dragicevich
T. Campbell
Expiry date
No fixed end date
No fixed end date
Notice of termination by Capral
6 months
6 months
Notice of termination by employee
6 months
6 months
Termination payments
(in lieu of notice)
6 months salary plus accrued but
unpaid STIP (pro rata for incomplete
financial year).
In addition, on retirement or if
employment is terminated by Capral
other than for cause, unvested LTIP
rights may remain in play on a
pro rata basis.
6 weeks annual leave per annum.
6 months salary. STIP entitlement for
incomplete financial years is subject to
Board discretion.
In addition, on retirement or if
employment is terminated by Capral
other than for cause, unvested LTIP
rights may remain in play on a
pro rata basis.
40
Capral Limited — Annual Report 2024
Environmental regulations
Manufacturing licences and consents required by laws and
regulations are held by the consolidated entity at each
relevant site as advised by consulting with relevant
environmental authorities. All applications for and renewals
of licences have been granted and all consents have been
given by all relevant authorities.
Directors' and officers'
indemnities and insurance
Under Capral's constitution, Capral is required to indemnify,
to the extent permitted by law, each director and secretary
of Capral against any liability incurred by that person as an
officer of Capral. The directors listed on page 5 and the
secretary listed on page 12 have the benefit of this
indemnity. During the Financial Year, Capral paid a
premium for directors’ and officers’ liability insurance
policies which cover current and former directors,
company secretaries and officers of the consolidated
entity. Details of the nature of the liabilities covered and the
amount of the premium paid in respect of the directors'
and officers' insurance policies are not disclosed, as such
disclosure is prohibited under the terms of the contracts.
Indemnities to auditors
In respect of non-audit services provided in relation to tax
consulting and tax compliance advice during the Financial
Year, KPMG, Capral's auditor, has the benefit of an
indemnity (including in respect of legal costs) for any third
party claim in connection with the use, distribution or
reliance on their work (except to the extent caused by the
wilful misconduct or fraud of KPMG, or where it has agreed
that the third party may rely on the work or it may be used
in a public document).
Proceedings on behalf of Capral
No person has applied to the Court under section 237 of
the Corporations Act for leave to bring proceedings on
behalf of Capral, or to intervene in any proceedings to
which Capral is party, for the purpose of taking
responsibility on behalf of Capral for all or part of those
proceedings. No proceedings have been brought or
intervened in on behalf of Capral with leave of the Court
under section 237 of the Corporations Act.
Non-audit services
Capral may decide to employ the auditor on assignments
additional to their statutory audit services where the
auditor's expertise and experience with the consolidated
entity are important.
The Board has considered this position and in accordance
with the advice received from the Audit & Risk Committee, it
is satisfied that the provision of these services during the
Financial Year by the auditor is compatible with, and did not
compromise, the general standard of auditor independence
imposed by the Corporations Act for the following reasons:
1) the non-audit services provided do not involve
reviewing or auditing the auditor’s own work and have
not involved partners or staff acting in a management
or decision-making capacity for Capral or in the
processing or originating of transactions;
2) all non-audit services and the related fees have been
reviewed by the Audit & Risk Committee to ensure
complete transparency and that they do not affect the
integrity and objectivity of KPMG; and
3) the declaration required by section 307C of the
Corporations Act 2001 confirming independence has
been received from KPMG.
Details of the amounts paid or payable to Capral's auditor
(KPMG) for audit and non-audit services provided during
the Financial Year are set out in Note 28 of the consolidated
financial statements.
Auditor's independence declaration
The auditors' independence declaration as required under
section 307C of the Corporations Act is set out on page 42.
Rounding of amounts
Capral is a company of the kind referred to in ASIC
Corporations Instrument 2016/191, and in accordance with
that ASIC Corporations Instrument amounts in the
Directors' Report and the Financial Report are rounded off
to the nearest thousand dollars, unless otherwise indicated.
Signed in accordance with a resolution of directors made
pursuant to section 298(2) of the Corporations Act 2001.
On behalf of the directors
Tony Dragicevich
Managing Director
Mark White
Chairman
Sydney
26 February 2025
Directors’ Report
41
Capral Limited — Annual Report 2024
Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001
To the Directors of Capral Limited
I declare that, to the best of my knowledge and belief, in relation to the audit of Capral Limited for the
financial year ended 31 December 2024 there have been:
i.
no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and
ii.
no contraventions of any applicable code of professional conduct in relation to the audit.
KPM_INI_01
KPMG
Daniel Camilleri
Partner
Sydney
26 February 2025
Auditor’s Independence Declaration
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated
with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and
logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by
a scheme approved under Professional Standards Legislation.
42
Capral Limited — Annual Report 2024
Consolidated Statement of Profit or Loss
and Other Comprehensive Income
for the financial year ended 31 December 2024
2024
2023
Continuing operations
Note
$’000
$’000
Sales revenue
604,398
614,844
Scrap and other revenue
45,300
42,015
Revenue
3
649,698
656,859
Other income
3
5,412
4,333
Raw materials and consumables used
(410,397)
(423,216)
Employee benefits expense
2
(115,529)
(109,066)
Depreciation and amortisation expense
2
(23,831)
(23,009)
Finance costs
2
(5,572)
(6,682)
Freight expense
(14,901)
(17,065)
Occupancy costs
2
(5,491)
(5,966)
Repairs and maintenance expense
(9,231)
(7,894)
Other expenses
2
(41,281)
(36,455)
Profit before tax
28,877
31,839
Income tax benefit
4
3,610
-
Profit for the year
32,487
31,839
Total comprehensive income for the year
32,487
31,839
Earnings per share
($ per share)
($ per share)
Basic earnings per share
22
1.88
1.77
Diluted earnings per share
22
1.82
1.71
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction
with the accompanying notes.
43
Capral Limited — Annual Report 2024
Consolidated Statement of Financial Position
as at 31 December 2024
2024
2023
Note
$’000
$’000
ASSETS
Current assets
Cash and cash equivalents
6
68,907
59,457
Trade and other receivables
7
91,827
89,313
Inventories
8
155,397
126,150
Other financial assets
26 (c)
2,596
11
Prepayments
2,039
2,711
Total current assets
320,766
277,642
Non-current assets
Deferred tax assets
9
27,310
23,700
Property, plant and equipment
11
59,040
57,518
Right-of-use assets
14
59,022
62,710
Other intangible assets
12
1,579
560
Goodwill
13
4,699
3,070
Total non-current assets
151,650
147,558
Total assets
472,416
425,200
LIABILITIES
Current liabilities
Trade and other payables
16
141,367
106,973
Lease liabilities
17
16,928
15,558
Provisions
18
14,813
14,920
Other financial liabilities
26 (c)
-
2,016
Deferred income
222
162
Total current liabilities
173,330
139,629
Non-current liabilities
Lease liabilities
17
66,000
73,255
Provisions
18
7,957
7,584
Total non-current liabilities
73,957
80,839
Total liabilities
247,287
220,468
Net assets
225,129
204,732
EQUITY
Issued capital
19
409,124
424,771
Reserves
20
147,381
114,947
Accumulated losses
20 (b)
(331,376)
(334,986)
Total equity
225,129
204,732
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
44
Capral Limited — Annual Report 2024
Consolidated Statement of Cash Flows
for the financial year ended 31 December 2024
2024
2023
Note
$’000
$’000
Cash flows from operating activities
Receipts from customers
716,230
728,436
Payments to suppliers and employees
(656,714)
(646,970)
59,516
81,466
Interest and other costs of finance paid
(6,812)
(6,425)
Net cash provided by operating activities
30(i)
52,704
75,041
Cash flows from investing activities
Payments for property, plant and equipment
(9,693)
(8,684)
Payments for intangible assets
-
(86)
Net cash outflow on acquisition of business
(6,812)
-
Interest received
1,705
805
Net cash flows used in investing activities
(14,800)
(7,965)
Cash flows from financing activities
Payments of dividends
21
(6,090)
(12,494)
Payments for on-market share buy-back
(6,219)
(3,145)
Payments for share purchase – employee share plan
20
(355)
(2,332)
Proceeds in relation to employee share scheme
104
92
Proceeds from borrowings (Trade loans)
-
36,563
Repayment of borrowings (Trade loans)
-
(60,646)
Repayment of principal of lease liabilities
30(iii)
(16,458)
(15,817)
Net cash flows used in financing activities
(29,018)
(57,779)
Net increase in cash and cash equivalents
8,886
9,297
Cash and cash equivalents at the beginning
of the financial year
59,457
48,988
Effect of foreign exchange rate changes
564
1,172
Cash and cash equivalents at the end of the financial year
6
68,907
59,457
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
45
Capral Limited — Annual Report 2024
Consolidated Statement of Changes in Equity
for the year ended 31 December 2024
Note
Fully paid
ordinary shares
Equity-settled
compensation
reserve
Employee
share reserve
$'000
$'000
$'000
Balance as at 1 January 2023
433,433
12,891
(38)
Profit for the year
-
-
-
Total comprehensive profit for the year
-
-
-
Share-based payments expense
-
1,045
-
Shares cancelled – on-market buy-back
19, 20
(8,705)
-
-
Shares issued - employee escrow shares
43
-
-
Employees shares on-market purchase
20
-
-
(1,970)
Employees shares off-market purchase
20
-
-
(312)
Dividends paid
20, 21
-
-
-
Balance as at 31 December 2023
424,771
13,936
(2,320)
Balance as at 1 January 2024
424,771
13,936
(2,320)
Profit for the year
-
-
-
Total comprehensive profit for the year
-
-
-
Share-based payments expense
-
1,095
-
Shares cancelled – on-market buy-back
19, 20
(15,647)
-
-
Employees shares on-market purchase
20
-
-
(355)
Vested performance rights conversion to shares
20
-
(1,988)
1,362
Proceeds from employee escrows shares
20
-
-
104
Dividends paid
20, 21
-
-
-
Balance as at 31 December 2024
409,124
13,043
(1,209)#
* Dividend reserve represents undistributed profits since the financial year 2010. Current period profit has been transferred to a
dividend reserve account. Interim and final dividends are declared and sourced from current year profits.
^ Income tax benefit (2024: $3.16 million; 2023: $nil) in relation to deferred tax assets on tax losses and temporary differences are
excluded from dividend reserve.
# This relates to 132,853 uncancelled and unallocated Capral shares (refer to Note 19).
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
46
Capral Limited — Annual Report 2024
Asset revaluation reserve
Dividend reserve*
Share buy-back reserve
Accumulated losses
Total
$'000
$'000
$'000
$'000
$'000
4,088
74,338
-
(334,986)
189,726
-
31,839
-
-^
31,839
-
31,839
-
-^
31,839
-
-
-
-
1,045
-
-
5,560
-
(3,145)
-
-
-
-
43
-
-
-
-
(1,970)
-
-
-
-
(312)
-
(12,494)
-
-
(12,494)
4,088
93,683
5,560
(334,986)
204,732
4,088
93,683
5,560
(334,986)
204,732
-
28,877
-
3,610^
32,487
-
28,877
-
3,610^
32,487
-
-
-
-
1,095
-
-
9,429
-
(6,218)
-
-
-
-
(355)
-
-
-
-
(626)
-
-
-
-
104
-
(6,090)
-
-
(6,090)
4,088
116,470
14,989
(331,376)
225,129
Consolidated Statement of Changes in Equity
47
Capral Limited — Annual Report 2024
Notes to the Consolidated
Financial Statements
for the financial year ended 31 December 2024
1a. Reporting entity
Capral Limited (the Company or Capral) is a public listed
company incorporated and operating in Australia. The
Company's shares are quoted on the Australian Securities
Exchange (ASX Code: CAA).
The Company's registered office and its principal place of
business is as follows:
Registered office & principal place of business
71 Ashburn Road
Bundamba
QLD 4304
Tel: (07) 3816 7000
The principal continuing activities of the Company and its
subsidiary consist of the manufacturing and distribution of
fabricated and semi-fabricated aluminium related products.
1b. Statement of Compliance
The financial report (consolidated financial statements) is a
general purpose financial report which has been prepared in
accordance with the Australian Accounting Standards
adopted by the Australian Accounting Standards Board and
the Corporations Act 2001. The consolidated financial
statements comply with International Financial Reporting
Standards adopted by the International Accounting
Standards Board.
The consolidated financial statements comprise the
Company and its subsidiary (together referred to as
the ‘Group’).
For the purpose of preparing the consolidated financial
statements, the Group is a for-profit entity.
The consolidated financial statements were authorised for
issue by the Board of Directors on 25 February 2025.
1c. Basis of preparation
Basis of measurement
The consolidated financial statements have been prepared
on the basis of historical cost, except for the revaluation of
certain non-current assets and financial instruments items
as described in Note 26. Cost is based on the fair values of
the consideration given in exchange for assets. All amounts
are presented in Australian dollars, unless otherwise noted.
The Company is of a kind referred to in ASIC Corporations
Instrument 2016/191 issued by the Australian Securities
and Investments Commission and in accordance that
instrument, amounts in the consolidated financial
statements and the directors’ report have been rounded off
in accordance with that ASIC Corporations Instrument to
the nearest thousand dollars, or in certain cases, the
nearest dollar as indicated.
Use of judgements and estimates
Management is required to make judgements, estimates
and assumptions about carrying values of assets and
liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on
historical experience and various other factors that are
believed to be reasonable under the circumstances, the
results of which form the basis of making the judgements.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on
an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if
the revision affects only that period, or in the period of the
revision and future periods if the revision affects both
current and future periods.
48
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
1d. Foreign Currency
In preparing the consolidated financial statements,
transactions in currencies other than the Group's functional
currency (foreign currencies) are recorded at the rates of
exchange prevailing on the dates of the transactions. At
each balance date, monetary items denominated in foreign
currencies are retranslated at the rates prevailing at the
balance date. Non-monetary items carried at fair value that
are denominated in foreign currencies are retranslated at
the rates prevailing on the date when the fair value was
determined. Non-monetary items that are measured in
terms of historical cost in a foreign currency are not
retranslated.
Exchange differences are recognised in profit or loss in the
period in which they arise.
1e. Goods and Services Tax
Revenues, expenses and assets are recognised net of the
amount of goods and services tax (GST) except where the
amount of GST incurred is not recoverable from the taxation
authority, it is recognised as part of the cost of acquisition
of an asset or as part of an item of expense.
Receivables and payables are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the
taxation authority is included as part of receivables or
payables. Cash flows are included in the consolidated
statement of cash flow on a gross basis. The GST
component of cash flows arising from investing and
financing activities which is recoverable from, or payable to,
the taxation authority, is classified as operating cash flows.
1f. Adoption of new and revised
Accounting Standards
The Group has adopted all of the new and revised
Standards and Interpretations issued by the Australian
Accounting Standards Board (the AASB) that are relevant
to its operations and effective for an accounting period
that begins on or after 1 January 2024.
The following new and amended accounting standards
are adopted by the Group and does not have a material
impact on the Group’s consolidated financial statements.
• AASB 2020-1 Amendments to Australian Accounting
Standards – Classification of Liabilities as Current or
Non-current
• AASB 2022-6 Amendments to Australian Accounting
Standards – Non-current Liabilities with Covenants
• AASB 2023-1 Amendments to Australian Accounting
Standards – Supplier Finance Arrangements
• AASB 2022-5 Amendments to Australian Accounting
standards – Lease Liability in a Sale and Leaseback
Accounting Standard in issue but not yet effective:
A number of new accounting standards are effective for
annual reporting periods beginning after 1 January 2027
and earlier application is permitted. However, the Group
has not early adopted the following new or amended
accounting standards in preparing these consolidated
financial statements.
AASB 18 will replace AASB 101 Presentation of Financial
Statements and applies for annual reporting periods
beginning on or after 1 January 2027. The new standard
introduces the following key new requirements.
• Entities are required to classify all income and
expenses into five categories in the consolidated
statement of profit or loss and other comprehensive
income, namely the operating, investing, financing,
discontinued operations and income tax categories.
Entities are also required to present a newly-defined
operating profit subtotal. Entities’ net profit will not
change.
• Management-defined performance measures (MPMs)
are disclosed in a single note in the consolidated
financial statements.
• Enhanced guidance is provided on how to group
information in the consolidated financial statements.
49
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
In addition, all entities are required to use the operating
profit subtotal as the starting point for the consolidated
statement of cash flows when presenting operating cash
flows under the indirect method.
The Group is still in the process of assessing the impact
of the new standards, particularly with respect to the
structure of the Group’s consolidated statement of profit
or loss and other comprehensive income, the
consolidated statement of cash flows and the additional
disclosures required for MPMs. The Group is also
assessing the impact on how information is grouped in
the consolidated financial statements, including for items
currently labelled as ‘other’.
The following new and amended accounting standards
are not expected to have a material impact on the Group’s
consolidated financial statements.
• Lack of Exchangeability (Amendments to AASB 21)
• Classification and Measurement of Financial
Instruments (Amendments to AASB 9 and AASB 7)
• Amendments to Australian Accounting Standards
– Annual Improvements Volume 11
• AASB 2014-10 Amendments to Australian Accounting
Standards – Sale or Contribution of Assets between
an Investor and its Associate or Joint Venture
1g. Material accounting policies
The accounting policies provided throughout Notes 2 to 35
of this consolidated financial statements have been applied
consistently to all periods presented in the consolidated
financial statements.
50
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
2
Profit for the Year
CONSOLIDATED
2024
2023
Note
$’000
$’000
(a) Other Expenses
Profit before tax includes the following specific net expenses:
Amortisation of intangibles assets
314
175
Total amortisation
12
314
175
Depreciation – owned assets
Buildings
289
292
Leasehold improvements
648
610
Plant and equipment
8,097
7,230
Total depreciation – owned assets
11
9,034
8,132
Depreciation – right of use assets
Buildings
12,439
12,345
Plant and equipment
2,044
2,357
Total depreciation – right of use assets
14
14,483
14,702
Total depreciation and amortisation
23,831
23,009
Occupancy costs
Site costs
5,491
5,966
5,491
5,966
Expense relating to leases of low value assets
100
85
Other charges against assets
Increase in impairment of trade receivables
12
74
Employee benefit expense
Post-employment benefits:
- defined contribution plans
9,237
8,505
Equity-settled share-based payments
1,095
1,045
Other employee benefits
105,197
99,516
115,529
109,066
Total finance costs are comprised of:
Interest and fees on bank credit facilities
439
1,995
Interest component of lease liabilities
4,762
4,430
Impact of discounting on long-term provisions
371
257
Total finance costs
5,572
6,682
Other expenses
Other labour cost
11,868
11,516
Utilities
9,894
10,520
Insurance
2,896
3,464
Other
16,623
10,955
Total other expenses
41,281
36,455
(b) Gains and Losses
Net (loss)/gain on foreign exchange
(486)
1,122
51
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
3
Revenue and Other Income
CONSOLIDATED
2024
2023
$’000
$’000
Revenue from continuing operations
Sales revenue - sale of goods (i)
604,398
614,844
Other revenue
Scrap revenue (i)
45,300
42,015
Total other revenue
45,300
42,015
Other income
Sub-lease rental income
3,705
3,526
Other miscellaneous income
2
2
Interest income
1,705
805
5,412
4,333
(i) Recognised at a point in time.
Performance obligations and
revenue recognition policies
Revenue is recognised when (or as) a performance
obligation is satisfied, i.e. when ‘control’ of the goods or
services underlying the particular performance obligation is
transferred to the customers.
The Group recognises revenue from the sale of products
and the sale of scrap and when it transfers control of a
product to a customer, which is the point in time that the
customer obtains control of the goods being on acceptance
of the goods by the customer.
Revenue is measured at the fair value of the consideration
received or receivable. Sales revenue comprises sales of
goods and services at net invoice values less returns, trade
allowances and applicable rebates.
Sub-lease rental income
Rental income from operating leases is recognised on a
straight-line basis over the term of the relevant lease. Initial
direct costs incurred in negotiating and arranging an
operating lease are added to the carrying amount of the
leased assets and recognised on a straight-line basis over
the lease term.
Interest income
Interest income is accrued on a time basis, by reference to
the principal outstanding and at the effective interest rate
applicable, which is the rate that exactly discounts
estimated future cash receipts through the expected life of
the financial asset to that asset’s net carrying amount.
52
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
4
Income Tax
CONSOLIDATED
2024
2023
$’000
$’000
Current Tax:
Current year
-
-
Deferred Tax:
Recognition of previously unrecognised tax losses and deductible
temporary differences
3,610
-
Income tax benefit
3,610
-
The benefit for the year can be reconciled to profit before tax as follows:
Profit before income tax benefit
28,877
31,839
Income tax calculated @ 30% (2023:30%)
8,663
9,552
Tax effect of non-assessable / non-deductible items:
Effect of expenses that are not deductible or taxable in determining
taxable profit
458
580
Tax effect of costs deductible upon purchase of shares on-market for
future issuance to employees
(107)
(685)
Tax effect of utilisation of tax losses and temporary differences not
previously recognised
(9,014)
(9,447)
-
-
Previously unrecognised and unused tax losses and temporary
differences now recognised as deferred tax assets
3,610
-
Income tax benefit recognised in profit or loss
3,610
-
Accounting policy
The income tax expense or benefit for the year is the tax
payable or tax receivable on the current year’s taxable
income based on the national income tax rate 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 consolidated
financial statements, and to unused tax losses.
The Company and its wholly owned Australian entities have
implemented the tax consolidation legislation.
The current and deferred tax amounts for the tax-consolidated
group are allocated to the members of the tax-consolidated
group (including the Company as the head entity) using the
‘separate taxpayer within group’ approach, with deferred taxes
being allocated by reference to the carrying amounts in the
financial statements of each member entity and the tax values
applying under tax consolidation. Current tax liabilities and
assets and deferred tax assets arising from unused tax losses
and relevant tax credits arising from this allocation process
are then accounted for as immediately assumed by the head
entity, as under Australian taxation law the head entity has the
legal obligation (or right) to these amounts.
53
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
5
Segment Information
The information reported to Capral’s Board of Directors, as
the Group’s chief operating decision maker, for the
purposes of resource allocation and assessment of
performance is focused on the type of goods supplied,
being aluminium products. As such, in 2023 and 2024, the
Group operated in one reportable segment under AASB 8
Operating Segment.
Major Products and Services
The Group produces a wide range of extruded aluminium
products and systems. It distributes those manufactured
products in addition to a small number of bought-in
products through two distribution channels.
The Group supplies to three market segments through each
of its distribution channels:
• Residential - supply of aluminium and other components
for windows and doors, showers and wardrobes and
security products,
• Commercial - supply of aluminium and other
components for windows and doors, internal fit outs and
other commercial building related products, and
• Industrial - supply of aluminium extrusions and rolled
products for industrial uses.
Geographic Information
The Group operates in one geographical area, Australia.
Information About Major Customers
There are no individual major customers who contributed
more than 10% of the Group’s revenue in either the
Financial Year or in 2023.
6
Current Assets - Cash and Cash Equivalents
CONSOLIDATED
2024
2023
$’000
$’000
Cash at bank and cash in hand
68,907
59,457
Accounting policy
Cash comprises cash on hand and demand deposits.
54
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
7
Current Assets - Trade and Other Receivables
CONSOLIDATED
2024
2023
$’000
$’000
Trade receivables - at amortised cost
84,428
83,153
Loss allowance (i)
(328)
(316)
84,100
82,837
Other receivables
7,727
6,476
91,827
89,313
The average credit period on sales of goods is approximately 43 days (2023: 42 days). No interest is charged on trade
and other receivables.
CONSOLIDATED
2024
2023
$’000
$’000
(i) Movement in the loss allowance.
Balance at beginning of the financial year
(316)
(242)
Amounts written off during the financial year
260
254
Increase in allowance recognised in profit or loss
(272)
(328)
Balance at end of the financial year
(328)
(316)
The Group always measures the loss allowance for trade receivables at an amount equal to lifetime expected credit loss
(“ECL”). The ECL on trade receivables are estimated using a provision matrix by reference to past default experience of the
debtor and an analysis of the debtor’s current financial position, adjusted for factors that are specific to the debtors, general
economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the
forecast direction of conditions at the reporting date. Allowances are made for known doubtful debts at the time of
appointment of administrators, liquidators, or other formal insolvency events.
Included in the Group’s trade receivables are debtors with balances in 61 days and over of $515,000 (2023: $667,000), refer to
note 26(h). The Group has not provided for all of these balances as the Group believes that these past due balances are still
recoverable. In relation to some of the balances the Group holds personal property securities registrations and/or personal
guarantees and/or trade credit insurance for 80% of the amount outstanding (after applying the deductible). The average age
of these receivables is 101 days (2023: 88 days).
55
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
7
Current Assets - Trade and Other Receivables (cont’d)
Trade receivables risk profile (excluding individually impaired):
CONSOLIDATED
2024
2023
$’000
$’000
Current
66,708
62,513
1-30 days past due
15,513
18,636
31-60 days past due
1,692
1,337
61+ days past due
187
413
Total
84,100
82,899
Included in the loss allowance is the expected credit loss for individually impaired trade receivables with a balance of
$260,000 (2023: $254,000). The impairment recognised represents the difference between the carrying amount of these
trade receivables and the present value of the expected proceeds.
CONSOLIDATED
2024
2023
$’000
$’000
Current
-
-
1-30 days past due
-
-
31-60 days past due
-
-
61+ days past due
328
254
Total
328
254
Major concentrations of credit risk are in the building, window and door fabricators, transport and marine, general industrial
in Australia. Furthermore, the Group has credit insurance cover which requires ongoing management of credit accounts with
monthly reports provided to the Insurer. The Group writes off a trade receivable when there is information indicating that the
debtor is in severe financial difficulty and there is no realistic prospect of recovery.
56
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
8
Current Assets - Inventories
CONSOLIDATED
2024
2023
$’000
$’000
Raw materials and stores
33,640
27,302
Work in progress
3,490
3,204
Finished goods
118,267
95,644
155,397
126,150
All inventories are net of allowance for obsolescence and are expected to be recovered within 12 months.
Included in the inventories balance is inventories in transit of $37,751,000 (2023: $23,483,000).
Accounting policy
Inventories representing aluminium log, other supplies and
finished goods are valued at the lower of cost and net
realisable value.
Net realisable value represents the estimated selling price
less all estimated costs of completion and costs necessary
to make the sale.
The net realisable value of inventories is the estimated
selling price in the ordinary course of business less
estimated costs to sell which approximates fair value less
cost to sell. The key assumptions require the use of
management judgement and are reviewed annually.
These key assumptions are the variables affecting the
estimated costs to sell and the expected selling price. Any
reassessment of cost to sell or selling price in a particular
year will affect the cost of goods sold.
Aluminium log is valued at moving average of direct
purchase cost. Cost of rolled product has been determined
principally on moving average of direct purchase costs.
Costs for finished and work-in-progress includes moving
average metal cost, direct labour, and appropriate
proportion of fixed and variable factory overhead.
The Group also records impairment allowance on slow,
non-moving and obsolete inventories. The key assumptions
include future sales forecast, forecast LME price and
selection of specific inventory based on the past
consumption patterns vis-à-vis the inventory on hand.
57
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
9
Deferred Tax Assets
Recognised deferred tax assets
Movement in deferred tax balance
Opening net
balance
Recognised in
profit or loss
Closing net
balance
Closing
deferred
tax assets
Closing
deferred
tax liabilities
$’000
$’000
$’000
$’000
$’000
2024
Property plant and equipment
(including right of use assets)
(17,129)
(1,396)
(18,525)
-
(18,525)
Intangible assets
13
(283)
(270)
10
(280)
Trade and other receivables
95
3
98
98
-
Inventories
3,028
(396)
2,632
2,632
-
Trade and other payables
2,197
(107)
2,090
2,090
-
Lease liabilities
17,116
1,679
18,795
18,795
-
Employee benefits
4,152
66
4,218
4,218
-
Provisions
324
(98)
226
226
-
Deferred income
49
18
67
67
-
Tax losses
13,855
4,124
17,979
17,979
-
Tax assets (liabilities) before set-off
23,700
3,610
27,310
46,115
(18,805)
Set-off of tax
-
(18,805)
18,805
Net tax assets
27,310
27,310
-
2023
Property plant and equipment
(including right of use assets)
(16,993)
(136)
(17,129)
-
(17,129)
Intangible assets
13
-
13
13
-
Trade and other receivables
72
23
95
95
-
Inventories
2,881
147
3,028
3,028
-
Trade and other payables
2,780
(583)
2,197
2,197
-
Lease liabilities
16,980
136
17,116
17,116
-
Employee benefits
4,133
19
4,152
4,152
-
Provisions
1,268
(944)
324
324
-
Deferred income
46
3
49
49
-
Tax losses
12,520
1,335
13,855
13,855
-
Tax assets (liabilities) before set-off
23,700
-
23,700
40,829
(17,129)
Set-off of tax
-
(17,129)
17,129
Net tax assets
23,700
23,700
-
58
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
9
Deferred Tax Assets (cont’d)
Unrecognised deferred tax assets
2024
2023
Gross amount
Tax effect
Gross amount
Tax effect
$’000
$’000
$’000
$’000
Deductible temporary differences
28,236
8,471
39,345
11,804
Tax losses
103,090
30,927
142,298
42,689
Balance at end of the financial year
131,326
39,398
181,643
54,493
The Group has recognised a deferred tax asset of $27,310,000 (2023: $23,700,000) representing both carry forward tax
losses and deductible temporary differences. The tax losses may be carried forward indefinitely, however subject to income
tax recoupment rules in subsequent years. The recognition of the deferred tax assets is dependent on the three years to four
years forecasted taxable profits. The Group has taken a view that it is probable to achieve forecasted taxable profits in the
next three to four years against which this deferred tax asset recognised would be utilised.
10 Related Parties
Parent entities
The ultimate parent entity within the Group is Capral Limited.
Equity interests in controlled entities
Interest in controlled entities are set out in Note 34.
Transactions with key management personnel
Refer to Note 32 in relation to securities granted and
forfeited during the Financial Year under the Long-Term
Incentive Plan that include rights granted and shares
issued, and the shares allotted under the Short-Term
Incentive Plan, to Capral's Managing Director and Chief
Financial Officer (who are key management personnel).
Refer to Note 33 for the aggregate compensation made
to Director of the Company and key management
personnel of the Group.
Accounting policy
Refer to Note 4.
Deferred tax assets are recognised for deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.
Use of estimates and judgements
The recognition of deferred tax assets is based upon
whether it is more likely than not that sufficient and suitable
taxable profits will be available in the future against which
the reversal of temporary differences can be deducted and
unrecognised tax losses utilised. To determine the future
taxable profits, reference is made to the latest available
profit forecasts. Relevant tax law is considered to determine
the availability of the losses to offset against the future
taxable profits. Recognition of deferred tax assets therefore
involves judgement regarding the future financial
performance of the particular legal entity or tax group in
which the deferred tax asset has been recognised together
with availability of such losses.
59
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
11 Property, Plant and Equipment
CONSOLIDATED
2024
2023
$’000
$’000
Freehold land
At valuation
1,700
1,700
Accumulated depreciation
-
-
Net book amount
1,700
1,700
Buildings
At valuation
5,656
5,654
Accumulated depreciation
(1,327)
(1,039)
Net book amount
4,329
4,615
Leasehold improvements
At cost
14,511
14,395
Accumulated depreciation
(9,903)
(9,256)
Accumulated impairment
(1,970)
(1,970)
Net book amount
2,638
3,169
Total land and buildings
8,667
9,484
Plant, machinery and equipment
At cost
251,579
238,785
Accumulated depreciation
(174,646)
(166,678)
Accumulated impairment
(32,099)
(32,099)
Net book amount
44,834
40,008
Capital work in progress at cost
5,539
8,026
Net plant, machinery and equipment
50,373
48,034
Total property, plant and equipment - net book value
59,040
57,518
60
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
11 Property, Plant and Equipment (cont’d)
Reconciliations
Reconciliations of the carrying amounts of each class of property, plant and equipment at the beginning and end of the
current and prior financial years are set out below:
Freehold land at
fair value
Buildings at
fair value
Leasehold
improvements
at cost
Plant and
equipment
at cost
Capital work
in progress
at cost
Total
$’000
$’000
$’000
$’000
$’000
$’000
Consolidated
2024
Opening net book amount
1,700
4,615
3,169
40,008
8,026
57,518
Additions
-
1
117
6,341
3,679
10,138
Business acquisition
-
-
-
760
-
760
Disposals
-
-
-
(16)
(53)
(69)
Transfers
-
2
-
5,838
(6,113)
(273)
Depreciation charge (Note 2(a))
-
(289)
(648)
(8,097)
-
(9,034)
Net book amount at
31 December 2024
1,700
4,329
2,638
44,834
5,539
59,040
2023
Opening net book amount
1,700
4,881
3,641
38,191
8,231
56,644
Additions
-
6
117
5,233
3,651
9,007
Disposals
-
-
-
(1)
-
(1)
Transfers
-
20
21
3,815
(3,856)
-
Depreciation charge (Note 2(a))
-
(292)
(610)
(7,230)
-
(8,132)
Net book amount at
31 December 2023
1,700
4,615
3,169
40,008
8,026
57,518
61
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
Accounting policy
Recognition and measurement
Buildings are measured at fair value less any accumulated
depreciation and impairment losses. Land is measured at fair
value less any accumulated impairment losses. Fair value is
determined on the basis of a periodic, independent valuation
by external valuation experts, based on discounted cash
flows or capitalisation of net income, as appropriate.
Periodic reviews are conducted every three to five years. The
fair values are recognised in the consolidated financial
statements of the Group and are reviewed at the end of each
reporting period to ensure that the carrying value of land and
buildings is not materially different from their fair values. Any
revaluation increase arising on revaluation of land and
buildings are credited to the asset revaluation reserve except
to the extent that the increase reverses a revaluation
decrease for the same asset previously recognised as an
expense in profit or loss, in which case the increase is
credited to the profit and loss to the extent of the decrease
previously charged. A decrease in carrying amount arising on
the revaluation of land and buildings is charged as an
expense in profit or loss to the extent that it exceeds the
balance, if any, held in the revaluation reserve relating to a
previous revaluation of that asset.
On the subsequent sale or retirement of revalued property,
the attributable revaluation surplus remaining in the
revaluation reserve, net of any related taxes, is transferred
directly to retained earnings.
An independent valuation of the Group’s land and buildings
was performed in December 2021 using Capitalisation and
Direct Comparison approaches to determine the fair value of
the land and buildings. The valuations, which conform to
International Valuation Standards, were determined by
reference to recent market transactions on arm’s length
terms at the time. The fair value of the Land and Buildings is
$1,700,000 and $5,000,000 respectively.
Plant and equipment, and leasehold improvements are stated
at cost less accumulated depreciation and impairment. Cost
includes expenditure that is directly attributable to the
acquisition of the item.
Leasehold improvements are depreciated over the period of
the lease or estimated useful life, whichever is shorter, using
the straight-line method. The estimated useful lives, residual
values and depreciation method are reviewed at the end of
each reporting period, with the effect of any changes
recognised on a prospective basis.
Depreciation
Depreciation is provided on property, plant and equipment,
including freehold buildings but excluding land. Depreciation
is charged to the profit or loss on a straight-line basis so as
to write off the net cost or other revalued amount of each
asset over its expected useful life to its estimated residual
value.
The following useful lives are used in the calculation of
depreciation:
Buildings
20-33 Years
Leasehold improvements
5-25 Years
Plant and equipment
3-25 Years
The Group reviews the estimated useful lives of property,
plant and equipment at the end of each reporting period and
adjusted if appropriate.
Impairment of non-financial assets inclusive of right
of use assets and goodwill
At each reporting date, the Group reviews the carrying
amounts of its tangible and intangible assets to determine
whether there is any indication that those assets have
suffered an impairment loss. If any such indication exists,
the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any). Where
the asset does not generate cash flows that are independent
from other assets, the Group estimates the recoverable
amount of the cash-generating unit (CGU) to which that
asset belongs. Management views the Group as
representing one CGU.
If there is an indication of impairment, the recoverable
amount of property, plant & equipment and intangible assets
will be determined by reference to a value in use discounted
cash flow valuation of the Group, utilising financial forecasts
and projections.
Recoverable amount is the higher of fair value less costs to
sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using
a post-tax discount rate that reflects current market
assessments of the time value of money and the risks
specific to the asset for which the estimates of future cash
flows have not been adjusted. Cash flows that may result
from prior period tax losses are not taken into account. If the
recoverable amount of an asset (or CGU) is estimated to be
less than its carrying amount, the carrying amount of the
asset (CGU) is reduced to its recoverable amount. An
impairment loss is recognised in profit or loss immediately.
11 Property, Plant And Equipment (cont’d)
62
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
Impairment of non-financial assets inclusive of
right of use assets and goodwill (cont’d)
The key assumptions used in preparing the value in
use cash flow valuation as at 31 December 2024
are as follows:
The table below shows key assumptions in the value in
use calculation as at 31 December 2024.
Input to the model
WACC (Post-tax)
10.54%
Average volumes increase 2026-29 p.a.
1.00%
Long-term growth rate
1.00%
The valuation is based on forecast and projected cash
flows for a 5-year period commencing January 2025 with
a terminal value being applied at the end of this period.
The cash flow assumptions are based on Board
approved budgets for the year from January 2025 to
December 2025. Beyond this date cash flow projections
until 31 December 2029 are based on projected volume
growth and expected improvements in EBITDA per tonne
(refer below). Sales volumes are projected to grow at
1.0% per annum, from 2026 onwards. This growth rate
corresponds with the average long-term growth rate
based on external economic sources.
Volumes
In determining assumptions in relation to sales volumes
into the commercial and residential/domestic market,
Capral have based these on reputable third-party long
term economic forecast reports with reference to
historical performance and seasonal trends.
Margins
In setting price and margin assumptions, historical
performance trends and the impact of previous price
increases were reviewed in assessing the timing and
quantum of future price increases.
Recent history in relation to direct costs and the impact
of changing volumes on manufacturing variances were
assessed in setting assumptions on absorbed
conversion costs.
In forecasting the margin, management has considered
the production capacity of Capral compared to current
volumes and concluded that increase in production
volumes to satisfy demand expected by independent
market predictions can be attained by predominately
increasing variable cost with very limited additional fixed
cost expenditure.
Working capital and capital expenditure
These assumptions were set in light of strategic
initiatives and the Board approved maintenance and
safety capital expenditure, with working capital flexed in
relation to the assumed production capacity for volumes
throughout the forecast period and historical
performance and considering revisions to trading terms
with key suppliers and customers.
WACC (post tax)
A discount rate of 10.54%, representing the Group’s
post-tax weighted average cost of capital has been
applied to the cash flow projections.
Economic factors
Assumptions including Gross Domestic Production
(GDP), the Consumer Price Index (CPI), expected wage
and salary increases, foreign exchange and the future
impact of aluminium prices have been made with
reference to third party economic forecasts and the
Group’s strategic plans and budgets.
The result of impairment assessment
as at 31 December 2024
Reasonably possible changes in the key assumptions
disclosed above are unlikely to result in impairment
of the CGU.
11 Property, Plant And Equipment (cont’d)
63
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
12 Other Intangibles Assets
Customer
relationships
Other
intellectual
property
Software
Total
$’000
$’000
$’000
$’000
Consolidated
2024
Cost
1,060
16,193
25,186
42,439
Accumulated amortisation
(124)
(8,388)
(22,322)
(30,834)
Accumulated impairment
-
(7,560)
(2,466)
(10,026)
Net book value
936
245
398
1,579
2023
Cost
-
15,937
25,169
41,106
Accumulated amortisation
-
(8,373)
(22,147)
(30,520)
Accumulated impairment
-
(7,560)
(2,466)
(10,026)
Net book value
-
4
556
560
Reconciliations
Reconciliations of the carrying amounts of each class of intangibles at the beginning and end of the current Financial Year
are set out below:
Customer
relationships
Other
intellectual
property
Software
Total
$’000
$’000
$’000
$’000
Consolidated
2024
Opening net book amount
-
4
556
560
Business acquisition
1,060
-
-
1,060
Transfers
-
256
17
273
Amortisation
(124)
(15)
(175)
(314)
Net book amount at 31 December 2024
936
245
398
1,579
2023
Opening net book amount
-
9
640
649
Additions
-
-
86
86
Amortisation
-
(5)
(170)
(175)
Net book amount at 31 December 2023
-
4
556
560
64
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
12 Other Intangibles Assets (cont’d)
Accounting policy
Other intangible assets acquired separately are measured
on initial recognition at cost. Following initial recognition,
intangible assets are carried at cost less accumulated
amortisation and any impairment losses.
The other intangible assets acquired in business
combinations are mainly customer relationships. The cost
of assets is their fair value at date of acquisition based on
valuation techniques generally using multi-period excess
earnings method.
Subsequent expenditure on capitalised assets is capitalised
only when it increases the future economic benefits
embodied in the specific asset to which it relates. All other
expenditure is expensed as incurred.
Other intangible assets are amortised on a straight-line
basis over their estimated useful lives from the date they are
available for use. Customer relationships are amortised over
a five-year period.
The following useful lives are used in the calculation of
amortisation:
Customer relationships
5 Years
Other intellectual property
5-10 Years
Software
3-10 Years
Impairment assessment is performed based on
assumptions and estimates as disclosed in Note 11.
13 Goodwill
CONSOLIDATED
2024
2023
$’000
$’000
Cost
Opening balance
3,070
3,070
Business acquisition
1,629
-
Closing balance
4,699
3,070
Accounting policy
Goodwill acquired in a business combination is initially measured at cost. Cost is measured as the cost of the business
combination minus the net fair value of the acquired and identified assets, liabilities and contingent liabilities.
Following initial recognitions, goodwill is measured at cost less any accumulated impairment losses.
Goodwill is not amortised, but instead is reviewed for impairment annually or more frequently if events or changes in
circumstances indicate that the carrying value may be impaired.
Impairment assessment is performed based on assumptions and estimates as disclosed in Note 11.
65
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
14 Right-of-Use Assets
Buildings
Plant &
Equipment
Total
$’000
$’000
$’000
Consolidated
Cost
At 1 January 2023
105,043
10,923
115,966
Additions
194
1,727
1,921
Modifications
6,436
2,568
9,004
Terminations
(440)
-
(440)
At 31 December 2023
111,233
15,218
126,451
At 1 January 2024
111,233
15,218
126,451
Additions
716
2,054
2,770
Modifications
7,729
1,150
8,879
Terminations
-
(1,156)
(1,156)
At 31 December 2024
119,678
17,266
136,944
Accumulated depreciation
At 1 January 2023
(42,339)
(6,976)
(49,315)
Terminations
276
-
276
Depreciation charge
(12,345)
(2,357)
(14,702)
At 31 December 2023
(54,408)
(9,333)
(63,741)
At 1 January 2024
(54,408)
(9,333)
(63,741)
Terminations
-
302
302
Depreciation charge
(12,439)
(2,044)
(14,483)
At 31 December 2024
(66,847)
(11,075)
(77,922)
Net Book Value
At 31 December 2024
52,831
6,191
59,022
At 31 December 2023 / 1 January 2024
56,825
5,885
62,710
Impairment assessment is performed based on assumptions and estimates as disclosed in Note 11.
66
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
14 Right-of-Use Assets (cont’d)
The Group leases several assets including buildings and plant and equipment, with average lease term of 4.4 years (2023: 4.5
years) and 5.4 years (2023: 4.3 years) respectively.
The Group has options to purchase certain equipment for a nominal amount at the end of the lease term. The Group’s
obligations are secured by the lessor’s title to the leased assets for such leases.
The Group has renewed some of leases for buildings and equipment in the current Financial Year. The expired contracts were
replaced by new leases for identical underlying assets. This resulted in additions to right-of-use assets of $2,770,000 (2023:
1,921,000) and in modifications of $8,879,000 (2023: 9,004,000) in the current Financial Year.
Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset.
Maturity analysis – sub-lease income
Lease Receivable
CONSOLIDATED
2024
2023
$’000
$’000
Non-cancellable lease receivable
Within one year
3,875
3,067
Later than one year but not later than five years
14,915
13,214
Later than five years
-
1,580
18,790
17,861
Lease receivables relate to the sublease of office and plant premises with a lease term of 10 years, with an option to extend
for a further term of 5 years.
Accounting policy
The Group assesses whether a contract is or contains a
lease, at inception of the contract. The Group recognises a
right-of-use asset and a corresponding lease liability with
respect to all lease arrangements in which it is the lessee,
except for short-term leases (defined as leases with a lease
term of 12 months or less) and leases of low value assets
(such as copiers). For these leases, the Group recognises
the lease payments as an operating expense on a straight-
line basis over the term of the lease unless another
systematic basis is more representative of the time pattern
in which economic benefits from the leased assets are
consumed.
The lease liability is initially measured at the present value
of the lease payments that are not paid at the
commencement date, discounted by using the rate implicit
in the lease. If this rate cannot be readily determined, the
Group uses its incremental borrowing rate.
Lease payments included in the measurement of the lease
liability comprise:
• Fixed lease payments (including in-substance fixed
payments), less any lease incentives receivable;
• Variable lease payments that depend on an index or
rate, initially measured using the index or rate at the
commencement date; and
• Payments of penalties for terminating the lease, if the
lease term reflects the exercise of an option to
terminate the lease.
The lease liability is subsequently measured by increasing
the carrying amount to reflect interest on the lease liability
(using the effective interest method) and by reducing the
carrying amount to reflect the lease payments made.
The Group remeasures the lease liability (and makes a
corresponding adjustment to the related right-of-use
asset) whenever:
67
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
The lease term has changed or there is a significant event
or change in circumstances resulting in a change in the
assessment of exercise of a purchase option, in which
case the lease liability is remeasured by discounting the
revised lease payments using a revised discount rate.
The lease payments change due to changes in an index or
rate or a change in expected payment under a guaranteed
residual value, in which cases the lease liability is
remeasured by discounting the revised lease payments
using an unchanged discount rate (unless the lease
payments change is due to a change in a floating interest
rate, in which case a revised discount rate is used).
A lease contract is modified and the lease modification is
not accounted for as a separate lease, in which case the
lease liability is remeasured based on the lease term of
the modified lease by discounting the revised lease
payments using a revised discount rate at the effective
date of the modification.
The right-of-use assets comprise the initial measurement
of the corresponding lease liability, lease payments made
at or before the commencement day, less any lease
incentives received and any initial direct costs. They are
subsequently measured at cost less accumulated
depreciation and impairment losses.
The depreciation starts at the commencement date
of the lease.
Operating lease payments are recognised as an expense
on a straight-line basis over the lease team, except where
another systematic basis is more representative of the
time pattern in which economic benefits from the leased
asset are consumed.
In the event that lease incentives are received to enter into
operating leases, such incentives are recognised as a
liability. The aggregate benefits of incentives are
recognised as a reduction of rental expense on a straight-
line basis, except where another systematic basis is more
representative of the time pattern in which economic
benefits from the leased asset are consumed.
14 Right-of-Use Assets (cont’d)
The Group reassess whether it is reasonably certain to
exercise an extension option, or not to exercise a termination
option, upon the occurrence of either a significant event or a
significant change in circumstances that:
• is within the control of the Group; and
• affects whether the Group is reasonably certain to
exercise an option not previously included in its
determination of the lease term, or not to exercise an
option previously included in its determination of the
lease term.
The incremental borrowing rate is defined as the rate of
interest that the lessee would have to pay to borrow over a
similar term and with a similar security the funds necessary
to obtain an asset of a similar value to the right-of-use asset
in a similar economic environment.
When the Group is an intermediate lessor, it accounts for its
interests in the head lease and the sub-lease separately. It
assesses the lease classification of a sub-lease with
reference to the right-of-use asset arising from the head
lease, not with reference to the underlying asset. If a head
lease is a short-term lease to which the Group applies the
exemption described above, then it classifies the sub-lease
as an operating lease.
The Group recognises lease payments received under
operating leases as income on a straight-line basis over the
lease term as part of ‘other income’.
68
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
15 Assets Pledged as Security
In accordance with the security arrangements of liabilities disclosed in Note 23, all assets of the Group have been pledged as
security. The holder of the security does not have the right to sell or repledge the assets other than in the event of default
under the principal finance agreement where the security is enforced.
16 Current Liabilities – Trade and Other Payables
CONSOLIDATED
2024
2023
$’000
$’000
Trade payables (i)
124,949
89,388
Goods and services tax payable
1,229
2,168
Other payables
15,189
15,418
141,367
106,974
(i) The average credit period on purchases is 81 days from the end of the month (2023: 82 days). No interest is charged on the trade payables.
The Group has financial risk management policies in place to ensure that all payables are paid within the credit timeframe.
17 Lease Liabilities
CONSOLIDATED
2024
2023
$’000
$’000
Current
16,928
15,558
Non-current
66,000
73,255
82,928
88,813
Maturity analysis
Within one year
16,928
15,558
Later than one year but not later than five years
56,917
59,353
Later than five years
9,083
13,902
82,928
88,813
At 31 December 2024, the Group is committed to $100,000 (2023: $201,000) for low value leases and has no short- term
lease commitments.
Accounting policy
Refer to Note 14.
69
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
18 Provisions
CONSOLIDATED
2024
2023
$’000
$’000
Current
Employee benefits
14,061
13,841
Make good on leased assets1
509
254
Other2
243
825
14,813
14,920
Non-current
Employee benefits
2,517
2,365
Make good on leased assets1
5,440
5,219
7,957
7,584
1 Provision for make good on leased assets comprises obligations relating to site closure and other costs associated with lease rental properties.
2 Other current provisions include provisions for insurance claims and provisions for customer claims including metal returns net of scrap and
pricing adjustments.
Consolidated
Employee
benefits
Make good on
leased assets
Other
Total
Movements in carrying amounts
$’000
$’000
$’000
$’000
Carrying value at the beginning of the financial year
16,206
5,473
825
22,504
Provision utilised/released in the year
(6,586)
-
(582)
(7,168)
Additional amounts provided
6,958
476
-
7,434
Carrying value at the end of the financial year
16,578
5,949
243
22,770
70
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
Accounting policy
Employee benefits:
Salaries, wages and leave benefits
A liability is recognised for benefits accruing to employees
in respect of wages and salaries, including non-monetary
benefits, annual leave and long service leave, when it is
probable that settlement will be required, and they are
capable of being measured reliably. Liabilities recognised in
respect of short-term employee benefits are measured at
their nominal values using the remuneration rate expected
to apply at the time of settlement. Liabilities recognised in
respect of long-term employee benefits are measured at the
present value of the estimated future cash outflows to be
made by the Group in respect of services provided by
employees up to reporting date.
Key assumptions used in the calculation of leave benefit
provision at balance date include future on-cost rates,
experience of employee departures and period of service,
and future increase in wages and salaries.
Defined contribution plan
Contributions to defined contribution superannuation plans
are expensed when incurred.
18 Provisions (cont’d)
Provisions
Provisions are recognised when the Group has a present,
legal or constructive obligation as a result of past events, it
is probable that the Group will be required to settle the
obligation, and a reliable estimate can be made of the
amount of the obligation.
The amount recognised as a provision is the best estimate
of the consideration required to settle the present obligation
at reporting date, taking into account the risks and
uncertainties surrounding the obligation. Where a provision
is measured using the cashflows estimated to settle the
present obligation, its carrying amount is the present value
of those cashflows. When some or all of the economic
benefits required to settle a provision are expected to be
recovered from a third party, the receivable is recognised as
an asset if it is virtually certain that the reimbursement will
be received and the amount of the receivable can be
measured reliably.
Provision for restoration and rehabilitation (provision for
make good on leased assets)
A provision for restoration and rehabilitation (provision for
make good on leased assets) is recognised when there is a
present obligation as a result of production activities
undertaken, it is probable that an outflow of economic
benefits will be required to settle the obligation, and the
amount of the provision can be measured reliably. The
estimated future obligations include the costs of removing
the facilities and restoring the affecting areas.
71
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
19 Ordinary Shares
2024
2023
2024
2023
No 000
No 000
$’000
$’000
(a) Share capital
Ordinary shares: fully paid
17,033
17,687
409,124
424,771
Fully paid ordinary shares carry one vote per share and carry the right to dividends.
(b) Movement in ordinary share capital
Date
Details
Number of shares
Issue Price
$'000
1 January 2023
Balance at the beginning of the financial year
17,767,272
-
433,433
March 2023
Shares issued - deferred STIP
5,131
$8.423
43
March 2023
Shares issued against performance rights
278,320
-
-
September 2023
Shares cancelled – on-market buy-back1
(106,074)
$23.932
(2,539)
October 2023
Shares cancelled – on-market buy-back1
(60,020)
$23.932
(1,436)
November 2023
Shares cancelled – on-market buy-back1
(76,087)
$23.932
(1,821)
December 2023
Shares cancelled – on-market buy-back1
(121,532)
$23.932
(2,909)
31 December 2023
Balance at the end of the financial year
17,687,010
-
424,771
1 January 2024
Balance at the beginning of the financial year
17,687,010
-
424,771
March 2024
Shares cancelled – on-market buy-back1
(42,421)
$23.932
(1,015)
April 2024
Shares cancelled – on-market buy-back1
(68,680)
$23.932
(1,644)
May 2024
Shares cancelled – on-market buy-back1
(115,133)
$23.932
(2,755)
June 2024
Shares cancelled – on-market buy-back1
(114,101)
$23.932
(2,731)
September 2024
Shares cancelled – on-market buy-back1
(92,276)
$23.932
(2,208)
October 2024
Shares cancelled – on-market buy-back1
(36,798)
$23.932
(881)
November 2024
Shares cancelled – on-market buy-back1
(44,847)
$23.932
(1,073)
December 2024
Shares cancelled – on-market buy-back1
(139,569)
$23.932
(3,340)
31 December 2024
Balance at the end of the financial year
17,033,185
-
409,124
1 The Board approved the on-market buy-back and the cancellation of up to 1,600,000 (2023: 370,000) shares in line with ASIC/ASX
regulations starting from 11 March 2024. During the Financial Year 653,825 shares were bought back by an independent third-party broker
at an average of $9.511 per share and cancelled at an average price of $23.932 per share ($431,995,567 / 18,050,723 shares). A resultant
gain of $9,429,000 has been presented under a separate reserve account (Share Buy-Back Reserve).
Uncancelled and unallocated Capral shares
At the reporting date, the Group has 132,853 (31 December 2023: 287,526) uncancelled and unallocated Capral shares
previously bought on-market and remain in the employee share reserve.
72
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
CONSOLIDATED
2024
2023
$’000
$’000
Asset revaluation reserve
4,088
4,088
Equity-settled compensation reserve
13,043
13,936
Employee share reserve
(1,209)
(2,320)
Share buy-back reserve
14,989
5,560
Dividend reserve
116,470
93,683
147,381
114,947
Accumulated losses
(331,376)
(334,986)
(183,995)
(220,039)
20 (a) Movements in reserves were:
Equity-settled compensation reserve
Balance at the beginning of the financial year
13,936
12,891
Expense recognised
1,095
1,045
Conversion of vested rights
(1,988)
-
Balance at the end of the financial year
13,043
13,936
Asset revaluation reserve
Balance at the beginning of the financial year
4,088
4,088
Balance at the end of the financial year
4,088
4,088
Employee share reserve
Balance at the beginning of the financial year
(2,320)
(38)
Employees shares on-market purchasea
(355)
(1,970)
Employees shares off-market purchaseb
-
(361)
Vested performance rights conversion to shares
1,362
-
Employees escrow shares utilisedb
104
49
Balance at the end of the financial year
(1,209)
(2,320)
Share buy-back reserve
Balance at the beginning of the financial year
5,560
-
Net gain on cancelled shares – on-market purchasec
9,429
5,560
Balance at the end of the financial year
14,989
5,560
Dividend reserve
Balance at the beginning of the financial year
93,683
74,338
Profit before tax
28,877
31,839
Dividends paid
(6,090)
(12,494)
Balance at the end of the financial year
116,470
93,683
20 (b) Accumulated losses
Balance at the beginning of the financial year
(334,986)
(334,986)
Profit for the year (Income tax benefit)
3,610
-
Balance at the end of the financial year
(331,376)
(334,986)
a 35,000 shares were purchased at an average price of $10.11 per share by the Capral Employee Share Trustee on-market to allow for full
allotment of 2022 LTIP shares as well as 2024 Escrow allotment in March 2025.
b 48,255 shares were purchased at $7.50 per share by the Capral Employee Share Trustee off-market from Capral’s Managing Director to
allow for full allotment of 2021 LTIP shares as well as 2023 Escrow allotment in March 2024.
During the year, 5,843 shares were utilised for 2022 Escrow allotment.
c Refer to Note 19.
Short-Term Incentives Plan (STIP)
During the year, Capral allocated 12,674 (previously bought on-market) ordinary shares to Capral’s Executives and Senior
Management who purchased Capral’s shares by using the above STIP target component (stretch) of their 2023 financial year
after-tax STIP. These shares are held in escrow by Capral’s share registry for a period of 3 years.
20 Reserves and Accumulated Losses
73
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
21 Dividends
CONSOLIDATED
2024
2023
$’000
$’000
Ordinary shares:
6,090
12,494
Franking credits
Franking credits available for subsequent financial years
based on a tax rate of 30% (2023:30%)
114
2,724
22 Earnings Per Share
CONSOLIDATED
2024
2023
$
$
Basic earnings per share
1.88
1.77
Diluted earnings per share
1.82
1.71
Net profit after tax used in the calculation of basic and diluted profit per share for 2024 was $32,487,000 (2023: $31,839,000).
CONSOLIDATED
2024
2023
Weighted-average number of ordinary shares (basic)
$’000
$’000
Issued ordinary shares at 1 January
17,400
17,767
Effect of treasury shares held
151
233
Effect of cancelled buy-back shares
(266)
(60)
Weighted-average number of ordinary shares at 31 December
17,285
17,940
Weighted-average number of ordinary shares (diluted)
Weighted-average number of ordinary shares (basic)
17,285
17,940
Effect of performance rights on issue
561
635
Weighted-average number of ordinary shares (diluted)
at 31 December
17,846
18,575
Accounting policy
(i) Basic earnings per share
Basic earnings per share is calculated by dividing the
profit/(loss) attributable to equity holders of the Group,
by the weighted average number of ordinary shares
outstanding during the year, adjusted for bonus elements
in ordinary shares issued during the year.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into
account the weighted average number of shares assumed
to have been issued for no consideration in relation to
dilutive potential ordinary shares.
74
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
23 Stand by Arrangement and Credit Facilities
CONSOLIDATED
2024
2023
$’000
$’000
The following facilities were in place:
Secured facilities
70,000
80,000
Unsecured facilities
4,272
4,272
Total secured facilities
74,272
84,272
Facilities used:
Bank guarantees
4,913
4,941
Trade finance – drawn letters of credits
27,085
21,642
Trade finance – open letters of credits
5,354
5,947
Commercial card
157
86
Total facilities utilised
37,509
32,616
Total available facilities
36,763
51,656
To align with Capral’s ongoing requirements, this Multi-option facility was reduced to $60 million from 1 January 2024, to
closely align with Capral’s working capital requirements with an expiry date of 30 April 2025.
The existing ANZ facilities consist of:
Secured:
• $60 million Multi-option Facility which includes a Trade Finance Loan Facility, Trade Instruments and Trade Finance;
• $5 million Loan Facility – Floating Rate; and
• $5 million Standby Letter of Credit or Guarantee Facility.
Unsecured:
• $2.5 million Electronic Payaway Facility; and
• $0.5 million Commercial Card Facility;
• $1.272 million Asset Finance Facility.
The trade loan facility has a maximum drawdown term of 90 days and with an ANZ defined variable base rate plus a margin.
Financial Covenants
Requirements
Compliance Date
Borrow Base Ratio
Not to exceed 80%
At all times
Distributions
No distributions other than Permitted Distributions
At all times
Interest Cover Ratio - EBITDA
Not to be less than 3.00:1 for any 12 month period
31 March, 30 June, 30 September,
31 December in each year
Minimum Tangible Net Worth
Not to be less than AUD100,000,000
At all times
Capral has been in compliance with all financial covenant requirements throughout the year and expects to continue
complying with all financial covenants during the next 12 months.
75
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
24 Commitments for Expenditure - Capital
CONSOLIDATED
2024
2023
$’000
$’000
Commitments for the acquisition of plant and equipment contracted for
at the reporting date but not recognised as liabilities payable:
Within one year
2,278
3,000
25 Fair Value Measurement
Some of the Group’s assets and liabilities are measured at fair value at the end of each reporting period. The following table
gives information about how the fair values of these assets and liabilities are determined (in particular, valuation technique(s)
and input(s) used).
Assets /
liabilities
Fair value as at
Fair value
hierarchy
Valuation technique(s)
and key input(s)
Significant
unobservable
input(s)
Relationship of
unobservable
input(s)
31/12/24
$
31/12/23
$
Foreign currency
forward
contracts
(see note 26(f))
Assets –
2,585,000
Liabilities –
2,016,000
Level 2
Discounted cash flow. Future
cash flows are estimated
based on forward exchange
rate (from observable
forward exchange rates at
the end of the reporting
period) and contract forward
rates, discounted at a rate
that reflects the credit risks
of various counterparties.
n/a
n/a
Land and
buildings
(See Note 11)
Land –
1,700,000
Buildings –
4,329,000
Land –
1,700,000
Buildings –
4,615,000
Level 3
Capitalisation and Direct
Comparison approaches.
(Last assessed 2021)
Comparable to
recent market
transactions on
arm’s length
terms at the time.
The higher/(lower) the
comparable market net
rental amount and the
higher/(lower) the
comparable market
sales transactions, the
higher the fair value.
76
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
Financial covenant description
Required Value
2024 Actual Value
2023 Actual Value
EBITDA Interest Cover Ratio
(A ratio of EBITDA to Interest Expense)
> 3.00:1
18.69:1
22.08:1
Minimum Tangible Net Worth
(Tangible Net Worth – Total Tangible Assets
Less Total Liabilities)
> AUD 100.0m
AUD 217.0m
AUD 205.9m
Borrowing Base Ratio
(A ratio of Aggregate Facility Amount Owing
to Eligible Debtors owing up to 90 days)
< 0.80:1
0.38:1
0.34:1
Distributions
(Any payment or distribution of money
or other assets to shareholders)
Variable*
AUD 12.31m
AUD 15.64m
Inventory Cover Ratio
>0.8:1
n/a
0.87:1
* lower than the profit of prior year
26 Financial Instruments
(a) Capital risk management
The Group manages its capital to ensure that entities in the
Group will be able to continue as going concerns while
maximising the return to shareholders through the
optimisation of the debt and equity balance.
The Group's overall strategy remains unchanged from 2023.
The capital structure of the Group consists of debt, as
disclosed in Note 23, cash and cash equivalents, and equity
holders of the parent, comprising issued capital, reserves
and accumulated losses, as disclosed in Notes 6, 19 and 20
respectively. The Directors review the capital structure on a
regular basis, and at least annually. As a part of this review
the Directors consider the cost of capital and the risks
associated with each class of capital. Based on the
determinations of the Directors, the Group will balance its
overall capital structure through the payment of dividends,
new share issues and share buy-backs as well as the issue
of new debt or the redemption of existing debt.
The Group prepares monthly management accounts,
comprising balance sheet, profit and loss statement and
cash flow statement updates for the current Financial Year
and the current year forecast. The forecast is used to
monitor the Group's capital structure and future capital
requirements, taking into account future capital
requirements and market conditions.
The Group complied with its borrowing financial covenants
under its current facility detailed in Note 23 as at 31
December 2024 and 31 December 2023 as follows:
77
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
(b) Material accounting policies
Derivative financial instruments
The Group enters into a variety of derivative financial instruments to manage its exposure to interest rate and foreign
exchange rate risk, including foreign exchange forward contracts.
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently
remeasured to their fair value at each reporting date.
The resulting gain or loss is recognised in profit or loss.
CONSOLIDATED
(c) Categories of financial instruments
2024
2023
$’000
$’000
Financial Assets
Trade and other receivables
91,827
89,313
Cash and cash equivalents
68,907
59,457
Other financial assets1
2,596
11
Financial Liabilities
Trade and other payables
141,367
106,974
Lease liabilities
82,928
88,813
Other financial liabilities2
-
2,016
1 foreign exchange contract mark-to-market $2,585,000 and security deposit for a site energy supply
(2023: security deposit for a site energy supply).
2 2023: foreign exchange contract mark-to-market $2,016,000.
(d) Financial risk management objectives
The Group’s treasury function monitors and manages the financial risks relating to the operations of the Group through
internal risk reports. These risks include market risk (including currency risk, interest rate risk and equity price risk), credit risk
and liquidity risk. These risks are analysed below.
(e) Market risk
The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates (refer note 26(f))
and interest rates (refer note 26(g)). From time to time, the Group enters into a variety of derivative financial instruments to
manage its exposure to interest rate and foreign currency risk, including foreign exchange forward contracts to hedge the
exchange rate risk arising on the purchase of aluminium log and rolled product from overseas in US dollars.
Market risk exposures are measured using a sensitivity analysis. There has been no material change to the Group’s exposure
to market risks or the manner in which it manages and measures the risk during the Financial Year.
26 Financial Instruments (cont’d)
78
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
26 Financial Instruments (cont’d)
(f) Foreign currency risk management
The Group undertakes certain transactions in foreign currencies, resulting in exposures to exchange rate fluctuations.
Exchange rate exposures are managed within approved policy parameters utilising forward foreign exchange contracts. It is
the policy of the Group to enter into forward foreign exchange contracts from time to time to manage any material risk
associated with anticipated foreign currency sales and purchase transactions.
The carrying amount of the Group’s foreign currency denominated monetary assets and monetary liabilities at the reporting
date is as follows:
CONSOLIDATED
2024
2023
$’000
$’000
USD (cash)
4,231
5,094
EURO (cash)
388
797
USD (trade payables)
(13,984)
(12,941)
EURO (other receivables)
474
1,087
JPY (trade payables)/trade receivables
(23)
24
USD trade receivables/(other payables)
583
(3)
Foreign currency sensitivity
The Group is exposed to EUR, JPY and USD (2023: EUR, JPY and USD).
To mitigate foreign currency risk at reporting date, the Group entered into foreign exchange forward contracts. The Group’s
exposure to foreign exchange rate fluctuations was primarily limited to cash, trade and other payables and trade receivables
outstanding at reporting date denominated in currencies other than Australian dollar (AUD). The total value of trade payables
denominated in currencies other than the AUD at reporting date was $14,007,000 (2023: $11,830,000). The total value of
trade receivables denominated in currencies other than the AUD at reporting date was $583,000 (2023: -$3,000).
The following table details the Group’s sensitivity to a 10% increase and decrease in the AUD against the relevant unhedged
foreign currency. 10% represents management’s assessment of the possible change in foreign exchange rates. The
sensitivity analysis includes only foreign currency denominated monetary items outstanding at 31 December 2024 and 31
December 2023 and adjusts their translation at the period end for a 10% change in foreign currency rates. A positive number
indicates an increase in profit.
CONSOLIDATED
2024
2023
$’000
$’000
Profit or loss (after tax)
- AUD strengthens by 10% against USD
1,218
1,177
- AUD weakens by 10% against USD
(1,489)
(1,438)
- AUD strengthens by 10% against EUR
(43)
(99)
- AUD weakens by 10% against EUR
53
121
- AUD strengthens by 10% against JPY
(2)
(2)
- AUD weakens by 10% against JPY
3
3
79
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
26 Financial Instruments (cont’d)
(f) Foreign currency risk management (cont’d)
Forward foreign exchange contracts
It is the policy of the Group to enter into forward foreign exchange contracts to cover specific material foreign currency
payments and receipts.
The following table details the forward foreign currency (FC) contracts outstanding at the end of the reporting period:
Outstanding contracts
Foreign currency
Fair value
31/12/24
FC$’000
31/12/23
FC$’000
31/12/24
$’000
Gain/(Loss)
31/12/23
$’000
Gain/(Loss)
Buy EUR
650
816
17
(25)
Buy GBP
-
5
-
-1
Buy JPY
2,475
2,475
(1)
(1)
Buy CNH
320
320
2
(2)
Buy USD
32,313
26,074
2,567
(1,988)
1 Fair value of the gain/(loss) was less than $1,000, hence, rounded down to nil.
(g) Interest rate risk management
The Group interest rate risk arises from borrowings, cash
and derivatives.
The Group is exposed to interest rate risk as the Group
borrows funds at floating interest rates. Hedging activities
are evaluated regularly to align with interest rate views and
defined risk appetite, ensuring optimal hedging strategies
are applied, by either positioning the balance sheet or
protecting interest expense through different interest rate
cycles. The Group’s exposure to interest rate risk at the
reporting date was considered insignificant and as a result
the Group did not enter into interest rate options.
The Group’s exposures to interest rates on financial assets
and financial liabilities are detailed below.
CONSOLIDATED
2024
2023
$’000
$’000
Profit or loss (after tax)
Impact of a 25bp (2023: 20bp) increase in AUD interest rates
- Cash and cash equivalents
121
83
Impact of a 25bp (2023: 20bp) decrease in AUD interest rates
- Cash and cash equivalents
(121)
(83)
Interest rate sensitivity
The sensitivity analysis below shows the effect on profit or
loss after tax for the financial year if there is a change in
interest rates with all other variables held constant. This is
determined by applying the change in interest rates to both
derivative and non-derivative instruments at the reporting
date that have an exposure to interest rate changes. A
25-basis point (0.25%) increase and a 25-basis point (0.25%)
decrease represents Management’s assessment of the
possible change in interest rates (2023: 20bp or 0.2%
increase and 20bp or 0.2% decrease). A positive number
indicates an increase in profit.
80
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
26 Financial Instruments (cont’d)
(h) Credit risk management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group has exposures to credit risk on cash and cash equivalents, and receivables. The credit risk on financial
assets of the Group which have been recognised on the consolidated statement of financial position, is generally the carrying
amount, net of any allowances for doubtful debts.
The Group does not have any significant exposure to any individual customer or counterparty. Major concentrations of credit
risk are in the construction, transport, consumer durable and electrical industries in Australia. The Group has credit insurance
cover which requires ongoing management of credit accounts with monthly reports provided to the Insurer. Experienced
credit management and associated internal policies ensure constant monitoring of the credit risk for the Group.
There is no concentration of credit risk with respect to receivables as the Group has a large number of customers.
The aging of gross trade receivables is detailed below:
CONSOLIDATED
2024
2023
$’000
$’000
Current
66,708
62,513
1-30 days
15,513
18,636
31-60 days
1,692
1,337
60+ days
515
667
84,428
83,153
81
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
(i) Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board of Directors, who ensure there is an appropriate
liquidity risk management framework for the management of the Group’s short, medium and long-term funding and liquidity
management requirements. The Group manages liquidity risk by maintaining adequate banking facilities and reserve
borrowing facilities, complying with covenants, monitoring forecast and actual cash flows, and matching the maturity profiles
of financial assets and liabilities. Included in Note 23 is a list of additional undrawn facilities that the Group has at its disposal
to further reduce liquidity risk.
Liquidity and interest risk tables
Financial assets are made up of cash of $68,907,000 (2023: $59,457,000) and trade and other receivables of $91,827,000
(2023: $89,313,000). Cash is liquid and trade and other receivables are expected to be realised on average within 43 days
(2023: 42 days). Cash balances earn 4.03% interest per annum (2023: 2.76%). Trade and other receivables are interest-free.
The following table details the Group’s remaining contractual maturity for its non-derivative financial liabilities. The table has
been prepared based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can
be required to pay. The table includes both interest and principal cash flows. The contractual maturity is a fair representation
of management’s expectations of actual repayments.
Weighted average
effective interest rate
Less than 1 year
1 - 5
years
Greater than 5
years
%
$'000
$’000
$’000
Consolidated
2024
Trade and other payables
-
141,367
-
-
Lease liabilities
-
16,928
64,624
9,921
158,295
64,624
9,921
2023
Trade and other payables
-
106,974
-
-
Lease liabilities
-
15,558
59,353
13,902
Other financial liabilities
-
2,016
-
-
124,548
59,353
13,902
26 Financial Instruments (cont’d)
(j) Fair value of financial instruments
The fair value of derivative instruments are calculated using quoted prices. Where such prices are not available, the
discounted cash flow analysis is employed using observable market data for non-option derivatives.
The directors consider that the carrying amounts of other financial assets and financial liabilities recorded at amortised cost
in the consolidated financial statements approximate their fair values.
82
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
26 Financial Instruments (cont’d)
(j) Fair value of financial instruments (cont’d)
Accounting policy
Financial Assets
Financial assets are classified into the following specified
categories: financial assets at amortised cost; and financial
assets at fair value through profit or loss. The classification
depends on the nature and purpose of the financial assets
and is determined at the time of initial recognition.
Effective interest method
The effective interest method is a method of calculating the
amortised cost of a financial asset and of allocating interest
income over the relevant period. The effective interest rate
is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial asset, or,
where appropriate, a shorter period.
Income is recognised on an effective interest rate basis for
debt instruments other than financial assets 'at fair value
through profit or loss'.
Financial assets at FVTPL are measured at fair value at the
end of each reporting period, with any fair value gains or
losses recognised in profit or loss to the extent they are not
part of a designated hedging relationship.
Trade and other receivables
Trade and other receivables are measured at amortised
cost as they are held within a business model to collect
contractual cash flows. Trade and other receivables are
measured at amortised cost using the effective interest
method less impairment. Interest is recognised by applying
the effective interest rate.
Impairment of financial assets
Impairment of financial assets is based on an expected
credit loss (“ECL”) model rather than incurred loss model.
ECLs are a probability-weighted estimate of credit losses.
The Group calculated ECLs based on consideration of
customer-specific factors and actual credit loss experience
over the past 3 years. As a percentage of accounts
receivables, the Group’s actual credit loss experience has
not been material.
In accordance with AASB 9 paragraph 7.2.20 the Group will
recognise a loss allowance at an amount equal to lifetime
expected credit losses at each reporting date. The Group
calculated ECLs based on consideration of customer-
specific factors and actual credit loss experience over the
past 3 years.
For financial assets carried at amortised cost, the amount
of the impairment is the difference between the asset’s
carrying amount and the present value of estimated future
cash flows, discounted at the original effective interest rate.
The carrying amount of the financial asset is reduced by the
impairment loss directly for all financial assets with the
exception of trade receivables where the carrying amount is
reduced through the use of an allowance account. When a
trade receivable is uncollectible, it is written off against the
allowance account. Subsequent recoveries of amounts
previously written off are credited against the allowance
account. Changes in the carrying amount of the allowance
account are recognised in profit or loss.
Derecognition of financial assets
The Group derecognises a financial asset only when the
contractual rights to the cash flows from the asset expire, or
it transfers the financial asset and substantially all the risks
and rewards of ownership of the asset to another entity. If
the Group neither transfers nor retains substantially all the
risks and rewards of ownership and continues to control the
transferred asset, the Group recognises its retained interest
in the asset and an associated liability for the amounts it
may have to pay. If the Group retains substantially all the
risks and rewards of ownership of a transferred financial
asset, the Group continues to recognise the financial asset
and also recognises a collateralised borrowing for the
proceeds received.
Financial liabilities
Financial liabilities are classified as either financial
liabilities ‘at fair value through profit or loss’ or other
financial liabilities.
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss are
stated at fair value, with any resultant gain or loss
recognised in profit or loss. The net gain or loss recognised
in profit or loss incorporates any interest paid on the
financial liability.
Other financial liabilities
Other financial liabilities, including borrowings, are initially
measured at fair value, net of transaction costs.
Other financial liabilities are subsequently measured at
amortised cost using the effective interest method, with
interest expense recognised on an effective yield basis.
83
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
27 Contingent Liabilities
Claims and possible claims, arise in the ordinary course of business against the Group. Capral has fully provided for all known
and determinable material claims.
The Group's bankers have granted guarantees in respect of rental obligations on lease commitments, use of utilities
infrastructure and international trade facilities. At 31 December 2024, these guarantees totalled $4,912,842 (2023: $4,941,002).
The bankers have issued letters of credit in respect of the Group’s purchases internationally. At 31 December 2024, these open
letters of credit totalled $5,354,056 (31 December 2023: $5,946,935).
28 Remuneration of Auditors
CONSOLIDATED
2024
2023
$
$
Audit or review of consolidated financial statements
Auditors of the Group - KPMG
371,187
-
Auditors of the Group - Deloitte Touche Tohmatsu
-
377,600
Other services:
Auditors of the Group - KPMG
- other
6,557
-
Auditors of the Group – Deloitte Touche Tohmatsu
- taxation advice and tax compliance
-
39,454
Total remuneration
377,744
417,054
29 Events After Reporting Date
No other matter or circumstance has arisen since the end of the Financial Year that has significantly affected, or may
significantly affect the Group’s operations, the results of those operations or the Group’s state of affairs in future financial years.
84
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
30 Notes to the Consolidated Statement of Cash Flow
(i)
Reconciliation of profit for the year to net cash flows from operating activities
CONSOLIDATED
2024
2023
$’000
$’000
Profit for the year
32,487
31,839
Non-cash items:
Depreciation and amortisation - owned assets
9,348
8,307
Depreciation and amortisation – right of use assets
14,483
14,702
Loss on sale of property, plant and equipment
69
1
Income tax benefit
(3,610)
-
Share-based payments expense
1,095
1,045
Interest income reclassified to investing activities
(1,705)
(805)
Change in assets and liabilities:
(Increase)/decrease in current receivables
(2,513)
2,012
Increase in financial assets
(2,585)
-
(Increase)/decrease in inventories
(26,053)
28,524
Decrease/(increase) in prepayments
672
(1,863)
Increase/(decrease) in trade and other payables
32,811
(7,096)
Increase in employee benefit provisions
372
98
Decrease in other provisions
(211)
(2,920)
Increase in deferred income
60
9
(Decrease)/increase in other financial liabilities
(2,016)
1,188
Net cash provided by operating activities
52,704
75,041
(ii)
Details of finance facilities are included in note 23 to the consolidated financial statements.
(iii) Movement in financial activities
The following table details changes in the Group’s liabilities arising from financial activities, including both cash and
non-cash changes. Liabilities arising from financing activities are those for which cash flows were, or future cash flows
will be, classified in the Group’s consolidated statement of cash flows as cash flows from financing activities.
CONSOLIDATED
2024
2023
$’000
$’000
Movements in financing activities
Lease liabilities
Opening balance
88,813
94,032
Financing cash flows
(16,458)
(15,817)
New leases
2,770
1,921
Retired or changes to leases
7,803
8,677
Closing balance
82,928
88,813
(iv) Non-cash financing activities
There were no non-cash financing activities other than above during the Financial Year or the 2023 year.
85
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
31 Parent Entity Disclosures
COMPANY
2024
2023
$’000
$’000
Financial position
Assets
Current assets - third parties
321,171
277,783
Total assets
470,967
423,677
Liabilities
Current liabilities - third parties
173,493
139,521
Total liabilities
247,316
220,223
Equity
Issued capital
409,124
424,771
Accumulated losses
(331,839)
(335,250)
Equity-settled compensation reserve
12,417
13,936
Asset revaluation reserve
3,074
3,074
Employee share reserve
(583)
(2,320)
Share buy-back reserve
14,989
5,560
Dividend reserve
116,470
93,683
Total Equity
223,652
203,454
Financial performance
Profit for the year
32,288
31,808
Total comprehensive profit for the year
32,288
31,808
Contingent liabilities of the parent entity
Refer note 27
Commitments for the acquisition of
property, plant and equipment by the parent entity
Commitments for the acquisition of property, plant and equipment by
the parent entity
Within one year
2,278
3,000
In 2023, the parent entity settled a non-interest bearing loan of $500,000 that was advanced from a controlled entity, Austex
Dies Pty Limited. The loan was payable in demand. No additional loan was advanced from Austex in current Financial Year.
In current Financial Year, the parent entity purchased dies amounted to $4,579,362 (2023: $4,700,821) from
Austex Dies Pty Limited.
In 2023, the Company received a dividend of $500,000 from Austex Dies Pty Limited. No dividend was received in the current
Financial Year.
86
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
32 Share-Based Payments
Performance share rights
Executive and senior management
The following share-based payment arrangements were in existence during the current Financial Year:
Performance right series
(LTIP)
Number as at
31 Dec 24
Grant date
Last testing
date
Exercise price
$
Fair value at grant date
$
Issued 8 March 20221
58,250
8/03/2022
31/12/2024
-
4.910
Issued 8 March 20221
58,250
8/03/2022
31/12/2024
-
6.780
Issued 6 March 20232
45,500
6/03/2023
31/12/2025
-
5.090
Issued 6 March 20232
45,500
6/03/2023
31/12/2025
-
6.500
Issued 24 March 20232
18,300
24/03/2023
31/12/2025
-
4.730
Issued 24 March 20232
18,300
24/03/2023
31/12/2025
-
6.160
Issued 22 May 20232
4,500
22/05/2023
31/12/2025
-
4.010
Issued 22 May 20232
4,500
22/05/2023
31/12/2025
-
5.850
Issued 11 March 20243
76,500
11/3/2024
31/12/2026
-
5.360
Issued 11 March 20243
76,500
11/3/2024
31/12/2026
-
7.780
1 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2022 have
an average vesting date of 1 March 2025.
2 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2023 have
an average vesting date of 1 March 2026.
3 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2024 have
an average vesting date of 1 March 2027.
The following share-based payment arrangements were in existence during the comparative reporting period:
Performance right series
(LTIP)
Number as at
31 Dec 23
Grant date
Last testing
date
Exercise price
$
Fair value at grant date
$
Issued 3 March 20211
79,850
3/03/2021
31/12/2023
-
4.180
Issued 3 March 20211
79,850
3/03/2021
31/12/2023
-
5.490
Issued 8 March 20222
62,750
8/03/2022
31/12/2024
-
4.910
Issued 8 March 20222
62,750
8/03/2022
31/12/2024
-
6.780
Issued 6 March 20233
47,750
6/03/2023
31/12/2025
-
5.090
Issued 6 March 20233
47,750
6/03/2023
31/12/2025
-
6.500
Issued 24 March 20233
18,300
24/03/2023
31/12/2025
-
4.730
Issued 24 March 20233
18,300
24/03/2023
31/12/2025
-
6.160
Issued 22 May 20233
4,500
22/05/2023
31/12/2025
-
4.010
Issued 22 May 20233
4,500
22/05/2023
31/12/2025
-
5.850
1 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2021 have
an average vesting date of 1 March 2024.
2 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2022 have
an average vesting date of 1 March 2025.
3 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2023 have
an average vesting date of 1 March 2026.
87
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
32 Share-Based Payments (cont’d)
Performance share rights (Cont’d)
PERFORMANCE RIGHTS (LTIP)
Inputs into the model
11 March
2024
22 May
2023
24 March
2023
06 March
2023
08 March
2022
03 March
2021
Grant date
11/03/2024
22/05/2023
24/03/2023
6/03/2023
8/03/2022
3/03/2021
Dividend yield
6.5%
6.9%
7.0%
7.0%
7.9%
6.5%
Risk free yield
3.59%
3.3%
2.9%
3.5%
1.6%
0.3%
Expected volatility
26%
34%
35%
36%
45%
55%
Last testing date
31/12/2026
31/12/2025
31/12/2025
31/12/2025
31/12/2024
31/12/2023
Exercise price
n.a
n.a
n.a
n.a
n.a
n.a
Share price at grant date
$9.380
$7.040
$7.500
$7.950
$8.570
$6.670
Performance right life
3 years
3 years
3 years
3 years
3 years
3 years
88
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
32 Share-Based Payments (cont’d)
Performance share rights (Cont’d)
Managing Director
During the Financial Year, 47,000 rights were issued to Mr A. Dragicevich.
In 2023, 44,400 rights were issued to Mr A. Dragicevich.
The following rights were in existence during the current Financial Year, subject to the achievement of performance
conditions and have been independently valued as follows:
Performance right series
(LTIP)
Number as at
31 Dec 24
Grant date
Last testing
date
Exercise price
$
Fair value at grant date
$
Issued 27 April 20221
24,500
27/04/2022
31/12/2024
-
$5.820
Issued 27 April 20221
24,500
27/04/2022
31/12/2024
-
$7.770
Issued 27 April 20232
22,200
27/04/2023
31/12/2025
-
$4.250
Issued 27 April 20232
22,200
27/04/2023
31/12/2025
-
$5.940
Issued 8 May 20243
23,500
08/05/2024
31/12/2026
-
$5.430
Issued 8 May 20243
23,500
08/05/2024
31/12/2026
-
$7.950
1 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2022
have an average vesting date of 1 March 2025.
2 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2023
have an average vesting date of 1 March 2026.
3 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2024
have an average vesting date of 1 March 2027.
The following rights were in existence during the comparative reporting period, subject to the achievement of
performance conditions and have been independently valued as follows:
Performance right series
(LTIP)
Number as at
31 Dec 23
Grant date
Last testing
date
Exercise price
$
Fair value at grant date
$
Issued 28 April 20211
43,150
28/04/2021
31/12/2023
-
$5.170
Issued 28 April 20211
43,150
28/04/2021
31/12/2023
-
$6.430
Issued 27 April 20222
24,500
27/04/2022
31/12/2024
-
$5.820
Issued 27 April 20222
24,500
27/04/2022
31/12/2024
-
$7.770
Issued 27 April 20233
22,200
27/04/2023
31/12/2025
-
$4.250
Issued 27 April 20233
22,200
27/04/2023
31/12/2025
-
$5.940
1 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2021
have an average vesting date of 1 March 2024.
2 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2022
have an average vesting date of 1 March 2025.
3 In accordance with the terms of the LTIP arrangement, performance rights issued during the financial year ended 31 December 2023
have an average vesting date of 1 March 2026.
89
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
32 Share-Based Payments (cont’d)
Performance share rights (Cont’d)
Inputs into the model
8 May 2024
27 April 2023
27 April 2022
28 April 2021
Grant date
8/5/2024
27/4/2023
27/4/2022
28/4/2021
Dividend yield
6.6%
6.9%
7.1%
5.8%
Risk free yield
3.95%
3.0%
2.6%
0.3%
Expected volatility
26%
34%
45%
55%
Last testing date
31/12/2026
31/12/2025
31/12/2024
31/12/2023
Share price at grant date
$9.520
$7.190
$9.510
$7.580
Performance right life
3 years
3 years
3 years
3 years
The following table reconciles the outstanding securities granted to the Managing Director and senior management at the
beginning and end of the Financial Year:
Performance rights
2024
2023
Number of share performance rights:
Balance at the beginning of the financial year
606,000
722,320
Granted during the financial year
200,000
185,500
Forfeited during the financial year
(17,500)
(23,500)
Vested during the financial year
(242,000)
(278,320)
Lapsed during the financial year
-
-
Balance at the end of the financial year
546,500
606,000
The performance rights outstanding at the end of the Financial Year were 546,500 (2023: 606,000), with a weighted average
remaining contractual life of 1.06 years.
Short-Term Incentives Plan (STIP)
During the Financial Year, Capral allotted 12,674 (previously bought on-market) ordinary shares to Capral’s Executives and
Senior Management who purchased Capral’s shares by using the STIP target component (stretch) of their 2023 financial year
after-tax STIP. These shares are held in escrow by Capral’s share registry for a period of 3 years.
Accounting policy
Equity-settled share-based payments with employees are measured at the fair value of the equity instrument at the grant date.
The fair value of the performance rights is estimated at grant date using a Monte-Carlo Simulation analysis taking into
account the terms and conditions upon which the securities are granted.
The expected life used in the model has been adjusted, based on management’s best estimate, for the effects of non-
transferability, exercise restrictions, and behavioural considerations.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis
over the vesting period, based on the Group’s estimate of shares that will eventually vest.
90
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
33 Key Management Personnel Compensation
The aggregate compensation made to directors and other members of key management personnel of the Company and the
Group is set out below:
CONSOLIDATED
2024
2023
$
$
Short-term benefits
2,069,904
2,038,079
Post-employment benefits
91,536
97,033
Other long-term benefits
-
-
Termination benefits
-
-
Share-based payments
502,596
575,732
2,664,036
2,710,844
34 Controlled Entities
Particulars in relation to controlled entities
2024
2023
Country of incorporation
%
%
Parent entity
Capral Limited
Contolled entities
Austex Dies Pty Ltd
100
100
Australia
Capral Employees Incentive Shares Trust
n/a
n/a
Australia
Accounting policy
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and the entity controlled
by the Company.
Control is based on whether the Group has:
• power over the investee
• exposure, or rights, to variable returns from its involvement with the investee, and
• the ability to use its power over the investee to affect the amount of the returns.
The results of the subsidiary acquired or disposed of during the year are included in the profit or loss from the effective date
of acquisition or up to the effective date of disposal, as appropriate.
All intra-group transactions, balances, income and expenses are eliminated in full on consolidation.
91
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
35 Business Combinations
(a) Acquisition of assets from Aluminium Trade Centre Pty Ltd ("ATC")
Capral Limited acquired certain assets of the wholesale and retail distribution business from ATC on 22 March 2024 for a
total consideration of $3,181,000.
2024
$’000
Consideration
Cash paid
3,181
Total Consideration
3,181
Acquisition-related costs amounting to $37,000 have been excluded from the consideration transferred. These have been
recognised as an expense in the Financial Year, within the ‘Other expenses’ line item in the consolidated statement of profit or
loss and other comprehensive income.
The acquisition of ATC by Capral strongly boosts Capral’s market presence and enhances its ability to deliver market-leading
service to fabricators and other aluminium product users across Victoria. The ATC business has been seamlessly integrated
into Capral’s operations, strengthening Capral’s national footprint of aluminium distribution outlets.
Fair value of the net identifiable assets acquired and liabilities assumed at the date of acquisition were:
2024
$’000
Current assets
Inventory
1,512
Non-current assets
Fixed assets
360
Right-of-use assets
350
Customer relationships
540
Current liabilities
Lease liabilities
(350)
Total
2,412
Goodwill arising from the acquisition has been recognised as follows
Consideration
3,181
Less: Fair value of net assets acquired
(2,412)
Goodwill
769
92
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
35 Business Combinations (cont’d)
(a) Acquisition of assets from Aluminium Trade Centre Pty Ltd ("ATC") (cont’d)
Fair value measurement
Inventories are valued at cost as these were readily
available stock held by the distributors and Capral could
purchase the same stock from the same supplier at cost.
Fixed assets are valued at the acquired net book value,
which reflects the depreciated replacement cost.
Customer relationships intangible assets have been
valued using the multi-period excess earnings method,
by an independent valuer.
The goodwill of $769,000 arising from the acquisition
consists mostly of the synergies and economies of
scale expected from combining the operations of ATC
and the Group.
Impact of acquisition on the results of the Group
The acquired business contributed a total revenue of
$4,907,000 and a net profit after tax of $162,000 to the
Group for the period from 22 March 2024 to 31 December
2024.
Had the business combination been effected at 1 January
2024, the Group’s total revenue would have been
$650,647,000 and the Group’s total net profit for the year
would have been $32,553,000.
93
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
35 Business Combinations (cont’d)
(b) Acquisition of assets from Apple Aluminium Pty Ltd
Capral acquired certain assets of the aluminium business from Apple Aluminium Pty Ltd on 26 July 2024 for a purchase
price of $3,631,000.
2024
$’000
Consideration
Cash paid
3,631
Total Consideration
3,631
Acquisition-related costs amounting to $217,000 have been excluded from the consideration transferred. These have been
recognised as an expense in the Financial Year, within the ‘Other expenses’ line item in the Consolidated statement of profit or
loss and other comprehensive income.
The Apple Aluminium business acquisition strengthens Capral’s market presence and enhances its ability to deliver market-
leading service to fabricators and other users of aluminium products within Queensland.
Fair value of the net identifiable assets acquired and liabilities assumed at the date of acquisition were:
2024
$’000
Current assets
Inventory
1,851
Non-current assets
Fixed assets
400
Right-of-use assets
366
Customer relationships
520
Current liabilities
Lease liabilities
(366)
Total
2,771
Goodwill arising from the acquisition has been recognised as follows
Consideration
3,631
Less: Fair value of net assets acquired
(2,771)
Goodwill
860
94
Capral Limited — Annual Report 2024
Notes to the Consolidated Financial Statements
35 Business Combinations (cont’d)
(b) Acquisition of assets from Apple Aluminium Pty Ltd (cont’d)
Fair value measurement
Inventories are valued at cost as they were readily available
stock held by the distributors and Capral could purchase the
same stock from the same supplier at cost.
Fixed assets are valued at the acquired net book value, which
reflects the depreciated replacement cost.
Customer relationships assets have been valued using
the multi-period excess earnings method, by an
independent valuer.
The goodwill of $860,000 arising from the acquisition
consists mostly of the synergies and economies of scale
expected from combining the operations of Apple Aluminium
and the Group.
Impact of acquisition on the results of the Group
The acquired business contributed a total revenue of
$3,302,000 and a net profit after tax of $159,000 to the Group
for the period from 26 July 2024 to 31 December 2024.
Had the business combination been effected at
1 January 2024, the Group’s total revenue would have been
$654,897,000 and the Group’s total net profit for the year
would have been $32,813,000.
Accounting policy
The Group accounts for business combinations under
the acquisition method when the acquired set of
activities and assets meets the definition of a business
and control is transferred to the Group. In determining
whether a particular set of activities and assets is a
business, the Group assesses whether the set of assets
and activities acquired includes, at a minimum, an input
and substantive process and whether the acquired set
has the ability to produce outputs.
The consideration transferred in the acquisition is
generally measured at fair value, as are the identifiable
net assets acquired. Any goodwill that arises is tested
annually for impairment (see Note 13). Transaction costs
are expenses as incurred.
95
Capral Limited — Annual Report 2024
Consolidated Entity Disclosure Statement
Name
Body corporate
Country of
incorporation
% of share capital
held directly by
the Company
Country of
tax residence
Jurisdiction
for foreign
tax resident
Parent entity
Capral Limited
Body corporate
Australia
Australia
n/a
Subsidiary
Austex Dies Pty Ltd
Body corporate
Australia
100
Australia
n/a
Capral Employees Incentive
Shares Trust
Trust
Australia
n/a
Australia
n/a
Key assumptions and judgements
Determination of tax residency
Section 295 (3A) of the Corporation Acts 2001 requires that
the tax residency of each entity which is included in the
Consolidated Entity Disclosure Statement (CEDS) be
disclosed. In the context of an entity which was an
Australian resident, “Australian resident” has the meaning
provided in the Income Tax Assessment Act 1997. The
determination of tax residency involves judgment as the
determination of tax residency is highly fact dependent and
there are currently several different interpretations that
could be adopted, and which could give rise to a different
conclusion on residency.
In determining tax residency, the consolidated entity has
applied the following interpretations:
Australian tax residency
The consolidated entity has applied current legislation
and judicial precedent, including having regard to the
Commissioner of Taxation’s public guidance in
Tax Ruling TR 2018/5.
Foreign tax residency
The consolidated entity has applied current legislation
and where available judicial precedent in the
determination of foreign tax residency.
Trusts
Australian tax law does not contain specific residency
tests for trusts. Generally, these entities are taxed on a
flow-through basis so there is no need for a general
residence test. There are some provisions which treat
trusts as residents for certain purposes, but this does
not mean the trust itself is an entity that is subject to
tax. Additional disclosures on the tax status of trusts
have been provided where relevant.
96
Capral Limited — Annual Report 2024
Directors’
Declaration
The directors declare that:
(a)
in the directors’ opinion, there are reasonable grounds to believe that Capral Limited (the “Company”) will be able to
pay its debts as and when they become due and payable;
(b)
in the directors’ opinion, the attached consolidated financial statements and notes thereto and the Remuneration
report in sections 1 to 5 in the directors’ report are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the Group’s financial position as at 31 December 2024 and of its performance for the
financial year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001;
(c)
in the directors’ opinion, the attached consolidated financial statements and notes thereto are in accordance with
International Financial Reporting Standards issued by the International Accounting Standards Board;
(d)
in the directors’ opinion, the Consolidated Entity Disclosure Statement as at 31 December 2024 set out on page 96
is true and correct; and
(e)
the directors have been given declarations required by section 295A of the Corporations Act 2001 from the chief
executive officer and chief financial officer for the financial year ended 31 December 2024.
Signed in accordance with a resolution of the directors made pursuant to section 295(5) of the Corporations Act 2001.
On behalf of the directors
Tony Dragicevich
Managing Director
Mark White
Chairman
Sydney
26 February 2025
97
Capral Limited — Annual Report 2024
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated
with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and
logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by
a scheme approved under Professional Standards Legislation.
Independent Auditor’s Report
To the shareholders of Capral Limited
Report on the audit of the Financial Report
Opinion
We have audited the Financial Report of
Capral Limited (the Company).
In our opinion, the accompanying Financial
Report of the Company gives a true and
fair view, including of the Group’s
financial position as at 31 December 2024
and of its financial performance for the
year then ended, in accordance with the
Corporations Act 2001, in compliance with
Australian Accounting Standards and the
Corporations Regulations 2001
The Financial Report comprises:
•
Consolidated statement of financial position as at 31
December 2024;
•
Consolidated statement of profit or loss and other
comprehensive income, Consolidated statement of
changes in equity, and Consolidated statement of
cash flows for the year then ended;
•
Consolidated entity disclosure statement and
accompanying basis of preparation as at 31
December 2024;
•
Notes, including material accounting policies; and
•
Directors’ Declaration.
The Group consists of the Company and the entities it
controlled at the year end or from time to time during
the financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for
the audit of the Financial Report section of our report.
We are independent of the Group in accordance with the Corporations Act 2001 and the ethical
requirements of the Accounting Professional and 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 fulfilled our other ethical responsibilities in
accordance with these requirements.
74
98
Capral Limited — Annual Report 2024
Key Audit Matters
The Key Audit Matters we identified are:
•
Impairment of non-financial assets;
and
•
Recognition and recoverability of
deferred tax assets.
Key Audit Matters are those matters that, in our
professional judgement, were of most significance in
our audit of the Financial Report of the current period.
These matters were addressed in the context of our
audit of the Financial Report as a whole, and in forming
our opinion thereon, and we do not provide a separate
opinion on these matters.
Impairment of non- financial assets
Refer to Note 11 to the Financial Report
The key audit matter
How the matter was addressed in our audit
A key audit matter for us was the Group’s
annual testing of non-financial assets for
impairment, given the size of the balance and
the judgement involved in determining the key
forward-looking assumptions the Group applied
in their value in use model, including:
•
forecast cash flows – there is uncertainty
due to volatile economic conditions and the
corresponding impact on residential,
commercial construction and industrial
sectors as well as metal input pricing. This
impacted the Group through updated
expectations in the demand for products,
metal input pricing and customer pricing
and margin. These conditions increase the
possibility of non-financial assets being
impaired, plus the risk of inaccurate
forecasts or a wider range of possible
outcomes for us to consider.
•
terminal growth rates – in addition to the
uncertainties described above, the Group’s
model is sensitive to changes in these
assumptions, reducing available headroom.
This drives additional audit effort specific to
their feasibility and consistency of
application to the Group’s strategy.
•
discount rate - these are complicated in
nature and vary according to the conditions
and environment the Cash Generating Unit
(CGU) is subject to from time to time. The
Group’s modelling is highly sensitive to
Our procedures included:
•
We considered the appropriateness of the
value in use method applied by the Group to
perform impairment testing against the
requirements of the accounting standards.
•
Working with our valuation specialists, we
assessed the integrity of the value in use
model used, including the accuracy of the
underlying calculation formulas.
•
We considered the Group’s determination of
its CGU based on our understanding of the
Group’s business and how independent cash
inflows were generated against the
requirements of the Australian Accounting
Standards.
•
We compared the forecast cash flows
contained in the value in use model to Board-
approved forecasts.
•
We challenged the Group’s key forward
looking assumptions in light of the expected
continuation of volatile economic conditions.
We assessed how the Group considered the
impacts of these key events in the Board
approved plan and strategy. We compared
forecast growth rates to published studies of
industry trends and expectations, and
considered differences for the Group’s
operations. We used our knowledge of the
Group, their past performance, business and
75
Independent Auditor’s Report
99
Capral Limited — Annual Report 2024
small changes in the discount rate.
The Group uses a value in use model to
perform their annual testing of non-financial
assets for impairment. The model is largely
manually developed, uses adjusted historical
performance, and a range of internal and
external sources as inputs to the assumptions.
The modelling, using forward-looking
assumptions tends to be prone to greater risk
for potential bias, error and inconsistent
application. These conditions necessitate
additional scrutiny by us, in particular to address
the objectivity of sources used for assumptions,
and their consistent application.
The Group operates in a number of regional
areas across Australia necessitating our
consideration of the Group’s determination of
CGUs, based on the smallest group of assets to
generate largely independent cash inflows.
We involved valuation specialists to supplement
our senior audit team members in assessing
this key audit matter.
customers, and our industry experience.
•
We checked the consistency of the growth
rates to the Group’s latest Board-approved
forecast, past performance of the Group, and
our experience regarding the feasibility of
these in the industry and economic
environment in which the Group operates.
•
Working with our valuation specialists, we
independently developed a discount rate range
considered comparable using publicly available
market data for comparable entities, adjusted
by risk factors specific to the Group and the
industry it operates in.
•
Working with our valuation specialists, we
independently developed a terminal growth
rate range considered comparable using
publicly available market data for comparable
entities.
•
We considered the sensitivity of the model by
varying key assumptions, such as forecast
growth rates and discount rate, within a
reasonably possible range. We considered the
interdependencies of key assumptions when
performing the sensitivity analysis and what
the Group considers to be reasonable. We did
this to identify those assumptions at higher
risk of bias or inconsistency in application and
to focus our further procedures.
•
We assessed the disclosures in the financial
report using our understanding obtained from
our testing and against the requirements of
the accounting standards.
76
Independent Auditor’s Report
100
Capral Limited — Annual Report 2024
Recognition and recoverability of deferred tax assets ($27.3 million)
Refer to Note 9 to the Financial Report
The key audit matter
How the matter was addressed in our audit
The Group’s deferred tax assets includes tax
losses carried forward and temporary
differences.
Under accounting standards, the Group can only
recognise deferred tax assets if certain
conditions prescribed by Australian tax law are
satisfied, and if it is probable that the Group will
generate sufficient taxable profits in the future in
order for the benefits of the deferred tax assets
to be realised.
The recognition and recoverability of deferred tax
assets was a key audit matter for us due to:
•
The significant judgment required in
evaluating the Group’s assessment of
satisfying conditions under Australian tax law
that gives rise to the availability of tax losses.
The Group engaged external experts to
assist with this evaluation.
•
The significant judgement involved in
evaluating the Group’s assessment of the
probability of generating sufficient future
taxable profits.
•
The risk of the Group incorrectly applying the
requirements of the accounting standards
and Australian tax law to recognise deferred
tax assets for tax losses, which could have a
significant effect on the Group’s
consolidated statement of profit or loss and
other comprehensive income.
We involved tax specialists to supplement our
senior team members in assessing this key audit
matter.
Our procedures included:
•
Working with our tax specialists, we:
−
assessed the scope, competence and
objectivity of the external experts
engaged by the Group to assist with the
assessment of the recognition of the
deferred tax assets.
−
Examined the reports and
documentation prepared by the external
experts and the Group underlying the
availability of tax losses for consistency
with Australian tax law.
−
Checked the key inputs to the Group’s
external expert reports, Group’s data
and publicly available information.
−
evaluated the methodology used to
determine the availability of tax losses,
considering Australian tax law.
•
We compared the forecast cash flow
included in the Group’s estimate of future
taxable profits used in their deferred tax
assets recoverability assessment to that
used in the Group’s assessment of the
recoverability of its non-financial assets. Our
approach to testing the forecast cash flows
was consistent with the approach detailed in
the key audit matter above.
•
We challenged the differences between
forecast cash flows and taxable profit by
evaluating the adjustment of cash flows, for
differences between accounting profits, as
presented in the Group’s forecasts, to
taxable profits, against the requirements of
the applicable Australian tax law.
•
We assessed the expected timing of future
taxable profits using our knowledge of the
business and its plans. We placed increased
scepticism where a longer timeframe of
recovery was expected.
•
We assessed the disclosures in the financial
report using the results from our testing and
against the requirements of the accounting
standards.
77
Independent Auditor’s Report
101
Capral Limited — Annual Report 2024
Other Information
Other Information is financial and non-financial information in Capral Limited’s annual report which is
provided in addition to the Financial Report and the Auditor's Report. The Directors are responsible
for the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not
express an audit opinion or any form of assurance conclusion thereon, with the exception of the
Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other
Information. In doing so, we 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.
We are required to report if we conclude that there is a material misstatement of this Other
Information, and based on the work we have performed on the Other Information that we obtained
prior to the date of this Auditor’s Report we have nothing to report.
Responsibilities of the Directors for the Financial Report
The Directors are responsible for:
•
preparing the Financial Report in accordance with the Corporations Act 2001, including giving
a true and fair view of the financial position and performance of the Group, and in compliance
with Australian Accounting Standards and the Corporations Regulations 2001
•
implementing necessary internal control to enable the preparation of a Financial Report in
accordance with the Corporations Act 2001, including giving a true and fair view of the
financial position and performance of the Group, and that is free from material misstatement,
whether due to fraud or error
•
assessing the Group and Company’s ability to continue as a going concern and whether the
use of the going concern basis of accounting is appropriate. This includes disclosing, as
applicable, matters related to going concern and using the going concern basis of accounting
unless they either intend to liquidate the Group and Company or to cease operations, or have
no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
•
to obtain reasonable assurance about whether the Financial Report as a whole is free from
material misstatement, whether due to fraud or error; and
•
to issue an Auditor’s Report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with Australian Auditing Standards will always detect a material misstatement when it
exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/media/bwvjcgre/ar1_2024.pdf. This description forms part of our
Auditor’s Report.
78
Independent Auditor’s Report
102
Capral Limited — Annual Report 2024
Report on the Remuneration Report
Opinion
In our opinion, the Remuneration Report
of Capral Limited for the year ended 31
December 2024, complies with Section
300A of the Corporations Act 2001.
Directors’ responsibilities
The Directors of the Company are responsible for the
preparation and presentation of the Remuneration
Report in accordance with Section 300A of the
Corporations Act 2001.
Our responsibilities
We have audited the Remuneration Report included in
pages 25-40 of the Directors’ report for the year ended
31 December 2024.
Our responsibility is to express an opinion as to whether
the Remuneration Report complies in all material
respects with Section 300A of the Corporations Act
2001, based on our audit conducted in accordance with
Australian Auditing Standards.
KPMG
Daniel Camilleri
Partner
Sydney
26 February 2025
79
Independent Auditor’s Report
103
Capral Limited — Annual Report 2024
Member
Details
Top holders (grouped) as of 28/02/24
1
Twenty Largest Holders
Details of Capral’s twenty largest shareholders were as follows:
Rank
Name
Units
Unit %
1
CITICORP NOMINEES PTY LTD
2,684,910
15.76
2
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
2,584,155
15.17
3
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
1,579,111
9.27
4
PRUDENTIAL NOMINEES PTY LTD
1,540,000
9.04
5
NATIONAL EXCHANGE PTY LTD
700,000
4.11
6
MR ANTHONY MATTHEW DRAGICEVICH
424,971
2.49
7
BNP PARIBAS NOMINEES PTY LTD
196,424
1.15
8
MR ANDREW ROY NEWBERY SISSON
163,000
0.96
9
RAVENSCOURT PROPRIETARY LIMITED
150,000
0.88
10
AGO PTY LTD
144,950
0.85
11
BNP PARIBAS NOMINEES PTY LTD
138,358
0.81
12
MR JOHN GEORGE WHITING + MRS DIANA PATRICIA WHITING
133,334
0.78
13
CAPRAL LIMITED
132,853
0.78
14
MR ANTHONY MATTHEW DRAGICEVICH
126,619
0.74
15
ANCHORFIELD PTY LTD
121,341
0.71
16
MRS ANTONIA CAROLINE COLLOPY
120,747
0.71
17
SOUTHERN STEEL INVESTMENTS PTY LIMITED
114,820
0.67
18
MRS GLENDA CLAIRE ORGILL
97,292
0.57
19
MR JORIS ARJEN LUGTENBURG + MRS ADRIANE LUGTENBURG
92,498
0.54
20
DEBUSCEY PTY LTD
91,687
0.54
Totals: Top 20 holders of ORDINARY FULLY PAID SHARES (Total)
11,337,070
66.56
Total Remaining Holders Balance
5,696,115
33.44
104
Capral Limited — Annual Report 2024
2
Substantial Shareholders
Substantial shareholders as notified to Capral in accordance with the Corporations Act 2001:
Name
Number of shares
% of shares held
as notified on
Allan Gray Australia PTY LTD
4,042,832
23.31
01/07/2024
National Exchange Pty Ltd
2,100,000
11.86
20/12/2023
Perpetual Limited
1,219,418
6.99
21/06/2024
Total
7,362,250
42.16
3
Number of holders
a) Quoted equity securities: There were 2,249 holders of ordinary shares.
b) Unquoted equity securities – options: There were Nil unquoted options.
c) Unquoted equity securities – performance rights: There were 546,500 unquoted performance rights issued to 23 holders
under the Capral Long Term Incentive Plan. There is 1 holder who holds 20% or more performance rights under this plan.
4
Voting Rights
d) Voting rights attaching to the fully paid ordinary shares are, on a show of hands, one vote per person present as a
member proxy, attorney, or representative thereof and on a poll, one vote per share for every member present in person or
by proxy or by attorney or by representative.
e) Holders of options and performance rights do not have any voting rights on the equity securities held by them. Ordinary
shares issued on exercise of options or vesting of performance rights will carry the same voting rights as all other fully
paid ordinary shares of Capral.
Member Details
105
Capral Limited — Annual Report 2024
5
Distribution of Equity Securities
(a) Quoted ordinary shares
Name
Number of holders
1 – 1,000
1,454
1,001 – 5,000
548
5,001 – 10,000
115
10,001 – 100,000
113
100,001 and over
19
Total
2,249
(b) Unquoted performance rights
Range of Shares
Number of holders
1 – 1,000
0
1,001 – 5,000
1
5,001 – 10,000
5
10,001 – 100,000
16
100,001 and over
1
Total
23
6
Marketable parcels
The number of shareholders holding less than a marketable parcel* of shares is 334 holders.
* Minimum parcel size of shares: 49
7
On-market buy back
A further on-market buy-back for up to 10% of issued shares to commence on or after 3 March 2025.
Member Details
106
Capral Limited — Annual Report 2024
Corporate
Directory
Capral's Registered Office
71 Ashburn Road
Bundamba QLD 4304
Telephone +61 (07) 3816 7000
Fax +61 (07) 3816 7111
Capral's Principal Administration Office/
Investor Enquiries
15 Huntingwood Drive
Huntingwood NSW 2148
Telephone +61 (02) 9682 0710
Email InvestorRelations@capral.com.au
Share Registry
Computershare Investor Services Pty Limited
ABN 48 078 279 277
Level 3, 60 Carrington Street
Sydney NSW 2000
Telephone 1300 855 080
Auditor
KPMG
ABN 51 194 660 183
Level 38 Tower Three
300 Barangaroo Avenue
Sydney NSW 2000
Securities Exchange Listing
Capral’s shares are quoted on the Australian Securities Exchange
(Code: CAA).
Company Secretary
Mr T Campbell (Joint)
Ms L Osbich (Joint)
Corporate Governance Statement
capral.com.au/investor-centre/
107
Capral Limited — Annual Report 2024
CAPRAL LIMITED
ABN 78 004 213 692
71 ASHBURN RD,
BUNDAMBA QLD 4304
TEL 07 3816 7000
FAX 07 3816 7111
CAPRAL.COM.AU