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Annual Report 2017
Our Strategic Pillars
Our purpose:
to build and improve the performance
of athletes and sporting teams.
What do we do?
we create technology to help athletes
and teams fulfil their true potential.
leveRAge
elite intO
pROsumeR
> target prosumer
market with a
dedicated offer
> elevate the
catapult brand
cOmmeRciAlise
elite weARAble
And videO dAtA
> explore avenues
to generate
incremental
income from elite
performance data
Own the
peRfORmAnce
technOlOgy
stAck fOR
elite spORt
> Aggressively
grow share
in elite sport
globally
> maximise and
deepen elite
customer
relationships
> extend elite
product leadership
Organisational
excellence
we have codified catapult’s purposes and values
to drive continued organisational excellence
as catapult’s business scales globally
Catapult Group International Limited Annual Report 2017
1
Key Achievements in FY17
Contents
2
letter from the
chairman and ceO
4
Review of Operations
18
directors’ Report
41
consolidated financial
statements
101
directors’ declaration
102
independent Auditor’s
Report
107
AsX Additional
information
IBC
corporate
directory
01.
continued strong growth
of elite wearables
> 52% yoy elite wearables revenue
growth in fy17 to $26.4m
(vs $17.4m in fy16)
02.
03.
taking XOs to double digit growth
> pro-forma XOs revenue growth
of 10.4% in fy17 (vs 3.6% in fy16)
first year of positive underlying
ebitdA
> $2.9m of underlying ebitdA in fy17,
catapult’s first positive underlying
ebitdA result since listing on the
AsX in december 2014
04.
strategic acquisitions
> XOS: compelling combination bringing
together market leaders in wearables
and video tech for elite teams
> PLAYERTEK: proven, commercialised
solution accelerating catapult’s
entry into prosumer market
> AMS: parent layers Ams product
widening the scope of catapult’s
analytics offering and tech stack
across elite and prosumer
05.
06.
07.
validated data
commercialisation model
and delivered key learnings
continued R&d
delivering significant
product enhancement
laying down
prosumer
foundations
2
Letter from the Chairman and CEO
Dear Shareholders,
On behalf of your Board of
Directors, it is our pleasure to
present the Catapult Group
International Ltd Annual
Report for the financial year
ended 30 June 2017 (FY17).
fy17 has been a truly
transformational year in both
scale and scope for catapult. we
have grown both organically and
through targeted acquisitions to
become a leading global provider
of technology platforms that
improve sports performance.
OuR PuRPOSE AnD StRAtEGY
catapult is now a global team
of over 300 people, and in fy17
we codified our purpose and
values, and a key focus of ours
into fy18 and beyond will be to
drive organisational excellence as
catapult’s business scales globally.
Our purpose as an organisation
is to build and improve the
performance of athletes and
sporting teams, and we’re proud
to be able to say that we executed
on that vision in fy17.
we believe in our strategy, and will
continue to execute in line with
our three strategic pillars—owning
the performance technology
stack for elite sport, leveraging
that elite dominance into the
prosumer market and looking to
commercialise our elite wearable
and video data.
tEChnOLOGY FOR
ELItE SPORtS
Our elite hardware and software
products have evolved from a
wearable offering in fy16 to an
integrated technology stack in
fy17 now positioned to capture
data and deliver insights across
a wide range of club data sources.
in August 2016, we acquired XOs
technologies, inc. – a us-based
market leader in providing digital
and video analytics software
solutions to elite sports teams
in the united states. this
acquisition both transformed the
financial scale of the business and
strategically brought together the
two key performance technology
components in elite sporting
club environments, deepening
our elite customer relationships
and extending our elite sports
technology product leadership.
in August 2017, we also completed
the acquisition of the sportsmed
elite and baseline athlete
management system (Ams)
businesses from smg technologies
pty ltd. the addition of an
Ams platform to our offering is
highly strategic, and will enable
the expansion of the analytics
catapult can deliver to teams,
using multiple data sources to
deliver better outcomes for our
clients and incremental commercial
opportunities for the group.
we estimate that the
addressable market for our
integrated technology stack
(across wearables, video and
Ams) is $450m–$550m of
annual revenue. As a category
leader, we are very well
positioned to win this market
through our existing sales
and marketing network.
encouragingly, the elite market
opportunity continues to
grow. we validated our data
commercialisation model in fy17,
overlaying broadcast data in the
state of Origin and Afl finals
series, in the process establishing
an exciting showcase for leagues
around the world. we also recently
flagged our intention to develop
a tactical analytics module
that will leverage our existing
wearable and video platforms
and equip coaches with a more
data-science driven approach
to tactical coaching. tactical
analytics is another compelling
product and market expansion
opportunity, and we’re taking a
measured approach to investing
in the development of what we
think is an emerging but soon
to be essential part of the elite
technology stack.
PROSumER
we also acquired plAyeRtek
in August 2016, signalling our
intention to move into the
‘prosumer’ market, which
extends to serious athletes
at junior clubs, and sub-elite
and semi-professional athletes.
we estimate there are 10 to 20
times more ‘prosumer’ teams
globally as compared with the elite
market, and we made a measured
investment in fy17 to prove out
this opportunity. we re-launched
plAyeRtek as PLAYERTEK
by Catapult in April, having
re-engineered the product’s
software layer and developed
new and consumer-facing sales
channels. we saw early promising
signs following our relaunch,
with Q4 prosumer sales (post-
relaunch) exceeding sales in Q1-Q3
combined by 1.8x. we’ve tested a
Catapult Group International Limited Annual Report 2017
3
On behalf of the board, we would
also like to thank shaun holthouse
for his enormous contribution to
catapult in his capacity as ceO.
shaun has been instrumental in
driving the success of the business
to date, and his thoughtful long-
term strategic vision has been
a key contributor to our market
dominance. we look forward to
his ongoing involvement as head
of strategy where he will continue
to be key leader and driver of
catapult’s culture.
finally, the board wishes to thank
and acknowledge the continued
support of our new and existing
shareholders, staff, and customers.
Regards,
Adir shiffman
executive chairman
Joe powell
chief executive Officer
number of ideas and assumptions
about the market this year, and
learnt a lot.
we’re truly excited about what’s
to come in this space, and we’re
in a great position to attack this
new and expanded addressable
market once we release our next-
generation prosumer product
later in fy18.
FY17 RESuLt
Alongside this transformational
backdrop, we are proud to have
delivered another outstanding
year of growth for our shareholders,
with statutory revenue up 249%
to $60.8m, to $60.8m, delivering
$2.9m of underling ebitdA, our
first year of positive underlying
ebitdA since our ipO. Our core
elite wearables business continued
to grow strongly, delivering $26.4m
in revenue, up 52% from last
year. in addition, the successful
integration of XOs into the
broader group saw it return
pro-forma revenue growth
of 10.4% in fy17, up from 3.6%
last year.
OutLOOK
As a business, we operate at the
exciting intersection of technology
and sport. catapult is uniquely
positioned to grow and win our
market by ensuring we leverage
our engaged global team and
deep customer relationships to
execute on our strategy. we’re
thrilled to be part of a high growth
global business with a terrific
purpose, clear strategy, market-
leading technology, trusted and
inspiring brands, very capable
people, and numerous growth
opportunities still ahead of us.
4
Review
of Operations
A summary of catapult group international ltd’s (catapult, or the company) consolidated results is set
out below.
the financial year to 30 June 2017 (fy17) has been a transformational one for catapult, both financially
and operationally. this is a direct result of the company executing clearly on its strategic pillars consisting of
i) owning the elite technology stack for elite team sport ii) leveraging the halo effect from our elite business
into the prosumer market and iii) developing new wearable and video data commercialisation opportunities
for elite sport.
we are taking a measured approach to investing across these strategic pillars to cement our leadership
in these core markets and further enhance our long-term growth prospects.
fy17 was another record result for catapult financially. the company achieved a statutory revenue result
of $60.8m, up 249% on fy16 and was within the revenue guidance range set by management at our Annual
general meeting in november 2016.
FY17 GROuP FInAnCIAL hIGhLIGhtS
subscription & services revenue
capital revenue
Other revenue
Total revenue
statutory ebitdA
Underlying EBITDA
statutory net loss after tax
FY17
$m
43.0
17.2
0.6
60.8
(3.7)
2.9
(13.6)
FY16
$m
YoY
change
9.2
8.1
0.1
17.4
(6.8)
(4.4)
(5.9)
368%
112%
860%
249%
44%
↑
(131)%
the strong revenue growth was almost entirely driven by our elite wearables and elite video businesses.
furthermore, over 70% of fy17 total revenue was generated from long-term client subscriptions and
services, up 368% on fy16 to $43.0m. subscription and services revenue included $15.4m of elite wearable
subscription revenues in fy17, up 67% on fy16, with the remainder made of up elite video subscriptions,
product support and maintenance revenue, plus elite video content licensing. capital (or one-off) revenue
includes revenue from both elite wearable sales and elite video hardware and storages sales, with elite
video capital revenue derived from new and existing subscription clients.
Catapult Group International Limited Annual Report 2017
5
Group annual recurring revenue1
underlying EBItDA
A$m
50.0
40.0
30.0
20.0
10.0
0.0
2.7
46.1
13.5
7.3
A$m
3.0
2.0
1.0
0.0
(1.0)
(2.0)
(3.0)
(4.0)
(5.0)
2.9
(0.9)
(2.5)
(4.4)
30 June 14
30 June 15
30 June 16
30 June 17
FY14
FY15
FY16
FY17
1.
Annual recurring revenue = Monthly recurring revenue x 12.
Our continued focus on building a long-term subscription-based business has resulted in the group’s annual
recurring revenue increasing 241% in the twelve months to 30 June 2017 to $46.1m. furthermore, our
measured approach to investing ensured the group also delivered $2.9m of underlying ebitdA in fy17,
our first positive underlying ebitdA result since listing on the AsX in december 2014.
DELIvERInG An ExPAnDED PRODuCt OFFERInG ACROSS OuR tWO KEY mARKEtS:
ELItE AnD PROSumER
in fy17 the company has transformed into a global leader in the provision of athlete performance technology
solutions to elite teams, a partner to professional sporting leagues with commercialisation of wearable and
video data, and a newly-formed provider of wearable tracking solutions to prosumer teams.
FY16
FY17
FY18
> Elite wearable
market leader and
category pioneer
> XOS acquired
> PLAYERTEK acquired
> PLAYERTEK by Catapult
launched
> Data commercialisation
validated
> AMS acquired
> Full prosumer release
> Tactical analytics
development
6
Review of Operations
EStABLIShInG GLOBAL SCALE
Our world-class team remains focused on driving continued product innovation and operational
improvements in-line with our core purpose – to create technology to help athletes and teams perform
to their true potential.
131 EMPLOYEES
NORTH AMERICA
66 EMPLOYEES
EMEA & ROW
108 EMPLOYEES
APAC
Hub offices
> Melbourne, Aus
> Boston, USA
> Chicago, USA
> London, UK
> Leeds, UK
300+ EMPLOYEES
(vs 125 a year ago)
Catapult Group International Limited Annual Report 2017
7
ELItE
Integrated technology stack for elite sport
the group made significant progress expanding its technology stack for elite through both organic product
development and targeted acquisitions in fy17.
Expanded value
proposition
Market leader
in training
performance
data
Game-day
performance
and broadcast
data and video
Advanced club
administration
and comms
platform
Expanded into
off-pitch data
aggregation
and analytics
Elite
Wearables
Other
tech stack
expansion
Elite
Video
> 2nd key technology pillar
in elite club environments
> Opportunity to integrate
player performance data
analytics and video analytics
AMS
> Parent-layer application
> Brings together on-pitch
and off-pitch data sources
> Centralised data
management system
> 1st key technology pillar
in elite club environments
> Market leader and
category pioneer
> Tactical analytics
> Other data
commercialisation
opportunities
the result is a unique offering to elite teams that is a true point of differentiation to our competitors,
allowing us to continue driving deeper engagement with our client base of over 1,500 elite teams globally.
8
Review of Operations
Large elite recurring revenue opportunity
During FY17, we undertook an important review of our addressable market for Elite teams, with the in-depth
study conservatively identifying 10,000 Elite teams with a combined annual recurring revenue opportunity
of between $450m–$550m.
Growing addressable market
$450m –$550m2
Future revenue
growth
AMS
Wearables
Data monetisation (commenced)
Analytics add-ons (scoping)
Tactical analytics (scoping)
Other technology stack
expansion opportunities
Video
2. Management estimate.
As the clear category leader, we are very well positioned to win this market through our existing sales
and marketing network and further expand our addressable market opportunity through a number of key
initiatives in development, such as i) data monetisation ii) tactical analytics and iii) other analytics add-ons
to our elite technology stack.
Catapult Group International Limited Annual Report 2017
9
(1) Wearables
Our elite wearables business continues to grow strongly, with revenue up 52% to $26.4m. fy17 saw a continued
increase in our recurring revenue base, with 62% of this year’s all-time high of 9,712 elite unit sales on subscription,
supporting the 58% increase in our subscription fleet to 13,780 units.
Elite wearable revenue
Elite wearables subscription base
Capital
Subscription
90% CAGR
26.4
42%
58%
17.3
47%
53%
11.2
55%
45%
A$m
30.0
25.0
20.0
15.0
10.0
5.0
0.0
3.87
48%
52%
FY14
13,780
Units
15,000
10,000
8,749
5,000
4,447
FY15
FY16
FY17
FY15
FY16
FY17
0
based on management’s market sizing estimates, the elite wearables market remains significantly
underpenetrated, with our marketing leading c. 1,200 elite wearable clients accounting for only 12%
of the current addressable market.
10
Review of Operations
(2) Elite Video
xOS pro-forma revenue3
On 13 July 2016, catapult agreed to acquire 100%
of XOs technologies, inc., for us$60m. XOs is the
us-based market leader in providing innovative
digital and video analytic software solutions to elite
sports teams in the united states. the acquisition
brought together the market leaders of elite wearable
and video technology, the two key technology pillars
in elite club environments, and has transformed the
scope and scale of the group.
the successful integration of XOs into the group
saw its top-line revenue growth accelerate to 10.5%
in fy17 (vs 3.6% in fy16) on a pro-forma basis, with
our combined north American sales team growing
our elite video client base to c.430.
Our elite video clients account for only 4.3% of our
current addressable market, based on management
estimates, highlighting the growth opportunity
available as we look to internationalise XOs’s
current client mix.
XOS Product Family
37.2
32.6
33.7
A$m
40.0
35.0
30.0
25.0
20.0
15.0
FY15
FY16
FY17
3. Pro-forma basis, based on XOS management financials.
FY17 includes XOS revenue from 1 July 2017. Converted
to AUD on a constant currency basis (AUD:USD 0.75).
ThunderCloud
ThunderHD
ThunderRadar
Synchronises video analysis
to the cloud for sharing,
remote access and security
On premises high definition video
analysis and editing system that
transforms data to game analysis
Integrates player performance
metrics with video for coaches to
visualise players’ paths instantaneously
ThunderCloud
Playbook
Thunder
CloudScout
ThunderVR
Integrates documents, game video,
coach annotations and voiceover features;
designed to replace the traditional binder
Provides digital boards with player
data points to streamline scouting
and recruitment process
Uses 360-degree virtual reality simulations of
realistic game situations and training modules as
a coaching, marketing and player scouting tool
Catapult Group International Limited Annual Report 2017
11
(3) AMS and Tactical Analytics investments
the group acquired the sportsmed elite and baseline athlete management system (Ams) products from
smg technologies pty ltd (smg) for $1.9m in upfront cash consideration in August 2017. An additional $0.25m
of cash and $0.25m of cAt scrip is payable to smg subject to performance hurdles relating to the successful
transfer and transition of the products to catapult. up to an additional $2m of deferred cash consideration
is also payable over the next 2 years on incremental revenue generated from catapult Ams sales.
Ams by catapult is a saas, modularised, cloud-based platform that acts as a store of team data and
information. Ams has the potential to become catapult’s analytics parent layer application, helping sporting
organisations make better and more informed decisions utilising insights generated from their varied and
often disparate data sources.
strategic rationale of the Ams acquisition:
> capability to provide teams with a centralised data repository and analytics platform across a wide
range of club data sources;
>
incremental subscription revenue opportunity by selling to catapult’s existing client base;
> potential to act as a key touch point for new clients to introduce them to catapult’s family of products;
> enables the storage of, and access to, broader data streams to feed advanced algorithms;
> Acquisition delivers new clients and a compelling cross-sell opportunity in key target markets.
On-pitch data
Off-pitch data
Elite
Wearables
Elite
Video
Medical
Strength &
conditioning
Wellness
Team
management
Data Sources
Data Sources
tactical analytics is a planned product expansion that leverages our existing wearable and video platforms
to equip coaches with a more data-science driven approach to key tactical considerations.
the funding required to develop and commercialise both Ams and tactical Analytics was secured as part
of our last capital raising in may 2017.
12
Review of Operations
COmmERCIALISE ELItE WEARABLE AnD vIDEO DAtA
in fy17 we validated our data commercialisation model, overlaying live data on broadcast feeds in the nbl,
nRl state of Origin series and Afl finals series, and providing select statistics directly to fans through
the Afl live App.
we have deep experience partnering with sporting leagues, and this demonstrates our ability to generate
new revenue streams from our data via the adjacent ‘sponsorship’ revenue wallet by leveraging the
relationships leagues have with their broadcast partners and sponsors.
these examples are an exciting showcase that catapult can take to leagues around the world.
Above: catapult data overlaid on live broadcast and
published via social media channels, from the 2017
state of Origin series (Rugby league).
Right: catapult data provided directly to fans
through the Afl live Official App.
Catapult Group International Limited Annual Report 2017
13
nInE LEAGuE WIDE DEALS ACROSS WEARABLES AnD vIDEO
18/18 clubs plus
development program
data commercialisation
framework
wallabies
All Australian super Rugby teams
Academy and under 20’s
mens and womens sevens
data commercialisation
framework
womens us national team
10 league teams
youth teams
national mens team
(test, Odi, and t20)
and womens team
All state teams (sheffield shield,
matador cup)
5 county teams
4 national team squads
data commercialisation
framework
8/8 clubs
data commercialisation
framework
Argentina’s
liga nacional de basquetbol
20/20 teams
welsh Rugby union
9 teams, including international
and regional sides
31/31 teams
catapult’s first video-based
league-wide deal
14
Review of Operations
CLEARSKY – REvOLutIOnISInG PLAYER mOnItORInG
Our clearsky technology is a key component to our data commercialisation model. Rather than operating
via satellites like a traditional gps system, clearsky relies on nodes placed around sporting venues, improving
positional accuracy to under 10cm and allowing positional data to be collected in indoor stadiums.
Select ClearSky installations:
Catapult Group International Limited Annual Report 2017
15
PROSumER
1. MARKET OPPORTUNITY
we believe the prosumer market could be 10x – 20x the size of the elite wearable market, in terms
of number of teams. leveraging our authentic elite sport brand, list of clients, and access to scalable
content, catapult is uniquely positioned to go after what is an un-addressed sub-elite market for
wearable devices in team-based sports.
2. ACQUISITION AND REDEVELOPMENT OF PLAYERTEK
catapult acquired 100% of kodaplay limited (plAyeRtek) in August 2016. based in ireland, plAyeRtek had
developed a wearable analytics product primarily targeted to amateur footballers and clubs/organisations.
in April 2017, the group announced a major upgrade of its prosumer offering, releasing PLAYERTEK by Catapult.
the upgrade re-engineered and enhanced the plAyeRtek analytics software, unveiling new features including
the ability for users to compare their performance to professionals. the launch of PLAYERTEK by Catapult
also saw significant business process improvements, establishing a direct-to-consumer sales channel, as well
as scalable supply chain and logistics enhancements.
16
Review of Operations
3. OPERATIONAL HIGHLIGHTS
step change in sales following the PLAYERTEK by Catapult relaunch in April 2017, with 1.8x more sales in the
fourth quarter than in the first three quarter of fy17 combined.
plAyeRtek units sold
4.
ROADMAP AND NEXT STEPS
Q1 – Q3 FY17
Q4 FY17
1,379
2,524
catapult is targeting full launch of its next generation prosumer product later in fy18.
Aug 16
Apr 17
FY17
FY18
PLAYERTEK
acquired
PLAYERTEK by
Catapult launched
Team and
platform build-out
> proven low-cost,
commercialised
solution
> platform to
spearhead entry
into prosumer
market
> proven hardware
wearable and
re-engineered
software
> new sales channels
> transition to new
manufacturing
supply chain, 3pl
established to
support scale
>
investment in
marketing and
sales platform
to unlock nascent
brand equity and
educate market
> scale back-end
systems to support
prosumer economics
Full prosumer
product release
> targeted
fy18 release
Catapult Group International Limited Annual Report 2017
17
COntEntS
directors’ Report
Auditor’s independence declaration
consolidated statement of profit or loss
consolidated statement of Other comprehensive income
consolidated statement of financial position
consolidated statement of changes in equity
consolidated statement of cashflows
notes to the consolidated financial statements
directors’ declaration
independent Auditor’s Report
AsX Additional information
corporate directory
18
40
41
42
43
44
45
46
101
102
107
IBC
18
Directors’ Report
for the year ended 30 June 2017
the directors of catapult group international ltd (‘catapult’) present their Report together with the
financial statements of the consolidated entity, being catapult group international ltd (‘the company’)
and its controlled entities (‘the group’) for the year ended 30 June 2017 (‘fy17’).
DIRECtOR DEtAILS
the following persons were directors of catapult group international ltd during or since the end of the
financial year
Dr Adir Shiffman
MBBS, Medicine
executive chairman
Appointed 4 september 2013
member of Remuneration and
nomination committee
dr Adir shiffman, executive chairman of catapult,
has extensive ceO and board experience in the
technology sector.
Adir has founded and sold more than half a dozen
technology startups, many of which were high
growth saas (software as a service) businesses. his
expertise includes: strategic planning, international
expansion, mergers and acquisitions, and
strategic partnerships.
Mr Shaun Holthouse
B.E. (Hon), Mechanical Engineering, GAICD
chief executive Officer to 30 April 2017
global head of strategy from 1 may 2017
Appointed 4 september 2013
founder, executive director and global head
of strategy.
shaun has extensive experience in new technology
transitioning into commercial products, including
biotechnology, mems, fuel cells, and scientific
instrumentation. prior to co-founding catapult,
shaun was a technology development manager for
the cRc for microtechnology from 2002-2006, which
included providing technical direction to more than
20 projects with a budget of more than $60 million.
Adir currently sits on a number of boards. he is
regularly featured in the media in Australia, the
us and europe.
shaun has grown catapult from its inception as ceO
from 2006 to 1 June 2017. from 1 June 2017 shaun’s
role changed to global head of strategy.
Adir graduated from monash university with a
bachelor of medicine and a bachelor of surgery.
prior to becoming involved in the technology sector,
he practised as a doctor.
Other current Directorships:
none
shaun holds a bachelor of engineering (hons)
from the university of melbourne and is a graduate
member of the Australian institute of company
directors. he is the author of numerous patents
and patent applications in athlete tracking,
analytics and other technologies.
Other current Directorships:
Previous Directorships (last 3 years):
none
in past three years he has also been a director
of ibuynew group limited (AsX:ibn) (Appointed
february 2013. Resigned march 2017).
Previous Directorships (last 3 years):
none
Catapult Group International Limited Annual Report 2017
19
Mr Igor van de Griendt
B.E. Electrical Engineering
chief technology Officer
Appointed 4 september 2013
Mr Calvin Ng
BComm (Fins) LLB AMC DFP
non-executive director
Appointed 29 november 2013
member of Risk and Audit committee
member of Risk and Audit committee
mr igor van de griendt is a co-founder, chief
Operating Officer and an executive director
of catapult.
mr calvin ng has significant investment
banking, mergers & acquisitions and funds
management experience.
in his capacity as ctO, he has been responsible
for providing strategic direction and leadership
in the development of catapult’s products, both
in the analytical space, as well as with respect to
catapult’s various hardware offerings.
igor also provides guidance and operational
support to catapult’s R&d and software
development teams.
prior to co-founding catapult, igor was a project
manager for the cRc for microtechnology which,
in collaboration with the Australian institute of
sport, developed a number of sensor platforms
and technologies ultimately leading to the founding
of catapult.
prior to joining the cRc for microtechnology,
igor was a director of a consulting business that
provided engineering services for more than
13 years to technology companies such as Redflex
communications systems (now part of exelis,
nyse:Xls), ceramic fuel cells (AsX:cfu),
ericsson Australia, nec Australia and telstra.
igor holds a bachelor of electrical engineering from
darling downs institute of Advanced education
(now university of southern Queensland).
Other current Directorships:
none
Previous Directorships (last 3 years):
none
calvin is a co-founder and managing director of
the Aura group, an independent corporate advisory
and funds and wealth management business. he
is also a co-founder and non-executive director
of the finsure group one of Australia’s largest
mortgage groups.
calvin has significant board experience in a number
of businesses, with particular expertise in providing
management oversight and strategic guidance to
small and medium sized enterprises.
calvin currently sits on a number of boards,
including entities associated with the Aura group,
finsure group and AsX-listed ibuynew group
limited (AsX:ibn).
calvin holds a bachelor of commerce and bachelor
of laws from the university of new south wales.
calvin has also completed a graduate diploma of
legal practice and has been admitted to practice as
a lawyer in the supreme court of new south wales.
Other current Directorships:
ibuynew group limited (AsX:ibn) (Appointed
february 2013)
Previous Directorships (last 3 years):
none
20
Directors’ Report
Mr Brent Scrimshaw
non-executive director
Appointed 24 november 2014
chair of Remuneration and nomination committee
mr brent scrimshaw has over 25 years of experience
in consumer innovation, business leadership and
brand management, which he gained by acting in
several roles for nike that were focussed on the
athletic and sports industry primarily through a
diverse international career at nike inc.
brent has held senior leadership roles at nike inc,
including vice president and chief executive of
western europe; chief marketing Officer and vice
president of category businesses for nike europe,
middle east and Africa; and general manager
of nike’s east coast united states operations
in new york.
As one of nike inc’s 30 most senior leaders
worldwide, brent has also served on nike’s global
corporate leadership team, where he helped
lead the creation of nike’s overall global operating
strategy, as well as playing a senior role as a key
member of the global commercial Operations
executive team, which is responsible for sales and
distribution strategies worldwide.
brent is currently a non-executive director at
Rhinomed ltd (AsX:RnO) a medical technology
company focussed on enhancing human efficiency
through innovative respiratory technologies and
products, as well as the ceO of unscripted, one
of the world’s fastest growing digital sports
media properties.
Other current Directorships:
Rhinomed ltd (AsX:RnO) (Appointed february 2014)
Previous Directorships (last 3 years):
none
Mr James Orlando
BSc, MBA
non-executive director
Appointed 24 October 2016
chair of Risk and Audit committee
member of Remuneration and
nomination committee
mr James Orlando has held senior finance positions
driving growth and shareholder value in the
united states, Asia and Australia. most recently
he was the cfO of veda group ltd (ved.AsX)
leading the company through its successful ipO
in december 2013.
before Joining veda, James was the cfO of AApt
where he focused on improving the company’s
earning as well as divesting its
non-core consumer business. he also served
as the cfO of powertel ltd, and AsX-listed
telecommunications service provider which was sold
to telecom new Zealand in 2007. James also held
various international treasury positions at At&t
and lucent technologies in the us and hong kong
including running lucent’s international project and
export finance organisation.
Other current Directorships:
none
Catapult Group International Limited Annual Report 2017
21
Mrs Rhonda O’Donnell
M App Sc, MBA (Melbourne)
non-executive director
Appointed 3 september 2014
Resigned 9 september 2016
chair of Risk and Audit committee until
9 september 2016
member of Remuneration and nomination
committee until 9 september 2016
mrs Rhonda O’donnell has extensive experience
in international and local industries including
telecommunications, information technology,
education, government and utilities.
Rhonda has been a successful executive and board
member in both the private and public sectors. she
has received several industry achievement awards,
including the award for the victorian telstra business
woman of the year in 1999.
Rhonda was also a non-executive director of
AsX-listed slater & gordon (AsX:sgh) and is a
trustee of mtAA super and former president/
chairman of novell Asia pacific.
Previous Directorships:
slater & gordon (sgh.AsX) (Appointed march 2013.
Resigned february 2017)
COmPAnY SECREtARY
Anand sundaraj is a lawyer, specialising in corporate
finance and securities law and has been involved
in a comprehensive range of corporate and
investment transactions including numerous initial
public offerings on the AsX. Anand was appointed
company secretary of catapult group international
on 22 July 2016.
PRInCIPAL ACtIvItIES
during the year, the principal activities of entities
within the group were:
> the development and sale of wearable tracking
solutions and analytics to elite sporting teams,
leagues and associations;
> the development and sale of digital video
coaching and analytics solutions to elite sporting
teams, leagues and associations; and
> the development and sale of wearable tracking
solutions and analytics to prosumer athletes,
sporting teams and associations.
the group’s wearable and video solutions are
provided to elite clients on both a subscription and
upfront sales basis, with subscription sales forming
the majority of all sales to elite clients. the group
is the global leader in wearable tracking technology
and analytics solutions for the elite market with
over 1,500 elite clients. the group is also a market
leader in providing innovative digital and video
analytic software solutions to elite sports teams in
the united states, specialising in designing custom
digital video solutions to improve and optimise
sports coaching operations as well as monetisation
and distribution of digital media assets.
with major offices in Australia, the united states
and the united kingdom and over 300 staff in
more than 14 countries, catapult is an Australian
technology success story with a truly global footprint
that is committed to advancing the way data is used
in elite sports.
22
Directors’ Report
REvIEW OF OPERAtIOnS AnD FInAnCIAL RESuLtS
the group has recorded an increased loss of $13,581,000 (2016: $5,870,824). this increase is due to increased
depreciation and amortisation charges associated with: the acquisition of XOs and playertek in August 2016;
increased investment in development of products and software; and increasing size of subscription unit fleet.
loss per share for the year was $0.086 (2016: $0.05) and no dividend will be paid or declared.
the group’s net assets increased to $114,762,000 compared to the previous years’ position of $11,939,461.
SIGnIFICAnt ChAnGES In thE StAtE OF AFFAIRS
during the year, the following changes occurred within the group:
> capital Raising: during the year, the group issued 43,073,500 fully paid ordinary shares as part of its
capital raising program, which resulted in gross proceeds of $116,673,568; and
> Acquisition of XOs technologies inc and kodaplay limited in August 2016.
in the directors’ opinion, there have been no other significant changes in the state of affairs of the group
during the year. A further review of matters affecting the group’s state of affairs is contained in the
operating and financial review.
EvEntS ARISInG SInCE thE EnD OF thE REPORtInG PERIOD
Acquisition of Athlete Management System:
On 4 August 2017, catapult acquired the sportsmed elite and baseline Athlete management system (Ams)
products and clients and recruited key personnel, from smg technologies pty ltd (smg) for consideration
ranging between $1.4m and $3.9m depending on performance metrics and incremental revenue generated
in the two years following the acquisition.
the Ams acquisition is strategically and financially compelling for catapult’s shareholders as it:
> delivers on a key catapult strategic objective – the capability to provide teams with a centralised data
repository and analytics across a wide range of club data sources;
>
integration of Ams products will extend catapult’s ability to provide teams with Artificial intelligence
and machine learning based analytics beyond current streams of data (wearable and video); and
> significant incremental subscription revenue opportunity via cross-selling to catapult’s c.1,500 existing
client base.
LIKELY DEvELOPmEntS, BuSInESS StRAtEGIES AnD PROSPECtS
based on the expected demand for athlete analytics globally and the continued growth in the group’s sales
and marketing platform across key regions, we are optimistic about the long term growth opportunity.
furthermore, catapult group has continued to broaden its suite of athlete analytics solutions through the
acquisitions of XOs, plAyeRtek and Ams, resulting in a substantially larger addressable market opportunity
across a wider range of customers in both elite and prosumer sporting leagues. catapult group expects to
benefit in these new segments with increasing sales and brand loyalty.
Catapult Group International Limited Annual Report 2017
23
BuSInESS RISK
in executing its growth plans catapult group is subject to the following key market, operational and
acquisition risks outlined below.
Economic risk
catapult may be affected by general economic conditions. changes in the broader economic and financial
climate may adversely affect the conduct of the catapult’s operations. in particular, sustained economic
downturns in key geographies where catapult is focused may adversely affect its financial performance.
changes in economic factors affecting general business cycles, inflation, legislation, monetary and regulatory
policies, as well as changes to accounting standards, may also affect the performance of catapult.
Industry and competition risk
catapult’s performance could be adversely affected if existing or new competitors reduce catapult’s market
share, or its ability to expand into new market segments. catapult’s existing or new competitors may have
substantially greater resources and access to more markets than catapult. competitors may succeed in
developing alternative products which are more innovative, easier to use or more cost effective than those
that have been or may be developed by catapult. this may place pricing pressure on catapult’s product
offering and may impact on catapult’s ability to retain existing clients, as well as catapult’s ability to attract
new clients. if catapult cannot compete successfully, catapult’s business, operating results and financial
position could be adversely impacted.
Technology and hosting platforms
catapult relies on a third party hosting provider to maintain continuous operation of its technology platforms,
servers and hosting services and the cloud based environment in which catapult provides its products. there
is a risk that these systems may be adversely affected by various factors such as damage, faulting or aging
equipment, power surges or failures, computer viruses, or misuse by staff or contractors. Other factors such
as hacking, denial of service attacks, or natural disasters may also adversely affect these systems and cause
them to become unavailable. further, if catapult’s third party hosting provider ceased to offer its services to
catapult and catapult was unable to obtain a replacement provider quickly, this could lead to disruption of
service to the catapult website and cloud infrastructure. this could lead to a loss of revenue while catapult is
unable to provide its services, as well as adversely affecting its reputation. this could have a material adverse
effect on catapult’s financial position and performance.
Data loss, theft or corruption
catapult provides its services through cloud based and other online platforms. hacking or exploitation of any
vulnerability on those platforms could lead to loss, theft or corruption of data. this could render catapult’s
services unavailable for a period of time while data is restored. it could also lead to unauthorised disclosure
of users’ data with associated reputational damage, claims by users, regulatory scrutiny and fines. Although
catapult employs strategies and protections to try to minimise security breaches and to protect data, these
strategies and protections might not be entirely successful. in that event, disruption to catapult’s services
could adversely impact on catapult’s revenue and profitability. the loss of client data could have servers
impacts to client service, reputation and the ability for clients to use the products.
24
Directors’ Report
BuSInESS RISK (continued)
Manufacturing and product quality risks
catapult currently uses third party manufacturers to produce components of its products. there is no
guarantee that these manufacturers will be able to meet the cost, quality and volume requirements that are
required to be met in order for catapult to remain competitive. catapult’s products must also satisfy certain
regulatory and compliance requirements which may include inspection by regulatory authorities. failure by
catapult or its suppliers to continuously comply with applicable requirements could result in enforcement
action being taken against catapult.
As a manufacturer, importer and supplier of products, product liability risk (including claims relating to
product faults), faulty products and associated recall and warranty obligations are key risks of the catapult
business. while catapult has product liability insurance, not all claims will be covered by this and the fallout
from product liability issues may be far greater than what an insurance policy is able to cover.
Foreign exchange
foreign exchange rates are particularly important to catapult’s business given the significant amount of
revenue which catapult derives from overseas. catapult’s financial statements are prepared and presented
in Australian dollars. Adverse movements in foreign currency markets could affect catapult’s profitability
and financial position.
Development and commercialisation of intellectual property
catapult relies on its ability to develop and commercialise its intellectual property. A failure to develop and
commercialise its intellectual property successfully would lead to a loss of opportunities and adversely impact
the operating results and financial position of catapult. furthermore, any third party developing superior
technology or technology with greater commercial appeal in the fields in which catapult operates may harm
the future prospects of catapult.
catapult’s success depends, in part, on its ability to obtain, maintain and protect its intellectual property,
including its patents. Actions taken by catapult to protect its intellectual property may not be adequate,
complete or enforceable and may not prevent the misappropriation of its intellectual property and
proprietary information or deter independent development of similar technologies by others. catapult may
also suffer damage if former employees infringe its intellectual property rights or assert their moral rights.
the granting of a patent does not guarantee that catapult’s intellectual property is protected and that
others will not develop similar technologies that circumvent such patents. there can be no assurance that
any patents catapult owns, controls or licences, whether now or in the future, will give catapult commercially
significant protection of its intellectual property.
monitoring unauthorised use of catapult’s intellectual property rights is difficult and can be costly.
catapult may not be able to detect unauthorised use of its intellectual property rights. changes in laws in
Australia and other jurisdictions in which catapult operates may adversely affect catapult’s intellectual
property rights.
Other parties may develop and patent substantially similar or substitute products, processes, or technologies
to those used by catapult, and other parties may allege that catapult’s products incorporate intellectual
property rights derived from third parties without their permission. whilst catapult is not the subject of any
claim that its products infringe the intellectual property rights of a third party, allegations of this kind may be
received in the future and, if successful, injunctions may be granted against catapult which could materially
affect the operation of catapult and catapult’s ability to earn revenue, and cause disruption to catapult’s
services. the defence and prosecution of intellectual property rights lawsuits, proceedings, and related legal
and administrative proceedings are costly and time-consuming, and their outcome is uncertain.
Catapult Group International Limited Annual Report 2017
25
in addition to its patent and licensing activities, catapult also relies on protecting its trade secrets. Actions
taken by catapult to protect its trade secrets may not be adequate and this could erode its competitive
advantage in respect of such trade secrets. further, others may independently develop similar technologies.
Further product development risk
catapult has developed its athlete video and tracking technology and products, and continues to invest in
further systems and product development.
catapult gives no guarantee that further development of its video and athlete tracking technology and
products will be successful, that development milestones will be achieved, or that catapult’s intellectual
property will be developed into further products that are commercially exploitable. there are many risks
inherent in the development of technologies and related products, particularly where the products are in
the early stages of development. projects can be delayed or fail to demonstrate any benefit, or may cease
to be viable for a range of reasons, including scientific and commercial reasons.
Brand and reputation damage
the brand and reputation of catapult and its individual products are important in retaining and increasing
the number of clients that utilise catapult’s technology and products and could prevent catapult
from successfully implementing its business strategy. Any reputational damage or negative publicity
surrounding catapult or its products could adversely impact on catapult’s business and its future growth
and profitability.
Product liability
catapult’s business exposes it to potential product liability claims related to the manufacturing, marketing
and sale of its products. catapult maintains product liability insurance. however, to the extent that a claim
is brought against catapult that is not covered or fully covered by insurance, such claim could have a material
adverse effect on the business, financial position and results of catapult. claims, regardless of their merit or
potential outcome, may adversely impact on catapult’s business and its future growth and profitability.
Litigation
catapult may in the ordinary course of business be involved in possible disputes. these disputes could give rise
to litigation. while the extent of any disputes and litigation cannot be ascertained at this time, any dispute or
litigation may be costly and may adversely affect the operational and financial results of catapult.
DIvIDEnDS
in respect of the current year, no dividend has been paid by catapult group international limited.
26
Directors’ Report
DIRECtORS’ mEEtInGS
the number of directors meetings (including meetings of committees of directors) held during the year, and
the number of meetings attended by each director is as follows:
Director’s Name
Board Meetings
Audit and
Risk Committee
Remuneration and
Nomination Committee
Adir shiffman
shaun holthouse
igor van de griendt
calvin ng
brent scrimshaw
Jim Orlando
Rhonda O’donnell
A
11
11
11
11
11
6
4
B
9
11
10
10
10
6
4
A
–
–
8
8
–
4
3
B
–
–
8
8
–
4
3
A
4
–
–
–
4
2
2
B
4
–
–
–
4
2
2
where:
column A is the number of meetings the director was entitled to attend.
column b is the number of meetings the director attended.
unISSuED ShARES unDER OPtIOn
unissued ordinary shares of catapult group international ltd under option at the date of this report:
Date Options Granted
Expiry Date
31 October 2014
31 October 2014
31 October 2014
31 October 2014
31 October 2014
31 October 2014
14 April 2016
14 April 2016
14 April 2016
14 April 2016
12 August 2016
31 October 2019
31 October 2019
31 October 2019
22 september 2017
22 september 2018
22 september 2019
14 April 2021
14 April 2021
1 January 2021
1 January 2021
23 may 2020
Exercise
Price of
Shares
Number
under
Option
$0.55
834,500
$0.605
1,920,000
$0.00
$0.00
$0.00
$0.00
$2.20
$1.68
$2.31
$1.55
$4.46
105,000
100,000
100,000
100,000
726,886
90,000
50,000
300,000
50,000
Catapult Group International Limited Annual Report 2017
27
Date Options Granted
Expiry Date
22 september 2016
22 september 2016
22 september 2016
22 september 2016
22 september 2016
23 may 2019
23 may 2019
23 may 2019
23 may 2019
23 may 2019
30 november 2016
24 march 2018
30 november 2016
24 march 2019
30 november 2016
23 march 2020
30 november 2016
22 september 2019
30 november 2016
30 september 2021
1 may 2017
1 may 2022
Exercise
Price of
Shares
$3.78
$1.35
$3.61
Number
under
Option
300,000
200,000
100,000
$3.82
1,000,000
$1.35
450,000
$4.284
500,000
$4.843
500,000
$4.843
500,000
$0.00
300,000
$3.00
1,000,000
$2.54
2,000,000
All options expire on their expiry date.
All options issued are part of the share based employee remuneration program.
ShARES ISSuED DuRInG OR SInCE thE EnD OF thE YEAR AS A RESuLt OF ExERCISE
the company has issued 1,664,400 ordinary shares as a result of the exercise of options issued in October 2013.
the company has issued 92,500 ordinary shares from treasury shares held, as a result of the exercise of
options granted in 31 October 2014.
the company has issued 19,602 ordinary shares from treasury shares held, as a result of the exercise of
options granted on 14 April 2016.
the company has issued 25,000 ordinary shares from treasury shares held, as a result of the exercise of
options granted on 31 October 2014.
28
Directors’ Report
REmunERAtIOn REPORt (AuDItED)
the directors of catapult group international ltd present the Remuneration Report for non-executive
directors, executive directors and other key management personnel, prepared in accordance with the
Corporations Act 2001 and the Corporations Regulations 2001.
the Remuneration Report is set out under the following main headings:
> principles used to determine the nature and amount of remuneration;
> details of remuneration;
> service agreements;
> share-based remuneration; and
> Other information.
Principles used to determine the nature and amount of remuneration
the principles of the group’s executive strategy and supporting incentive programs and frameworks are:
> to align rewards to business outcomes that deliver value to shareholders;
> to drive a high performance culture by setting challenging objectives and rewarding high performing
individuals; and
> to ensure remuneration is competitive in the relevant employment market place to support the attraction,
motivation and retention of executive talent.
the board has established a nomination and Remuneration committee which operates in accordance
with its charter as approved by the board and is responsible for determining and reviewing compensation
arrangements for the directors and the executive team.
the remuneration structure that has been adopted by the group consists of the following components:
> fixed remuneration being annual salary; and
> short term incentives, being employee bonuses.
the nomination and Remuneration committee assess the appropriateness of the nature and amount of
remuneration on a periodic basis by reference to recent employment market conditions with the overall
objective of ensuring maximum stakeholder benefit from the retention of a high quality board and
executive team.
the payment of bonuses, share options and other incentive payments are reviewed by the nomination and
Remuneration committee annually as part of the review of executive remuneration and a recommendation
is put to the board for approval. All bonuses, options and incentives must be linked to pre-determined
performance criteria.
Catapult Group International Limited Annual Report 2017
29
REmunERAtIOn REPORt (AuDItED) (continued)
Short Term Incentive (STI)
the group’s performance measures involve the use of annual performance objectives, metrics, performance
appraisals and continuing emphasis on living the company values.
the performance measures are set annually after consultation with the directors and executives and
are specifically tailored to the areas where each executive has a level of control. the measures target
areas the board believes hold the greatest potential for expansion and profit and cover financial and
non-financial measures.
the key performance indicators (‘kpi’s’) for the executive team are summarised as follows:
performance area:
> financial – operating profit and earnings per share; and
> non-financial – strategic goals set by each individual business unit based on job descriptions.
the sti program is currently a cash bonus for the executive team and other employees.
a
Remuneration Approval
catapult group submits its Remuneration Report for adoption by shareholders at the annual general
meeting. the current remuneration reflects the report adopted 30 november 2016.
Consequences of performance on shareholder wealth
in considering the group’s performance and benefits for shareholder wealth, the board believe the following
indices should be applicable to the current financial year and previous financial year:
Item
eps (dollars)
dividends (cents per share)
Revenue ($’000)
underlying ebitdA ($’000)
statutory ebitdA ($’000)
net loss ($’000)
share price ($)
b
Details of remuneration
2017
(0.086)
–
2016
(0.05)
–
60,783
17,368
2,858
(4,400)
(3,713)
(6,789)
(13,581)
(5,871)
2.33
3.08
details of the nature and amount of each element of the remuneration of each key management personnel
(‘kmp’) of catapult group international ltd shown in the table below:
30
Directors’ Report
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32
Directors’ Report
REmunERAtIOn REPORt (AuDItED) (continued)
the relative proportions of remuneration that are linked to performance and those that are fixed are
as follows:
Name
Executive Directors
Adir shiffman
shaun holthouse
igor van de griendt
Other Key Management Personnel
Joe powell
shane greenan
barry mcneill
matt bairos
brian kopp
Fixed
remun-
eration
At risk –
STI
At risk –
options
60%
52%
54%
51%
60%
71%
59%
58%
28%
39%
33%
40%
20%
22%
38%
29%
12%
9%
13%
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20%
7%
3%
13%
long term incentives are provided exclusively by way of options, the percentages disclosed reflect the
valuation of remuneration consisting of options, based on the value of options expensed during the year.
Bonuses included in remuneration
details of the short-term incentive cash bonuses awarded as remuneration to each key management
personnel, the percentage of the available bonus that was paid in the financial year, and the percentage
that was undetermined at the end of the year is set out below.
Total
At Risk
Amount
($)
Percentage
vested
during
the year
Percentage
forfeited
during
the year
Percentage
undet
ermined
at 30 June
Performance criteria
Executive Directors
Adir shiffman
120,000
30%
70%
0% performance against public targets
closing acquisitions
shaun holthouse
200,000
30%
70%
0% performance against public targets
closing acquisitions
igor van de griendt
123,000
30%
70%
0% performance against public targets
technology development targets
Catapult Group International Limited Annual Report 2017
33
Total
At Risk
Amount
($)
Percentage
vested
during
the year
Percentage
forfeited
during
the year
Percentage
undet
ermined
at 30 June
Performance criteria
Performance against public targets
Joe powell (i)
400,000
100%
0%
0% performance against ceO
transition goals
shane greenan (i)
100,000
30%
70%
0% performance against public targets
barry mcneill
110,000
64%
36%
matt bairos (i)
237,069
100%
brian kopp
172,185
19%
0%
0%
finance function targets
0% performance against public targets
product development including
analytics and client health
0% Revenue and ebitdA targets for
video Analytics business unit
81% performance against public targets
performance of catapult us
(i) For KMP who joined the Group during the period the Total Amount at Risk amount relates to a 12 month period so it is provided on a
consistent basis to other KMP listed in the table. The percentage amounts shown for vested, forfeited and undetermined are based
on the pro-rata mounts that the KMP is entitled to from date of joining the Group to 30 June 2017.
Service agreements
Remuneration and other terms of employment for the executive directors and other key management
personnel are formalised in a service Agreement. the major provisions of the agreements relating to
remuneration are set out below:
Name
Current
base salary
Term of agreement
Notice period
Adir shiffman
$255,000
unspecified
One (1) month
shaun holthouse
$265,000
unspecified
three (3) months
igor van de griendt
$200,000
unspecified
three (3) months
Joe powell
$500,000
unspecified
six (6) months
shane greenan
$294,616
unspecified
three (3) months
barry mcneill
$350,000
unspecified
One (1) month
matt bairos
usd 275,000
unspecified
At will
Annual
Director’s
fees not
included in
base salary
–
$85,000
$85,000
–
–
–
–
34
Directors’ Report
REmunERAtIOn REPORt (AuDItED) (continued)
Share-based remuneration
All options refer to options over ordinary shares of the company, which are exercisable on a one-for-one basis
under the terms of the agreements. All options remain subject to other vesting criteria, there are no criteria
specifically set, but remain subject review and approval by the Remuneration and nomination committee.
c
Details of options & rights holdings
Name
Joe powell
Grant Date
Held at
1 July 16
Granted
as remun-
eration
Net change
other
Held at
30 June
2017
Vested
during
the year
Vested
during year
and as at
30 June 17
Vesting
Note
Schedule Vesting date Expiry Date
grant date
grant date
Value per
Total value
option/
rights at
of option/
rights at
Exercise
price per
option
1-may-17
–
2,000,000
–
2,000,000
n/a
n/a
500,000
1-may-18
1-may-22
$0.52
$258,350
Adir shiffman
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
$0.31
$31,390
calvin ng
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
30-nov-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
$3.27
$327,000
shaun holthouse
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
$0.31
$31,390
igor van de griendt
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
brent scimshaw
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
500,000
1-may-19
1-may-22
$0.57
$286,350
500,000
1-may-20
1-may-22
$0.63
$314,350
500,000
1-may-21
1-may-22
$0.68
$340,950
100,000
22-sep-18
24-mar-19
$0.45
$44,820
100,000
22-sep-19
23-mar-20
$0.65
$0.31
$64,700
$31,390
100,000
22-sep-18
24-mar-19
$0.45
$44,820
100,000
22-sep-19
23-mar-20
$0.65
$64,700
100,000
22-sep-18
24-mar-19
$3.27
$327,000
100,000
22-sep-19
23-mar-20
$3.27
$327,000
100,000
22-sep-18
24-mar-19
$0.45
$44,820
100,000
22-sep-19
23-mar-20
100,000
22-sep-18
24-mar-19
$0.45
$44,820
100,000
22-sep-19
23-mar-20
$0.65
$0.31
$0.65
$0.31
$64,700
$31,390
$64,700
$31,390
100,000
22-sep-18
24-mar-19
$0.45
$44,820
100,000
22-sep-19
23-mar-20
$0.65
$64,700
$2.54
$2.54
$2.54
$2.54
$4.28
$4.83
$4.83
$4.28
$4.83
$4.83
$0.00
$0.00
$0.00
$4.28
$4.83
$4.83
$4.28
$4.83
$4.83
$4.28
$4.83
$4.83
Catapult Group International Limited Annual Report 2017
35
REmunERAtIOn REPORt (AuDItED) (continued)
Share-based remuneration
All options refer to options over ordinary shares of the company, which are exercisable on a one-for-one basis
under the terms of the agreements. All options remain subject to other vesting criteria, there are no criteria
specifically set, but remain subject review and approval by the Remuneration and nomination committee.
c
Details of options & rights holdings
Name
Joe powell
Grant Date
Held at
1 July 16
as remun-
Net change
eration
other
Granted
Held at
30 June
2017
Vested
during
the year
Vested
during year
and as at
30 June 17
Vesting
Note
Schedule Vesting date Expiry Date
Value per
option/
rights at
grant date
Total value
of option/
rights at
grant date
Exercise
price per
option
1-may-17
–
2,000,000
–
2,000,000
n/a
n/a
500,000
1-may-18
1-may-22
$0.52
$258,350
500,000
1-may-19
1-may-22
$0.57
$286,350
500,000
1-may-20
1-may-22
$0.63
$314,350
500,000
1-may-21
1-may-22
$0.68
$340,950
Adir shiffman
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
$0.31
$31,390
calvin ng
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
100,000
22-sep-19
23-mar-20
$0.65
$0.31
$64,700
$31,390
100,000
22-sep-18
24-mar-19
$0.45
$44,820
30-nov-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
$3.27
$327,000
100,000
22-sep-18
24-mar-19
$0.45
$44,820
100,000
22-sep-19
23-mar-20
$0.65
$64,700
shaun holthouse
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
$0.31
$31,390
igor van de griendt
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
100,000
22-sep-19
23-mar-20
$0.65
$0.31
$64,700
$31,390
100,000
22-sep-18
24-mar-19
$0.45
$44,820
brent scimshaw
1-dec-16
–
300,000
–
300,000
n/a
n/a
100,000
22-sep-17
24-mar-18
100,000
22-sep-19
23-mar-20
$0.65
$0.31
$64,700
$31,390
100,000
22-sep-18
24-mar-19
$0.45
$44,820
100,000
22-sep-18
24-mar-19
$3.27
$327,000
100,000
22-sep-19
23-mar-20
$3.27
$327,000
100,000
22-sep-18
24-mar-19
$0.45
$44,820
100,000
22-sep-19
23-mar-20
$0.65
$64,700
$2.54
$2.54
$2.54
$2.54
$4.28
$4.83
$4.83
$4.28
$4.83
$4.83
$0.00
$0.00
$0.00
$4.28
$4.83
$4.83
$4.28
$4.83
$4.83
$4.28
$4.83
$4.83
36
Directors’ Report
REmunERAtIOn REPORt (AuDItED) (continued)
c
Details of options & rights holdings (continued)
Name
Grant Date
Held at
1 July 16
Granted
as remun-
eration
Net change
other
Held at
30 June
2017
Vested
during
the year
Vested
during year
and as at
30 June 17
Vesting
Note
Schedule Vesting date Expiry Date
grant date
grant date
Value per
Total value
option/
rights at
of option/
rights at
Exercise
price per
option
shane greenan
30-nov-16
–
250,000
–
250,000
50,000
50,000
50,000
30-Jun-17
30-sep-21
$0.92
$45,890
barry mcneill
31-Oct-14
960,000
barry mcneill
14-Apr-16
100,000
brian kopp
31-Oct-14
960,000
–
–
–
–
960,000
320,000
640,000
320,000
15-sep-15
31-Oct-19
–
100,000
–
(a)
100,000
12-Apr-19
14-Apr-21
(480,000)
480,000
432,000
480,000
48,000
15-sep-15
31-Oct-19
matthew bairos
22-sep-16
–
66,000
–
66,000
n/a
n/a
66,000
20-mar-20
22-sep-19
(a) 100,000 options were issued to Barry McNeill during the year (30 June 2016) and are not subject to any performance vesting
conditions, as they issued in recognition of his ongoing contribution to Group’s success over the last twelve months, and his
importance to both the short and long term success of Group.
All options and rights above were issued for nil consideration and will vest on the vesting date noted provided
the continuous service conditions and any applicable performance conditions have been met. the options and
rights may be exercised at any time from the vesting date to expiry date, subject to those options issued on
31 Oct 14 meeting the escrow period from 2 years from ipO date.
50,000
30-Jun-18
30-sep-21
50,000
30-Jun-19
30-sep-21
50,000
30-Jun-20
30-sep-21
50,000
30-Jun-21
30-sep-21
320,000
15-sep-16
31-Oct-19
320,000
15-sep-17
31-Oct-19
240,000
15-sep-16
31-Oct-19
192,000
15-may-17
31-Oct-19
$1.01
$1.10
$1.17
$1.25
$0.08
$0.13
$0.17
$0.99
$0.08
$0.13
$0.17
$1.20
$50,520
$54,760
$58,695
$62,355
$24,960
$42,240
$55,040
$98,800
$3,840
$32,160
$33,216
$78,995
$3.55
$3.55
$3.55
$3.55
$3.55
$0.61
$0.61
$0.61
$2.20
$0.61
$0.61
$0.61
$3.78
Catapult Group International Limited Annual Report 2017
37
REmunERAtIOn REPORt (AuDItED) (continued)
c
Details of options & rights holdings (continued)
Name
Grant Date
Granted
Held at
1 July 16
as remun-
Net change
eration
other
Held at
30 June
2017
Vested
during
the year
Vested
during year
and as at
30 June 17
Vesting
Note
Schedule Vesting date Expiry Date
Value per
option/
rights at
grant date
Total value
of option/
rights at
grant date
Exercise
price per
option
shane greenan
30-nov-16
–
250,000
–
250,000
50,000
50,000
50,000
30-Jun-17
30-sep-21
$0.92
$45,890
50,000
30-Jun-18
30-sep-21
50,000
30-Jun-19
30-sep-21
50,000
30-Jun-20
30-sep-21
50,000
30-Jun-21
30-sep-21
barry mcneill
31-Oct-14
960,000
–
960,000
320,000
640,000
320,000
15-sep-15
31-Oct-19
barry mcneill
14-Apr-16
100,000
–
100,000
–
(a)
100,000
12-Apr-19
14-Apr-21
brian kopp
31-Oct-14
960,000
(480,000)
480,000
432,000
480,000
48,000
15-sep-15
31-Oct-19
matthew bairos
22-sep-16
–
66,000
–
66,000
n/a
n/a
66,000
20-mar-20
22-sep-19
240,000
15-sep-16
31-Oct-19
192,000
15-may-17
31-Oct-19
320,000
15-sep-16
31-Oct-19
320,000
15-sep-17
31-Oct-19
–
–
–
(a) 100,000 options were issued to Barry McNeill during the year (30 June 2016) and are not subject to any performance vesting
conditions, as they issued in recognition of his ongoing contribution to Group’s success over the last twelve months, and his
importance to both the short and long term success of Group.
All options and rights above were issued for nil consideration and will vest on the vesting date noted provided
the continuous service conditions and any applicable performance conditions have been met. the options and
rights may be exercised at any time from the vesting date to expiry date, subject to those options issued on
31 Oct 14 meeting the escrow period from 2 years from ipO date.
$1.01
$1.10
$1.17
$1.25
$0.08
$0.13
$0.17
$0.99
$0.08
$0.13
$0.17
$1.20
$50,520
$54,760
$58,695
$62,355
$24,960
$42,240
$55,040
$98,800
$3,840
$32,160
$33,216
$78,995
$3.55
$3.55
$3.55
$3.55
$3.55
$0.61
$0.61
$0.61
$2.20
$0.61
$0.61
$0.61
$3.78
38
Directors’ Report
REmunERAtIOn REPORt (AuDItED) (continued)
d
Details of shareholdings
the movement during the year in the number of ordinary shares held directly, indirectly or beneficially, by each
key management personnel, including their related parties, is as follows:
Name
Adir shiffman(a)
shaun holthouse
igor van de griendt
Rhonda O’donnell
brent scrimshaw
calvin ng(b)
Joe powell
brett coventry
barry mcneill
brian kopp
matt bairos
shane greenan
Held as
1 July 2016
Received on
exercise of
options
Purchased
or sold
during year
Net change
other
Held at
30 June 17
6,859,000
416,100
24,757,000
22,990,000
–
–
–
–
17,000
18,000
18,000
–
–
–
–
–
–
416,100
5,000
–
50,000
106,400
65,000
–
66,177
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
7,292,100
24,775,000
23,008,000
–
–
421,100
50,000
5,000
176,400
–
–
–
–
–
66,177
–
–
(a) Adir Shiffman holds a relevant interest in another 9,811,600 shares held by Disruptive Special Opportunities Fund I by virtue of him
being the sole shareholder in BBHF Pty Ltd which is a 23% shareholder of Disruptive Capital Pty Ltd which is the Trustee of the Fund.
He holds a relevant interest in another 11,552,000 shares held by Disruptive Special Opportunities Fund II by virtue of him being the
sole shareholder in BBHF Pty Ltd which is a 23% shareholder of Disruptive Capital Pty Ltd which is the Trustee of the Fund.
(b) Calvin Ng holds a relevant interest in another 9,811,600 shares held by Disruptive Special Opportunities Fund I by virtue of him being
the sole shareholder in Ng Capital Management Pty Ltd which is a 29% shareholder in Aura Group Pty Ltd which is a 69% shareholder
of Disruptive Capital Pty Ltd which is the Trustee of the Fund. He holds a relevant interest in another 11,552,000 shares held by
Disruptive Special Opportunities Fund II by virtue of him being the sole shareholder in Ng Capital Management Pty Ltd which is a 29%
shareholder in Aura Group Pty Ltd which is a 69% shareholder of Disruptive Capital Pty Ltd which is the Trustee of the Fund. He holds
a relevant interest in another 70,820 shares held by Aura Group Pty Ltd by virtue of him being the sole shareholder in Ng Capital
Management Pty Ltd which is a 29% shareholder in Aura Group Pty Ltd.
He also holds a relevant interest in another 2,000 shares held by Aura Funds Management 1 Pty Ltd by virtue of him being the sole
shareholder in Ng Capital Management Pty Ltd which is a 29% shareholder in Aura Group Pty Ltd, which is in turn holds a 100%
shareholding in Aura Funds Management 1 Pty Ltd.
(c) James Orlando holds a relevant interest in 30,000 shares by way of his relationship with Kimberly Ann Foltz.
EnD OF AuDItED REmunERAtIOn REPORt
EnvIROnmEntAL LEGISLAtIOn
catapult group international ltd operations are not subject to any particular or significant environmental
regulation under a law of the commonwealth or of a state or territory in Australia.
Catapult Group International Limited Annual Report 2017
39
InDEmnItIES GIvEn AnD InSuRAnCE PREmIumS PAID tO AuDItORS AnD OFFICERS
during the year, catapult group international ltd paid a premium to insure officers of the group. the officers
of the group covered by the insurance policy include all directors.
the liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may
be brought against the officers in their capacity as officers of the group, and any other payments arising
from liabilities incurred by the officers in connection with such proceedings, other than where such liabilities
arise out of conduct involving a wilful breach of duty by the officers or the improper use by the officers of
their position or of information to gain advantage for themselves or someone else to cause detriment to
the group.
details of the amount of the premium paid in respect of insurance policies are not disclosed as such disclosure
is prohibited under the terms of the contract.
the group has not otherwise, during or since the end of the financial year, except to the extent permitted
by law, indemnified or agreed to indemnify any current or former officer or auditor of the group against a
liability incurred as such by an officer or auditor.
nOn-AuDIt SERvICES
during the year, grant thornton, the company’s auditors, performed certain other services in addition to
their statutory audit duties.
the board has considered the non-audit services provided during the year by the auditor and is satisfied that
the provision of those non-audit services during the year is compatible with, and did not compromise, the
auditor independence requirements of the Corporations Act 2001 for the reason the non-audit services do
not undermine the general principles relating to auditor independence as set out in Apes 110 Code of Ethics
for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a
management or decision-making capacity for the company, acting as an advocate for the company or jointly
sharing risks and rewards.
details of the amounts paid to the auditors of the company, grant thornton, and its related practices for
audit and non-audit services provided during the year are set out in note 26 to the financial statements.
A copy of the Auditor’s independence declaration as required under s307c of the Corporations Act 2001 is
included on page 40 of this financial report and forms part of this directors’ Report.
PROCEEDInGS On BEhALF OF thE COmPAnY
no person has applied to the court under section 237 of the Corporations Act 2001 for leave to bring
proceedings on behalf of the company, or to intervene in any proceedings to which the company is a party,
to taking responsibility on behalf of the company for all or part of those proceedings.
signed in accordance with a resolution of the directors.
Dr Adir Shiffman
executive chairman
31 August 2017
40
Auditor’s Independence Declaration
The Rialto, Level 30
525 Collins St
Melbourne Victoria 3000
Correspondence to:
GPO Box 4736
Melbourne Victoria 3001
T +61 3 8320 2222
F +61 3 8320 2200
E info.vic@au.gt.com
W www.grantthornton.com.au
AUDITOR’S INDEPENDENCE DECLARATION
TO THE DIRECTORS OF CATAPULT GROUP
INTERNATIONAL LIMITED
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor
for the audit of Catapult Group International Limited for the year ended 30 June 2017, I declare
that, to the best of my knowledge and belief, there have been:
a
no contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
b
no contraventions of any applicable code of professional conduct in relation to the audit.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
A R J Nathanielsz
Partner - Audit & Assurance
Melbourne, 31 August 2017
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the
context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm
is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and
are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its
Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Catapult Group International Limited Annual Report 2017
41
Consolidated Statement of Profit or Loss
for the year ended 30 June 2017
Notes
Revenue
Other income
costs of goods sold
employee benefits expense
employee share option compensation expense
capital raising and listing expenses
travel, marketing and promotion
Occupancy
professional fees
Other expenses
Operating loss before Depreciation and amortisation
depreciation and amortisation
Operating loss
finance costs
finance income
Other financial items
Loss before income tax
income tax benefit
Loss for the year from continuing operations
Earnings per share
Notes
8
9
20
20
23
23
24
25
2017
$’000
2016
$’000
60,783
17,368
215
1,332
(14,224)
(2,552)
(28,401)
(11,066)
(3,256)
(385)
(290)
(84)
(6,111)
(3,698)
(1,972)
(862)
(3,824)
(3,351)
(6,538)
(3,586)
(3,713)
(6,789)
(9,994)
(1,800)
(13,707)
(8,589)
(21)
67
(385)
(26)
71
(78)
(14,046)
(8,622)
465
2,751
(13,581)
(5,871)
basic and diluted earnings per share (cents per share)
27
(8.6) cents
(5.0) cents
This statement should be read in conjunction with the notes to the financial statements.
42
Consolidated Statement
of Other Comprehensive Income
for the year ended 30 June 2017
Loss for the year from continuing operations
Other Comprehensive Income
Items that may be reclassified subsequently to profit or loss:
2017
$’000
2016
$’000
(13,581)
(5,871)
foreign currency translation differences for foreign operations, net of tax
(1,991)
(233)
Other comprehensive income for the year, net of tax
(1,991)
(233)
Total comprehensive income for the year attributable to owners
(15,572)
(6,104)
This statement should be read in conjunction with the notes to the financial statements.
Catapult Group International Limited Annual Report 2017
43
Consolidated Statement of Financial Position
As at 30 June 2017
Notes
30 June 17
$’000
30 June 16
$’000
Assets
Current
cash and cash equivalents
trade and other receivables
inventories
current tax assets
Total current assets
Non-Current
trade and other receivables
property, plant and equipment
goodwill
Other intangible assets
deferred tax assets
Total non-current assets
Total assets
Liabilities
Current
trade and other payables
deferred revenue
Other liabilities
employee benefits
borrowings
Total current liabilities
Non-Current
deferred revenue
Other liabilities
employee benefits
deferred tax liabilities
Total non-current liabilities
Total liabilities
Net assets
Equity
share capital
share option reserve
foreign currency translation reserve
Accumulated losses
Total equity
This statement should be read in conjunction with the notes to the financial statements.
10
11
12
11
13
14
15
16
17
18
20
19
18
20
16
21
16,686
26,864
3,342
2,013
48,905
208
7,710
53,127
41,181
10,167
112,393
161,298
8,542
22,380
1,125
6,084
3,141
41,272
698
395
62
4,109
5,264
46,536
114,762
3,643
8,358
2,104
1,859
15,964
46
4,196
1,213
4,234
4,498
14,187
30,151
5,710
7,927
690
3,275
–
17,602
260
–
67
283
610
18,212
11,939
138,724
4,033
(2,731)
(25,264)
114,762
23,586
777
(740)
(11,684)
11,939
44
Consolidated Statement of Changes in Equity
for the year ended 30 June 2017
Balance at 1 July 2015
Total comprehensive income
for the year
loss for the year
Other comprehensive income
Total comprehensive income
Transactions with owners,
recorded directly in equity
Contributions by and distributions
to owners
issue of ordinary shares, net of
transaction costs
share based payments
Total transactions with owners
Balance at 30 June 2016
Balance at 1 July 2016
Total comprehensive income
for the year
loss for the year
Other comprehensive income
Total comprehensive income
Transactions with owners,
recorded directly in equity
Contributions by and distributions
to owners
issue of ordinary shares, net of
transaction costs
share based payments
Total transactions with owners
Balance at 30 June 2017
Share
Option
Reserve
$’000
Foreign
Currency
Translation
Reserve
$’000
Accumulated
Losses
$’000
Total Equity
$’000
487
(507)
(5,813)
11,913
–
–
–
–
290
290
777
–
(5,871)
(233)
(233)
–
(5,871)
(5,871)
(233)
(6,104)
–
–
–
–
–
–
5,840
290
6,130
(740)
(11,684)
11,939
Share
Option
Reserve
$’000
Foreign
Currency
Translation
Reserve
$’000
Accumulated
Losses
$’000
Total Equity
$’000
777
(740)
(11,684)
11,939
–
–
–
–
3,256
3,256
4,033
–
(13,581)
(13,581)
(1,991)
(1,991)
–
(1,991)
(13,581)
(15,572)
–
–
–
–
–
–
115,138
3,256
118,394
(2,731)
(25,264)
114,762
Share
Capital
$’000
17,746
–
–
–
5,840
–
5,840
23,586
Share
Capital
$’000
23,586
–
–
–
115,138
–
115,138
138,724
This statement should be read in conjunction with the notes to the financial statements.
Catapult Group International Limited Annual Report 2017
45
Consolidated Statement of Cashflows
for the year ended 30 June 2017
Cash flows from operating activities
cash receipts from customers
cash paid to suppliers and employees
Cash generated from/(used in) operations
interest Received
government grants
income taxes paid
Acquisition and integration costs
Note
2017
$’000
2016
$’000
52,892
18,123
(59,168)
(21,054)
(6,276)
(2,931)
67
131
(12)
(2,754)
71
673
(34)
–
Net cash flows from/(used in) operating activities
29
(8,844)
(2,221)
Cash flows from investing activities
payments for property, plant and equipment
purchase of other intangible assets
(4,892)
(3,057)
(5,833)
(3,417)
R&d tax offset received and offset against purchase of intangibles
–
Acquisition of subsidiaries net of cash acquired
34, 35
(82,201)
931
–
Net cash flows used in investing activities
(92,926)
(5,544)
Cash flows from financing activities
loans received/(paid)
finance costs on bank loan
interest paid
proceeds from issue of share capital
proceeds from share options
transaction costs related to share capital issued
Net cash flows from financing activities
net increase in cash and cash equivalents
cash and cash equivalents at the beginning of the financial period
effect of exchange rate fluctuations on cash held
3,250
(111)
(21)
–
–
(26)
116,175
6,049
521
(4,440)
115,374
–
(288)
5,734
13,604
(2,031)
3,643
(561)
5,672
1
Cash and cash equivalents at the end of the financial period
16,686
3,643
This statement should be read in conjunction with the notes to the financial statements.
46
notes to the Consolidated Financial Statements
for the year ended 30 June 2017
1.
nAtuRE OF OPERAtIOnS
catapult group international ltd and its controlled entities (the ‘group’) principal activities are the
development and supply of wearable tracking devices, software and video analytics solutions for athletes and
sports teams.
2. GEnERAL InFORmAtIOn AnD BASIS OF PREPARAtIOn
the consolidated general purpose financial statements of the group have been prepared in accordance with
the requirements of the corporations Act 2001, Australian Accounting standards and other authoritative
pronouncements of the Australian Accounting standards board. compliance with Australian Accounting
standards results in full compliance with the international financial Reporting standards (‘ifRs’) as issued by
the international Accounting standards board (iAsb). catapult group international ltd is a for-profit entity
for the purpose of preparing the financial statements.
catapult group international ltd is the group’s ultimate parent company. catapult group international ltd
is a public company incorporated and domiciled in Australia and listed on the Australian stock exchange. the
address of its registered office and its principal place of business is the clocktower, 1 Aurora lane, docklands,
victoria, Australia.
the consolidated financial statements for the year ended 30 June 2017 were approved and authorised for
issue by the board of directors on 31 August 2017.
3. ChAnGES In ACCOuntInG POLICIES
3.1 New and revised standards that are effective for these financial statements
effective this financial period the amendment below takes effect 1st July 2016:
A number of new and revised standards became effective for the first time to annual periods beginning on
or after 1 July 2016. Only those that are significant to the group have been included.
3.2 Accounting Standards issued but not yet effective and have not been adopted early by
the Group
certain new accounting standards and interpretations have been published that are not mandatory for
30 June 2017 reporting periods, and have not yet been adopted by the group. the group’s assessment of the
impact of these new standards and interpretations is set out below:
AASB 15 Revenue from Contracts with Customers
AAsb 15:
> replaces AAsb 118 Revenue, AAsb 111 Construction Contracts and some revenue-related interpretations
> establishes a new control-based revenue recognition model
> establishes a new concept of ‘distinct good or services’ to identify performance obligations
> changes the basis for deciding whether revenue is to be recognised over time or at a point in time
> provides new and more detailed guidance on specific topics (e.g., multiple element arrangements, variable
pricing, rights of return, warranties and licensing)
> expands and improves disclosures about revenue
this standard will be adopted for the first time in the in the financial statements for the year ending
30 June 2019.
Catapult Group International Limited Annual Report 2017
47
management have undertaken a detailed review of contract obligations and the underlying transactions. this
review indicates that compliance with the standard may result in a requirement to adjust the current revenue
recognition methodology.
elite wearable contracts contain an obligation to provide training. this is currently amortised over the life
of the contract. compliance with the standard will require this revenue to be recognised as the service is
incurred, generally within the first 90 days of the contract, causing a change in the first year of revenue
recognition, this is not considered to have a material impact. A review of costs incurred in elite wearable
contract acquisition indicates that the sales staff commissions on total contract value, currently recognised
upfront, will also require a change in accounting treatment and be amortised over the life of the contract.
this change is not anticipated to be material.
As described in note 4.5 sub-elite sales contracts are a bundled offering containing both ‘Outright sale of
goods’ and ‘subscription sale’ elements. under the new revenue accounting standard it is likely that both of
these elements would be considered to be a single performance obligation and revenue would be recognised
over the two year term of customer contracts. the impact of this on the 2017 financial statements would be
to reduce revenue by $500,000.
AASB 9 Financial Instruments (December 2014)
AAsb 9 introduces new requirements for the classification and measurement of financial assets and
liabilities. these requirements improve and simplify the approach for classification and measurement of
financial assets compared with the requirements of AAsb 139.
the main changes are:
> financial assets that are debt instruments will be classified based on: (i) the objective of the entity’s
business model for managing the financial assets; and (ii) the characteristics of the contractual
cash flows;
> Allows an irrevocable election on initial recognition to present gains and losses on investments in equity
instruments that are not held for trading in other comprehensive income (instead of in profit or loss).
dividends in respect of these investments that are a return on investment can be recognised in profit or
loss and there is no impairment or recycling on disposal of the instrument;
>
introduces a ‘fair value through other comprehensive income’ measurement category for particular simple
debt instruments;
> financial assets can be designated and measured at fair value through profit or loss at initial recognition
if doing so eliminates or significantly reduces a measurement or recognition inconsistency that would arise
from measuring assets or liabilities, or recognising the gains and losses on them, on different bases; and
> where the fair value option is used for financial liabilities the change in fair value is to be accounted for
as follows:
– the change attributable to changes in credit risk are presented in Other comprehensive income (‘Oci’);
– the remaining change is presented in profit or loss; and
–
if this approach creates or enlarges an accounting mismatch in the profit or loss, the effect of the
changes in credit risk are also presented in profit or loss. Otherwise, the following requirements have
generally been carried forward unchanged from AAsb 139 into AAsb 9
48
notes to the Consolidated Financial Statements
3. ChAnGES In ACCOuntInG POLICIES (continued)
3.2 Accounting Standards issued but not yet effective and have not been adopted early
by the Group (continued)
AASB 16 Leases (February 2017)
AAsb 16:
> replaces AAsb 117 Leases and some lease-related interpretations;
> requires all leases to be accounted for ‘on-balance sheet’ by lessees, other than short-term and low value
asset leases;
> provides new guidance on the application of the definition of lease and on sale and lease back accounting;
>
largely retains the existing lessor accounting requirements in AAsb 117; and
> requires new and different disclosures about leases.
management has reviewed the applicable provisions relating to the group’s position as a lessor and lessee
under the new standard when it is first adopted for the year ending 30 June 2020.
in relation to the group being a lessor of operating leases of wearables under subscription arrangements
the standard is not expected to have a material impact on the transactions and balances recognised in the
financial statements.
in relation to the group being a lessee it is expected that the first-time adoption of AAsb 16 for the year
ending 30 June 2020 will have the following impact on the transactions and balances recognised in the
financial statements, in particular:
>
lease assets and financial liabilities on the balance sheet will increase by $6,219,735 and $4,243,379
respectively (based on the facts at the date of the assessment);
> there will be a reduction in the reported equity as the carrying amount of lease assets will reduce more
quickly than the carrying amount of lease liabilities;
> ebit in the statement of profit or loss and other comprehensive income will be higher as the implicit
interest in lease payments for former off balance sheet leases will be presented as part of finance costs
rather than being included in operating expenses; and
> operating cash outflows will be lower and financing cash flows will be higher in the statement of cash
flows as principal repayments on all lease liabilities will now be included in financing activities rather than
operating activities. interest can also be included within financing activities.
AASB 2016-1 Amendments to Australian Accounting Standards – Recognition of Deferred Tax Assets for
Unrealised Losses (1 January 2017)
AAsb 2016-1 amends AAsb 112 Income Taxes to clarify how to account for deferred tax assets related to debt
instruments measured at fair value, particularly where changes in the market interest rate decrease the fair
value of a debt instrument below cost.
when these amendments are first adopted for the year ending 30 June 2018, there will be no material
impact on the financial statements.
AASB 2016-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB
107 (1 January 2017)
AAsb 2016-2 amends AAsb 107 Statement of Cash Flows to require entities preparing financial statements
in accordance with tier 1 reporting requirements to provide disclosures that enable users of financial
Catapult Group International Limited Annual Report 2017
49
statements to evaluate changes in liabilities arising from financing activities, including both changes arising
from cash flows and non-cash changes.
when these amendments are first adopted for the year ending 30 June 2018, there will be no material
impact on the financial statements.
4.
SIGnIFICAnt ACCOuntInG POLICIES
4.1 Overall considerations
the consolidated financial statements have been prepared using the significant accounting policies and
measurement bases summarised below.
4.2 Basis of consolidation
the group financial statements consolidate those of the parent company and all of its subsidiaries as
of 30 June 2017. the parent controls a subsidiary if it is exposed, or has rights, to variable returns from its
involvement with the subsidiary and could affect those returns through its power over the subsidiary. All
subsidiaries have a reporting date of 30 June.
All transactions and balances between group companies are eliminated on consolidation, including unrealised
gains and losses on transactions between group companies. where unrealised losses on intra-group asset
sales are reversed on consolidation, the underlying asset is also tested for impairment from a group
perspective. Amounts reported in the financial statements of subsidiaries have been adjusted where
necessary to ensure consistency with the accounting policies adopted by the group.
profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are
recognised from the effective date of acquisition, or up to the effective date of disposal, as applicable.
non-controlling interests, presented as part of equity, represent the portion of a subsidiary’s profit or loss
and net assets that is not held by the group. the group attributes total comprehensive income or loss of
subsidiaries between the owners of the parent and the non-controlling interests based on their respective
ownership interests.
4.3 Business combination
the group applies the acquisition method in accounting for business combinations. the consideration
transferred by the group to obtain control of a subsidiary is calculated as the sum of the acquisition-date fair
values of assets transferred, liabilities incurred and the equity interests issued by the group, which includes
the fair value of any asset or liability arising from a contingent consideration arrangement. Acquisition costs
are expensed as incurred.
the group recognises identifiable assets acquired and liabilities assumed in a business combination
regardless of whether they have been previously recognised in the acquiree’s financial statements prior to
the acquisition. Assets acquired and liabilities assumed are generally measured at their acquisition-date
fair values.
goodwill is stated after separate recognition of identifiable intangible assets. it is calculated as the excess
of the sum of (a) fair value of consideration transferred, (b) the recognised amount of any non-controlling
interest in the acquire, and (c) acquisition-date fair value of any existing equity interest in the acquiree, over
the acquisition-date fair values of identifiable net assets. if the fair values of identifiable net assets exceed
the sum calculated above, the excess amount (i.e. gain on a bargain purchase) is recognised in profit or
loss immediately.
50
notes to the Consolidated Financial Statements
4.
SIGnIFICAnt ACCOuntInG POLICIES (continued)
4.4 Foreign currency translation
Functional and presentation currency
the consolidated financial statements are presented in Australian dollars (‘Aud’), which is also the functional
currency of the parent company.
Foreign currency transactions and balances
foreign currency transactions are translated into the functional currency of the respective group entity, using
the exchange rates prevailing at the dates of the transactions (spot exchange rate). foreign exchange gains
and losses resulting from the settlement of such transactions and from the re-measurement of monetary
items at year end exchange rates are recognised in profit or loss.
non-monetary items are not retranslated at year-end and are measured at historical cost (translated using
the exchange rates at the date of the transaction), except for non-monetary items measured at fair value
which are translated using the exchange rates at the date when fair value was determined.
Foreign operations
in the group’s financial statements, all assets, liabilities and transactions of group entities with a functional
currency other than the Aud are translated into Aud upon consolidation. the functional currency of the
entities in the group has remained unchanged during the reporting period.
On consolidation, assets and liabilities have been translated into Aud at the closing rate at the reporting
date. income and expenses have been translated into Aud at the average rate over the reporting period.
exchange differences are charged or credited to other comprehensive income and recognised in the currency
translation reserve in equity. On disposal of a foreign operation the cumulative translation differences
recognised in equity are reclassified to profit or loss and recognised as part of the gain or loss on disposal.
4.5 Revenue
Revenue arises from the sale of goods and the rendering of services, it is measured by reference to the fair
value of consideration received or receivable, excluding sales taxes, rebates, and trade discounts.
the group enters into sales transactions involving an outright sale to the client, on a subscription basis or for
the rendering of services. the group applies the revenue recognition criteria set out below to each separately
identifiable component of the sales transaction in order to reflect the substance of the transaction.
Outright sale of goods
Outright sale of goods is recognised when the group has transferred to the buyer the significant risks and
rewards of ownership. the timing of the transfer of risks and rewards varies depending on the individual
terms of the sales agreement. for sales of wearable units the transfer usually occurs when the customer has
taken undisputed delivery of the goods. for sales of hardware in the video analytics business the transfer
usually occurs on despatch of the goods from catapult’s premises.
Subscription and Services
(i) Wearables Subscription sale
the group generates revenues from subscription sales and once the customer has taken undisputed delivery
of the goods, the revenue from the subscription agreement is recognised on a monthly basis in equal amounts
for each month of the subscription agreement.
Catapult Group International Limited Annual Report 2017
51
in determining that wearable subscription constitute an operating lease under AAsb 117 the group
considers the nature of the term of the agreement and the useful life of the goods being provided under
the subscription agreement.
(ii) Rendering of Services
the group is involved in providing software, support and maintenances services. the group
recognises revenue from such activities on a monthly basis in equal amounts for each month of the
subscription agreement.
(iii) Multiple Element contracts
the group’s sub-elite wearables offering includes an ‘outright sale’ element for the gps tracking unit sold
to the customer and a ‘rendering of services’ element for the hosted software platform that customers have
access to over the duration of the sales agreement. the consideration received for the bundled offering is
allocated to each element on the basis of relative fair value. the fair value used for allocating revenue is based
on customer contracts and internal pricing models. the revenues associated with the ‘Outright sale’ and
‘Rendering of services’ elements of the sales agreements are recognised on the basis set-out above.
(iv) Content Licensing
the group is involved in the provision of licensed video content to customers. where video content is
purchased on a one-off basis associated revenue is recognised upon delivery of the licensed content. where
video content is purchased via a term contract with content available for consumption during the contract
term, associated revenue is recognised on a monthly basis in equal amounts for each month of the content
licensing agreement.
Interest and dividend income
interest income and expenses are reported on an accrual basis using the effective interest method. dividends,
other than those from investments in associates, are recognised at the time the right to receive payment
is established.
4.6 Operating expenses
Operating expenses are recognised in profit or loss upon utilisation of the service or at the date of their origin.
expenditure for warranties is recognised and charged against the associated provision when the related
revenue is recognised.
4.7 Borrowing costs
borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset are
capitalised during the period of time that is necessary to complete and prepare the asset for its intended use
or sale. Other borrowing costs are expensed in the period in which they are incurred and reported in finance
costs (see note 23).
4.8 Goodwill
goodwill represents the future economic benefits arising from a business combination that are not
individually identified and separately recognised. see note 4.3 for information on how goodwill is initially
determined. goodwill is carried at cost less accumulated impairment losses. Refer to note 14.1 for a
description of impairment testing procedures.
52
notes to the Consolidated Financial Statements
4.
SIGnIFICAnt ACCOuntInG POLICIES (continued)
4.9 Other intangible assets
Recognition of other intangible assets
Acquired intangible assets
Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and install
the specific software. brand names and customer lists acquired in a business combination that qualify for
separate recognition are recognised as intangible assets at their fair values (see note 4.3).
Internally developed software
expenditure on the research phase of projects to develop new customised software for athlete tracking and
analytic analysis is recognised as an expense as incurred.
costs that are directly attributable to a project’s development phase are recognised as intangible assets,
provided they meet the following recognition requirements:
> the development costs can be measured reliably;
> the project is technically and commercially feasible;
> the group intends to and has sufficient resources to complete the project;
> the group has the ability to use or sell the software; and
> the software will generate probable future economic benefits.
development costs not meeting these criteria for capitalisation are expensed as incurred.
directly attributable costs include employee costs and costs incurred on software development.
Internally developed hardware
expenditure on the research phase of projects to develop new hardware for athlete tracking and analytic
analysis is recognised as an expense as incurred.
costs that are directly attributable to a project’s development phase are recognised as intangible assets,
provided they meet the following recognition requirements:
> the development costs can be measured reliably;
> the project is technically and commercially feasible;
> the group intends to and has sufficient resources to complete the project;
> the group has the ability to use or sell the hardware; and
> the hardware will generate probable future economic benefits.
development costs not meeting these criteria for capitalisation are expensed as incurred.
directly attributable costs include employee costs and costs incurred on hardware development.
Subsequent measurement
All intangible assets, including capitalised internally developed software and hardware, are accounted for
using the cost model whereby capitalised costs are amortised on a straight-line basis over their estimated
useful lives, as these assets are considered finite. Residual values and useful lives are reviewed at each
reporting date. in addition, they are subject to impairment testing as described in note 4.12.
Catapult Group International Limited Annual Report 2017
53
the following useful lives are applied:
> software (licenses and internally developed): 4 – 5 years, except with regard to identified projects with
2 years;
> brand names: annually assessed by management for impairment;
> customer lists: 7 – 10 years;
> hardware: 3 years;
> distributor relationships: 10 years;
> distributor contracts: 10 years; and
> goodwill: annually assessed by management for impairment.
Amortisation has been included within depreciation, amortisation and impairment of non-financial assets.
subsequent expenditures on the maintenance of computer software and brand names are expensed
as incurred.
when an intangible asset is disposed of, the gain or loss on disposal is determined as the difference between
the proceeds and the carrying amount of the asset, and is recognised in profit or loss within other income or
other expenses.
4.10 Property, plant and equipment
Plant, IT equipment and other equipment
plant, it equipment and other equipment (comprising fittings and furniture) are initially recognised at
acquisition cost or manufacturing cost, including any costs directly attributable to bringing the assets to
the location and condition necessary for it to be capable of operating in the manner intended by the group’s
management. plant, it equipment and other equipment are subsequently measured using the cost model,
cost less subsequent precaution and impairment losses.
depreciation is recognised on a diminishing-value basis to write down the cost less estimated residual value
of plant buildings, it equipment and other equipment. the following useful lives are applied:
> plant 3-10 years;
> office equipment 3-20 years;
> fixture and fittings 20 years;
> other equipment 2-7 years; and
> property improvements 7 years.
depreciation is recognised on a straight line basis to write down the cost less estimated residual value of
subscription, service and demonstration wearable units over their useful life of 4 years.
in the case of leasehold property, expected useful lives are determined by reference to comparable owned
assets or over the term of the lease, if shorter.
material residual value estimates and estimates of useful life are updated as required, but at least annually.
gains or losses arising on the disposal of property, plant and equipment are determined as the difference
between the disposal proceeds and the carrying amount of the assets and are recognised in profit or loss
within other income or other expenses.
54
notes to the Consolidated Financial Statements
4.
SIGnIFICAnt ACCOuntInG POLICIES (continued)
4.11 Leased assets
Operating leases
where the group is a lessee, payments on operating lease agreements are recognised as an expense on a
straight-line basis over the lease term. Associated costs, such as maintenance and insurance, are expensed
as incurred.
4.12 Impairment testing of goodwill, other intangible assets and property, plant and equipment
for impairment assessment purposes, assets are grouped at the lowest levels for which there are largely
independent cash inflows (cash-generating units). As a result, some assets are tested individually for
impairment and some are tested at cash-generating unit level. goodwill is allocated to those cash-generating
units that are expected to benefit from synergies of the related business combination and represent the
lowest level within the group at which management monitors goodwill.
cash-generating units to which goodwill has been allocated (determined by the group’s management as
equivalent to its operating segments) are tested for impairment at least annually. All other individual assets
or cash-generating units are tested for impairment whenever events or changes in circumstances indicate
that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset’s or cash-generating unit’s carrying
amount exceeds its recoverable amount, which is the higher of fair value less costs to sell and value-in-use.
to determine the value-in-use, management estimates expected future cash flows from each cash-generating
unit and determines a suitable interest rate in order to calculate the present value of those cash flows.
the data used for impairment testing procedures are directly linked to the group’s latest approved budget,
adjusted as necessary to exclude the effects of future reorganisations and asset enhancements. discount
factors are determined individually for each cash-generating unit and reflect management’s assessment
of respective risk profiles, such as market and asset-specific risks factors.
impairment losses for cash-generating units reduce first the carrying amount of any goodwill allocated
to that cash-generating unit. Any remaining impairment loss is charged pro rata to the other assets in the
cash-generating unit. with the exception of goodwill, all assets are subsequently reassessed for indications
that an impairment loss previously recognised may no longer exist. An impairment charge is reversed if the
cash-generating unit’s recoverable amount exceeds its carrying amount.
4.13 Financial instruments
Recognition, Initial Measurement and De-recognition
financial assets and financial liabilities are recognised when the group becomes a party to the contractual
provisions of the financial instrument, and are measured initially at fair value adjusted by transactions
costs, except for those carried at fair value through profit or loss, which are measured initially at fair value.
subsequent measurement of financial assets and financial liabilities are described below.
financial assets are derecognised when the contractual rights to the cash flows from the financial asset
expire, or when the financial asset and all substantial risks and rewards are transferred. A financial liability
is derecognised when it is extinguished, discharged, cancelled or expires.
Catapult Group International Limited Annual Report 2017
55
Classification and Subsequent Measurement of Financial Assets
for the purpose of subsequent measurement, financial assets other than those designated and effective as
hedging instruments are classified into the following categories upon initial recognition:
> loans and receivables;
> financial assets at fair value through profit or loss (‘fvtpl’);
> held-to-maturity (‘htm’) investments; or
> Available-for-sale (‘Afs’) financial assets.
All financial assets except for those at fvtpl are subject to review for impairment at least at each reporting
date to identify whether there is any objective evidence that a financial asset or a group of financial assets is
impaired. different criteria to determine impairment are applied for each category of financial assets, which
are described below.
All income and expenses relating to financial assets that are recognised in profit or loss are presented within
finance costs, finance income or other financial items, except for impairment of trade receivables which is
presented within other expenses.
Loans and Receivables
loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market. After initial recognition, these are measured at amortised cost using the effective
interest method, less provision for impairment. discounting is omitted where the effect of discounting is
immaterial. the group’s cash and cash equivalents, trade and most other receivables fall into this category
of financial instruments.
individually significant receivables are considered for impairment when they are past due or when other
objective evidence is received that a specific counterparty will default. Receivables that are not considered
to be individually impaired are reviewed for impairment in groups, which are determined by reference to
the industry and region of a counterparty and other shared credit risk characteristics. the impairment loss
estimate is then based on recent historical counterparty default rates for each identified group.
Classification and subsequent measurement of Financial Liabilities
the group’s financial liabilities include borrowings, trade and other payables and derivative
financial instruments.
financial liabilities are measured subsequently at amortised cost using the effective interest method, except
for financial liabilities held for trading or designated at fvtpl, that are carried subsequently at fair value
with gains or losses recognised in profit or loss. All derivative financial instruments that are not designated
and effective as hedging instruments are accounted for at fvtpl.
Derivative financial instruments and hedge accounting
derivative financial instruments are accounted for at fvtpl except for derivatives designated as hedging
instruments in cash flow hedge relationships, which requires a specific accounting treatment.
4.14 Inventories
inventories are stated at the lower of cost and net realisable value. cost includes all expenses directly
attributable to the manufacturing process as well as suitable portions of related production overheads,
based on normal operating capacity. costs of ordinarily interchangeable items are assigned using the first in,
first out cost formula. net realisable value is the estimated selling price in the ordinary course of business less
any applicable selling expenses.
56
notes to the Consolidated Financial Statements
4.
SIGnIFICAnt ACCOuntInG POLICIES (continued)
4.15 Income taxes
tax expense recognised in profit or loss comprises the sum of deferred tax and current tax not recognised
in other comprehensive income or directly in equity.
current income tax assets and/or liabilities comprise those obligations to, or claims from, the Australian
taxation Office (‘AtO’) and other fiscal authorities relating to the current or prior reporting periods that are
unpaid at the reporting date. current tax is payable on taxable profit, which differs from profit or loss in the
financial statements. calculation of current tax is based on tax rates and tax laws that have been enacted
or substantively enacted by the end of the reporting period.
deferred income taxes are calculated using the liability method on temporary differences between the
carrying amounts of assets and liabilities and their tax bases. however, deferred tax is not provided on
the initial recognition of goodwill or on the initial recognition of an asset or liability unless the related
transaction is a business combination or affects tax or accounting profit. deferred tax on temporary
differences associated with investments in subsidiaries and joint ventures is not provided if reversal of these
temporary differences can be controlled by the group and it is probable that reversal will not occur in the
foreseeable future.
deferred tax assets and liabilities are calculated, without discounting, at tax rates that are expected to apply
to their respective period of realisation, provided they are enacted or substantively enacted by the end of the
reporting period.
deferred tax assets are recognised to the extent that it is probable that they will be able to be utilised
against future taxable income, based on the group’s forecast of future operating results which is adjusted
for significant non-taxable income and expenses and specific limits to the use of any unused tax loss or credit.
deferred tax liabilities are always provided for in full.
deferred tax assets and liabilities are offset only when the group has a right and intention to set off current
tax assets and liabilities from the same taxation authority.
changes in deferred tax assets or liabilities are recognised as a component of tax income or expense in profit
or loss, except where they relate to items that are recognised in other comprehensive income (such as the
revaluation of land) or directly in equity, in which case the related deferred tax is also recognised in other
comprehensive income or equity, respectively.
catapult group international ltd and its wholly-owned Australian controlled entities have implemented the
tax consolidation legislation. As a consequence, these entities are taxed as a single entity and the deferred
tax assets and liabilities of these entities are set off in the consolidated financial statements.
4.16 Cash and cash equivalents
cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term,
highly liquid investments that are readily convertible into known amounts of cash and which are subject to
an insignificant risk of changes in value.
4.17 Equity, reserves and dividend payments
share capital represents the fair value of shares that have been issued. Any transaction costs associated with
the issuing of shares are deducted from share capital, net of any related income tax benefits.
Other components of equity include the following:
> foreign currency translation reserve – comprises foreign currency translation differences arising on the
translation of financial statements of the group’s foreign entities into Aud (see note 4.4); and
> share option reserve – comprises the grant date fair value of options issued but not exercised.
Catapult Group International Limited Annual Report 2017
57
Retained earnings include all current and prior period retained profits.
dividend distributions payable to equity shareholders are included in other liabilities when the dividends have
been approved in a general meeting prior to the reporting date.
All transactions with owners of the parent are recorded separately within equity.
4.18 Post-employment benefits and short-term employee benefits
Post-employment Benefit Plans
the group provides post-employment benefits through defined contribution plans.
Short-term Employee Benefits
short-term employee benefits are benefits, other than termination benefits, that are expected to be settled
wholly within twelve (12) months after the end of the period in which the employees render the related
service. examples of such benefits include wages and salaries, non-monetary benefits and accumulating sick
leave. short-term employee benefits are measured at the undiscounted amounts expected to be paid when
the liabilities are settled.
4.19 Share-based employee remuneration
the group operates equity-settled share-based remuneration plans for its employees. none of the group’s
plans feature any options for a cash settlement.
All goods and services received in exchange for the grant of any share-based payment are measured at
their fair values. where employees are rewarded using share-based payments, the fair values of employees’
services are determined indirectly by reference to the fair value of the equity instruments granted. this fair
value is appraised at the grant date and excludes the impact of non-market vesting conditions (for example
performance conditions).
All share-based remuneration is ultimately recognised as an expense in profit or loss with a corresponding
credit to share option reserve. if vesting periods or other vesting conditions apply, the expense is allocated
over the vesting period, based on the best available estimate of the number of share options expected
to vest.
non-market vesting conditions are included in assumptions about the number of options that are expected
to become exercisable. estimates are subsequently revised if there is any indication that the number of share
options expected to vest differs from previous estimates. Any cumulative adjustment prior to vesting is
recognised in the current period. no adjustment is made to any expense recognised in prior periods if share
options ultimately exercised are different to that estimated on vesting.
upon exercise of share options, the proceeds received net of any directly attributable transaction costs are
allocated to share capital.
4.20 Provisions, contingent liabilities and contingent assets
provisions for product warranties, legal disputes, onerous contracts or other claims are recognised when the
group has a present legal or constructive obligation as a result of a past event, it is probable that an outflow
of economic resources will be required from the group and amounts can be estimated reliably. timing or
amount of the outflow may still be uncertain.
Restructuring provisions are recognised only if a detailed formal plan for the restructuring has been
developed and implemented, or management has at least announced the plan’s main features to those
affected by it. provisions are not recognised for future operating losses.
58
notes to the Consolidated Financial Statements
4.
SIGnIFICAnt ACCOuntInG POLICIES (continued)
4.20 Provisions, contingent liabilities and contingent assets (continued)
provisions are measured at the estimated expenditure required to settle the present obligation, based on
the most reliable evidence available at the reporting date, including the risks and uncertainties associated
with the present obligation. where there are a number of similar obligations, the likelihood that an outflow
will be required in settlement is determined by considering the class of obligations as a whole. provisions are
discounted to their present values, where the time value of money is material.
Any reimbursement that the group can be virtually certain to collect from a third party with respect to
the obligation is recognised as a separate asset. however, this asset may not exceed the amount of the
related provision.
no liability is recognised if an outflow of economic resources as a result of present obligation is not probable.
such situations are disclosed as contingent liabilities, unless the outflow of resources is remote in which case
no liability is recognised.
4.21 Goods and Services Tax, Sales taxes and Value Added Tax (GST)
Revenues, expenses and assets are recognised net of the amount of gst, except where the amount of
gst incurred is not recoverable from the appropriate tax authority in the relevant tax jurisdiction. in these
circumstances the gst is recognised as part of the cost of acquisition of the asset or as part of an item of
the expense. Receivables and payables in the statement of financial position are shown inclusive of gst.
cash flows are presented in the statement of cash flows on a gross basis, except for the gst components
of investing and financing activities, which are disclosed as operating cash flows.
4.22 Significant management judgement in applying accounting policies
when preparing the financial statements, management undertakes a number of judgements, estimates and
assumptions about the recognition and measurement of assets, liabilities, income and expenses.
Significant management judgement
the following are significant management judgements in applying the accounting policies of the group that
have the most significant effect on the financial statements.
Recognition of subscription revenue and rental units
determining when to recognise revenues from subscription agreements requires an understanding of the
customer’s use and the useful life of the products, historical experience and knowledge of the market. the
company provides gps tracking units for team sports under both an up-front sales model and a subscription
model. under the subscription model, the customer has the right to use the gps tracking units for the
period of the subscription, however must return the unit to the group at the end of the subscription period.
management have considered various factors under AAsb 117 Leases as to whether a component of the
subscription agreements represents a finance or operating lease. these include:
> the gps tracking units for the majority of subscription contracts have a subscription period no more than
75% of the useful life of the units; and
> Risk in the fair wear and tear of gps tracking units remains with the group.
As a result this component of the subscription agreements has been considered an operating lease with the
group as lessor. As such, those gps tracking units provided under subscription agreements have been capitalised
as ‘Rental units’ under property, plant and equipment and are amortised over their estimated useful life.
All revenue under subscription sales is therefore recognised on a straight-line basis over the term of the
subscription period, reflecting management’s best estimate of the delivery of services and provision of the
rental units over the term of the agreements.
Catapult Group International Limited Annual Report 2017
59
Recognition of deferred tax assets
the extent to which deferred tax assets can be recognised is based on an assessment of the probability
of the group’s future taxable income against which the deferred tax assets can be utilised, as described in
note 16. in addition, significant judgement is required in assessing the impact of any legal or economic limits
or uncertainties in various tax jurisdictions.
Estimation uncertainty
information about estimates and assumptions that have the most significant effect on recognition
and measurement of assets, liabilities, income and expenses is provided below. Actual results may be
substantially different.
Impairment
in assessing impairment, management estimates the recoverable amount of each asset or cash-generating
unit based on expected future cash flows and uses an interest rate to discount them. estimation uncertainty
relates to assumptions about future operating results and the determination of a suitable discount rate (see
note 4.12).
Useful lives of depreciable assets
management reviews its estimate of the useful lives of depreciable assets at each reporting date, based on
the expected utility of the assets. uncertainties in these estimates relate to technical obsolescence that may
change the utility of certain software and it equipment.
Inventories
management estimates the net realisable values of inventories, taking into account the most reliable evidence
available at each reporting date. the future realisation of these inventories may be affected by future
technology or other market-driven changes that may reduce future selling prices.
Business combinations
management uses valuation techniques in determining the fair values of the various elements of a business
combination (see note 4.3). particularly, the fair value of contingent consideration is dependent on the
outcome of many variables that affect future profitability (see note 5).
4.23 Going concern
the financial statements have been prepared on the basis that the consolidated entity is a going concern,
which assumes continuity of normal business activities and the realisation of assets and the settlement of
liabilities in the ordinary course of business.
the consolidated group incurred a loss after tax of $13,581,000 and had net cash outflow from operating
activities of $8,844,000.
notwithstanding this, the directors are of the view that the going concern principle is appropriate due to the
following factors:
> the consolidated entity has continued to successfully secure sale arrangements with many leading
sporting organisations across the world for which revenues and cash inflows will be recognised in future
reporting periods;
> the business has put in place appropriate staffing globally to execute the growth strategy outlined in the
may 2017 capital raising; and
> the acquisition of XOs brings a mature, cash generating entity into the group enabling the consolidated
operation to finance its day to day operations more effectively, better balance profitability with
investment, and provide additional capital to fund strategic growth opportunities.
60
notes to the Consolidated Financial Statements
5. ACquISItIOnS AnD DISPOSALS
the group acquired two business’s during the financial year, kodaplay ltd and XOs technologies inc. details
of these acquisitions are further disclosed in note 34 and note 35 respectively.
6.
IntEREStS In SuBSIDIARIES
set out below details of the subsidiaries held directly by the group:
Parent Entity
catapult group international limited(i),(iii)
Group Ownership
Interests
Principal Activity
30 June 17 30 June 16
Name of the Subsidiary
Principal Place
of Business
catapult sports pty ltd(i),(ii),(iii)
Australia
catapult gameday pty ltd
Australia
design and sale of wearable
products and software
trading entity for relationships
with media sector
catapult international pty ltd(ii) Australia
holding company
gpsports systems pty ltd(iii)
Australia
design and sale of wearable
products and software
catapult innovations pty ltd
Australia
non trading entity
catapult group us inc.(iii)
catapult sports llc(iii)
XOs technologies inc
collegiate images llc
catapult sports limited(iii)
united states
of America
holding company
united states
of America
north American sales
Operations
video Analytics
content licensing
united states
of America
united states
of America
united
kingdom
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
nil
nil
european sales Operations
100%
100%
catapult sports godo kaisha
Japan
Asia sales Operations
catapult eu ltd
kodaplay ltd(iii)
ireland
ireland
holding company
manufacturing and selling for
catapult consumer products
100%
100%
100%
100%
nil
nil
(i) Catapult Group International Limited (the Company) and Catapult Sports Pty Ltd (the ‘Closed Group’) entered into a Deed of Cross
Guarantee on 26 June 2017. The effect of the deed is that the Company has guaranteed to each creditor to pay any deficiency in
the event of the winding up of any of the controlled entities in the ‘Closed Group’. All entities in the ‘Closed Group’ have also given a
similar guarantee in the event that the Company is wound up refer to Note 36.
(ii) Pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785 Order 98/1418 (as amended) relief has been
granted to Catapult Sports Pty Ltd from the Corporations Act 2001 requirements for preparation, audit and lodgement of financial
reports and directors reports.
(iii) These entities have provided guarantees to Western Alliance Bank in respect of credit facilities of USD 6,000,000 granted to XOS
Technologies Inc and Collegiate Images LLC.
Catapult Group International Limited Annual Report 2017
61
7.
SEGmEnt REPORtInG
For the year ended 30 June 2017
management identifies its operating segments based on the group’s business units which represent the main
products and services provided by the group. the group’s two main operating segments are:
> wearables: design, development and supply of wearable technology and analytic software to athletes and
sports teams; and
> video Analytics: develops and provides innovative digital and video analytic software solutions to elite
sports teams.
these operating segments are monitored and strategic decisions are made on the basis of adjusted segment
operating results. the basis of segmentation has changed since the prior period where only one segment
was identified. prior year comparative data cannot be provided for operating segment ebitdA and profit as
such data was not collated prior to the introduction of the current accounting software used by the group
introduced in december 2015. the geographical revenue analysis is included to provide comparative results
with the prior corresponding period in a format consistent with prior periods.
the revenues and profit generated by each of the group’s operating segments and segment assets are
summarised as follows:
12 months to 30 June 2017
Revenue – external customers
segment ebitdA
segment Operating profit
segment Assets
segment liabilities
12 months to 30 June 2016
Revenue – external customers
segment Assets
segment liabilities
Wearables
$’000
Video
Analytics
$’000
27,443
33,340
2,861
(1,914)
9,025
3,124
Total
$’000
60,783
11,886
1,210
56,774
104,524
161,298
25,092
21,444
161,298
Wearables
$’000
Video
Analytics
$’000
17,368
30,151
18,212
–
–
–
Total
$’000
17,368
30,151
18,212
62
notes to the Consolidated Financial Statements
7.
SEGmEnt REPORtInG (continued)
the group’s segment operating loss reconciles to the group’s loss before tax as presented in its financial
statements as follows:
Total reporting segment operating EBITDA
depreciation and Amortisation for the segments
finance segment costs
finance segment income
Other financial segment cost
Total reporting segment operating loss
corporate costs
employee benefits expense
employee share option compensation expense
capital raising and listing expenses
travel, marketing and promotion
Occupancy
professional fees
Total Corporate Costs
finance income
Other financial items
Group loss before tax
Revenue by Geography
2017
$’000
11,886
(9,994)
(21)
114
(775)
1,210
(5,608)
(3,256)
(1,048)
(930)
(3,050)
(1,707)
(15,599)
(47)
390
(14,046)
the group’s revenues from external customers (excludes government grants) and are divided into the
following geographical areas:
Revenue – external customers
Australia
ApAc
emeA
usA
Total
Wearables
Video
Analytics
Total
2017
$’000’s
2017
$’000’s
2017
$’000’s
4,125
2,509
9,857
10,952
27,443
–
–
–
33,340
33,340
4,125
2,509
9,857
44,292
60,783
Catapult Group International Limited Annual Report 2017
63
Revenue – external customers
Australia
ApAc
emeA & latin America*
usA
Total
Wearables
Video
Analytics
Total
2016
$’000’s
2016
$’000’s
2016
$’000’s
2,771
2,311
5,448
6,839
17,369
–
–
–
–
–
2,771
2,311
5,448
6,839
17,369
All revenue is generated from external customers and there is no inter segment revenues.
*
EMEA – Europe Middle East & Africa
8.
REvEnuE
Revenue has been generated from the following types of sales transactions:
capital revenue
subscription and service
Other revenues
Total revenue
9. OthER InCOmE
Other income has been generated from the following sources:
government grants – emdg
government grants – R & d tax offset
Other income
Total other income
2017
$’000
17,220
42,973
590
2016
$’000
8,132
9,175
61
60,783
17,368
2017
$’000
2016
$’000
131
–
84
215
120
1,018
194
1,332
A further amount of government grants from R & d tax offsets of $nil (2016: $1,149,184) were recognised as
a reduction in intangibles, based on the proportion of development costs capitalised.
64
notes to the Consolidated Financial Statements
10. CASh AnD CASh EquIvALEntS
cash and cash equivalents include the following components:
Cash at bank and in hand
Aud
euR
gbp
usd
Jpy
2017
$’000
8,896
403
1,252
6,132
3
2016
$’000
1,842
292
89
1,420
–
Total cash and cash equivalents
16,686
3,643
the amount of cash and cash equivalents inaccessible to the group as at 30 June 2017 amounts to $279,089
(2016: $288,828) relating to letter of credits for rental leases held by the company.
11. tRADE AnD OthER RECEIvABLES
trade and other receivables consist of the following:
trade receivables, gross
Accrued Revenue
Allowance for credit losses
Trade receivables
social security and other taxes
Other receivables
prepayments
Non-financial assets
Total current trade and other receivables
Other long-term financial assets
Total trade and other receivables
2017
$’000
23,129
2,133
(251)
2016
$’000
6,964
–
(7)
25,011
6,957
224
141
1,488
1,853
26,864
208
745
145
511
1,401
8,358
46
27,072
8,404
the net carrying value of trade receivables is considered a reasonable approximation of fair value.
All of the group’s trade and other receivables have been reviewed for indicators of impairment. An amount of
$251,172 (2016: $6,566) was found to be impaired and subsequently an allowance for credit losses has been made.
Catapult Group International Limited Annual Report 2017
65
12.
InvEntORIES
Raw materials and consumables
work in progress
finished goods
Total inventories
2017
$’000
2016
$’000
667
44
2,631
3,342
738
11
1,355
2,104
in 2017, total costs of $13,093,595 associated with inventories was included in the consolidated statement
of profit and loss and Other comprehensive income as an expense (2016: $2,103,545). during the financial
year a balance of $336,317 (2016: $nil) was incurred regarding a write down of inventories associated with
a change in device models and obsolescence of raw materials.
13. PROPERtY, PLAnt AnD EquIPmEnt
details of the group’s property, plant and equipment and their carrying amount are as follows:
Gross carrying amount
balance 1 July 2016
Acquisition through business
combination
Additions
disposals
net exchange differences
Rental
& Demo
Units
$’000
Plant &
Equip-
ment
$’000
Furniture
& Fittings
$’000
Office
Equip-
ment
$’000
Leasehold
Improve-
ments
$’000
4,460
–
3,559
–
(1)
821
10
804
(73)
(39)
11
19
94
(7)
(4)
249
453
653
–
(4)
219
31
811
–
(15)
Total
$’000
5,761
513
5,921
(80)
(63)
Balance 30 June 2017
8,018
1,523
113
1,351
1,046
12,052
Depreciation and impairment
balance 1 July 2016
depreciation
disposals
net exchange differences
(1,097)
(1,993)
–
–
(363)
(227)
55
64
balance 30 June 2017
(3,090)
(471)
Carrying amount 30 June 2017
4,928
1,052
(1)
(11)
–
7
(5)
108
(48)
(387)
2
7
(426)
925
(55)
(1,565)
(319)
(2,937)
–
25
57
103
(349)
(4,342)
697
7,710
66
notes to the Consolidated Financial Statements
13. PROPERtY, PLAnt AnD EquIPmEnt (continued)
Gross carrying amount
balance 1 July 2015
Additions
disposals
net exchange differences
Rental
& Demo
Units
$’000
Plant &
Equip-
ment
$’000
Furniture
& Fittings
$’000
Office
Equip-
ment
$’000
Leasehold
Improve-
ments
$’000
1,834
2,626
–
–
510
313
–
(2)
4
7
–
–
130
119
–
–
219
–
–
–
Total
$’000
2,698
3,065
–
(2)
Balance 30 June 2016
4,460
821
11
249
219
5,761
Depreciation and impairment
balance 1 July 2015
depreciation
balance 30 June 2016
(297)
(800)
(1,097)
Carrying amount 30 June 2016
3,363
(177)
(186)
(363)
458
(1)
–
(1)
10
(21)
(27)
(48)
201
(30)
(25)
(55)
(526)
(1,039)
(1,565)
164
4,196
All depreciation and impairment charges are included within depreciation and amortisation expense. the
group wrote back $nil (2016: $nil) worth of rental units which had been fully depreciated and subsequently
upgraded to the new device under catapult’s subscription agreements. there were no material contractual
commitment to acquire property, plant and equipment at 30 June 2017 (2016: $nil)
14. GOODWILL
the movements in the net carrying amount of goodwill are as follows:
balance 1 July
Acquired through business combinations
foreign exchange effect on goodwill
Balance 30 June
2017
$’000
1,213
51,824
90
2016
$’000
1,213
–
–
53,127
1,213
Catapult Group International Limited Annual Report 2017
67
14.1 Impairment Testing
for the purpose of annual impairment testing goodwill is allocated to the cash-generating units which
expected to benefit from the synergies of the business combinations in which goodwill arises.
elite wearables
sub-elite wearables
video Analytics
Goodwill allocation at 30 June
2017
$’000
1,213
3,866
48,048
53,127
2016
$’000
1,213
–
–
1,213
the recoverable amounts of the cash-generating units were determined based on value-in-use calculations,
covering detailed five-year forecast, followed by a terminal growth rate of expected cash flows for the units.
growth rates are determined by management. the present value of the expected cash flows of each segment
is determined by applying a suitable discount rate.
in measuring value in use cash flow projections are based on:
(a) reasonable and supportable assumptions that represent management’s best estimate of the range of
economic conditions that will exist over the remaining useful life of the asset;
(b) most recent financial budgets/forecasts approved by management, but exclude any estimated future
cash inflows or outflows expected to arise from future restructurings or from improving or enhancing
the asset’s performance; and
(c) estimates cash flow projections beyond the period covered by the most recent budgets/forecasts by
extrapolating the projections based on the budgets/forecasts using a steady or declining growth rate
for subsequent years.
EBITDA growth rate
(CAGR FY18 – FY22) (i)
Terminal value
growth rate
Discount Rates
2017
22%
280%
10%
2016
10%
n/a
n/a
2017
3.6%
3.3%
3.5%
2016
3.6%
n/a
n/a
2017
11.2%
11.4%
10.9%
2016
13.8%
n/a
n/a
elite wearables
sub-elite wearables
video Analytics
(i) Compound Annual Growth Rate (CAGR)
68
notes to the Consolidated Financial Statements
14. GOODWILL (continued)
14.1 Impairment Testing (continued)
management have identified that a reasonably possible change in two key assumptions could cause the
carrying amount of some of the cgus to exceed the recoverable amount. the following table shows the
amount by which the assumptions would need to change individually for the estimated recoverable amount
to be equal to the carrying amount.
In percent
elite wearables
sub-elite wearables
video Analytics
Brand names
Change Required for
carrying amount to equal
recoverable amount
EBITDA
Growth
Rate
Discount
Rate
3%
19%
5%
10.1%
7.6%
1.2%
the carrying value of brand names associated with each cash generating unit of the group are outlined below:
elite wearables
sub-elite wearables
video Analytics
Brand names as at 30 June
2017
$’000
250
–
4,677
4,927
2016
$’000
250
–
–
250
Catapult Group International Limited Annual Report 2017
69
14.2 Growth Rates
five years of cash flows were included in the discounted cash flow model. the cash flow projections included
specific estimates for five years and a terminal growth rate thereafter. the terminal growth rate was
determined based on management’s estimate of the long-term compound annual ebitdA growth rate,
consistent with the assumptions that a market participant would make.
ebitdA was estimated taking into account past experience, adjusted as follows.
> Revenue growth was projected taking into account the average growth levels experienced over the past
five years and the estimated sales volume and price growth for the next five years. it was assumed that
the sales price would increase in line with forecast inflation over the next five years;
> significant one-off environmental costs have been factored into the budgeted ebitdA, reflecting various
potential regulatory developments in a number of european countries in which the cgu operates. Other
environmental costs are assumed to grow with inflation in other years; and
> estimated cash flows related to a restructuring that is expected to be carried out in 2017 were reflected
in the budgeted ebitdA.
the growth rates reflect a conservative management estimate, as publicly published growth rates for this
industry segment are not readily available.
14.3 Discount Rates
the discount rate reflects appropriate adjustments relating to market risk and specific risk factors of the
business unit.
the discount rate was a post-tax measure estimated based on the historical industry average weighted-
average cost of capital.
70
notes to the Consolidated Financial Statements
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Catapult Group International Limited Annual Report 2017
71
16. DEFERRED tAx ASSEtS AnD LIABILItIES
deferred taxes arising from temporary differences and unused tax losses can be summarised as attributable
to the following:
Deferred Tax Liabilities/(Assets)
Deferred Tax Assets
deferred revenue
property, plant and equipment
provision for annual leave
provision for long service leave
Other employee obligations
professional fees and doubtful
debts
Other provisions
tax losses
section 40-880 expenditure
Deferred Tax Liabilities
Other intangible assets
(282)
property, plant and equipment
capitalised R&d
foreign exchange
–
–
–
(282)
Recognised
directly
in equity
$’000
Recognised
in Business
Combination
$’000
Recognised
in Profit
& Loss
$’000
1 July 16
$’000
30 June 17
$’000
–
1
142
72
97
–
19
3,680
489
4,500
–
–
–
–
–
–
–
–
1,385
1,385
–
–
–
–
–
–
–
–
–
–
–
–
3,677
–
3,677
–
(1)
75
(7)
171
45
197
570
(445)
605
–
–
217
65
268
45
216
7,927
1,429
10,167
(1,959)
(1,327)
(3,568)
–
–
–
–
(865)
324
–
(865)
324
(1,959)
(1,868)
(4,109)
Deferred Tax Movement
1,385
1,718
(1,263)
72
notes to the Consolidated Financial Statements
16. DEFERRED tAx ASSEtS AnD LIABILItIES (continued)
Deferred Tax Liabilities/(Assets)
Deferred Tax Assets
property, plant and equipment
provision for annual leave
provision for long service leave
Other employee obligations
Other provisions
tax losses
section 40-880 expenditure
Deferred Tax Liabilities
Other intangible assets
foreign exchange
Deferred Tax Movement
Recognised
directly in
equity
$’000
Recognised
in Business
Combination
$’000
Recognised
in Profit
& Loss
$’000
1 July 15
$’000
30 June 16
$’000
1
106
42
121
37
1,114
582
2,003
(314)
–
(314)
–
–
–
–
–
–
80
80
–
–
–
80
–
–
–
–
–
–
–
–
–
–
–
–
–
36
30
(24)
(18)
2,566
(173)
2,417
32
–
32
2,449
1
142
72
97
19
3,680
489
4,500
(282)
–
(282)
the amounts recognised in other comprehensive income relate to exchange differences on translating
foreign operations. see note 25 for the amount of the income tax relating to these components of other
comprehensive income.
All deferred tax assets (including tax losses and other tax credits) have been recognised in the statement
of financial position.
17. tRADE AnD OthER PAYABLES
trade and other payables consist of the following:
Current:
trade payables
Total Trade and other payables
2017
$’000
2016
$’000
8,542
8,542
5,710
5,710
All amounts are short-term. the carrying values of trade payables and other payables are considered to be a
reasonable approximation of fair value.
Catapult Group International Limited Annual Report 2017
73
18. DEFERRED REvEnuE AnD OthER LIABILItIES
deferred Revenue and Other liabilities consist of the following:
Deferred Revenue
Advances received for future service work
deferred gain (lease incentive)
Other
Other liabilities – Current
deferred gain (lease incentive)
Other liabilities – Non-Current
deferred revenue
Deferred revenue – Non-Current
2017
$’000
2016
$’000
22,380
7,927
2017
$’000
2016
$’000
364
142
618
1,125
395
395
698
698
134
140
416
690
–
–
260
260
the deferred gain relates to the lease incentives associated with the Aurora lane and chicago premises
commencing march 2014 and may 2016 respectively. the excess of proceeds received over fair value was
deferred and is being amortised over the lease term of each lease. in 2017, deferred gain of $157,961
(2016: $67,277) was recognised in profit or loss relating to this transaction. the subsequent leasing agreement
is treated as an operating lease. the non-current part of the deferred gain will be amortised between 2017
and the end each lease term.
All amounts recognised relating to deferred revenue are assessed for current versus non-current classification
and are applied to revenue as recognised in relation to the timing of the client contract. the group expects to
recognise $22,380,381 of deferred revenue during fy 2018, with the balance falling into fy 2019 and 2020.
74
notes to the Consolidated Financial Statements
19. FInAnCIAL ASSEtS AnD LIABILItIES
19.1 Categories of financial assets and liabilities
note 4.13 provides a description of each category of financial assets and financial liabilities and the related
accounting policies. the carrying amounts of financial assets and financial liabilities in each category are
as follows:
30 June 2017
Financial assets
Other long-term financial assets
trade and other receivables
cash and cash equivalents
30 June 2017
Financial liabilities
trade and other payables
borrowings
30 June 2016
Financial assets
Other long-term financial assets
trade and other receivables
cash and cash equivalents
Notes
Loans and
receivables
$’000
(carried at
amortised cost)
Other
assets
$’000
(carried at
amortised cost
11
11
10
Notes
17
19.2
Notes
11
11
10
208
25,011
–
25,219
–
–
16,686
16,686
Other
Liabilities
$’000
(carried at
amortised cost)
Other
Liabilities
at FVTPL
$’000
(carried at
fair value)
8,542
3,252
11,794
–
–
–
Loans and
receivables
$’000
(carried at
amortised cost)
Other
assets
$’000
(carried at
amortised cost
46
6,957
–
7,003
–
–
3,643
3,643
Total
$’000
208
25,011
16,686
41,905
Total
$’000
8,542
3,252
11,794
Total
$’000
46
6,957
3,643
10,646
Catapult Group International Limited Annual Report 2017
75
30 June 2016
Financial liabilities
trade and other payables
Other
Liabilities
$’000
(carried at
amortised cost)
Other
Liabilities
at FVTPL
$’000
(carried at
fair value)
Total
$’000
5,710
5,710
–
–
5,710
5,710
Note
17
the carrying amount of the following financial assets and liabilities is considered a reasonable approximation
of fair value:
> trade and other receivables;
> other long term financial assets;
> cash and cash equivalents; and
> trade and other payables.
19.2 Borrowings
borrowings include the following financial liabilities:
Financial Liabilities
At amortised cost:
us-dollar loans
2017
$’000
Current
2016
$’000
Non-Current
2017
$’000
2016
$’000
3,141
3,141
–
–
–
–
–
–
Borrowings at amortised cost
Other bank borrowings are secured by land and buildings owned by the group. current interest rates are
variable and average 5.50% (2016: nil). the carrying amount of the other bank borrowings is considered to
be a reasonable approximation of the fair value.
76
notes to the Consolidated Financial Statements
20. EmPLOYEE REmunERAtIOn
20.1 Employee benefits expense
expenses recognised for employee benefits are analysed below:
wages and salaries
social security costs
share-based payments
superannuation – defined contribution plans
2017
$’000
26,517
874
3,256
1,010
2016
$’000
9,900
519
290
647
Employee benefits expense
31,657
11,356
20.2 Share-base employee remuneration
catapult has continued to utilise its established employee share plan (employee plan) to assist in the
motivation, retention and reward of executives and employees. the employee plan is designed to align the
interests of employees with the interests of shareholders by providing an opportunity for eligible employees
(including any person who is a full-time or permanent part-time employee or officer, or director of catapult
or any related body corporate of catapult) to receive an equity interest in catapult through the granting of
Options, performance Rights or other Awards.
the shares held by the employee plan trustee are Restricted securities such that the employee plan trustee
is not able to dispose of them within 24 months of Official Quotation. the key terms of the employee plan
are set out below:
Eligibility
eligibility to participate in the employee plan and the number of Options, performance Rights or other
Awards offered to each individual participant, will be determined by the board.
Grants
under the rules of the employee plan, Options, performance Rights and/or other Awards may be offered
or granted to eligible employees of catapult or any related body corporate of catapult from time to time,
subject to the discretion of the board.
Terms and conditions
the board has the discretion to set the terms and conditions (including conditions in relation to vesting,
disposal restrictions or forfeiture and any applicable exercise price) on which it will offer or grant Options,
performance Rights or other Awards under the employee plan and may set different terms and conditions
which apply to different participants in the employee plan. the board will determine the procedure for
offering or granting Options, performance Rights and/or other Awards (including the form, terms and
content of any offer, invitation or acceptance procedure) in accordance with the rules of the employee plan.
Vesting conditions
Options and performance Rights and other Awards will vest and become exercisable to the extent that the
applicable performance, service, or other vesting conditions specified at the time of the grant are satisfied
Catapult Group International Limited Annual Report 2017
77
(collectively the ‘vesting conditions’). vesting conditions may include conditions relating to continuous
employment or service, the individual performance of the participant and/or catapult’s performance and
the exercise price (if any) being less than the current market price of the underlying share as at vesting.
typically, the vesting conditions must be satisfied within a predetermined vesting period.
both the vesting conditions and the vesting period are set by the board in its discretion, and may be waived
by the board in its discretion.
Vesting period for Options
for Options granted prior to the Original prospectus date, board has in not altered the vesting periods
for Options granted prior to the Original prospectus date, with the exception of 57,500 Options which the
service conditions were waived during the last financial year and the shares were excercised during the
current financial year, under the discretion of the board.
for Options granted during the current financial period, the board has retained a general policy of 3 years
from the Options grant date. Of the Options issued during the year, the board made exceptions to a total
of 6,600,000 Options, where their vesting periods permitted partial vesting of the Options granted on the
annual anniversary over a three – five year period.
Vesting period for Performance Rights
the board has set a vesting period for the grant of the performance Rights prior to the Original prospectus
date and for the offer of performance Rights to eligible employees pursuant to the employee Offer under
the prospectus as 3 years from the date on which the performance Rights are granted.
for performance rights on issue, the board has not altered the vesting periods with the exception of 25,000
performance rights for which the service conditions were waived during the last financial year and the shares
were excercised during the current financial year, under the discretion of the board.
shares issued (including shares issued upon exercise of Options or performance Rights granted) under the
employee plan will rank equally in all respects with the other issued shares.
subject to satisfaction of vesting conditions, a participant may exercise an Option, performance Right or
other Award by lodging an exercise notice with catapult and complying with any requirements under the
employee plan.
A participant will have a vested and indefeasible entitlement to any dividends declared and distributed by
catapult on any shares which, at the books closing date for determining entitlement to those dividends, are
standing to the account of the participant. A participant may exercise any voting rights attaching to shares
registered in the participant’s name.
catapult may, in its discretion, issue new shares or cause existing shares to be acquired or transferred to the
participant, or a combination of both alternatives, to satisfy catapult’s obligations under the employee plan.
if catapult determines to cause the transfer of shares to a participant, the shares may be acquired in such
manner as catapult considers appropriate, including from a trustee appointed under the employee plan.
pursuant to the employee plan, catapult has appointed the employee plan trustee to acquire and hold shares
on behalf of participants and for the purposes of the employee plan. catapult may give directions to the
employee plan trustee as contemplated in the trust deed or if in connection with any Award. the employee
plan trustee holds 3,738,898 shares on behalf of participants and for the purposes of the employee plan.
the employee plan trustee has entered into a restriction agreement with catapult, pursuant to which those
shares are subject to escrow for a period of 24 months commencing on the date of Official Quotation.
78
notes to the Consolidated Financial Statements
20. EmPLOYEE REmunERAtIOn (continued)
20.2 Share-base employee remuneration (continued)
Vesting period for Performance Rights (continued)
Options, performance Rights and other Awards which have not been exercised will be forfeited if the
applicable vesting conditions and any other conditions to exercise are not met during the prescribed vesting
period or if they are not exercised before the applicable expiry date. in addition, Options, performance
Rights and other Awards will lapse if the participant deals with the Options, performance Rights or other
Awards in breach of the rules of the employee plan or in the opinion of the directors, a participant has acted
fraudulently or with gross misconduct.
Options, performance Rights and other Awards will not be quoted on AsX. catapult will apply for official
quotation of any shares allotted under the employee plan, unless the board resolves otherwise.
the board may in its absolute discretion determine that a participant is required to pay an exercise price
to exercise the Options, performance Rights or other Awards offered or granted to that participant.
grants of Options, performance Rights or other Awards under the employee plan to a director may
be subject to the approval of shareholders, to the extent required under the AsX listing Rules.
participants in the employee plan must not enter into transactions or arrangements, including by way
of derivatives or similar financial products, which limit the economic risk of holding unvested Awards.
subject to the rules of the employee plan, the board must not offer Options, performance Rights or other
Awards if the total of the following exceeds 5% of the number of shares on issue at the time of the offer:
> the number of shares which are the subject of the offer of Awards;
> the number of shares which are the subject of any outstanding offers of Awards;
> the number of shares issued during the previous 5 years under the employee plan, but not including
existing shares transferred to a participant after having been acquired for that purpose; and
> the number of shares which would be issued under all outstanding Awards that have been granted
but which have not yet been exercised, terminated or expired, assuming all such Awards were exercised
ignoring any vesting conditions, but disregarding any offer made, or Award offered or issued or share
issued by way or as a result of:
– an offer that does not meet disclosure to investors because of section 708 or section 1012d of the
corporations Act;
– an offer made pursuant to a disclosure document or product disclosure statement; or
– other offers that are excluded from the disclosure requirements under the corporations Act.
the board may impose restrictions on dealing in shares or Awards which are acquired under the employee
plan, for example, by prohibiting them from being sold, transferred, mortgaged, pledged, charged or
otherwise disposed of or encumbered for a period of time.
if the board determines that for a taxation, legal, regulatory or compliance reasons it is not appropriate
to issue or transfer shares, catapult may in lieu of and in final satisfaction of catapult’s obligation to issue
or transfer shares as required upon the exercise of an Award by a participant, make a cash payment to the
participant equivalent to the fair market value of the Awards.
where there is a change of control of catapult, including where any person acquires a relevant interest in
more than 50% of the shares, or where the board concludes that there has been a change in the control of
catapult, the board will determine, in its sole and absolute discretion, the manner in which all unvested and
vested Awards will be dealt with.
Catapult Group International Limited Annual Report 2017
79
where there is a takeover bid made for all of the shares or a scheme of arrangement, selective capital
reduction or other transaction is initiated which has a similar effect to a full takeover bid for shares, then
participants are entitled to accept into the takeover offer or participate in the other transaction in respect
of all or part of their Awards notwithstanding any restriction period has not expired. further, the board may
in its discretion waive unsatisfied vesting conditions in relation to some or all Awards in the event of such a
takeover or other transaction.
if, prior to the exercise of an Award, catapult makes a pro-rata bonus issue to shareholders, and the Award is
not exercised prior to the record date in respect of the bonus issue, the Award will, when exercised, entitle the
participant to one share plus the number of bonus shares which would have been issued to the participant if
the Award had been exercised prior to the record date.
if catapult undergoes a capital reorganisation, then the terms of the Awards for the participant will be
changed to the extent necessary to comply with the AsX listing Rules.
the employee plan also contains terms having regard to Australian law for dealing with the administration,
variation and termination of the employee plan.
share options and weighted average exercise prices are as follows for the reporting periods presented:
Options Program
Performance Rights
Weighted
average
excise price
($)
Weighted
average
excise price
($)
Number of
Shares
Number of
Shares
Outstanding at 1 July 2016
4,033,488
1.0030
440,000
0.0000
granted
forfeited
exercised
expired
6,600,000
3.2541
405,000
0.0000
(674,819)
0.7409
(60,000)
0.0000
(112,102)
0.8385
(25,000)
0.0000
–
–
–
–
Outstanding at 30 June 2017
9,846,567
2.4261
760,000
0.0000
Exercisable at 30 June 2017
1,693,000
1.3123
5,000
0.0000
the following principal assumptions were used in the valuation:
All options granted during the year are exercisable from their vesting date.
80
notes to the Consolidated Financial Statements
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Catapult Group International Limited Annual Report 2017
81
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82
notes to the Consolidated Financial Statements
20. EmPLOYEE REmunERAtIOn (continued)
20.3 Employee benefits
the liabilities recognised for employee benefits consist of the following amounts:
Current
wages and salaries
social security costs & payroll taxes
defined contribution plans
Accrued leave entitlements
Total current employee benefits
Non-current
Accrued leave entitlements
Total non-current employee benefits
2017
$’000
2016
$’000’s
4,104
2,204
148
469
1,363
6,084
–
183
888
3,275
62
62
67
67
the current portion of these liabilities represents the group’s obligations to its current and former employees
that are expected to be settled during the next 12 months and its accrued annual leave liabilities and current
accrued long service leave. in 2016, social security and payroll taxes balance has been reclassified to other
receivables, note 11, as a refund is due.
Catapult Group International Limited Annual Report 2017
83
21. ShARE CAPItAL
the share capital of catapult group international ltd consists only of fully paid ordinary shares; the shares
do not have a par value. All shares are equally eligible to receive dividends and the repayment of capital and
represent one vote at the shareholders’ meeting of catapult group international ltd.
Note
30 June 17
Shares
30 June 16
Shares
30 June 17
$’000
30 June 16
$’000
Shares issued and fully paid for:
124,425,588 120,549,588
beginning of the year
fX movement on XOs
shares issued for cash
shares issued for acquisition
of kodaplay
share issue costs
deferred tax credit recognised directly
on share issue costs
Other
Total contributed equity at end
of reporting year
Other equity securities
124,425,588 120,165,982
–
–
23,587
23,587
–
23,586
17,746
–
43,073,500
4,259,606
116,674
6,049
424,579
–
–
–
–
–
–
–
1,673
–
(4,700)
1,465
25
(288)
80
–
167,923,667 124,425,588
138,724
23,586
treasury shares
21. (a)
(3,738,898)
(3,876,000)
Total contributed equity
164,184,769 120,549,588
138,724
23,586
On 22 July 2016, the group undertook a capital raising of 33,334,450 shares at $3.00 per share.
the amount raised was $100,003,350.
On 5 may 2017, the group undertook a capital raising of 7,000,000 shares at $2.00 per share.
the amount raised was $14,000,000.
On 6 June 2017, the group issued 324,650 shares to the market at $2.00 per share.
the amount raised was $649,300.
On 6 June 2017, the group issued 1,664,400 shares on exercise of the disruptive Option were issued at an
exercise price of $0.2565 per share.
the amount raised was $426,885.
On 6 June 2017, the group issued 750,000 shares to the market at $2.00 per share.
the amount raised was $1,500,000.
84
notes to the Consolidated Financial Statements
21. ShARE CAPItAL (continued)
21. (a) Treasury Shares
treasury shares are shares in catapult group international limited that are held by the catapult sports
employee share plan trust for the purpose of issuing shares under the catapult sports employee share plan
in respect of options and performance rights issued under that plan:
Opening balance at 1 July 2016
transactions during the year
Closing balance at 30 June 2017
2017
Shares
2016
Shares
3,876,000
3,876,000
(137,102)
–
3,738,898
3,876,000
during the year a number of shares were issued under the employee share purchase option plan vested. the
amount of shares issued under this option plan was 112,102 at an average exercise price of $0.8385 per share.
the amount raised was $93,999.
during the year a number of shares were issued under the employee share purchase performance rights
plan vested. the amount of shares issued under this option plan was 25,000 at an average exercise price of
$0.00 per share. the amount raised was $nil.
21. (b) Options and performance rights on issue
the following sets out the weighted average exercise price calculations for all outstanding options (however,
excluding the effect of the performance rights as detailed at note 20.2):
Outstanding at beginning of year
Outstanding at end of year
currently excerciseable
Weighted
average
exercise
price
$0.7996
$2.4261
$1.3123
Catapult Group International Limited Annual Report 2017
85
22. LEASES
22.1 Finance leases as lessee
the group has no finance leases as a lessee.
22.2 Operating leases as lessee
the group leases an office and production building under an operating lease. the future minimum lease
payments are as follows:
30 June 17
30 June 16
Minimum Lease Payments Due
Within
1 year
$’000
1,495
246
2-5 years
$’000
3,773
190
After
5 years
$’000
952
–
Total
$’000
6,220
436
lease expense during the period amounted to $1,323,299 (2016: $186,005) representing the minimum
lease payments.
22.3 Operating leases as lessor
the group leases out wearable athlete tracking units and laptops on a subscription basis to its clients.
the future minimum revenues are as follows
30 June 17
30 June 16
Minimum Lease Payments Due
Within
1 year
$’000
16,774
10,449
2-5 years
$’000
20,363
20,926
After
5 years
$’000
–
–
Total
$’000
37,137
31,375
lease revenues during the period amounted to $16,341,988 (2016: $9,175,198) representing the minimum
subscription payments for these lease units.
subscription agreements are in place with over 400 clients (2016: 250 clients) with a broad range of expiry
dates, based on the commencement of this kind of arrangement in 2012 and contracts typically of 36 months
with standard wording incorporating rolling renewals of these agreements upon expiry of the initial term. the
athlete tracking units and their associated equipment are included as the group’s plant and equipment and
depreciated over their useful life of 4 years (see note 13).
86
notes to the Consolidated Financial Statements
23. FInAnCE COStS AnD FInAnCE InCOmE
finance costs for the reporting periods consist of the following:
interest expenses for borrowings at amortised cost:
interest expense
finance income for the reporting periods consists of the following:
interest income from cash and cash equivalents
24. OthER FInAnCIAL ItEmS
Other financial items consist of the following:
loss on exchange differences on loans and receivables
2017
$’000
2016
$’000
21
21
26
26
2017
$’000
2016
$’000
67
67
71
71
2017
$’000
(385)
(385)
2016
$’000
(78)
(78)
Catapult Group International Limited Annual Report 2017
87
25.
InCOmE tAx ExPEnSE
the major components of tax expense and the reconciliation of the expected tax expense based on the
domestic effective tax rate of catapult group international ltd at 30% (2016: 30%) are:
Loss before tax
2017
$’000
2016
$’000
(14,046)
(8,622)
Expected tax expense at domestic tax rate for parent at 30%
(4,214)
(2,587)
Adjustment for tax-rate differences in foreign jurisdictions
tax losses in foreign jurisdictions not recognised
tax losses from business combination being utilised
prior year tax losses utilised in current period
Adjustment for tax-effect of non-assessable income:
698
1,332
–
(1,427)
(561)
–
–
–
R&d tax offset recognised as grant income
–
(302)
Adjustment for tax-effect of non-deductible expenses:
Adjustment for prior periods
net R&d tax offset
Other non-deductible expenses
Actual tax benefit
tax benefit comprises:
Adjustment for prior periods
current tax
deferred tax
Tax benefit
(24)
(630)
3,800
(387)
474
612
(465)
(2,751)
(24)
(1,704)
(387)
85
1,263
(2,449)
(465)
(2,751)
deferred tax benefit recognised directly in equity relating to share issue costs
(1,385)
(80)
note 16 provides information on deferred tax assets and liabilities.
88
notes to the Consolidated Financial Statements
26. AuDItOR REmunERAtIOn
Assurance services
Auditors of the company – grant thornton Australia
Audit and review of the financial statements
Other assurance services
Overseas grant thornton network firms:
Other services
Auditors of the company – grant thornton Australia
2017
$’000
2016
$’000
195,222
22,699
55,529
95,636
12,000
14,347
273,450
121,983
taxation compliance and general accounting advice
117,091
43,700
Other review services
Overseas grant thornton network firms:
taxation compliance and general accounting advice
Other review services
Total other service remuneration
Total auditor’s remuneration
29,070
–
7,466
3,284
–
–
48,133
–
156,911
91,833
430,361
213,816
Catapult Group International Limited Annual Report 2017
89
27. EARnInGS PER ShARE
both the basic and diluted earnings per share have been calculated using the loss attributable to shareholders
of the parent company (catapult group international ltd) as the numerator (i.e no adjustments to profit
were necessary in 2015 or 2016). 10,606,567 options and performance rights have not been included in
calculating diluted eps because their effect is anti-dilutive.
the reconciliation of the weighted average number of shares for the purpose of diluted earnings per share
to the weighted average number of ordinary shares used in the calculation of basic earnings per share are
as follows:
weighted average number of shares used in basic and diluted earnings
per share
2017
shares
2016
shares
157,379
118,746
28. DIvIDEnDS
nil paid in the period
28.1 Dividends paid and proposed
nil
28.2 Franking credits
the amount of the franking credits available for subsequent reporting
periods are:
balance of franking account at the beginning of the year
deferred debit that will arise from the receipt of the R&d tax offset
for the current year
Balance of franking account adjusted for deferred debits arising from past
R&D tax offsets received and expected R&D tax offset to be received for
the current year
2017
$’000
2016
$’000
(3,841)
(1,982)
–
(1,859)
(3,841)
(3,841)
90
notes to the Consolidated Financial Statements
29. RECOnCILIAtIOn OF CASh FLOWS FROm OPERAtInG ACtIvItIES
Reconciliation of Cash Flows from Operating Activities
Cash flows from operating activities
loss for the period
Adjustments for:
2017
$’000
2016
$’000
(13,581)
(5,871)
depreciation, amortisation and impairment
9,994
1,800
foreign exchange differences
net interest and dividends received included in investing and financing
share based payments expense
Net changes in working capital:
change in inventories
change in trade and other receivables
change in other assets
change in current tax assets
change in trade and other payables
change in other employee obligations
117
(67)
3,256
(234)
(45)
290
(281)
(4,060)
(987)
475
(7,116)
(3,859)
465
(1,991)
2,138
2,620
129
(868)
4,181
1,181
change in deferred tax, excluding amounts recognised directly in equity
(209)
(2,448)
change in income tax payable
change in other current liabilities
Net cash from operating activities
83
(3,566)
(8,563)
66
2,911
1,768
(8,844)
(2,292)
Catapult Group International Limited Annual Report 2017
91
30. RELAtED PARtY tRAnSACtIOnS
the group’s related parties include its associates and joint venture, key management, post-employment
benefit plans for the group’s employees and others as described below.
unless otherwise stated, none of the transactions incorporate special terms and conditions and no
guarantees were given or received. Outstanding balances are usually settled in cash.
transactions with key management
2017
$’000
2016
$’000
70
70
44
44
Adir shiffman was a director of innovate Online pty ltd until 23 July 2015. the group engaged innovate
Online pty ltd website services during the financial year $5,500 (2016: $nil) and an amount payable as at
30 June 2017 of $nil (2016: $nil).
calvin ng is a director of Aura group pty ltd. during the year, the group engaged Aura capital pty ltd
(a subsidiary of Aura group services ltd) for advisory services amounting to $1,127 (2016: $nil) and had
an amount payable as at 30 June 2017 of $nil (2016: $nil). catapult rents office space from Aura group
services ltd in sydney and singapore for a total cost of $39,806 (2016: $44,444) and had an amount payable
as at 30 June 2017 of $21,369 (2016: $40,182).
Joe powell invoiced the group during the year for consultancy and advisory services amounting to $22,952
(2016: $nil) and had an amount payable as at 30 June 2017 of $nil (2016: $nil).
30.1 Transactions with key management personnel
key management of the group are the executive members of catapult group international’s board of
directors and executive team.
short term employee benefits
salaries including bonuses and leave accruals
social security costs
Total short term employee benefits
long service leave
Total other long-term benefits
share-based payments
Total remuneration
2017
$’000
2016
$’000
3,326
107
3,433
8
8
1,206
4,647
2,151
98
2,249
22
22
115
2,386
92
notes to the Consolidated Financial Statements
31. FInAnCIAL InStRumEnt RISK
31.1 Risk management objectives an polices
the group is exposed to various risks in relation to financial instruments. the group’s financial assets and
liabilities by category are summarised in note 19.1. the main types of risks are market risk, credit risk and
liquidity risk.
the group’s risk management is coordinated in close cooperation with the board of directors, and focuses
on actively securing the group’s short to medium-term cash flows by minimising the exposure to financial
markets the group does not actively engage in the trading of financial assets for speculative purposes nor
does it write options. the most significant financial risks to which the group is exposed are described below.
31.2 Market risk analysis
the group is exposed to currency risk resulting from its operating activities.
Foreign Currency Sensitivity
exposures to currency exchange rates arise from the group’s overseas sales and purchases, which are
primarily denominated in us dollars (usd), pound sterling (gbp), euro (euR) and Japanese yen (Jpy).
foreign currency denominated financial assets and liabilities which expose the group to currency risk are
disclosed below. the amounts shown are those translated into $Aud at the closing rate:
30 June 2017
financial assets
financial liabilities
Total Exposure
30 June 2017
financial assets
financial liabilities
Total Exposure
USD
$’000
GBP
$’000
EUR
$’000
JPY
$’000
AED
$’000
Short Term Exposure
24,768
(6,220)
18,548
2,320
(789)
1,531
2,053
(220)
1,833
3
1
4
–
(7)
(7)
USD
$’000
GBP
$’000
EUR
$’000
JPY
$’000
AED
$’000
Long Term Exposure
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Catapult Group International Limited Annual Report 2017
93
30 June 2016
financial assets
financial liabilities
Total Exposure
30 June 2016
financial assets
financial liabilities
Total Exposure
USD
$’000
GBP
$’000
EUR
$’000
JPY
$’000
AED
$’000
Short Term Exposure
5,823
(1,157)
4,666
964
(599)
365
783
(162)
621
–
(17)
(17)
–
–
–
USD
$’000
GBP
$’000
EUR
$’000
JPY
$’000
AED
$’000
Long Term Exposure
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
the following table illustrates the sensitivity of profit and equity in regards to the group’s financial assets
and financial liabilities and the various exchange rates ‘all other things are equal’. it assumes a +/– 10%
change of the various exchange rate for the year ended at 30 June 2017 (2016:10%).
if the Aud had strengthened by 10% against the respective currencies then this would have had the
following impact:
30 June 2017
30 June 2016
USD
$’000
(1,686)
(424)
GBP
$’000
(139)
(33)
EUR
$’000
(167)
(56)
JPY
$’000
–
(2)
Total
$’000
(1,992)
(515)
if the Aud had weakened by 10% against the respective currencies then this would have had the following
impact:
30 June 2017
30 June 2016
USD
$’000
2,061
467
GBP
$’000
EUR
$’000
JPY
$’000
170
36
204
62
–
(2)
Total
$’000
2,435
563
exposures to foreign exchange rates vary during the year depending on the volume of overseas transactions.
nonetheless, the analysis above is considered to be representative of the group’s exposure to currency risk.
94
notes to the Consolidated Financial Statements
31.
FInAnCIAL InStRumEnt RISK (continued)
31.3 Credit risk analysis
credit risk is the risk that a counterparty fails to discharge an obligation to the group. the group is exposed
to this risk for receivables to customers. the group’s maximum exposure to credit risk is limited to the
carrying amount of the financial assets recognised at the reporting date, as summarised below:
classes of financial assets
> cash and cash equivalents
> trade receivables
> other long term financial assets
2017
$’000
2016
$’000
16,686
25,011
208
3,643
6,957
46
41,905
10,646
the group continuously monitors defaults of customers and other counterparties, identified either individually
or by group, and incorporates this information into its credit risk controls. where available at reasonable cost,
external credit ratings and/or reports on customers and other counterparties are obtained and used. the
group’s policy is to deal only with creditworthy counterparties.
the group’s management considers that all of the above financial assets that are not impaired or past due
for each of the 30 June reporting dates under review are of good credit quality.
At 30 June the group has certain trade receivables that have not been settled by the contractual due date
but are not considered to be impaired. the amounts at 30 June, analysed by the length of time past due, are:
not more three (3) months
> more than three (3) months but not more than six (6) months
> more than six (6) months but not more than one (1) year
> more than one (1) year
Total
2017
$’000
22,500
220
326
82
2016
$’000
767
329
473
82
23,128
1,651
in respect of trade receivables, the group is not exposed to any significant credit risk exposure to any single
counterparty or any group of counterparties having similar characteristics. trade receivables consist of a
large number of customers in various sports and geographical areas. based on historical information about
customer default rates management consider the credit quality of trade receivables that are not past due
or impaired to be good.
the credit risk for cash and cash equivalents is considered negligible, since the counterparties are reputable
banks with high quality external credit ratings.
Catapult Group International Limited Annual Report 2017
95
31.4 Liquidity risk analysis
liquidity risk is the risk that the group might be unable to meet its obligations. the group manages its
liquidity needs by monitoring scheduled debt servicing payments for long-term financial liabilities as well as
forecast cash inflows and outflows due in day-to-day business. liquidity needs are monitored on a week-to-
week basis, as well as on the basis of a rolling 90-day projection.
As at 30 June 2017, the group’s non-derivative financial liabilities have contractual maturities (including
interest payments where applicable) as summarised below:
30 June 17
us-dollar loans
trade and other payables
Total
Within
6 months
$’000
Current
6 – 12
months
$’000
Non-current
1 – 5 years
$’000
5+ years
$’000
–
3,342
8,542
8,542
–
3,342
–
–
–
–
–
–
this compares to the maturity of the group’s non-derivative financial liabilities in the previous reporting
periods as follows:
30 June 16
us-dollar loans
trade and other payables
Total
Within
6 months
$’000
Current
6 – 12
months
$’000
Non-current
1 – 5 years
$’000
5+ years
$’000
–
5,710
5,710
–
–
–
–
–
–
–
–
–
the above amounts reflect the contractual undiscounted cash flows, which may differ to the carrying values
of the liabilities at the reporting date.
32. CAPItAL mAnAGEmEnt POLICIES AnD PROCEDuRES
the group’s objectives when managing capital are to safeguard its ability to continue as a going concern,
to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital
structure to reduce the cost of capital. consistent with others in the industry, the group monitors capital
on the basis of its gearing ratio. in order to maintain or adjust its capital structure, the group considers its
issue of new capital, return of capital to shareholders and dividend policy as well as its plan for acquisition
or disposal of assets.
33. COntInGEnt LIABILItIES
there were no contingent liabilities as at 30 June 2017.
96
notes to the Consolidated Financial Statements
34. ACquISItIOn OF KODAPLAY LImItED (PLAYERtEK)
On 11 August 2016, the group acquired 100% of the equity instruments of kodaplay ltd (‘playertek’), an
ireland based business, thereby obtaining control. the acquisition was made to expedite the group’s position
in the emerging prosumer space for wearable athlete monitoring globally. playertek is an emerging business
in the group’s targeted expansion market of prosumer.
the details of the business combination are as follows:
fair value of consideration transferred:
Amount settled in cash
Amount settled in shares
Recognised amounts of Identifiable net assets
property, plant and equipment
identifiable intangible Assets
Total non-current assets
cash and cash equivalents
trade and other receivables
inventories
Other current assets
Total current assets
trade and other payables
taxes payable
Other liabilities (current)
Liabilities
Identifiable Net Assets
Goodwill recognised on acquisition
consideration transferred settled in cash
cash acquired
Net cash outflow on acquisition
$’000
3,642
1,673
5,315
$’000
14
1,015
1,029
91
284
80
150
605
(77)
(1,434)
(16)
(95)
1,539
3,776
3,642
(91)
3,551
Acquisition related costs amounting to $70,002 are not included as part of consideration transferred and
have been recognised as an expense in the consolidated statement of profit or loss and other comprehensive
income, as part of ‘other expenses’.
Catapult Group International Limited Annual Report 2017
97
35. ACquISItIOn OF xOS tEChnOLOGIES InC
On 12 August 2016, the group acquired 100% of the equity instruments of XOs digital inc (‘XOs’), a
wilmington, mA (usA) based business, thereby obtaining control. the acquisition of XOs was made to
compliment the group’s business operations increasing the offering to the elite sports market, initially
focused on the us market.
fair value of consideration in cash
Recognised amounts of identifiable net assets
property, plant and equipment
identifiable intangible Assets
deferred tax asset
Other non-current assets
Total non-current assets
cash and cash equivalents
trade and other receivables
inventories
Other current assets
Total current assets
trade and other payables
Royalties accrued
deferred revenue
taxes payable
Other liabilities (current)
deferred tax liability
Liabilities
Identifiable Net Assets
Goodwill recognised on acquisition
consideration transferred settled in cash
cash acquired
Net cash outflow on acquisition
$’000
81,909
$'000
499
37,811
3,677
184
42,171
3,259
10,393
597
576
14,825
(2,168)
(1,086)
(16,203)
64
(1,782)
(1,959)
(23,134)
33,862
48,047
81,909
(3,259)
78,650
Acquisition related costs amounting to $789,911 are not included as part of consideration transferred and
have been recognised as an expense in the consolidated statement of profit or loss and other comprehensive
income, as part of ‘other expenses’.
98
notes to the Consolidated Financial Statements
35. ACquISItIOn OF xOS tEChnOLOGIES InC (continued)
At the date of acquisition XOs digital inc. had us$15.4 million of carry-forward tax losses. $3.7m of these
losses have been recognised as a deferred tax asset as at 30 June 2017. goodwill recognised on acquisition
is not tax deductible.
trade and other receivables are recorded at the expected fair value of contractual cash flows and best
estimate of amounts expected to be collected.
contribution to revenue and operating profit during the period are shown in video Analytics segment
reporting refer to note 7.
had the business combination occurred at the start of the year, group revenue and net loss would be stated
as $64,464,332 and $10,411,618 respectively.
36. PAREnt EntItY InFORmAtIOn
information relating to catapult group international ltd (‘the parent entity’):
Statement of financial position
current assets
total assets
current liabilities
total liabilities
net assets
issued capital
foreign currency reserve
Retained earnings
share option reserve
Total equity
Statement of profit and loss and other comprehensive income
loss for the year
Other comprehensive income/(loss)
Total comprehensive income/(loss)
2017
$’000
2016
$’000
8,317
133,436
176
936
132,500
138,740
(2,045)
(8,927)
4,033
1,226
24,293
876
1,159
23,134
23,626
–
(1,269)
777
131,802
23,134
(7,659)
(2,045)
(9,704)
(359)
–
(359)
the parent entity has no capital commitments at year end (2016: $nil).
Parent entity guarantees in respect of debts of its subsidiaries
the parent entity has entered into the following guarantee on the 26 June 2017:
A deed of cross guarantee with the effect that the company guarantees debts in respect of one of its
subsidiaries. further details to the deed cross guarantee and the subsidiaries subject to the deed, are
disclosed in note 37.
Catapult Group International Limited Annual Report 2017
99
37. DEED OF CROSS GuARAntEE
A consolidation income statement and consolidation balance sheet comprising the company and controlled
entity which are a party to the deed of gross guarantee (members of the ‘closed group’), after eliminating
all transactions between parties to the deed of gross guarantee are as follows.
Summarised income statement and statement of comprehensive
income and accumulated losses
profit/(loss) before income tax expense
income tax benefit/(expense)
profit after income tax
Accumulated losses at the beginning of the financial year
dividends paid
Accumulated losses at the end of the financial year
Statement of Financial position
Current assets
cash and cash equivalents
trade and other receivables
inventories
Other current assets
Total current assets
Non current assets
property, plant and equipment
intangible assets
deferred tax assets
Other non current assets
Total non current assets
Total assets
Closed Group
2017
$’000
2016
$’000
(13,860)
(4,330)
699
1,325
(13,161)
(3,005)
(5,305)
(2,300)
–
–
(18,466)
(5,305)
9,818
1,844
11,391
11,673
1,937
3,261
1,882
5,486
26,407
20,885
5,136
4,911
3,548
93,338
106,933
133,340
3,358
3,024
3,347
2,207
11,936
32,821
100
notes to the Consolidated Financial Statements
37. DEED OF CROSS GuARAntEE
Statement of Financial position (continued)
Current liabilities
trade and other payables
employee benefits
Other current liabilities
Total current liabilities
Non current liabilities
employee benefits
Other non current liabilities
Total non current liabilities
Total Liabilities
Net assets
Shareholders’ equity
issued capital
share option reserve
foreign currency reserve
Accumulated losses
Total Shareholders’ equity
Closed Group
2017
$’000
2016
$’000
6,427
1,982
1,698
6,227
1,182
5,874
10,107
13,283
51
760
811
10,918
122,422
67
373
440
13,723
19,098
138,740
23,626
4,033
(1,885)
777
–
(18,466)
(5,305)
122,422
19,098
the members of the closed group comprise catapult group international limited and catapult sports
pty ltd.
38. POSt-REPORtInG DAtE EvEntS
Acquisition of athlete management system:
On 4 August 2017, catapult acquired the sportsmed elite and baseline Athlete management system (Ams)
products and clients and recruited key personnel, from smg technologies pty ltd (smg) for consideration
ranging between $1.4m and $3.9m depending on performance metrics and incremental revenue generated
in the two years following the acquisition.
the acquisition involved the transfer of six employees, customer contracts and intangible assets for
developed software to catapult. the modularised cloud-based platform acts as a store of team data
and information, including player wellness metrics, injury and medical records, wearable data and video.
Catapult Group International Limited Annual Report 2017
101
Directors’ Declaration
1.
in the opinion of the directors of catapult group international ltd:
(a) the consolidated financial statements and notes of catapult group international ltd are in accordance
with the Corporations Act 2001, including:
(i) giving a true and fair view of its financial position as at 30 June 2017 and of its performance for the
year ended on that date; and
(ii) complying with Australian Accounting standards (including Australian Accounting interpretations)
and the Corporations Regulations 2001; and
(b) there are reasonable grounds to believe that catapult group international ltd will be able to pay its
debts as and when they become due and payable.
2. the directors have been given the declarations required by section 295A of the Corporations Act 2001
from the chief executive Officer and chief financial Officer for the financial year ended 30 June 2017.
3. note 2 confirms that the consolidated financial statements also comply with international financial
Reporting standards.
4. At the date of the declaration, there are reasonable grounds to believe that the members of the extended
closed group identified in note 36 will be able to meet any obligations or liabilities to which that are, or may
become, subject by virtue of the deed of cross guarantee described in note 37.
signed in accordance with a resolution of the directors:
Adir Shiffman
director
dated the 31st day of August 2017
102
Independent Auditor’s Report
The Rialto, Level 30
525 Collins St
Melbourne Victoria 3000
Correspondence to:
GPO Box 4736
Melbourne Victoria 3001
T +61 3 8320 2222
F +61 3 8320 2200
E info.vic@au.gt.com
W www.grantthornton.com.au
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF CATAPULT GROUP INTERNATIONAL
LIMITED
Report on the audit of the financial report
Opinion
We have audited the financial report of Catapult Group International Limited (the “Company”) and
its subsidiaries (the “Group”), which comprises the consolidated statement of financial position as
at 30 June 2017, the consolidated statement of profit or loss, the consolidated statement of other
comprehensive income, consolidated statement of changes in equity and consolidated statement
of cash flows for the year then ended, and notes to the consolidated financial statements, including
a summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the
Corporations Act 2001, including:
a Giving a true and fair view of the Group’s financial position as at 30 June 2017 and of its
performance for the year ended on that date; and
b Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report. We are independent of the Group in accordance with the
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have
also fulfilled our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients and/or refers to one or more member firms, as the
context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm
is a separate legal entity. Services are delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one another and
are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to Grant Thornton Australia Limited ABN 41 127 556 389 and its
Australian subsidiaries and related entities. GTIL is not an Australian related entity to Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
Catapult Group International Limited Annual Report 2017
103
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance
in our audit of the financial report of the current period. These matters were addressed in the
context of our audit of the financial report as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Key audit matter
Revenue recognition
Note 8
How our audit addressed the key audit matter
Revenue recognition was considered a key audit matter,
as Software as a Service (“SaaS”) arrangements
Our procedures included, amongst others:
documenting our understanding of the various SaaS
inherently contain multiple elements for which the
arrangements used by the Group and evaluating
determination of revenue recognition can be complex
management’s revenue recognition of the elements
and involve management judgement.
they contained to assess compliance with AASB 118:
These judgements include:
identification of each element in the arrangements;
determining the appropriate allocation of the amount
Revenue;
testing a sample of sales transactions recorded in the
general ledger and agreeing these to the contracts
with customers to assess whether; revenue is being
of revenue to each element in particular as many of
recognised in accordance with the Group’s revenue
the Group’s arrangements involve the delivery of
recognition policies, agreeing receipt of the revenue
goods, software licences and other services; and
to the bank and the delivery of the hardware
determining when each element of revenue should
components to proof-of-delivery;
be recognised.
assessing sales selected in our sample above, where
applicable, for the accuracy of revenue to be
deferred at year end;
testing a sample of deferred revenue balances at
reporting period end against agreements to ensure
the amounts were appropriately deferred;
substantiating sales transactions around reporting
date and agreeing transactions to supporting
documents to assess whether revenue is recognised
in the correct periods; and
assessing the adequacy of financial statement
disclosures.
104
Independent Auditor’s Report
Key audit matter
How our audit addressed the key audit matter
Impairment of goodwill and other intangible assets
Note 14 & Note 15
At 30 June 2017, the Group’s balance sheet included
goodwill of $53.127 million and other intangible assets
Our procedures included, amongst others:
assessing management’s identification of each of the
amounting to $41.181 million, contained within multiple
Group’s CGUs based on our understanding of the
cash generating units (CGUs).
nature of the Group’s business and cash flows;
engaging our valuation specialists to compare the
The assessment of impairment of the Group’s goodwill
key assumptions with external benchmarks (for
and other intangible assets requires significant
example discount rates) and to consider the
judgement in determining the value-in-use. These
assumptions based on our knowledge of the Group
judgements include:
the existence of impairment indicators;
determination of appropriate CGUs;
forecast future cash flows; and
assumptions such as discount and growth rates.
and its industry;
assessing the accuracy of management forecasts
against relevant historical information to evaluation to
inform our evaluation of the value-in-use model;
testing the mathematical accuracy of the cash flow
models and agreeing relevant data to the latest
This area was determined to be a key audit matter due to
forecasts;
the use of a value-in-use model for determining
challenging the Group’s assumptions and estimates
recoverable amount in management’s impairment
used to determine the recoverable value of its CGUs,
assessments.
including those relating to forecast revenue, forecast
costs, and discount rates and where available,
corroborating the key market related assumptions to
external data; and
assessing the adequacy of financial statement
disclosures.
Catapult Group International Limited Annual Report 2017
105
Key audit matter
Business combinations
Note 34 & Note 35
How our audit addressed the key audit matter
During the year ended 30 June 2017 the Group acquired
XOS Technologies Inc. for purchase consideration of
Our procedures included, amongst others:
reading the sale and purchase agreements to
$81.9 million and Kodaplay Limited for purchase
understand key terms and conditions;
consideration of $5.3 million.
assessing the qualifications and experience of the
Independent Expert engaged by management and
Accounting for these transactions is a complex and
their suitability to perform the valuation engagement;
judgemental exercise, requiring management to
working with our valuation specialists to assess the
determine the fair value of acquired assets and liabilities,
work contained in the Independent Expert’s
in particular determining the allocation of purchase
Purchase Price Allocation Reports to determine
consideration to goodwill and separately identifiable
whether the appropriate intangible assets had been
intangible assets.
identified, whether the appropriate valuation
methodologies had been used and to determine
It is due to the size of the acquisition and the estimation
whether assumptions used were reasonable
process involved in accounting for these business
compared with external benchmarks (for example
combinations that this is a key audit matter.
discount rates) and to consider the assumptions
based on our knowledge of the Group and its
The Group engaged an Independent Expert to value the
industry;
intangible assets acquired in these business
combinations.
testing the mathematical accuracy of the underlying
calculations;
evaluating the forecasts provided by management
upon which the valuations were based by assessing
forecast revenues, operating costs and capital
expenditure based on our knowledge of the Group
and market and sector trends; and
assessing the adequacy of the Group’s disclosures
in respect of the business acquisitions against the
requirements of AASB 3: Business Combinations.
Information Other than the Financial Report and Auditor’s Report Thereon
The Directors are responsible for the other information. The other information comprises the
information included in the Group’s annual report for the year ended 30 June 2017, but does not
include the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors’ for the Financial Report
The Directors of the Company are responsible for the preparation of the financial report that gives
a true and fair view in accordance with Australian Accounting Standards and the Corporations Act
2001 and for such internal control as the Directors determine is necessary to enable the
preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
106
Independent Auditor’s Report
In preparing the financial report, the Directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the Directors either intend to liquidate the Group or
to cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with the Australian Auditing Standards will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website at:
http://www.auasb.gov.au/auditors_responsibilities/ar1.pdf. This description forms part of our
auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 28 to 38 of the directors’ report for
the year ended 30 June 2017.
In our opinion, the Remuneration Report of Catapult Group International Limited, for the year
ended 30 June 2017, complies with section 300A of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit conducted
in accordance with Australian Auditing Standards.
GRANT THORNTON AUDIT PTY LTD
Chartered Accountants
A R J Nathanielsz
Partner - Audit & Assurance
Melbourne, 31 August 2017
Catapult Group International Limited Annual Report 2017
107
ASx Additional Information
Additional information required by the AsX limited listing Rules and not disclosed elsewhere in this report
is set out below.
ShAREhOLDInGS (AS At 30 JunE 2017)
1.
CORPORAtE GOvERnAnCE StAtEmEnt
catapult’s corporate governance statement for the financial year ended 30 June 2017 is available at the
following uRl: www.catapultsports.com/au/investors/corporate-governance/
2.
SuBStAntIAL ShAREhOLDERS
Substantial holder
disruptive capital pty ltd; Aura group pty ltd, ng capital management pty
ltd; calvin ng; daring investments pty ltd; John kolenda; milenka kolenda;
caveau capital investments pty ltd; eric king wai chan
Shares held Notice date
21,434,420 28 July 2016
manton Robin pty ltd; manton Robin pty ltd
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