Centuria Capital Group (CNI)
SYDNEY (Tuesday, 17 October 2023) – Centuria Capital Group (ASX: CNI) releases its 2023 Annual Report.
2023 ANNUAL REPORT
-ENDS-
For more information or to arrange an interview, please contact:
John McBain
Joint CEO
Centuria Capital Limited
T: 02 8923 8923
E: john.mcbain@centuria.com.au
Tim Mitchell
Group Head of Investor Relations
Centuria Capital Limited
T: 02 8923 8923
E: tim.mitchell@centuria.com.au
Alexandra Koolman
Group Communications Manager
Centuria Capital Limited
T: 02 8923 8923
E: alexandra.koolman@centuria.com.au
Authorised for release by Anna Kovarik, Company Secretary.
About Centuria Capital Group
Centuria Capital Group (CNI) is an ASX-listed specialist investment manager with $21 billion of assets under management (as
at 30 June 2023). We offer a range of investment opportunities including listed and unlisted real estate funds as well as tax-
effective investment bonds. Our drive, allied with our in-depth knowledge of these sectors and intimate understanding of our
clients, allows us to transform opportunities into rewarding investments.
www.centuria.com.au
Centuria Capital Group Consisting of:
Centuria Capital Limited ABN 22 095 454 336
Centuria Capital Fund ARSN 613 856 358
Level 41, Chifley Tower
2 Chifley Square, Sydney NSW 2000
T: 02 8923 8923
F: 02 9460 2960
E: sydney@centuria.com.au
www.centuria.com.au
Centuria Capital Group
Annual Report
2023
Acknowledgement of Country
Our group manages property throughout Australia and
New Zealand. Accordingly, Centuria pays its respects to
the traditional owners of the land in each country, to their
unique cultures and to their elders past and present.
2 | Centuria Capital Group – Annual Report 2023
UNLISTED: GUYRA GLASSHOUSE, GUYRA NSW
Centuria Capital Group – Annual Report 2023 | 3
Contents
06
About Centuria
14
16
17
18
22
27
28
30
32
34
36
38
40
41
42
44
46
52
58
63
98
Australasian real estate platform
Agriculture and real estate finance create new, alternative growth corridors
A $20.2 billion leading Australasian real estate platform1
Chairman’s report
Joint CEOs' letter
Key financial metrics
Diversified funds management platform
Fund and capital allocation across Centuria’s platform
Transaction fee income from $2.4 billion of total transaction activity
Strong active asset management capabilities coupled with major tenant partners
Platform diversification reduces concentration risk
$1.6 billion development pipeline to seed funds
Unlisted property
Institutional AUM grows 11% to $2.1 billion
Listed property: AUM of $6.4 billion
Centuria Life
Sustainability at Centuria
Board of Directors
Senior executives
Directors' report
Lead Auditor's independence declaration
100 Financial statement contents
102 Consolidated statement of comprehensive income
103 Consolidated statement of financial position
105 Consolidated statement of changes in equity
106 Consolidated statement of cash flows
108 Notes to the financial statements
164
Independent Auditor's report
170 Corporate governance statement
171
Additional stock exchange information
173 Corporate directory
4 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 5
Centuria Capital Group – Annual Report 2023 | 5
LISTED: 10 AND 12 WILLIAMSON ROAD, INGLEBURN NSW
About Centuria
Centuria Capital Group (ASX:CNI) is a leading
Australasian fund manager included in the S&P/ASX
200 Index, established 25 years ago.
We manage a range of investment products including listed and unlisted real
estate funds. While we hold co-investments in many of our funds, we operate
as an external or discrete management model.
By FY23 close, CNI grew to $21.0 billion of assets under management, of which,
96% comprises real estate funds across industrial, agriculture, real estate
finance, healthcare, decentralised office, large format retail and daily needs
retail sectors within Australia, New Zealand and an active real estate financing
business.
About Centuria
Centuria’s $13.8 billion unlisted real estate funds platform includes a series of unlisted single and
multi-asset closed-ended funds and multi-asset open-ended funds. These unlisted or direct property
funds constitute 68% of Centuria’s total real estate and differentiate Centuria from many of its peers.
Centuria is the manager of Australia’s largest listed pure-play industrial and office REITs, Centuria
Industrial REIT (ASX: CIP) and Centuria Office REIT (ASX: COF), and the New Zealand diversified listed
REIT, Asset Plus Limited (NZX: APL).
CIP and COF are included in the S&P/ASX 200 and 300 Indices, respectively. Both A-REITs are
also included in the FTSE EPRA Nareit Global Development Index, enabling them to be readily
compared with international peers. Collectively, the listed REITs comprise $6.4 billion of assets under
management (AUM).
Real estate acquisitions and property finance activities during FY23 resulted in $1.4 billion of gross
real estate activity, complemented by a $1.6 billion development pipeline.
Centuria’s operations are supported by c.400 staff across eight offices in three countries with a
significant proportion of our workforce focused on the full spectrum of management – from inhouse
facility managers and asset managers, to fund managers and corporate personnel – all dedicated
to the lifecycle of real estate funds and trusts. This results in specifically curated funds and assets,
designed to optimise securityholder returns.
Centuria Capital Group (CNI) funds management platform
$21bn GROUP AUM1
$20.2bn REAL ESTATE AUM
$6.4bn
LISTED REAL ESTATE
$13.8bn
UNLISTED REAL ESTATE
$0.8bn
INVESTMENT BONDS
$3.9bn
CENTURIA
INDUSTRIAL
REIT
ASX:CIP
$2.3bn
CENTURIA
OFFICE REIT
ASX:COF
$0.2bn
ASSET PLUS
LIMITED
NZX:APL
$8.4bn
$2.6bn
$2.8bn
SINGLE
ASSET
FUNDS
MULTI
ASSET
FUNDS
MULTI ASSET
OPEN END
FUNDS
CENTURIA LIFE
CENTURIA
INVESTMENT BONDS
GUARDIAN FRIENDLY
SOCIETY
35 CAMBRIDGE STREET, COORPAROO QLD
6 | Centuria Capital Group – Annual Report 2023
Note: AUM as at 30 June 2023. All figures above are in Australian dollars (currency exchange ratio of AU$1.000:NZ$1.10883 as at
30 June 2023). Numbers presented may not add up precisely to the totals provided due to rounding.
1. AUM includes asset exchanged to be settled, cash and other assets and the impact of revaluations during this period
Centuria Capital Group – Annual Report 2023 | 7
About Centuria
Centuria's purpose
We transform real estate opportunities
into compelling investments, which
create sustainable long-term value for
our stakeholders and the communities in
which we operate.
Transform
Compelling
Opportunities
About Centuria
Communities
Sustainable
Stakeholders
Adding value to existing
assets to maximise returns
for our investors. This
approach is executed
through our proactive in-
house asset management,
harnessing development
opportunities, and our
exceptional leasing
capabilities.
Real estate transactions
across last mile industrial
facilities, decentralised
office buildings, healthcare
centres, large format and
daily needs retail outlets,
agricultural properties and
real estate debt facilities.
Attractive commercial
propositions that translate
into intelligent investment
opportunities.
Enduring initiatives that take
into account best in class
ESG considerations.
Our investors, our tenant
customers, our colleagues
and our lending partners.
Across Australia, New
Zealand and The Philippines,
we are active and engaged
corporate citizens.
8 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 9
About Centuria
About Centuria
Centuria's values and capabilities
Our core values are the essence of our identity – the principles, beliefs and
philosophy of our brand.
Our values and capabilities support our vision and shape our culture to create
a sense of belonging. We prioritise strong and lasting relationships within our
business and with our investors, tenants and partners. Centuria mobilises to
seize opportunities, we make well-informed decisions and we are transparently
accountable.
Centuria values
We are honest, transparent
and respectful
As Centurians, we take pride in how we develop strong
and lasting relationships within our business and with
our investors, tenants and partners. We do this in how we
communicate with, support, and respect one another.
We work and thrive as an
integrated and agile team
At Centuria, we are bigger than the individual parts.
We embrace diversity and collaborate with colleagues
and partners to achieve success.
We support each other to grow
Transparent cooperation
Thorough process
Centuria capabilities
We seek opportunities to encourage personal
development and support collective growth. We reward
and celebrate success and like to promote from within.
We do what it takes
We love challenges and finding unique ways to solve
problems. We have a focus on growth and a commitment
to always act ethically and in the best interests of our
stakeholders.
Transparent cooperation means our teams are
accountable and responsible, creating autonomy without
politics. We are honest in our communication, we build
trust and we value one-another’s opinions, leading to
stronger collaboration with our stakeholders.
Transactional velocity
Transactional velocity means the speed that we do
business. We mobilise our people to seize opportunities
and make quick decisions. What takes others months to
transact, takes us only days.
Our processes result in thorough analysis. Our experienced
team knows where the risks and opportunities lie, which
leads to well-informed decision-making.
Personal interaction
At Centuria, it’s personal. As a Centurian you will be well
cared for. As a client, we look after your interests as if
they were our own. We create a sense of belonging and
build relationships through the way we treat and work
with one another.
10 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 11
About Centuria
About Centuria
VISION
A leading Australasian funds manager.
Our people are leaders in their field throughout Australia, New Zealand
and the Philippines.
We leverage our geographic diversity, our in-depth market knowledge
in favoured sectors and our access to capital to grow funds under
management, with a strong focus on earnings growth.
Integrated platform
Geography
Sectors
Fund types
Capital sources
Australia
New Zealand
Office
Industrial
Healthcare
Daily needs retail
Large format retail
Real estate finance
Agriculture
Investment bonds
Listed REITS
Listed
Unlisted single asset
closed-ended funds
Unlisted multi asset
closed-ended funds
Unlisted multi asset
open-ended funds
Unlisted institutional
Unlisted retail
Unlisted wholesale
Active management
Generating investment opportunities
Integrated in-house capability
Balance sheet
Platform support
Funds management
Asset management
Cash on hand
Underwriting
Real estate transactions
Development
Distribution
Property and
facilities management
Leasing
Capital recycling
Co-investments
Diverse capital sources
Fund establishment
Undrawn debt capacity
Cornerstones
UNLISTED: FLAVORITE GLASSHOUSE, WARRAGUL VIC
12 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 13
Australasian real estate platform
Australasian real estate platform
Real estate platform expansion to $20.2 billion
over FY23.
Sectors1
Funds
Capital
Geography
3.2
7.3
6.4
6.4
6.4
3.7
$20.2
BILLION
$20.2
BILLION
8.4
6.0
2.6
2.8
Office
Industrial
Alternatives: healthcare, real estate finance, agriculture
Daily needs and large format retail
Single asset closed-end funds
Multi asset open-end funds
Multi asset closed-end funds
REITs
2.1
$20.2
BILLION
5.3
Wholesale
Retail
Institutional
REITs
2.3
$20.2
BILLION
17.7
Australia
New Zealand
Expansion into alternatives –
healthcare, real estate credit and
agriculture. Alignment to de-
centralised office, industrial, daily
needs and large format retail.
Unlisted real estate comprises
68% of total real estate AUM.
Cash on hand, mandates and
partnerships available for
deployment e.g. MSREI industrial
and healthcare partnerships.
All figures above are in Australian dollars (currency exchange ratio of AU$1.000:NZ$1.1088 as at 30 June 2022). Numbers presented may not add up
precisely to the totals provided due to rounding. AUM includes assets exchanged to be settled, cash and other assets.
1. Other AUM across tourism, shopping centres and land syndicates in the US, NZ and WA.
14 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 15
Agriculture and real estate finance
create new, alternative growth corridors
A $20.2 billion leading Australasian real
estate platform1
$20.2bn
Real estate platform1,2
Office
Industrial
$7.3bn
AUM
$6.0bn
AUM
Daily needs retail
(DNR)
$1.7bn
AUM
Healthcare
$1.7bn
AUM
FY22 $7.4bn
FY22 $6.0bn
FY22 $1.9bn
FY22 $1.7bn
Large format retail
(LFR)
$1.5bn
AUM
FY22 $1.6bn
Real estate finance
Agriculture
$1.3bn
AUM
FY22 $0.8bn
$0.5bn
AUM
FY22 $0.4bn
Note: All figures above are in Australian dollars (currency exchange ratio of AU$1.000:NZ$1.10883 as at 30 June 2023). Numbers presented may not add up
precisely to the totals provided due to rounding.
1. AUM includes assets exchanged to be settled, cash and other assets and the impact of revaluations during the period.
2. Platform total of $20.2bn includes other AUM of $0.2bn across tourism, shopping centres and land syndicates in the US, NZ and WA.
WA
NT
SA
Qld
NSW
ACT
Vic
Tas
South Australia
$925m
across 27 properties
Australian Capital Territory
$390m
across 5 properties
Tasmania
$30m
across 4 properties
Australia
New South Wales
$4,779m
across 116 properties
Western Australia
$4,444m
across 95 properties
Victoria
$3,549m
across 79 properties
Queensland
$3,385m
across 94 properties
North
Island
South
Island
New Zealand
Auckland
$1,556m
across 36 properties
Other New Zealand
$745m
across 57 properties
Note: All figures above are in Australian
dollars (currency exchange ratio of
AU$1.000:NZ$1.10883 as at 30 June 2023).
Numbers presented may not add up precisely to
the totals provided due to rounding.
1. Includes assets exchanged to be settled and
real estate finance loans by property. Sub totals
exclude cash and other assets.
16 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 17
LISTED: 825 ANN STREET, FORTITUDE VALLEY QLD
Chairman’s report
On behalf of the Centuria Capital Group
Board, it is my pleasure to introduce the
Group’s 2023 Annual Report.
Whilst we do not find ourselves in a Weimarian dystopia, the
year was defined by a historically steep escalation of interest
rates as the Reserve Bank increased the official cash rate ten
times, bringing the policy rate from 0.85% to 4.10% – all within
the FY23 period. This dizzying increase signaled a departure
from COVID-related emergency rates to current levels in a bid to
control an inflation rate not seen in decades.
It is hoped that we are at or near the peak of the Interest rate
rise cycle globally. Either way, FY24 is a transitory period for
many businesses as this rather harsh interest rate cycle tests
business models for vulnerabilities. In this context, we believe
opportunities are available to quality business models that
can absorb these financial conditions and more specifically, to
those which can adapt and diversify quickly to take advantage
of rapidly changing market factors.
An advantage of Centuria’s enlarged, diversified platform is
that the breadth of real estate markets we operate within
enables us to use counter-cyclical, strategic growth levers.
Having operated for over 25 years in our current iteration, we
intimately understand the peaks and troughs that run through
the traditional real estate markets while affording us some
foresight to capitalise quickly on emerging alternative markets.
Your Board and management comprehend mid to long-term
investment cycles – one of the benefits of experience.
Performance
As FY23 unfolded, it became apparent that the alternative real
estate sectors would continue to drive the Group’s growth.
Agriculture, credit and industrial sectors, were the engine of the
business.
In particular, as traditional debt providers tighten their lending
criteria, non-bank real estate finance, provided by Centuria
Bass, offers a credible and attractive solution to developers
who are reacting to a nation-wide shortage of developable
residential land and housing. With interest rates at present
levels, and credit criteria unchanged in traditional debt markets,
Centuria Bass is able to offer Centuria investors attractive
returns through our credit funds. This part of the business has
enjoyed spectacular growth during FY23 and is positioned to
accelerate that growth throughout FY24.
Appetite from institutional investment grew as Centuria
extended its relationship with Morgan Stanley Real Estate
Investing (MSREI). During the previous period, we reported
a healthcare-focused joint venture with MSREI and it is my
pleasure to announce in FY23, another venture partnership was
established between MSREI and CIP called the Centuria Prime
Logistics Partnership. Centuria will continue to explore further
institutional partnerships while seeking to expand its existing
mandates, including those within the retail and office sectors.
Chairman's report
Talent and leadership
While our governance initiatives embrace internal talent
management and leadership, I would like to specifically
call out our exceptional human resource undertakings
during the year. To begin, Centuria was named as part of
the 2023 AFR Best Places to Work in Australia and New
Zealand. Specifically, we are considered among the top 10
best places to work within the property, construction and
transport category.
This external endorsement further supports the positive
responses from our 2023 Engagement Survey, which
incorporated feedback from 90% of our workforce.
Highlights include:
• 92% believe their manager genuinely cares about their
wellbeing;
• 91% don’t hesitate to raise identified risks with their
manager;
• 89% know what they need to do to be successful in their
role; and
• 88% are proud to work for Centuria.
We are also above the industry average in areas including:
• Leadership – 76% have confidence in Centuria’s leaders
who keep their teams informed, share the company’s
vision and demonstrate their team is important to the
Group’s success.
• Learning and development – three in four Centurians
(74%) believe the company supports their development
and career aspirations as well as provides them with
career opportunities.
Taking into consideration feedback from the survey,
and as a consequence of COVID impacts, Centuria has
placed concerted attention on our workforce’s mental
health. To this end, each office has undertaken mental
health workshops and a mental health program has been
implemented.
Other new programs introduced throughout the year
include employee-nominated recognition awards
(aligned to our corporate values and capabilities), Lunch
and Learn education workshops, new onboarding/
offboarding systems, a new manager orientation
program, a new starter buddy program and interview/
recruiting training. We continue to foster emerging talent
as part of the Group’s succession planning.
As markets become more challenging, we recognise it
is crucial to continue the development of our personnel
and retain an experienced, exceptional team. With leaders
such as John and Jason, our Joint CEOs, Andrew Hemming
(Healthcare), Mark Francis (Centuria NZ), Nicholas Goh and
Giles Borten (Centuria Bass Credit), the Board and I remain
confident in our team's abilities to navigate through the
challenges that lie ahead in FY24.
In office, the work from home phenomena has slowly
become more transparent and the arguments more
grounded. There are advocates on both sides and
unquestionably what offices will look like in a decade will
change. There does seem to be growing unanimity that
building the culture of a business is well-nigh impossible
when people cannot sit and meet in person – performance
aside. Offices are not going anywhere – how and when
they are used in the future might be a different discussion.
Whilst prognostication is a dark art, we do know as fact
that our underlying office portfolio metrics show year-
on-year occupancy improvements, low vacancy rates and
significant leasing activity. Location plays a factor as do our
high sustainable ratings and modern amenities. There is a
flight to quality.
Centuria’s 2023 Office Tenant Survey found c.75% of
respondents anticipate retaining or increasing their space
requirements throughout the medium-term. Furthermore,
c.80% are working full time or up to four days per week at
their commercial premises. In addition to these industry
trends, the survey also revealed three in four tenants
(75%) are ‘extremely’ to ‘very satisfied’ with Centuria’s
in-house property and facility management team. In
total, 90% of respondents would ‘likely’ to ‘extremely
likely’ recommend Centuria to a friend or colleague. This
is testament to Centuria’s strong, proactive inhouse
management capabilities. Being at the coalface of tenant
relations – no matter what property sector – is vital for
sustained growth throughout the company.
Sustainability
During FY23, Centuria further advanced its commitment
to environmental, social and governance initiatives,
including the formal launch of our ESG Policy, endorsed
by the ESG Board. Shortly, we will be delivering our third
Sustainability Report, which highlights the increased
volume of initiatives across Australia and New Zealand. As
the company evolves, so too does our commitment to the
communities in which we operate.
During the year, the Board and management examined the
identity of our enlarged Group following the successful
integration of Heathley, Augusta Capital, Primewest and
Bass Capital. To ensure we are a cohesive and focused
unit, we analysed our corporate strategies to determine
our mission. I am pleased to highlight our new Purpose
Statement, as outlined on pages 8-9 of this report –
"We transform real estate opportunities into compelling
investments, which create sustainable long-term value for
our stakeholders and the communities in which we operate."
This statement is fundamental to our approach and how
we wish to be perceived in the market and it underpins
our attention and intention to deliver results for you, our
securityholders.
We continue our commitment to improved diversity within
the Group and I am indebted to Susan Wheeldon as Chair of
the Culture and ESG Committee, who has ensured that we
will be putting appropriate metrics around all our targets to
ensure they can be both managed and measured.
Garry Charny
CHAIRMAN
“An advantage of
Centuria’s enlarged,
diversified platform
is that the breadth of
real estate markets we
operate within enables
us to use counter-
cyclical, strategic
growth levers.”
18 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 19
Chairman's report
Conclusion
As alluded to earlier, Centuria has operated throughout
various challenging economic environments.
Whilst we do not believe the current conditions to
be similar in extent to the Global Financial Crisis, the
disciplines learned in that environment and the lens
that the Board and management bring to vetting new
opportunities and to capital management have been well
integrated into our risk framework.
It is only through a combination of impartial and decisive
discipline in decision-making, together with the ability to
perceive and execute on new opportunities, that Centuria
will continue to deliver rewarding results to its investors.
This combination of restraint and initiative is something
we deal with daily and we take great pride in delivering in
difficult circumstances as well our ability to quickly ramp
up activity and earnings as markets stabilise and improve.
My thanks to my fellow Board members at both the Group
and Responsible Entity level as well as to the wider
management in Australia, New Zealand and the Philippines.
This is a group of hard working, well-motivated people who
discharge their responsibilities with great care and pride
and I am honored to work with them.
Finally, I need to make a special mention of Peter Done who
is retiring from the Centuria board at the end of his current
term. We are continuously conscious of, and active in, our
Board renewal strategy. Nonetheless, Peter will be a great
loss. He has sat as the Chair of Audit, Risk and Compliance
Committee for as long as I have been Chairman and
for some time before that. His contribution has been
extraordinary and his diligence and quiet assurance has
made Centuria a better company. I am pleased that he
will not be lost entirely to the Group through his ongoing
directorships of the Responsible Entities for COF and CIP.
In the meantime, I look forward to welcoming you all to
our Annual General Meeting, both physical and virtual, in
mid-November.
Garry Charny
CHAIRMAN
Key metrics: Delivering strong growth and creating
value across the platform
Execution of diversity strategy
$21.0bn
Group AUM¹
14.5cps
FY23 OEPS2 delivered
$1.4bn
FY23 gross real estate
activity3
91%
Recurring revenues of
FY23 total Group revenues
11.6cps
FY23 DPS delivered
+5.5% over FY22
$1.6bn
Development pipeline4
1. AUM includes assets exchanged to be settled, cash and other assets and the impact of revaluation during the period.
2. Operating EPS (OEPS) is calculated based on the Operating NPAT of the Group divided by the weighted average number of securities.
3. Includes $811m of acquisitions exchanged and settled in FY23, $34m exchanged in FY23 yet to settle and $542m of real estate finance
transactions.
4. Development projects and development capex pipeline, including fund throughs. Committed development pipeline $0.8bn, future pipeline
$0.8bn.
20 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 21
LISTED: 12-13 AND 14-17 DANSU COURT, HALLAM VIC
Joint CEOs' letter
John McBain
JOINT CEO
Jason Huljich
JOINT CEO
It is our pleasure to present Centuria
Capital Group’s 2023 Annual Report.
Growth during the 2023 financial
period (FY23) was a function of
strong recurring earnings coupled
with continued execution of our
diversification strategy which led to
Group assets under management (AUM)
growing to $21 billion1 by the end of the
period.
While the Group continued to operate in its established
industrial, retail, healthcare and office sectors, during
FY23 it rapidly expanded into new alternative sectors
including real estate finance (+59% to $1.3 billion) and
agriculture (+33% to $0.53 billion), resulting in $1.4 billion
of gross real estate activity2 together with a $1.6 billion
development pipeline3.
As market conditions across Australia and New Zealand
changed throughout FY23, Centuria’s suite of investment
products broadened to match investor appetite. With two
thirds of the Group's real estate AUM weighted towards
unlisted real estate funds, it was pleasing to see the
unlisted platform benefitting from $0.6 billion of capital
inflows during FY23.
1. AUM includes assets exchanged to be settled, cash and other assets and the impact of revaluations during the period.
2. Includes $811m of acquisitions exchanged and settled in FY23 and $542m of real estate finance transactions.
3. Development projects and development capex pipeline, including fund throughs.
The resilience of Centuria's retail distribution network
during challenging periods for the equity capital markets
underpins the Group's ability to create and raise equity for
new unlisted funds and the launch of the new $324 million
Centuria Agriculture Fund during FY23 is an excellent
example of this resilience.
Institutional capital investment with Centuria continued
to expand by 11% to $2.1 billion during FY23 and securing
an additional $500 million logistics mandate, post balance
date, further demonstrates the Group's ability to expand its
range of capital sources.
Looking across our real estate platform, Centuria
continued to effectively manage its diversified portfolios,
led by an active in-house management team who provide
a hands-on approach to ensure high tenant satisfaction
and well performing assets. The platform’s scale continues
to deliver high recurring revenues, accounting for
91% of total revenues, as well as continued access to
establishment and performance fees.
Financial results
Despite the prevailing macroeconomic conditions,
the Group has remained strong due to its scale and
diversification. Centuria delivered statutory NPAT of
$105.9 million1, operating NPAT of $115.6 million2 and a
distribution of 11.6cps, which were all higher than FY22.
Distributions, as well as operating EPS of 14.5cps3, were in
line with FY23 guidance.
Centuria delivered record earnings before interest and tax
(EBIT) of $166.8 million, up 7.5% on FY22. Property funds
management increased 6% to $84.1 million4, underpinned
by the full year impact of platform expansion in FY22.
Transaction fee income of $26 million was generated
from $2.4 billion of total transaction activity. Performance
fees of $28.5 million were realised while the Group has
a further $126 million of embedded latent unrecognised
performance fees.
Co-investment earnings increased 8% to $52.4 million,
reflecting the increased capital deployed to support
the unlisted funds business. Development revenue
experienced significant growth of 45% to $9.4 million,
underscoring the talent of the in-house team who
leveraged its active projects pipeline and delivered profits
on recently completed projects, despite challenging
market conditions. Centuria Bass also significantly
increased real estate credit finance operating profitability
by 61% to $6.6 million, reflecting its considerably
increased loan book. The Investment Bonds business
delivered an operating profit of $3.5 million, down from
FY22 due to a one-off fee recoupment following the
Joint CEOs' letter
unitisation of capital guaranteed products. Corporate
overheads were substantially reduced primarily through
initiatives deployed across travel, consulting, and other
controllable overheads.
The Group’s balance sheet remains conservative with a net
asset value of $1.77 per security as at 30 June 20235, up
four cents per security on FY22. Throughout FY23, Centuria
increased its funding optionality with a new five-year $50
million debt facility secured in addition to the $67 million
re-finance in near-term maturities. As at 30 June 2023,
Centuria lowered its operating gearing ratio to 10.6%6
(HY23: 17.3%), while realising $237 million of cash from the
sale and recycling of balance sheet assets. Importantly,
Centuria’s balance sheet is positioned to fund organic
growth with $329 million of cash and undrawn debt.
Centuria benefits from a net operating interest cover
ratio (ICR) of 5.0 times, which despite recent increases
in financing costs, represents a significant buffer above
covenant requirements of 2.0 times. Centuria further
broadened its debt sources and risk concentration to 24
lenders. Lending facilities across the entire Group total
$8.2 billion, which covers more than 120 funds with a
weighted average debt duration of 2.2 years, reflecting
the typical lending term of up to five years in Australia and
up to three years in New Zealand. The Group’s weighted
average hedging profile is 52% at 30 June 2023 with a
weighted average duration of 1.8 years, broadly aligned
with debt duration. During FY23, approximately 60% of all
funds were refinanced. This significant, proactive capital
management has enhanced Centuria’s understanding of
lenders’ appetite while building stronger relationships with
our financiers.
Real estate platform
At 30 June 2023, the Group managed7 c.420 assets, leased
to ~2,500 tenants. Lease terms were agreed over more
than 548,000sqm across 542 transactions, representing
13% of the total platform. This significant leasing activity,
secured on strong tenant covenants, resulted in rent
collections across the platform remaining high at 99%.
During the period, the weighted average capitalisation
rate across the Group was 5.81%. Our real estate platform
provides robust fundamentals including a high 97%
occupancy rate and a 6.1-year WALE.
Two-thirds of Centuria’s real estate platform comprises
unlisted funds ($13.8 billion) and a third, listed funds ($6.4
billion). In terms of asset sector exposure, only a third
of the Group’s platform comprises office assets ($7.26
billion) while the remainder comprises industrial, retail and
alternative property sectors.
1. Attributable to CNI securityholders.
2. Operating NPAT of the Group comprises of the results of all operating segments and excludes non-operating items such as transaction costs, mark to
market movements on property and derivative financial instruments which are the results of Benefit Funds, Controlled Property Funds and share of
equity accounted net profit in excess of distributions received.
3. Operating EPS is calculated based on the Operating NPAT of the Group divided by the weighted average number of securities.
4. Excluding performance fees.
5. Number of securities on issue 30 June 2023: 799,796,794 (at 30 June 2022: 792,787,120).
6. Gearing ratio is calculated based on (operating borrowings less cash) divided by (operating total assets less cash).
7. Tenancy profile is shown aggregated across all funds managed by Centuria and is not representative of any single fund or property. Excludes land,
Development assets, US syndicates, Centuria Bass Credit, assets exchanged yet to be settled.
22 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 23
Joint CEOs' letter
Joint CEOs' letter
Gross real estate activity of $1.4 billion1 comprised $811
million of real estate acquisitions and $542 million of
real estate finance. Additionally, $400 million of gross
development projects were completed during FY23.
Centuria’s office portfolio provides a high 94% total
occupancy rate and remains exposed to Australia’s better-
performing office markets. There remains a bifurcation
within domestic markets based on asset size, quality and
leasing risk. With Centuria’s average office value of less
than $100 million, its assets provide exposure to a deeper
transaction pool. Throughout FY23 Centuria divested five
office assets at an average 4.5% premium to prior book
value, demonstrating investment appetite for smaller
metropolitan and near city office assets. In FY23, a 50%
interest was secured in the $223 million Allendale Square
office tower, WA, for an unlisted wholesale fund.
On the industrial front, the domestic market continues to
provide strong tailwinds with Australia having the lowest
vacancy rate, globally, at 0.6%2. Centuria’s ~$6 billion
industrial portfolio is strategically positioned to build
critical scale within urban infill markets, where occupier
demand remains highest and land is most constrained.
During the period, rental levels from our industrial assets
improved significantly, particularly in the second half of
the year with average re-leasing spreads reaching 37% in
the CIP portfolio. Several industrial assets were secured
for both Australian and New Zealand unlisted funds during
the period.
Centuria's Institutional AUM stood at $2.1 billion as at
year end - FY23. Post balance date, the Group announced
a further institutional mandate known as the "Last Mile
Logistics Partnership". This is a $500 million mandate
on behalf of a US private investment firm which was
seeded with a $76 million logistics portfolio bringing total
Institutional Investment within the Group to $2.2 billion of
AUM. Owing to favorable market conditions in the industrial
market, in particular the tightly held last-mile infill market,
the Group believes that considerable growth is available
within this mandate.
Centuria’s $3.2 billion retail portfolio is exposed to daily
needs retail (DNR), underpinned by non-discretionary
spending, and large format retail (LFR), aligned to
household needs. Approximately 44% of Centuria’s DNR
income is derived from supermarkets, providing a resilient
revenue flow. The Group’s LFR sites have low site coverage
which, like industrial, provides value-add opportunities.
Average re-leasing spreads for the Australian LFR portfolio
were 11%, including 8% for existing tenants and an
impressive 24% for new leases. During the period, Centuria
expanded its unlisted DNR assets with two wholesale
funds, which were fully subscribed.
Approximately half of Centuria’s $1.67 billion healthcare
platform comprise short-stay and day hospitals, making
Centuria one of the largest, non-operator landlords in
Australia. Our healthcare facilities lend themselves to
operational efficiencies, leading to better patient outcomes
and cost efficiencies. The Group’s in-house development
team is currently progressing a $360 million gross
development pipeline for our unlisted healthcare funds.
Across Centuria’s $0.53 billion agriculture platform, the
Group has focused on precision farming assets – and more
specifically protected cropping. The three agricultural assets
acquired in FY23 are high quality glasshouses, lending
themselves to highly sustainable farming methods. Centuria
is now Australia’s biggest large-scale glasshouse landlord.
The unlisted open-ended Centuria Agriculture Fund (CAF)
acquired two additional glasshouses for a combined
$143 million and Centuria NZ Agricultural Property Fund
launched, seeded with an $18 million glasshouse.
As mentioned, the $1.27 billion Centuria Bass real estate
finance platform experienced strong growth as the
property industry looked to non-bank financing when
the big four banks tightened their lending criteria. This
business provides loans to developer and investor clients
and develops debt fund opportunities for Centuria's
wholesale investor clients. During FY23, Centuria Bass
launched four single-asset wholesale credit funds, which
were fully subscribed, in addition to expanding the open-
ended Centuria Bass Credit Fund. We anticipate that
during FY24, demand for Centuria Bass debt funds from our
distribution network will be very high and believe this will
be an important revenue-driver for the Group.
These seven asset classes are further supported by
newly constructed modern and sustainable properties
generated from Centuria’s in-house development division.
During FY23, Centuria delivered $400 million of projects
throughout Australia and New Zealand. Projects i.e.,
property upgrades, refurbishments, and redevelopments
as well as new assets for the Group’s listed and unlisted
funds. Our award-winning in-house development team
is also progressing $821 million of committed projects
alongside a further $809 million of future projects.
Systems and processes
The backbone of Centuria’s expanding real estate
platform and financial systems is its operations. Following
corporate acquisitions in previous reporting periods and
the integration of an enlarged workforce and additional
business lines, Centuria significantly enhanced its systems
and processes as part of the Group’s commitment to
improving efficiencies and proactively managing costs.
This extends to the continued integration of Primewest
commercial property services into Centuria’s infrastructure
as well as the transition of Primewest funds into Centuria’s
property and financial management systems.
We have implemented an integrated customer relations
management solution throughout the Australian and New
Zealand businesses and furthermore, to support business
growth, we expanded the back-end operations capability
expanded in Centuria’s Manila office. Combined with a
strategy to deploy increased automation, this is expected
to deliver future cost savings.
Looking ahead, increased integration is expected
across the Group’s Treasury function with the impending
implementation of a unified treasury management
solution. The importance of IFRS sustainability standards
means the Group will continue investing in enhanced data
collection, storage, aggregation and reporting systems
in preparation for its introduction. Centuria reiterates its
continued commitment to strengthening cyber defences
while complying with APRA's information security
framework CPS234.
Environmental, social and governance
considerations
Centuria also continues its commitment to Environmental,
Social and Governance initiatives through its flexible
and relevant sustainability framework. During the period,
Centuria released its ESG Policy and launched new
sustainability targets including:
• Targeting Zero Scope 2 emissions by 2035 with our
portfolio being powered by the equivalent of 100%
renewable electricity through a combination of onsite
solar and large-scale generation certificate deals which
match our consumption.
• Eliminating gas and diesel where practicable, by 2035
from equipment owned and operated by the Group1.
The Group expanded the number of buildings expected
to achieve a 5-star Green Star rating with new assets
delivered for our REITs by the in-house development team
during the period.
Centuria has continued its 10-year support of St Lucy’s
School in New South Wales, which provides education to
students with disabilities. Additionally, Centuria supported
a range of interstate charities with relevance to the
particular local communities in which Centuria operates.
The Group supports a diverse workplace culture, and we
are proud to have increased female participation in our
workforce to 45%. We have continued our intern program
and during FY24 will also implement a new scholarship
program. These initiatives are designed to raise awareness
of the opportunities for young people in the financial
services sector and also provide an opportunity for us to
continue to broaden diversity within the business.
Finally, our employee engagement surveys during the
period disclosed that 88% of staff are proud to work at
Centuria.
Outlook
Centuria’s reputation as a funds manager is built on our
ability to adapt to market changes by unlocking innovative
new products. We have a strong focus on alternative,
well-performing real estate sectors to expand our platform
and deliver diversified income sources – which is one of
Centuria’s 'points of difference'. In addition to our recent
success in alternative sectors we will also continue to
harness the strong tailwinds from the industrial sector.
Centuria continues to execute on its strategy against a
backdrop of 10 cash rate hikes and high inflation. A level
of interest rate uncertainty still exists moving into FY24,
but market sentiment indicates interest rates should
stabilise allowing markets to begin the journey towards
normalisation.
We want to ensure we are well positioned to continue
our upward growth trajectory as markets normalise,
which we refer to as our 'through cycle' approach.
Accordingly, Centuria will navigate what we believe will be
a challenging FY24 backdrop, relying on our experienced
management team, with guidance from the Board, and
maintain a disciplined, strategic approach to capital
management.
Centuria has provided FY24 OEPS guidance2 of 11.5 to
12.0cps and DPS guidance2 of 10.0cps. This guidance is
set at levels that reflects our best estimate of earnings
based on the current challenging market conditions.
The guidance anticipates restrained transaction
volumes in FY24 compared to previous periods together
with increased finance costs - both acting to subdue
profitability marginally until markets normalise.
Last but not least, we thank our team across Australia, New
Zealand and the Philippines for their loyalty and dedication
throughout a challenging trading period. Similarly, we thank
the Chairman and Board of Directors across the Group
and Responsible Entity boards as well as our external
committees whose guidance and support are invaluable to
the company’s success.
Most of all we thank you, our securityholders, for your
ongoing confidence and support. We look forward to
updating you throughout FY24.
John McBain
Jason Huljich
JOINT CEO
JOINT CEO
1. Includes $811m of acquisitions exchanged and settled in FY23 and $542m of real estate finance transactions.
2. Source: CBRE Research Q2 2023.
1. Gas and diesel equipment owned and operated by our tenants are excluded from Centuria’s sustainability target.
2. FY24 guidance announced on 18 August 2023.
24 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 25
1. FY24 guidance announced 18 August 2023.
Key financial metrics
Operating net profit after tax ($m)1
Operating earnings per security2 (cents)
114.5
115.6
14.5
14.5
12.7
12.0
12.0
70.2
53.3
45.7
FY19
FY20
FY21
FY22
FY23
FY19
FY20
FY21
FY22
FY23
Distributions per security (cents)
Net assets per security ($)3
9.25
9.70
10.00
11.00
11.60
1.92
1.73
1.77
1.44
1.32
FY19
FY20
FY21
FY22
FY23
FY19
FY20
FY21
FY22
FY23
Statutory net profit after tax ($m)4
143.5
105.9
50.9
21.1
FY19
FY20
FY21
FY22
FY23
(37.9)
LISTED: 56-88 LISBON STREET, FAIRFIELD NSW
UNLISTED: WESTSIDE PRIVATE HOSPITAL, TARINGA QLD
1. Operating NPAT of the Group comprises the results of all operating segments and excludes non-operating items such as transaction costs, mark
to market movements on property and derivative financial instruments, the results of Benefit Funds, Controlled Property Funds and share of equity.
accounted net profit in excess of distributions received.
2. Operating EPS is calculated based on the operating NPAT of the Group divided by the weighted average number of securities.
3. Number of securities on issue 30 June 2023: 799,796,794 (at 30 June 2022: 792,787,120).
4. Attributable to CNI securityholders.
26 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 27
FY24 guidance anticipates lower performance fees and development profits, restrained transaction volumes and increased finance costs.11.5-12.0cps 10.0cpsFY24 OEPS guidance1 FY24 DPS guidance1 Diversified funds management platform
Assets under
management
(AU$ billion)
34%
CAGR1
4.9
1.9
2.1
0.9
FY18
6.2
2.6
2.7
0.9
FY19
8.8
4.0
4.0
0.8
FY20
1. CAGR calculated from 30 June 2018 to 30 June 2023.
28 | Centuria Capital Group – Annual Report 2023
20.6
13.0
21.0
13.8
Unlisted real estate
6.8
6.4
0.8
FY21
0.8
FY23
Listed real estate
Investment bonds
17.4
11.0
5.5
0.9
FY21
8 CENTRAL AVENUE, EVELEIGH NSW
FY23 Group AUM movement1
(AU$ billion)
20.6
0.8
0.5
0.2
-0.5
-0.6
21.0
FY222
Property
acquisitions
Centuria
Bass Credit
Development
capex spent
during the period
Property
divestments
Valuations
FY23
Note: Assets under management (AUM) as at 30 June 2023. All figures above are in Australian dollars (currency exchange ratio of AU$1.000:NZ$1.10883 as
at 30 June 2023). Numbers presented may not add up precisely to the totals provided due to rounding.
1. AUM includes assets exchanged to be settled, cash and other assets, and the impact of revaluation during the period.
2. Includes $403m of acquisitions exchanged at FY22 results that have since settled.
Centuria Capital Group – Annual Report 2023 | 29
Diversified funds management platform Centuria is a leading Australasian S&P/ASX 200 funds manager overseeing $21 billion of Group assets under management with the experience and potential to increase this pool of assets meaningfully over time.Centuria has a strong focus on alternative, well-performing real estate sectors to expand our platform and deliver diversified income sources – which is one of Centuria’s “points of difference”. Fund and capital allocation across Centuria’s platform
Centuria Capital Group – Annual Report 2023 | 31
UNLISTED: 132 BUSSELTON HIGHWAY, MARGARET RIVER WA
Fund and capital
allocation across
Centuria’s platform
Note: Assets under management (AUM) as at June 30 2023. All figures above are in Australian dollars
(currency exchange ratio of AU$1.000:NZ$1.0883 as at 30 June 2023). Numbers presented may not
add up to precisely to the totals provided due to rounding.
1. AUM includes assets exchanged to settled, cash and other assets and the impact of revaluations
during the period.
2. Platform total of $20.2bn includes Other AUM of $0.2bn across tourism and land syndicates in the
US, NZ and WA.
SECTOROfficeIndustrialDaily needs retailHealthcareLarge format retailReal estate financeAgricultureFUND TYPE/CAPITAL SOURCEAUM ($bn)17.36.01.71.71.51.30.5Unlisted closed-ended single and multi asset28.93.51.20.71.01.41.00.1Listed REITs26.42.53.9-- ---Unlisted open-ended2.80.20.70.80.20.20.30.4Unlisted institutional2.11.20.20.20.5---Diversified funds, capital sources, and investor profiles across all sectors. Our range of investment options provide varying risk/return alternatives to match investor appetites. Transaction fee income from $2.4 billion of total transaction activity
$1.4bn
FY23 gross real
estate activity
26
properties
29
real estate finance
loans
$542m
29 real estate
finance loans
Transaction fee income from
$2.4 billion of total transaction activity
Leveraging our transactions expertise and deep market relationships,
Centuria has a proven track record of securing high quality assets,
predominantly in off-market or select campaign situations.
Transaction fee income2 from
$2.4bn
of total transaction activity
$403m
Acquisitions exchanged in FY22 that have
since settled
3
2
Y
F
$811m
FY23 acquisitions
exchanged and
settled
$542m
FY23 real estate
finance
Real estate finance
Industrial
Office
Agriculture
$280m
11 properties
$263m
4 properties
$164m
3 properties
$510m
$122m
FY23 real estate
divestments
FY23 real estate finance
final settlements
Healthcare $73m
6 properties
Daily needs retail $31m
2 properties
I
G
N
O
G
N
O
$34m
Acquisitions exchanged, yet to settle fees recognised
Includes $811m of acquisitions exchanged and settled in at FY23 and $542m of real estate finance transactions.
1.
2. Transaction fee income for FY23 of $26.0m includes acquisition, financing, underwriting and sales fees.
32 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 33
UNLISTED: 208 FORDYCE ROAD, HELENSVILLE AUCKLAND
Strong active asset management
capabilities coupled with major
tenant partners
Centuria platform’s top 10 tenants by income (%)1,2,3
Government
Woolworths Limited
ASX/NZX listed
Telstra Corporation
ASX/NZX listed
Wesfarmers
ASX/NZX listed
Coles Group
ASX/NZX listed
Arnott’s
Multinational
Visy
Multinational
Heritage Lifecare
National
Flavorite
National
Super Retail Group
National
3.0%
1.9%
1.9%
1.8%
1.5%
1.5%
1.4%
1.2%
1.0%
Strong active asset management capabilities coupled with major tenant partners
13.0%
Centuria’s ability to effectively manage assets across our platform
benefits from integrated commercial property services and an active
management approach.
Solid real estate platform metrics1,2
~420
assets2,3
~2,500
tenants2,3
5.81%
weighted avg. capitalisation rate
97.0%
Platform’s total occupancy by area2,3
6.1 years
Platform’s weighted average lease
expiry (WALE) by income2,3
99.0%
Average rent collected over entire
platform2
548,000sqm+
FY23 leasing terms agreed (542 deals,
13% of total platform)
$42.5m
avg. asset value
1. Aggregated across funds managed by Centuria and not representative of any single fund or property.
2. Excludes land, development, US syndicates, Centuria Bass Credit, assets exchanged yet to be settled.
3. Tenancy profile is shown aggregated across all funds managed by Centuria and is not representative of any single fund.
Office
Industrial
Healthcare
Daily needs retail
Large format retail
Agriculture
34 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 35
UNLISTED: WOOLWORTHS OMNIA, POTTS POINT NSW
Platform1 diversification reduces
concentration risk
Platform diversification reduces concentration risk
Avg. asset
$m
Weighted avg.
cap rate2
Occupancy
%
%
Office
93.5
6.08
Industrial
Healthcare
Daily needs
retail
Large format
retail
Agriculture
Total avg.
35.9
5.38
15.2
40.8
5.68
5.96
38.8
5.95
47.0
5.87
42.5
Aids platform liquidity through exposure to a wider
transaction pool
5.81
Relatively wider cap rates compared to some peers
at this point in the cycle
93.8
98.0
96.3
96.8
98.3
100.0
97.0
High occupancies, strong leasing track record
Avg. tenancy
sqm
723
5,748
830
425
1,012
N/A
1,346
Smaller tenancies can appeal to a deeper pool of
occupiers
WALE
yrs
4.6
7.2
10.8
4.8
3.7
14.5
6.1
Staggered profiles with secure income streams
and opportunities to capture some compelling rent
reversions
1. Aggregated across funds managed by Centuria and not representative of any single fund or property.
2. Weighted average capitalisation rates measured from properties held at the start and end of FY23 period.
36 | Centuria Capital Group – Annual Report 2023
LISTED: 1 ASHBURN ROAD, BUNDAMBA QLD
Centuria Capital Group – Annual Report 2023 | 37
$1.6 billion development pipeline to
seed funds
The Group has a $1.6 billion development pipeline1. These projects include
opportunities to upgrade, refurbish and redevelop properties to create high quality
investment assets for our listed and unlisted funds.
$1.6 billion development pipeline to seed funds
$0.4bn
FY23 gross development
completions
$1.6bn pipeline1
Est. value on completion
Committed: $0.8bn2
Future: $0.8bn3
Development fees and
profits provide growing
income
Select FY23 development completions
Select project commencements
CNI strategically uses
its balance sheet to
seed and expand its
property funds
($43.6m carrying value)
57 WYATT STREET, ADELAIDE SA
• CNI balance sheet development
• Completed GAV: $38.1m
• Boutique office development consisting of six
floors of A-grade office space, amenity and a retail
tenancy
• 84% leased prior to PC
95-105 SOUTH GIPPSLAND HIGHWAY,
DANDENONG SOUTH VIC
• CIP fund through development
• Completed GAV: $101.2m
•
WINNER - INDUSTRIAL DEVELOPMENT
2023 Development Excellence Awards
90 BOLINDA RD, CAMPBELLFIELD VIC
204 BANNISTER RD, CANNING VALE WA
• CIP fund-through development
• 5-star Green Star certification
• 5 warehouse industrial estate with 45,000sqm GLA
• Due to complete in Q2 FY24
• CIP development
• Two industrial and logistics facilities of 3,500sqm
and 8,800sqm with corporate grade office space
and premium end of trip facilities
• Targeting a 5-star Green Star rating
• Due to complete in Q1 FY24
Note: All figures above are in Australian dollars (currency exchange ratio of AU$1.000:NZ$1.0883 as at 30 June 2023). Numbers presented may not add up
precisely to the totals provided due to rounding.
1. Development projects and development capex pipeline, including fund throughs.
2. Committed pipeline includes planning commencements and projects under construction.
3. Includes opportunities undergoing development assessments or pre-planning approvals.
38 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 39
Unlisted property
AUM growth to $13.8 billion (+6% above FY22)
Centuria has a strong weighting to unlisted property funds (63%). Centuria's unlisted
funds receive firm support from our 12,000 strong investor base and are a resilient,
defensive linchpin of our success.
~12,000
Australasian investors
$0.6bn
FY23 unlisted capital raising inflows
2-7
Funds in the Top 10 Index1 each quarter
for the last 30 quarters
52%
Unlisted AUM with no expiry or expiry
review dates at, or beyond, five years
34%
Unlisted AUM with no fund expiry
review date
$28.4m
FY23 recognised performance fees2
$126m
FY23 latent unrecognised performance
fees3
1. At least two funds in the top 10 in the Property Council of Australia/
MSCI Australia Unlisted Retail Quarterly Property Fund Index to 30
June 2023 each previous quarter for the last thirty quarters (overall
investment for the twelve months to the end of each quarter).
2. FY23 performance fee cash collected $0.1 million.
3. The total amount of latent (unrecognised) future performance fees
available to the Group are estimated at $126 million. Unrecognised
performance fees are estimated based on current property valuations
adopted within each fund and due to inherent uncertainties in
relation to the future performance of each property do not qualify for
recognition in the current period under Centuria's revenue recognition
policy and may not entirely eventuate.
UNLISTED: 52 CARIBOU DRIVE, DIREK SA
40 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 41
Select unlisted initiatives: • Centuria Agriculture Fund (CAF) - $324m• Allendale Square JV (MA Financial Group) - $223m• Centuria Bass Credit Fund - $98m• Centuria Bass Single Asset Funds - $76m• Centuria Industrial Income Fund No.2 - $35m • Centuria Agriculture Fund NZ - $17.5m• Centuria Busselton Boulevard SC Trust - $16m• Margaret River SC Trust - $15mInstitutional AUM grows 11% to $2.1 billion Unlisted mandates and partnerships support new investment opportunities. FY20FY21FY22$1.9bn$1.7bn$0.3bnFY23$2.1bn1Recently formed $181m Centuria Prime Logistics Partnership (CPLP) between CIP and MSREI sponsored vehicle$930m retail mandate in place$634m office mandate in place$215m1 Centuria Prime Partnership (Healthcare) with Morgan Stanley (MSREI) sponsored vehicleFamily office and select single asset JVs broaden capital pools1. Includes development projects on an accounting carrying value basis. Listed property:
AUM of $6.4 billion
ASX:COF
CENTURIA OFFICE REIT
Australia’s largest ASX-listed pure play
office REIT.
A quality portfolio of decentralised, strategically
located and affordable office space.
Included in the S&P/ASX
300 Index
4.2yrs
WALE2
Included in the FTSE EPRA
Nareit Global Developed Index
97%
occupancy2
$2.3bn
AUM
23
high quality assets
18.9%
$225m
debt refinanced
69%
hedging at FY24 commencement
36.7%
CNI co-investment1 highly aligned to an
experienced real estate funds manager
pro-forma gearing3,5 reduces following asset sales.
Staggered debt, no expiry until FY26
78%
$63m
of portfolio income from government, ASX-listed
and multinational tenants
divestments strengthen balance sheet and
demonstrate liquidity4
168,000sqm
(56% of portfolio NLA leased since COVID-19)
1. Includes ownership by associates of Centuria Capital Group.
2. By income.
3. Gearing is defined as total interest bearing liabilities divided by total assets.
4. Asset sales exchanged post 30 June 2023, FY24 target settlement.
5. Pro-forma gearing following asset sales post 30 June 2023.
42 | Centuria Capital Group – Annual Report 2023
Listed property: AUM of $6.4 billion
ASX:CIP
CENTURIA INDUSTRIAL REIT
Australia’s largest domestic ASX-listed
pure play industrial REIT.
A quality portfolio of fit for purpose industrial
assets, situated in infill locations with close key
infrastructure.
Included in the S&P/ASX
200 Index
98%
occupancy2
Included in the FTSE EPRA
Nareit Global Developed Index
$300m
exchangeable issuance increases debt diversity
$3.9bn
AUM
89
high quality assets
16.1%
CNI co-investment1 highly aligned to an
experienced real estate funds manager
88%
hedging at FY24 commencement
37%
2H23 avg. Re-leasing spreads6
33.1%
gearing3, staggered debt, no expiry until FY25
87%
$215m
of portfolio income from ASX-listed, national and
multinational tenants
divestments strengthen balance sheet and
demonstrate liquidity
7.7yrs
WALE2
1. Includes ownership by associates of Centuria Capital Group.
2. By income.
3. Gearing is defined as total interest bearing liabilities divided by total assets.
4. Asset sales exchanged post 30 June 2023, FY24 target settlement.
5. Pro-forma gearing following asset sales post 30 June 2023.
6. On a net rent basis compared to prior passing rents. FY23 avg. Re-leasing spreads of 30%.
Centuria Capital Group – Annual Report 2023 | 43
Centuria Life
Centuria Life
LifeGoals investment bond is a simple tax effective solution
to achieve long term financial goals.
$0.8bn
AUM
8.3%
total Australian investment bond
market share1
Approved by a wide range of
dealer groups nationally
34 fund options
including two ESG fund options
Assets under management
FY23
$m
FY22
$m
FY23 change
(%)
Flows FY23:
applications
($m)
Flows FY23:
redemptions
($m)
Prepaid funeral plans (Guardian)2
539.7
536.6
0.58%
Unitised bonds (Centuria Life)
222.4
230.7
-4.59 %
Centuria LifeGoals
58.1
39.6
48.74%
Total
818.0
806.9
1.38 %
31.0
3.7
17.8
52.6
-45.6
-20.8
-2.8
-69.2
1. QDS report 31 March 2023.
2. Centuria Life Limited (CLL) is the key service provider to Over Fifty Guardian Friendly Society.
44 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 45
VALUED
STAKEHOLDERS
RESPONSIBLE
BUSINESS
PRACTICES
CONSCIOUS
OF CLIMATE
CHANGE
LISTED: NISHI, 2 PHILLIP LAW STREET, CANBERRA ACT
1. Centuria will account for zero Scope 2 emissions by being powered by the equivalent of 100% renewable electricity through a combination of onsite
solar and large-scale generation certificate (LGC) deals which match our consumption.
2. Centuria Capital Group will focus on eliminating gas and diesel where practicable, from equipment owned and operated by the Group. Gas and diesel
equipment owned and operated by our tenants are excluded from Centuria’s sustainability target.
3. Diversity number as at 30 June 2023 are representative of Centuria Capital Group.
4. Centuria Capital Group undertake regular employee engagement surveys. The reported figure is from the May 2023 survey results .
46 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 47
Select initiatives Launched new sustainability targets: • Targeting zero Scope 2 emissions1 by 100% electricity sourced from renewables by 2035• Focused on eliminating gas and diesel2 in operations where practicable by 2035Expanding total area of buildings expected to achieve a 5-star Green Star rating with new assets delivered for COF and CIP by Centuria's in-house development team45%3 female representation at Centuria (FY22: 41%)Employee engagement surveys revealed 88%4 of employees are proud to work at Centuria Released Centuria’s ESG Policy 10 years of continued support for St Lucy’s School (students with disabilities) Centuria’s 2023 annual Sustainability Report will be published in Q4 2023, providing details on wider ESG initiativesSustainability at CenturiaDeveloping a flexible and relevant sustainability framework. Sustainability at Centuria
Sustainability at Centuria
Our targets support global efforts to be 1.5°C aligned
At the end of FY23 Centuria announced new sustainability
targets, supporting global efforts to be 1.5°C aligned. This
requires us to materially reduce our emissions to help
limit the World’s warming to 1.5 degrees. We’ll do this by
achieving our sustainability targets.
They are:
1. Targeting zero Scope 2 emissions1 by 100% electricity
sourced from renewables by 2035.
2. Focused on eliminating gas and diesel2 in operations.
But, we’re not just stopping there, both the Centuria
Industrial REIT (CIP) and Centuria Office REIT (COF) have
announced their own short and medium term targets to
accelerate our efforts. Both REITs are targeting:
• Zero scope 2 emissions3 by 2028.
• COF is going even further and leading the charge
in eliminating, where practicable, gas and diesel in
operations4 ahead of 2035 by starting today.
5-star Green Star
development
pipeline
5-star Green Star
development
pipeline
2023
Set ESG Policy,
inclusive of
climate/carbon
Complete solar
feasibility
assessment
NABERS warehouse and
cold stores participation
Integrate ESG themes as
part of wider investment
approach for ASX:COF
and ASX:CIP
Target steps and timelines
Centuria Capital Group’s (ASX:CNI) sustainability targets are supported by short (1–3 year) and medium (4–7 year) term
targets announced by the business. The accumulated impact of these targets support a global effort to be 1.5ºC aligned.
Segment/Fund:
Centuria Capital Group (CNI) ASX:COF ASX:CIP Unlisted funds Developments
2024
Solar feasibility
assessment –
Healthcare and Retail
Pilot NABERS
ratings for
select assets
Participation in
NABERS Accelerate
program for other
asset classes
Begin to procure
renewable
electricity
through LGCs.
2026
Incorporate electrification
costs as part of asset
upgrades as funds roll over
Centuria will commence
reporting tenant Scope 3
emissions.
2025
Review process for
SBTi endorsement
Focus on fully
electric
development
pipeline
Mandate minimum
Green Star
certification for new
developments
Complete solar
deployment for COF
assets assessed as
viable.
COF will focus on the elimination of gas and diesel where practicable, from equipment owned and operated by COF. Gas and diesel equipment operated by our tenants are excluded from COF’s sustainability target.
COF will focus on the elimination of gas and diesel where practicable, from equipment owned and operated by COF. Gas and diesel equipment operated by our tenants are excluded from COF’s sustainability target.
CIP and COF powered
by the equivalent of
100% renewable
electricity, including
onsite solar
100% electric –
unless no viable
solution exists
Mandate fully electric
design and low embodied
carbon materials
1. Centuria will account for zero Scope 2 emissions by being powered by the equivalent of 100% renewable electricity through a combination of onsite
solar and large-scale generation certificate (LGC) deals which match our consumption.
2. Centuria Capital Group will focus on eliminating gas and diesel where practicable, from equipment owned and operated by the Group. Gas and diesel
equipment owned and operated by our tenants are excluded from Centuria’s sustainability target.
3. CIP & COF will account for zero Scope 2 emissions by being powered by the equivalent of 100% renewable electricity through a combination of onsite
solar and large-scale generation certificate (LGC) deals which match our consumption.
4. COF will focus on the elimination of gas and diesel where practicable, from equipment owned and operated by COF. Gas and diesel equipment operated
by our tenants are excluded from COF’s sustainability target.
48 | Centuria Capital Group – Annual Report 2023
2028
2035
Target
2035
Zero Scope 2
emissions1
Elimination of gas and
diesel2 in operations,
where practicable
Centuria Capital Group – Annual Report 2023 | 49
Sustainability at Centuria
Sustainability case studies
Centuria wins ‘Platinum’ and
‘Gold’ Waterwise Award
Among Exchange Tower’s outstanding water efficiency
initiatives, are:
• alarmed meters on its cooling towers
Exchange Tower and 140 St Georges Terrace were
recognised among Western Australia’s most water efficient
office buildings by the Water Corporation’s Waterwise
Development Program.
Exchange Tower is the recipient of the ‘Platinum’
Waterwise award, which recognises one business as a
leader in water efficiency, demonstrating best practice and
innovation in water management for the WEMP reporting
year. Exchange Tower is only the third commercial building
to be recognised as a Platinum Waterwise Building since
the program started in 2014 and follows Exchange Tower’s
‘Gold’ recognition in 2022.
• the introduction of high-efficiency units on bathroom
refurbishments.
In addition, the 140 St Georges Terrace team received the
Gold Waterwise Award.
Only Platinum and Gold Awards are provided by Waterwise.
The awards are a reflection of Centuria’s journey to
achieve greater water efficiency and general sustainability
outcomes through the development and implementation of
our Sustainability Roadmap.
PCA’s 500 Women in Property
In April 2023, the Property Council of Australia (PCA) accepted all Centuria nominees
for its 500 Women in Property program. This initiative is designed to help existing
PCA members to identify and champion women in their organisation, who they
believe would benefit from further networking and professional development
opportunities. The program aims to accelerate more women into leadership positions
in the property industry through sponsorship of high-potential talent.
Additionally, several Independent Non-Executive Directors from the Centuria
Capital Group boards offered to mentor these candidates in conjunction with their
participation in the PCA program. Centuria believes this added layer of mentorship
provided by female directors further supports our PCA 500 Women in Property
participants.
Sustainability at Centuria
$193,000 raised for St Lucy’s
School, Sydney
In June 2023, Centuria hosted its annual trivia fundraising
evening for St Lucy’s School, which provides education for
students with disabilities. The event was attended by 290
property, financial, legal and consulting professionals at the Ivy
Ballroom in Sydney. Money raised from the evening exceeded
$193,000, which is the largest amount raised since Centuria
began hosting the trivia evenings. The funds will be used for
the school’s Family Support and Psychology programs. Since
2008, Centuria has enjoyed a special relationship with St Lucy’s
School and looks forward to continuing to support the school
through our volunteer program and future trivia events.
Solar synergies in Broome
In 2017, Primewest (prior to merging with Centuria) commissioned
a 1.3 megawatt (MW) solar carport development at its Broome
Boulevard Shopping Centre, which is now the biggest of its kind
in Western Australia*. In December 2022, the system became fully
operational and is expected to provide c.44% of the shopping
centre’s electricity needs while reducing the equivalent of 1,540
tonnes of carbon dioxide per annum.
Use of the solar energy development is not only a sustainable,
green initiative but it has the added advantage of ensuring a
consistent electricity supply to the shopping centre to avoid
blackout periods during times of severe inclement weather.
Additionally, the system has been designed to avoid ‘black holes’
when large clouds pass by deploying a smoothing mechanism via
a 1 MWh battery to protect the network and ensure consistency.
In addition to the renewable energy, the 3,600 solar panels,
covering 8,000sqm, are mounted on a new car park canopy,
providing shade to 42% of the shopping centre’s 770 parking bays.
Some technical challenges that were overcome during the
construction process included:
• Achieving a cyclone-resistance rating
• Horizontal drilling for underground conduits with no access to
historical site plans
• Access and time to complete the works during inclement
conditions (Broome temperatures fluctuate between 13-44°C)
• Satisfying the Civil Aviation Safety Authority that the panels’
reflection would not affect safety/visibility at the neighbouring
airport
• Distance and access to skilled labour – Broome is 2,200km from
Perth.
*According to inhouse research the largest solar carports in Australia include: (1)
Vicinity’s shopping centres, South Australia – 3.2MW (2) Chadstone Shopping
Centre, Victoria – 1.6 MW, (3) Willows Shopping Centre Townsville, Queensland –
1.5 MW (4) Broome Boulevard, Western Australia – 1.3 MW (4) Broome Boulevard
1.3 MW, (5) The Pines Shopping Centre, Queensland – 1.0 MW
50 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 51
Board of Directors
Board of Directors
John McBain
Susan Wheeldon
John Slater
Jason Huljich
EXECUTIVE DIRECTOR
AND JOINT CEO
INDEPENDENT NON-EXECUTIVE
DIRECTOR
INDEPENDENT NON-EXECUTIVE
DIRECTOR
EXECUTIVE DIRECTOR
AND JOINT CEO
Garry Charny
CHAIRMAN
Kristie Brown
Peter Done
INDEPENDENT NON-EXECUTIVE
DIRECTOR
INDEPENDENT NON-EXECUTIVE
DIRECTOR
52 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 53
Board of Directors
Board of Directors
Garry Charny
CHAIRMAN
John McBain
EXECUTIVE DIRECTOR AND
JOINT CEO
Jason Huljich
EXECUTIVE DIRECTOR AND
JOINT CEO
Susan Wheeldon
INDEPENDENT NON-EXECUTIVE
DIRECTOR
Garry was appointed as Chairman of the Centuria Capital
Group Board on 30 March 2016. He has significant board
level experience with listed and unlisted companies
across a diverse range of sectors including property
(Trafalgar Corporate, which became 360 Capital, and
Manboom); retail (Apparel Group, Sportscraft, and Saba);
technology (General Electric EcXpress and 1st Available)
and media (Boost Media, Macquarie Radio, Spotted
Turquoise Films and April Entertainment).
Currently, he is Chairman, Managing Director and
founder of Wolseley Corporate, an Australian corporate
advisory and investment house that consults on local
and international transactions in the USA, United
Kingdom, Malaysia, India and throughout South-East
Asia. Wolseley specialises in mergers and acquisitions,
strategic corporate advice and contentious matters
resolution.
Garry is also Chairman of High End, an AI driven fashion
tech company, and Chairman of Shero Investments, a
Sydney based investment company.
In December 2022, he was appointed a Board Member of
Racing NSW.
Previously, he was co-founder and Chairman of Boost
Media International, an international media advisory
business with offices in Sydney, New York, Toronto, Kuala
Lumpur and Delhi. He was also President of Boost Media
LLC (USA).
From 1983 to 1995, Garry practised as a Barrister-at Law
at the Sydney Bar specialising in corporate, commercial,
equity and media. He was an Adjunct Lecturer in Law at
the University of NSW.
Joint CEO John McBain’s 40-year real estate career spans
the commercial and industrial markets in Australia, NZ and
UK and the healthcare and agriculture sectors. He graduated
from Auckland University with a valuation qualification.
He is an Executive Director of Centuria Capital Limited,
Centuria Life Limited, Centuria Healthcare Pty Ltd and
Centuria Property Funds No. 3 Limited (formerly Primewest
Management Limited) and a Non-Executive Director of
Centuria Bass Credit Limited. John is a Director of NZX-
listed Asset Plus Limited (NZX: APL). He also serves on
the Centuria NZ and Centuria Healthcare Management
committees and the Centuria Life Investment Committee.
John is responsible for Centuria’s corporate team, and
his responsibilities include corporate strategy, M&A and
leadership of the Finance, Governance, Compliance,
Investor Relations, Communications and Centuria Life
teams. He serves on the Non-Financial Risk Committee and
the ESG Management Committee.
John has been instrumental in the integration of several
businesses into the Centuria group, including the 360
Capital Group, Heathley Asset Management (now Centuria
Healthcare), Augusta Capital Limited (now Centuria NZ)
and the Primewest Group. These acquisitions, together
with a successful asset acquisition and funds management
programme overseen by fellow Joint CEO Jason Huljich, has
seen the pair oversee significant corporate growth over
the past 27 years culminating in Centuria Capital Limited
entering the S&P ASX 200 Index in 2021 with the group now
managing $21 billion of assets.
Susan joined the Centuria Capital Group Board as an
Independent Non-Executive Director in August 2016.
She brings extensive experience across international
commercial markets within ICT, real estate, legal,
aviation and online retail sectors.
Currently, Susan is Airbnb’s Country Director for
Australia, New Zealand and Oceania. Previously,
she served in a number of roles, including Head of
Government, Performance and Agency at Google,
working with major national and global companies.
During her career, Susan has held senior positions in
Australia and the United Kingdom across a diverse range
of industries including global law firms DLA Piper and
King & Wood Mallesons, working with the Virgin Australia
and Virgin Atlantic airline brands, as Vice President of
Groupon, and as Head of Brand and Retail at AMP Capital
Shopping Centres.
She holds an MBA from University of NSW's Australian
Graduate School of Management, and is a member of
Australian Institute of Company Directors as well as
holding a Corporate Director's Certificate from Harvard
Business School.
Joint CEO Jason Huljich’s 27-year real estate career
spans the commercial and industrial real estate sectors.
Jason is an Executive Director of Centuria Capital
Group, Centuria Life Limited, Centuria Healthcare Pty
Ltd, Centuria Healthcare Asset Management Limited,
Centuria Property Funds No. 3 Limited (formerly
Primewest Management Limited), as well as a director of
Centuria Funds Management (NZ) Ltd and Centuria NZ
Industrial Fund Limited, and Non-Executive Director of
Centuria Bass Credit Pty Limited.
Jason is Joint CEO alongside John McBain, collectively
overseeing $21 billion of assets under management.
Jason is chiefly responsible for the company’s real
estate portfolio and funds management operations
including the listed Centuria Industrial REIT (ASX:
CIP) and Centurial Office REIT (ASX: COF), as well as
Centuria’s extensive range of unlisted funds across
Australia and New Zealand.
Since Centuria was established, Jason has been pivotal
in raising over $5 billion for the listed and unlisted
vehicles. He has been central to positioning Centuria
as Australia’s fourth largest external property funds
manager. CNI and CIP are included in the S&P/ASX 200
Index. COF is included in the S&P/ASX 300 Index. CIP
and COF are part of the FTSE EPRA Nareit Global Index.
Jason has a hands-on approach to the real estate
operations throughout the Group’s platform. The
Transactions, Development, Funds Management,
Distribution, Marketing and Asset Management teams all
report directly to him.
Jason is a Property Funds Association (“PFA”) of
Australia Past President. The PFA is the peak industry
body representing the $125 billion direct property
investment industry. Jason currently sits on the Property
Council of Australia’s Global Investment Committee.
54 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 55
Board of Directors
Board of Directors
John Slater
INDEPENDENT NON-EXECUTIVE
DIRECTOR
Kristie Brown
INDEPENDENT NON-EXECUTIVE
DIRECTOR
Peter Done
INDEPENDENT NON-EXECUTIVE
DIRECTOR
John was appointed as a financial adviser to Centuria
Life Limited in 2011 and as a member of its Board in
2013. On 22 May 2013, he was appointed as a Director
of Centuria Capital Limited. He also serves on the
Nomination and Remuneration Committee
John was previously a senior executive at KPMG
Financial Services prior to establishing a financial
advisory practice. Since the sale of that practice, he has
focused on consulting activities and his non-executive
roles with Centuria.
John has deep experience in all financial market
sectors gained during his 35-year career. Over this
time, he has been directly involved with investments
and investment committees and sits on the Investment
Committees of Centuria Life and the Over Fifty Guardian
Friendly Society Limited. John continues to be active in
investment committee activities in other non-aligned
financial groups.
Kristie is an experienced real estate investment and
legal professional who was appointed to the Centuria
Board on 15 February 2021 as an Independent Non-
Executive Director as well as a member of the Group’s
Audit, Risk and Compliance Committee (ARCC) and the
Conflicts Committee.
Kristie has a background in corporate law with over 17
years’ experience in funds management and M&A. She
has practiced at Clayton Utz and Ashurst (then, Blake
Dawson Waldron) and has considerable experience
working with large corporations, fund managers, financial
institutions, private equity and hedge fund operators,
real estate investment trusts, developers and financiers.
Subsequent to her legal career, Kristie established a
private investment business, Danube View Investments,
which primarily operates in the Australian property
sector.
Kristie is also a founding partner of investment firm,
Couloir Capital, which was established in 2020 to invest
its own capital in unique investment opportunities and
to introduce such opportunities to like-minded family
office and high net worth investors.
Peter joined the Centuria Capital Group Board as an
Independent Non-Executive Director in November 2007.
He is also Chair of Centuria Capital Group’s Audit, Risk
and Compliance Committee.
Peter has extensive knowledge of accounting, audit
and financial management in the property development
and financial services industries, corporate governance,
regulatory issues and board processes through his many
senior roles.
Peter hails from a 38-year career at KPMG. From 1979, he
held the position of Partner until his retirement in 2006.
During his 27 years as Partner, Peter was the lead audit
partner for many clients, including those involved in
property development, primary production and television
and film production and distribution.
Peter holds a Bachelor of Commerce (Accounting) from
the University of New South Wales and is a Fellow of
Chartered Accountants Australia and New Zealand.
56 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 57
Senior executives
John McBain
Jason Huljich
EXECUTIVE DIRECTOR AND JOINT CEO
EXECUTIVE DIRECTOR AND JOINT CEO
Senior executives
Simon Holt
CHIEF
FINANCIAL
OFFICER
As Chief Financial Officer, Simon has been responsible for Centuria’s finance,
information technology and treasury functions since 2016. Alongside the Joint
CEOs, Simon is responsible for the Group’s expansion across Australia, New
Zealand and the Philippines, and he has been instrumental in debt and equity
raisings across all the Centuria listed entities, in particular Centuria Capital
Limited. Simon has more than 25 years’ experience across local and global
financial markets and has held a range of senior financial positions which
include Westfield Group and Westfield Trust. He is a Chartered Accountant and
holds a Bachelor of Business degree (Accounting and Marketing majors) from
the University of Technology, Sydney (UTS). He is also a Member of Australian
Institute of Company Directors and a licenced Class 1 Agent for Real Estate
Sales, Leasing and Auctions.
Anna
Kovarik
GROUP CHIEF RISK
OFFICER
AND COMPANY
SECRETARY
Anna joined Centuria as General Counsel and Company Secretary in 2018 and
was promoted to Group Chief Risk Officer and Company Secretary in 2020.
She is an experienced governance professional having worked with ASX-listed
and unlisted boards, predominantly within the listed property and financial
services sectors. In her current role at Centuria, Anna is responsible for legal,
risk management, regulatory compliance, insurance and governance activities
across the Group. Anna is a member of the Senior Executive Committee, the
Non-Financial Risk Committee and the ESG Management Committee. She
holds an Executive MBA from the University of Sydney and is a member of the
Australian Institute of Company Directors.
CEO of Centuria’s New Zealand division, Mark Francis, has a career spanning
more than 25 years across financial and real estate markets. He founded
Augusta Capital in 2001 and assumed his current position at the helm of
Centuria’s New Zealand entity following the companies’ merger. Mark is
responsible for overseeing a NZD$2.6 billion real estate portfolio spanning
office, industrial, healthcare, retail, agriculture and tourism assets across
listed and unlisted funds while managing a team of more than 40 staff across
three offices.
Ross is the Head of Real Estate Funds Management, responsible for both
listed and unlisted property funds in the office, industrial, retail, healthcare and
agricultural sectors. This includes Australia’s largest ASX-listed pure-play office
and industrial REITs (COF and CIP), and more than 100 open- and closed-ended
unlisted property funds with AUM exceeding $17 billion. Ross joined Centuria
in 2017 and has 20 years of investment management experience, having held
senior transactional and portfolio management positions for peers including
Dexus, LOGOS Group and Stockland.
As managing director of Centuria Healthcare, Andrew is responsible for strategic
business growth, deal origination, asset transactions, and leads a team of
healthcare property specialists. He has grown the business to 60 assets under
management worth c.$1.5 billion (as at 30 June 2023). Andrew has more than
20 years’ experience across investment markets including Australian and US
equity derivatives, fixed term interest markets and commercial real estate
sectors, the latter focused on healthcare property. His career includes senior
positions at investment houses including BNP Paribas, Merrill Lynch and
Folkestone.
Andrew joined Centuria Capital Group in early 2013 and for the past six years, as
Group Head of Transactions, has been responsible for originating and managing
the Group’s property transactions, across all real estate sectors, totalling more
than $9 billion of direct deals on behalf of the Group and its funds. Andrew has
15 years’ experience in the Australian property industry. Prior to his current role,
Andrew was Centuria’s National Leasing Manager and a Fund Manager and prior
to this, he worked in DTZ’s Sydney agency for six years.
Mark
Francis
CEO -
CENTURIA
NEW ZEALAND
Ross
Lees
HEAD OF FUNDS
MANAGEMENT
Andrew
Hemming
MANAGING
DIRECTOR,
CENTURIA
HEALTHCARE
Andrew
Essey
HEAD OF
TRANSACTIONS
58 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 59
Senior executives
Senior executives
André
Bali
HEAD OF
DEVELOPMENT
Victor
Georos
HEAD OF
PORTFOLIO
AND ASSET
MANAGEMENT
Michael
Blake
HEAD OF
CENTURIA LIFE
Since 2007, André has overseen all Centuria’s project and property development
functions, including development and debt funds. He is responsible for both
passive and active management of Centuria’s listed and unlisted portfolio
including capital works, planning, strategic repositioning of assets to maximise
returns, development and project management, joint ventures and partnerships
and working closely with Centuria’s leasing, capital transactions and funds
management teams. André has more than 30 years’ experience in development
and investment management across numerous sectors including office, health,
residential, industrial and retail.
Victor joined Centuria in 2013 and has operated in the commercial property
markets for over 30 years and has held previous senior roles at GPT and
Lend Lease. In his role he is responsible for overseeing portfolio and
asset management of Centuria’s portfolio, including the development
and implementation of strategies to enhance value through active asset
management and development. Victor has extensive experience in asset and
investment management, development and funds management, across the
office, retail and industrial sectors, with a key focus on results and ability to build
high performance teams across all sectors. Victor is a member of the Australian
Institute of Company Directors and manages the Centuria Property Fund’s
Valuation program and also serves on the Non-Financial Risk Committee.
With more than three decades in the wealth management across blue chip
Australian and multinational corporations, Michael Blake joined Centuria in 2016
and is currently the Head of Centuria Life. He is chiefly responsible for Centuria
Life’s P&L, strategic direction, funds under management growth, product
development and directly reports to the Centuria Life Limited (CLL) Board. Prior
to his current position, Michael was Head of Sales and Marketing at Centuria
Property Funds Limited. Michael holds a Bachelor of Financial Administration
from the UNE, a Diploma of Financial Planning from the RMIT, a MBA from
Macquarie University and is a graduate of the Australian Institute of Company
Directors. Michael has held Board and Investment Committee positions in
Australia and New Zealand.
Thomasina
Ralston
HEAD OF
MARKETING
Alexandra
Koolman
GROUP
COMMUNICATIONS
MANAGER
Emily Smith
HEAD OF
OPERATIONS
Thomasina joined Centuria in 2017 and is responsible for the Group’s full end-
to-end marketing strategy, planning and execution across Australia and New
Zealand, which incorporates brand positioning, real estate capital fundraising
campaigns and investment bond promotions. Thomasina has more than 20
years of marketing experience, with a focus on digital marketing within financial
services. Her achievements in campaign management are recognised with
marketing awards: MMAX’s 2022 Agency Campaign of the Year (winner) and
MMAX’s 2022 Video Campaign of the Year (finalist).
Alexandra joined Centuria in early 2020 and is responsible for internal and
external communications across Australia, New Zealand and The Philippines.
This extends to communications for listed and unlisted equity and debt funds,
corporate initiatives, ESG, development projects and investment bonds. She
brings 20 years of experience from domestic and international markets within
commercial property, residential, build to rent and development real estate
sectors.
Emily joined Centuria in mid-2016, holding various investment and corporate
positions before her promotion to Head of Operations in 2022. Emily is
responsible for the operational activities of the Group including policy and third-
party governance, implementation of technology solutions, and development of
efficient workflows to maximise productivity. Emily oversees registry services,
CRM, IT support, cyber security, HR platforms including engagement analysis,
document management, bank administration and is also the Internal Custodian
for the Group. She manages a team that spans across Australia, New Zealand
and The Philippines. Emily has 18 years’ experience having worked for industry
peers both in the financial services and property industries including Cromwell
Property Group.
60 | Centuria Capital Group – Annual Report 2023
UNLISTED: SUNDROP FARMS, PORT AUGUSTA SA
Centuria Capital Group – Annual Report 2023 | 61
Directors' report
For the year ended 30 June 2023
The Directors of Centuria Capital Limited (the
Company) present their report together with the
consolidated financial statements of the Company and
its controlled entities (the Group) for the financial year
ended 30 June 2023 and the auditor’s report thereon.
ASX listed Centuria Capital Group consists of the Company and its controlled
entities including Centuria Capital Fund (CCF). The shares in the Company and
the units in CCF are stapled, quoted and traded on the Australian Securities
Exchange (ASX) as if they were a single security under the ticker code CNI.
Directors and directors' interests
Directors of Centuria Capital Limited during or since the end of the financial year
are:
Name
Appointed
Directorship of other listed companies
Mr Garry S. Charny
23 February 2016
None
Ms Kristie R. Brown
15 February 2021
None
Mr Peter J. Done
28 November 2007
Centuria Industrial REIT (ASX:CIP)1
Centuria Office REIT (ASX:COF)2
Mr Jason C. Huljich
28 November 2007 None
Mr John E. McBain
10 July 2006
Asset Plus Limited (NZX:APL)
Mr John R. Slater
22 May 2013
Ms Susan L. Wheeldon 31 August 2016
None
None
1. Director of Centuria Property Funds No. 2 Limited ('CPF2L') as responsible entity for Centuria
Industrial REIT
2. Director of Centuria Property Funds Limited ('CPFL') as responsible entity for Centuria Office REIT
UNLISTED: VARSITY LAKES DAY HOSPITAL, VARSITY LAKES QLD
62 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 63
Directors' report
Directors' report
Mr Garry S. Charny, BA. LL.B.
INDEPENDENT NON-EXECUTIVE DIRECTOR AND CHAIRMAN
Ms Kristie R. Brown, B. Comm, B. Law (Hons)
INDEPENDENT NON-EXECUTIVE DIRECTOR
Mr Peter J. Done, B.Comm, FCA
INDEPENDENT NON-EXECUTIVE DIRECTOR
Mr Jason C. Huljich, B. Comm
EXECUTIVE DIRECTOR AND JOINT CHIEF EXECUTIVE OFFICER
Experience and expertise
Experience and expertise
Experience and expertise
Experience and expertise
Kristie is an experienced real estate investment and legal
professional who was appointed to the Centuria Board
on 15 February 2021 as an Independent Non-Executive
Director as well as a member of the Group’s Audit, Risk
and Compliance Committee (ARCC) and the Conflicts
Committee.
Kristie has a background in corporate law with over 17
years’ experience in funds management and M&A. She has
practiced at Clayton Utz and Ashurst (then, Blake Dawson
Waldron) and has considerable experience working with
large corporations, fund managers, financial institutions,
private equity and hedge fund operators, real estate
investment trusts, developers and financiers.
Subsequent to her legal career, Kristie established a
private investment business, Danube View Investments,
which primarily operates in the Australian property sector.
Kristie is also a founding partner of investment firm,
Couloir Capital, which was established in 2020 to invest
its own capital in unique investment opportunities and to
introduce such opportunities to like-minded family office
and high net worth investors.
Directorship of other listed companies
None
Responsibilities
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Boards
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Audit, Risk and Compliance
Committee
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Conflicts Committee
Interests in CNI
Ordinary stapled securities: Nil
Garry was appointed as Chairman of the Centuria Capital
Group Board on 30 March 2016. He has significant board
level experience with listed and unlisted companies across
a diverse range of sectors including property (Trafalgar
Corporate, which became 360 Capital, and Manboom);
retail (Apparel Group, Sportscraft, and Saba); technology
(General Electric EcXpress and 1st Available) and media
(Boost Media, Macquarie Radio, Spotted Turquoise Films
and April Entertainment).
Currently, he is Chairman, Managing Director and founder
of Wolseley Corporate, an Australian corporate advisory
and investment house that consults on local and
international transactions in the USA, United Kingdom,
Malaysia, India and throughout South-East Asia. Wolseley
specialises in mergers and acquisitions, strategic
corporate advice and contentious matters resolution.
Garry is also Chairman of High End, an AI driven fashion
tech company, and Chairman of Shero Investments, a
Sydney based investment company.
In December 2022, he was appointed a Board Member of
Racing NSW.
Previously, he was co-founder and Chairman of Boost
Media International, an international media advisory
business with offices in Sydney, New York, Toronto, Kuala
Lumpur and Delhi. He was also President of Boost Media
LLC (USA).
From 1983 to 1995, Garry practised as a Barrister-at Law
at the Sydney Bar specialising in corporate, commercial,
equity and media. He was an Adjunct Lecturer in Law at the
University of NSW.
Directorship of other listed companies
None
Responsibilities
• Chairman of the Centuria Capital Limited and Centuria
Funds Management Limited Board
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Nomination and
Remuneration Committee
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Conflicts Committee
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Culture and ESG Committee
• Chairman of the Centuria Life Limited Board
• Member of the Centuria Life Limited Audit Committee
• Member of the Centuria Life Limited Risk and
Compliance Committee
• Chairman of the Centuria Healthcare Pty Ltd Board
Interests in CNI
Ordinary stapled securities: 422,753
64 | Centuria Capital Group – Annual Report 2023
Peter joined the Centuria Capital Group Board as an
Independent Non-Executive Director in November 2007.
He is also Chair of Centuria Capital Group’s Audit, Risk and
Compliance Committee.
Peter has extensive knowledge of accounting, audit
and financial management in the property development
and financial services industries, corporate governance,
regulatory issues and board processes through his many
senior roles.
Peter hails from a 38-year career at KPMG. From 1979, he
held the position of Partner until his retirement in 2006.
During his 27 years as Partner, Peter was the lead audit
partner for many clients, including those involved in
property development, primary production and television
and film production and distribution.
Peter holds a Bachelor of Commerce (Accounting) from
the University of New South Wales and is a Fellow of
Chartered Accountants Australia and New Zealand.
Directorship of other listed companies
• Centuria Industrial REIT (ASX: CIP)
• Centuria Office REIT (ASX: COF)
Responsibilities
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Boards
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Nomination and
Remuneration Committee
• Chairman of the Centuria Capital Limited and Centuria
Funds Management Limited Audit, Risk and Compliance
Committee
• Member of the Centuria Life Limited Board
• Chairman of the Centuria Life Limited Audit Committee
• Chairman of the Centuria Life Limited Risk and
Compliance Committee
• Member of the Centuria Life Limited Investment
Committee
Joint CEO Jason Huljich’s 27-year real estate career
spans the commercial and industrial real estate sectors.
Jason is an Executive Director of Centuria Capital
Group, Centuria Life Limited, Centuria Healthcare Pty
Ltd, Centuria Healthcare Asset Management Limited,
Centuria Property Funds No. 3 Limited (formerly Primewest
Management Limited), as well as a director of Centuria
Funds Management (NZ) Ltd and Centuria NZ Industrial
Fund Limited, and Non-Executive Director of Centuria Bass
Credit Pty Limited.
Jason is Joint CEO alongside John McBain, collectively
overseeing more than $21 billion of assets under
management.
Jason is chiefly responsible for the company’s real estate
portfolio and funds management operations including
the listed Centuria Industrial REIT (ASX: CIP) and Centuria
Office REIT (ASX: COF), as well as Centuria’s extensive
range of unlisted funds across Australia and New Zealand.
Since Centuria was established, Jason has been pivotal in
raising over $5 billion for the listed and unlisted vehicles.
He has been central to positioning Centuria as Australia’s
fourth largest external property funds manager. CNI and CIP
are included in the S&P/ASX 200 Index. COF is included in
the S&P/ASX 300 Index. CIP and COF are part of the FTSE
EPRA Nareit Global Index.
Jason has a hands-on approach to the real estate
operations throughout the Group’s platform. The
Transactions, Development, Funds Management,
Distribution, Marketing and Asset Management teams all
report directly to him.
Jason is a Property Funds Association (PFA) of Australia
Past President. The PFA is the peak industry body
representing the $125 billion direct property investment
industry. Jason currently sits on the Property Council of
Australia’s Global Investment Committee.
Directorship of other listed companies
None
• Member of the Centuria Property Funds Limited Board
Responsibilities
• Member of the Centuria Property Funds Limited Audit,
• Joint Chief Executive Officer
Risk and Compliance Committee
• Member of the Centuria Capital Limited and Centuria
• Member of the Centuria Property Funds No. 2 Limited
Funds Management Limited Boards
Board
• Chairman of the Centuria Property Funds No. 2 Limited
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Culture and ESG Committee
Audit, Risk and Compliance Committee
• Member of the Centuria Life Limited Board
Interests in CNI
• Member of the Centuria Healthcare Pty Ltd Board
Ordinary stapled securities: 1,506,182
Interests in CNI
Ordinary stapled securities: 6,446,081
Performance Rights granted: 2,628,925
Centuria Capital Group – Annual Report 2023 | 65
Directors' report
Directors' report
Mr John E. McBain, Dip. Urban Valuation
EXECUTIVE DIRECTOR AND JOINT CHIEF EXECUTIVE OFFICER
Mr John R. Slater, Dip.FS (FP), F Fin.
INDEPENDENT NON-EXECUTIVE DIRECTOR
Ms Susan L. Wheeldon, MBA
INDEPENDENT NON-EXECUTIVE DIRECTOR
Experience and expertise
Experience and expertise
Experience and expertise
Directorship of other listed companies
Joint CEO John McBain’s 40-year real estate career
spans the commercial and industrial markets in Australia,
NZ and UK and the healthcare and agriculture sectors.
He graduated from Auckland University with a valuation
qualification.
John was appointed as a financial adviser to Centuria Life
Limited in 2011 and as a member of its Board in 2013. On
22 May 2013, he was appointed as a Director of Centuria
Capital Limited. He also serves on the Nomination and
Remuneration Committee
John was previously a senior executive at KPMG Financial
Services prior to establishing a financial advisory
practice. Since the sale of that practice, he has focused
on consulting activities and his non-executive roles with
Centuria.
John has deep experience in all financial market sectors
gained during his 35-year career. Over this time, he has
been directly involved with investments and investment
committees and sits on the Investment Committees of
Centuria Life and the Over Fifty Guardian Friendly Society
Limited. John continues to be active in investment
committee activities in other non-aligned financial groups.
Directorship of other listed companies
None
Responsibilities
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Boards
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Audit, Risk and Compliance
Committee
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Nomination and
Remuneration Committee
• Member of the Centuria Life Limited Board
• Chair of the Centuria Life Limited Investment Committee
Interests in CNI
Ordinary stapled securities: 3,110,677
He is an Executive Director of Centuria Capital Limited,
Centuria Life Limited, Centuria Healthcare Pty Ltd and
Centuria Property Funds No. 3 Limited (formerly Primewest
Management Limited) and a Non-Executive Director of
Centuria Bass Credit Limited. John is a Director of NZX-
listed Asset Plus Limited (NZX:APL). He also serves on
the Centuria NZ and Centuria Healthcare Management
committees and the Centuria Life Investment Committee.
John is responsible for Centuria’s corporate team, and
his responsibilities include corporate strategy, M&A and
leadership of the Finance, Governance, Compliance,
Investor Relations, Communications and Centuria Life
teams. He serves on the Non-Financial Risk Committee
and the ESG Management Committee.
John has been instrumental in the integration of several
businesses into the Centuria group, including the 360
Capital Group, Heathley Asset Management (now Centuria
Healthcare), Augusta Capital Limited (now Centuria
NZ) and the Primewest Group. These acquisitions,
together with a successful asset acquisition and funds
management program overseen by fellow Joint CEO Jason
Huljich, has seen the pair oversee significant corporate
growth over the past 27 years culminating in Centuria
Capital Limited entering the S&P ASX 200 Index in 2021
with the group now managing over $21 billion of assets.
Directorship of other listed companies
Asset Plus Limited (NZX:APL)
Responsibilities
• Joint Chief Executive Officer
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Boards
• Member of the Centuria Life Limited Board
• Member of the Centuria Life Limited Investment
Committee
• Member of the Centuria Healthcare Pty Ltd Board
Interests in CNI
Ordinary stapled securities: 7,888,282
Performance Rights granted: 2,628,925
None
Responsibilities
• Member of the Centuria Capital Limited and Centuria
Funds Management Limited Boards
• Chair of the Centuria Capital Limited and Centuria Funds
Management Limited Nomination and Remuneration
Committee
• Chair of the Centuria Capital Limited and Centuria Funds
Management Limited Culture and ESG Committee
Interests in CNI
Ordinary stapled securities: Nil
Susan joined the Centuria Capital Group Board as an
Independent Non-Executive Director in August 2016.
She brings extensive experience across international
commercial markets within ICT, real estate, legal, aviation
and online retail sectors.
Currently, Susan is Airbnb’s Country Director for Australia,
New Zealand and Oceania. Previously, she served
in a number of roles, including Head of Government,
Performance and Agency at Google, working with major
national and global companies.
During her career, Susan has held senior positions in
Australia and the United Kingdom across a diverse range
of industries including global law firms DLA Piper and King
& Wood Mallesons, working with the Virgin Australia and
Virgin Atlantic airline brands, as Vice President of Groupon,
and as Head of Brand and Retail at AMP Capital Shopping
Centres.
She holds an MBA from University of NSW's Australian
Graduate School of Management, and is a member of
Australian Institute of Company Directors as well as
holding a Corporate Director's Certificate from Harvard
Business School.
Directors' meetings
The following table sets out the number of Directors' meetings (including meetings of committees of Directors) held during
the financial year and the number of meetings attended by each Director (while they were a Director or Committee member).
Director
Board meetings
Mr Garry S. Charny
Ms Kristie R. Brown
Mr Peter J. Done
Mr Jason C. Huljich
Mr John E. McBain
Mr John R. Slater
A
20
20
20
20
20
20
Ms Susan L. Wheeldon 20
B
20
20
18
20
20
19
17
Audit, Risk and
Compliance
Committee
meetings
Nomination and
Remuneration
Committee
meetings
Conflicts Committee
meetings
Culture and
ESG Committee
meetings
A
#
6
6
#
#
6
#
B
#
6
6
#
#
6
#
A
3
#
3
#
#
3
3
B
3
#
2
#
#
3
3
A
8
8
#
#
#
#
#
B
6
8
#
#
#
#
#
A
4
#
#
4
#
#
4
B
4
#
#
4
#
#
4
A = Number of meetings held during the time the Director held office during the year.
B = Number of meetings attended.
# = Not a member of Committee.
66 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 67
Directors' report
Company secretary
Anna Kovarik joined Centuria as General Counsel and
Company Secretary in 2018 and was promoted to Group
Chief Risk Officer and Company Secretary in 2020. She is
an experienced governance professional having worked
with ASX-listed and unlisted boards, predominantly within
the listed property and financial services sectors. In her
current role at Centuria, Anna is responsible for legal,
risk management, regulatory compliance, insurance and
governance activities across the Group.
Anna is a member of the Senior Executive Committee, the
Non-Financial Risk Committee and the ESG Management
Committee. She holds an Executive MBA from the
University of Sydney and is a member of the Australian
Institute of Company Directors.
Principal activities
The principal activities of the Group during the financial
year were the marketing and management of investment
products including direct interest in property funds,
friendly society investment bonds, property and
development finance and other investments across
Australasia.
Significant changes in the state of affairs
Significant changes in the state of affairs of the Group
during the financial year were as follows:
• On 6 April 2023, the Group entered into a 5 year
$50,000,000 secured loan note facility. The facility is
a floating rate revolving facility with a margin of 2.60%
which is due to mature on 6 April 2028.
• On 21 April 2023, the Group fully redeemed a total of
$66,650,000 secured wholesale floating rate notes
maturing on 21 April 2023 and 21 April 2024.
• On 14 June 2023, the Group settled on the sale of 4
Healthcare properties for NZ$34,134,000 and fully repaid
the New Zealand Asset Facility.
• During the year, the Group drew $46,650,000 from the
Revolver A facility, which was subsequently repaid on 23
June 2023.
Operating and financial review
The Group recorded a consolidated statutory net profit
for the year of $105,932,000 (2022: loss of $37,361,000).
Statutory net profit/(loss) after tax has been prepared in
accordance with the Corporations Act 2001 and Australian
Accounting Standards, which comply with International
Financial Reporting Standards.
The Group recorded an operating profit after tax of
$115,588,000 (2022: $114,510,000). Operating profit after
tax excludes non-operating items such as transaction
costs, mark to market movements and share of net profit
of equity accounted investments in excess of distributions
received.
The statutory NPAT includes a number of items that are not considered operating in nature, the table below provides a
reconciliation from statutory profit to operating profit.
Reconciliation of statutory profit to operating profit
Statutory profit/(loss) after tax
Statutory earnings/(loss) per security (EPS) (cents)
LESS NON-OPERATING ITEMS
Share of equity accounted net loss in excess of distributions received
Transaction and other costs
Unrealised (gain)/loss on mark to market movements of investments and derivatives
Eliminations between the operating and non-operating segment
Seed capital write back
Profit attributable to controlled property funds
Tax impact of above non-operating adjustments
Operating profit after tax
Operating EPS (cents)
30 June 2023
$'000
30 June 2022
$'000
105,932
13.3
(37,361)
(4.8)
6,180
3,861
296
-
-
(24)
(657)
115,588
14.5
3,083
4,395
167,087
4,710
(750)
(13,861)
(12,793)
114,510
14.5
Directors' report
A summary of the Group's operating segments is provided in Note A5 of the Financial Report. The Operating NPAT for
the Group comprises the result of the divisions which report to the Joint CEOs and Board of Directors for the purpose of
resource allocation and assessment of performance.
Segment
Property funds management
Co-investments
Developments
Property and development finance
Investment bonds management
Corporate
Operating profit after tax
Operating profit after tax $'000
2023
79,225
17,233
6,613
4,606
2,424
5,487
115,588
2022
78,785
28,863
4,526
2,912
3,412
(3,988)
114,510
Increase/
(Decrease) $'000
Increase/
(Decrease) %
Highlights
440
(11,630)
2,087
1,694
(988)
9,475
1
(40)
46
58
(29)
(a)
(b)
(c)
(d)
(e)
A detailed Segment Profit and Loss as well as a detailed Segment Balance Sheet is outlined in Notes B1 and C1 respectively.
Operational highlights for the key segments were as follows:
(a) Property funds management
For the year ended 30 June 2023, property funds
management operating NPAT of $79,225,000 was higher
than the prior year ending 30 June 2022 by $440,000
primarily due to the impact of the favourable property
valuations as well as full year impact of acquisitions.
(c) Developments
For the year ended 30 June 2023, the Developments
segment operating net profit after tax was $6,613,000,
an increase of $2,087,000 from the year ended 30 June
2022. The increase is primarily due to the recognition of
development profit on the Wyatt Street development.
For the year ended 30 June 2023, excluding the after
tax impact of performance fees, the property funds
management segment NPAT increased by $3,585,000 or
6% reflecting the growth in AUM from acquisitions and
favourable valuation impact.
(b) Co-investments
For the year ended 30 June 2023, the co-investments
segment operating NPAT decreased by $11,630,000. This
was primarily due to the increase in interest rates during
the period, offset by the full year impact of rental income
from the Heritage Lifecare Centres.
The operating profit after tax for the co-investments
segment represents the distributions and returns
generated from investment stakes held less applicable
financing costs.
(d) Property and development finance
For the year ended 30 June 2023, the property and
development finance segment's operating NPAT was
$4,606,000. The Centuria Bass operating NPAT has
increased by 58% compared to FY22 due to AUM
increasing from $0.6 billion to $1.3 billion.
Centuria Bass is considered a joint venture and treated as
an equity accounted investment commencing from 22 April
2021. The operating results of Centuria Bass are shown in
Note B1 as the Group's proportionate share.
(e) Investment bonds management
For the year ended 30 June 2023, the investment bonds
management segment's operating NPAT decreased by
$988,000 primarily due to the one-off fees received
in the prior year when the Capital Guaranteed product
transitioned into unitised products.
Outlook
The Group remains focused on sourcing quality real estate investment opportunities, utilising the Group's deep real estate
expertise and leveraging the platform to create value for our investors. The REIT management revenues, joint venture
interests, institutional partnerships, and real estate credit business, combine to create a strong diverse and recurring
revenue base.
Earnings per security (EPS)
Basic EPS (cents/security)
Diluted EPS (cents/security)
1. As the Group was in a statutory loss, the Diluted EPS is equal to Basic EPS.
2023
2022
Operating
Statutory
Operating
Statutory1
14.5
14.3
13.3
13.1
14.5
14.3
(4.8)
(4.8)
68 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 69
Directors' report
Dividends and distributions
Dividends and distributions paid or declared by the Group during the current financial year were:
A copy of the auditor's independence declaration as
required under section 307C of the Corporations Act 2001
is set out on page 98.
Cents per security
Total amount
$'000
Date paid
Rounding of amounts
Directors' report
The Group is an entity of a kind referred to in ASIC
Legislative Instrument 2016/191, related to the ‘rounding
off’ of amounts in the Directors’ Report and financial
statements. Amounts in the Directors’ Report and financial
statements have been rounded off, in accordance with
the instrument to the nearest thousand dollars, unless
otherwise indicated.
DIVIDENDS/DISTRIBUTIONS PAID DURING THE YEAR
Final 2022 dividend (100% franked)
Final 2022 Trust distribution
Interim 2023 dividend (100% franked)
Interim 2023 Trust distribution
DIVIDENDS/DISTRIBUTIONS DECLARED DURING THE YEAR
Final 2023 dividend (100% franked)
Final 2023 Trust distribution
Events subsequent to the reporting date
There has not arisen in the interval between 30 June
2023 and the date hereof any item, transaction or event
of a material and unusual nature likely, in the opinion of
the directors of the Company, to affect significantly the
operations of the Group, the results of those operations, or
the state of affairs of the Group, in future financial periods.
Likely developments
The Group continues to pursue its strategy of focusing on
its core operations, utilising a strengthened balance sheet
to provide support to grow and develop these operations.
Further information about likely developments in the
operations of the Group and the expected results of those
operations in future financial years has not been included
in this report because disclosure of the information would
be likely to result in unreasonable prejudice to the Group.
Environmental regulation
The Group has policies and procedures to identify and
appropriately address environmental obligations that might
arise in respect of the Group's operations that are subject
to significant environmental laws and regulation. The
Directors have determined that the Group has complied
with those obligations during the financial year and that
there has not been any material breach.
0.90
4.60
1.20
4.60
0.50
5.30
7,114
36,363
9,557
36,634
11 August 2022
11 August 2022
9 February 2023
9 February 2023
3,999
42,389
18 August 2023
18 August 2023
The directors have not included details of the nature of
the liabilities covered or the amount of premium paid in
respect of the directors' and officers' liability and legal
expenses insurance contracts, as such disclosure is
prohibited under the terms of the contracts. The Company
has not otherwise, during or since the end of the financial
year, except to the extent permitted by law, indemnified or
agreed to indemnify an officer or auditor of the Company or
any related body corporate against a liability incurred as an
officer or auditor.
Non-audit services
During the financial year, KPMG, the Group’s auditor, has
performed services in addition to the audit and review
of the financial statements. Details of amounts paid or
payable to KPMG are outlined in Note F3 to the financial
statements.
The directors are satisfied that the provision of non-audit
services during the year, by the auditor (or by another
person or firm on the auditor's behalf) is compatible
with the general standard of independence for auditors
imposed by the Corporations Act 2001.
The directors are of the opinion that the services as
disclosed in the financial statements do not compromise
the external auditor's independence, based on advice
received from the Audit, Risk and Compliance Committee,
for the following reasons:
Indemnification of officers and auditor
• All non-audit services have been reviewed and approved
The Company has agreed to indemnify all current and
former directors and executive officers of the Company
and its controlled entities against all liabilities to persons
(other than the Company or a related body corporate)
which arise out of the performance of their normal duties
as a director or executive officer unless the liability relates
to conduct involving a lack of good faith.
The Company has agreed to indemnify the directors and
executive officers against all costs and expenses incurred
in defending an action that falls within the scope of the
indemnity and any resulting payments.
70 | Centuria Capital Group – Annual Report 2023
to ensure that they do not impact the integrity and
objectivity of the auditor.
• None of the services undermine the general principles
relating to auditor independence as set out in the Code
of Conduct APES 110 Code of Ethics for Professional
Accountants issued by the Accounting Professional and
Ethical Standards Board, including reviewing or auditing
the auditor's own work, acting in a management or
decision-making capacity for the Company, acting as
advocate for the Company or jointly sharing economic
risks and rewards.
Centuria Capital Group – Annual Report 2023 | 71
Directors' report
Directors' report
Nomination and Remuneration Committee Chair's letter
considered a leading Australasian funds manager. Whilst the
overall weighing of STI hurdles remain consistent with prior
years, comprising 60% financial and 40% non-financial
metrics, an additional component has been added to the
STI plan structure. The financial hurdles which continue to
comprise of targets relating to operating earnings, assets
under management (AUM) and equity sources, are now
complemented with the proposed introduction of a cost
management hurdle, incentivising management to protect
the short-term operating margins of the Group. The Board
believes this additional financial metric to be an important
enhancement to our short-term financial performance
hurdles, given the immediate need of business to respond
to challenging economic and market conditions. Likewise
an expanded range of non-financial metrics have also
been introduced, addressing diversity, governance and
tenant satisfaction targets, all of which are considered
important pillars in ensuring future strategic success for the
Group. More details of this can be found on page 84 of the
Remuneration Report.
In terms of long-term incentives (LTI), the Board has
retained a combination of relative and absolute total
securityholder return (TSR) hurdles assessed against
A-REIT peers in the S&P/ASX200. Despite volatile
market conditions which are beyond the direct control
of management, the Board believes that these continue
to serve as the most appropriate performance hurdles,
since they align executives’ interests with securityholder
outcomes as well as ensuring direct comparability to our
peers. Consistent with prior years, the LTI proposed for
the FY24–27 period will continue to vest over year’s three
and four.
Non-Executive Director (NED) remuneration
The current NED fee structure was retained for FY23. The
fee structure covers the Board and Board Committee
roles across the Group (including CNI and other operating
entities) and was adopted to improve the transparency of
fees paid to directors across what is a complex group with
ever-increasing governance standards. Further, the fee
schedule has been benchmarked against A-REIT peers
in the S&P/ASX200 to align director remuneration with
market practice as well as recognising the significant
responsibilities each director has in the various Boards
and Board Committees they sit on across the Group. More
details of the fee structure can be found on page 94 of the
Remuneration Report.
As we continue our drive for Board renewal, the fees have
been designed to be comparable to our peers in order to
attract the highest quality talent to the Board. Expanding
the breadth and depth of Board membership across the
Group continues to be a key priority of the current Board
and will underpin our drive towards optimal independence
and diversity in all its forms.
To best explain the breakdown of duties and fees, as
outlined on page 94 of the Remuneration Report, the
amounts paid to each Centuria Capital Limited NED have
Susan Wheeldon
INDEPENDENT NON-EXECUTIVE
DIRECTOR
Dear Investor,
As chair of the Nomination and Remuneration Committee,
I am pleased to present the Remuneration Report for the
year ended 30 June 2023. This report has been approved
by the Board and is intended to be informative as possible
whilst complying with our statutory reporting obligations.
Each year, the Board reviews the Group’s executive
remuneration practices to ensure they remain
appropriately aligned to our short-term and long-term
strategic objectives and are appropriately tested and
considered against market practices. This ensures
the business attracts, retains and motivates strong
executives with a focus on both growth and appropriate
risk management. Our remuneration philosophy remains
consistent with prior years, aiming to fairly reward and
retain the people who we believe play a crucial role in
the achievement of our long-term objectives and are key
to our competitive advantage as a leading Australasian
funds manager in the S&P/ASX200 index. Whilst our
philosophy remains unchanged, our remuneration
structure for the current year has been enhanced with
additional short-term performance targets to ensure
they remain appropriate and relevant in response to the
changing needs of the business. These additional short-
term performance hurdles and targets were introduced
to ensure our executives are appropriately incentivised
to respond to new and upcoming market challenges and
continue to drive Group performance.
The key elements of the FY23 executive remuneration
structure, which the Board believe are fit for purpose
and support our primary objective of driving long-term
performance for our securityholders are outlined below, with
full details tabled on page 87 of the Remuneration Report.
Executive remuneration
In response to changing market conditions, the proposed
FY23 performance hurdles for executives’ variable
awards have been modified with additional short term
performance hurdles to rebalance the business away
from short term growth to delivering earnings stability,
platform resilience as well as asset sector diversification.
The short-term incentive (STI) hurdles have been set
to ensure the awards are not only demonstrably tied to
financial performance, but also ensure an ongoing focus on
imperative business and operational issues that will drive
long-term securityholder value and create a business that is
72 | Centuria Capital Group – Annual Report 2023
been separated across the various boards and board
committees which they serve on. These disclosures
further enhance the transparency and link between
the benchmarked schedule of fees and the aggregate
remuneration paid to each NED.
FY23 performance and remuneration outcomes
In response to changing market conditions, management
has for the current year rebalanced its focus away
from short term growth to delivering earnings stability
and platform resilience as well as continued asset
diversification. I am pleased to report that the business
delivered on all three counts, reporting an operating EPS of
14.5 cents in line with guidance, growing its AUM to $21.0
billion and delivering additional diversification through
its continued expansion into real estate debt and the
Agriculture sectors.
It is important to note that this result exceeded the
Group’s record FY22 profitability in spite of volatile market
conditions.
The robust FY23 performance is testament to the long-
standing focus of the business on growing and diversifying
assets under management across various sectors and
markets. This has enabled the business to develop a
stable and diverse operating platform able to withstand
market fluctuations and ensure sustainable earnings for
our securityholders. It is pleasing to note the continued
diversification of the platform into agriculture and real
estate debt during the year, with the business further
solidifying its recurring sources of revenue, acquiring in
excess of $300 million of AUM in these new asset sectors
during the year.
The Nomination and Remuneration Committee has also
assessed the annual performance of senior management
against the FY23 STI objectives. It has been pleasing to
note the way senior management and the business have
responded to the various challenges by satisfactorily
meeting or exceeding the majority of their financial
performance hurdles, including the implementation of
new cost management initiatives. Notwithstanding these
achievements, STI outcomes for the KMPs were 88% of
FY22 award for the Joint CEOs and 90% of FY22 STI award
for the CFO. Whilst the continued AUM growth across new
sectors has been pleasing, challenging market conditions
have meant that the overall growth in the current year
did not meet the outperformance targets set at the
commencement of the year, resulting in the forfeiture of
the balance of the maximum FY23 STIs noted above.
Further details of the specific targets and the
overperformance achieved by senior executives against
each hurdle, including the rationale for the adoption of
each of the financial performance metrics have been set
out on page 85 of the Remuneration Report.
Whilst traditional financial measures in assessing the
performance of our senior executive team remains the
cornerstone of Centuria, our strategy of growth and
diversification requires an increasing focus on non-
financial metrics. The integration of recently acquired
platforms, including the Centuria Bass Capital business
and our internal property management strategy have
elevated the importance of non-financial metrics such
as staff and tenant engagement, non-financial risk
management as well as our sustainability credentials. I am
proud to observe the Group’s enduring commitment to
improving its environmental and social contribution across
our operations, which are now considered to be a key
driver for our future business success.
The performance of our KMP against these non-
financial metrics have been outlined on page 86 of the
Remuneration Report, with the team exceeding targets
across all three metrics, resulting in the award of 125% of
the non-financial component of the FY23 STI.
As part of the annual review, the Board discussed various
elements of the KMP remuneration to determine their
appropriateness for Centuria in 2023. As such, the Group
has also adopted a new significant securityholder test
for the KMPs, wherein a portion of the financial year
STI will be deferred should minimum security holding
requirements not be met. This additional limb in the STI
Performance Structure for KMPs was introduced following
a review of the market best practice and determined
that a significant securityholder test appropriately aligns
KMPs with the business whilst continuing to reward
performance outcomes.
With the LTI remaining a key remuneration component to
align the long-term interests of Centuria’s investors with
its senior executives, it is important to note the negative
impact the declining global equity markets have had on
Tranche 8 of LTIs, covering the 1 July 2020 to 30 June
2023 performance period. For FY23, Centuria’s one-year
TSR was -2.5% with the three-year TSR being 7.3%. This
has resulted in full forfeiture of the TSR component of the
Tranche 8 LTI awards vested.
Whilst it is difficult to imagine a combination of short-term
strategies within senior management’s control which
could have avoided or produced a different TSR outcome,
it is important to note the continued growth in AUM from
$8.8 billion in FY20 to $21.0 billion by the end of FY23.
With the three-year Relative TSR and Absolute TRS not
meeting entry hurdle requirements, Tranche 8 LTI awards
have not vested.
The Board continues to place a high priority on having
meaningful dialogue with our securityholders and other
stakeholders regarding our remuneration policies, in order
to understand their perspectives and concerns, as well as
to remain abreast of local and global market best practices.
We appreciate your ongoing support and we look forward
to engaging with you again in FY24.
Yours sincerely,
Susan L. Wheeldon, Chair of the Nomination and
Remuneration Committee
Centuria Capital Group – Annual Report 2023 | 73
Directors' report
Audited Remuneration Report
The Board are pleased to present the Remuneration
Report for the period ended 30 June 2023.
The report is structured as follows:
• Details of KMP covered in this report;
This Remuneration Report has been prepared in
accordance with section 300A of the Corporations
Act 2001 (Cth) (Act) and the applicable Corporations
Regulations 2001 (Cth). The Remuneration Report provides
information about the remuneration arrangements for
key management personnel (KMP), which includes Non-
Executive Directors and the Group’s Senior Management
for the year ended 30 June 2023.
• Remuneration oversight and key principles;
• Remuneration of Executive Directors and Senior
Management;
• Key terms of employment contracts;
• Non-Executive Director remuneration; and
• Director and Senior Management equity holdings and
other transactions.
Details of KMP covered in this report
The following persons had authority and responsibility for planning, directing and controlling the activities of the Group,
directly or indirectly, including any Director (whether executive or otherwise) of the Company during the full financial year.
Name
Non-Executive Directors
Mr Garry S. Charny
Ms Kristie R. Brown
Mr Peter J. Done
Mr John R. Slater
Role
Independent Non-Executive Director and Chairman
Independent Non-Executive Director
Independent Non-Executive Director
Independent Non-Executive Director
Ms Susan L. Wheeldon
Independent Non-Executive Director
Executive Directors
Mr John E. McBain
Mr Jason C. Huljich
Executives
Mr Simon W. Holt
Executive Director and Joint Chief Executive Officer
Executive Director and Joint Chief Executive Officer
Chief Financial Officer
Term
Full term
Full term
Full term
Full term
Full term
Full term
Full term
Full term
The term 'Senior Management' is used in this Remuneration Report to refer to the Executive Directors and the Chief
Financial Officer.
Nomination and Remuneration Committee
(NRC)
The Board has an established Nomination and
Remuneration Committee which operates under the
delegated authority of the Board of Directors. A summary
of the Nomination and Remuneration Committee Charter is
included on the Centuria Capital Group website.
The functions of the Committee in respect of remuneration
include:
• making recommendations to the Board regarding the
remuneration of non-executive members of Centuria’s
Board, subsidiary boards and committees which shall be
reviewed annually;
Additionally, the function of the Committee in respect
of Board, Joint CEOs and Senior Executive performance
include:
• evaluating the performance of the Board, including
Committees and individual Directors;
• assessing the performance of the Joint CEOs and Senior
Executives against their key performance indicators; and
• ensuring other human resource management programs,
including fit for purpose performance assessment
programs.
The following Non-Executive Directors of Centuria are
members of the Nomination and Remuneration Committee
• Ms Susan L. Wheeldon (Non-Executive Director and
• an annual review of the KMP remuneration and the
Committee Chair);
application of incentive programs; and
• Mr Garry S. Charny (Non-Executive Director, Chairman of
• an annual review of the structure and application of
Centuria Capital Limited);
the short-term and long-term incentive schemes and
policies for executives and staff.
• Mr John R. Slater (Non-Executive Director); and
• Mr Peter J. Done (Non-Executive Director).
The Committee is tasked by the Board to advise it in relation
to remuneration outcomes and it may obtain external
professional advice, and secure the attendance of advisors
with relevant experience if it considers this necessary.
Directors' report
Remuneration policy and link to performance
• Centuria Bass Credit real estate finance business;
Group structure
Centuria Capital Group is an ASX-listed specialist
investment manager with a 27-year track-record of
delivering a range of products and services to investors,
advisers and securityholders. Our business now spans
across property funds management, development,
real estate finance in addition to co-investments and
investment bonds, with the following key areas of focus:
• Centuria Property Funds which specialises in listed
property funds (A-REITs) and unlisted property funds
including:
– listed REITs, Centuria Office Fund (ASX:COF) and
Centuria Industrial Fund (ASX:CIP) in Australia;
– listed property fund in New Zealand, Asset Plus
Limited (NZX:APL);
– Centuria Agriculture Fund;
– Centuria Diversified Property Fund;
– Centuria Healthcare Property Fund;
– Centuria New Zealand Industrial Fund;
– 120 closed-end unlisted property funds in Australia
and New Zealand; and
• Centuria Healthcare property and funds management
business;
• Centuria LifeGoals Investment Bonds.
The Group encompasses a portfolio of wholesale and retail
funds, a healthcare business with related wholesale and
retail funds, and a New Zealand business with listed and
unlisted funds. It is noted that the listed REITs also are not
staffed and responsibility for these are managed by the
executive team and employees of CNI. The Group structure
is outlined below.
The combined market capitalisation of the listed
headstock (Centuria Capital Group) and its three listed
REITS comprising CIP, COF and APL, is approximately $4.2
billion.
Given the overall size of the Group, the complexities of
the business it operates and its international scope, the
Board has adopted a number of remuneration practices
that reflect this. These are represented in our Joint CEO
structure as well as the new Directors’ fees schedule,
which are discussed further in pages 92 and 94 of this
report, respectively.
The below group structure only outlines the key operating
and management entities of the Centuria Capital Group
(note: this is not a full list of controlled entities and
associates).
Centuria Capital Limited
Centuria
Life Limited
Manager for:
• 40 investment funds
• Administrator of the
Centuria Property
Funds Limited
Responsible entity for:
• Centuria Office REIT (ASX:COF)
• Centuria Diversified
Guardian Friendly Society
Property Fund
• Centuria Agriculture Fund
• 14 registered managed
investment schemes
Centuria Property
Funds No.2 Limited
(CPF2L)
Responsible entity for:
• Centuria Industrial REIT
(ASX:CIP)
• Centuria Healthcare
Property Fund
• 6 registered managed
investment schemes
Centuria Funds
Management
Limited (CFML)
Responsible entity for:
• Centuria Capital Fund
• Trustee of Centuria Capital
No. 2 Fund (ASX:C2F)
Centuria Property
Services Pty
Limited
Centuria Platform
Investments Pty
Limited
Centuria
Developments
Pty Limited
Development pipeline of $1.6bn
60%
Centuria
Healthcare Pty
Limited
Centuria Capital
(NZ) Limited
50%
Centuria Bass
Credit Pty Limited
Real estate credit supplier
Centuria Property
Funds No.3 Limited
(CPF3L)
Responsible entity for:
• 43 unlisted schemes
Centuria
Healthcare Asset
Management
Limited
Responsible entity for:
• 4 unlisted registered
managed investment
schemes
Co-investment
stakes
including:
• 10% Centuria NZ Industrial Fund
• 19.9% Asset Plus Limited
• 25.78% Centuria NZ Property
Fund
(Held directly or indirectly through
interposed entities).
Centuria Funds
Management (NZ)
Limited
Manager for:
• Asset Plus Limited (NZX:APL)
• 41 unlisted schemes
Centuria Property
Funds No.4 Limited
(CPF4L)
Responsible entity for:
• 31 unlisted schemes
CFML AREF
Centuria Capital
Fund
Centuria Capital
No.2 Fund
Co-investment
stakes
including:
• 15.25%
Centuria Office REIT (ASX:COF)
• 15.92%
Centuria Industrial REIT
(ASX:CIP)
• 21.54%
Centuria Diversified Property
Fund
• 21.59%
Centuria Government Income
Property Fund No.2
• 12.0%
Centuria Healthcare Direct
Medical Fund No.2
(Held directly or indirectly through
interposed and related entities).
Legend
Stapled entities
Wholly owned entities
Partially owned entities
Other interposed entities
74 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 75
Directors' report
Directors' report
Joint CEO structure
The Joint CEO structure was established in 2019 as an
important part of the Group’s long-term management
succession and retention plan. In support of the Joint
CEO structure the Board takes into account the following
matters:
• The Joint CEOs have a strong background in all aspects
of the business and also have complementary skills
sets, which given the Group’s overall structure allows
them to focus on different areas in managing the
multiple complexities of the business. Mr Huljich has
primary oversight of funds management, distribution and
property services and Mr McBain has primary oversight
of corporate functions (corporate strategy, M&A, finance,
treasury, risk and governance, communications and
investor relations) and the Life business.
• The Board recognises the significant importance that a
strong succession plan has on any business. The Joint
CEOs have worked seamlessly together for 27 years.
By creating the Joint CEO role for Mr Huljich in 2019,
the Board formally recognised Mr Huljich’s historic and
continuing contribution to the Group over an extended
period. With Joint CEOs, the business has two strong
leaders, collaborating to optimise investor value in a tried
and tested way.
The remuneration of the Joint CEOs reflects the position
they hold in the real estate funds management industry
and their experience and achievements gained from
working together since the formation of Centuria. Given
the complementary skill sets of the Joint CEOs and their
division of key responsibilities (outlined above), the Board
believes the remuneration of the Joint CEOs is a benefit for
investors by removing the need for expensive secondary
key executive resources which many other A-REIT peers
require, such as Chief Investment Officers and/or Chief
Operations Officers.
Through the Joint CEO structure, the Group is able to
minimise the size of the senior executive to be leaner, less
costly and nimbler than its peers. The Board believes this
is a significant competitive advantage and in the long-term
interests of securityholders. As part of its benchmarking
process, the Board believes the reduced senior executive
team size in association with the Joint CEO structure
is a significant cost-saving practice for the Group in
comparison to its peers.
The Nomination and Remuneration Committee, as well as
the Board, annually review the appropriateness of the Joint
CEO structure to ensure its efficiency and effectiveness by
assessing the individual and the joint performance of the
CEOs in delivering strong securityholder outcomes within
the context of the Group’s continued growth compared to
A-REIT peers’ performance and total executive team costs.
The FY23 fixed remuneration amount for the Joint CEOs
was $1,552,500, which remained unchanged from FY22.
The Committee recommended an unchanged fixed
remuneration for FY23 despite:
• The Joint CEOs’ strong execution of the Group’s growth
strategy and continued strong financial performance
under their leadership during FY22, including a
substantial 98% growth in AUM over FY21 and inclusion
in the S&P/ASX 200 Index)
• The Joint CEOs’ response to the COVID-19 pandemic,
where they voluntarily took a six month - 15% reduction
to their fixed remuneration and displayed outstanding
performance in positioning the Group to rebound quickly
from the initial impact of the pandemic.
Remuneration of Senior Management
Remuneration philosophy
The Group recognises the important role people play in
the achievement of its business strategy and long-term
objectives and as a key source of competitive advantage.
To grow and be successful across these two areas, the
Group must be able to attract, motivate and retain capable
individuals with exceptional talent, expertise, experience
and relationships. Our Group is able to achieve this goal by
following our remuneration principles outlined in the table
below.
The main objective in rewarding the Group’s senior
management for their performances is to ensure
that securityholders’ wealth is both maximised and
appropriately protected throughout a range of economic
conditions.
Remuneration structure
The table on page 77 outlines the Group’s remuneration
principles, the components of Senior Management’s
remuneration and the underpinning rationale for each
element of the remuneration structure. The Nomination
and Remuneration Committee ensures the criteria used
to assess and reward staff includes financial and non-
financial measures of performance.
Our remuneration principles
Delivering value for securityholders in the
most efficient manner
The Joint CEO structure optimises the
size of the senior executive group in
relation to its peers to make it leaner
and more agile than our peers.
Drive an ownership mentality
Attract, motivate and retain talent
Including senior staff in the LTI equity
plan to provide a sense of ownership
and alignment, as well as distributing
securities to all non-LTI staff depending
on Group performance.
Ensuring competitive, at-risk rewards
are provided to attract and retain the
best executive talent.
Total executive remuneration
Fixed
At-risk
Type of remuneration
Fixed remuneration
Short-term incentive
Long-term incentive
What is the objective?
• Attract and retain key
talent
• Be competitive
How is it set?
Fixed remuneration is set
with reference to market
competitive rates in
comparison to ASX-listed
A-REITs for similar positions,
adjusted to account for
the experience, ability and
productivity of the individual
employee.
How is it delivered?
• Base salary
Opportunity
• Superannuation
• Other benefits salary
sacrifice benefits
Independent Non-Executive
Director
• Drive annual financial
growth targets and
securityholder returns
• Reward value creation over
a one-year period whilst
supporting the long-term
strategy
• Incentivise desired
behaviours in line with the
Group’s risk appetite
• Mandatory significant
ownership in the Group’s
securities within the KMP
group
Senior executives participate
in the Group’s STI plan
which is assessed against
key areas of financial and
non-financial performance
that are designed to create
an ongoing annual focus
on imperative business
and operational issues that
create the type of Group we
all strive towards. Refer to
the FY23 STI Scorecard for
further details.
Required KMP security
ownership with the
introduction of STI deferral
metrics where security
ownership is not significant.
Awarded in cash or shares at
the Board’s discretion
• Support delivery of the
business strategy and
growth objectives
• Incentivise long-term
value creation
• Drive alignment
of employee and
securityholder interests
Senior executives participate
in the Group’s LTI plan
which is assessed against
securityholder returns over
a three-year performance
period. The significant
weighting towards relative
TSR in the LTI aligns
executive’s interests with
securityholder outcomes and
provides a direct comparison
of the Group’s performance
against their comparator
group of peers.
Refer to the LTI Structure
section for further details.
Equity with performance
assessed over three years
(vesting in years three and
four)
Joint CEOs
Joint CEOs
• 125% of fixed
• 125% of fixed
remuneration at maximum
remuneration at maximum
CFO
CFO
• 100% of fixed
• 95% of fixed remuneration
remuneration at maximum
at maximum
76 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 77
Directors' report
Directors' report
As part of the annual review, the Group has reassessed various elements of its executive remuneration structure to
assess their continued relevance and suitability given the changing needs of the business. This process included a
robust review of market practices which would continue to attract, retain and motivate executives committed to strong
risk management. The key recommendations adopted as a result of this review was the introduction of a new short term
incentive deferral mechanism contingent on a minimum executive share ownership requirement. This was coupled with
the introduction of a new STI clawback arrangement on provisions similar to existing clawback requirements under the LTI
plan. The specific nature of the changes arising from this review as well as an outline of the rationale have been detailed
in the following table:
Executive short term
incentive deferral
conditions
Executive security
ownership
guidelines
2022
None
2023
Rationale
The joint CEOs must hold an
equivalent of 200% of their fixed
remuneration in the form of equity.
The CFO must hold an equivalent of
100% of their fixed remuneration in
the form of equity.
Any new KMP must accumulate and
hold an equivalent of 100% of their
fixed remuneration in the form of
equity within the first five years from
the date of their appointment.
The Board believes that in combination with
other remuneration elements, executive
share ownership requirements minimise
excessive risk taking that might lead to
short-term returns at the expense of long-
term value creation.
In addition, it creates further alignment
between individual executive wealth and the
long-term performance of the company.
As such, the Board determined that share
ownership requirements are appropriate
for Centuria at this stage and will provide
sufficient alignment with securityholders
whilst minimising the potential for excessive
risk taking.
STI deferral
None
Should the executive’s share
ownership fall below the required
limit, the company will defer 25% of
the vested STI in the form of equity
for a period of one year, or longer.
The Board believes that the Joint CEOs are
sufficiently aligned with the securityholders
through their significant ownership in the
Group’s securities (approximately 0.9% of
issued capital each).
In addition, they both participate in the
LTI plan, with an opportunity to receive
additional equity subject to meeting
performance criteria.
The Board has considered the STI deferral
in light of the market best practice and
determined that due to the above reasons,
a formal STI deferral is not appropriate at
the current stage of the Group and structure
of the executive team (provided that their
share ownership meets the required share
ownership threshold).
As such, the STI deferral will only be
triggered in order to meet that criteria.
Clawback
Applied
under LTI
plan only.
The clawback provisions, as
described under LTI plan on page 88,
will also apply to the deferred portion
of the STI.
The Board is of the view that clawback
policies continue to be appropriate for
Centuria at this stage and will minimize the
potential for excessive risk taking.
Delivery of FY23 executive remuneration components
The diagram below outlines the payment/delivery timing of each element of executive remuneration.
When are the key FY23 remuneration components earned and received?
Fixed
remuneration
Cash
Paid throughout the year
Cash
Cash one year performance
period if securityholder
requirements met
STI
n
o
i
t
a
r
e
m
u
n
e
r
k
s
i
r
-
t
A
25% of the vested STI will be deferred if significant security holding
requirements not met
Performance Rights
Performance measured over three years following the grant (75% RTSR, 25% ATSR)
LTI
75% of LTI award vesting in year 3
(subject to performance/service requirements and calculation point for total award at end of year 3)
25% of LTI award vesting in year 4
YEAR 1
YEAR 2
YEAR 3
YEAR 4
Remuneration mix
Remuneration packages include a mix of fixed and variable remuneration and short and long-term performance-based
incentives.
Potential Joint CEO
remuneration mix
(at target opportunities)
Potential Joint CEO
remuneration mix
(at maximum opportunities)
Potential CFO
remuneration mix
(at target opportunities)
Potential CFO
remuneration mix
(at maximum opportunities)
41.7
%
33.3
28.6
35.7
%
25.0
35.7
35.8
37.7
32.2
33.9
%
26.5
%
33.9
Fixed
STI
LTI
78 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 79
Directors' report
Remuneration benchmarking
The Committee believes it is critical to understand the
relevant market for key executive talent in order to ensure
the Group’s remuneration strategy and frameworks
support the guiding principle which is to attract, motivate
and retain capable individuals with exceptional talent,
expertise, experience and relationships.
The Committee regularly reviews the composition of the
benchmarking peer groups to ensure they continue to
represent appropriate reference points for establishing
total remuneration for the Group’s executives. In general,
the Committee considers companies with similarities to
the Group on one or more of the following characteristics:
• Similar industry or comparable lines of business.
• Operate in multiple geographies.
• Similar number of employees.
The Committee reviews benchmarking data for a broad
set of ASX-listed A-REIT peers that exhibit the above
characteristics, however, it considers the following ASX-
listed entities to be the most comparable peers for the
Group and represent our main source of competition for
executive talent:
• Charter Hall Group (ASX: CHC);
• Goodman Group (ASX: GMG);
• Stockland (ASX: SGP);
• Mirvac Group (ASX: MGR);
• Dexus (ASX: DXS);
• GPT Group (ASX: GPT);
• Scentre Group (ASX: SCG); and
• Vicinity Centres (ASX: VCX).
• Similar revenue or AUM ($21.0 billion at 30 June 2023)
with a complex and diverse structure across a range of
unlisted and listed vehicles.
Whilst benchmarking data is used as one input into
remuneration decisions, the Committee also considers
various fundamental factors including:
• Similar market capitalisation on the ASX (using the
• the size and complexity of the role, including
Directors' report
Historical performance, shareholder wealth and remuneration
Financial performance
The Group’s overall objective is to reward executive directors and senior management based on the Group’s performance
and build on securityholders’ wealth but this is subject to market conditions for the year.
The table below sets out summary information about the Group's earnings for the past five years.
Five year summary
30 June
2023
30 June
2022
30 June
2021
30 June
2020
30 June
2019
Operating profit after tax ($'000)
115,588
114,510
70,211
53,253
45,706
Statutory profit after tax attributable to Centuria Capital Group
securityholders ($'000)
105,920
(37,852)
143,456
21,105
50,795
Share price at start of year
Share price at end of year
Interim dividend
Final dividend
Special non-cash dividend
$1.81
$1.65
5.8cps
5.8cps
-
$2.78
$1.81
5.5cps
5.5cps
-
$1.79
$2.78
4.5cps
5.5cps
-
$1.77
$1.79
$1.40
$1.77
4.5cps
4.25cps
5.2cps
5.0cps
-
7.8cps
Statutory basic earnings per Centuria Capital Group security
13.3cps
(4.8)cps
24.6cps
4.7cps
14.2cps
Operating basic earnings per Centuria Capital Group security
14.5cps
14.5cps
12.0cps
12.0cps
12.7cps
combined market capitalisation for CNI, CIP and COF
of approximately $4.2 billion as at 30 June 2023, for
benchmarking purposes).
geographical reach including offshore responsibilities;
Joint CEO STI outcome (% of maximum)
• the criticality of the role to successful execution of the
Joint CEO LTI outcome (% of vesting of grant)
Group’s business strategy;
• skills and experience of the individual;
• period of service;
• scarcity of talent;
• surrounding market conditions and sentiment; and
• the Group’s growth trajectory.
CFO STI outcome (% of maximum)
CFO LTI outcome (% of vesting of grant)
88%
0%
90%
0%
100%
25%
100%
25%
100%
100%
90%
100%
93%
100%
93%
100%
N/A
100%
N/A
100%
80 | Centuria Capital Group – Annual Report 2023
UNLISTED: GUYRA GLASSHOUSE, GUYRA NSW
Centuria Capital Group – Annual Report 2023 | 81
Directors' report
Directors' report
Total securityholder return (TSR)
Following the major acquisition of the Primewest business,
on 16 July 2021, Centuria Capital joined the S&P/ASX200
index ranked #154. This ranking is currently circa #260
taking into account the post-transaction free float market
capitalisation.
Due to the factors set out on page 80 and subject to
the qualification also outlined, the Group considers the
following ASX-listed entities as its most comparable
peers which forms the basis of its remuneration
benchmarking exercises:
• Charter Hall Group (ASX: CHC);
• Goodman Group (ASX: GMG);
• Stockland (ASX: SGP);
• Mirvac Group (ASX: MGR);
• Dexus (ASX: DXS);
• GPT Group (ASX: GPT);
• Scentre Group (ASX: SCG); and
• Vicinity Centres (ASX: VCX).
The graphs and table below highlight Centuria’s
performance against the nominated A-REIT peers, the
broader S&P/ASX200 Index and the S&P 200 A-REIT Index.
3-year total shareholder return (30 Jun 20 to 30 Jun 23) – peers
CNI 7.3%
Peer 48.9%
Peer 46.7%
Peer 41.3%
Peer 39.1%
Peer 20.8%
Peer 20.1%
Peer 17.8%
Peer 0.3%
ASX 200 A-REIT 26.4%
140%
120%
100%
80%
60%
40%
20%
-
(20%)
(40%)
+48.9%
+46.7%
+41.3%
+39.1%
+26.4%
+20.8%
+20.1%
+17.8%
+7.3%
+0.3%
Jun 20
Sep 20
Dec 20
Mar 21
Jun 21
Sep 21
Dec 21
Mar 22
Jun 22
Sep 22
Dec 22
Mar 23
Jun 23
Source: TSR data from IRESS.
Note: TSR calculated from closing price 30 June 2020 (as the last trading day in the period) to closing price 30 June 2023. TSR data includes reinvested
distributions and represents total return, not an annualised figure. S&P ASX 200 and S&P ASX 200 A-REIT indices are accumulation indices.
Total shareholder return – selected peers summary
3-year return
1 Jul 20 to 30 Jun 23
1H23
1 Jul 22 to 31 Dec 22
2H23
1 Jan 23 to 30 Jun 23
FY23
1 Jul 22 to 30 Jun 23
Centuria Capital Group
Peer
Peer
Peer
Peer
Peer
Peer
Peer
Peer
Indices
S&P ASX 200
S&P ASX 200/A-REIT
Source: TSR data from IRESS.
7.3%
48.9%
46.7%
41.3%
39.1%
20.8%
20.1%
17.8%
0.3%
37.2%
26.4%
(2.6%)
12.2%
3.8%
(1.9%)
14.1%
12.5%
5.4%
10.5%
(9.6%)
9.8%
4.0%
0.1%
(5.2%)
15.0%
16.5%
(5.4%)
(8.8%)
1.5%
8.6%
3.7%
4.5%
3.9%
(2.5%)
6.4%
19.4%
14.3%
7.9%
2.6%
7.1%
19.9%
(6.3%)
14.8%
8.1%
Notes: TSR data includes reinvested distributions and represents total return, not an annualised figure. TSR is calculated from the closing price of the
last trading day in the prior period to capture share price return from the first day of the relevant period S&P ASX 200 and S&P ASX 200 A-REIT indices
are accumulation indices.
A major focus for FY23 was maintaining the Group’s
strategy of growing AUM and ongoing diversification of
our portfolio across multiple sectors. During FY23, the
Group’s AUM continued to grow to $21.0 billion. This
growth was complemented with a resilient operating EPS
of 14.5 cents, matching the Group's record performance in
FY22, further supported by a distribution of 11.6 cents per
security (cps) which was both in line with guidance as well
as representing an increase of 5.5% compared with the
prior year.
This resilient operating performance was delivered despite
volatile market conditions.
However, despite the delivery of robust earnings and an
increase in distributions for FY23, like many of our peers
and the broader S&P/ASX200 Index, our share price has
been negatively impacted by the deteriorating global
equity markets. This has been against a backdrop of
geopolitical tensions as well as economic uncertainty on a
global scale. As a result for FY23, Centuria’s one-year TSR
was -2.5% with the three-year TSR being 7.3%, resulting
in full forfeiture of the absolute TSR component of the
Tranche 8 LTI awards during the year.
Notwithstanding our one-year TSR outcome, which
has been impacted by external market factors outside
executives’ control, it is important to reiterate the
substantial compound annual growth rate in AUM of 49.0%
achieved over the same three-year period. This clearly
demonstrates the leadership of our highly experienced
Joint CEOs and high performing executive team to execute
the Group’s growth strategy over an extended period.
Fixed remuneration
Fixed remuneration consists of base remuneration (which
is calculated on a total cost basis and includes any FBT
charges related to employee benefits), as well as employer
contributions to superannuation funds.
For senior management excluding the Joint CEOs, this is
reviewed annually by the Joint CEOs and the Nomination
and Remuneration Committee. The process consists of a
review of Group, business unit and individual performance
as well as relevant comparative remuneration in the
market. The same process is used by the Nomination
and Remuneration Committee when reviewing the fixed
remuneration of the Joint CEOs.
Senior Management are given the opportunity to
receive their fixed remuneration in a variety of forms
including cash and salary sacrifice items, as motor
vehicle allowances and/or additional superannuation
contributions.
Short-term incentives (STI)
The objective of the STI program is to link the achievement
of the Group’s non-financial and financial targets with
the remuneration received by senior management
accountable for meeting those targets. The potential STI
available is set at a level to provide sufficient incentive
for senior management to achieve operational targets
and such that the cost to the Group is reasonable in the
circumstances.
82 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 83
Directors' report
STI structure
FY23 STI plan structure
Performance period
12 months
Opportunity
Joint CEOs
125% of total fixed remuneration at maximum.
CFO
100% of total fixed remuneration at maximum.
How the STI is paid
STI awards may be settled in either cash and/or shares at the Board's discretion.
Performance
measures and
conditions
Financial
measures (60%)
• Growth in Assets Under Management (AUM)
• Operating Earnings Per Share (EPS) Growth
Non-financial
measures (40%)
• Equity sources, sectors and new funds
• Cost management
• Environmental, Social and Governance (ESG)
– Sustainability
– Diversity and Governance
• Staff engagement
• Tenant satisfaction
How are STI targets
set?
In determining STI hurdle targets, the following factors are considered by the Committee and
Board:
• Performance of peer fund managers over a range of asset classes.
• Direct returns from asset classes, in particular property, equities and fixed interest.
• Outlook for financial markets including fixed interest returns.
• Effect of financial market views on asset values e.g. cap rate compression or expansion.
• Performance of Centuria compared to other peer managers.
• Quality of Centuria’s financial products compared to market and how contemporary they are in
this context.
How is the STI
assessed?
At the Board’s absolute discretion, the Group’s Senior Management may be provided with the
opportunity to receive an annual, performance-based incentive.
The Nomination and Remuneration Committee assesses annually the individual scorecards of
participants against the KPIs in determination of the annual STI outcome. The 'STI achieved'
section outlines the overall scorecard outcomes for FY23.
What happens when
an executive ceases
employment?
Joint CEOs
If employment terminates part way through a financial year (other than for
termination for serious misconduct), the Joint CEOs are entitled to the STI for
the full financial year.
Is there a KMP
minimum security
holder requirement?
CFO
Yes.
If employment terminates part way through a financial year, the CFO forfeits any
applicable STI for the relevant financial year.
The Joint CEOs must hold an equivalent of 200% of their fixed remuneration in the form of equity.
The CFO must hold an equivalent of 100% of his fixed remuneration in the form of equity.
Any new KMP must accumulate and hold an equivalent of 200% for Joint CEOs and 100% for CFO
of their fixed remuneration in the form of equity within the first five years from the date of their
appointment.
Is there any STI
deferral?
Yes, if the minimum requirement for the above significant security holdings is not met by KMPs,
25% of the vested STI will be deferred in the form of equity for a period of one year, or longer if
required to meet the threshold for ownership in the Group.
Malus and clawback
In the event of fraud, dishonesty or material misstatement of financial statements, the Board may
make a determination, including 'clawing back' of all deferred STIs, to ensure that no unfair benefit
is obtained by a participant.
FY23 performance measures and objectives
FY23 STI
scorecard
performance
hurdle
Weighting Rationale for use
Target criteria
Directors' report
Outcomes
Financial metrics
AUM
15%
Operating
EPS
15%
15%
Equity
sources,
sectors and
new funds
Increasing AUM
is fundamental to
the Group’s growth
strategy.
Target = attain FY22 AUM, resulting
in 50% of award being reached.
Target was reached resulting in
50% of award being granted for
this component.
Outperformance = FY22 AUM + 10%,
resulting in additional 50% of the
award being granted.
Outperformance target not
reached resulting in no award for
this component.
Ensures continued
focus on growing
and managing the
profitability of the
business as a key
driver of sustainable
securityholder
returns.
Provides alignment
to the Group’s growth
strategy.
Target = guidance of 14.5 cps,
resulting in 100% of the award
being granted.
Outperformance target = 14.5 cps
plus 10%, resulting in 125% of
award being granted.
Target of 14.5cps reached, 100%
of award granted.
Not achieved.
Target = creation of open direct
fund in new sector with minimum
AUM $200 million, resulting in 100%
of award being granted.
Target achieved.
Cost
management
15%
Ensures continued
agility to protect
securityholder
returns.
Outperformance target achieved
resulting in 125% of the award
granted.
Outperformance target = as above
with AUM above $300 million
resulting in 125% of award being
granted.
Cost management initiatives
undertaken:
• Reduced travel and entertainment
• Reduced consulting and
professional fees
• Reduced marketing costs
• Reduction of other controllable
overheads
Target = reduction of overheads
across the above initiatives by 5%
or more resulting in 100% of the
award being granted.
Outperformance target = reduction
of above by 10% or more resulting
in 125% of award being granted.
Outperformance target achieved
resulting in 125% of the award
granted.
84 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 85
Directors' report
FY23 STI
scorecard
performance
hurdle
Weighting Rationale for use
Target criteria
Outcomes
Non-financial metrics
Sustainability
10%
Provides alignment
to the areas of
focus under our
sustainability
framework: ‘valued
stakeholders’,
‘responsible
business principles’
and being ‘conscious
of climate change’.
Diversity and
governance
10%
Staff
engagement
10%
Tenant
satisfaction
10%
A motivated and
engagement
workforce will drive
positive business.
Loyal tenants
through an
integrated property
management
supports sustainable
earnings.
Targets:
Target achieved.
• All new developments for CIP and
COF to achieve a minimum 5-star
Green Star design rating.
• Improve COF NABERS
Sustainability portfolio Index
energy ratings of 4.8.
• COF delivered Wyatt Street and
CIP delivered 95-105 South
Gippsland Highway, both with
5-star Green Star.
• Score improvement to 4.9 up
from 4.8 in FY22.
• Launch new ESG Policy for the
Group, and supporting ESG
investment guidelines for CIP and
COF.
• Launch new sustainability targets.
• Achieve minimum 65% staff
engagement score regarding
Centuria ESG commitment.
Target = Maintain Property Council
of Australia diversity target
40/40/20 across entire group,
resulting in 100% of award being
granted.
Target = overall engagement score1
of greater than 75%, resulting in
award being granted.
• New ESG Policy approved
by the Board; New ESG
investment approach
guidelines approved and
released for CIP and COF.
• Centuria launched new
sustainability targets including
zero scope emissions by 2035
and elimination of gas and
diesel in operations, where
practical.
• Staff engagement score of
75% achieved.
Target achieved.
Target achieved.
Target = overall engagement score
of greater than 75%, resulting in
award being granted.
Target achieved.
1. Employee engagement is measured as a score through a bi-annual Group-wide survey conducted independently through 'Culture Amp' and supported
by an independent consultant who reported directly to the CNI Board.
In addition to the scorecard above, the Board took into
consideration the following non-financial achievements
made in FY23 in determining the final outcome of the FY23
STI awards:
• Launched new sustainability targets, targeting Zero
Scope 2 emission by 100% electricity sourced from
renewables and focusing on practical elimination of gas
and diesel in operations by 2035.
• The target Group operating performance was achieved
• Increased stakeholder and investor engagement.
despite a backdrop adverse economic and market
conditions.
• The Group has maintained its comprehensive approach
to the Employee Engagement Survey. This survey was
again deployed across the business using Culture
Amp, with the results exceeding real estate industry
benchmarks for employee engagement.
• Further diversified the Group's representation across the
various property sectors by establishing and growing its
dedicated Agriculture Fund and the Centuria Bass real
estate credit business.
86 | Centuria Capital Group – Annual Report 2023
• Strengthened and expanded sources of listed and
unlisted capital sources.
• The Group maintained its ongoing community
engagement program, including marking 10 years of
continued support for St Lucy’s School.
• Despite headwinds impacting certain asset sectors non
financial property services metrics, including Average
Tenant Retention, Portfolio Occupancy and square
meters of leasing deals completed all exceeded prior
year benchmarks.
Directors' report
STI achieved
The table below outlines the percentage of target STI achieved (and forfeited) in relation to financial and non-financial
KPIs, and the total STI awarded, for each executive in 2023.
Executive
STI on maximum
opportunity
Financial
Non-financial
Weighting Achieved Forfeited Weighting Achieved Forfeited STI awarded
John McBain (Joint CEO)
$1,940,625
Jason Huljich (Joint CEO) $1,940,625
Simon Holt (CFO)
$786,500
60%
60%
60%
80%
80%
80%
20%
20%
20%
40%
40%
40%
100%
100%
100%
0%
0%
0%
$1,707,750
$1,707,750
$707,850
Long-term incentives (LTI)
The Group has an executive incentive plan (LTI Plan) which forms a key element of the Group’s incentive and retention
strategy for Senior Management under which Performance Rights (Rights) are issued.
The primary objectives of the LTI Plan include:
• focusing executives on the longer term performance of the Group to drive long term shareholder value creation;
• ensuring Senior Management remuneration outcomes are aligned with shareholder interests, in particular, the strategic
goals and performance of the Group; and
• ensuring remuneration is competitive and aligned with general market practice by ASX listed entities.
Rights issued under the LTI plan are issued in accordance with the thresholds approved at the Annual General Meeting (AGM).
LTI structure
LTI plan structure
Performance period
Three year performance with 75% of any LTI award vesting in Year 3 with the remaining 25%
vesting in Year 4.
Opportunity
Joint CEOs
125% of total fixed remuneration at maximum.
CFO
95% of total fixed remuneration at maximum.
Instrument
Performance metrics
Performance Rights. The allocation of the LTI grants is on a face value basis using the volume
weighted average price of the Group’s securities over the five ASX trading days immediately
preceding 1 July of the grant year (being the date of the commencement of the performance
period).
Each performance right is a right to acquire one Security in the Group (or an equivalent cash
amount), subject to the achievement of the 'performance hurdles' set out below.
Relative Total
Securityholder
Return (RTSR)
(75%)
RTSR (compounded) when ranked
to the comparator group of S&P/
ASX 200 A-REIT Accumulation Index
stocks over the performance period.
Performance Rights subject to RTSR
Hurdle that vest.
Exceeds the comparator group 75th
percentile.
100%
More than the comparator group
50th percentile and less than 75th
percentile.
Between 50% to 100% progressive
pro-rata vesting (i.e. on a straight-
line basis).
Equal to the comparator group 50th
percentile.
Less than the comparator group
50th percentile.
50%
0%
Absolute Total
Securityholder
Return (ATSR)
(25%)
Annual ATSR achieved over the
performance period.
Performance Rights subject to ATSR
Hurdle that vest.
15% or greater
100%
Between 10% and 15%.
Between 25% to 100% progressive
pro-rata vesting (i.e. on a straight-
line basis).
10%
Less than 10%.
25%
0%
Centuria Capital Group – Annual Report 2023 | 87
Directors' report
LTI plan structure
Rationale for the
performance metric and
conditions
Both RTSR and ATSR measure the return securityholders would earn if they held a notional
number of securities over a period of time. RTSR provides a relative measure of growth in
the Group’s security price in comparison to relative peers (being the S&P/ASX200 A-REIT
accumulation index). ATSR provides an absolute measure of growth in the Group’s security
price.
The ATSR target is determined with reference to the following factors which can impact future
performance:
• Performance of peer fund managers over a range of asset classes.
• Direct returns from asset classes in particular property, equities and fixed interest.
• Outlook for financial markets including fixed interest returns.
• Effective financial market views on asset values e.g. cap rate compression or expansion.
• Performance of Centuria compared to other peer managers.
• Quality of Centuria’s financial products compared to market and how contemporary they are
in this context.
By combining RTSR with an ATSR measure, executives can be rewarded for driving positive
returns and investors have the confidence that interests are aligned with long-term business
growth and the creation of shareholder wealth. The inclusion of an ATSR metric has been
designed to counter-balance RTSR outcomes which may vest when overall market conditions
are down.
LTI plan structure
What happens when
an executive ceases
employment?
Malus and clawback
If a participant ceases to be employed by the Group before the end of the Performance Period,
whether the Performance Rights lapse will depend on the circumstances of cessation.
If a participant ceases employment due to resignation, termination for cause or termination for
gross misconduct, all unvested Performance Rights will lapse at cessation unless the Board
determines otherwise.
If a participant ceases employment for any other reason prior to Performance Rights vesting,
a pro-rata number of unvested Performance Rights (based on the Performance Period
that has elapsed at the time of cessation) will remain unvested until the end of the original
Performance Period and vest to the extent that the relevant performance hurdles have been
satisfied at any time. The balance of Performance Rights will lapse at cessation.
In the event of fraud, dishonesty or material misstatement of financial statements, the Board
may make a determination, including lapsing unvested Performance Rights or 'clawing back'
securities allocated upon vesting, to ensure that no unfair benefit is obtained by a participant.
Dividends and voting
rights
Rights do not carry a right to vote or to dividends or, in general, a right to participate in other
corporate actions such as bonus issues.
Re-testing
Change of control
provisions
Awards are tested once, at the end of the performance period of three years. There is no
further retesting of the performance conditions.
If a change of control event occurs, the Board has the discretionary power to deter-mine
whether any unvested Performance Rights should ultimately vest, lapse or become subject
to different vesting conditions. In making such a determination, the Board may have regard
to any factors that the Board considers relevant, including the period elapsed, the extent to
which the vesting conditions have been satisfied and the circumstances of the event.
LTI grants
Currently, the Group operates three tranches of the LTIP as below:
Tranche Grant date (Joint CEOs) Grant date (other participants) Performance period
7
8
9
10
18 October 2019
18 October 2019
1 July 2019 to 30 June 2022 (vested 12 August 2022)
26 November 2020
13 November 2020
1 July 2020 to 30 June 2023 (Tranche to be fully forfeited)
3 December 2021
12 August 2021
1 July 2021 to 30 June 2024
5 December 2022
12 August 2022
1 July 2022 to 30 June 2025
The table below outlines Rights which were previously granted to Senior Management and testing against those conditions.
Rights
granted
during the
year
Rights
vested and
exercised
during the
year
Held at 1 July
2022
Rights
forfeited
during the
year
Rights held
at 30 June
2023
Fair value to
be expensed
in future
periods ($)
Grant date
Directors' report
John McBain
Tranche 7 - Absolute TSR
Tranche 7 - FUM Growth
Tranche 8 Relative TSR
Tranche 8 Absolute TSR
Tranche 9 Relative TSR
Tranche 9 Absolute TSR
Tranche 10 Relative TSR
Tranche 10 Absolute TSR
Total
Jason Huljich
Tranche 7 - Absolute TSR
Tranche 7 - FUM Growth
Tranche 8 Relative TSR
Tranche 8 Absolute TSR
Tranche 9 Relative TSR
Tranche 9 Absolute TSR
Tranche 10 Relative TSR
Tranche 10 Absolute TSR
Total
Simon Holt
Tranche 7 - Absolute TSR
Tranche 7 - FUM Growth
Tranche 8 Relative TSR
Tranche 8 Absolute TSR
Tranche 9 Relative TSR
Tranche 9 Absolute TSR
Tranche 10 Relative TSR
Tranche 10 Absolute TSR
562,500
187,500
682,278
227,426
530,806
176,935
-
-
-
-
-
-
-
-
758,610
252,870
-
562,500
187,500
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
18 Oct 19
18 Oct 19
682,278
26 Nov 20
227,426
26 Nov 20
-
-
-
-
530,806
3 Dec 21
1,009,858
176,935
3 Dec 21
207,899
758,610
5 Dec 22
493,097
252,870
5 Dec 22
130,228
2,367,445
1,011,480
187,500
562,500
2,628,925
1,841,082
562,500
187,500
682,278
227,426
530,806
176,935
-
-
-
-
-
-
-
-
758,610
252,870
-
562,500
187,500
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
18 Oct 19
18 Oct 19
682,278
26 Nov 20
227,426
26 Nov 20
-
-
-
-
530,806
3 Dec 21
1,009,858
176,935
3 Dec 21
207,899
758,610
5 Dec 22
493,097
252,870
5 Dec 22
130,228
2,367,445
1,011,480
187,500
562,500
2,628,925
1,841,082
208,542
69,514
274,630
91,543
204,370
68,123
-
-
-
-
-
-
-
-
292,078
97,360
-
208,542
69,514
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
18 Oct 19
18 Oct 19
274,630
26 Nov 20
91,543
26 Nov 20
-
-
-
-
204,370
12 Aug 21
415,382
68,123
12 Aug 21
83,110
292,078
12 Aug 22
233,662
97,360
12 Aug 22
64,258
Total
916,722
389,438
69,514
208,542
1,028,104
Executive Total
5,651,612
2,412,398
444,514
1,333,542
6,285,954
796,412
4,478,576
1. The Tranche 8 Relative TSR fair value is $1.75 for Joint CEOs and $1.58 for CFO.
2. The Tranche 8 Absolute TSR fair value is $1.29 for Joint CEOs and $1.10 for CFO.
3. The Tranche 9 Relative TSR fair values are $1.92 (three-year vesting) and $1.85 (four-year vesting) for Joint CEOs and $2.05 (three-year vesting) and
$1.98 (four-year vesting) for CFO.
4. The Tranche 9 Absolute TSR fair value are $1.18 (three-year vesting) and $1.16 (four-year vesting) for Joint CEOs and $1.23 (three-year vesting) and
$1.19 (four-year vesting) for CFO.
5. The Tranche 10 Relative TSR fair values are $0.68 (three-year vesting) and $0.64 (four-year vesting) for Joint CEOs and $0.83 (three-year vesting) and
$0.79 (four-year vesting) for CFO.
6. The Tranche 10 Absolute TSR fair value are $0.53 (three-year vesting) and $0.51 (four-year vesting) for Joint CEOs and $0.69 (three-year vesting) and
$0.65 (four-year vesting) for CFO.
7. The maximum value of the rights yet to vest is the fair value amount at grant date yet to be reflected in the Group’s consolidated income statement. The
minimum future value is $nil as the future performance conditions may not be met.
88 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 89
Directors' report
Directors' report
Key terms of employment contracts
Joint Chief Executive Officers
Mr John E. McBain, was appointed as CEO of the Group in
April 2008. Mr Jason C. Huljich, was appointed as Joint CEO
of the Group in June 2019. Mr John E. McBain and Mr Jason
C. Huljich are employed under contract. The summary
of the major terms and conditions of their employment
contracts are as follows:
• Fixed compensation plus superannuation contributions.
• Car parking within close proximity to the Group’s office.
• Eligible to participate in the bonus program determined
at the discretion of the Board.
• The Group may terminate their employment contract by
providing six months written notice or provide payment
in lieu of the notice period plus an additional six months.
Any payment in lieu of notice will be based on the total
fixed compensation package.
• The Group may terminate their employment contract
at any time without notice if serious misconduct has
occurred. When termination with cause occurs, the
Joint Chief Executive Officers are only entitled to
remuneration up to the date of termination.
The Nomination and Remuneration Committee ensures
severance payments due to the Joint Chief Executive
Officers on termination are limited to pre-established
contractual arrangements which do not commit the Group
to making any unjustified payments in the event of non-
performance.
Other Senior Management (standard contracts)
All Senior Management are employed under contract.
The Group may terminate their employment agreement
by providing three months written notice or providing
payment in lieu of the notice period (based on the total
fixed compensation package).
Summary of achieved forfeited STI and Tranche
8 LTI
The table below outlines the percentage of target STIs
and LTIs achieved (and forfeited) in relation to financial
and non-financial KPIs, and the total awarded, for each
executive for the financial year ended 30 June 2023.
Short term incentives
John McBain
FY23 maximum STI $1,940,625
Jason Huljich
FY23 maximum STI $1,940,625
Simon Holt
FY23 maximum STI $786,500
%FY22 STI
Total STI ($)
Achieved
Forfeited
Achieved
Forfeited
Achieved
Forfeited
88%
12%
88%
12%
90%
10%
$1,707.50
$232,875
$1,707.50
$232,875
$707,850
$78,650
Long term incentives
Performance Rights achieved/
to be forfeited
Performance Rights achieved/
to be forfeited (%)
John McBain
Tranche 8 Performance Rights
at grant date $1,487,366
Jason Huljich
Tranche 8 Performance Rights
at grant date $1,487,366
Simon Holt
Tranche 8 Performance Rights
at grant date $534,613
Achieved
Forfeited
Achieved
Forfeited
Achieved
Forfeited
$-
$1,487,366
$-
$1,487,366
$-
$534,613
0%
100%
0%
100%
0%
100%
Total LTI ($)
$-
$1,487,366
$-
$1,487,366
$-
$534,613
Statutory remuneration table to KMP
The following table discloses total remuneration of Executive Directors and Senior Management in accordance with the
Corporations Act 2001:
Executive KMP
Mr John E. McBain
Mr Jason C. Huljich
Mr Simon W. Holt
Total
Short-term employee benefits
Other long-term benefits
Salaries
including
superannuation
($)1
Short term
incentive ($)
Long service
leave ($)
Share-based
payments ($)
Total $
1,552,500
1,707,750
1,552,500
1,940,625
45,406
90,109
1,114,435
4,420,091
1,175,247
4,758,481
1,552,500
1,707,750
397
1,114,435
4,375,082
1,552,500
1,940,625
786,500
786,500
707,850
786,500
3,891,500
4,123,350
3,891,500
4,667,750
29,356
17,140
18,702
62,943
138,167
1,175,247
4,697,728
446,109
445,780
1,957,599
2,037,482
2,674,979
10,752,772
2,796,274
11,493,691
Year
2023
2022
2023
2022
2023
2022
2023
2022
1. KMP fees are paid as cash and are inclusive of superannuation contributions which are paid in accordance with the applicable superannuation
legislation. KMPs are not entitled to retirement benefits other than superannuation.
Total fees for each KMP disclosed in the table above include superannuation contributions as follows:
• Mr John E. McBain $25,292 (2022: $23,568)
• Mr Jason C. Huljich $25,292 (2022: $23,568)
• Mr Simon W. Holt $25,292 (2022: $23,568)
Non-Executive Director remuneration
Objective
The Board seeks to set aggregate remuneration at a level
that provides the Group with the ability to attract and retain
Directors of the highest calibre, whilst incurring a cost that
is acceptable to shareholders.
• Non-Executive Directors receive adequate remuneration
to attract and retain the requisite talent.
• Reflect the complexity of the Group structure and the
time commitment associated with oversight of multi-
faceted operating entities within the Group.
• Reflects the risk and responsibility accepted by the Non-
Executive Directors and their commercial expertise.
• The structure should align the Non-Executive Directors
with investors, not providing any disincentive to take
independent action.
The payment of the additional fees to each Chairman
recognises the additional time commitment and
responsibility associated with the position. Non-Executive
Directors do not receive equity as a form of payment.
As highlighted on page 75, the Centuria structure, whilst
not unique, comprises multiple operating entities, both
listed and unlisted. These include CNI, COF, CIP, Centuria
Life, Centuria Healthcare, Centuria New Zealand, Centuria
Bass Credit and Primewest. Each Board has specific
requirements and obligations. In recognition of the
complexity of the Group and in the interests of good
governance and transparency, the Group has adopted a
Directors’ fee schedule which is disclosed in the table
below.
The fee schedule covers the Board and Board Committee
roles across the headstock and other operating entities
which the Centuria directors sit on. The fee schedule is
designed to improve transparency while recognising that
each board is responsible for actively overseeing the
financial position and monitoring the business and affairs
of the particular entity on behalf of its stakeholders, to
whom directors are accountable.
In determining the fee schedule, the Non-Executive
Director fees were benchmarked against the same peer
group of S&P/ASX200 A-REIT. Additionally, the complexity
of the overall Group and the commitment levels required
by Non-Executive Directors was considered in setting the
level of fees.
Total incentives ($)
$1,707.50
$1,720,241
$1,707.50
$1,720,241
$707,850
$613,263
Structure
The Constitution and the ASX Listing Rules specify that the
aggregate remuneration of Non-Executive Directors shall
be determined from time to time by a general meeting. An
amount not exceeding the aggregate amount determined
is then divided between the Directors as agreed. An
aggregate maximum amount of not more than $2,000,000
per year was approved at the 2017 Annual General Meeting.
Each Director receives a fee for being a Director of Group
companies and an additional fee is paid to the Chairman
and to the Chairman of each Board Committee.
90 | Centuria Capital Group – Annual Report 2023
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Directors' report
Directors' report
The new fee schedule, outlined below, became effective from 1 July 2022 to 30 June 2023:
Director fee schedule
Centuria Capital Limited Board
Centuria Capital Limited Audit, Risk and Compliance Committee
Centuria Capital Limited Conflicts Committee
Centuria Capital Limited Nomination and Remuneration Committee
Centuria Capital Limited Culture, People and ESG Committee
Centuria Life Limited Board
Centuria Life Limited Audit Committee
Centuria Life Limited Risk and Compliance Committee
Centuria Life Limited Investment Committee
Centuria Property Funds Limited Board
Chair
$348,000
$20,800
$52,000
$20,800
$20,800
$93,600
-
-
$72,800
Member
$114,400
$10,400
$15,600
$10,400
$10,400
$31,200
$10,400
-
-
$114,400
$31,200/$57,2001
Centuria Property Funds Limited Audit, Risk and Compliance Committee
$15,600
$10,400
Centuria Property Funds No. 2 Limited Board
$119,600
$31,200/$57,2001
Centuria Property Funds No. 2 Limited Audit, Risk and Compliance Committee
Centuria Healthcare Pty Ltd Board
Centuria Healthcare Asset Management Ltd Board
-2
$72,800
$52,000
$10,400
-
$31,200
1. Committee members who are also Directors on the Centuria Capital Group Board are remunerated $31,200 and all other committee members are
remunerated $57,200.
2. The Chair of the Centuria Property Funds No.2 Limited Audit, Risk and Compliance Committee is a director on the Centuria Capital Group Board and does
not receive an additional fee.
Details of Boards and Board Committees
Centuria Capital Limited
The Board of Centuria Capital Limited sets the strategic
direction and objectives of the Centuria Group. Through
its regular monthly board meetings, as well as the
many transaction specific meetings, it oversees the
performance of the executive management team in
delivering against the strategic goals across the entire
operations of the Group.
The Board of Centuria Capital Limited and the Board of
Centuria Funds Management Limited, as the responsibility
entity of the Centuria Capital Fund, oversee and govern
the complex stapled Group structure (Ticker Code: CNI).
Where appropriate, meetings take place concurrently for
maximum efficiency.
Board committees chaired by independent Non-Executive
Directors and established by the Centuria Capital Limited
Board provide a forum for greater oversight of the
governance requirements of the organisation.
Centuria Funds Management Limited
The Centuria Funds Management Limited Board
concurrently with the Centuria Capital Limited Board
and as the responsible entity of the stapled Centuria
Capital Fund, provides oversight over management
decision making, particularly in relation to the various
co-investment stakes. This includes associated capital
raisings and borrowings through facilities and note
issuances in the market. Centuria Funds Management
Limited holds an Australian Financial Services Licence that
enables it to provide a wide range of financial products and
investment advisory services as well as being the trustee
of the Centuria Capital No. 2 Fund which is the issuer of
listed redeemable debt notes (Ticker Code: C2FHA).
Centuria Capital Fund is a fund that has each of its units
stapled to Centuria Capital Limited shares, with the
two securities traded alongside each other as a single
instrument (Ticker Code: CNI). The Centuria Capital Fund
(CCF) holds various strategic co-investment stakes
primarily in listed and unlisted funds managed by Centuria.
CCF through its subsidiaries is also the vehicle through
which the group:
• undertakes both long-term and short-term investment
decisions;
• supports the establishment of new funds through the
provision of initial seed capital;
• provides underwriting support as and when required;
• undertakes equity raisings; and
• raises finance through various external facilities and the
issuance of both listed and unlisted notes.
Centuria Life Limited
Centuria Life Limited is an APRA regulated entity and is the
vehicle through which the Centuria Capital Group issues
and offers its full suite of Investment Bond products
in addition to providing investment management and
administration services to Over Fifty Guardian Friendly
Society Limited (Guardian). Guardian has in excess of
$800 million in assets under management. With the great
majority of the products offered by the business having
daily unit pricing, it requires the application of strict
governance and compliance systems and processes
to meet regulatory requirements in addition to the
continuous monitoring of Board and APRA mandated
capital adequacy requirements.
Centuria Healthcare Pty Limited
Centuria Capital Group owns 58.99% of Centuria
Healthcare Pty Limited, formerly Heathley Healthcare.
Through its various subsidiaries, including Centuria
Healthcare Asset Management Limited the Responsible
Entity for a number of unlisted healthcare registered
scheme, this company provides extensive property, funds
management and development management services
across a range of established healthcare assets and
development opportunities. The Centuria Capital Group
currently has a majority interest in Centuria Healthcare Pty
Limited with a put and call option exercisable in 2024 to
acquire the remaining stake in the healthcare business. In
the meantime, Centuria Capital has day to day control over
the operating and financial decisions of the business and
the Board meets on a monthly basis to set the strategic
direction of Centuria’s healthcare business.
Centuria Property Funds Limited
Centuria Property Funds Limited (CPFL) is the responsible
entity of the ASX listed Centuria Office REIT (Ticker
Code: COF), the responsible entity of the open ended
fund Centuria Diversified Property Fund and Centuria
Agriculture Fund, and ten closed ended registered
schemes with over $4.2 billion total assets under
management. CPFL is also regulated by ASIC to provide
Custodian Services to various property funds. The Board
must ensure that CPFL continually meets its obligations as
an Australian Financial Services Licence holder including
capital adequacy, minimum net tangible asset, liquidity and
cashflow testing requirements.
Centuria Property Funds No. 2 Limited
Centuria Property Funds No.2 Limited (CPF2L) is the
responsible entity of the ASX listed Centuria Industrial
Fund (Ticker Code: CIP) and the responsible entity of the
open ended Centuria Healthcare Property Fund and four
closed ended registered schemes with over $4.2 billion
total assets under management. CPF2L is also regulated
by ASIC to provide Custodian Services to various property
funds. The Board must ensure that CPF2L continually
meets its obligations as an Australian Financial Services
Licence holder including capital adequacy, minimum net
tangible asset, liquidity and cashflow testing requirements.
Audit, Risk and Compliance Committee
The CNI Board has an established Audit, Risk and
Compliance Committee to assist in relation to audit, risk
management and compliance oversight responsibilities,
ensuring the integrity of the Group’s financial reporting
and compliance with statutory and regulatory obligations
mandated by ASIC and prudential requirements governed
by APRA. This Committee meets on a quarterly basis and
is also accountable for assessing the effectiveness of the
Group’s Risk Management Framework and ensuring there
is a continuous process for the management of significant
risks throughout the Group.
Conflicts Committee
Identifying and addressing all matters involving conflicts of
interest, whether actual or perceived is the cornerstone of
good corporate governance. The Board of Centuria Capital
Group has established a Conflicts Committee to review
and assess specific arrangements proposed to manage
conflicts as and when they arise. The Committee has an
independent Chairman, Professor Simon Rice AO, and its
members are all independent Non-Executive Directors
from within the Group. Meetings take place whenever
required to provide the Board of the relevant Centuria
entity with guidance on whether the measures proposed,
if properly implemented, are adequate to manage the
conflict. Amongst its A-REIT peers in the S&P/ASX200,
Centuria is the only company to have such a committee.
Nomination and Remuneration Committee
The Nomination and Remuneration Committee is tasked
with ensuring that the Boards of the various Centuria
Group entities comprise of members with the appropriate
mix of skills, tenure, experience, training and diversity to
provide the right balance of stewardship and oversight on
behalf of its stakeholders. The Committee is also tasked
with providing appropriate governance and monitoring
of the Group’s remuneration policies, adherence to
codes of conduct as well as advice with respect to the
appropriate quantum and structure of remuneration for
Senior Management and staff. The aim of the Nomination
and Remuneration Committee is to ensure the appropriate
balance of risk and rewards for staff whilst ensuring
appropriate stewardship of the Group’s resources on
behalf of its stakeholders.
Culture and ESG Committee
The Culture and ESG Committee was established by
the Board as a result of the Board’s recognition of the
importance of ESG to the long-term sustainability of
the Group and the increasing relevance to Centuria’s
investors as the Group grows. The Board also recognised
the Group’s responsibility to the community in which it
operates and as such, established the Committee to assist
the Board in fulfilling its oversight responsibilities and to
make recommendations on matters pertaining to culture
and environmental, social and governance.
Investment Committees
Centuria Capital Group has various investment committees
to oversee the relevant entity’s investment and portfolio
management practices to ensure they are in line with
the risk and return requirements of its investors, as
well as ensuring that investment decisions are made in
accordance with the appropriate regulatory requirements.
The Centuria Life and Over Fifty Guardian Friendly Society
Investment Committees in particular monitor fund rules
and target achieving the long-term strategic objectives of
investors.
92 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 93
Directors' report
Directors' report
Non-Executive Director - statutory remuneration table
The below table outlines total fees paid to NEDs for 2022 and 2023. All the fees below include superannuation.
Non-Executive KMP
Mr Garry S. Charny
Ms Kristie R. Brown
Mr Peter J. Done
Mr John R. Slater
Ms Susan L. Wheeldon
Mr Nicholas R. Collishaw
Note2
Total
Year
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
Total fees1
$
514,800
495,000
140,400
125,312
239,200
230,000
239,200
230,000
156,000
146,771
-
52,727
1,289,600
1,279,810
1. Board and Board Committee fees are paid as cash and are inclusive of superannuation contributions which are paid in accordance with the applicable
superannuation legislation. Non Executive Directors are not entitled to retirement benefits other than superannuation.
Total fees for each Non Executive Director disclosed in the table above include superannuation contributions as follows:
• Mr Garry S. Charny $30,110 (2022: $29,932)
• Ms Kristie R. Brown $13,343 (2022: $11,392)
• Mr Peter J. Done $12,847 (2022: $10,455)
• Mr John R. Slater $31,294 (2022: $20,909)
• Ms Susan L. Wheeldon $7,412 (2022: $13,343)
• Mr Nicholas R. Collishaw $nil (2022: $4,242)
2. Mr Nicholas R. Collishaw resigned from the Board on 30 August 2021.
The below table shows how fees paid to each NED aligns with their roles in various subsidiary Boards and Committees as
per the fee schedule on page 92. This new fee structure and schedule was effective from 1 June 2021.
Mr Garry S. Charny
Year
Board
meetings
held during
FY23
Audit,
Risk and
Compliance
Committee
Board
Conflicts
Committee
Nomination
and
Remuneration
Committee
Culture
and ESG
Committee
Investment
Committee
Total $
Centuria Capital
Limited
Centuria Life
Limited
Centuria
Healthcare Pty
Ltd
Total
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
20 348,400
25 335,000
11
93,600
13
90,000
8
7
72,800
70,000
39 514,800
45 495,000
-
01
01
01
-
-
-
-
-
01
-
-
-
-
-
-
-
01
-
-
-
-
-
-
-
01
-
-
-
-
-
-
- 348,400
- 335,000
-
-
-
-
93,600
90,000
72,800
70,000
- 514,800
- 495,000
1. NED is chair/member of this committee, however receives no additional fee for their role on the committee.
Ms Kristie R. Brown Year
Board
meetings
held during
FY23
Audit,
Risk and
Compliance
Committee
Board
Conflicts
Committee
Nomination
and
Remuneration
Committee
Culture
and ESG
Committee
Investment
Committee
Total $
Centuria Capital
Limited1
Total
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
20 114,400
10,400
15,600
25 110,000
10,000
5,132
20 114,400
10,400
15,600
25 110,000
10,000
5,132
-
-
-
-
-
-
-
-
-
-
-
-
140,400
125,132
140,400
125,132
1. Ms Kristie Brown was appointed a member of the Centuria Capital Conflicts Committee on 22 February 2022.
Mr Peter J. Done
Year
Board
meetings
held during
FY23
Audit,
Risk and
Compliance
Committee
Board
Conflicts
Committee
Nomination
and
Remuneration
Committee
Culture
and ESG
Committee
Investment
Committee
Total $
Centuria Capital
Limited
Centuria Life
Limited
Centuria
Property Funds
Limited
Centuria
Property Funds
No. 2 Limited
Total
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
20 114,400
20,800
25 110,000
20,000
11
31,200
13
30,000
18
31,200
27
30,000
24
31,200
28
30,000
01
01
01
01
01
01
73 208,000
20,800
93 200,000
20,000
-
-
-
-
-
-
-
-
-
-
10,400
10,000
-
-
-
-
-
-
10,400
10,000
-
-
-
-
-
-
-
-
-
-
-
-
145,600
140,000
01
31,200
01
30,000
-
-
-
-
31,200
30,000
31,200
30,000
- 239,200
- 230,000
1. NED is chair/member of this committee, however receives no additional fee for their role on the committee.
94 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 95
Directors' report
Directors' report
Mr John R. Slater
Year
Board
meetings
held during
FY23
Audit,
Risk and
Compliance
Committee
Board
Conflicts
Committee
Nomination
and
Remuneration
Committee
Culture
and ESG
Committee
Investment
Committee
Total $
Centuria Capital
Limited
Centuria Life
Limited
Total
Ms Susan L.
Wheeldon
Centuria Capital
Limited1
Total
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
Year
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
20 114,400
10,400
25 110,000
10,000
11
31,200
13
30,000
-
-
31
145,600
10,400
38 140,000
10,000
-
-
-
-
-
-
10,400
10,000
-
-
10,400
10,000
-
-
-
-
-
-
-
-
135,200
130,000
72,800 104,000
70,000 100,000
72,800 239,200
70,000 230,000
Board
meetings
held during
FY23
Audit,
Risk and
Compliance
Committee
Board
Conflicts
Committee
Nomination
and
Remuneration
Committee
Culture
and ESG
Committee
Investment
Committee
Total $
20 114,400
25 110,000
20 114,400
25 110,000
-
-
-
-
-
20,800
20,800
-
156,000
9,688
7,083
20,000
-
20,800
20,800
9,688
7,083
20,000
-
-
-
146,771
156,000
146,771
1. Ms Susan Wheeldon was a member of the Conflicts Committee until 22 February 2022. On 22 February 2022, she was appointed Chair of the Nomination
and Remuneration Committee.
Mr Nicholas R.
Collishaw
Centuria Capital
Limited1
Centuria
Property Funds
Limited1
Centuria
Property Funds
No. 2 Limited1
Centuria
Healthcare Asset
Management
Limited2
Total
Year
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
2023 -
12 mths
2022 -
12 mths
Board
meetings
held during
FY23
Audit,
Risk and
Compliance
Committee
Board
Conflicts
Committee
Nomination
and
Remuneration
Committee
Culture
and ESG
Committee
Investment
Committee
Total $
-
-
25
18,333
-
-
27
5,000
-
-
28
5,000
-
6
-
-
22,727
-
51,060
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,667
-
-
-
-
-
-
-
1,667
-
-
-
-
-
-
-
-
-
-
-
20,000
-
5,000
-
5,000
-
22,727
-
52,727
1. Mr Nicholas Collishaw resigned from the Board of Centuria Capital Limited, Centuria Property Funds Limited and Centuria Property Funds No.2 Limited
on 30 August 2021
2. Mr Nicholas Collishaw resigned from the Board of Centuria Healthcare Asset Management Limited on 17 September 2021.
96 | Centuria Capital Group – Annual Report 2023
Related party transactions
Since 2021 the Board has adopted a policy that, as a matter of general principle, third party consultancy fees should not
be paid to entities that are related to independent directors. Any directors who are associated with entities that received
consulting fees have had their independence tested and confirmed by reference to ASIC guidelines on independence and
through an external review.
Accordingly, from 1 June 2021, no consulting fees have been paid to entities associated with CNI directors.
There were no fees paid during the year.
Director and Senior Management equity holdings and other transactions
Director and Senior Management equity holdings
Set out below are details of movements in fully paid ordinary shares held by Directors and Senior Management as at the
date of this report.
Name
Mr Garry S. Charny
Ms Kristie R. Brown
Mr Peter J. Done
Mr John R. Slater
Ms Susan L. Wheeldon
Mr Jason C. Huljich
Mr John E. McBain
Mr Simon W. Holt
Balance at 1
July 2022
422,753
-
1,506,182
3,110,677
-
6,258,581
7,700,782
1,008,385
Securities
acquired/
(sold)
Rights
exercised
Balance at 30
June 2023
Changes prior
to signing
Balance at
signing date
-
-
-
-
-
-
-
-
-
-
-
-
-
422,753
-
1,506,182
3,110,677
-
187,500
6,446,081
187,500
7,888,282
69,514
1,077,899
-
-
-
-
-
-
-
-
422,753
-
1,506,182
3,110,677
-
6,446,081
7,888,282
1,077,899
Set out below are the details of movement of performance rights held by KMPs during the year. The fair value attributable to
these rights can be found on page 89.
Name
Mr Jason C. Huljich
Mr John E. McBain
Mr Simon W. Holt
Balance at 1
July 2022
Rights granted
during the year
Rights vested and
exercised during
the year
Rights forfeited
during the year
Rights held at 30
June 2023
2,367,445
2,367,445
916,722
1,011,480
1,011,480
389,438
(187,500)
(187,500)
(562,500)
2,628,925
(562,500)
2,628,925
(69,514)
(208,542)
1,028,104
This report is made in accordance with a resolution of Directors.
Mr Garry S. Charny
Director
Sydney
18 August 2023
Peter Done
Director
Centuria Capital Group – Annual Report 2023 | 97
Lead Auditor's independence declaration
Lead Auditor's independence
declaration
Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001
To the Directors of Centuria Capital Limited
I declare that, to the best of my knowledge and belief, in relation to the audit of Centuria Capital Group
for the financial year ended 30 June 2023 there have been:
no contraventions of the auditor independence requirements as set out in the
Corporations Act 2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
i.
ii.
KPM_INI_01
PAR_SIG_01
PAR_NAM_01
PAR_POS_01
PAR_DAT_01
PAR_CIT_01
KPMG
Paul Thomas
Partner
Sydney
18 August 2023
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG
International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used
under license by the independent member firms of the KPMG global organisation. Liability limited by a scheme approved under
Professional Standards Legislation.
LISTED: 75-95 AND 105 CORIO QUAY RD GEELONG VIC
98 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 99
Financial statement contents
For the year ended 30 June 2023
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Note to the financial statements
A About the report
A1 General information
A2 Significant accounting policies
A3 Other new accounting standards and interpretations
A4 Use of judgements and estimates
A5 Segment summary
B Business performance
B1 Segment profit and loss
B2 Revenue
B3 Mark to market movements of financial instruments and property
B4 Expenses
B5 Finance costs
B6 Taxation
B7 Earnings/(losses) per security
B8 Dividends and distributions
C Assets and liabilities
C1 Segment balance sheet
C2 Receivables
C3 Financial assets
C4 Investment properties
C5 Inventory
C6 Intangible assets
C7 Payables
C8 Borrowings
C9 Call/put option liability
C10 Right of use asset/lease liability
C11 Contributed equity
C12 Commitments and contingencies
D Cash flows
D1 Operating segment cash flows
D2 Cash and cash equivalents
D3 Reconciliation of profit for the period to net cash flows from operating activities
E Group Structure
E1 Interests in associates and joint ventures
E2 Interests in subsidiaries
E3 Parent entity disclosure
F Other
F1 Share-based payment arrangements
F2 Financial instruments
F3 Remuneration of auditors
F4 Events subsequent to the reporting date
Directors’ declaration
Independent auditor’s report
100 | Centuria Industrial REIT – Annual Report 2023
102
103
104
106
108
108
108
108
109
110
110
112
112
116
119
119
120
120
123
124
126
126
130
131
134
134
136
137
137
139
140
140
141
142
142
143
143
144
144
148
152
154
154
155
162
162
163
164
UNLISTED: THE BOND MEDICAL CENTRE, BELLA VISTA NSW
Centuria Capital Group – Annual Report 2023 | 101
Financial statements
Financial statements
Consolidated statement of
comprehensive income
Consolidated statement of financial
position
For the year ended 30 June 2023
As at 30 June 2023
Revenue
Share of net profit of equity accounted investments
Net movement in policyholder liability
Notes
B1, B2
E1
Mark to market movements of financial instruments and property B3
B4
B5
B6
Expenses
Finance costs
Profit/(loss) before tax
Income tax expense
Profit/(loss) after tax
PROFIT/(LOSS) AFTER TAX IS ATTRIBUTABLE TO
Centuria Capital Limited
Centuria Capital Fund (non-controlling interests)
External non-controlling interests
Profit/(loss) after tax
Foreign currency translation reserve
Total comprehensive income/(loss) for the year
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR IS ATTRIBUTABLE TO
Centuria Capital Limited
Centuria Capital Fund (non-controlling interests)
External non-controlling interests
Total comprehensive income/(loss)
PROFIT/(LOSS) AFTER TAX ATTRIBUTABLE TO
Centuria Capital Limited
Centuria Capital Fund (non-controlling interests)
Profit/(loss) after tax attributable to Centuria Capital Group securityholders
EARNINGS/(LOSS) PER CENTURIA CAPITAL GROUP SECURITY
Basic (cents per stapled security)
Diluted (cents per stapled security)
EARNINGS PER CENTURIA CAPITAL LIMITED SHARE
Basic (cents per share)
Diluted (cents per share)
B7
B7
B7
B7
30 June 2023
$'000
30 June 2022
$'000
370,115
4,281
(10,001)
6,928
(206,052)
(38,538)
126,733
(20,801)
105,932
32,289
73,631
12
105,932
4,487
110,419
36,776
73,631
12
110,419
32,289
73,631
105,920
Cents
13.3
13.1
4.0
3.9
299,716
7,101
16,514
(190,384)
(135,313)
(31,593)
(33,959)
(3,402)
(37,361)
20,637
(58,489)
491
(37,361)
(4,262)
(41,623)
16,375
(58,489)
491
(41,623)
20,637
(58,489)
(37,852)
Cents
(4.8)
(4.8)
2.6
2.6
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
102 | Centuria Capital Group – Annual Report 2023
Cash and cash equivalents
Receivables
Income tax receivable
Financial assets
Other assets
Inventory
Deferred tax assets
Equity accounted investments
Investment properties
Right of use asset
Intangible assets
Total assets
Payables
Provisions
Borrowings
Provision for income tax
Interest rate swaps at fair value
Benefit Funds policyholder's liability
Call/put option liability
Deferred tax liabilities
Lease liability
Total liabilities
Net assets
EQUITY
Equity attributable to Centuria Capital Limited
Contributed equity
Reserves
Retained earnings
Notes
D2
C2
B6(b)
C3
C5
B6(c)
E1
C4
C10
C6
C7
C8
B6(b)
C9
B6(c)
C10
C11
Total equity attributable to Centuria Capital Limited
Equity attributable to Centuria Capital Fund (non-controlling interests)
Contributed equity
Accumulated losses
C11
Total equity attributable to Centuria Capital Fund (non-controlling interests)
Total equity attributable to Centuria Capital Group securityholders
Equity attributable to external non-controlling interests
Contributed equity
Accumulated losses
Total equity attributable to external non-controlling interests
30 June 2023
$'000
30 June 2022
$'0001,2
225,460
133,278
4,988
939,733
12,714
88,708
8,637
90,682
-
32,590
793,072
200,565
113,487
3,549
961,692
9,972
134,783
7,085
74,769
337,500
17,006
791,521
2,329,862
2,651,929
92,418
5,419
375,217
600
19,339
278,793
38,255
66,307
35,725
912,073
1,417,789
394,811
10,063
297,353
702,227
1,034,779
(322,592)
712,187
1,414,414
3,358
17
3,375
134,619
5,113
629,385
4,165
18,750
270,557
84,095
52,601
19,443
1,218,728
1,433,201
389,717
3,491
284,478
677,686
1,025,584
(313,452)
712,132
1,389,818
15,683
27,700
43,383
Total equity
1,417,789
1,433,201
1. See note C6 for details in relation to the prior period restatement within assets.
2. Prior year numbers have been represented to reflect current year presentation. See note B6 for details.
The above consolidated statement of financial position should be read in conjunction
with the accompanying notes.
Centuria Capital Group – Annual Report 2023 | 103
Financial statements
Financial statements
Consolidated statement of changes
in equity
For the year ended 30 June 2023
Centuria Capital Limited
Issued capital
$'000
Retained earnings
$'000
Total equity
$'000
Balance at 1 July 2022
Profit/(loss) for the year
Foreign currency translation reserve
Total comprehensive income for the year
Equity settled share based payments expense
Dividends and distributions paid/accrued
Stapled securities issued
Cost of equity raising
Capital invested to non-controlling interests
Deconsolidation of controlled property funds1
389,717
-
-
-
2,970
-
2,125
(1)
-
-
3,491
-
4,487
4,487
2,085
-
-
-
-
-
Balance at 30 June 2023
394,811
10,063
284,478
32,289
-
32,289
-
(17,264)
-
-
-
(2,150)
297,353
Total
677,686
32,289
4,487
36,776
5,055
(17,264)
2,125
(1)
-
(2,150)
702,227
1. Included in the deconsolidation of controlled property funds is a correction of the allocation of prior year profits between Centuria Capital Limited,
Centuria Capital Fund and external non-controlling interests.
Centuria Capital Fund
(non-controlling interests)
Contributed
equity
$'000
Accumulated
losses
$'000
1,025,584
(313,452)
-
-
-
-
-
9,201
(6)
-
-
73,631
-
-
-
-
(3,650)
Total
$'000
712,132
73,631
-
(6)
-
(3,650)
712,187
73,631
73,631
-
-
(79,121)
(79,121)
(96,385)
9,201
11,326
Total
attributable
to Centuria
Capital Group
Securityholders
$'000
1,389,818
105,920
4,487
110,407
5,055
(7)
-
External non-controlling interests
Contributed
equity
$'000
Retained
earnings
$'000
Total
$'000
Total equity
$'000
15,683
27,700
43,383
1,433,201
-
-
-
-
-
-
-
464
12
-
12
-
-
-
-
-
12
-
12
-
-
-
-
464
105,932
4,487
110,419
5,055
(96,385)
11,326
(7)
464
1,034,779
(322,592)
(5,800)
(12,789)
(27,695)
(40,484)
(46,284)
1,414,414
3,358
17
3,375
1,417,789
Centuria Capital Limited
Issued capital
$'000
Retained earnings
$'000
Total equity
$'000
Balance at 1 July 2021
Profit/(loss) for the year
Foreign currency translation reserve
Total comprehensive income/(loss) for the year
Equity settled share based payments expense
Dividends and distributions paid/accrued
Stapled securities issued
Cost of equity raising
Capital invested to non-controlling interests
Deconsolidation of controlled property funds
Fair value differential on acquisition (impact of
transaction as part of stapled group)
Change in value of securities issued
Balance at 30 June 2022
386,634
-
-
-
981
-
2,039
(173)
-
-
-
236
389,717
3,720
-
(4,262)
(4,262)
4,033
283,058
20,637
-
20,637
-
Total
673,412
20,637
(4,262)
16,375
5,014
-
-
-
-
-
-
-
(18,965)
(18,965)
-
-
-
-
(252)
-
2,039
(173)
-
-
(252)
236
External non-controlling interests
Centuria Capital Fund
(non-controlling interests)
Contributed
equity
$'000
Accumulated
losses
$'000
Total
attributable
to Centuria
Capital Group
Securityholders
$'000
Total
$'000
Contributed
equity
$'000
1,018,822
(183,970)
834,852
1,508,264
31,781
-
-
-
-
-
6,636
(344)
-
-
-
470
(58,489)
(58,489)
-
-
(58,489)
(58,489)
-
-
(37,852)
(4,262)
(42,114)
5,014
(70,523)
(70,523)
(89,488)
-
-
-
-
(470)
-
6,636
(344)
-
-
(470)
470
8,675
(517)
-
-
(722)
706
-
-
-
-
-
-
-
5,979
(22,077)
-
-
Retained
earnings
$'000
30,196
491
-
491
-
Total
$'000
Total equity
$'000
61,977
1,570,241
491
-
491
-
(37,361)
(4,262)
(41,623)
5,014
(3,895)
(3,895)
(93,383)
-
-
-
-
-
5,979
8,675
(517)
5,979
908
(21,169)
(21,169)
-
-
-
-
(722)
706
3,491
284,478
677,686
1,025,584
(313,452)
712,132
1,389,818
15,683
27,700
43,383
1,433,201
1. Included in the deconsolidation of controlled property funds is a correction of the allocation of prior year profits between Centuria Capital Limited,
Centuria Capital Fund and external non-controlling interests.
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
104 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 105
Financial statements
Financial statements
Consolidated statement of cash flows
Note
30 June 2023
$'000
30 June 2022
$'000
Note
30 June 2023
$'000
30 June 2022
$'000
For the year ended 30 June 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Management fees received
Performance fees received
Distributions received
Interest received
Rent received
Cash received on development projects
Payments to suppliers and employees
Interest paid
Income taxes paid
Applications - Benefits Funds
Redemptions - Benefits Funds
Net cash provided by operating activities
D3
CASH FLOWS FROM INVESTING ACTIVITIES
Disposal of equity accounted investments
Proceeds from sale of related party investments
Loans repaid from other parties
Repayment of loans by related parties
Sale of property held for sale
Sale of property held for development
Benefit Funds net disposals of investments in financial assets
Collections from reverse mortgage holders
Purchase of investments in related parties
Purchase of equity accounted investments
Loans to related parties
Loans to other parties
Purchase of property held for development
Payments of balances held in trust for related parties
Cash balance on deconsolidation of property funds
Payments for property, plant and equipment
Proceeds from sale of investments
Sale/(purchase) of investment property
Net cash provided by/(used in) investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings
Proceeds from issue of securities to securityholders of Centuria
Capital Group
Repayment of borrowings
Distributions paid to securityholders of Centuria Capital Group
Capitalised borrowing costs paid
Equity raising costs paid
Proceeds from issues of securities to external non-controlling
interests
Distributions paid to external non-controlling interests
Net cash (used in)/provided by financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at end of year
96,650
11,326
(162,749)
(93,474)
(1,094)
(7)
-
-
(149,348)
26,407
200,565
(1,512)
225,460
248,719
8,300
(23,395)
(90,524)
(1,900)
(328)
3,658
(3,820)
140,710
(71,711)
273,351
(1,075)
200,565
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
204,747
143
54,738
7,987
5,731
3,813
(122,526)
(31,796)
(8,616)
23,630
(24,169)
113,682
65,402
61,966
39,734
36,644
31,708
30,203
28,725
2,521
(63,736)
(49,036)
(39,838)
(39,734)
(20,246)
(13,883)
(6,043)
(2,314)
-
-
62,073
186,462
20,829
53,119
4,531
27,764
48,511
(106,726)
(26,393)
(19,560)
27,801
(44,737)
171,601
8,324
89,817
-
82,991
-
10,149
12,925
2,551
(164,281)
(28,381)
(149,531)
-
-
-
(12,926)
(2,697)
4,737
(237,700)
(384,022)
106 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 107
Notes to the financial statements
For the year ended 30 June 2023
A About the report
A1
General information
The shares in Centuria Capital Limited, (the Company) and the units in Centuria Capital Fund (CCF) are stapled and trade
together as a single stapled security (Stapled Security) on the ASX as ‘Centuria Capital Group’ (the Group) under the ticker
code CNI.
The Group is a for-profit entity and its principal activities are the marketing and management of investment products
including property investment funds and friendly society investment bonds, as well as co-investments in property
investment funds.
Statement of compliance
The consolidated financial statements are general purpose financial statements which have been prepared in accordance
with Australian Accounting Standards adopted by the Australian Accounting Standards Board (AASB) and the Corporations
Act 2001. The consolidated financial statements comply with International Financial Reporting Standards (IFRS) adopted by
the International Accounting Standards Board (IASB).
The consolidated financial statements of the Group comprising the Company (as Parent) and its controlled entities for the
year ended 30 June 2023 were authorised for issue by the Group’s Board of Directors on 18 August 2023.
Basis of preparation
The consolidated financial statements have been prepared on the basis of historical cost, except for financial assets at fair
value through profit and loss, other financial assets, investment properties and derivative financial instruments which have
been measured at fair value at the end of each reporting period. Cost is based on the fair values of the consideration given
in exchange for assets. All amounts are presented in Australian dollars, which is the company’s functional currency, unless
otherwise noted.
Assets and liabilities have been presented on the face of the statement of financial position in decreasing order of liquidity
and do not distinguish between current and non-current items.
Going concern
The financial report has been prepared on a going-concern basis, which assumes continuity of normal business activities
and the realisation of assets and settlement of liabilities in the ordinary course of business.
Rounding of amounts
The Group is an entity of a kind referred to in ASIC Legislative Instrument 2016/191, related to the ‘rounding off’ of amounts
in the Directors’ Report and financial statements. Amounts in the Directors’ Report and financial statements have been
rounded off, in accordance with the instrument to the nearest thousand dollars, unless otherwise indicated.
A2
Significant accounting policies
The accounting policies and methods of computation in the preparation of the consolidated financial statements are
consistent with those adopted in the previous financial year ended 30 June 2022 with the exception of the adoption of
new accounting standards outlined below or in the relevant notes to the consolidated financial statements.
When the presentation or classification of items in the consolidated financial statements has been amended, comparative
amounts are also reclassified, unless it is impractical. Accounting policies are selected and applied in a manner that
ensures that the resulting financial information satisfies the concepts of relevance and reliability, thereby ensuring that the
substance of the underlying transactions or other events are reported.
These financial statements contain all significant accounting policies that summarise the recognition and measurement
basis used and which are relevant to provide an understanding of the financial statements. Accounting policies that are
specific to a note to the financial statements are described in the note to which they relate.
Notes to the financial statements
Foreign currency transactions
Transactions in foreign currencies are translated into the respective functional currencies of Group companies at the
exchange rate at the dates of the transactions.
Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the
exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign
currency are translated into the functional currency at the exchange rate when the fair value was determined. Non-
monetary items that are measured based on historical cost in a foreign currency are translated at the exchange rate at the
date of the transaction. Foreign currency differences are generally recognised in profit or loss.
However, foreign currency differences arising from the translation of the following items are recognised in Other
Comprehensive Income (OCI):
• a financial liability designated as a hedge of the net investment in a foreign operation to the extent that the hedge is
effective; and
• qualifying cash flow hedges to the extent that the hedges are effective.
Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are
translated into the Australian dollar (AUD) at the exchange rate at the reporting date. The income and expenses of foreign
operations are translated into AUD at the exchange rates at the date of the transactions.
Foreign currency differences arising from the translation of foreign operations are recognised in OCI and accumulated into
the translation reserve, except to the extent that the translation difference is allocated to NCI.
A3
Other new accounting standards and interpretations
The AASB has issued new or amendments to standards that are first effective from 1 July 2022.
The following amended standards and interpretations that have been adopted do not have a significant impact on the
Group’s consolidated financial statements.
Standards now effective:
• AASB 2020-3 Amendments to Australian Accounting Standards - Annual Improvements 2018-2020 and Other
Amendments AASB 2020-3
• AASB 2023-2 Amendments to Australian Accounting Standards - International Tax Reform - Pillar Two Model Rules
Standards not yet effective:
A number of new standards are effective for annual periods beginning after 1 July 2022 and earlier application is permitted;
however, the Group has not early adopted the new or amended standards in preparing these consolidated financial
statements.
The following new and amended standards are not expected to have a significant impact on the Group’s consolidated
financial statements.
• AASB 2020-1 Amendments to Australian Accounting Standards - Classification of Liabilities as Current or Non-current
• AASB 17 Insurance Contracts
• AASB 2020-5 Amendments to Australian Accounting Standards - Insurance Contracts
• AASB 2022-1 Amendments to Australian Accounting Standards - Initial application of AASB 17 and AASB 9 - Comparative
Information
• AASB 2021-2 Amendments to Australian Accounting Standards - Disclosure of Accounting Policies and Definition of
Accounting Estimates
• AASB 2021-5 Amendments to Australian Accounting Standards - Deferred Tax related to Assets and Liabilities arising
from a Single Transaction
• AASB 2021-7(a-c) Amendments to Australian Accounting Standards - Effective Date of Amendments to AASB 10 and
AASB 128 and Editorial Corrections
• AASB 2014-10 Amendments to Australian Accounting Standards - Sale or Contribution of Assets between an Investor and
its Associate or Joint Venture
108 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 109
Notes to the financial statements
Notes to the financial statements
A4
Use of judgements and estimates
In preparing these consolidated financial statements, management has made judgements, estimates and assumptions
that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense
that are not readily apparent from other sources. The judgements, estimates and assumptions are based on historical
experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
Information about critical judgements in applying accounting policies that have the most significant effect on the amounts
recognised in the consolidated financial statements are included in the following notes:
• Note B2 Revenue - performance fees
• Note C6 Intangible assets
• Note F2 Financial instruments
A5
Segment summary
As at 30 June 2023 the Group has six reportable operating segments. These reportable operating segments are the
divisions which report to the Group's Joint Chief Executive Officers and Board of Directors for the purpose of resource
allocation and assessment of performance.
The reportable operating segments are:
Operating segments
Description
Eliminations
Property funds management Management of listed and unlisted property funds.
Co-investments
Direct interest in property funds, properties held for sale and other liquid investments
Developments
Management of development projects and completion of structured property
developments which span sectors ranging from commercial office, industrial, health
through to residential mixed use.
Property and development
finance
Provision of real estate secured non-bank finance for land sub-division, bridging finance,
development projects and residual stock.
Investment bonds
management
Corporate
Management of the Benefit Funds of Centuria Life Limited and management of the Over
Fifty Guardian Friendly Society Limited. The Benefit Funds include a range of financial
products, including single and multi-premium investments.
Overheads for supporting the Group's operating segments and management of a reverse
mortgage lending portfolio.
In addition, the Group also provides disclosures in relation to a further four non-operating segments, which are:
Non-operating segments
Description
Non-operating items
Benefit Funds
Comprises transaction costs, mark-to-market movements in investment, property and
financial instruments, share of equity accounted net profit in excess of distributions
received and all other non-operating activities.
Represents the operating results and financial position of the Benefit Funds of Centuria
Life Limited which are required to be consolidated in the Group’s financial statements in
accordance with accounting standards.
Controlled property funds
Represents the operating results and financial position of property funds which are
managed by the group and consolidated under accounting standards.
The Group's principal activities do not include direct ownership of these funds for the
purpose of measuring control under accounting standards and deriving rental income.
Therefore the results attributable to the controlled property funds are excluded from
operating profit. However, the performance management of the controlled property funds
is included in operating profit, aligned with how performance of the business is assessed
by management of the Group.
Elimination of transactions between the operating segments and the other non-operating
segments above, including transactions between the operating entities within the Group,
the property funds controlled by the Group and the Benefit Funds.
The accounting policies of reportable segments are the same as the Group's accounting policies.
Refer below for an analysis of the Group's segment results:
• Note B1 Segment profit and loss
• Note C1 Segment balance sheet
• Note D1 Operating segment cash flows
110 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 111
Notes to the financial statements
B Business performance
B1
Segment profit and loss
For the year ended 30 June 2023
Management fees
Development revenue
Distribution/dividend revenue
Property performance fees
Property acquisition fees
Interest revenue
Rental income
Underwriting fees
Financing fees
Property sales fees
Other income
Total revenue
Share of net profit of equity accounted investments
Net movement in policyholder liabilities
Mark to market movements of financial instruments
and property
Expenses
Cost of sales
Finance costs
Profit/(loss) before tax
Income tax benefit/(expense)
Profit/(loss) after tax
Profit/(loss) after tax attributable to:
Centuria Capital Limited
Centuria Capital Fund
Profit/(loss) after tax attributable to Centuria Capital
Group securityholders
Non-controlling interests
Profit/(loss) after tax
B2
E1
B3
B4
B4
B5
B6
Property funds
management
$'000
Co-
investments
$'000
Notes
Development
$'000
Property and
development
finance
Non operating
items Benefits funds
Controlled
property funds
142,260
-
-
28,457
14,923
-
204
2,982
975
911
314
-
-
43,474
-
-
4,232
4,988
-
-
-
21
12,919
30,649
-
-
-
-
-
-
-
-
463
5,622
-
-
-
-
2
-
-
6,200
-
-
191,026
52,715
44,033
11,822
-
-
-
-
-
-
-
-
-
-
-
-
Investment
bonds
management
8,605
-
-
-
-
-
-
-
-
-
684
9,289
-
-
-
Corporate
-
-
-
-
-
2,751
-
-
-
-
-
Operating
profit
163,784
30,649
43,474
28,457
14,923
13,068
5,192
2,982
7,175
911
1,021
2,751
311,636
-
-
-
-
-
-
-
67,612
(3,875)
-
-
-
-
8,381
-
-
(5,622)
1,647
-
-
(6,200)
-
-
51,915
4,281
-
-
-
-
160
10,188
-
-
(10,001)
(296)
7,224
(76,301)
(331)
(8,523)
(5,236)
(5,827)
(18,626)
(114,844)
2,985
(4,083)
-
-
(26,093)
(2,160)
(32,996)
112,565
(33,340)
79,225
79,225
-
19,388
(2,155)
17,233
3,468
13,765
79,225
17,233
-
-
79,225
17,233
(3)
9,414
(2,801)
6,613
6,613
-
6,613
-
6,613
-
(5)
6,581
(1,975)
4,606
4,606
-
4,606
-
4,606
-
(1)
3,461
(1,037)
2,424
-
(1,818)
(17,693)
23,180
5,487
(26,093)
(36,983)
133,716
(18,128)
115,588
(67,612)
(1,610)
(10,337)
657
(9,680)
2,424
(65,891)
-
71,378
30,445
85,143
1,832
(11,512)
2,424
-
2,424
5,487
115,588
(9,680)
-
-
-
5,487
115,588
(9,680)
-
-
3,328
(3,328)
-
-
-
-
-
-
Notes to the financial statements
Eliminations Statutory profit
(3,595)
160,189
-
-
-
-
(59)
-
-
-
-
-
98,261
47,980
28,457
14,923
9,046
5,210
2,982
975
911
1,181
-
-
-
-
-
12
18
-
-
-
-
30
(3,654)
370,115
-
-
-
-
-
(4)
26
(2)
24
12
-
12
12
24
-
-
-
4,281
(10,001)
6,928
3,595
(112,347)
-
59
-
-
-
-
-
-
-
-
(93,705)
(38,538)
126,733
(20,801)
105,932
32,289
73,631
105,920
12
105,932
112 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 113
Notes to the financial statements
Notes to the financial statements
Property funds
management
$'000
Co-
investments
$'000
Notes
Corporate
$'000
Operating
profit
$'000
Non operating
items
$'000
Benefits funds
$'000
Controlled
property funds
$'000
Development
$'000
11,447
-
-
73
14,246
-
758
450
-
-
-
898
27,872
-
-
-
Property and
development
finance
$'000
-
-
-
4,592
-
-
2,886
-
-
-
-
307
7,785
-
-
-
Investment
bonds
management
$'000
10,723
-
-
-
-
-
-
-
-
-
-
528
11,251
-
-
-
For the year ended 30 June 2022
Management fees
Property acquisition fees
Property performance fees
Financing fees
Development revenue
Property sales fees
Interest revenue
Rental income
Recoverable outgoings
Distribution/dividend revenue
Underwriting fees
Other income
Total revenue
Share of net profit of equity accounted investments
E1
Net movement in policyholder liabilities
Mark to market movements of financial instruments
and property
Expenses
Cost of sales
Finance costs
Profit/(Loss) before tax
Income tax benefit/(expense)
Profit/(Loss) after tax
Profit/(loss) after tax attributable to:
Centuria Capital Limited
Centuria Capital Fund
B3
B4
B4
B5
B6
124,634
26,850
32,950
1,986
-
2,326
120
-
-
-
3,473
790
-
-
-
-
-
-
1,450
1,272
-
45,515
-
564
193,129
48,801
-
-
-
-
-
-
-
(5,884)
112,406
(33,621)
78,785
78,785
-
(17,765)
30,662
(1,799)
28,863
5,965
22,898
Profit/(loss) after tax attributable to Centuria Capital
Group securityholders
Non-controlling interests
Profit/(loss) after tax
78,785
28,863
-
-
78,785
28,863
-
(12,653)
(7)
6,474
(1,948)
4,526
4,526
-
4,526
-
4,526
-
(5)
4,159
(1,247)
2,912
2,912
-
2,912
-
2,912
-
-
-
-
-
-
3,235
62
-
-
-
474
3,771
-
-
-
146,804
26,850
32,950
6,651
14,246
2,326
8,449
1,784
-
45,515
3,473
3,561
-
-
-
(12,653)
(26,057)
-
-
-
(4,592)
-
-
(2,886)
-
-
-
-
-
-
-
-
430
-
-
(2,706)
6,541
-
41
7,012
-
16,514
-
(2,818)
7,101
-
237
-
(1,063)
(167,087)
(24,848)
292,609
(13,002)
Eliminations
$'000
Statutory profit
$'000
(6,439)
140,365
-
-
-
-
-
(59)
-
-
(4,212)
-
-
26,850
32,950
2,059
14,246
2,326
5,936
20,055
5,402
45,138
3,473
916
-
-
-
-
-
-
2
18,271
5,402
-
-
132
23,807
(10,710)
299,716
-
-
32
-
-
7,101
16,514
1,519
(190,384)
-
(11)
4,547
(1,135)
3,412
-
(2,385)
(20,790)
16,802
(3,988)
137,458
(173,814)
(22,948)
12,793
114,510
(161,021)
3,412
(53,393)
-
49,405
42,207
72,303
(21,570)
(139,451)
3,412
(3,988)
114,510
(161,021)
-
-
-
-
3,412
(3,988)
114,510
(161,021)
(5,429)
(7,199)
6,172
(122,660)
-
(2)
(6,753)
6,753
-
-
-
-
-
-
-
(2,779)
13,861
-
-
(1,692)
(4,711)
-
13,861
(4,711)
(12,653)
(31,593)
(33,959)
(3,402)
(37,361)
-
-
20,637
13,370
(4,711)
(58,489)
13,370
(4,711)
(37,852)
491
13,861
-
491
(4,711)
(37,361)
(74,839)
(374)
(8,738)
(3,621)
(6,693)
(22,176)
(116,441)
114 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 115
Notes to the financial statements
B2
Revenue
Revenue has been disaggregated in the segment profit and loss in Note B1.
(a) Recognition and measurement
Type of revenue
Description
Revenue
recognition policy
Management
fees
The Group provides:
a. fund management services to property funds in accordance with the fund
Over-time
constitutions. The services are provided on an ongoing basis and revenue is
calculated and recognised in accordance with the relevant constitution. The fees
are primarily calculated based on a fixed percentage of a defined metric or a fixed
amount. The fees are invoiced and paid monthly in arrears.
b. property management services to the owners of property assets in accordance
with property services agreements. The services are utilised on an ongoing
basis and revenue is calculated and recognised in accordance with the specific
agreement. The fees are primarily calculated based on a fixed percentage of a
defined metric or a fixed amount. The fees are invoiced monthly with variable
payment terms depending on the individual agreements.
Over-time
c. lease management services to the owners. The revenue is recognised when
Point-in-time
the specific service is delivered (e.g. on lease execution) and consideration is
due 30 days from invoice date. The fees are primarily calculated based on a fixed
percentage of a defined metric or a fixed amount.
d. development management services to the owners of property assets in
Over-time
accordance with development management agreements. Revenue is calculated
in accordance with the specific agreement and invoiced in accordance with
the contract terms with revenue recognised progressively as the services
are provided in proportion to the state of completion by reference to costs.
Consideration is due from the customer based on the specific terms agreed in the
contract and is recognised when the Group has control of the benefit.
Distribution/
dividend revenue
Distribution/dividend revenue from investments is recognised when the
shareholder has a right to receive payment.
Interest revenue
Interest revenue is accrued on an over-time by reference to the principal
outstanding using the effective interest rate.
Point-in-time
Over-time
Rental income
Finance work
fees
Performance
fees
Rental income from investment property is recognised in profit or loss on a straight
line basis over the term of the lease.
Over-time
Liquidity management services to property funds in accordance with the fund
constitutions. The revenue is recognised when the specific service is delivered
(e.g. on facility execution) and consideration is due 30 days from invoice date. The
fees are primarily calculated based on a fixed percentage of the facility amount.
Point-in-time
The Group receives a performance fee for providing management services where
the property fund outperforms a set internal rate of return (IRR) benchmark at
the time the property is sold. Consideration is due upon successful sale of the
investment property if the performance hurdles are satisfied.
Over-time
In measuring the performance fees to be recognised each period, consideration
is given to the facts and circumstances with respect to each investment property
including external factors such as its current valuation, passage of time and outlook
of the property market.
Performance fees are only recognised when they are deemed to be highly probable
and the amount of the performance fees will not result in a significant reversal in
future periods.
The Group’s performance fees are recognised over-time under AASB 15 Revenue
from Contracts with Customers.
Type of revenue
Description
Performance
fees continued
The key assumptions made in estimating the amount of performance fee revenue
that is highly probable include:
Revenue
recognition policy
Over-time
Notes to the financial statements
>2 years from forecast fund end date:
It is assumed that the highly probable threshold is only met when the forecast end
date of the fund is within two years from balance date. The forecast end date is
generally based on the relevant fund end date as expressed in the relevant PDS or a
revised fund end date in the event that an alternative strategy is undertaken by the
Group, in which case the unbooked portion of any forecast performance fees are
recognised over the extended term of the fund. In instances where the fund term
is extended beyond two years from the reporting date and the Group has already
accrued a performance fee in prior periods, the Group will continue to accrue any
additional fee over the extended remaining period.
Probability thresholds for sensitivity to property valuations:
The level of constraint applied to performance fee revenue is adjusted depending
on remaining fund tenure. Specifically, a discount in property values between
10.0% to 20.0% is applied, depending on when in the two-year window the fund
is expected to wind up. In instances where the fund term is extended beyond two
years from the reporting date and the Group has already accrued a performance fee
in prior periods, a discount in property values between 2.5% to 10.0% is applied
depending on the remaining fund term as it is assumed the fund term extension
was on the basis that fund performance can be further enhanced, thereby reducing
the risk of valuation decrements and increasing the likelihood of achieving the full
performance fee.
Fair value of investment properties:
The fair value of investment properties is based on the latest available valuation of
the underlying property from the published financial statements or board approved
valuations.
The Group recovers the costs associated with general building and tenancy
operation from lessees in accordance with specific clauses within lease
agreements. These are invoiced monthly based on an annual estimate. The
consideration is due 30 days from invoice date. Should any adjustment be required
based on actual costs incurred, this is recognised in the statement of financial
performance within the same reporting period and billed annually.
The Group provides property acquisition related services to property funds and the
revenue is based on a fixed percentage of a defined metric included in the PDS
issued at the establishment of the fund. The consideration is due upon successful
settlement of the investment property.
The Group provides sales services to the owners of property assets in accordance
with property management agreements and the revenue is based on a fixed
percentage of a defined metric included in the relevant property management
agreement. The consideration is due upon successful sale of the investment
property.
Over-time
Point-in-time
Point-in-time
Recoverable
outgoings
Property
acquisition fees
Property sales
fees
Development
revenue
Where the Group has control of the underlying asset, revenue from the sale of
development assets is recognised when control has been transferred to the
customer.
Over-time
Where development assets have been recognised in relation to the enhancement
of an asset controlled by the customer, revenue from the realisation of the
development costs are recognised over time in accordance with the performance
obligations of the contract and in proportion to the stage of completion of the
relevant contracts by reference to costs. Any variable consideration is constrained
to the amount that is highly probable to not significantly reverse. Proceeds from
the sale of development assets are invoiced and receivable in accordance with the
relevant terms of the contract.
116 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 117
Notes to the financial statements
Notes to the financial statements
(b) Transaction price allocated to the remaining performance obligations
The following table represents additional information not required by accounting standards of revenue expected to be
recognised in the future relating to performance conditions that are unsatisfied (or partially unsatisfied) at period end.
These amounts represent the unconstrained values of expected future revenue.
Property performance fees1
Development revenue2
Management fees3
Recognised in
2023
$'000
28,457
30,649
34,215
Balance of
unrecognised
performance
obligations 2023
$'000
125,996
63,698
120,268
Recognised in
2022
$'000
32,950
14,246
57,822
Balance of
unrecognised
performance
obligations 2022
$'000
179,273
25,954
75,999
1. The underlying property funds managed by the Group have total estimated performance fees payable of $185,500,000 as at 30 June 2023 (30 June
2022: $215,081,000) based on the current financial performance of the underlying property funds. These represent an estimate of the total expected
performance fee revenue due to the Group from the property funds over their remaining lives. Of these performance fees, the Group has recognised
$28,457,000 in FY23, with $29,742,000 recognised in prior years. The total estimated amount of performance fees available to the Group to recognise in
the future is $125,996,000 (30 June 2022: $179,273,000).
These amounts are expected to be recognised in future periods based on expected fund expiries which range up to FY30. Unrecognised performance
fees are based on current property valuations and anticipated fund expire dates and as a result may not be fees that will eventuate upon actual
Fund expiry. Further, these amounts may not be in line with the point performance fees recognition will normally be triggered based on the Group’s
accounting policy outlined in B2(a) i.e. amounts disclosed are not constrained to represent the amount of future revenue that is highly probable of not
being realised.
2. Relates to property development contracts where the Group is acting as developer and is based on contracted revenue. The Group expects to recognise
the revenue in the coming 12 months as the development activity is completed.
3. Relates only to unlisted property funds management fees which have a defined fund life. The amount is an estimated amount based on the 30 June
2023 balance of defined metrics or fixed amount as set out in the Group’s accounting policy outlined in B2(a). The Group expects to recognise the
revenue over the next seven years. As defined metrics are primarily driven by property valuations, the unrecognised management fees may not be fees
that will eventuate over the life of the fund.
(c) Transactions with related parties
Management fees are charged to related parties in accordance with the respective trust deeds and management
agreements.
Management fees from Property Funds managed by Centuria
155,178,975
134,751,000
2023
$'000
2022
$'000
Development revenue from Property Funds managed by Centuria
Distributions from Property Funds managed by Centuria
Performance fees from Property Funds managed by Centuria
Property acquisition fees from Property Funds managed by Centuria
Development management fees from property funds managed by Centuria
Fees from Debt funds managed by Centuria
Interest from Debt Funds managed by Centuria
Management fees from Over Fifty Guardian Friendly Society
Underwriting fees in relation to Property Funds managed by Centuria
Interest income on loans to Property Funds managed by Centuria
Sales fees from Property Funds managed by Centuria
Interest income on loan to Bass Property Credit Fund
Interest income on loan to Centuria Bass Credit Fund
61,763,557
37,174,386
28,456,851
14,923,473
12,918,642
6,199,936
5,622,451
3,372,860
2,982,378
2,721,891
910,504
589,705
98,533
14,246,374
38,597,343
32,950,250
26,850,177
11,446,854
4,898,751
2,885,503
3,618,246
3,472,595
1,381,964
2,326,011
-
-
332,914,142
277,425,068
B3 Mark to market movements of financial instruments and property
The following table provides a summary of fair value and impairment movements of investments during the year.
Movement in Centuria Industrial REIT's listed market price
Movement in Centuria Office REIT's listed market price
Movement in Healthcare put/call option
Impairment of Inventory
Other mark to market movements
Total mark to market movement
B4
Expenses
Cost of sales - development
Employee benefits expense
Depreciation Expense
Insurance costs
Property management fees paid
Superannuation contribution expense
Consulting and professional fees
Information Technology expenses
Administration fees
Transaction costs
Property outgoings and fund expenses
Acquisition fee rebates expense
Claims - discretionary participation features
Other expenses
2023
$'000
29,317
(29,993)
10,440
(5,630)
2,794
6,928
2023
$'000
93,705
75,419
5,596
5,404
4,050
4,253
3,254
2,886
1,789
1,631
-
-
-
8,065
206,052
2022
$'000
(101,599)
(56,719)
(26,005)
(3,989)
(2,072)
(190,384)
2022
$'000
12,653
72,031
4,179
5,000
4,594
3,379
5,109
3,359
3,278
3,652
5,393
1,360
165
11,161
135,313
(a) Transactions with key management personnel
1. Director remuneration
The aggregate remuneration paid to directors of the Group is set out below:
Board and Committee fees
2023
$'000
2022
$'000
1,289,600
1,279,810
Detailed information on directors remuneration is included in Audited Remuneration Report on page 74.
2. Key management personnel compensation
The aggregate compensation paid to key management personnel of the Group is set out below:
Terms and conditions of transactions with related parties
Investments in property funds and Benefit Funds held by certain directors and director-related entities are made on the
same terms and conditions as all other investors and policyholders. Directors and director-related entities receive the
same returns on these investments as all other investors and policyholders.
The Group pays some expenses on behalf of related entities and receives a reimbursement for those payments. As at 30
June 2023, the amount receivable from related parties per note C2(a) is $21,045,276.
Short-term employee benefits
Post-employment benefits
Other long-term employment benefits
Share-based payments
2023
$'000
9,150,494
153,957
62,943
2,674,979
12,042,373
2022
$'000
9,678,084
160,976
138,167
2,796,274
12,773,501
118 | Centuria Capital Group – Annual Report 2023
Detailed information on key management personnel compensation is included in the Audited Remuneration Report on
page 74.
Centuria Capital Group – Annual Report 2023 | 119
Notes to the financial statements
B5
Finance costs
Group interest charges
Finance charge - puttable instruments
Reverse mortgage facility interest charges
Lease interest
Fair value loss on financial assets
Fair value gain on derivatives
Bank loans in Controlled Property Funds interest charges
Other finance costs
2023
$'000
33,025
2,146
1,754
1,613
277
(277)
-
-
38,538
Recognition and measurement
The Group's finance costs include interest expense recognised using the effective interest rate method.
B6
Taxation
Current tax expense in respect of the current year
Adjustments to current tax in relation to prior years
Deferred tax expense/(benefit) relating to the origination and reversal
of temporary differences
Adjustments to deferred tax in relation to prior years
Income tax expense
2023
$'000
4,235
2,552
6,787
17,060
(3,046)
20,801
2022
$'000
18,112
5,884
1,999
1,069
14,503
(14,503)
2,779
1,750
31,593
2022
$'000
23,877
(1,117)
22,760
(18,468)
(890)
3,402
(a) Reconciliation of income tax expense
The prima facie income tax expense on profit before income tax reconciles to the income tax expense in the consolidated
financial statements as follows:
Profit/(loss) before tax
Less: (profit)/loss not subject to income tax
Income tax expense calculated at 30%
Add/(deduct) tax effect of amounts which are not deductible (assessable)
Tax offsets
Non-allowable expenses - other
Adjustments to income tax expense in relation to prior years
Effects of different tax rates of subsidiaries operating in other
jurisdictions
Income tax expense
2023
$'000
126,733
(63,054)
63,679
19,104
(1,217)
1,000
2,552
(638)
20,801
2022
$'000
(33,959)
45,172
11,213
3,364
(301)
1,415
(1,117)
41
3,402
(b) Current tax assets and liabilities
The prima facie income tax expense on profit before income tax reconciles to the income tax expense in the consolidated
financial statements as follows:
Notes to the financial statements
CURRENT TAX ASSETS/(LIABILITIES) ATTRIBUTABLE TO
Income tax receivable/(payable) - Australia1
Income tax payable to benefit fund policy holders - Australia
2023
$'000
4,988
(600)
4,388
2022
$'000
534
(1,150)
(616)
1. The prior period tax receivable in Australia has been amended to reflect purchase price adjustments of $3,300,000 that had been recorded as a tax
receivable and should have been recorded as part of the purchase price consideration. The Goodwill as at 30 June 2022 had a corresponding impact
increasing by $3,300,000.
(c) Movement of deferred tax balances
NET DEFERRED TAX ASSETS/(LIABILITIES) ATTRIBUTABLE TO
Deferred tax liabilities - Australia
Deferred tax assets - New Zealand
2023
$'000
20221
$'000
(66,307)
8,637
(57,670)
(52,601)
7,085
(45,516)
1. We have restated the prior year to present deferred tax assets and liabilities on a net basis due to the gross assets and liabilities being with the same
counterparty.
Financial year ended 30 June 2023
Opening balance
Movement
$'000
Closing balance
$'000
DEFERRED TAX ASSETS
Provisions
Transaction costs
Capital losses
Financial derivatives
Revenue tax losses
Property held for development
Right of use asset/Lease liability
Equity accounted investment
DEFERRED TAX LIABILITIES
Indefinite life management rights
Accrued performance fees
Accrued income
Unrealised foreign exchange gains
Unrealised loss/(gain) on financial assets
Other
Net deferred tax liabilities
2,865
4,582
23,313
11,353
1,541
5,714
115
523
50,006
(86,678)
(11,534)
(408)
-
3,492
(394)
(95,522)
(45,516)
1,933
(1,445)
(220)
(2,129)
4,328
(1,913)
379
-
933
-
(5,541)
-
(1,263)
(6,184)
(99)
(13,087)
(12,154)
4,798
3,137
23,093
9,224
5,869
3,801
494
523
50,939
(86,678)
(17,075)
(408)
(1,263)
(2,692)
(493)
(108,609)
(57,670)
The tax rate used in the above reconciliation is the corporate tax rate of 30% payable for Australian corporate entities
on taxable profits under Australian tax law. There has been no change in the corporate tax rate when compared with the
previous reporting period. Taxable income derived for New Zealand tax purposes is at the tax rate of 28%.
During the current year, the net deferred tax liabilities increased by $12,154,000, of which $1,263,000 was recognised
directly in equity and $14,014,000 was recognised in deferred tax expense, offset by $3,123,000 recognised in current tax
benefit.
120 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 121
Notes to the financial statements
Notes to the financial statements
Financial year ended 30 June 2022
Opening balance
Movement
$'000
Closing balance
$'000
DEFERRED TAX ASSETS
Provisions
Transaction costs
Capital losses
Financial derivatives
Revenue tax losses
Property held for development
Right of use asset/Lease liability
Equity accounted investment
Other
Deferred tax liabilities
Indefinite life management rights
Accrued performance fees
Accrued income
Unrealised loss/(gain) on financial assets
Other
Net deferred tax liabilities
3,498
4,387
24,781
2,319
2,943
3,942
48
523
85
42,526
(86,678)
(6,345)
(352)
(6,794)
(403)
(100,572)
(58,046)
(633)
195
(1,468)
9,034
(1,402)
1,772
67
-
(85)
7,480
-
(5,189)
(56)
10,286
9
5,050
12,530
2,865
4,582
23,313
11,353
1,541
5,714
115
523
-
50,006
(86,678)
(11,534)
(408)
3,492
(394)
(95,522)
(45,516)
Recognition and measurement
Income tax expense represents the sum of the tax currently payable and payable on a deferred basis.
1. Current tax
The tax currently payable is based on taxable income for the year. Taxable income differs from profit as reported in the
consolidated profit or loss because of items of income or expense that are assessable or deductible in other years as well
as items that are never assessable or deductible. The Group's liability for current tax is calculated using tax rates that have
been enacted or substantively enacted by the end of the reporting period.
2. Deferred tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities and the
corresponding tax bases.
Deferred tax liabilities are generally recognised for all assessable temporary differences. Deferred tax assets are
recognised for all deductible temporary differences, unused tax losses and tax offsets, to the extent that it is probable that
sufficient future taxable profits will be available to utilise them.
However, deferred tax assets and liabilities are not recognised for:
• assessable temporary differences that arise from the initial recognition of assets or liabilities in a transaction that is not a
business combination which affects neither taxable income nor accounting profit;
• assessable temporary differences relating to investments in subsidiaries, associates and joint ventures to the extent that
the Group is able to control the timing of the reversal of the temporary differences and it is probable that they will not
reverse in the foreseeable future; and
• assessable temporary differences arising from goodwill
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that
it is no longer probable that sufficient taxable income will be available to allow all or part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is
settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of
the reporting period. The applicable rates are 30% for deferred tax assets and liabilities arising to the Australian subsidiaries
of the Company and 28% for deferred tax asset and liabilities arising to the New Zealand subsidiaries of the Company. The
measurement of deferred tax assets and liabilities reflects the tax consequences that would follow from the manner in which
the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against
current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to
settle its current tax assets and liabilities on a net basis.
3. Tax consolidation
The Company and all its wholly-owned Australian resident subsidiaries are part of a tax consolidated group under Australian
taxation law. The Company is the head company of the tax consolidated group. Tax expense/benefit, deferred tax assets
and deferred tax liabilities arising from temporary differences of the members of the tax consolidated group are recognised
in their separate financial statements using a 'standalone taxpayer' approach. Under the tax funding agreement between
members of the tax consolidated group, amounts are recognised as payable to or receivable by each member in relation to
the tax contribution amounts paid or payable between the Company and the members of its tax consolidated group.
The Benefit Funds are part of the tax consolidated group, and they are allocated a share of the income tax liability
attributable to Centuria Life Limited equal to the income tax liability that would have arisen to the Benefit Funds had they
been stand-alone entities.
Centuria Capital Fund ('CCF') and its sub-trusts are not part of the tax consolidated group. Under current Australian income
tax legislation, trusts are not liable for income tax, provided their securityholders are presently entitled to the net (taxable)
income of the trust including realised capital gains, each financial year.
From 19 July 2021, Centuria WA Pty Limited (Centuria WA Group) and its wholly-owned subsidiaries, formerly known as
Primewest Group Limited, formed part of the Company's consolidated tax group as a result of the Company acquiring 100%
interest in Centuria WA Group in accordance with Australian tax legislation.
Centuria Healthcare Pty Ltd ('Centuria Healthcare') is not a wholly-owned subsidiary of the Company at 30 June 2023.
Centuria Healthcare has its own tax consolidated group with its wholly-owned subsidiaries for the full year. Centuria
Healthcare is the head company of the Centuria Healthcare tax consolidated group. Tax expense/benefit, deferred tax
assets and deferred tax liabilities arising from temporary differences of the members of the tax consolidated group are
recognised in their separate financial statements using a 'standalone taxpayer' approach. Under the tax funding agreement
between members of the tax consolidated group, amounts are recognised as payable to or receivable by each member
in relation to the tax contribution amounts paid or payable between Centuria Healthcare and the members of its tax
consolidated group.
The New Zealand tax resident subsidiaries of the Company are all stand-alone taxpayers from a New Zealand income tax
perspective as they have not elected to form a consolidated group for New Zealand tax purposes.
4. Current and deferred tax for the period
Income taxes relating to items recognised directly in equity are recognised directly in equity and not in the statement of
comprehensive income. In the case of a business combination, the tax effect is included in the accounting for the business
combination.
B7
Earnings/(losses) per security
EARNINGS/(LOSSES) PER CENTURIA CAPITAL GROUP SECURITY
Basic (cents per share)
Diluted (cents per share)1
EARNINGS PER CENTURIA CAPITAL LIMITED SHARE
Basic (cents per share)
Diluted (cents per share)
1. As the Group was in a statutory loss in 2022, the Diluted EPS is equal to Basic EPS.
2023
cents
13.3
13.1
4.0
3.9
2022
cents
(4.8)
(4.8)
2.6
2.6
The earnings/(losses) used in the calculation of basic and diluted earnings/(losses) per security is the profit/(loss)
for the year attributable to Centuria Capital Group securityholders as reported in the consolidated statement of
comprehensive Income.
122 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 123
Notes to the financial statements
Notes to the financial statements
The weighted average number of ordinary securities used in the calculation of basic and diluted earnings per security is as
follows:
Weighted average number of ordinary securities (basic)
Weighted average number of ordinary securities (diluted)1
2023
$'000
797,325,988
808,051,046
2022
$'000
791,188,235
800,319,140
1. The weighted average number of ordinary securities used in the calculation of diluted earnings per security is determined as if 30 June 2023 was
the end of the performance period of the grants of Rights under the LTI Plan. All Rights that would have vested if 30 June 2023 was the end of the
performance period are deemed to have been issued at the start of the financial year.
B8
Dividends and distributions
2023
2022
Cents per security
Total
$'000 Cents per security
Total
$'000
DIVIDENDS/DISTRIBUTIONS PAID DURING THE YEAR
Final year-end dividend (fully franked)
Final year-end distribution
Interim dividend (fully franked)
Interim distribution
DIVIDENDS/DISTRIBUTIONS DECLARED DURING THE YEAR
Final dividend (fully franked)1
Final distribution1
0.90
4.60
1.20
4.60
0.50
5.30
7,114
36,363
9,557
36,634
3,999
42,389
2.10
3.40
1.20
4.30
0.90
4.60
12,605
20,408
9,482
33,977
7,114
36,363
1. The Group declared a final dividend/distribution in respect of the year ended 30 June 2023 of 5.8 cents per stapled security which included a fully
franked dividend of 0.5 cents per share and a trust distribution of 5.3 cents per unit. The final dividend/distribution had a record date of 30 June 2023
and payable on 18 August 2023. The total amount payable of $46,388,000 (2022: $43,477,000) has been provided for as a liability in these financial
statements.
(a) Franking credits
Amount of franking credits available to shareholders of the Company1
1. Before taking into account the impact of the final dividend payable on 18 August 2023.
2023
$'000
21,173
2022
$'000
9,447
Of the franking credit balance of $21,173,000 at 30 June 2023, $16,169,000 relates to the Centuria Capital Limited tax
consolidated group and $5,004,000 relates to the Centuria Healthcare tax consolidated group.
124 | Centuria Capital Group – Annual Report 2023
UNLISTED: ALLENDALE SQUARE, PERTH WA
Centuria Capital Group – Annual Report 2023 | 125
Notes to the financial statements
C Assets and liabilities
C1
Segment balance sheet
As at 30 June 2023
Assets
Cash and cash equivalents
Receivables
Income tax receivable
Financial assets
Other assets
Inventory
Deferred tax assets
Equity accounted investments
Right of use asset
Intangible assets
Total assets
Liabilities
Payables
Provisions
Borrowings
Provision for income tax
Interest rate swap at fair value
Benefit Funds policy holders' liability
Deferred tax liability
Call/Put option liability
Lease liability
Total liabilities
Net assets
Notes
D2
C2
B6(b)
C3
C5
B6(c)
E1
C10
C6
C7
C8
B6(b)
B6(c)
C9
C10
Notes to the financial statements
Property funds
management
$'000
Co-investments
$'000
Development
$'000
Property and
development
finance
$'000
Investment bonds
management
$'000
Corporate
$'000
Operating
balance sheet
$'000
Benefits funds
$'000
Controlled
property funds
$'000
Eliminations
$'000
Statutory balance
sheet
$'000
69,999
86,227
337
-
233
-
8,637
-
10,810
793,072
969,315
27,451
3,024
-
-
-
-
81,863
-
10,949
123,287
846,028
58,263
11,445
-
672,363
-
65,765
294
61,547
-
-
1,838
23,750
-
-
24
16,918
4,386
2,973
-
-
-
-
-
-
-
-
-
26,162
-
-
10,138
826
-
-
47
-
-
-
-
-
39,137
7,027
4,651
41,887
12,410
-
12,492
-
21,780
179,375
129,275
4,988
714,250
12,714
82,683
25,809
90,682
32,590
-
793,072
45,394
3,699
-
233,009
-
-
-
-
-
-
691
39
-
-
-
6,025
-
-
-
-
-
265
-
(7,526)
-
-
(17,172)
-
-
-
225,460
133,278
4,988
939,733
12,714
88,708
8,637
90,682
32,590
793,072
869,677
49,889
26,162
11,011
139,384
2,065,438
282,102
6,755
(24,433)
2,329,862
47,778
-
375,504
-
-
-
-
-
-
7,348
-
-
-
-
-
-
-
-
423,282
446,395
7,348
42,541
-
-
-
-
-
-
-
-
-
-
26,162
1,965
-
-
-
-
-
614
-
-
2,579
8,432
5,904
2,395
3,859
-
90,446
5,419
379,363
-
19,339
19,339
-
-
38,255
24,776
94,528
44,856
-
82,477
38,255
35,725
651,024
1,414,414
1,972
-
-
335
-
278,793
1,002
-
-
282,102
-
-
-
-
-
-
-
-
-
-
-
6,755
-
-
(4,146)
265
-
-
(17,172)
-
-
92,418
5,419
375,217
600
19,339
278,793
66,307
38,255
35,725
(21,053)
(3,380)
912,073
1,417,789
126 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 127
Notes to the financial statements
Notes to the financial statements
As at 30 June 2022
Assets
Cash and cash equivalents
Receivables
Income tax receivable
Financial assets
Other assets
Investment properties
Inventory
Deferred tax assets2
Equity accounted investments
Right of use asset
Intangible assets
Total assets1
Liabilities
Payables
Provisions
Borrowings
Provision for income tax
Interest rate swap at fair value
Benefit Funds policy holders' liability
Deferred tax liability2
Call/Put option liability
Lease liability
Total liabilities
Net assets
Notes
D2
C2
B6(b)
C3
C4
C5
B6(c)
E1
C10
C6
C7
C8
B6(b)
B6(c)
C9
C10
Property funds
management
$'000
Co-investments
$'000
Development
$'000
Property and
development
finance
$'000
Investment bonds
management
$'000
Corporate
$'000
Operating
balance sheet
$'000
Benefits funds
$'000
Controlled
property funds
$'000
Eliminations
$'000
Statutory balance
sheet
$'000
94,123
72,451
-
-
-
-
-
7,085
-
-
791,521
965,180
35,549
3,002
-
2,620
-
-
77,512
-
-
118,683
846,497
11,763
14,034
-
726,579
-
-
88,712
1,182
49,117
-
-
39,313
10,250
-
-
-
-
40,690
4,476
-
-
-
-
-
-
-
-
-
-
-
25,765
-
-
7,616
388
-
-
63
-
-
98
-
-
-
32,184
8,818
3,549
38,008
9,909
-
-
17,448
-
17,006
-
184,999
105,941
3,549
764,587
9,972
-
129,402
30,289
74,882
17,006
791,521
9,503
4,187
-
257,328
-
-
-
1,707
-
-
-
6,063
3,359
-
31
-
337,500
5,648
-
-
-
-
-
-
-
(60,254)
-
-
(267)
(24,911)
(113)
-
-
200,565
113,487
3,549
961,692
9,972
337,500
134,783
7,085
74,769
17,006
791,521
891,387
94,729
25,765
8,165
126,922
2,112,148
272,725
352,601
(85,545)
2,651,929
61,835
-
436,705
-
-
-
-
-
-
6,353
-
-
-
-
-
-
-
-
498,540
392,847
6,353
88,376
-
-
-
-
-
-
-
-
-
-
25,765
2,832
-
-
-
-
-
-
-
-
2,832
5,333
19,549
2,111
3,606
395
18,750
-
-
48,695
19,443
112,549
14,373
126,118
5,113
440,311
3,015
18,750
1,018
-
-
1,150
-
-
270,557
-
-
-
77,512
48,695
19,443
738,957
1,373,191
7,677
-
190,239
-
-
-
-
-
-
(194)
-
(1,165)
-
-
-
(24,911)
35,400
-
9,130
(94,675)
134,619
5,113
629,385
4,165
18,750
270,557
52,601
84,095
19,443
1,218,728
1,433,201
272,725
-
197,916
154,685
1. See note C6 for details in relation to the prior period restatement within assets.
2. Prior year numbers have been represented to reflect current year presentation.
128 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 129
Notes to the financial statements
C2
Receivables
Receivables from related parties
Other receivables
Contract assets - development
Notes
C2(a)
2023
$'000
110,624
21,498
1,156
133,278
2022
$'000
92,342
21,047
98
113,487
C3
Financial assets
Investment in related party unit trusts at fair value
Investments in trusts, shares and other financial instruments at fair value
Loans receivable from related parties1
Reverse mortgage receivables2
Notes
C3(a)
C3(b)
Notes to the financial statements
2023
$'000
637,537
215,149
45,160
41,887
2022
$'000
608,729
242,834
70,045
40,084
939,733
961,692
All receivables are current except for $36,500,000 (2022: $11,013,000) of performance fees receivable which are non-
current. These are located in Note C2(a).
The Group does not hold any collateral or other credit enhancements over these balances nor does it have a legal right of
offset against any amounts owed by the Group to the counterparty.
(a) Receivables from related parties
The following amounts were owed by related parties of the Group at the end of the financial year:
Performance fees owing from property funds managed by Centuria
Development revenue from property funds managed by Centuria
Recoverable expenses owing from property funds managed by Centuria
Management fees owing from property funds managed by Centuria
Distribution receivable from Centuria Industrial REIT
Distribution receivable from Centuria Office REIT
Deposits receivable from property funds managed by Centuria
Distribution receivable from unlisted property funds managed by Centuria
Sales fees owing from property funds managed by Centuria
2023
$'000
60,381,343
6,054,148
21,045,276
13,352,737
4,045,118
3,211,042
1,314,069
1,220,648
-
2022
$'000
35,863,456
1,497,692
15,328,214
26,216,186
4,373,677
3,780,375
3,757,900
1,238,847
286,032
1. The loan receivable from Centuria NZ Healthcare Property Fund accrues interest at 4.75% per annum and does not have an expiry date.
2. Whilst some mortgages are likely to be repaid during the next 12 months, the Group does not control the repayment date.
Financial assets are classified as non-current assets as the Group is not intending to dispose of financial assets within the
next twelve months.
(a) Investments in related party unit trusts carried at fair value through profit or loss
The following table details related party investments carried at fair value through profit and loss.
2023
2022
Fair value
$
Units held Ownership
Fair value
$
Units held Ownership
FINANCIAL ASSETS HELD BY THE GROUP
Centuria Industrial REIT
313,393,790
101,094,771
15.92% 284,076,307
101,094,771
15.92%
Centuria Office REIT
124,797,913
91,093,367
15.25%
154,858,724
91,093,367
15.25%
Centuria NZ Industrial Fund
35,813,852
25,015,037
10.00%
39,932,013
25,015,037
10.00%
Centuria Healthcare Direct Medical
Fund No.2
23,423,708
18,673,473
12.04% 25,483,689
18,673,473
12.04%
Prime Healthcare Holding Trust
22,347,535
22,392,320
10.00% 21,500,000
21,500,000
10.00%
110,624,381
92,342,379
Asset Plus Limited
17,627,919
72,507,288
19.99%
17,329,033
72,507,288
19.99%
The ageing of receivables from the related parties of the Group at the reporting date was as follows:
Not due
1 to 30 days
31 to 60 days
>60 days overdue
2023
$'000
97,433
4,862
4,062
4,267
110,624
2022
$'000
79,108
9,089
1,652
2,493
92,342
As at 30 June 2023, the Group had $13,191,000 receivables from related parties (2022: $13,234,000) past due but not
impaired.
Collectability of the receivables from related parties is reviewed on an ongoing basis. Debts which are known to be
uncollectible are written off in the year in which they are identified. A provision for expected credit losses is processed
based on historical default percentages and current observable data including forecasts of economic conditions. The
amount of the provision is the difference between the carrying amount and estimated future cash flows.
Recognition and measurement
Receivables are initially recognised at fair value and subsequently at amortised cost using the effective interest rate
method, less an allowance for impairment. Due to the short-term nature of these financial rights, their carrying amounts are
estimated to represent their fair values.
1. Contract assets - development
The timing of revenue recognition, billings and cash collections results in billed accounts receivable (trade receivables)
and unbilled receivables (contract assets) on the consolidated statement of financial position.
Centuria NZ Property Fund
16,922,848
19,986,894
19.98%
5,224,905
5,000,000
6.27%
Matrix Trust
13,435,129
12,803,849
5.00%
11,092,900
9,313,938
5.00%
Centuria 111 St Georges Terrace Fund
13,155,329
3,485,539
18.06%
-
-
0%
Dragon Hold Trust
13,135,312
969,622,257
10.00%
9,696,223
969,622,257
10.00%
Centuria NZ Healthcare Property
Fund
Centuria Wholesale Agricultural Trust
No. 21
6,524,916
8,780,442
12.43%
4,997,192
5,734,989
13.15%
4,659,877
4,324,000
12.64%
6,775,000
6,775,000
19.81%
Centuria Penrose Limited
3,792,925
4,445,471
3.74%
-
-
0%
Pialba Place Trust
3,660,653
5,129,345
23.32%
4,375,331
5,129,345
23.32%
Centuria Industrial Income Fund No.2
3,563,945
3,563,945
15.88%
-
-
0%
Centuria Healthcare Aged Care
Property Fund No.1
Centuria Government Income
Property Fund
Centuria ATP Fund
251 St Georges Terrace Trust
Centuria 25 Grenfell Street Fund
Centuria Large Format Retail Trust
No. 22
3,599,019
5,513,559
9.21%
2,954,165
5,513,559
9.21%
662,845
643,539
0.48%
643,539
643,539
0.64%
226,864
116,000
42,811
104,545
100,000
40,010
0.17%
0.26%
0.08%
-
101,300
40,010
-
0%
100,000
0.26%
40,010
0.08%
-
-
0%
3,407,301
3,097,546
7.29%
620,903,190
592,487,632
130 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 131
Notes to the financial statements
Notes to the financial statements
2023
2022
Recognition and measurement
FINANCIAL ASSETS HELD BY THE BENEFIT FUNDS
Fair value
$
Units held Ownership
Fair value
$
Units held Ownership
All financial assets are recognised and derecognised on trade date where the purchase or sale of a financial asset is under
a contract whose terms require delivery of the financial asset within the timeframe established by the market concerned.
Financial assets are initially measured at fair value plus transaction costs, except for those financial assets classified as at
fair value through profit or loss (FVTPL), which are initially measured at fair value only.
Centuria Office REIT
9,269,857
6,766,319
1.13%
11,502,742
6,766,319
1.32%
Centuria Industrial REIT
3,968,992
1,280,320
0.20%
3,597,699
1,280,320
0.25%
Financial assets are classified as financial assets at FVTPL when the financial asset is either held for trading or it is
designated as at fair value through profit or loss.
Centuria Bass First Mortgage Fund
No. 2
Centuria Bass First Mortgage Fund
No. 3
1,250,000
1,250,000
6.59%
1,076,923
1,076,923
8.47%
-
-
-
-
0%
0%
Financial assets at FVTPL are stated at fair value, with any gains or losses arising on remeasurement recognised in profit or
loss. The net gain or loss recognised in profit or loss incorporates any dividend or interest earned on the financial asset and
is included in the statement of comprehensive income.
AASB 9 contains three principal classification categories for financial assets:
Centuria SOP Fund
1,068,100
1,000,000
3.28%
1,140,900
1,000,000
3.28%
• measured at amortised cost;
16,633,872
637,537,062
16,241,341
608,728,973
• measured at fair value through other comprehensive income (FVOCI); and
• measured at FVTPL.
1. The fund was previously known as Primewest Agriculture No. 2 Fund.
2. The fund was previously known as Primewest Large Format Retail Trust No. 2.
The classification depends on the entity's business model for managing the financial assets and the contractual terms of
the cash flows.
2023
$'000
2022
$'000
There are no measurements of FVOCI as at 30 June 2023.
1. Financial assets at amortised cost
RELATED PARTY UNIT TRUSTS CARRIED AT FAIR VALUE THROUGH PROFIT AND LOSS
Opening balance
Investment purchases
Disposals
Foreign currency translation
Mark to market movement
Carrying value transferred from equity accounted investments
608,729
63,736
(61,966)
2,085
(6,044)
30,997
637,537
(f) Loans receivable from related parties
The following loans were receivable from related parties of the Group at the end of the financial year:
Centuria NZ Healthcare Property Fund
Movement during the period as follows:
Opening balance
Drawdowns
Repayments
Provision
Foreign currency translation
2023
$'000
45,160
2023
$'000
70,045
-
(24,618)
(1,275)
1,008
45,160
664,304
160,789
(80,478)
(2,448)
(146,692)
13,254
608,729
2022
$'000
70,045
2022
$'000
-
84,185
(13,345)
-
(795)
70,045
$45,159,732 of the loan receivable from Centuria NZ Healthcare Property Fund (CNZHPF) accrues interest at 4.75% per
annum and does not have a maturity date and therefore is considered non-current.
As of 30 June 2023, the Group assessed the recoverability of the loan receivable from CNZHPF and recognised $1,275,000
loss allowance against the asset. Refer to note F2(d) for details.
Loans and receivables are initially recognised at fair value and subsequently at amortised cost using the effective interest
rate method less any allowance under the expected credit loss (ECL) model.
2. Recoverability of loans and receivables
At each reporting period, the Group assesses whether financial assets carried at amortised cost are ‘credit-impaired’. A
financial asset is ‘credit-impaired’ when one or more events that has a detrimental impact on the estimated future cash
flows of the financial asset have occurred.
The Group recognises loss allowances at an amount equal to lifetime ECL on trade and other receivables. Loss allowances
for financial assets measured at amortised cost are deducted from the gross carrying amount of the assets.
Lifetime ECLs result from all possible default events over the expected life of the trade receivables and are a probability-
weighted estimate of credit losses. Credit losses are measured as the difference between cash flows due to the Group in
accordance with the contract and the cash flows that the Group expects to receive.
The Group analyses the age of outstanding receivable balances and applies historical default percentages adjusted for
other current observable data as a means to estimate lifetime ECL, including forecasts of interest rates and inflation, as
well as the financial stress of counterparties and their ability to operate as a going concern. Debts that are known to be
uncollectable are written off when identified.
The Group has continued to analyse the age of outstanding receivable balances post balance sheet date and applied
estimated percentages of recoverability to estimate ECL, as well as the financial stress of counterparties and their ability to
operate as a going concern. Debts that are known to be uncollectible are written off when identified.
3. Financial assets at FVTPL
All financial assets not classified as measured at amortised cost or FVOCI as described above are measured at FVTPL.
This includes all derivative financial assets. On initial recognition, the Group may irrevocably designate a financial asset
that otherwise meets the requirements to be measured at amortised cost or FVOCI or FVTPL if doing so eliminates or
significantly reduces an accounting mismatch that would otherwise arise.
A financial asset (unless it is a trade receivable without a significant financing component that is initially measured at
the transaction price) is initially measured at fair value plus, for an item not at FVTPL, transaction costs that are directly
attributable to its acquisition.
Financial assets at FVTPL are subsequently measured at fair value. Net gains and losses, including any interest or dividend
income, are recognised in profit or loss.
Financial assets recognised at FVTPL include reverse mortgage loan receivables, reverse mortgage derivatives and
investments in trusts.
132 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 133
Notes to the financial statements
C4
Investment properties
264 Copelands Road, Warragul Vic
111 St George Terrace, Perth WA
2023
$'000
-
-
-
2022
$'000
177,000
160,500
337,500
Investment properties are classified as non-current.
The Group ceased to have control over Centuria 111 St Georges Terrace Fund and Centuria Agriculture Fund during the
period. As a result, the Group deconsolidated the funds in the current period.
Opening balance
Capital improvements and associated costs
Gain on fair value
Change in deferred rent and lease incentives
Deconsolidation of controlled property funds
Acquisition of subsidiary
Closing balance
C5
Inventory
Property held for development
Properties held for sale
Notes
C5(a)
C5(b)
Property held for sale are classified as current.
Property held for development are classified as non-current.
(a) Property held for development
1 & 1a Macmurray Road 4, 6, 10 & 10a Robert Hall Avenue, Remuera, Auckland
17-19 Man Street, Queenstown, New Zealand
741 Cudgen Road, Cudgen, Australia
27-29 Young Street, West Gosford, Australia
54 Cook Street, Auckland, New Zealand
Opening balance
Acquisitions
Reversal of impairment/(impairment)
Foreign currency translation
Capital expenditure
Disposals
2023
$'000
337,500
-
-
-
(337,500)
-
-
2023
$'000
43,949
44,759
88,708
2023
$'000
21,151
15,314
6,025
1,459
-
43,949
2023
$'000
45,679
20,246
2,882
2,027
3,318
2022
$'000
208,140
385
2,251
(1,136)
(49,140)
177,000
337,500
2022
$'000
45,679
89,104
134,783
2022
$'000
-
14,447
5,648
1,410
24,174
45,679
2022
$'000
53,744
11,025
(3,989)
(1,429)
16,390
(30,203)
43,949
(30,062)
45,679
Notes to the financial statements
On 7 October 2022, the Group acquired the Macmurray Road residential property for NZ$22,598,000 (AU$20,246,000).
During the year, 54 Cook Street reversed a previous impairment up to the sale price of the property. On 10 May 2023, the
Group settled 54 Cook Street, Auckland for NZ$32,250,000 (AU$30,203,000).
Recognition and measurement
Properties held for development relates to land and property developments that are held for development and sale
in the normal course of the Group’s business. Properties held for development are carried at the lower of cost or net
realisable value. The calculation of net realisable value requires estimates and assumptions which are regularly evaluated
and are based on historical experience and expectations of future events that are believed to be reasonable under the
circumstances. Properties held for development are classified as non-current assets unless they are contracted to be sold
within 12 months of the end of the reporting period, in which case they are classified as current assets.
(b) Properties held for sale
On 31 March 2022, the Group acquired 12 healthcare properties from Heritage Lifecare for NZ$98,700,000. On 14 June
2023, the Group settled on the sale of 4 properties to Centuria NZ Property Fund (CNZPF) for NZ$34,134,000. The
properties were settled by cash consideration of NZ$19,200,000 and 14,800,000 units in CNZPF were issued to the Group.
In June 2023, the Group entered into an unconditional sale agreement with a third party to sell the Hodgson House Lifecare
asset for NZ$6,920,000 and is expected to settle in September 2023.
As at 30 June 2023, the properties were impaired to NZ$48,700,000.
10 Danvers Street, Hastings (Waiapu Lifecare)
202 - 204 Kamo Road, Whangarei (Puriri Court Lifecare)
69 Moehau Street, Te Puke (Carter House Lifecare)
50 McLauchlan Street, Blenheim (Waterlea Lifecare)
117 Shakespeare Street, West Coast (Granger House Lifecare)
1 Cargill Street, Invercargill (Cargill Lifecare)
15 Karina Terrace, Palmerston (Karina Lifecare)
16 Anvers Place, Christchurch (Hoon Hay Rest Home)
1 Hennessy Place, Christchurch (George Manning)
51 Botanical Road, Tauranga (Hodgson House Lifecare)
361 Mangorei Road, New Plymouth (Riverside Lifecare)
124 Maxwell Road, Marlborough (Maxwell Lifecare)
Opening balance
Acquisitions
Additions
Disposals
Impairment
Foreign currency translation
2023
$'000
10,659
9,924
8,086
5,789
5,743
2,940
1,608
-
-
-
-
-
44,759
2023
$'000
89,104
-
148
(37,408)
(8,512)
1,427
44,759
2022
$'000
11,382
10,707
8,603
6,176
6,088
3,045
1,676
12,794
12,485
7,633
6,397
2,118
89,104
2022
$'000
-
91,366
-
-
-
(2,262)
89,104
Recognition and measurement
Properties held for sale are carried at the lower of cost or net realisable value. The calculation of net realisable value
requires estimates and assumptions which are regularly evaluated and are based on historical experience and
expectations of future events that are believed to be reasonable under the circumstances. Properties held for sale are
classified as current assets.
134 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 135
Notes to the financial statements
C6
Intangible assets
Goodwill1
Indefinite life management rights
Opening balance
Foreign currency translation
Purchase price accounting adjustments1
2023
$'000
484,456
308,616
793,072
2023
$'000
791,521
1,551
-
793,072
2022
$'000
483,269
308,252
791,521
2022
$'000
790,551
(2,574)
3,544
791,521
1. The prior period Goodwill has been amended to reflect purchase price adjustments of $3,300,000 that had been recorded as a tax receivable and
should have been recorded as part of the purchase price consideration. The tax receivable as at 30 June 2022 had a corresponding impact decreasing
by $3,300,000.
Goodwill and intangible assets are classified as non-current.
Goodwill and management rights are solely attributable to the property funds management cash generating unit with
recoverability determined by a value in use calculation using profit and loss projections covering a five year period, with a
terminal value determined after five years.
Recognition and measurement
1. Indefinite life management rights
Notes to the financial statements
Discount rate
Discount rates are determined to calculate the present value of future cash flows. A pre-tax rate of 10.0% (2022: 11.8%)
is applied to cash flow projections. In determining the appropriate discount rate, regard has been given to relevant market
data as well as Group specific inputs.
Terminal growth rate
Beyond 2028, a growth rate of 3.0% (2022: 3.0%), in line with long term economic growth, has been applied to determine
the terminal value of the asset.
Sensitivity to changes in assumptions
As at 30 June 2023, the estimated recoverable amount of intangibles including goodwill relating to the property funds
management cash-generating unit exceeded its carrying amount by $397,800,000 (2022: $324,500,000). The table below
shows the key assumptions used in the value in use calculation and the amount by which each key assumption must
change in isolation in order for the estimated recoverable amount to be equal to its carrying value.
Assumptions used in value-in-use calculation
Rate required for recoverable amount to equal carrying value
4.48%
2.12%
10.01%
13.37%
5.32%
12.29%
Revenue growth rate
Pre-tax dis-count
rate
Expenses growth
rate
C7
Payables
Sundry creditors1
Dividend/distribution payable
Accrued expenses
2023
$'000
26,954
46,388
19,076
92,418
2022
$'000
63,825
43,477
27,317
134,619
Management rights acquired in a business combination are initially measured at fair value and reflect the right to provide
asset and fund management services.
1. Sundry creditors are non-interest bearing liabilities and are payable on commercial terms of 7 to 60 days.
2. Goodwill
All trade and other payables are considered to be current as at 30 June 2023 due to their short-term nature.
Goodwill acquired in a business combination is measured at cost and subsequently measured at cost less any impairment
losses. The cost represents the excess of the cost of a business combination over the fair value of the identifiable assets,
liabilities and contingent liabilities acquired.
3. Impairment
Goodwill and intangible assets that have an indefinite useful life are tested annually for impairment, or more frequently
if events or changes in circumstances indicate that they might be impaired. Other assets are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. For
the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable
cash inflows that are largely independent of the cash inflows from other assets or groups of assets (cash generating units
or CGUs). Non-financial assets other than goodwill that were previously impaired are reviewed for possible reversal of the
impairment at each reporting date.
Key estimates and judgements
The key assumptions used in the value in use calculations for the property funds management cash-generating unit are as
follows:
Revenue
Revenues from 2024-2028 are assumed to increase at an average rate of 4.5% (2022: 5.8%) per annum. The directors
believe this is a prudent and achievable growth rate based on past experience.
Expenses
Expenses from 2024-2028 are assumed to increase at an average rate of 5.3% (2022: 6.4%) per annum. The directors
believe this is an appropriate growth rate based on past experience.
Recognition and measurement
Payables are recognised when the Group becomes obliged to make future payments resulting from the purchase of goods
and services. Due to the short-term nature of these financial obligations, their carrying amounts are estimated to represent
their fair values.
Dividend and distribution payable is made for the amount of any dividend/distribution the Group has declared, on or before
the end of the reporting period but not distributed at the end of the reporting period.
C8
Borrowings
Secured listed redeemable notes
Fixed rate secured notes
Floating rate secured notes
Reverse mortgage bill facilities and notes
Secured bank loans - New Zealand
Secured bank loans in Controlled Property Funds
Borrowing costs capitalised
Notes
C8(a)
C8(b)
C8(b)
C8(c)
C8(d)
C8(e)
2023
$'000
2022
$'000
195,693
198,693
99,407
80,000
3,870
-
-
(3,753)
375,217
99,388
96,650
4,600
44,417
190,239
(4,602)
629,385
136 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 137
Notes to the financial statements
Notes to the financial statements
Opening balance
Drawdowns
Repayments
Foreign currency translation
Capitalised borrowing costs
Amortisation of borrowing costs
Adjustment for Benefit Funds investment
Net movement in controlled property funds
2023
$
2022
$
629,385,202
426,641,285
96,650,000
192,654,151
(159,774,068)
(72,904,023)
1,326,514
(1,089,002)
(1,068,957)
(1,839,797)
1,918,570
2,134,088
(2,981,066)
(22,763)
(190,239,276)
83,811,263
375,216,919
629,385,202
The terms and conditions relating to the above facilities are set out below.
(a) Secured listed redeemable notes
On 21 April 2021, the Fund issued $198,693,000 of listed redeemable notes with a variable interest rate of 4.25% plus the
bank bill rate which is due to mature on 21 April 2026.
On 24 February 2023, the Centuria Benefit Funds invested $3,000,000 into the listed redeemable notes.
The secured listed redeemable notes are secured by the first ranking general security deeds over all assets of the issuer
and sit pari-passu with the secured notes.
(b) Secured notes
Classification
Coupon rate Due date
FIXED
Tranche 5 Current
5.00% 21 April 2024
Tranche 7 Non-current
5.46% 25 March 2025
Classification
Coupon rate
Due date
FLOATING
Total limit
$'000
Facility
available
$'000
2023
$'000
2022
$'000
29,407
70,000
99,407
-
-
-
29,407
70,000
99,407
29,388
70,000
99,388
Total limit
$'000
Facility
available
$'000
2023
$'000
2022
$'000
Tranche 4 Not applicable BBSW +4.25% 21 April 2023
Tranche 6 Not applicable BBSW +4.50% 21 April 2024
-
-
Tranche 8 Non-current
BBSW +3.35% 25 March 2025
30,000
-
-
-
Revolver A Non-current
BBSY +2.25% 16 December 2024
100,000
100,000
Revolver B Non-current
BBSY +2.45% 30 June 2027
50,000
50,000
Term Loan Non-current
BBSY +2.60% 6 April 2028
50,000
-
230,000
150,000
-
-
30,000
-
-
50,000
80,000
35,000
31,650
30,000
-
-
-
96,650
(c) Reverse mortgage bill facilities and notes (secured)
As at 30 June 2023, the Group had $3,870,000 (2022: $4,600,000) non-recourse notes on issue to ANZ Bank, secured
over the remaining reverse mortgages held in Senex Warehouse Trust No.1 (a subsidiary of the Group) due to mature on
30 November 2024 and is classified as non-current as at 30 June 2023. The non-recourse notes have a coupon rate of
BBSY+2.35%.
The facility limit as at 30 June 2023 is $4,700,000 (2022: $5,500,000) and is reassessed every 6 months with a view to
reducing the facility in line with the reduction in the reverse mortgage book. Under the facility agreement, surplus funds
(being mortgages repaid (including interest) less taxes, administration expenses and any derivatives related payments) are
required to be applied against the facility each month.
Facility
Amount used at reporting date
Amount unused at reporting date
2023
$'000
4,700
2022
$'000
5,500
(3,870)
(4,600)
830
900
(d) Secured bank loans - New Zealand
There are no secured bank loans for New Zealand as of 30 June 2023.
On 13 June 2023, the Group cancelled the New Zealand Investment Facility.
On 14 June 2023, the Group fully repaid the New Zealand Asset Facility and on 15 June 2023, subsequently cancelled the
facility.
(e) Bank loans - controlled property funds (secured)
The Group ceased to have control over Centuria 111 St Georges Terrace Fund and Centuria Agriculture Fund during the year. As
a result, the Group deconsolidated the funds. There were no bank loans from controlled property funds as at 30 June 2023.
Recognition and measurement
Borrowings are initially recognised at fair value, net of transaction costs. They are subsequently measured at amortised
cost using the effective interest rate method.
C9
Call/put option liability
Healthcare call/put option
Flavorite call/put option
Opening balance
Movement
New call/put option entered
Call/put option exercised
2023
$'000
38,255
-
38,255
2023
$'000
84,095
(10,440)
-
(35,400)
38,255
2022
$'000
48,695
35,400
84,095
2022
$'000
22,690
26,005
35,400
-
84,095
The following facilities were entered into or redeemed during the year:
The Healthcare call/put option is considered non-current as at 30 June 2023.
On 6 April 2023, the Group entered into a 5 year $50,000,000 secured loan note facility. The facility is a floating rate
revolving facility with a margin of 2.60% which is due to mature on 6 April 2028.
On 21 April 2023, the Group fully redeemed a total of $66,650,000 secured wholesale floating rate notes maturing on 21
April 2023 and 21 April 2024.
During the year, the Group drew $46,650,000 from the Revolver A facility, which was subsequently repaid on 23 June 2023.
The secured notes are secured by the first ranking general security deeds over all assets of the issuer and sit pari-passu
with the secured listed redeemable notes.
The Healthcare call/put option liability relates to a simultaneous call option and put option over the remaining shares in
Centuria Healthcare which are held by existing management shareholders of Centuria Healthcare. The call option is in
favour of the Group, whilst the put option is in favour of the management shareholders. The options are exercisable five
years from the date of completion of the current 59% economic interest in Centuria Healthcare, with an exercise price
equal to 10x EBIT for the last financial year prior to exercise of the option plus net tangible assets.
Recognition and measurement
The option liabilities are measured at net present value at recognition (including transaction costs, for assets and liabilities
not measured at fair value through profit or loss). Subsequently at each reporting period, for changes in the expected
exercise price and time value impacts, the Group recognises the movement in the profit and loss.
138 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 139
Notes to the financial statements
Notes to the financial statements
Original term
Extension option
Fixed annual rent
increase
The Group issued 2,792,516 stapled securities on 11 August 2022 in relation to the distribution reinvestment plan
undertaken for the 2022 final distribution.
Fully paid ordinary securities carry one vote per security and carry the right to distributions.
The Group issued 117,970 stapled securities on 1 July 2022 in relation to the employee incentive scheme.
C10 Right of use asset/lease liability
The Group has eight lease commitments outlined below:
Lease
Level 41, 2 Chifley Square, Sydney NSW
Level 47, 101 Collins Street, Melbourne Vic
Level 2, 348 Edward Street, Brisbane Qld
Level 27, 140 St Georges Terrace, Perth WA
38-35 Gaunt Street, Auckland NZ
Suite 7.01, 9 Help Street, Chatswood NSW
10 years
5 years
5 years
7 years
8 years
8 years
5 years
5 years
-
5 years
-
-
-
Level 7 & part Level 8, 154 Melbourne Street, South Brisbane Qld
7 years
331-335 Devon Street East, New Plymouth NZ
3 years
3 years
The current right of use asset is $4,988,000 (2022: $2,686,000) and the current lease liability is $3,972,000 (2022:
$2,298,000). The remaining right of use asset and lease liability is classified as non-current.
Right of use asset
Opening balance
Additions of new leases
Derecognition
Depreciation on right of use asset
Lease liability
Opening balance
Additions
Cash lease payments
Lease interest
Derecognition
2023
$'000
17,006
20,213
(953)
(3,676)
32,590
2023
$'000
19,443
20,213
(4,431)
1,613
(1,113)
35,725
C11 Contributed equity
Centuria Capital Limited
No. of securities
$'000
No. of securities
2023
2022
Balance at beginning of the period
Stapled securities issued
792,787,120
6,309,299
Equity settled share based payments expense
700,375
Change in value of units issued
Cost of equity raising
Balance at end of period
389,717
787,802,693
2,125
2,970
-
(1)
2,617,009
2,367,418
-
-
-
-
799,796,794
394,811
792,787,120
389,717
2023
2022
4.0%
3.25%
3.5%
3.25%
2.5%
3.75%
3.25%
CPI
2022
$'000
19,947
-
-
(2,941)
17,006
2022
$'000
21,757
-
(3,350)
1,036
-
19,443
$'000
386,634
2,039
981
236
(173)
The Group issued 3,398,813 stapled securities on 9 February 2023 in relation to the distribution reinvestment plan
undertaken for the 2023 interim distribution.
Recognition and measurement
Incremental costs directly attributed to the issue of ordinary shares are accounted for as a deduction from equity, net of
any tax effects.
C12 Commitments and contingencies
Australian guarantees
The Group has provided bank guarantees of $2,007,143 (30 June 2022: $3,334,153) for commercial leases with respect to
its Sydney and Melbourne office premises. These bank guarantees are cash collateralised.
The above guarantees are issued in respect of the Group and do not constitute an additional liability to those already
existing in interest bearing liabilities on the statement of financial position.
New Zealand guarantees
Under the Development Agreement with Queenstown Lakes District Council (QLDC) as part of the Lakeview joint
venture, the Group have provided a guarantee of the Partnership’s obligations under the Development Agreement, with a
maximum capital commitment of NZ$14,000,000. The Group's total aggregate liability under this guarantee is capped at
NZ$4,250,000. Refer to Note E1 Interests in associates and joint ventures for more information.
Capital commitments
At 30 June 2023, the Company has committed up to a further NZ$11,000,000 of capital over approximately the next 8 years
in its joint venture partnership with Ninety Four Feet.
Contingent liabilities
The directors of the Group are not aware of any contingent liabilities in relation to the Group, other than those disclosed in
the financial statements, which should be brought to the attention of securityholders as at the date of completion of this
report.
Centuria Capital Fund (non-controlling interests)
No. of securities
$'000
No. of securities
$'000
Balance at beginning of the period
792,787,120
1,025,584
787,802,693
1,018,822
Stapled securities issued
Equity settled share based payments expense
Cost of equity raising
Change in value of units issued
6,309,299
700,375
-
-
9,201
-
(6)
-
2,617,009
2,367,418
-
-
6,636
-
(344)
470
Balance at end of the period
799,796,794
1,034,779
792,787,120
1,025,584
140 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 141
Notes to the financial statements
D Cash flows
D1
Operating segment cash flows1
For the year ended 30 June 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Management fees received
Performance fees received
Distributions received
Interest received
Cash received on development projects
Rent received
Payments to suppliers and employees
Income tax paid
Interest paid
Net cash provided by operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of related party investments
Purchase of investments in related parties
Repayment of loans by related parties
Loans to related parties
Purchase of equity accounted investments
Loans repaid by other parties
Payments for plant and equipment
Payments of balances held in trust for related parties
Purchase of subsidiaries
Sale of property held for development
Collections from reverse mortgage holders
Proceeds from investments
Loans provided to other parties
Proceeds from sale of equity accounted investments
Purchase of properties held for development
Net cash provided by/(used in) investing activities
Cash flows from financing activities
Proceeds from issue of securities
Equity raising costs paid
Proceeds from borrowings
Repayment of borrowings
Costs paid to issue debt
Distributions paid
Net cash (used in)/provided by financing activities
Net (decrease) in operating cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the end of the period
142 | Centuria Capital Group – Annual Report 2023
1. The operating segment cash flows support the segment note disclosures of the Group and provide details in relation to the operating segment cash flows
performance of the Group. The operating segment cash flows exclude the impact of cash flows attributable to Benefit Funds and Controlled Property Funds.
The statutory cash flow movements for the Group per page 106 are as follows:
Notes to the financial statements
• Net cash provided by operating activities $113,682,000
• Net cash provided by investing activities $61,153,000
• Net cash used in financing activities $148,428,000
D2
Cash and cash equivalents
Included in total cash and cash equivalents of $225,460,000 (2022: $200,565,000) is $46,738,000 (2022: $10,513,039)
relating to amounts held by Senex Warehouse Trust No.1 and the Benefit Funds which is not readily available for use by the
Group.
D3
Reconciliation of profit for the period to net cash flows from operating activities
For the year ended 30 June 2023
Profit for the year
ADJUSTMENTS FOR
Depreciation and amortisation
Non-cash development income
Share-based payment expense
Amortisation of borrowing costs
Non-cash performance and sales fees
Mark to market movement of financial assets
Interest revenue from reverse mortgages
Interest expense reverse mortgage facility
Equity accounted profit in excess of distribution paid
Unrealised foreign exchange loss
Unrealised (gain)/loss on investment properties
Amortisation of lease incentives
Costs paid for debt issuance
Loss allowance for loans receivable
Lease interest
CHANGES IN NET ASSETS AND LIABILITIES:
(Increase)/decrease in assets:
Receivables
Deferred tax assets
Increase/(decrease) in liabilities:
Other payables
Tax provision
Deferred tax liability
Provisions
Policyholder liability
Net cash flows provided by operating activities
2023
$'000
2022
$'000
105,932
(37,361)
5,596
(4,556)
6,311
1,919
(28,556)
(12,424)
(3,733)
1,510
3,804
2,523
5,496
-
1,094
1,275
1,613
4,179
(1,498)
5,010
2,195
(14,015)
186,643
(2,746)
1,966
612
3,558
3,741
1,789
1,901
28
1,036
13,654
41,440
25,095
(2,205)
(411)
(8,140)
(29,239)
338
8,236
113,682
38,653
3,240
(18,179)
1,051
(33,092)
171,601
Recognition and measurement
For the purposes of the statement of cash flows, cash and cash equivalents includes cash on hand and in banks. Cash
equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash, which are subject
to an insignificant risk of changes in value and have an initial maturity of three months or less at the date of acquisition. Bank
overdrafts are shown within borrowings in the statement of financial position.
Centuria Capital Group – Annual Report 2023 | 143
2023
$'000
2022
$'000
192,277
143
46,582
6,967
3,498
5,711
204,593
20,829
48,791
4,862
48,511
1,951
(127,790)
(109,016)
(12,169)
(31,855)
83,364
(18,727)
(19,727)
182,067
52,364
77,299
(52,410)
(198,790)
27,507
-
(49,036)
31,313
(2,314)
(14,802)
20,216
(94,255)
(20,537)
-
(2,697)
-
-
(89,070)
29,049
2,521
31,708
(39,734)
65,402
(20,246)
12,086
2,551
4,737
-
8,324
-
61,322
(280,136)
8,884
(7)
96,650
(159,749)
(1,094)
8,300
(328)
142,353
(23,395)
(1,900)
(93,483)
(90,524)
(148,799)
34,506
(4,113)
(63,563)
184,999
(1,511)
179,375
249,637
(1,075)
184,999
Notes to the financial statements
E Group structure
E1
Interests in associates and joint ventures
Set out below are the associates of the Group as at 30 June 2023 which, in the opinion of the directors, were material to
the Group and were accounted for using the equity method. The entities listed below have share capital consisting solely
of ordinary units, which are held directly by the Group. The proportion of ownership interest is the same as the proportion of
voting rights held.
Name of entity
Centuria Diversified Property Fund
Centuria Bass Credit
Allendale Square Fund
Centuria Government Income Property Fund No.2
QT Lakeview Developments Limited
Total equity accounted investments
% of ownership interest
30 June
2023
%
30 June
2022
%
Principal activity
Carrying amount
30 June
2023
$'000
30 June
2022
$'000
21.54
50.00
25.91
21.59
25.00
22.38 Property investment
35,860
39,021
50.00 Non-bank finance
26,162
25,765
0.00 Property investment
18,426
22.03 Property investment
25.00 Property investment
7,261
2,973
-
7,743
2,240
90,682
74,769
Equity accounted investments are classified as non-current.
The Group’s subsidiary, Augusta Lakeview Holdings Limited (Lakeview Holdings) has signed a partnership agreement with
NFF QT Development Unit Trust (NFF) to establish QT Lakeview Partnership (the Joint Venture) to develop the Lakeview
site in Queenstown, New Zealand. Lakeview Holdings has a 25% interest in the Joint Venture which represents a maximum
capital commitment to Lakeview Holdings of NZ$14,000,000. The Joint Venture has entered into a development agreement
with the Queenstown Lakes District Council to develop a range of residential, hotels, co-working, co-living, hospitality and
retail options on the 3 hectare site on a staged basis, with construction estimated to take more than 10 years and phased
over 7 stages.
On 22 April 2021, the Group acquired 50% of Bass Capital Partners Pty Ltd (Centuria Bass) for $25,417,876 with the option
to fully acquire the remaining 50% interest in five years. From that date, the Group has equity accounted its interest
in Centuria Bass which offers non-banking finance for real estate secured transactions including land sub-division,
development projects, bridging finance and residual stock.
In November 2022, the Group acquired 36.11% ownership stake in the Allendale Sqaure Fund. From that date, the Group
has equity accounted its interest in that fund. The ownership stake decreased to 25.91% as at 30 June 2023.
Recognition and measurement
Associates are those entities in which the Group has significant influence, but not control or joint control, over the financial
and operating policies. A joint venture is an arrangement in which the Group has joint control, whereby the Group has rights
to the net assets of the arrangement, rather than rights to its assets and obligations for its liabilities.
Interests in associates and joint ventures are accounted for using the equity method. They are initially recognised at cost,
which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements include the
Group’s share of the profit or loss and OCI of the associates and joint ventures, until the date on which significant influence
or joint control ceases.
Notes to the financial statements
The below table shows the movement in carrying amounts of equity accounted investments from 1 July 2022 to 30 June
2023.
Centuria
Diversified
Property
Fund
$'000
Centuria
Bass Credit
$'000
Allendale
Street Fund
$'000
Centuria
Government
Income
Property
Fund No. 2
$'000
QT Lakeview
Developments
Limited
$'000
Centuria
Industrial
Income Fund
No. 2
$'000
Centuria 111
St Georges
Terrace
$'000
Centuria
Agriculture
Fund
$'000
Total
$'000
Carrying amounts of equity accounted investments
Opening balance as at
1 July 2022
Acquisition of investments
Carrying value transferred
from controlled property
funds
Share of net profit/(loss)
after tax
Distributions received/
receivable
Carrying value transferred
from/(to) financial assets
Disposals
Foreign exchange
translation
Closing balance as at
30 June 2023
39,021
25,765
-
7,743
2,240
-
807
10,929
-
-
-
74,769
5,662
49,036
-
-
-
-
31,638
-
-
-
(200)
4,607
1,227
71
(1,961)
(4,210)
(926)
(403)
-
(1,000)
-
-
-
-
-
-
(13,513)
(150)
-
-
(74)
35,860
26,162
18,426
7,261
2,973
-
-
-
-
-
-
31,754
35,400
67,154
(815)
190
(799)
4,281
(148)
(15)
(422)
(8,085)
(4,802)
(12,394)
(13,801)
(30,997)
(5,164)
(19,535) (26,040) (65,402)
-
-
-
-
-
-
(74)
90,682
The below table shows the movement in carrying amounts of equity accounted investments from 1 July 2021 to 30 June 2022.
Centuria
Diversified
Property
Fund -
stapled1
$'000
Centuria
Diversified
Property
Fund - pre-
stapled1
$'000
Primewest
Property
Income Fund
$'000
Centuria
Bass Credit
$'000
Centuria
Government
Income
Property
Fund No. 2
$'000
QT Lakeview
Developments
Limited
$'000
Centuria
Wholesale
Agricultural
Trust No. 22
$'000
Centuria
New Zealand
Property
Fund
$'000
Centuria
New
Zealand
Healthcare
Property
Fund
$'000
Total
$'000
Carrying amounts of equity accounted investments
28,144
- 25,704
-
1,789
-
-
-
12,424
405
10,325
-
-
-
55,637
5,227
28,381
Opening balance as
at 1 July 2021
Acquisition of
investments
Carrying value
transferred from
controlled property
funds
Share of net profit/
(loss) after tax
Distributions
received/receivable
Carrying value
transferred from/(to)
financial assets
Disposals
Fair value gain/
(loss)
Stapling of CDPF
and PPIF(i)
Closing balance as
at 30 June 2022
-
-
-
-
-
12,827
-
-
(565)
1,539
1,007
2,911
429
(175)
(3,421)
(403) (2,850)
(336)
-
-
-
-
-
-
-
(94)
162
39,761 (26,168)
(13,593)
-
-
-
-
-
(4,774)
-
-
39,021
-
- 25,765
7,743
2,240
-
-
-
-
-
46
-
-
15,080
1,780
(528)
-
-
-
-
-
27,907
7,101
(7,713)
(8,027)
(15,080)
(5,227)
(28,334)
(3,550)
-
-
-
-
-
-
-
-
-
-
-
(8,324)
114
-
74,769
144 | Centuria Capital Group – Annual Report 2023
1. On 27 May 2022, Centuria Diversified Property Fund (CDPF) and Centuria Diversified Property Fund No.2 (formerly known as Primewest Property Income
Fund) (PPIF) were stapled together. After the stapling, the Fund's residual combined ownership stake is 22.38% as at 30 June 2022.
2. The fund was previously known as Primewest Agriculture No. 2 Fund.
Centuria Capital Group – Annual Report 2023 | 145
Notes to the financial statements
Notes to the financial statements
(a) Summarised financial information for associates and joint ventures
The tables below provide summarised financial information for those associates. The information disclosed reflects the
amounts presented in the consolidated financial statements of the relevant associates and not the Group's share of those
amounts.
Summarised balance sheet
Cash and other cash equivalents
Other current assets
Total current assets
Non-current assets
Total non-current assets
Current liabilities
Total current liabilities
Non-current liabilities
Total non-current liabilities
Net tangible assets
Group's share in %
Group's share
Goodwill
Carrying amount
Centuria Diversified Property
Fund1
Centuria Bass Credit
Centuria Government Income
Property Fund No. 2
QT Lakeview Developments
Limited
Allendale Square Fund
Total
30 June 2023
30 June 2022
30 June 2023
30 June 2022
30 June 2023
30 June 2022
30 June 2023
30 June 2022
30 June 2023
30 June 2022
30 June 2023
30 June 2022
4,898
4,171
9,069
231,182
231,182
4,251
4,251
86,530
86,530
149,470
21.54%
32,196
3,664
35,860
10,121
12,086
22,207
244,914
224,914
8,196
8,196
99,237
99,237
159,688
22.38%
35,738
3,283
39,021
7,646
38,079
45,725
620,762
620,762
41,865
41,865
620,069
620,069
4,553
17,046
9,012
26,058
256,889
256,889
10,439
10,439
266,923
266,923
5,585
538
1,944
2,482
61,821
61,821
448
448
30,634
30,634
33,221
1,557
1,958
3,515
62,814
62,184
973
973
30,585
30,585
34,771
50.00%
50.00%
21.59%
22.03%
2,277
23,885
26,162
2,797
22,968
25,765
7,172
89
7,261
7,658
85
7,743
-
-
-
11,890
11,890
-
-
-
-
11,890
25.00%
2,973
-
2,973
-
-
-
8,190
8,190
-
-
-
-
8,190
25.00%
2,047
193
2,240
13,753
1,177
14,930
122,599
122,599
13,451
13,451
52,963
52,963
71,115
25.91%
18,426
-
18,426
26,835
45,371
72,206
1,048,254
1,048,254
60,015
60,015
790,196
790,196
270,250
28,724
23,056
51,780
572,807
572,807
19,608
19,608
396,745
396,745
208,234
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Summarised statement of comprehensive income
30 June 2023
30 June 2022
30 June 2023
30 June 2022
30 June 2023
30 June 2022
30 June 2023
30 June 2022
30 June 2023
30 June 2022
30 June 2023
30 June 2022
Centuria Diversified Property
Fund1
Centuria Bass Credit
Centuria Government Income
Property Fund No. 2
QT Lakeview Developments
Limited
Allendale Square Fund
Total
Revenue
Net loss on fair value of investment properties
Gain/(loss) on fair value of investments and derivatives
Finance costs
Other expenses
Profit/(loss) for the period
Other comprehensive income
Total comprehensive income
Group's share in %
Group's share in $
1. The 30 June 2022 balance sheet represents the stapled CDPF fund.
19,304
(6,339)
(1,939)
(3,583)
(8,370)
(927)
-
(927)
6,977
(390)
1,311
(1,209)
(4,603)
2,086
-
2,086
23,644
15,569
-
-
(392)
(14,038)
9,214
-
9,214
-
-
(272)
(9,475)
5,822
-
5,822
4,173
(1,317)
(199)
(789)
(1,541)
327
-
327
2,394
(1,871)
2,106
(385)
(821)
1,423
-
1,423
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
21.54%
22.38%
50.00%
50.00%
21.59%
22.03%
25.00%
25.00%
(200)
974
4,607
2,911
71
429
-
-
8,985
-
-
(1,558)
(2,689)
4,738
-
4,738
25.91%
1,227
56,106
(7,656)
(2,138)
(6,322)
24,940
(2,261)
3,417
(1,866)
(26,638)
(14,899)
13,352
-
13,352
9,331
-
9,331
-
-
-
-
-
-
-
-
-
-
146 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 147
Notes to the financial statements
E2
Interests in subsidiaries
The Group's principal subsidiaries at 30 June 2023 are set out below. Unless otherwise stated, they have issued capital
consisting solely of ordinary shares or units that are held directly by the Group, and the proportion of ownership interests
held equals the voting rights held by the Group. The subsidiaries of the Group were incorporated in the following
jurisdictions, Australia, New Zealand and Singapore with principal places of business corresponding with the respective
geographic jurisdictions. The parent entity of the Group is Centuria Capital Limited.
Australian subsidiaries
Centuria Capital Fund
80 Grenfell Street Pty Ltd
A.C.N. 062 671 872 Pty Limited
Ahnco Pty Ltd1
Amberlee Nominees Pty Ltd
Belmont Road Development Pty Limited
Belmont Road Management Pty Limited
Centuria 57 Wyatt Street Pty Ltd
Centuria 61-67 Wyatt St Pty Limited
Centuria 80 Flinders Street Pty Limited
Centuria 111 St Georges Terrace Fund2
Centuria Agriculture Fund I
Centuria Agriculture Fund II
Centuria Agri Logistics REIT I
Centuria Agri Logistics Pty Limited
Centuria ALRI (A) Trust
Centuria ALRI (B) Trust
Centuria ALRI (C) Trust
Centuria Business Services Pty Limited
Centuria Canberra No. 3 Pty Limited
Centuria Capital Cirque Pty Limited
Centuria Capital Health Fund
Centuria Capital No. 2 Fund
Centuria Capital No. 2 Industrial Fund
Centuria Capital No. 2 Office Fund
Centuria Capital No. 3 Fund
Centuria Capital No. 4 Fund
Centuria Capital No. 5 Fund
Centuria Capital No. 6 Fund
Centuria Capital No. 7 Fund
Centuria Capital No. 8 Fund
Centuria Capital No. 9 (PW) Fund (formerly known as Primewest Property Fund)
Centuria Developments (Cardiff) Pty Limited
Centuria Developments (Mann Street) Pty Limited
Centuria Developments (Mayfield) Pty Limited
Centuria Developments (Young Street) Pty Limited
Centuria Developments Pty Limited
Centuria Employee Share Fund Pty Ltd
Centuria Finance Pty Ltd
Ownership interest %
30 June 2023
30 June 2022
0% (100% NCI)
0% (100% NCI)
100%
100%
59%
100%
100%
100%
100%
100%
100%
0%
0%
0%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
64%
100%
100%
100%
100%
100%
100%
42%
50%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Australian subsidiaries
Centuria Funds Management Limited
Centuria Healthcare Asset Management Limited1
Cudgen Health Precinct Pty Limited
Cudgen Health Precinct SPV Trust
Centuria Lane Cove Debt Fund
Centuria Tweed Valley Developments Pty Limited
Centuria Healthcare Asset Management Nominee 1 Pty Ltd1
Centuria Healthcare Energy Company Pty Ltd1
Centuria Healthcare Funds Distributions Limited1
Centuria Healthcare Investments Pty Ltd1
Centuria Healthcare Property Services Pty Limited
Centuria Healthcare Pty Ltd
Centuria Healthcare Developments Pty Ltd
Centuria Healthcare Asset Management Nominee 2 Pty Ltd
Centuria Industrial Property Services Pty Ltd
Centuria Institutional Investments No. 3 Pty Limited
Centuria Investment Holdings No. 4 Pty Limited
Centuria Investment Holdings Pty Limited
Centuria Investment Management (CDPF) Pty Ltd
Centuria Investment Management (CIP) Pty Ltd
Centuria Investment Management (CMA) No. 2 Pty Limited
Centuria Investment Management (CMA) Pty Limited
Centuria Investment Management (Property) No. 1 Pty Ltd
Centuria Investment Management (Property) No. 2 Pty Ltd
Centuria Investment Management (Property) No. 3 Pty Ltd
Centuria Investment Management (Property) No. 4 Pty Ltd
Centuria Investment Management (Property) No. 5 Pty Ltd
Centuria Investment Services Pty Limited
Centuria IM Agri No. 1 Pty Limited
Centuria IM Agri No. 2 Pty Limited
Centuria IM Agri No. 3 Pty Limited
Centuria IM Agri No. 4 Pty Limited
Centuria Life Limited
Centuria Nominees No. 3 Pty Limited
Centuria Platform Investments Pty Limited
Centuria Prime Partnership Pty Ltd
Centuria Prime Partnership No.1 Pty Ltd
Centuria Prime Partnership No.2 Pty Ltd
Centuria Properties No. 3 Limited
Centuria Property Funds Limited
Centuria Property Funds No. 2 Limited
Centuria Property Funds No. 3 Limited
Centuria Property Funds No. 4 Limited
Centuria Property Services Pty Limited
Notes to the financial statements
Ownership interest %
30 June 2023
30 June 2022
100%
59%
50.1%
50.1%
100%
100%
59%
59%
59%
59%
59%
59%
59%
59%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
64%
50.1%
50.1%
100%
100%
64%
64%
64%
64%
64%
64%
64%
64%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
0%
0%
100%
100%
100%
100%
100%
100%
148 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 149
Notes to the financial statements
Australian subsidiaries
Centuria Richlands Pty Ltd
Centuria SubCo Pty Limited
CHPF 1 Pty Ltd
CHPF 2 Pty Ltd
CHPF 3 Pty Ltd
CHPF Cairns Pty Ltd
CHPF Kallangur Pty Ltd
CHPF South Bunbury Pty Ltd
Crestway Nominees Pty Ltd
Forrestdale Home Pty Ltd
Fromnex Pty Limited
Heathley Finance Company Pty Ltd1
Heathley Funds Management Pty Ltd1
Heathley Investor Services Pty Limited1
Heathley Nominees Pty Ltd1
Just across the river Pty Ltd
Mainriver Holdings Pty Ltd
More than meets the eye Pty Ltd
Over Fifty Capital Pty Ltd
Over Fifty Funds Management Pty Ltd
Over Fifty Investments Pty Ltd
Over Fifty Seniors Equity Release Pty Ltd
Centuria WA (1 Forrest Place) Pty Ltd
Centuria WA (1060 Hay Street) Pty Ltd
Centuria WA (15 Ogilvie Road) Pty Ltd
Centuria WA (307 Murray Street) Pty Ltd
Centuria WA (359 Scarborough Beach Road) Pty Ltd
Centuria WA (380 Scarborough Beach Road) Pty Ltd
Centuria WA (380A Scarborough Beach Road) Pty Ltd
Centuria WA (382 Scarborough Beach Road) Pty Ltd
Centuria WA (384 Scarborough Beach Road) Pty Ltd
Centuria WA (511 Abernethy Road) Pty Ltd
Centuria WA (607 Bourke Street) Pty Ltd
Centuria WA (616 St Kilda Road) Pty Ltd
Centuria WA (Australia Place) Pty Ltd
Centuria WA (Busselton) Pty Ltd
Centuria WA (Cannington) Pty Ltd
Centuria WA (Cottesloe Central) Pty Ltd
Centuria WA (Erskine) Pty Ltd
Centuria WA (Gauge Circuit) Pty Ltd
Centuria WA (Hillbert Road) Pty Ltd
Centuria WA (Joondalup House) Pty Ltd
Centuria WA (Lot 4 Davidson Street Kalgoorlie) Pty Ltd
Centuria WA (Melville) Pty Ltd
Ownership interest %
30 June 2023
30 June 2022
Australian subsidiaries
Notes to the financial statements
Ownership interest %
30 June 2023
30 June 2022
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
59%
59%
59%
59%
100%
100%
0%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
31.5%
64%
64%
64%
64%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Centuria WA (Neerabup) Pty Ltd3
Centuria WA (Northlands) Pty Ltd
Centuria WA (Osborne Park) Pty Ltd
Centuria WA (Wattleup) Pty Ltd
Centuria WA Agrichain Management Pty Ltd
Centuria WA Corporate Holdings Pty Ltd
Centuria WA Enterprises Pty Ltd
Centuria WA Pty Limited
Centuria WA P/Q Pty Ltd
Centuria WA Real Estate Pty Ltd
Centuria WA USA Holdings Pty Ltd
Centuria WA Property Pty Ltd
DCA Projects Pty Limited
Exercise Holdings Pty Ltd
Primewest (135 Clayton Street) Pty Limited
Primewest 140 STG Trust
Primewest USA Trust
Riodell Holdings Pty Ltd
Senex Warehouse Trust No. 1
Silverkey Pty Ltd
Stead Road Pty Ltd
SVAF II Head Co Pty Ltd
SVAF II Mid Co Pty Ltd
SVAF Property Co Pty Ltd
Teewana Farm Pty Ltd3
Zimara Enterprises Pty Ltd
NEW ZEALAND SUBSIDIARIES
Centuria Capital (NZ) Limited (formerly Centuria New Zealand Holdings Limited)
Centuria Capital (NZ) No. 1 Limited (formerly Augusta Capital Limited)
Centuria Capital (NZ) No. 2 Limited (formerly Augusta Capital No. 1 Limited)
Centuria Funds Management (NZ) Limited (formerly Augusta Funds Management
Limited)
Centuria Lakeview Holdings Limited (formerly Augusta Lakeview Holdings
Limited)
Centuria Property Holdco Limited (formerly Augusta Property Holdco Limited)
0%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
0%
0%
100%
100%
100%
100%
100%
100%
100%
100%
SINGAPORE SUBSIDIARIES
Centuria Capital Private Limited (Singapore)
100%
100%
1. The ownership percentage outlined above for these subsidiaries reflects the Group’s economic ownership. The Group holds a 50% voting right in each
of these subsidiaries.
2. During the period Centuria 111 St Georges Terrace Fund was deconsolidated and is now a financial asset with a holding of 18.06%.
3. These entities were disposed by the Group on 30 June 2023.
150 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 151
Notes to the financial statements
(a) Guarantees entered into by the parent entity
The parent entity has, in the normal course of business, entered into guarantees in relation to the debts of its subsidiaries
during the financial year.
(b) Commitments and contingent liabilities of the parent entity
The parent entity has bank guarantees of $2,007,143 for commercial leases with respect to its Sydney and Melbourne
office premises. These bank guarantees are cash collateralised.
The above guarantees are issued in respect of the parent entity and do not constitute an additional liability to those
already existing in liabilities on the statement of financial position.
The directors of the Company are not aware of any other contingent liabilities in relation to the parent entity, other than
those disclosed in the financial statements.
Notes to the financial statements
Recognition and measurement
1. Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the
Company. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity
and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included
in the consolidated financial statements from the date on which control commences until the date on which control ceases.
Intra-group balances and transactions and any unrealised income and expenses arising from intra-group transactions are
eliminated in preparing the consolidated financial statements.
The Company is required by AASB 10 Consolidated Financial Statements to recognise the assets, liabilities, income,
expenses and equity of the Benefit Funds of its subsidiary, Centuria Life Limited (the Benefit Funds). The assets and
liabilities of the Benefit Funds do not impact the net profit after tax or the equity attributable to the securityholders of the
Company and the securityholders of the Company have no rights over the assets and liabilities held in the Benefit Funds.
In order to reflect the assets and liabilities pertaining to the Benefit Funds being attributable to policyholders (as approved
by securityholders) an equal and offsetting policyholder liability is recognised on consolidation. In addition, on consolidation
of the various income and expenses attributable to the Benefit Funds an equal and opposite net change in policyholder
liabilities is recorded in the statement of comprehensive income.
The Company has majority representation on the Board of the Over Fifty Guardian Friendly Society Limited (Guardian).
However, as Guardian is a mutual organisation, the Company has no legal rights to Guardian's net assets, nor does it derive
any benefit from exercising its power and therefore does not control Guardian.
E3
Parent entity disclosure
As at, and throughout the current and previous financial year, the parent entity of the Group was Centuria Capital Limited.
RESULT OF PARENT ENTITY
Profit for the year
Total comprehensive income for the year
FINANCIAL POSITION OF PARENT ENTITY AT YEAR END
Total assets
Total liabilities
Net assets
2023
$'000
2022
$'000
6,936
6,936
23,561
23,561
1,120,216
1,147,511
(452,156)
(465,339)
668,060
682,172
The parent entity classifies its assets and liabilities as current, except for the parent entity's investments in subsidiaries.
The assets of the parent entity mainly consist of cash, short term receivables, investments in subsidiaries and deferred tax
assets. The parent entity's investment in subsidiaries are measured at cost. The liabilities of the parent entity mainly consist
of short term payables.
TOTAL EQUITY OF THE PARENT ENTITY COMPRISING OF:
Share capital
Share-based incentive reserve
Retained earnings
Total equity
394,811
11,016
262,233
668,060
389,716
8,931
283,526
682,173
152 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 153
Notes to the financial statements
F Other
F1
Share-based payment arrangements
(a) LTI plan details
The Company has an executive incentive plan (LTI Plan) which forms a key element of the Company’s incentive and
retention strategy for senior executives under which Performance Rights (Rights) are issued.
Each employee receives ordinary securities of the Group on vesting of the Performance Rights. No amounts are paid or
payable by the recipient on receipt of the Performance Rights or on vesting. The Performance Rights carry neither rights to
dividends nor voting rights prior to vesting.
It is expected that future annual grants of Performance Rights will be made, subject to the Board’s determination of the
overall performance of the Group and market conditions. The vesting of any Performance Rights awarded will be subject to
attainment of appropriate performance hurdles and on the basis of continuing employment with the Group.
Further details of the LTI Plan are included in the Audited Remuneration Report from page 74 to page 97.
Performance Rights outstanding at the beginning of the year
Performance Rights granted during the year
Performance Rights lapsed during the year
Performance Rights vested during the year
Performance Rights outstanding at the end of the year
2023
$'000
2022
$'000
9,858,881
8,960,099
4,766,656
3,196,360
(2,101,132)
-
(700,375)
(2,297,578)
11,824,030
9,858,881
The performance objectives for 3,939,056 of the Performance Rights issued under Tranche 8 were not met as at 30 June
2023. As a result all rights will lapse.
(b) Measurement of fair values
The fair value of the rights was calculated using a binomial tree valuation methodology for the Rights with non-market
vesting conditions and a Monte-Carlo simulation for the Rights with market vesting conditions.
The inputs used in the measurement of the fair values at grant date of the rights were as follows:
Tranche 8
Tranche 9
Tranche 10
Expected vesting date
31 August 2023
31 August 2024 and
31 August 2025
31 August 2025 and
31 August 2026
Share price at the grant date
$2.51 and $2.37
$3.13 and $3.25
$1.825 and $1.935
Expected life
Volatility
2.8 years
26%
2.8–4.1 years
2.7–4.1 years
26%
30%
Risk free interest rate
0.11% and 0.12%
0.11% and 0.86%
2.99% and 3.16%
Dividend yield
4.2%
3.8%
5.3%
The following table sets out the fair value of the rights at the respective grant date:
Performance Condition
Tranche 8
Tranche 9
Tranche 10
Absolute TSR
Relative TSR
$1.29 and $1.101
$1.75 and $1.582
$1.85 and $2.153
$1.16 and $1.324
$0.51 and $0.695
$0.64 and $0.836
1. $1.29 for Chief Executive Officers and $1.10 for other employees.
2. $1.75 for Chief Executive Officers and $1.58 for other employees.
3. $1.85 and $1.92 for Chief Executive Officers, $1.98 and $2.05 for senior executive committee members and $2.15 for other employees.
4. $1.16 and $1.18 for Chief Executive Officers, $1.19 and $1.23 for senior executive committee members and $1.32 for other employees.
5. $0.51 and $0.53 for Chief Executive Officers, $0.65 and $0.69 for senior executive committee members and $0.69 for other employees.
6. $0.64 and $0.68 for Chief Executive Officers, $0.79 and $0.83 for senior executive committee members and $0.83 for other employees.
During the year, share based payment expenses were recognised of $5,055,000 (2022: $5,010,000).
Notes to the financial statements
Recognition and measurement
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of
the equity instruments at the grant date.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line
basis over the vesting period, based on the Group’s estimate of equity instruments that will eventually vest. At the end of
each reporting period, the Group revises its estimate of the number of equity instruments expected to vest. The impact
of the revision of the original estimates with respect to non-market vesting conditions, if any, is recognised in profit for
the year such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to the equity-
settled employee benefits reserve.
F2
Financial instruments
(a) Management of financial instruments
The Board is ultimately responsible for the Risk Management Framework of the Group.
The Group employs a cascading approach to managing risk, facilitated through delegation to specialist committees and
individuals within the Group.
The Group is exposed to a variety of financial risks as a result of its activities. These risks include market risk (including
interest rate risk and price risk), credit risk and liquidity risk. The Group's risk management and investment policies,
approved by the Board, seek to minimise the potential adverse effects of these risks on the Group's financial performance.
These policies may include the use of certain financial derivative instruments.
Centuria Group has various investment committees to oversee the relevant entity’s investment and portfolio management
practices to ensure they are in line with the risk and return requirements of its investors, as well as ensuring that
investment decisions are made in accordance with the appropriate regulatory requirements. The Centuria Life investment
committee in particular monitor fund rules and target achieving the long-term strategic objectives of investors.
From time to time, the Group outsources certain parts of the investment management of the Benefit Funds to specialist
investment managers including co-ordinating access to domestic and international financial markets, and managing the
financial risks relating to the operations of the Group in accordance with an investment mandate set out in the Group's
constitution and the Benefit Funds' product disclosure statements. The Benefit Funds' investment mandates are to invest
in equities and fixed interest securities via unit trusts, discount securities and may also invest in derivative instruments
such as futures and options.
The Group uses interest rate swaps to manage interest rate risk and not for speculative purposes in any situation. Hedging
is put in place where the Group is either seeking to minimise or eliminate cash-flow variability, i.e. converting variable rates
to fixed rates, or changes in the fair values of underlying assets or liabilities, i.e. to convert fixed rates to variable rates.
Derivative financial instruments of the Benefit Funds, consolidated into the financial statements of the Group under AASB
10 Consolidated Financial Statements, are used only for hedging factual or anticipated exposures relating to investments.
The use of financial derivatives in respect of Benefit Funds is governed by the Benefit Funds' investment policies, which
provide written principles on the use of financial derivatives.
(b) Capital risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while
maximising the return to stakeholders through the optimisation of debt and equity capital. This overall strategy remains
unchanged from the prior year.
The Group's capital structure consists of net debt (borrowings, offset by cash and cash equivalents) and equity of the
Group (comprising issued capital, reserves and retained earnings).
The Group carries on business throughout Australia and New Zealand, primarily through subsidiary companies that
are established in the markets in which the Group operates. The operations of CLL are regulated by APRA and the
management fund of CLL has a minimum Prescribed Capital Amount (PCA) that must be maintained at all times. It is
calculated monthly and these results are reported to the Board each month. The current level of share capital of CLL
meets the PCA requirements.
In addition, Centuria Property Funds Limited, Centuria Funds Management Limited, Centuria Property Funds No. 2 Limited,
Centuria Healthcare Asset Management Limited, Centuria Property Funds No. 3 Limited and Centuria Property Funds No. 4
Limited have AFS licences so as to operate registered property trusts. Regulations require these entities to hold a minimum
net asset amount which is maintained by way of cash term deposits and listed liquid investments.
154 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 155
Notes to the financial statements
Notes to the financial statements
• Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are
Call/Put option liability
Amortised cost Not applicable
Operating cash flows are used to maintain and where appropriate, expand the Group's funds under management as well as
to make the routine outflows of tax, dividends and repayment of maturing debt. The Group regularly reviews its anticipated
funding requirements and the most appropriate form of funding (capital raising or borrowings) depending on what the
funding will be used for.
The capital structure of the Benefit Funds (and management fund) consists of cash and cash equivalents, bill facilities and
mortgage assets. The Benefit Funds also hold a range of financial assets for investment purposes including investments
in unit trusts, equity and floating rate notes. The Investment Committee aims to ensure that there is sufficient capital for
possible redemptions by policyholders of the Benefit Funds by regularly monitoring the level of liquidity in each fund.
The Benefit Funds have no restrictions or specific capital requirements on the application and redemption of units. The
Benefit Funds' overall investment strategy remains unchanged from the prior year.
(c) Fair value of financial instruments
1. Fair value measurements recognised in the statement of financial position
The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their
levels in the fair value hierarchy for financial instruments measured at fair value.
The table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value,
grouped into Levels 1 to 3 based on the degree to which the fair value is observable.
• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets
or liabilities.
observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
• Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability
that are not based on observable market data (unobservable inputs).
There were no transfers between Level 1, 2 and 3 in the period.
Unless outlined below, detailed information in relation to recognition and measurement principals applied across all
financial instruments are outlined in the respective notes accompanying the balance sheet.
30 June 2023
FINANCIAL ASSETS
Cash and cash equivalents
Receivables
Financial assets
Financial assets
Financial assets - mortgage backed assets
Reverse mortgages receivables
Financial assets
Measurement
basis
Fair value
hierarchy
Carrying amount
$'000
Far value
$'0001
Amortised cost Not applicable
Amortised cost Not applicable
Fair value
Fair value
Fair value
Fair value
Level 1
Level 2
Level 3
Level 3
Amortised cost Not applicable
225,460
133,278
630,078
221,427
1,181
41,887
45,160
225,460
133,278
630,078
221,427
1,181
41,887
45,160
1,298,471
1,298,471
FINANCIAL LIABILITIES
Payables
Amortised cost Not applicable
Benefit Funds policy holders' liability
Amortised cost Not applicable
Borrowings (net of borrowing costs)
Amortised cost Not applicable
Interest rate swaps - reverse mortgage fixed-for-life
Fair value
Level 3
Call/Put option liability
Amortised cost Not applicable
1. For financial asset amounts classified at amortised cost, the fair value amount is equal to the carrying amount.
92,418
278,793
375,217
19,339
38,255
92,418
278,793
371,368
19,339
-
804,022
761,918
30 June 2022
FINANCIAL ASSETS
Cash and cash equivalents
Receivables
Financial assets
Financial assets
Financial assets - mortgage backed assets
Reverse mortgages receivables
Financial assets2
Measurement
basis
Fair value
hierarchy
Carrying amount
$'000
Far value
$'0001
Amortised cost Not applicable
200,565
200,565
Amortised cost Not applicable
Fair value
Fair value
Fair value
Fair value
Level 1
Level 2
Level 3
Level 3
Amortised cost Not applicable
FINANCIAL LIABILITIES
Payables
Amortised cost Not applicable
Benefit Funds policy holders' liability
Amortised cost Not applicable
Borrowings (net of borrowing costs)
Amortised cost Not applicable
Interest rate swaps - reverse mortgage fixed-for-life
Fair value
Level 3
113,487
685,211
165,171
1,181
40,084
70,045
113,487
685,211
165,171
1,181
40,084
70,045
1,275,744
1,275,744
134,619
270,558
629,385
18,750
84,095
134,619
270,558
624,941
18,750
-
1,137,407
1,048,868
1. For financial asset amounts classified at amortised cost, the fair value amount is equal to the carrying amount.
2. Prior year numbers have been represented to reflect current year presentation.
2. Valuation techniques and assumptions applied in determining fair value
The fair values of financial assets and financial liabilities with standard terms and conditions and traded on active liquid
markets are determined with reference to quoted market prices (includes listed redeemable notes, bills of exchange,
debentures and perpetual notes).
The fair values of other financial assets and financial liabilities (excluding derivative instruments) are determined in
accordance with generally accepted pricing models based on discounted cash flow analysis using prices from observable
current market transactions and dealer quotes for similar instruments. Discount rates are determined based on market
rates applicable to the financial asset or liability.
The fair values of derivative instruments are calculated using quoted prices. Where such prices are not available,
discounted cash flow analysis is performed using the applicable yield curve for the duration of the instruments for non-
optional derivatives, and option pricing models for optional derivatives.
Level 2 fair values:
The Group determines Level 2 fair values for financial assets, which are investments in unlisted securities, by giving
consideration to the unit prices and net assets of the underlying funds. The unit prices and net asset values are largely
driven by the fair values of investment properties and derivatives held by the funds.
Level 3 fair values:
The Level 3 financial asset held by the Group is the fair value of the residential mortgage receivables attributable to interest
rate risk. The Level 3 financial liability held by the Group is the fixed-for-life interest rate swaps.
The fair value of the 50-year residential mortgage loans and 50-year swaps are calculated using a valuation technique
based on assumptions that are not supported by prices from observable current market transactions in the same
instrument and not based on available observable market data due to the illiquid nature of the instruments. A discounted
cash flow model is used for analysis using the applicable yield curve out to 20 years, with the yield curve at 20 years
employed as the best proxy for subsequent rates due to non-observable market data and to reflect the average remaining
life expectancy of the borrowers.
The valuation technique used to determine the fair value of the Group's reverse mortgage loan book is as follows:
• the weighted average reverse mortgage holders’ age is 83 years;
• the future cash flows calculation is related to borrowers' mortality rates and mortality improvements. The data is sourced
from mortality tables sourced from externally published data.
156 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 157
Notes to the financial statements
Notes to the financial statements
• fixed or variable interest rates charged to borrowers are used to project future cash flows;
• a redemption rate, which is based on historical loan redemption experience, applies to future cash flow forecast; and
• year-end yield curve plus a credit margin is used to discount future cash flows back to 30 June 2023 to determine the fair
value.
Key estimates and judgements
Assumptions and inputs used for valuation of reverse mortgage loan receivables:
• the loan interest compounding period is the expected remaining life of the borrower;
• mortality rates for males and females are based on portfolio-adjusted 2013-2015 Life Tables;
• the compounding interest rate is the fixed rate of loan for the period from day 1 up to the point of time when loan carrying
amount equals the property value. After that point of time, the loan compounding rate will be reduced to the same as
long term residential property growth rate determined by Management, on the grounds that any fixed rate exceeding the
property growth rate will not be recovered after that point of time;
• for 30 June 2023 valuation, the property growth rates are nil% for FY23, then reverted to a 3.5% flat rate from FY24 onwards;
• discount factors are calculated based on the market quoted long term rates on 30 June 2023;
(d) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral
or other security, where appropriate, as a means of mitigating risk of financial loss from default. The credit risk on financial
assets of the Group and the parent recognised in the statement of financial position is generally the carrying amount, net
of allowance for impairment loss.
Concentration of risk may exist when the volume of transactions limits the number of counterparties.
1. Credit risk of reverse mortgages
Concentration of credit risk in relation to reverse mortgage loans is minimal, as each individual reverse mortgage loan
is secured by an individual residential property. The loan is required to be settled from the proceeds of disposal of the
secured property after the borrower's death.
Individual property valuations are conducted at least every 3 years in accordance with financier's requirements. At 30 June
2023, the highest loan to value ratio (LVR) of a loan in the reverse mortgage loan book is 141% (2022: 129%), and there are
41 out of 154 (2022: 72 out of 166) reverse mortgage loans where the LVR is higher than 50%.
• the 1% flat credit risk premium, reflecting the portfolio default profile on 30 June 2023, is added to the monthly cash flow
2. Credit risk on other financial assets
discount factors to discount future cash flows generated by the reverse mortgage loans.
Assumptions and inputs used for valuation of the 50-year interest rate swaps:
• mortality rates for males and females based on portfolio-adjusted 2013-2015 Life Tables. The improvement factor tapers
down to 1% p.a. at age 90 and then zero at age 100;
• joint life mortality is calculated based on last death for loans with joint borrowers;
• 48% of the residential mortgage loan portfolio consists of joint lives;
• discount factors are calculated based on the market quoted long term rates on 30 June 2023;
• the 1.676% flat credit risk premium, reflecting the business default profile on 30 June 2023, is added to the monthly cash
flow discount factors to discount future cash flows generated by the reverse mortgage loans.
Recognition and measurement
The Group enters into derivative financial instruments such as interest rate swaps to manage its exposure to interest rate risk.
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently
remeasured to their fair value at each reporting period. The resulting gain or loss is recognised in profit or loss immediately
unless the derivative is designated and effective as a hedging instrument, in which event, the timing of the recognition in
profit or loss depends on the nature of the hedge relationship.
3. Reconciliation of Level 3 fair value measurements of financial assets and liabilities
Year ended 30 June 2023
Balance at 1 July 2022
Loan repaid
Accrued interest
Attributable to interest rate and other risk
Attributable to credit risk
Balance at 30 June 2023
Year ended 30 June 2022
Balance at 1 July 2021
Loan repaid
Accrued interest
Attributable to interest rate and other risk
Attributable to credit risk
Balance at 30 June 2022
158 | Centuria Capital Group – Annual Report 2023
Other mortgage
backed assets at
fair value
$'000
Reverse
mortgages fair
value
$'000
Fixed-for-life
interest rate
swaps
$'000
1,181
-
-
-
-
40,084
(2,521)
3,001
1,139
184
(18,750)
742
(1,516)
278
(93)
Total
$'000
22,515
(1,779)
1,485
1,417
91
1,181
41,887
(19,339)
23,729
Other mortgage
backed assets at
fair value
$'000
Reverse
mortgages fair
value
$'000
Fixed-for-life
interest rate
swaps
$'000
1,181
-
-
-
-
1,181
54,309
(3,824)
3,413
(17,749)
3,935
40,084
(31,205)
1,206
(1,907)
14,503
(1,347)
(18,750)
Total
$'000
24,285
(2,618)
1,506
(3,246)
2,588
22,515
Credit risk on other financial assets such as investments in floating rate notes, standard discount securities and unit trusts
is managed through strategic asset allocations with creditworthy counterparties and the on-going monitoring of the credit
quality of investments, including the use of credit ratings issued by well-known rating agencies.
Loan receivable from related party:
As of 30 June 2023, the Group recognised a loss allowance of $1,275,000 for the related party loan receivable from
Centuria NZ Healthcare Property Fund (CNZHPF). The loss allowance was measured at the lifetime expected credit loss
from future possible scenarios and are probability weighted. The estimated scenarios and probabilities of loss are based on
the market data collected, Group's view of future economic conditions and CNZHPF's forecast business plan. This does not
have significant impact on the Group's credit risk exposure in other financial assets.
Receivables:
The exposure of credit risk in respect of financial assets remains minimal as the majority of other financial assets are due
from related parties of the Group. The Group does not have any significant credit risk exposure to any single entity in other
financial assets or any group of counterparties having similar characteristics.
The aging of receivables at the reporting date was as follows:
Not due
1 to 30 days
31 to 60 days
> 60 days overdue
2023
$'000
119,936
4,885
4,189
4,268
133,278
2022
$'000
97,877
11,453
1,655
2,503
113,488
(e) Liquidity risk
The Group's approach to managing liquidity is to ensure that it will always have sufficient liquidity to meet its liabilities.
The liquidity risk is managed for the Group at a corporate level. Bank account balances across all entities, current and
future commitments, and expected cash inflows are reviewed in detail when the monthly cash flow projection is prepared
for management purposes and presented to the Board at its regular monthly meetings. By comparing the projected cash
flows with the assets and liabilities shown in the individual and consolidated statements of financial position, which are
also prepared on a monthly basis for management purposes and presented to the Board, liquidity requirements for the
Group can be determined. Based on this review, if it is considered that the expected cash inflows plus liquidity on hand,
may not be sufficient in the near term to meet cash outflow requirements, including repayment of borrowings, a decision
can be made to carry out one or more of the following:
• renegotiate the repayment terms of the borrowings;
• sell assets that are held on the statement of financial position; and/or
• undertake an equity raising.
Centuria Capital Group – Annual Report 2023 | 159
Notes to the financial statements
Notes to the financial statements
This, combined with a profitable business going forward, should ensure that the Group continues to meet its commitments,
including repayments of borrowings, as and when required.
The Group's overall strategy to liquidity risk management remains unchanged from the prior year.
The policyholders in the Benefit Funds are able to redeem their policies at any time and the Benefit Funds are therefore
exposed to the liquidity risk of meeting policyholders' withdrawals at any time. The Investment Committee aims to ensure
that there is sufficient capital for possible redemptions by policyholders of the Benefit Funds by regularly monitoring the
level of liquidity in each fund.
The following table summarises the Group's remaining contractual maturity for its non-derivative financial liabilities with
agreed repayment periods. The tables have been prepared based on the undiscounted cash flows of financial liabilities
based on the earliest date on which the Group and the parent can be required to pay. The tables include both interest and
principal cash flows. To the extent that interest flows are at floating rate, the undiscounted amount is derived from interest
rate curves at the end of the reporting period.
Non-derivative financial liabilities
On demand
$'000
Less than
3 months
$'000
3 months to
1 year
$'000
1–5 years
$'000
5+ years
$'000
Total
$'000
2023
Borrowings
Payables
Call/Put option liability
-
-
-
Benefit Funds policyholder's liability
278,793
6,138
52,994
403,555
114,340
-
-
-
-
-
-
1,510
278,793
121,988
4,604
57,598
-
41,857
-
26,307
471,719
Lease liabilities
Total
2022
Borrowings
Payables
Call/Put option liability
Lease liabilities
Total
Benefit Funds policyholder's liability
270,557
8,242
28,531
697,617
-
-
-
-
134,619
35,400
-
805
270,557
179,066
-
-
-
2,447
30,978
-
58,929
-
13,175
769,721
-
-
-
-
11,916
11,916
-
-
-
-
6,820
6,820
462,687
114,340
41,857
278,793
44,337
942,014
734,390
134,619
94,329
270,557
23,247
1,257,142
The following table summarises the maturing profile of derivative financial liabilities. The table has been drawn up based on
the undiscounted net cash flows on the derivative instruments that settle on a net basis.
Derivative financial liabilities
2023
Interest rate swaps
Total
2022
Interest rate swaps
Total
On demand
$'000
Less than 3
months
$'000
3 months to 1
year
$'000
1-5 years
$'000
5+ years
$'000
Total
$'000
-
-
-
-
-
-
92
92
20
20
287
287
1,127
1,127
25,929
25,929
27,076
27,076
2,924
2,924
33,775
33,775
37,078
37,078
(f) Market risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes
in market prices. Market risk comprises interest rate risk and price risk. Due to the nature of assets held by the Group
(excluding the Benefit Funds), there is an asset and liability management process which determines the interest rate
sensitivity of the statement of financial position and the implementation of risk management practices to hedge the
potential effects of interest rate changes. The Group manages the market risk associated with its Benefit Funds by
outsourcing its investment management. The Investment Manager manages the financial risks relating to the operations of
the Benefit Funds in accordance with an investment mandate set out in the Benefit Funds’ constitution and PDS. There has
been no change to the Group's exposure to market risks or the manner in which it manages and measures the risk.
1. Equity price risk
The Group is exposed to equity price risk arising from investments held and classified as at fair value through profit or loss.
The exposure to equity price risk at the end of the reporting period, assuming equity prices had been 10% higher or lower
while all other variables were held constant, would increase/decrease net profit by $85.3 million (2022: $85.2 million).
2. Interest rate risk management
The Group is exposed to interest rate risk because entities in the Group borrow funds at floating interest rates.
Management of this risk is evaluated regularly and interest rate swaps are used accordingly.
The tables below detail the Group's interest bearing financial assets and liabilities.
2023
FINANCIAL ASSETS
Cash and cash equivalents
Other financial assets held by Benefit Funds
Other interest bearing loans
Reverse mortgage receivables
Total financial assets
FINANCIAL LIABILITIES
Borrowings
Total financial liabilities
Net interest bearing financial assets/(liabilities)
2022
FINANCIAL ASSETS
Financial assets
Cash and cash equivalents
Other financial assets held by Benefit Funds
Other interest bearing loans
Reverse mortgage receivables
Total financial assets
FINANCIAL LIABILITIES
Borrowings
Total financial liabilities
Net interest bearing financial assets/(liabilities)
Weighted
average effective
interest rate
%
Variable rate
$'000
Fixed rate
$'000
Total
$'000
4.04%
2.02%
4.90%
8.7%
202,918
3,216
-
672
22,542
5,866
47,129
41,215
225,460
9,082
47,129
41,887
206,806
116,752
323,558
7.54%
(275,810)
(275,810)
(69,004)
(99,407)
(99,407)
17,345
(375,217)
(375,217)
(51,659)
Weighted
average effective
interest rate
%
Variable rate
$'000
Fixed rate
$'000
Total
$'000
0.87%
2.56%
4.82%
8.71%
169,706
3,269
-
743
173,718
30,859
7,432
71,039
39,341
148,671
200,565
10,701
71,039
40,084
322,389
4.56%
(529,997)
(529,997)
(356,279)
(99,388)
(99,388)
(629,385)
(629,385)
49,283
(306,996)
160 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 161
Notes to the financial statements
3. Interest rate swap contracts
Under interest rate swap contracts, the Group agrees to exchange the difference between fixed and floating rate interest
amounts calculated on agreed notional principal amounts. Such contracts enable the Group to mitigate the risk of changing
interest rates on the fair value of fixed rate financial assets held and the cash flow exposures on the issued variable rate
debt.
The following table details the notional principal amounts and remaining expiry of the Group's outstanding interest rate
swap contracts as at reporting date. These swaps are at fair value through profit and loss.
Pay fixed for floating contracts
50 year swaps contracts
4. Interest rate sensitivity
Average contracted rate
Notional principal amount
Fair value
2023
%
7.47%
7.47%
2022
%
7.48%
7.48%
2023
$'000
7,992
7,992
2022
$'000
8,447
8,447
2023
$'000
2022
$'000
(19,339)
(18,750)
(19,339)
(18,750)
The sensitivity analysis below has been determined based on the parent and the Group's exposure to interest rates at the
balance date and the stipulated change taking place at the beginning of the financial year and held constant throughout the
reporting period, in the case of financial assets and financial liabilities that have variable interest rates. A 100 basis points
(1.00%) increase or decrease represents management's assessment of the reasonably possible change in interest rate.
At reporting date, if variable interest rates had been 100 (2022: 100) basis points higher or lower and all other variables
were held constant, the impact to the Group would have been as follows:
Change in variable
2023
Change in variable
2022
2023
$'000
2022
$'000
Effect on profit after tax
CONSOLIDATED
Interest rate risk
CONSOLIDATED
Interest rate risk
+1.00%
+1.00%
(1,866)
(4,004)
-1.00%
-1.00%
2,351
4,132
The sensitivity analysis takes into account interest-earning assets and interest-bearing liabilities attributable to the
securityholders only, and does not take into account the bank bill facility margin changes.
F3
Remuneration of auditors
Amounts received or due and receivable by KPMG:
Audit and review of the financial report
Other services including AFSL and compliance plan audits
Non-audit services
2023
$'000
926,643
151,415
30,096
2022
$'000
858,353
115,401
426,800
1,108,154
1,400,554
F4
Events subsequent to the reporting date
There has not arisen in the interval between 30 June 2023 and the date hereof any item, transaction or event of a material
and unusual nature likely, in the opinion of the directors of the Company, to affect significantly the operations of the Group,
the results of those operations, or the state of affairs of the Group, in future financial periods.
Directors' declaration
In the opinion of the Directors' of Centuria Capital Limited:
a.
the consolidated financial statements and notes set out on pages 100 to 162 and the Remuneration
Report set out on pages 74 to 97 in the Directors' Report, are in accordance with the Corporations Act
2001, including:
i.
complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory
professional reporting requirements, and
ii. giving a true and fair view of the Group's financial position as at 30 June 2023 and of its
performance for the financial year ended on that date, and
b.
there are reasonable grounds to believe that the Group will be able to pay its debts as and when they
become due and payable.
Note A1 confirms that the consolidated financial statements also comply with International Financial
Reporting Standards as issued by the International Accounting Standards Board.
The Directors have been given the declarations by the Joint Chief Executive Officers and Chief Financial
Officer required by section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of Director
Mr Garry S. Charny
Director
Peter Done
Director
Sydney
18 August 2023
162 | Centuria Capital Group – Annual Report 2023
163 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 163
LISTED: 6-8 MUNROE LANE, AUCKLAND NZ
Independent Auditor's report
Independent Auditor's report
Independent Auditor’s Report
To the stapled security holders of Centuria Capital Group
Report on the audit of the Financial Report
Opinion
We have audited the Financial Report of
Centuria Capital Group (the Stapled Group
Financial Report).
In our opinion, the accompanying Stapled
Group Financial Report is in accordance
with the Corporations Act 2001, including:
•
•
giving a true and fair view of the
Stapled Group’s financial position as
at 30 June 2023 and of its financial
performance for the year ended on
that date; and
complying with Australian Accounting
Standards and the Corporations
Regulations 2001.
The Financial Report of the Stapled Group comprises:
• Consolidated statement of financial position as at 30
June 2023
• Consolidated statement of comprehensive income,
Consolidated statement of changes in equity, and
Consolidated statement of cash flows for the year
then ended
• Notes including a summary of significant accounting
policies
• Directors’ Declaration
The Stapled Group consists of Centuria Capital Limited
and the entities it controlled at the year-end or from
time to time during the financial year and Centuria
Capital Fund and the entities it controlled at the year-
end or from time to time during the financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for
the audit of the Financial Report section of our report.
We are independent of the Stapled Group, Centuria Capital Limited and Centuria Funds Management
Limited (as Responsible Entity for Centuria Capital Fund) in accordance with the Corporations Act
2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the
Code) that are relevant to our audit of the Financial Report in Australia. We have fulfilled our other
ethical responsibilities in accordance with these requirements.
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated
with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and
logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited by
a scheme approved under Professional Standards Legislation.
Key Audit Matters
The Key Audit Matters we identified for
the Stapled Group are:
• Recognition of performance fee
income; and
• Recoverable amount of goodwill and
indefinite life management rights.
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.
Recognition of performance fee income ($28.5m)
Refer to Note B2 to the Financial Report
The key audit matter
How the matter was addressed in our audit
The Stapled Group, in its capacity as a
property fund manager, receives
performance fees where the managed
property fund outperforms a set
internal rate of return benchmark
(hurdle rate). Performance fees are
recognised by the Stapled Group when
they are deemed to be highly probable
and the amount of the performance
fees will not result in a significant
reversal in future periods.
Recognition of performance fee
income is a key audit matter due to
the:
•
Significant judgement exercised by us to
assess the amount of performance fee
income estimated by the Stapled Group.
The key assumptions impacting the
amount of performance fee income are
subject to estimation uncertainty, bias
and inconsistent application. This
increases the risk of inaccurate forecasts
or a wider range of possible outcomes
for us to consider. Increased time and
effort is spent by the audit team in
assessing these key assumptions; and
• Quantum of performance fee income,
representing 7.7% of the Stapled
Group’s total revenue.
In performing our procedures, we:
•
•
•
Inspected a sample of the Stapled
Group’s agreements with managed
property funds to understand the key
terms related to performance fees,
including hurdle rates.
Evaluated the Stapled Group’s
accounting policies regarding the
recognition of performance fee income
against accounting standard
requirements. This included assessing
the Stapled Group’s policies for
constraining performance fee income
and valuing investment properties
against accounting standard
requirements.
Assessed the scope, competence and
objectivity of the investment property
valuers to fair value the underlying
investment properties held by the funds.
• Obtained a sample of the investment
property valuations and challenged key
property fair value assumptions such as
capitalisation rates and market rental yields.
To do this, we used market analysis
published by industry experts, recent
market transactions, historical performance
of the underlying investment properties and
our industry experience, taking into account
164 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 165
Independent Auditor's report
Independent Auditor's report
We focused on the following key
assumptions made by the Stapled Group
in estimating the amount of performance
fee income including:
•
•
•
Fair value of underlying properties held.
The valuation of investment properties
contains assumptions with estimation
uncertainty such as expected
capitalisation rates and market rental
yields. This leads to additional audit
effort due for us to assess the differing
assumptions based on asset classes,
geographies and characteristics of
individual investment properties.
Forecast fund end date - The fund end
date impacts the level of returns that
can be achieved over the course of the
funds life and may change depending on
the Stapled Group’s strategy.
Constraint - This is impacted by the
Stapled Group’s expectations of how
much of the performance fee is highly
probable of being received with
reference to the remaining tenure of the
fund in accordance with accounting
standard requirements.
asset classes, geographies and
characteristics of individual investment
properties. We assessed the valuation
methodology used against accounting
standard requirements and industry
practice.
Assessed the Stapled Group’s
determination of the forecast fund end date
against a sample of the underlying
managed property fund agreements, the
Stapled Group’s fund strategy and history
of extending fund term end dates.
Recalculated a sample of the Stapled
Group’s performance fee income based on
hurdles in the underlying performance fee
agreements with managed property funds
and compared to the performance fee
income recorded in the Stapled Group’s
general ledger.
Challenged the constraints applied by the
Stapled Group. We used our knowledge of
the Stapled Group, their past performance,
business, and our industry experience to
inform our expectations of current and
forecast property fund performance and
likelihood of performance fees being
received.
Assessed the appropriateness of
disclosures in the Financial Report, using
our understanding obtained from our
testing and against the requirements of the
accounting standards.
•
•
•
•
Recoverable amount of goodwill and indefinite life management rights ($793.1m)
Refer to Note C6 to the Financial Report
The key audit matter
How the matter was addressed in our audit
A key audit matter is the Stapled Group’s
testing of goodwill and indefinite life
management rights for impairment, given
the size of the balance (being 34.0% of total
assets).
We focused on the significant forward-
looking assumptions the Stapled Group
applied in their value in use model,
including:
•
Forecast operating cash flows (including
In performing our procedures, we:
•
•
Considered the appropriateness of the
value in use method applied by the Stapled
Group, to perform its impairment test of
goodwill and indefinite life management
rights against the requirements of the
accounting standards.
Assessed the integrity of the value in use
model used, including the accuracy of the
revenue and expenses), growth rates
and terminal growth rates. The Stapled
Group’s model is sensitive to changes
in these assumptions, which may
reduce available headroom. This drives
additional audit effort specific to their
feasibility and consistency of application
to the Stapled Group’s strategy.
• Discount rate - this is complicated in
nature and varies according to the
conditions and environment the specific
Cash Generating Unit (CGU) is subject to
from time to time. The Stapled Group’s
modelling is highly sensitive to changes
in the discount rate.
We exercised significant judgement in
assessing the value in use estimated by the
Stapled Group. The key assumptions
impacting the value in use are subject to
estimation uncertainty and bias. This
increases the risk of inaccurate forecasts or a
wider range of possible outcomes for us to
consider. Increased time and effort is spent
by the audit team in assessing these key
assumptions.
We involved valuation specialists to
supplement our senior audit team
members in assessing this key audit
matter.
•
•
•
underlying calculation formulas.
Assessed the accuracy of previous Stapled
Group forecasts to inform our evaluation of
forecasts incorporated in the model.
Compared the cash flows, including
revenue and expenses contained in the
value
in use model to the Board
approved forecast.
Challenged the Stapled Group’s
significant forecast cash flow and growth
assumptions by:
- Assessing baseline cash flows,
including revenue and expenses by
comparing to actual historic cash
flows and key events to the Board
approved plan and strategy.
- With the assistance of our valuation
specialists, comparing growth rates and
terminal growth rates to published
studies of industry trends and
expectations, and considered
differences to the Stapled Group’s
operations. We used our knowledge of
the Stapled Group, their past
performance, business and customers,
and our industry experience.
- Checking the consistency of the
forecast growth rates to the Stapled
Group’s stated plan and strategy, past
performance of the Stapled Group and
our experience regarding the feasibility
of these in the economic environment
in which they operate.
• Worked with our valuation specialists to
independently developed a discount rate
range considering publicly available market
data for comparable entities, adjusted by
risk factors specific to the Stapled Group
and the industry it operates in.
•
Considered the sensitivity of the model
by varying key assumptions, such as
forecast growth rates, terminal growth
rates and discount rates, within a
reasonably possible range. We
considered the interdependencies of key
assumptions when performing the
sensitivity analysis and what the Stapled
Group consider to be reasonably
possible. We did this to identify those
assumptions at higher risk of bias or
166 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 167
Independent Auditor's report
Independent Auditor's report
inconsistency in application and to focus
our further procedures.
•
Assessed the disclosures in the financial
report using our understanding obtained
from our testing and against the
requirements of the accounting standards.
Other Information
Other Information is financial and non-financial information in Centuria Capital Group’s annual
reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Directors
of Centuria Capital Limited are responsible for the Other Information.
The Other Information we obtained prior to the date of this Auditor’s Report was the Directors’
Report, Remuneration Report, the Stock Exchange Appendix 4E and Additional stock exchange
information. Other than these items, the remaining other information included in the Centuria Capital
Group Annual Report is expected to be made available to us after the date of the Auditor's Report.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not
and will not express an audit opinion or any form of assurance conclusion thereon, with the exception
of the Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other
Information. In doing so, we consider whether the Other Information is materially inconsistent with
the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially
misstated.
We are required to report if we conclude that there is a material misstatement of this Other
Information, and based on the work we have performed on the Other Information that we obtained
prior to the date of this Auditor’s Report we have nothing to report.
Responsibilities of the Directors for the Financial Report
The Directors of Centuria Capital Limited are responsible for:
• preparing the Financial Report that gives a true and fair view in accordance with Australian
Accounting Standards and the Corporations Act 2001
•
•
implementing necessary internal control to enable the preparation of a Financial Report that gives
a true and fair view and is free from material misstatement, whether due to fraud or error
assessing the Stapled Group’s ability to continue as a going concern and whether the use of the
going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless they either
intend to liquidate the Stapled 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 objective is:
•
•
to obtain reasonable assurance about whether the Financial Report as a whole is free from
material misstatement, whether due to fraud or error; and
to issue an Auditor’s Report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with Australian Auditing Standards will always detect a material misstatement when it
exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the
Auditing and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our
Auditor’s Report.
Report on the Remuneration Report
Opinion
Directors’ responsibilities
In our opinion, the Remuneration Report
of Centuria Capital Limited for the year
ended 30 June 2023, complies with
Section 300A of the Corporations Act
2001.
The Directors of Centuria Capital Limited are
responsible for the preparation and presentation of the
Remuneration Report in accordance with Section 300A
of the Corporations Act 2001.
Our responsibilities
We have audited the Remuneration Report included in
pages 74 to 97 of the Directors’ report for the year
ended 30 June 2023.
Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
KPMG
Paul Thomas
Partner
Sydney
18 August 2023
168 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 169
Corporate governance statement
Additional stock exchange information
The corporate governance statement for CNI was last updated on
26 September 2023 and is available on the Centuria website at
centuria.com.au/centuria-capital/corporate/sustainability/governance.
The securityholder information set out below was applicable as at 18 July 2023.
Distribution of securities
Analysis of numbers of securityholders by size of holding:
Holding
1 - 1000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
There were 256 holders of less than a marketable parcel of securities holding 8,149 securities.
Top 20 securityholders
The names of the twenty largest holders of securities are listed below:
Substantial unitholders
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
CITICORP NOMINEES PTY LIMITED
PENTEK HOLDINGS PTY LTD
NATIONAL NOMINEES LIMITED
CIRCLESTAR PTY LTD
BNP PARIBAS NOMS PTY LTD
MR PETER KARL CHRISTOPHER HULJICH & MR JOHN HAMISH BONSHAW IRVING
TOPSFIELD PTY LTD
MR C P HULJICH & MRS C M F HULJICH & P K C HULJICH
GH 2016 PTY LTD
CITICORP NOMINEES PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED >
HWM (NZ) HOLDINGS LIMITED
PARITAI PTY LIMITED
MR JASON TIMOTHY KILGOUR & MR VAUGHAN CHARLES ATKIN
RESOLUTE FUNDS MANAGEMENT
CHARTER HALL WHOLESALE MANAGEMENT LTD
MR PAT REDPATH O'CONNOR
RESOLUTE FUNDS MANAGEMENT
Number of
holders
Number of
securities
1,821
829,093
4,652
11,857,395
1,524
10,962,589
1,865
50,442,193
223
725,499,045
10,085
799,590,315
Number of units
Percentage
of total (%)
197,343,082
144,414,048
75,020,333
32,862,905
31,346,877
28,377,402
22,268,627
16,566,486
15,826,336
14,890,525
10,307,088
6,677,169
6,331,270
6,302,970
6,192,811
4,822,493
4,344,364
4,000,000
3,700,000
3,466,036
24.68
18.06
9.38
4.11
3.92
3.55
2.79
2.07
1.98
1.86
1.29
0.84
0.79
0.79
0.77
0.60
0.54
0.50
0.46
0.43
635,060,822
79.41
LISTED: 101 MORAY STREET, SOUTH MELBOURNE VIC
170 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 171
Additional stock exchange information
Substantial holders
Substantial holders in the Group are set out below as at 18 July 2023.
Corporate directory
Top 20 unitholders
The Vanguard Group, Inc.
BlackRock Group
Number of units
Percentage of total (%)
63,340,821
43,584,931
106,925,752
7.91%
5.45%
13.36%
Voting rights
All ordinary securities carry one vote per security without restriction.
Contact us
Unitholder Inquiries
Centuria Investor Services
GPO Box 3993
Sydney NSW 2000
Mail to
Centuria Capital Limited
Level 41, Chifley Tower,
2 Chifley Square
SYDNEY NSW 2000
T. 1800 182 257
Centuria Head Office
Level 41, Chifley Tower,
2 Chifley Square
SYDNEY NSW 2000
T. (02) 8923 8923
F. (02) 9460 2960
contactus@centuria.com.au
Group Chief Risk
Officer and Company
Secretary
Anna Kovarik
Level 41, Chifley Tower,
2 Chifley Square
SYDNEY NSW 2000
T. (02) 8923 8923
F. (02) 9460 2960
Disclaimer
This annual report is provided for general information purposes only. It is not a prospectus, product disclosure statement, pathfinder
document or any other disclosure document for the purposes of the Corporations Act and has not been, and is not required to be,
lodged with the Australian Securities and Investments Commission. It should not be relied upon by the recipient in considering the
merits of CNI or the acquisition of securities in CNI. Nothing in this annual report constitutes investment, legal, tax, accounting or
other advice and it is not to be relied upon in substitution for the recipient’s own exercise of independent judgment with regard to
the operations, financial condition and prospects of CNI.
The information contained in this annual report does not constitute financial product advice. Before making an investment decision,
the recipient should consider its own financial situation, objectives and needs, and conduct its own independent investigation and
assessment of the contents of this annual report, including obtaining investment, legal, tax, accounting and such other advice as it
considers necessary or appropriate.
This annual report has been prepared without taking account of any person’s individual investment objectives, financial situation or
particular needs. It is not an invitation or offer to buy or sell, or a solicitation to invest in or refrain from investing in, securities in CNI
or any other investment product. The information in this annual report has been obtained from and based on sources believed by CNI
to be reliable. To the maximum extent permitted by law, CNI and the members of the Centuria Capital Group make no representation
or warranty, express or implied, as to the accuracy, completeness, timeliness or reliability of the contents of this annual report. To the
maximum extent permitted by law, CNI does not accept any liability (including, without limitation, any liability arising
from fault or negligence) for any loss whatsoever arising from the use of this annual report or its contents or otherwise arising
in connection with it. This annual report may contain forward-looking statements, guidance, forecasts, estimates, prospects,
projections or statements in relation to future matters (Forward Statements). Forward Statements can generally be identified by
the use of forward looking words such as “anticipate”, “estimates”, “will”, “should”, “could”, “may”, “expects”, “plans”, “forecast”,
“target” or similar expressions. Forward Statements including indications, guidance or outlook on future revenues, distributions or
financial position and performance or return or growth in underlying investments are provided as a general guide only and should not
be relied upon as an indication or guarantee of future performance. No independent third party has reviewed the reasonableness of
any such statements or assumptions.
Neither CNI nor any member of Centuria Capital Group represents or warrants that such Forward Statements will be achieved or
will prove to be correct or gives any warranty, express or implied, as to the accuracy, completeness, likelihood of achievement or
reasonableness of any Forward Statement contained in this annual report. Except as required by law or regulation, CNI assumes no
obligation to release updates or revisions to Forward Statements to reflect any changes. The reader should note that this annual
report may also contain pro-forma financial information. Distributable earnings is a financial measure which is not prescribed by
Australian Accounting Standards (AAS) and represents the profit under AAS adjusted for specific non-cash and significant items. The
Directors of CFML consider that distributable earnings reflect the core earnings of the Centuria Capital Fund. All dollar values are in
Australian dollars ($ or A$) unless stated otherwise.
172 | Centuria Capital Group – Annual Report 2023
Centuria Capital Group – Annual Report 2023 | 173
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