ANNUAL REPORT
31 DECEMBER 2021
DELTA DRONE INTERNATIONAL LIMITED | ABN 17 618 678 701
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DLT IS A LEADING
GLOBAL MINING &
AGRICULTURE
TECH-SERVICES
COMPANY.
We enable clients to detect, define &
calculate asset value by digitising their
operational sites daily, with precision
and at speed
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
HIGHLIGHTS
FY2021 – as at 28 Feb 2022 (unaudited)
ASX: DLT
REVENUE
INCREASED
36%
From pcp to $4.6m ($3.4m FY20)
AUSTRALIAN
OPERATIONS
12%
Contribution to the Group’s overall revenues
NEW ENTERPRISE
CUSTOMERS
12
Increased from 2020
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
OUR ADVANTAGE
What makes our business model so unique
ASX: DLT
Market-leading
Technologies
We research & deploy sophisticated
sensors that are best in their class,
enabling faster workflows & data capture
Long-Range Flight
Capabilities
We operate semi & fully autonomous
equipment beyond visual line of site
(BVLOS) to enable larger area acquisition
Scalable Business Model
We deploy specialist drone pilots & semi-
autonomous drones within a short time
period of receiving customer orders,
allowing flexibility of capital structures
High- Frequency
High Speed Data
We provide higher resolution data at a
higher frequency (vs. manned aircraft &
satellite solutions) within 24 hours of capture
Proven Safety &
Quality Systems
Our systems are world-class in meeting
enterprise customer demand & regulator
support for complex drone operations
Economies of Scale
We provide a more cost-effective offering
through strong negotiating power with
suppliers and with the support of our own
internal maintenance & repair facilities
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ASX: DLT
“The future is about long-range,
high frequency super-fast drone
data that is delivered daily on site
enabling autonomous operations
for our customers
CHRISTOPHER CLARK CEO
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 TABLE OF
CONTENTS
INTRODUCTION
Chairman’s Letter
CEO’s Letter
Corporate Directory
Directors’ Report
Information on Directors
FINANCIAL STATEMENTS
Consolidated statement of profit or loss
and other comprehensive income
Consolidated statement of
financial position
Consolidated statement of
changes in equity
Consolidated statement of cash flows
Notes to the consolidated
financial statements
Directors’ declaration
Independent auditor’s report to the
members of Delta Drone International
Limited
ASX Additional Information
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
CHAIRMAN’S LETTER
Dear Shareholders
On behalf of the Board, it is with pleasure I present Delta Drone
International’s annual report for the financial year ended 31
December 2021 (FY21).
Delta Drone International’s first year as a listed company has seen
us build a market-leading drone service business by extensively
expanding the markets we operate in, our suite of services and
number and calibre of enterprise contracts.
At the beginning of 2021, two international business were merged to
form Delta Drone International, and with our majority acquisition of
Arvista in Australia, we have formalised the foundations of our future
market focus.
This refreshed focus on the Australian market along with thriving
African operations has contributed to a strong financial performance
in FY21, driven by our strong customer relationships, our expanded
global footprint, and growing our range of services. Post-balance
date we also sold the ParaZero business to narrow our focus on
drone services, which will position Delta Drone International for
accelerated growth in the years to come.
Delta Drone International operates as a subsidiary under the Delta
Drone Group (DDG) (EPA: ALDR), with DDG owning 55.22% of DLT’s
shares as of February 2022. Post reporting period, leading provider
of integrated drone solutions Volatus Aerospace made a strategic
investment in the Delta Drone Group which will provide significant
opportunities for Delta Drone International to further grow its
business through sharing of expertise and use of
complementary services.
The FY21 achievements would not have been possible without the
dedication and tremendous contribution of our staff, led ably by CEO
Chris Clark. I would therefore like to thank our team for their ongoing
commitment and outstanding effort throughout the year.
On behalf of the Board, we thank our shareholders for their support
throughout 2021. As the world embarks on a new journey towards
autonomous drone operations, we see an abundance of opportunities for
Delta Drone International, not only in Australia, but into new markets and
geographies with our leading drone service capabilities.
With the overall global drone market expected to grow at a compound
annual growth rate of 13.8% over 2020–2025 to reach US$42.8 billion,
I look forward to updating you on the role Delta Drone International plays
in revolutionising the way mining and agriculture companies conduct
complex aerial data capture and embrace drone technology across other
aspects of their sector, and in turn, deliver strong results
for our shareholders.
Eden Attias
Executive Chairman
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
CEO’S LETTER
I am pleased to report that throughout the FY21 year we have made
significant progress to ensure Delta Drone International remains one
of the world’s leading drones-as-a-service providers, by delivering
on key strategic initiatives, particularly with respect to new markets
and services.
Delta Drone International entered new markets throughout FY21,
bringing our global footprint to nine countries, as well as adding
another 12 major contracts with multinational enterprise companies.
These achievements, along with others outlined in this report, played
a key role in Delta Drone International being recognised as a top
four global drone services provider in the Drone Industry Insights
(Droneii) Top Drone Service Providers for 2021 Report.
The Company’s overall revenue grew significantly, up 64% to $5.5
million for the year, attributed to expanding the markets we operate
in, an expanded suite of services, and growing the number and
calibre of enterprise contracts. Our already extensive range of
services was bolstered by the latest capability in light detection and
ranging [LiDAR], security monitoring and advanced Beyond Visual
Line-of-Site (BVLOS) operations, allowing us to meet the increasingly
specialist needs of our customers.
Our customer base continues to grow, with Delta Drone International
signing contracts with some of the world’s leading enterprise mining
and agriculture companies, including, South32 Coal Holdings (now
Seriti Power), Pioneer Seed RSA, GoviEx Uranium, AMS African
Mining Services, and Rustenberg Platinum Mines, to name a few.
Perhaps the most significant milestone for our Company throughout
2021, was establishing an Australian-based headquarters and
acquiring Perth-based provider of aerial and terrestrial surveying
services, Arvista. Australia was identified as a key expansion area
due to its vast mining and agriculture sectors and fragmented
drone services industry, with the acquisition of Arvista providing the
Company with a blue-chip Australian customer base.
Post financial year end, we sold our drone safety business, ParaZero
Technologies, for A$6 million to allow the Company to focus on
becoming the leading drone service provider globally.
The sale of ParaZero provides DLT with a strengthened balance sheet and
a substantially reduced need for cash to fund the ongoing R&D investment
that had been required by the ParaZero business, allowing us to focus on
aggressively growing our global drone services business.
While 2021 was a year of positive flux, with the merger, establishing
Australian operations, purchasing Arvista, the sale of ParaZero, we have a
plan to profitability.
Looking ahead, I am excited by scaling our drone services offering and
looking for other attractive growth opportunities. Commercial applications
for drone services are steadily rising and will probably overtake
government and defense in terms of market share in the next few years.
Delta Drone International is therefore focused on profitably growing its
business, with ongoing investment in sales and marketing to harness the
reputation of our technology and operations leadership as we execute our
growth strategy throughout 2022 and beyond.
Lastly, I would like to thank you, our shareholders, for joining us on this
exciting journey. I am confident our strong business offering combined with
a wider social acceptance of drone technology will ensure our company
continues to grow sustainably into the future and delivers value for our
shareholders.
Christopher Clark
Chief Executive Officer
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
CORPORATE DIRECTORY
Directors
B.Gen (ret.) Eden Attias
Mr Christopher Clark
Mr Stephen Gorenstein
Mr Nicolas Clerc
Mr Christian Viguie
Mr Clive Donner
Executive Chairman
Chief Executive Officer
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Company secretary
Mr Stephen Buckley
Registered office
75 Thomas Street
Subiaco WA 6008
Email: contact@dlti.com.au
Principal place of business
75 Thomas Street
Subiaco WA 6008
Share register
Auditor
Legal Advisers (Australia)
Legal Advisers (Israel)
Legal Advisers (South Africa)
Stock exchange listing
Automic Registry Services
Level 5, 191 St Georges Terrace
Perth WA 6000
Tel: 1300 288 664 (Within Australia) | +61 2 9698 5414 (Outside Australia)
Fax: +61 8 9321 2337
Email: hello@automic.com.au
Web: www.automic.com.au
BDO Audit (WA) Pty Ltd
Level 9, Mia Yellogonga Tower 2
5 Spring Street
Perth WA 6000
Arnold Bloch Leibler
Level 21
333 Collins Street
Melbourne VIC 3000
Shibolet
Museum Tower
4 Berkowitz Street
Tel Aviv Israel 6423806
Rodl & Partner
1 Eastgate Lane
Bedfordview
South Africa 2007
Delta Drone International Limited shares are listed on the Australian Securities
Exchange (ASX code: DLT)
ASX Limited
Level 40, Central Park
152-158 St Georges Terrace
Perth WA 6005
Website
Web: www.dlti.com.au
Corporate Governance
Statement
Delta Drone’s Corporate Governance Statement can be viewed at:
https://www.dlti.com.au/resource/corporate-governance/
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
The Directors present their report, together with the financial statements, on the consolidated entity (referred to
hereafter as the ‘Group’) consisting of Delta Drone International Limited (referred to hereafter as the ‘Company’ or
‘parent entity’) and the entities it controlled at the end of, or during, the year ended 31 December 2021.
Directors
Name
Title
Appointed
Resigned
B. Gen (ret.) Eden Attias
Executive Chairman
13 June 2018
Mr Christopher Clark
Chief Executive Officer
3 December 2020
Mr Stephen Gorenstein
Non-Executive Director
17 October 2018
Mr Nicolas Clerc
Non-Executive Director
8 April 2021
Mr Christian Viguie
Non-Executive Director
8 April 2021
Mr Clive Donner
Non-Executive Director
14 July 2021
-
-
-
-
-
-
Mr Chris Singleton
Non-Executive Director
1 January 2019
14 July 2021
Mr Dan Arazi
Non-Executive Director
13 June 2018
21 June 2021
Principal activities
Delta Drone is a multi-national drone-based data
service and technology solutions provider for the
mining, agricultural and engineering industries.
It provides aerial surveying and mapping, security
and surveillance and blast monitoring and fragment
analysis through a fully-outsourced service and
fast data turnaround that allows enterprise
customers to focus on their operations while
DLT takes care of everything in the air, including
compliance and maintenance.
During the year, Delta Drone had in-house enabling
proprietary technology, an R&D and integration centre
and specialist expertise in designing, developing and
provided best-in-class autonomous safety systems for
commercial drone deliveries, drone flights for crowd
monitoring in urban areas as well as ‘beyond visual
line of sight’ (BVLOS) missions.
While the COVID-19 pandemic did have an impact on
the business, the overall business remained resilient
due to long-term annuity contracts with mining
customers, considered essential to
national economies.
Dividends
There were no dividends paid, recommended or
declared during the current or previous financial year.
Review of operations
The loss for the Group including non controlling
interests, after providing for income tax amounted to
$3,590,483 (31 December 2020: $115,391).
The loss for the Group from continuing operations
amounted to $1,705,749 (31 December 2020: $61,003).
Unless otherwise stated, all figures in this report are in
the Company’s presentation currency, the Australian
Dollar (“$”).
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Likely developments and expected
results of operations
The Group continues to be a drone-based data
service and technology solutions provider for the
mining, agricultural and engineering industries.
It provides aerial surveying and mapping, security
and surveillance and blast monitoring and fragment
analysis through a fully-outsourced service and fast
data turnaround that allows enterprise customers to
focus on their operations on the ground while Delta
Drone takes care of everything in the air, including
compliance and maintenance.
Board changes
During the year Mr Chris Singleton and Mr Dan Arazi
resigned as non-executive directors effective 14 July
2021 and 21 June 2021 respectively, while Mr Nicolas
Clerc, Mr Christian Viguie and Mr Clive Donner were
appointed as non-executive directors effective 8 April
2021, 8 April 2021 and 14 July 2021 respectively.
There were no other significant changes in the state
of affairs of the Group during the financial year.
Environmental regulation
The Group is not subject to any significant
environmental regulation under Australian
Commonwealth or State law.
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
Significant changes in the state of affairs
Acquisition of 60% ownership of Arvista Pty Ltd
On 1 September 2021 the Group completed the
acquisition of 60% of the shares in Perth-based
provider of aerial and terrestrial surveying services,
Arvista Pty Ltd (Arvista). The merger is a key milestone
in DLT’s expansion strategy and has immediately
provided the Group with a blue-chip Australian
client base and access to a team of highly skilled
professionals with the expertise to expand their
skillset beyond surveying to include the full range
of drone-as-a-service operations Delta Drone
International provides.
Matters subsequent to the end of the
financial year
On 28 January 2022 the Group announced that
it had entered into a binding agreement with a
consortium of investors led by NASDAQ-listed
Medigus Ltd and facilitated by Israeli venture
capital firm L.I.A Pure Capital Ltd to sell ParaZero
Technologies Ltd (“ParaZero”) which operated
the Company’s drone safety business, for a total
consideration of A$6 million in cash. This transaction
allows the Group to focus on becoming one of the
leading drone service providers globally after its
successful acquisition of the Delta Drone South Africa
business in December 2020 and the purchase of
Arvista Pty Ltd in Australia in September 2021. Post-
sale this will leave the Company with a strengthened
balance sheet and a substantially reduced need for
cash to fund the ongoing R&D investment that had
been required by the ParaZero business, allowing
the Group to focus on aggressively growing its
global drone services business. As such, the assets
(including goodwill and intangible assets), liabilities
and net profit of the Parazero operations have been
classified as assets held for sale and liabilities directly
attributed to discontinued operations in the
31 December 2021 report.
No other matter or circumstance has arisen since
31 December 2021 that has significantly affected, or
may significantly affect the Group’s operations, the
results of those operations, or the Group’s state of
affairs in future financial years.
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INFORMATION ON DIRECTORS
DIRECTORS’ REPORT
B. GEN (RET.) EDEN ATTIAS
Executive Chairman
MR CHRISTOPHER CLARK
Chief Executive Officer
Qualifications
Bachelor of Arts in Computer Science, Master of Arts
in Public Administration
Qualifications
Bachelor of Accounting, Master of Business
Administration
Experience and expertise
Brigadier General (ret.) Attias was nominated as
Israel’s first Ministry of Defense attach to Ottawa,
Canada. He has a distinguished military resume,
having served in Israeli’s Air Force as a pilot and as
a leader in numerous positions for over 30 years,
achieving the rank of Brigadier General.
Eden was previously CEO and Chairman of
ParaZero Limited and has immense experience in
the development of the Drone services business.
Following the acquisition of Delta Drone South Africa
in December 2020, Eden stepped down as CEO
but he has continued as Executive Chairman of the
Company to provide his experience and guidance
gained within the global drone services market.
Other current directorships
None
Former directorships (last 3 years)
None
Interests in shares
559,717 Ordinary Shares
Interests in options
37,106 unlisted options expiring 24 June 2024
exercisable at $0.1125 5,598,837 Options expiring
13 June 2023 exercisable at $0.0027
Interests in rights
6,000,000 performance rights (Terms as noted in note
38 of this Annual report)
Experience and expertise
Mr Clark has been involved in the mining services
sector for over 11 years in South Africa, beginning with
technology and communication projects for mining
giant Anglo American. Mr Clark has spearheaded the
development of the DDSA business across Africa,
including Ghana and Namibia, and has set up new
business verticals in agriculture and executive training.
Chris was appointed as CEO of the Company
following the acquisition of Delta Drone South Africa
in December 2020.
Other current directorships
None
Former directorships (last 3 years)
None
Interests in shares
None
Interests in options
None
Interests in rights
6,000,000 performance rights (Terms as noted in note
38 of this Annual report)
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
INFORMATION ON DIRECTORS
MR STEPHEN GORENSTEIN
Non-Executive Director
MR NICOLAS CLERC
Non-Executive Director
Qualifications
BSc (Hons) Geology and Geophysics, Masters in
Accounting and Finance
Experience and expertise
Mr Gorenstein has over 17 years’ experience in
the capital markets including analyst roles at both
Goldman Sachs and Merrill Lynch. He was formerly
the Regional Head of Asia Pacific Metals and Mining
at Bank of America Merrill Lynch. Mr Gorenstein has
extensive networks in the Australian capital markets
and is active in cross border transactions particularly
sourcing high-quality technology companies from
Israel looking to establish themselves in Australia.
Other current directorships
None
Qualifications
Advanced Degree in Accounting and Management
Experience and expertise
Mr Clerc boasts 20 years of experience within
accounting and audit firms. After working within
several national and international firms, he became
audit manager within a firm of about 60 people in
the Auvergne-Rh ne-Alpes region. He joined the
Delta Drone group in September 2017 as Group
Administrative and Finance Director.
Other current directorships
None
Former directorships (last 3 years)
None
Former directorships (last 3 years)
White Rock Minerals Limited (ceased 1 February 2021)
Interests in shares
None
Interests in shares
400,000 Ordinary Shares
Interests in options
37,106 unlisted options expiring 24 June 2024
exercisable at $0.1125
Interests in rights
Interests in rights: 1,000,000 performance rights
(Terms as noted in note 38 of this Annual report)
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INFORMATION ON DIRECTORS
DIRECTORS’ REPORT
MR CLIVE DONNER
Non-Executive Director
Qualifications
Bachelor of Commerce
MR CHRISTIAN VIGUIE
Non-Executive Director
Qualifications
Graduate of IEP Paris
Experience and expertise
Mr Viguie worked as a financial analyst before forming
multiple financial reporting companies. He also served
as CEO of the Unilog Group from 1998 to 2006,
where he was responsible for relationships with the
financial community. A member of the French Society
of Financial Analysts, Christian VIGUIÉ serves as a
professor at the Financial Analysis
Training Center.
Other current directorships
None
Former directorships (last 3 years)
None
Interests in shares
None
Experience and expertise
Mr Donner is the founding Managing Director of
the LinQ Group, a boutique investment bank he
founded in 2004 with specialist skills in mining and
resources, technology and the property development
sectors. Mr Donner has substantial private equity
and debt skills having served as a former director
of NM Rothschild and Sons (Australia) Limited,
one of the world’s preeminent project finance and
advisory banking institutions and a senior executive
of Citibank Group for the nine years prior to that. He
founded and managed several mining private equity
funds and property funds. Mr Donner has over 40
years’ commercial experience in both Australia and
internationally in both debt and equity including:
private equity, funds management, corporate and
project financing, capital raising, investment advising
and evaluation of companies across several sectors.
Other current directorships
None
Former directorships (last 3 years)
None
Interests in shares
None
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
MR DAN ARAZI
Non-Executive Director
Qualifications
Bachelor of Economics and History
Other current directorships
None
Former directorships (last 3 years)
None
Experience and expertise
Mr Arazi is a serial entrepreneur and has been
involved in a number of start-ups in Israel, most
particularly in the telecom and internet space. He
was a leading film producer in Israel and has been
a member of the Board of Israeli Film Council. He
is currently the Chairman of the Israel AeroClub
Gliding Association and the President of the Keiretsu
Forum, the Israeli Chapter of the 100+ Angels Club.
Mr Arazi is also a cofounder and executive at Orckit
Communications (NASDAQ: ORCT).
MR CHRIS SINGLETON
Non-Executive Director
Qualifications
B.Ed. Industrial Arts
Experience and expertise
Mr Singleton has extensive international experience
in Oil & Gas, Manufacturing, Technology,
Telecommunications and Service Industries.
He is currently the a provider of corporate advisory
and growth strategies to Australian businesses.
Mr Singleton has held numerous directorship
roles with public and private companies and has
successfully founded and sold business including:
Votel, a service provider acquired by Vodafone,
B Digital, that was funded by Australian Capital Equity
and eventually acquired by Soul Pattinson; Managing
Director of Impress Energy, acquired by Beach
Petroleum and recruitment solutions, Total Staffing
Solutions and UltimateSkills, that were both acquired
by Humanis Group.
MR STEPHEN BUCKLEY
Company secretary
Qualifications
GAICD
Interests in shares
359,800 Ordinary shares (as at the date of ceasing to
be a director)
Interests in options:
25,956 unlisted options expiring 24 June 2024
exercisable at $0.1125 (as at the date
of ceasing to be a director)
Other current directorships
None
Former directorships (last 3 years)
Cycliq Group Limited (ceased 7 May 2019)
Interests in shares
200,000 Ordinary Shares (as at the date of ceasing to
be a director)
Interests in options:
18,553 unlisted options expiring 24 June 2024
exercisable at $0.1125 (as at the date
of ceasing to be a director)
Experience and expertise
Mr Buckley has over 40 years’ experience in financial
markets and is a director of Governance Corporate
Pty Ltd, a company specialising in providing company
secretarial, corporate governance and corporate
advisory services. In the 20 years prior to starting his
own business, Mr Buckley has held executive and
senior leadership roles in partnership management
and business development.
‘Other current directorships’ quoted above are current directorships for listed entities only and excludes directorships of all other
types of entities, unless otherwise stated.
‘Former directorships (last 3 years)’ quoted above are directorships held in the last 3 years for listed entities only and excludes
directorships of all other types of entities, unless otherwise stated.
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
Meetings of Directors
The number of meetings of the Company’s Board of Directors (‘the Board’) held during the year ended
31 December 2021, and the number of meetings attended by each Director were:
Full Board
Attended
Held
Eden Attias
Christopher Clark
Stephen Gorenstein
Clive Donner
Nicolas Clerc
Christian Viguie
Dan Arazi
Chris Singleton
9
9
9
3
6
5
5
6
9
9
9
3
6
6
5
6
Held: represents the number of meetings held during the time the Director held office.
Remuneration report (audited)
This remuneration report for the year ended
31 December 2021 outlines the remuneration
arrangements of the Group in accordance with the
requirements of the Corporations Act 2001 (Cth), as
amended (Act) and its regulations. This information
has been audited as required by section 308(3C) of
the Act.
Key management personnel are those persons having
authority and responsibility for planning, directing
and controlling the activities of the entity, directly or
indirectly, including all Directors.
Introduction
Key Management Personnel (KMP) have authority and
responsibility for planning, directing and controlling
the major activities of the Group. KMP comprise
the directors of the Company and identified key
management personnel. Compensation levels for
KMP are competitively set to attract and retain
appropriately qualified and experienced directors and
executives. The Board may seek independent advice
on the appropriateness of compensation packages,
given trends in comparable companies both locally
and internationally and the objectives of the Group’s
compensation strategy.
The Key Management Personnel of Delta Drone
includes the current and former directors of the
Company and Key Management Personnel of Delta
Drone during the year ended 31 December 2021.
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
Remuneration governance
The Board considers that the Company will not
currently benefit from the establishment of a
Remuneration Committee. In accordance with the
Company’s Board Charter, the Board carries out the
duties that would ordinarily be carried out by the
Remuneration Committee under the Remuneration
Committee Charter, including the following processes
to set the level and composition of remuneration for
Directors and senior executives and ensuring that
such remuneration is appropriate and not excessive:
a) the Board devotes time at appropriate Board
meetings to assess the level and composition of
remuneration for Directors and senior executives;
b) items that are usually required to be discussed
by a remuneration committee are marked as
separate agenda items at Board meetings when
required; and
c) the Board may seek external advice and
benchmarking to inform their decisions.
During the financial year ended 31 December 2021,
the Company did not engage any remuneration
consultants.
Executive remuneration arrangements
The compensation structures are designed to attract suitably qualified candidates, reward the achievement of
strategic objectives, and achieve the broader outcome of creation of value for shareholders. Compensation
packages may include a mix of fixed compensation, equity-based compensation, as well as employer
contributions to superannuation funds. Shares and options may only be issued subject to approval by
shareholders in a general meeting.
At the date of this report the Company has two (2) appointed executives, Mr Eden Attias as Executive Chairman
and Christopher Clark as Chief Executive Officer. The terms of their Executive Services Agreement with Delta
Drone are summarised below:
EDEN ATTIAS
CHRISTOPHER CLARK
• Executive salary of $185,000.
• Reimbursement of reasonable business expenses
incurred in the ordinary course of the business
in accordance with the Group’s reimbursement
policies.
• The Agreement is terminable by either party on 90
days’ notice but may be terminated immediately
where either party commits a material breach of
the Agreement, including for not performing the
services under the Agreement.
• A total remuneration package of $195,000 per
annum including statutory superannuation
• Participation in the Company’s incentive programs.
• Reimbursement of reasonable business expenses
incurred in the ordinary course of the business
in accordance with the Group’s reimbursement
policies.
• The Agreement may be terminated by either party
giving four (4) months’ notice and the Agreement
may be terminated immediately if Mr Clark is
engaged in conduct justifying summary dismissal.
• Non-compete and non-solicitation restraints in
place for up to six months following cessation of
employment.
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DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
Performance Conditions Linked to
Remuneration
The Group maintains an Employee Incentive Plan
(“Plan”) to provide ongoing incentives to Eligible
Participants of the Company. The Plan was approved
by shareholders at the Company’s annual general
meeting held on 24 June 2021. Eligible Participants
include:
• a Director (whether executive or non-executive) of
any Group company;
• a full or part time employee of any Group company;
• a casual employee or contractor of a Group
Company; or
• a prospective participant, being a person to whom
the Offer was made but who can only accept the
Offer if arrangement has been entered into that
will resulting in the person becoming an Eligible
Participant.
The purpose of the Plan is to provide an incentive to
the employees and directors of Delta Drone and its
subsidiaries to encourage the sense of proprietorship
and to stimulate their active interest in the
development and financial success of the Company
by providing them with opportunities to purchase
shares in the Company.
Both Mr Attias and Mr Clark were issued with
6,000,000 Performance Rights during the 2021
financial year under the Plan, subject to various
milestones which are detailed in note 38 of this
annual report.
No other Shares or Options were issued to executives
under the Plan during the 2021 financial year
(2020: nil).
Non-executive director fee arrangements
The Board policy is to remunerate non-executive
directors at a level to comparable companies
for time, commitment, and responsibilities. Non-
executive directors may receive performance related
compensation. Directors’ fees cover all main Board
activities and membership of any committee. The
Board has no established retirement or redundancy
schemes in relation to non-executive directors.
The maximum aggregate amount of fees that can be
paid to non-executive directors is presently limited to
an aggregate of $300,000 per annum and any change
is subject to approval by shareholders at a General
Meeting. To align directors’ interests with shareholder
interests, directors are encouraged to hold shares in
the Company.
Total fees for non-executive directors for the financial
year were $99,144 (2020: $120,000) and cover main
Board activities only. Non-executive directors may
receive additional remuneration for other services
provided to the Group. All non-executive directors
enter into a service agreement with the Company
in the form of a letter of appointment. The letter
summarises the board policies and terms, including
remuneration, relevant to the office of director.
During the 2021 financial year, Mr Gorenstein was
issued with 1,000,000 Performance Rights under the
Plan, subject to various milestones which are detailed
in note 38 of this annual report.
Details of remuneration
The Key Management Personnel of Delta Drone
includes the current and former directors of the
Company and Key Management Personnel of Delta
Drone during the year ended 31 December 2021.
Amounts of remuneration
Details of the remuneration of key management
personnel of the Group are set out in the following
tables.
19
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
2021
Short-term benefits
Postemployment
benefits
Long-term
benefits
Sharebased
payments(i)
$
Cash salary
and fees
Cash
bonus
Non-
monetary
Superannuation
Long service
leave
Equity-
settled
Non-Executive Directors:
Stephen Gorenstein
40,000
Clive Donner(ii)
18,639
Nicholas Clerc(iii)
Christian Viguie(iv)
Dan Arazi(v)
Chris Singleton(vi)
Executive Directors:
Eden Attias
Christopher Clark(vii)
-
-
19,000
21,505
200,446
165,991
465,581
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
16,821
16,821
14,638
14,638
-
-
-
-
-
-
-
-
Total
44,138
18,639
-
-
19,000
21,505
4,138
-
-
-
-
-
24,828
225,274
24,828
222,278
53,794
550,834
(i) Share-based payment expense is recorded pro-rata over the vesting period. Refer to Additional disclosures relating to equity instruments for further
information on share-based payments granted to directors and key management during the year.
(ii) Appointed as non-executive director effective 14 July 2021.
(iii) Appointed as non-executive director effective 8 April 2021. No remuneration was paid during the year.
(iv) Appointed as non-executive director effective 8 April 2021. No remuneration was paid during the year.
(v) Resigned as non-executive director effective 21 June 2021.
(vi) Resigned as non-executive director effective 14 July 2021.
(vii) The remuneration for 31 December 2021 includes remuneration paid to Christopher Clark while employed in Delta Drone South Africa (Pty) Ltd.
Other remuneration includes pension, medical and life insurances and other statutory employment benefits.
2020
Short-term benefits
Postemployment
benefits
Long-term
benefits
Sharebased
payments(i)
$
Cash salary
and fees
Cash
bonus
Non-
monetary
Superannuation
Long service
leave
Equity-
settled
Non-Executive Directors:
Dan Arazi(i)
Stephen Gorenstein
Chris Singleton(ii)
Executive Directors:
Eden Attias
Christopher Clark(iii)
40,000
40,000
40,000
192,021
82,538
394,559
-
-
-
-
-
-
-
-
-
-
-
-
-
37,526
37,526
770
770
-
-
-
-
-
-
-
-
-
-
-
Total
40,000
40,000
40,000
192,021
120,834
432,855
(i) Resigned as non-executive director effective 21 June 2021.
(ii) Resigned as non-executive director effective 14 July 2021.
(iii) Appointed 3 December 2020. The remuneration for 31 December 2020 represents remuneration paid to Christopher Clark for the financial year
2020 whilst a director of Delta Drone South Africa (Pty) Ltd. Short term non-cash benefits includes medical and life insurances and other statutory
employment benefits.
20
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Fixed remuneration
At risk - STI
At risk - LTI
Name
2021
2020
2021
2020
2021
2020
Non-Executive Directors:
Stephen Gorenstein
Clive Donner
Nicholas Clerc
Christian Viguie
Dan Arazi
Chris Singleton
Executive Directors:
Eden Attias
Christopher Clark
91%
100%
100%
100%
100%
100%
89%
89%
100%
100%
100%
100%
100%
100%
100%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
9%
-
-
-
-
-
11%
11%
-
-
-
-
-
-
-
-
Share-based compensation
Issue of shares
There were no shares issued to Directors and other
key management personnel as part of compensation
during the year ended 31 December 2021.
Options
There were no options over ordinary shares issued
to Directors and other key management personnel as
part of compensation that were outstanding as at 31
December 2021.
There were no options over ordinary shares granted
to or vested by Directors and other key management
personnel as part of compensation during the year
ended 31 December 2021.
Performance rights
There were 13,000,000 performance rights over
ordinary shares issued to Directors as part of
compensation during the year ended 31 December
2021. Shareholders of the Company approved the
issue of the Performance Rights at the Annual General
Meeting of the Company held on 24 June 2021.
During the year 1,000,000 performance rights held by
Chris Singleton were forfeited due to his resignation.
As at 31 December 2021, an expense of $53,794
based on a fair value of $0.024 per right has been
recognised as share-based payment in the statement
of profit or loss and other comprehensive income
which represents the pro-rated value from 24 June
2021 (grant date) to 31 December 2021. Total value of
the remaining 13,000,000 Performance Rights will be
expensed over management’s expected vesting
period of 3 years. No performance rights have vested
in the year ended 31 December 2021.
There were no performance rights over ordinary
shares granted to or vested by Directors and other
key management personnel as part of compensation
during the year ended 31 December 2021.
The terms and milestones for the Performance Rights
are listed in note 38 of this annual report.
21
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
Name
No. of Performance Rights
Milestones
% vested
% unvested
2,000,000
2,000,000
2,000,000
666,667
666,667
666,667
1,333,334
1,333,334
1,333,334
333,334
333,334
333,334
13,000,000
New Milestone 1
New Milestone 2
New Milestone 3
DDG Milestone 1
DDG Milestone 2
DDG Milestone 3
New Milestone 1
New Milestone 2
New Milestone 3
New Milestone 1
New Milestone 2
New Milestone 3
-
-
-
-
-
-
-
-
-
-
-
-
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
Eden Attias
Eden Attias
Eden Attias
Christopher Clark
Christopher Clark
Christopher Clark
Christopher Clark
Christopher Clark
Christopher Clark
Stephen Gorenstein
Stephen Gorenstein
Stephen Gorenstein
DDG Milestones
Milestone
Description
DDG
Milestone 1
DDSA achieving consolidated revenue (for the avoidance of doubt, only DDSA and excluding the Group) for any
full financial year (being 1 Jan to 31 Dec) during the three-year term of the Performance Rights of not less than
US$3,200,000 (based on audited accounts having been prepared by an external auditor or other suitable expert).
If DDSA enters into at least two binding contracts with Australian-based mining companies (being companies that
conduct mining, exploration or extraction services) for the provision of drone survey or mapping solutions services
DDG
to those mining companies in Australia (“Services”) and DDSA receives not less than US$1,000,000 (based on
Milestone 2
audited accounts having been prepared by an external auditor or other suitable expert) of verified revenue in
aggregate from such executed contracts received within the three-year term of the Performance Rights for its
Services.
If during the three-year term of the Performance Rights, the Company announces to the ASX that DDSA has
DDG
Milestone 3
expanded the services of its business offering (being the provision of drone survey and mapping solutions) into a
new geographic location outside of Australia, Israel, South Africa, Ghana and Namibia and achieved a revenue in
that new geographic location of not less than US$1,000,000 (based on audited accounts having been prepared by
an external auditor or other suitable expert).
Note: DDSA means Delta Drone South Africa and its subsidiaries, Drone Safety and Legal, Rocketmine South Africa and Rocketmine Ghana.
New Milestones
Milestone
Description
New
The Group achieving consolidated revenue of not less than A$10,000,000 in a single financial year (being 1 Jan to
Milestone 1
31 Dec) based on audited accounts having been prepared by an external auditor or other suitable expert.
New
The Group achieving total consolidated EBITDA of not less than A$1,000,000 in a single financial year (being 1 Jan
Milestone 2
to 31 Dec) based on audited accounts having been prepared by an external auditor or other suitable expert.
New
Milestone 3
The Company achieving a total return on equity of not less than 10% in a single financial year (being 1 Jan to 31
Dec), where return on equity is equal to net profit as a percentage of total equity based on audited accounts
having been prepared by an external auditor or other suitable expert.
22
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the Company held during the financial year by each Director and other members of key
management personnel of the Group, including their personally related parties, is set out below:
Balance at the
start of the year
Received as part
of remuneration
Additions
Disposals/
resignations/ other
Balance at the
end of the year
Ordinary shares
Eden Attias
Christopher Clark
Stephen Gorenstein
Clive Donner
Nicolas Clerc
Christian Viguie
Dan Arazi
Chris Singleton
559,717
-
400,000
-
-
-
359,800
200,000
1,519,517
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(359,800)
(200,000)
(559,800)
559,717
-
400,000
-
-
-
-
-
959,717
Option holding
The number of options over ordinary shares in the Company held during the financial year by each Director
and other members of key management personnel of the Group, including their personally related parties,
is set out below:
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
resigned/
other
Balance at
the end of
the year
Vested
Unvested
Options over ordinary shares
Eden Attias
5,635,943
Christopher Clark
-
Stephen Gorenstein
37,106
Clive Donner
Nicolas Clerc
Christian Viguie
Dan Arazi
Chris Singleton
-
-
-
25,956
18,553
5,717,558
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(25,956)
(18,553)
5,635,943
100%
-
-
37,106
100%
-
-
-
-
-
-
-
-
100%
100%
(44,509)
5,673,049
0%
-
0%
-
-
-
0%
0%
23
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
Performance rights holding
The number of performance rights over ordinary shares in the Company held during the financial year by each
Director and other members of key management personnel of the Group, including their personally related
parties, is set out below:
Balance at the
start of the year
Granted
Vested
Expired/ forfeited/
other
Balance at the
end of the year
Performance rights over
ordinary shares
Eden Attias
Christopher Clark
Stephen Gorenstein
Clive Donner
Nicolas Clerc
Christian Viguie
Dan Arazi
Chris Singleton
-
-
-
-
-
-
-
-
-
6,000,000
6,000,000
1,000,000
-
-
-
-
-
13,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6,000,000
6,000,000
1,000,000
-
-
-
-
-
13,000,000
Loans to key management personnel and their related parties
There were no loans to/from key management personnel and their related parties as at 31 December 2021
(2020: nil)
Other transactions with key management personnel and their related parties
Transactions with related parties are entered into on terms equivalent to those that prevail in arm’s length
transactions. The Group had no other transactions with members of the Group’s key management personnel
and/or their related parties during the year.
Voting of shareholders at last year’s annual general meeting
The Company received 99.47% “Yes” votes cast on its Remuneration Report for the 2020 financial year.
The Company did not receive any specific feedback at the Annual General Meeting regarding its
remuneration policies.
This concludes the remuneration report, which has been audited.
24
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
Shares under option
Unissued ordinary shares of Delta Drone International Limited under option at the date of this report are
as follows:
Grant date
13 June 2018
17 April 2019
Expiry date
13 June 2023
17 April 2024
24 June 2019
24 June 2024
5 November 2019
5 November 2024
Exercise price
Number under option
$0.0027
$0.1125
$0.1125
$0.09
7,590,418
955,480
953,544
948,053
10,447,495
No person entitled to exercise the options had or has any right by virtue of the option to participate in any share
issue of the Company or of any other body corporate.
No options were issued in the year.
Shares issued on the exercise of options
The following ordinary shares of Delta Drone International Limited were issued during the year ended
31 December 2021 and up to the date of this report on the exercise of options granted:
Date options granted
13 June 2018
Exercise price
$0.0027
Number of shares issued
579,201
Shares under performance rights
Unissued ordinary shares of Delta Drone International Limited under performance rights at the date of this
report are as follows:
Grant date
24 June 2021
Expiry date
24 June 2024
Number under rights
13,000,000
There were 13,000,000 performance rights over ordinary shares issued to Directors as part of compensation
during the year ended 31 December 2021. Shareholders of the Company approved the issue of the Performance
Rights at the Annual General Meeting of the Company held on 24 June 2021.
During the year 1,000,000 performance rights held by Chris Singleton were forfeited due to his resignation.
As at 31 December 2021, an expense of $53,794 based on a fair value of $0.024 per right has been recognised
as share-based payment in the statement of profit or loss and other comprehensive income which represents
the pro-rated value from 24 June 2021 (grant date) to 31 December 2021. Total value of the remaining
13,000,000 Performance Rights ($312,000) will be expensed over management’s expected vesting period of
3 years. No performance rights have vested in the year ended 31 December 2021.
No person entitled to exercise the performance rights had or has any right by virtue of the performance right
to participate in any share issue of the Company or of any other body corporate.
25
Non-audit services
The Company may decide to employ the Auditor (BDO
Audit (WA) Pty Ltd) on assignments additional to their
statutory audit duties.
Details of the amounts paid or payable to the Auditor
for audit and non-audit services provided during the
year are set out below.
The Board has considered the position and
is satisfied that the provision of the non-audit
services is compatible with the general standard
of independence for auditors imposed by the
Corporations Act 2001. The directors are satisfied
that the provision of non-audit services by the Auditor,
as set out below, did not compromise the auditor
independence requirements of the Corporations Act
2001 for the following reasons:
• all non-audit services have been reviewed by the
Board to ensure they do not impact the impartiality
and objectivity of the Auditor; and
• none of the services undermine the general
principles relating to auditor independence as set
out in APES 110 Code of Ethics for Professional
Accountants, including reviewing or auditing the
Auditor’s own work, acting in a management or a
decision-making capacity for the Company, acting
as advocate for the Company or jointly sharing
economic risk and rewards.
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
Shares issued on the exercise of
performance rights
There were no ordinary shares of Delta Drone
International Limited issued on the exercise of
performance rights during the year ended 31
December 2021 and up to the date of this report.
Indemnity and insurance of officers
The Company has indemnified the Directors and
Officers of the Company for costs incurred, in their
capacity as a Director or Officer, for which they may be
held personally liable, except where there is a lack of
good faith.
During the financial year, the Company paid a
premium in respect of a contract to insure the
Directors and Officers of the Company against a
liability to the extent permitted by the Corporations
Act 2001. The contract of insurance prohibits
disclosure of the nature of the liability and the amount
of the premium.
Indemnity and insurance of auditor
The Company has not, during or since the end of the
financial year, indemnified or agreed to indemnify the
auditor of the Company or any related entity against a
liability incurred by the auditor.
During the financial year, the Company has not paid a
premium in respect of a contract to insure the auditor
of the Company or any related entity.
Proceedings on behalf of the Company
No person has applied to the Court under section
237 of the Corporations Act 2001 for leave to
bring proceedings on behalf of the Company, or to
intervene in any proceedings to which the Company
is a party for the purpose of taking responsibility
on behalf of the Company for all or part of those
proceedings.
26
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
(i) Audit services
Audit or review of the financial statements
Total remuneration for audit and other assurance services
(ii) Other services
Investigating Accountant’s Report -
BDO Corporate Finance (WA) Pty Ltd
Total remuneration for other services
Total remuneration of BDO Audit (WA) Pty Ltd
(iii) Audit services - network firms
Audit or review of the financial statements
Total remuneration of auditors
Auditor’s independence declaration
A copy of the auditor’s independence declaration as
required under section 307C of the Corporations Act
2001 is set out immediately after this Directors’ report.
Auditor
BDO Audit (WA) Pty Ltd continues in office in
accordance with section 327 of the Corporations
Act 2001.
This report is made in accordance with a resolution
of Directors, pursuant to section 298(2)(a) of the
Corporations Act 2001.
On behalf of the Directors
Christopher Clark
Chief Executive Officer
31 March 2022
Consolidated
2021
$
71,000
71,000
$
-
-
71,000
$
54,831
125,831
2020
$
58,000
58,000
$
60,600
60,600
118,600
$
60,327
178,927
27
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ REPORT
28
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
29
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
CONTENTS
FINANCIAL STATEMENTS
Consolidated statement of profit or loss and other comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Directors’ declaration
Independent auditor’s report to the members of Delta Drone International Limited
ASX Additional Information
31
33
34
35
36
75
76
80
General information
The financial statements cover Delta Drone International Limited as a Group consisting of Delta Drone
International Limited and the entities it controlled at the end of, or during, the year. The financial statements
are presented in Australian dollars, which is Delta Drone International Limited’s functional and presentation
currency.
Delta Drone International Limited is a listed public company limited by shares, incorporated and domiciled in
Australia. Its registered office and principal place of business is:
75 Thomas Street, Subiaco WA 6008
A description of the nature of the Group’s operations and its principal activities are included in the Directors’
report, which is not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of Directors, on 31 March
2022. The Directors have the power to amend and reissue the financial statements.
ASX: DLT
3030
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
Consolidated statement of profit or loss and other comprehensive income
For the year ended 31 December 2021
Revenue
Cost of sales
Gross profit
Other income
Gains from disposals of assets
Expenses
Operating expense
Depreciation expense
Amortisation of intangible assets
Operating (loss)/profit
Finance income
Finance expense
(Loss)/profit before income tax benefit/(expense) from continuing operations
Income tax benefit/(expense)
Loss after income tax benefit/(expense) from continuing operations
Loss after income tax expense from discontinued operations
Loss after income tax benefit/(expense) for the year
6
7
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Foreign currency translation
Depreciation expense
Total comprehensive income for the year
Loss for the year is attributable to:
Non-controlling interest
Owners of Delta Drone International Limited
Total comprehensive income for the year is attributable to:
Continuing operations
Discontinued operations
Non-controlling interest
Continuing operations
Discontinued operations
Owners of Delta Drone International Limited
Consolidated
Note
2021 ($)
2020 ($)
4
4,581,962
(2,153,244)
2,428,718
39,811
11,123
3,369,115
(1,398,727)
1,970,388
68,519
20,332
5
(4,114,053)
(1,874,275)
(86,995)
(33,273)
(125,154)
(37,595)
(1,754,669)
22,215
11,654
(867)
(1,743,882)
38,133
(1,705,749)
(1,884,734)
(3,590,483)
(94,728)
(94,728)
(3,685,211)
27,324
(3,617,807)
(3,590,483)
(4,705)
-
(4,705)
(1,795,771)
(1,884,735)
(3,680,506)
(3,685,211)
26,292
(23,064)
25,443
(86,446)
(61,003)
(54,388)
(115,391)
454,230
454,230
338,839
68,568
(183,959)
(115,391)
67,596
-
67,596
325,631
(54,388)
271,243
338,839
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes
31
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
Consolidated statement of profit or loss and other comprehensive income
For the year ended 31 December 2021 (continued)
Loss per share for loss from continuing operations
Basic loss per share
Diluted loss per share
Loss per share for loss from discontinued operations
Basic loss per share
Diluted loss per share
Loss per share for loss
Basic loss per share
Diluted loss per share
Cents
Cents
37
37
37
37
37
37
(0.34)
(0.34)
(0.37)
(0.37)
(0.71)
(0.71)
(0.34)
(0.34)
(0.04)
(0.04)
(0.13)
(0.13)
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes
32
32
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
Consolidated statement of financial position
As at 31 December 2021
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Deposits
Assets of disposal groups classified as held for sale
Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangibles
Deferred tax
Goodwill
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Contract liabilities
Borrowings
Lease liabilities
Deferred consideration
Bank overdraft
Liabilities directly associated with assets classified as held for sale
Total current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Deferred tax
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Equity attributable to the owners of Delta Drone International Limited
Non-controlling interest
Total equity
Consolidated
Note
2021 ($)
2020 ($)
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
954,916
1,415,957
40,178
2,411,051
6,540,901
8,951,952
741,252
121,621
5,313
97,542
1,403,438
2,369,166
11,321,118
470,718
114,850
350,000
97,638
271,483
18,895
1,323,584
1,682,604
3,006,188
105,253
56,003
-
161,256
3,167,444
8,153,674
13,207,118
(587,354)
(4,581,279)
8,038,485
115,189
4,991,134
789,758
35,531
5,816,423
7,282,631
13,099,054
397,952
177,304
38,118
50,930
580,824
1,245,128
14,344,182
408,425
-
506,839
79,194
-
31
994,489
1,746,997
2,741,486
-
122,642
13,169
135,811
2,877,297
11,466,885
12,904,061
(548,725)
(963,472)
11,391,864
75,021
8,153,674
11,466,885
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
33
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
Consolidated statement of changes in equity
As at 31 December 2021
Consolidated
Issued capital
($)
Foreign
Currency
Translation
Reserve ($)
Reserves ($)
Accumulated
losses ($)
Noncontrolling
interest ($)
Total equity ($)
Balance at 1 January 2020
1,159,854
(35,357)
(968,570)
(779,513)
7,425
(616,161)
(Loss)/profit after income
tax expense for the year
Other comprehensive
income for the year, net
of tax
Total comprehensive
income for the year
Transactions with owners
in their capacity as
owners:
Reverse acquisition
Issue of shares
Share issue costs
Balance at 31 December
2020
-
-
-
5,563,284
6,815,530
(634,607)
-
455,202
455,202
-
-
-
-
-
-
-
-
-
(183,959)
68,568
(115,391)
-
(972)
454,230
(183,959)
67,596
338,839
-
-
-
-
-
-
5,563,284
6,815,530
(634,607)
12,904,061
419,845
(968,570)
(963,472)
75,021
11,466,885
Consolidated
Issued capital
($)
Foreign
Currency
Translation
Reserve ($)
Reserves ($)
Share based
payment
reserves ($)
Accumulated
losses ($)
Non-
controlling
interest ($)
Total equity
($)
Balance at 1 January 2021
12,904,061
419,845
(968,570)
-
(963,472)
75,021
11,466,885
(Loss)/profit after income
tax expense for the year
Other comprehensive
income for the year, net
of tax
Total comprehensive
income for the year
-
-
-
-
(92,422)
(92,422)
Acquisition of Arvista
5,563,284
Issue of shares
6,815,530
Issue of performance
rights
Share issue costs
Balance at 31 December
2021
-
(5,882)
-
-
-
-
-
-
-
-
-
-
-
(3,617,807)
27,324
(3,590,483)
-
(2,306)
(94,728)
(3,617,807)
25,018
(3,685,211)
53,793
-
-
-
-
-
-
-
-
5,563,284
6,815,530
53,793
(5,882)
13,207,118
327,423
(968,570)
53,793
(4,581,279)
115,189
8,153,674
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
34
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
Consolidated statement of cash flows
For the year ended 31 December 2021
Current assets
Receipts from customers (inclusive of GST)
Payments to suppliers (inclusive of GST)
Interest received
Net cash from/(used in) continuing operating activities
Net cash from/(used in) operating activities - discontinued operations
Consolidated
Note
2021 ($)
2020 ($)
4,507,022
3,761,123
(6,216,466)
(3,483,788)
(1,709,444)
11,654
(1,697,790)
(1,163,968)
277,335
23,374
300,709
-
Net cash from/(used in) operating activities
34
(2,861,758)
300,709
Cash flows from investing activities
Payment for purchase of subsidiary, net of cash acquired
Payments for property, plant and equipment
Proceeds from disposal of property, plant and equipment
Cash acquired on acquisition of subsidiary
Payments for deposits (equipment and rental)
Net cash (used by) continuing investing activities
Net cash (used by) investing activities - discontinued operations
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Repayment of borrowings
Repayment of lease liabilities
Proceeds from loans
Net cash from/(used in) continuing financing activities
Net cash from/(used in) financing activities – discontinued operations
Net cash from/(used in) 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 movement of discontinued operations
31
11
(231,213)
(813,792)
18,364
-
(515)
(1,027,156)
(6,466)
(1,033,622)
-
(339,117)
91,376
247,104
(19,876)
(20,513)
-
(20,513)
4
-
4,395,356
(512,111)
(49,062)
454,821
(106,352)
(36,963)
(143,315)
(167,707)
(112,563)
-
4,115,086
-
4,115,086
(4,038,695)
4,395,282
4,991,134
2,477
-
784,604
3,037
(191,789)
Cash and cash equivalents at the end of the financial year
8
954,916
4,991,134
The above consolidated statement of financial position should be read in conjunction with the accompanying notes
35
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
Note 1. Significant accounting policies
The principal accounting policies adopted in the
preparation of the financial statements are set out
below. These policies have been consistently applied
to all the years presented, unless otherwise stated.
New or amended Accounting Standards
and Interpretations adopted
The Group has adopted all of the new or amended
Accounting Standards and Interpretations issued by
the Australian Accounting Standards Board (‘AASB’)
that are mandatory for the current reporting period.
Any new or amended Accounting Standards or
Interpretations that are not yet mandatory have not
been early adopted.
Basis of preparation
These general purpose financial statements have
been prepared in accordance with Australian
Accounting Standards and Interpretations issued by
the Australian Accounting Standards Board (‘AASB’)
and the Corporations Act 2001, as appropriate for
for-profit oriented entities. These financial statements
also comply with International Financial Reporting
Standards as issued by the International Accounting
Standards Board (‘IASB’).
Historical cost convention
The financial statements have been prepared under
the historical cost convention, except for, where
applicable, the revaluation of financial assets and
liabilities at fair value through profit or loss, financial
assets at fair value through other comprehensive
income, investment properties, certain classes of
property, plant and equipment and derivative
financial instruments.
Critical accounting estimates
The preparation of the financial statements requires
the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the
process of applying the Group’s accounting policies.
The areas involving a higher degree of judgement
or complexity, or areas where assumptions and
estimates are significant to the financial statements,
are disclosed in note 2.
36
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the Group only.
Supplementary information about the parent entity is disclosed in note 30.
Principles of consolidation
The consolidated financial statements incorporate the
assets and liabilities of all subsidiaries of Delta Drone
International Limited (‘Company’ or ‘parent entity’) as
at 31 December 2021 and the results of all subsidiaries
for the year then ended. Delta Drone International
Limited and its subsidiaries together are referred to
in these financial statements as the ‘Group’.
The acquisition of subsidiaries is accounted for using
the acquisition method of accounting. A change in
ownership interest, without the loss of control, is
accounted for as an equity transaction, where the
difference between the consideration transferred
and the book value of the share of the non-controlling
interest acquired is recognised directly in equity
attributable to the parent.
Subsidiaries are all those entities over which the
Group has control. The Group controls an entity when
the Group 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
to direct the activities of the entity. Subsidiaries are
fully consolidated from the date on which control is
transferred to the Group. They are de-consolidated
from the date that control ceases.
Intercompany transactions, balances and unrealised
gains on transactions between entities in the Group
are eliminated. Unrealised losses are also eliminated
unless the transaction provides evidence of the
impairment of the asset transferred. Accounting
policies of subsidiaries have been changed where
necessary to ensure consistency with the policies
adopted by the Group.
Non-controlling interest in the results and equity of
subsidiaries are shown separately in the statement
of profit or loss and other comprehensive income,
statement of financial position and statement of
changes in equity of the Group. Losses incurred
by the Group are attributed to the non-controlling
interest in full, even if that results in a deficit balance.
Where the Group loses control over a subsidiary,
it derecognises the assets including goodwill,
liabilities and non-controlling interest in the subsidiary
together with any cumulative translation differences
recognised in equity. The Group recognises the fair
value of the consideration received and the fair value
of any investment retained together with any gain or
loss in profit or loss.
37
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Operating segments
Operating segments are presented using the ‘management approach’, where the information presented is on
the same basis as the internal reports provided to the Chief Operating Decision Makers (‘CODM’). The CODM
is responsible for the allocation of resources to operating segments and assessing their performance.
Foreign currency translation
The financial statements are presented in Australian
dollars, which is Delta Drone International Limited’s
functional and presentation currency.
Foreign currency transactions
Foreign currency transactions are translated into
Australian dollars using the exchange rates prevailing
at the dates of the transactions. Foreign exchange
gains and losses resulting from the settlement of such
transactions and from the translation at financial year-
end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in
profit or loss.
Revenue recognition
The Group recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the
consideration to which the Group is expected to be
entitled in exchange for transferring goods or services
to a customer. For each contract with a customer,
the Group: identifies the contract with a customer;
identifies the performance obligations in the contract;
determines the transaction price which takes into
account estimates of variable consideration and the
time value of money; allocates the transaction price to
the separate performance obligations on the basis of
the relative stand-alone selling price of each distinct
good or service to be delivered; and recognises
revenue when or as each performance obligation is
satisfied in a manner that depicts the transfer to the
customer of the goods or services promised.
Variable consideration within the transaction price,
if any, reflects concessions provided to the customer
such as discounts, rebates and refunds, any potential
bonuses receivable from the customer and any other
contingent events. Such estimates are determined
using either the ‘expected value’ or ‘most likely
amount’ method. The measurement of variable
consideration is subject to a constraining principle
Foreign operations
The assets and liabilities of foreign operations
are translated into Australian dollars using the
exchange rates at the reporting date. The revenues
and expenses of foreign operations are translated
into Australian dollars using the average exchange
rates, which approximate the rates at the dates of
the transactions, for the period. All resulting foreign
exchange differences are recognised in other
comprehensive income through the foreign
currency reserve in equity.
whereby revenue will only be recognised to the extent
that it is highly probable that a significant reversal in
the amount of cumulative revenue recognised will not
occur. The measurement constraint continues until the
uncertainty associated with the variable consideration
is subsequently resolved. Amounts received that are
subject to the constraining principle are recognised as
a refund liability.
Rendering of services
Revenue from a contract to provide services is
recognised over time as the services are rendered
based on either a fixed price or an hourly rate.
Interest
Interest revenue is recognised as interest accrues
using the effective interest method. This is a method
of calculating the amortised cost of a financial asset
and allocating the interest income over the relevant
period using the effective interest rate, which is the
rate that exactly discounts estimated future cash
receipts through the expected life of the financial
asset to the net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or
when the right to receive payment is established.
38
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Income tax
The income tax expense or benefit for the period is
the tax payable on that period’s taxable income based
on the applicable income tax rate for each jurisdiction,
adjusted by the changes in deferred tax assets and
liabilities attributable to temporary differences, unused
tax losses and the adjustment recognised for prior
periods, where applicable.
Deferred tax assets and liabilities are recognised for
temporary differences at the tax rates expected to be
applied when the assets are recovered or liabilities
are settled, based on those tax rates that are enacted
or substantively enacted, except for:
• When the deferred income tax asset or liability
arises from the initial recognition of goodwill or
an asset or liability in a transaction that is not a
business combination and that, at the time of the
transaction, affects neither the accounting nor
taxable profits; or
• When the taxable temporary difference is
associated with interests in subsidiaries, associates
or joint ventures, and the timing of the reversal can
be controlled and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred tax assets are recognised for deductible
temporary differences and unused tax losses only
if it is probable that future taxable amounts will be
available to utilise those temporary differences
and losses.
The carrying amount of recognised and unrecognised
deferred tax assets are reviewed at each reporting
date. Deferred tax assets recognised are reduced
to the extent that it is no longer probable that future
taxable profits will be available for the carrying amount
to be recovered. Previously unrecognised deferred tax
assets are recognised to the extent that it is probable
that there are future taxable profits available to
recover the asset.
Deferred tax assets and liabilities are offset only
where there is a legally enforceable right to offset
current tax assets against current tax liabilities and
deferred tax assets against deferred tax liabilities; and
they relate to the same taxable authority on either the
same taxable entity or different taxable entities which
intend to settle simultaneously.
Discontinued operations
A discontinued operation is a component of the Group that has been disposed of or is classified as held for sale
and that represents a separate major line of business or geographical area of operations, is part of a single co-
ordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively
with a view to resale. The results of discontinued operations are presented separately on the face of the
statement of profit or loss and other comprehensive income.
Current and non-current classification
Assets and liabilities are presented in the statement
of financial position based on current and non-current
classification.
An asset is classified as current when: it is either
expected to be realised or intended to be sold or
consumed in the Group’s normal operating cycle; it is
held primarily for the purpose of trading; it is expected
to be realised within 12 months after the reporting
period; or the asset is cash or cash equivalent unless
restricted from being exchanged or used to settle
a liability for at least 12 months after the reporting
period. All other assets are classified as non-current.
A liability is classified as current when: it is either
expected to be settled in the Group’s normal
operating cycle; it is held primarily for the purpose of
trading; it is due to be settled within 12 months after
the reporting period; or there is no unconditional right
to defer the settlement of the liability for at least 12
months after the reporting period. All other liabilities
are classified as non-current.
Deferred tax assets and liabilities are always classified
as non-current.
39
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Cash and cash equivalents
Cash and cash equivalents includes cash on hand,
deposits held at call with financial institutions, other
short-term, highly liquid investments with original
maturities of three months or less that are readily
convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.
Trade and other receivables
Trade receivables are initially recognised at fair value
and subsequently measured at amortised cost using
the effective interest method, less any allowance
for expected credit losses. Trade receivables are
generally due for settlement within 30 days.
The Group has applied the simplified approach to
measuring expected credit losses, which uses a
lifetime expected loss allowance. To measure the
expected credit losses, trade receivables have been
grouped based on days overdue. Other receivables
are recognised at amortised cost, less any allowance
for expected credit losses.
Non-current assets or disposal groups
classified as held for sale
Non-current assets and assets of disposal groups are
classified as held for sale if their carrying amount will
be recovered principally through a sale transaction
rather than through continued use. They are measured
at the lower of their carrying amount and fair value less
costs of disposal. For non-current assets or assets of
disposal groups to be classified as held for sale, they
must be available for immediate sale in their present
condition and their sale must be highly probable.
An impairment loss is recognised for any initial or
subsequent write down of the non-current assets
and assets of disposal groups to fair value less costs
of disposal. A gain is recognised for any subsequent
increases in fair value less costs of disposal of a non-
current assets and assets of disposal groups, but not
in excess of any cumulative impairment loss
previously recognised.
Non-current assets are not depreciated or amortised
while they are classified as held for sale. Interest
and other expenses attributable to the liabilities of
assets held for sale continue to be recognised. Non-
current assets classified as held for sale and the
assets of disposal groups classified as held for sale
are presented separately on the face of the statement
of financial position, in current assets. The liabilities
of disposal groups classified as held for sale are
presented separately on the face of the statement
of financial position, in current liabilities.
40
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Property, plant and equipment
Plant and equipment is stated at historical cost less
accumulated depreciation and impairment. Historical
cost includes expenditure that is directly attributable
to the acquisition of the items.
Depreciation is calculated on a straight-line basis to
write off the net cost of each item of property, plant
and equipment (excluding land) over their expected
useful lives as follows:
Computer
Furniture and equipment
Leasehold improvements
Buildings
Plant and equipment
3 years
3-17 years
the shorter of the lease
term and the useful life
2-3 years
1-10 years
The residual values, useful lives and depreciation
methods are reviewed, and adjusted if appropriate,
at each reporting date.
Leasehold improvements are depreciated over the
unexpired period of the lease or the estimated useful
life of the assets, whichever is shorter.
An item of property, plant and equipment is
derecognised upon disposal or when there is no
future economic benefit to the Group. Gains and
losses between the carrying amount and the disposal
proceeds are taken to profit or loss. Any revaluation
surplus reserve relating to the item disposed of is
transferred directly to retained profits.
Right-of-use assets
A right-of-use asset is recognised at the
commencement date of a lease. The right-of-use
asset is measured at cost, which comprises the
initial amount of the lease liability, adjusted for, as
applicable, any lease payments made at or before
the commencement date net of any lease incentives
received, any initial direct costs incurred, and, except
where included in the cost of inventories, an estimate
of costs expected to be incurred for dismantling and
removing the underlying asset, and restoring the site
or asset.
Right-of-use assets are depreciated on a straight-line
basis over the unexpired period of the lease or the
estimated useful life of the asset, whichever is the
shorter. Where the Group expects to obtain ownership
of the leased asset at the end of the lease term, the
depreciation is over its estimated useful life. Right-of
use assets are subject to impairment or adjusted for
any remeasurement of lease liabilities.
The Group has elected not to recognise a right-of-use
asset and corresponding lease liability for short-term
leases with terms of 12 months or less and leases of
low-value assets. Lease payments on these assets are
expensed to profit or loss as incurred.
Impairment of non-financial assets
Non-financial 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.
Trade and other payables
These amounts represent liabilities for goods and
services provided to the Group prior to the end of
the financial year and which are unpaid. Due to their
short-term nature they are measured at amortised cost
and are not discounted. The amounts are unsecured
and are usually paid within 30 days of recognition.
Recoverable amount is the higher of an asset’s fair
value less costs of disposal and value-in-use. The
value-in-use is the present value of the estimated
future cash flows relating to the asset using a pre-tax
discount rate specific to the asset or cash-generating
unit to which the asset belongs. Assets that do not
have independent cash flows are grouped together
to form a cash-generating unit.
41
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
Contract liabilities
Contract liabilities represent the Group’s obligation
to transfer goods or services to a customer and are
recognised when a customer pays consideration, or
when the Group recognises a receivable to reflect
its unconditional right to consideration (whichever is
earlier) before the Group has transferred the goods
or services to the customer.
Borrowings
Loans and borrowings are initially recognised at
the fair value of the consideration received, net of
transaction costs. They are subsequently measured
at amortised cost using the effective interest method.
Lease liabilities
A lease liability is recognised at the commencement
date of a lease. The lease liability is initially recognised
at the present value of the lease payments to be
made over the term of the lease, discounted using
the interest rate implicit in the lease or, if that rate
cannot be readily determined, the Group’s incremental
borrowing rate. Lease payments comprise of fixed
payments less any lease incentives receivable,
variable lease payments that depend on an index or
a rate, amounts expected to be paid under residual
value guarantees, exercise price of a purchase option
when the exercise of the option is reasonably certain
to occur, and any anticipated termination penalties.
The variable lease payments that do not depend on
an index or a rate are expensed in the period in which
they are incurred.
Lease liabilities are measured at amortised cost using
the effective interest method. The carrying amounts
are remeasured if there is a change in the following:
future lease payments arising from a change in
an index or a rate used; residual guarantee; lease
term; certainty of a purchase option and termination
penalties. When a lease liability is remeasured, an
adjustment is made to the corresponding right-of use
asset, or to profit or loss if the carrying amount of the
right-of-use asset is fully written down.
42
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Finance costs
Finance costs attributable to qualifying assets are
capitalised as part of the asset. All other finance costs
are expensed in the period in which they are incurred.
Provisions
Provisions are recognised when the Group has a
present (legal or constructive) obligation as a result of
a past event, it is probable the Group will be required
to settle the obligation, and a reliable estimate can
be made of the amount of the obligation. The amount
recognised as a provision is the best estimate of the
consideration required to settle the present obligation
at the reporting date, taking into account the risks and
uncertainties surrounding the obligation. If the time
value of money is material, provisions are discounted
using a current pre-tax rate specific to the liability.
The increase in the provision resulting from the
passage of time is recognised as a finance cost.
Employee benefits
Share-based payments
Equity-settled and cash-settled share-based
compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or
options over shares, that are provided to employees in
exchange for the rendering of services. Cash-settled
transactions are awards of cash for the exchange of
services, where the amount of cash is determined by
reference to the share price.
The cost of equity-settled transactions are measured
at fair value on grant date. Fair value is independently
determined using either the Binomial or Black-Scholes
option pricing model that takes into account the
exercise price, the term of the option, the impact of
dilution, the share price at grant date and expected
price volatility of the underlying share, the expected
dividend yield and the risk free interest rate for
the term of the option, together with non-vesting
conditions that do not determine whether the Group
receives the services that entitle the employees to
receive payment. No account is taken of any other
vesting conditions.
The cost of equity-settled transactions are recognised
as an expense with a corresponding increase in equity
over the vesting period. The cumulative charge to
profit or loss is calculated based on the grant date fair
value of the award, the best estimate of the number
of awards that are likely to vest and the expired
portion of the vesting period. The amount recognised
in profit or loss for the period is the cumulative amount
calculated at each reporting date less amounts
already recognised in previous periods.
The cost of cash-settled transactions is initially, and
at each reporting date until vested, determined by
applying either the Binomial or Black-Scholes option
pricing model, taking into consideration the terms
and conditions on which the award was granted. The
cumulative charge to profit or loss until settlement of
the liability is calculated as follows:
• during the vesting period, the liability at each
reporting date is the fair value of the award at
that date multiplied by the expired portion of the
vesting period.
• from the end of the vesting period until settlement
of the award, the liability is the full fair value of the
liability at the reporting date.
All changes in the liability are recognised in profit or
loss. The ultimate cost of cash-settled transactions is
the cash paid to settle the liability.
Market conditions are taken into consideration in
determining fair value. Therefore any awards subject to
market conditions are considered to vest irrespective
of whether or not that market condition has been met,
provided all other conditions are satisfied.
If equity-settled awards are modified, as a minimum
an expense is recognised as if the modification has
not been made. An additional expense is recognised,
over the remaining vesting period, for any modification
that increases the total fair value of the share-based
compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the
Group or employee, the failure to satisfy the condition
is treated as a cancellation. If the condition is not
within the control of the Group or employee and is
not satisfied during the vesting period, any remaining
expense for the award is recognised over the
remaining vesting period, unless the award is forfeited.
43
If equity-settled awards are cancelled, it is treated
as if it has vested on the date of cancellation, and
any remaining expense is recognised immediately.
If a new replacement award is substituted for the
cancelled award, the cancelled and new award is
treated as if they were a modification.
Fair value measurement
When an asset or liability, financial or non-financial,
is measured at fair value for recognition or disclosure
purposes, the fair value is based on the price that
would be received to sell an asset or paid to transfer
a liability in an orderly transaction between market
participants at the measurement date; and assumes
that the transaction will take place either: in the
principal market; or in the absence of a principal
market, in the most advantageous market.
Fair value is measured using the assumptions that
market participants would use when pricing the
asset or liability, assuming they act in their economic
best interests. For non-financial assets, the fair
value measurement is based on its highest and best
use. Valuation techniques that are appropriate in
the circumstances and for which sufficient data are
available to measure fair value, are used, maximising
the use of relevant observable inputs and minimising
the use of unobservable inputs.
Issued capital
Ordinary shares are classified as equity. Incremental
costs directly attributable to the issue of new shares or
options are shown in equity as a deduction, net of tax,
from the proceeds.
4444
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Business combinations
The acquisition method of accounting is used to
account for business combinations regardless of
whether equity instruments or other assets are
acquired.
contingent consideration classified as an asset or
liability is recognised in profit or loss. Contingent
consideration classified as equity is not remeasured
and its subsequent settlement is accounted for
within equity.
The consideration transferred is the sum of the
acquisition-date fair values of the assets transferred,
equity instruments issued or liabilities incurred by the
acquirer to former owners of the acquiree and the
amount of any non-controlling interest in the acquiree.
For each business combination, the non-controlling
interest in the acquiree is measured at either fair
value or at the proportionate share of the acquiree’s
identifiable net assets. All acquisition costs are
expensed as incurred to profit or loss.
On the acquisition of a business, the Group assesses
the financial assets acquired and liabilities assumed
for appropriate classification and designation in
accordance with the contractual terms, economic
conditions, the Group’s operating or accounting
policies and other pertinent conditions in existence
at the acquisition-date.
Where the business combination is achieved in
stages, the Group remeasures its previously held
equity interest in the acquiree at the acquisition-date
fair value and the difference between the fair value
and the previous carrying amount is recognised in
profit or loss.
Contingent consideration to be transferred by the
acquirer is recognised at the acquisition-date fair
value. Subsequent changes in the fair value of the
The difference between the acquisition-date fair value
of assets acquired, liabilities assumed and any non-
controlling interest in the acquiree and the fair value
of the consideration transferred and the fair value
of any pre-existing investment in the acquiree
is recognised as goodwill. If the consideration
transferred and the pre-existing fair value is less
than the fair value of the identifiable net assets
acquired, being a bargain purchase to the acquirer,
the difference is recognised as a gain directly in
profit or loss by the acquirer on the acquisition-date,
but only after a reassessment of the identification
and measurement of the net assets acquired, the
non-controlling interest in the acquiree, if any, the
consideration transferred and the acquirer’s
previously held equity interest in the acquirer.
Business combinations are initially accounted for
on a provisional basis. The acquirer retrospectively
adjusts the provisional amounts recognised and also
recognises additional assets or liabilities during the
measurement period, based on new information
obtained about the facts and circumstances that
existed at the acquisition-date. The measurement
period ends on either the earlier of (i) 12 months from
the date of the acquisition or (ii) when the acquirer
receives all the information possible to determine
fair value.
45
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing
the profit attributable to the owners of Delta Drone
International Limited, excluding any costs of servicing
equity other than ordinary shares, by the weighted
average number of ordinary shares outstanding
during the financial year, adjusted for bonus elements
in ordinary shares issued during the financial year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in
the determination of basic earnings per share to take
into account the after income tax effect of interest
and other financing costs associated with dilutive
potential ordinary shares and the weighted average
number of shares assumed to have been issued
for no consideration in relation to dilutive potential
ordinary shares.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Goods and Services Tax (‘GST’) and other
similar taxes
Revenues, expenses and assets are recognised net
of the amount of associated GST, unless the GST
incurred is not recoverable from the tax authority.
In this case it is recognised as part of the cost of the
acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the
amount of GST receivable or payable. The net amount of
GST recoverable from, or payable to, the tax authority is
included in other receivables or other payables in the
statement of financial position.
Cash flows are presented on a gross basis. The GST
components of cash flows arising from investing
or financing activities which are recoverable from,
or payable to the tax authority, are presented as
operating cash flows.
Commitments and contingencies are disclosed net
of the amount of GST recoverable from, or payable to,
the tax authority.
New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not
yet mandatory, have not been early adopted by the Group for the annual reporting period ended 31 December
2021. The Group has not yet assessed the impact of these new or amended Accounting Standards and
Interpretations.
46
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 2. Critical accounting judgements,
estimates and assumptions
The preparation of the financial statements requires
management to make judgements, estimates and
assumptions that affect the reported amounts in
the financial statements. Management continually
evaluates its judgements and estimates in relation
to assets, liabilities, contingent liabilities, revenue
and expenses. Management bases its judgements,
estimates and assumptions on historical experience
and on other various factors, including expectations of
future events, management believes to be reasonable
under the circumstances. The resulting accounting
judgements and estimates will seldom equal the
related actual results. The judgements, estimates and
assumptions that have a significant risk of causing a
material adjustment to the carrying amounts of assets
and liabilities (refer to the respective notes) within the
next financial year are discussed below.
Share-based payment transactions
The Group measures the cost of equity-settled
transactions with employees by reference to the fair
value of the equity instruments at the date at which
they are granted. The fair value is determined by
using either the Binomial or Black-Scholes model
taking into account the terms and conditions upon
which the instruments were granted. The accounting
estimates and assumptions relating to equity-settled
share-based payments would have no impact on the
carrying amounts of assets and liabilities within the
next annual reporting period but may impact profit
or loss and equity.
The Group issued performance rights during the year
ended 31 December 2021 based on the conditions
set out in note 38. The Group follows the guidelines
of AASB 2 ‘Share Based Payments’ and takes into
account non-market vesting conditions and estimates
the probability and expected timing of achieving the
vesting conditions. For full terms of the securities
issued see note 38.
Allowance for expected credit losses
The allowance for expected credit losses assessment
requires a degree of estimation and judgement. It is
based on the lifetime expected credit loss, grouped
based on days overdue, and makes assumptions
to allocate an overall expected credit loss rate for
each group. These assumptions include recent sales
experience and historical collection rates.
The fair value of assets and liabilities classified as
level 3 is determined by the use of valuation models.
These include discounted cash flow analysis or the
use of observable inputs that require significant
adjustments based on unobservable inputs.
Estimation of useful lives of assets
The Group determines the estimated useful lives and
related depreciation and amortisation charges for its
property, plant and equipment and finite life intangible
assets. The useful lives could change significantly
as a result of technical innovations or some other
event. The depreciation and amortisation charge
will increase where the useful lives are less than
previously estimated lives, or technically obsolete or
non-strategic assets that have been abandoned or
sold will be written off or written down.
Goodwill and other indefinite life intangible assets
The Group tests annually, or more frequently if events
or changes in circumstances indicate impairment,
whether goodwill and other indefinite life intangible
assets have suffered any impairment. The recoverable
amounts of cash-generating units have been
determined based on value-in-use calculations.
These calculations require the use of assumptions,
including estimated discount rates based on the
current cost of capital and growth rates of the
estimated future cash flows.
Impairment of non-financial assets other than goodwill
and other indefinite life intangible assets
The Group assesses impairment of non-financial
assets other than goodwill and other indefinite life
intangible assets at each reporting date by evaluating
conditions specific to the Group and to the particular
asset that may lead to impairment.
If an impairment trigger exists, the recoverable
amount of the asset is determined. This involves
fair value less costs of disposal or value-in-use
calculations, which incorporate a number of key
estimates and assumptions.
47
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible
temporary differences only if the Group considers
it is probable that future taxable amounts will be
available to utilise those temporary differences and
losses.
Income tax
The Group is subject to income taxes in the
jurisdictions in which it operates. Significant
judgement is required in determining the provision
for income tax. There are many transactions
and calculations undertaken during the ordinary
course of business for which the ultimate tax
determination is uncertain. The Group recognises
liabilities for anticipated tax audit issues based
on the Group’s current understanding of the
tax law. Where the final tax outcome of these
matters is different from the carrying amounts,
such differences will impact the current and
deferred tax provisions in the period in which such
determination is made.
Business combinations
As discussed in note 1, business combinations
are initially accounted for on a provisional basis.
The fair value of assets acquired, liabilities and
contingent liabilities assumed are initially estimated
by the Group taking into consideration all available
information at the reporting date. Fair value
adjustments on the finalisation of the business
combination accounting is retrospective, where
applicable, to the period the combination occurred
and may have an impact on
the assets and liabilities, depreciation and
amortisation reported.
During the year, the Company acquired 60% of the
ordinary shares of Arvista Pty Ltd and accounted
for the acquisition as a business combination as
disclosed in note 31. The Shareholders Agreement
provides for a call option where the Company
has the right to purchase the remaining 40%
interest in Arvista Pty Ltd at 1.5 times the 12-month
trading revenue. The call option is not on fixed
for fixed terms and is therefore accounted for as
a derivative at fair value through profit or loss.
As the exercise price is based on fair value of
the business, the value of the option has been
determined by the directors to be nil.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
48
48
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 3. Operating segments
Identification of reportable operating segments
The Group is organised into three operating segments. These operating segments are based on the internal
reports that are reviewed and used by the Board of Directors (who are identified as the Chief Operating
Decision Makers (‘CODM’)) in assessing performance and in determining the allocation of resources. There is no
aggregation of operating segments. The segments are split into the geographical locations of the Group’s main
business, namely Australia, South Africa and Israel. The following table analyses sales revenue and EBITDA
based on geographical location
Operating segment information
Consolidated - 2021
Australia ($)
South Africa ($)
Israel ($)
Other
segments ($)
Total ($)
Revenue
Sales to external customers
553,836
4,028,126
966,354
553,836
4,028,126
966,354
-
-
5,548,316
5,548,316
Total revenue
EBITDA
(1,689,851)
114,393
(1,324,677)
(44,679)
(2,944,814)
Depreciation and amortisation
(16,891)
(103,377)
(525,148)
Interest revenue
Finance costs
164
(108)
11,654
-
(13,279)
(34,910)
-
-
-
(645,416)
11,818
(48,297)
(Loss)/profit before income tax benefit
(1,706,686)
9,391
(1,884,735)
(44,679)
(3,626,709)
Income tax benefit
Loss after income tax benefit
36,226
(3,590,483)
Consolidated - 2020
Australia ($)
South Africa ($)
Israel ($)
Other
segments ($)
Total ($)
Revenue
Sales to external customers
Total revenue
EBITDA
Depreciation and amortisation
Interest revenue
Finance costs
(Loss)/profit before income tax benefit
Income tax benefit
Loss after income tax benefit
-
-
3,369,115
3,369,115
-
-
(172,220)
357,184
(40,000)
-
-
(4,207)
(176,427)
(162,747)
(14,388)
26,291
(18,858)
201,870
-
-
(54,388)
-
-
-
-
-
-
-
3,369,115
3,369,115
144,964
(177,135)
26,291
(23,065)
(28,945)
(86,446)
(115,391)
(i) Results relating to operations in Israel have been included in this note for disclosure purposes. Results for the segment are reported on a net basis
in the consolidated statement of profit or loss and other comprehensive income as it is a discontinued operation.
49
Segment assets
Unallocated assets:
Cash
Deferred tax asset
Segment liabilities
Unallocated liabilities:
Borrowings
Note 4. Revenue
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2021
2020
10,504,861
9,302,118
954,915
4,991,134
97,542
50,930
11,557,318
14,344,182
2,948,391
2,357,290
455,253
506,838
3,403,644
2,864,128
Consolidated
2021 ($)
2020 ($)
Rendering of services
4,581,962
3,369,115
Timing of revenue recognition
At a point in time
Over time
Note 5. Operating expense
Employee benefits expense
General and administrative expenses
Corporate costs
Consolidated
2021 ($)
2020 ($)
-
-
4,581,962
3,369,115
4,581,962
3,369,115
Consolidated
2021 ($)
2020 ($)
1,474,711
822,905
1,398,698
1,240,644
879,150
172,220
4,114,053
1,874,275
50
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 6. Income tax expense/(benefit)
Numerical reconciliation of income tax expense/(benefit) and tax at the statutory rate
(Loss)/profit before income tax benefit/(expense) from continuing operations
(1,743,882)
25,443
Consolidated
2021 ($)
2020 ($)
Loss before income tax expense from discontinued operations
Tax at the statutory tax rate of 26%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Permanent difference relating to loss on disposal of discontinued operations
Permanent difference relating to non-deductible expenses
Movement in unrecognised temporary differences
Movement in temporary differences
Tax effect of current year losses for which no deferred tax asset has been recognised
Tax effect of losses utilised
Effect of different tax rate of group entities operating in different jurisdictions
Income tax expense/(benefit)
Tax losses not recognised
(1,884,734)
(54,388)
(3,628,616)
(28,945)
(943,440)
(7,526)
490,031
31,270
(422,139)
-
-
-
(7,526)
18,228
(31,593)
(88,707)
495,665
-
(2,724)
14,645
(19,045)
(4,041)
39,209
(86,446)
Consolidated
2021 ($)
2020 ($)
Unused tax losses for which no deferred tax asset has been recognised
1,906,403
4,043,881
Potential tax benefit @ 26%
495,665
1,051,409
The above potential tax benefit for tax losses has not been recognised in the statement of financial position.
These tax losses can only be utilised in the future if the continuity of ownership test is passed, or failing that, the
same business test is passed.
51
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Deferred tax assets
Capital allowances
Leases
Provisions
Carry forward foreign tax losses
Deferred tax liabilities
Prepayments
Brand name
Licenses to operate
Domain, manuals and processes
Deferred tax liabilities
US License
Technology
Customer Relationships
Unrecognised temporary differences
Deferred tax assets
Blackhole expenditure
Patent costs
Accrued expenses
Capital raising costs
Carry forward revenue tax losses
Deferred tax liability
Contract assets
Consolidated
2021 ($)
2020 ($)
5,994
8,261
7,431
76,541
98,227
803
(282)
(1,129)
(77)
(685)
2,201
6,869
4,362
37,498
50,930
(2,496)
(2,025)
(8,099)
(549)
(13,169)
(218,822)
(102,368)
(251,000)
(117,000)
(266,174)
(380,000)
(587,364)
(748,000)
Consolidated
2021 ($)
2020 ($)
-
-
67,570
-
457,956
525,526
(29,861)
(29,861)
176,781
431
27,820
275,442
570,935
1,051,409
-
-
Total unrecognised temporary differences
495,665
1,051,409
Unused tax losses for which no deferred tax asset has been recognised will be subject to the Company satisfying the
requirements imposed by regulatory taxation authorities. The benefits of deferred tax assets will only be recognised if:
• Future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;
• The conditions for deductibility imposed by tax legislation continue to be complied with; and
• No changes in tax legislation adversely affect the Company in realising the benefit.
52
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 7. Discontinued operations
Revenue
Expenses
Loss before income tax expense
Income tax expense
Loss after income tax expense from discontinued operations
Consolidated
2021 ($)
966,354
2020 ($)
-
(2,851,088)
(54,388)
(1,884,734)
(54,388)
-
-
(1,884,734)
1,051,409
In February 2022, the Group finalised the sale of Parazero Israel. In line with AASB 5 Non-current Assets Held
for Sale and Discontinued Operations the assets and liabilities of the entity has been disclosed separately in
this note and has been recognised as assets of disposal groups classified as held for sale and liabilities directly
associated with assets classified as held for sale. The performance of Parazero Israel has been included as a
single line item in the Consolidated statement of profit or loss and other comprehensive income. Refer to note
33 for further information.
Note 8. Current assets - cash and cash equivalents
Cash and cash equivalents
Consolidated
2021 ($)
954,916
2020 ($)
4,991,134
Refer to note 26 for further information on the risk exposure analysis of cash and cash equivalents.
Note 9. Current assets - trade and other receivables
Trade receivables
Expected Credit loss allowance
Goods and services tax
Prepayments
Other receivables
Consolidated
2021 ($)
1,067,644
(6,095)
92,143
1,153,692
2020 ($)
557,898
(7,946)
206,819
756,771
259,885
23,522
2,380
9,465
1,415,957
789,758
Refer to note 26 for further information on the risk exposure analysis of trade and other receivables.
There are no receivables that are past due where expected credit loss has not been assessed.
Prepayments mainly relate to payments made for insurances paid in advance.
53
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 10. Current assets - assets of disposal groups classified as held for sale
Cash and cash equivalents
Trade and other receivables
Inventories
Property, plant and equipment
Intangibles and goodwill
Deferred tax asset
Note 11. Non-current assets - property, plant and equipment
Consolidated
2021 ($)
2020 ($)
45,424
38,281
191,789
184,453
483,895
480,850
68,957
82,337
5,818,054
6,343,202
86,290
-
6,540,901
7,282,631
Consolidated
2021 ($)
2020 ($)
2,095,970
1,495,952
(1,354,718)
(1,098,000)
741,252
397,952
Cost
Accumulated depreciation
Net carrying amount
31 December 2021
Survey equipment
Furniture and fixtures
Motor vehicles
Office equipment
IT equipment
Leasehold improvements
Drone accessories
Drones
Drone batteries
Other fixed assets
Capital works in progress
Opening
balance ($)
Additions ($)
Disposals ($)
Foreign
exchange
movements ($)
Depreciation
($)
Closing
balance ($)
18,961
28,571
20,281
12,533
44,779
16,285
55,404
183,832
-
287
17,019
-
2,936
137,770
28,620
47,278
-
219,829
291,614
69,686
7,318
8,741
397,952
813,792
-
-
-
-
-
-
-
(3,044)
(1,427)
(1,488)
(189)
(6,148)
349
(743)
(1,186)
(250)
861
(278)
(1,527)
(8,926)
(1,122)
6
(1,087)
(19,310)
(7,327)
(14,679)
(8,635)
(43,206)
(5,835)
(129,241)
-
23,437
142,186
32,268
49,712
10,172
141,421
(170,165)
294,928
(47,081)
(4,962)
-
19,995
2,460
24,673
(13,903)
(450,441)
741,252
54
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 11. Non-current assets - property, plant and equipment (continued)
31 December 2020
Survey equipment
Furniture and fixtures
Motor vehicles
Office equipment
IT equipment
Leasehold improvements
Drone accessories
Small assets
Drones
Other fixed assets
Capital works in progress
Opening
balance ($)
Additions ($)
Disposals ($)
Foreign
exchange
movements ($)
Depreciation
($)
Closing
balance ($)
-
24,924
12,259
12,353
101,471
35,644
67,203
-
318,647
563
-
31,762
12,552
12,339
4,483
15,466
14,195
73,305
6,163
108,319
-
17,019
-
-
-
-
-
(3,150)
(957)
(1,492)
(12,801)
(5,755)
(3,360)
(2,811)
(5,556)
(14,227)
(52,375)
-
(4,802)
-
(4,629)
(11,312)
(28,925)
(68,990)
-
(6,163)
18,961
28,571
20,281
12,533
44,779
16,285
55,404
-
(1,925)
(39,605)
(201,604)
183,832
-
-
(73)
-
(203)
-
287
17,019
573,064
295,603
(12,283)
(75,445)
(382,987)
397,952
Note 12. Non-current assets - right-of-use assets
Land and buildings - right-of-use
Less: Accumulated depreciation
Consolidated
2021 ($)
397,700
(276,079)
2020 ($)
368,680
(191,376)
121,621
177,304
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year
are set out below:
Consolidated
Balance at 1 January 2020
Additions
Exchange differences
Depreciation expense
Balance at 31 December 2020
Additions
Exchange differences
Transfers in/(out)
Balance at 31 December 2021
Land and
buildings ($)
Total ($)
202,463
202,463
92,882
92,882
(26,304)
(26,304)
(91,737)
(91,737)
177,304
20,694
16,215
177,304
20,694
16,215
(92,592)
(92,592)
121,621
121,621
Right-of-use assets relate to rental properties used in South Africa.
55
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 13. Non-current assets - intangibles
Brand Names - at cost
Less: Accumulated amortisation
Client contracts - at cost
Less: Accumulated amortisation
Licenses to operate - at cost
Less: Accumulated amortisation
Domain, manuals and processes - at cost
Less: Accumulated amortisation
Consolidated
2021 ($)
30,235
(29,228)
1,007
194,837
(194,837)
-
120,942
(116,910)
4,032
94,594
(94,320)
274
2020 ($)
30,990
(23,759)
7,231
-
-
-
123,960
(95,036)
28,924
96,956
(94,993)
1,963
5,313
38,118
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year
are set out below:
Consolidated
Balance at 1 January
2020
Additions through business
combinations (note 31)
Brand
names ($)
Licenses
to operate
($)
Domain,
manuals and
processed
($)
USA
licenses ($)
Technology
($)
Customer
relationships
($)
Total ($)
15,435
61,741
9,843
-
-
-
87,019
-
-
-
1,569,000
734,000
2,376,000
4,679,000
Exchange differences
(2,005)
(8,022)
(1,278)
-
-
-
(11,305)
Amortisation expense
(6,199)
(24,795)
(6,602)
(5,370)
(2,512)
(6,506)
(51,984)
Balance at 31 December
2020
Classified as held for sale
Exchange differences
7,231
28,924
1,963
1,563,630
731,488
2,369,494
4,702,730
-
90
-
355
-
24
(1,367,639)
(639,801)
(2,132,024)
(4,139,464)
-
-
-
469
Amortisation expense
(6,313)
(25,248)
(1,713)
(195,991)
(91,687)
(237,470)
(558,422)
Balance at 31 December
2021
1,008
4,031
274
-
-
-
5,313
Note 14. Non-current assets - deferred tax
Deferred tax asset
Consolidated
2021 ($)
97,542
2020 ($)
50,930
56
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 15. Non-current assets - Goodwill
Goodwill
Consolidated
2021 ($)
1,403,438
2020 ($)
580,824
Goodwill relates to the acquisition of Rocketmine (Pty) Ltd (South Africa), and Arvista Pty Ltd (Australia).
The recoverable amount of all cash-generating units is based on the higher of its value-in-use or fair value less
costs to sell which require use of assumptions. For the purpose of impairment testing, goodwill is allocated
to two (2) cash-generating units (CGU), being Delta Drone South Africa and Australia. In assessing goodwill
impairment for the year ended 31 December 2021, all CGUs used a discounted cash flow model in accordance
with the value-in-use (VIU) method, which reflect the present value of the future cash flows expenditure to be
derived from each CGUs. The allocation of the fair value to goodwill arising on acquisition of Arvista Pty Ltd has
been made on a provisional basis. Under AASB 3 – Business Combinations management has up to 12 months
to finalise the carrying value of assets and liabilities acquired on completion of an acquisition. The significant
inputs and key assumptions used by management within the discounted cash flow model for the Delta Drone
South Africa CGU and Arvista Pty Ltd CGU are:
Delta Drone South Africa (Pty) Ltd
• Discount rate (pre-tax): risk in the industry and
Arvista Pty Ltd
• Discount rate (pre-tax): risk in the industry and
country in which it operates – 16.3%.
country in which it operates – 15.0%.
• Revenue growth: relevant to the market conditions
• Revenue growth: relevant to the market conditions
and business plan – 31.4%.
and business plan – 33.5%
• Budgeted gross profit rate: based on past
• Budgeted gross profit rate: based on past
performance and management’s expectations
for the future – 54.7%.
performance and management’s expectations
for the future – 35.0%.
• Long term growth rate: typically consistent with the
long-term growth rate of the economic environment
or country in which it operates.
• Long term growth rate: typically consistent with the
long-term growth rate of the economic environment
or country in which it operates.
Note 16. Current liabilities - trade and other payables
Trade payables
Goods and services tax
Refer to note 26 for further information on financial instruments.
Consolidated
2021 ($)
431,388
39,330
2020 ($)
408,425
-
470,718
408,425
57
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 17. Current liabilities - contract liabilities
Contract liabilities
Reconciliations
Reconciliation of the written down values at the beginning and end of the
current and previous financial year are set out below:
Opening balance
Payments received in advance
Closing balance
Note 18. Current liabilities - borrowings
Short-term loan
Refer to note 26 for further information on financial instruments.
Consolidated
2021 ($)
114,850
-
114,850
114,850
2020 ($)
-
-
-
-
Consolidated
2021 ($)
350,000
2020 ($)
506,839
The borrowing represents a short-term bridge financing by way of an unsecured line of credit (“loan”) of
$350,000 (2020: $500,000) advanced by Delta Drone SA France with an interest rate of 2.5% (2020: 10%) per
annum. The loan and the accrued interest were repaid subsequent to the year end.
Note 19. Current liabilities - lease liabilities
Lease liability
Refer to note 26 for further information on financial instruments.
Note 20. Current liabilities – deferred consideration
Deferred consideration - Arvista Pty Ltd acquisition
Consolidated
2021 ($)
97,638
2020 ($)
79,194
Consolidated
2021 ($)
271,483
2020 ($)
-
Deferred consideration
The deferred provision represents the obligation to pay contingent consideration following the acquisition of
Arvista Pty Ltd in the year. It is measured at the present value of the estimated liability. This consideration is to
be paid in cash one month after the annual report is provided to the Australian Securities Exchange (ASX).
58
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 21. Current liabilities - liabilities directly associated with assets classified as
held for sale
Trade payables
Deferred tax liability
Consolidated
2021 ($)
932,302
750,302
1,682,604
2020 ($)
998,997
748,000
1,746,997
Refer to note 26 for further information on financial instruments.
Non-current borrowings relate to motor vehicle finance leases and long-term borrowing from a supplier.
Note 22. Non-current liabilities - borrowings
Borrowings
Refer to note 26 for further information on financial instruments.
Consolidated
2021 ($)
105,253
2020 ($)
-
Non-current borrowings relate to motor vehicle finance leases and long-term borrowing from a supplier.
Note 23. Non-current liabilities - lease liabilities
Lease liability
Refer to note 26 for further information on financial instruments.
Consolidated
2021 ($)
56,003
2020 ($)
122,642
59
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 24. Equity - issued capital
Ordinary shares - fully paid
511,604,932
500,800,731
13,207,118
12,904,061
Consolidated
2021 Shares
2020 Shares
2021 ($)
2020 ($)
Movements in ordinary share capital
Details
Balance
Date
Shares
Issue price
($)
1 January 2020
139,082,099
1,735,384
Conversion of convertible notes
22 December 2020
12,500,000
$0.0040
500,000
Conversion of convertible notes
22 December 2020
14,705,882
$0.0340
500,000
Issue of shares to acquire Delta Drone South Africa
22 December 2020
203,512,750
$0.0273
5,563,284
Issue of shares pursuant to Prospectus
22 December 2020
125,000,000
$0.0400
5,000,000
Issue of Broker Shares
Capital raising costs
22 December 2020
6,000,000
$0.0400
240,000
22 December 2020
Balance
31 December 2020
500,800,731
Issue of shares on exercise of options
10 February 2021
579,201
$0.0027
Issue of shares to third party
10 March 2021
625,000
$0.0310
Issue of shares for acquisition of Arvista Pty Ltd
1 September 2021
9,600,000
$0.0300
288,000
Share issue costs
1 September 2021
-
(5,882)
Balance
31 December 2021
511,604,932
13,207,118
Ordinary shares
Ordinary shares entitle the holder to participate in
dividends and the proceeds on the winding up of the
Company in proportion to the number of and amounts
paid on the shares held. The fully paid ordinary shares
have no par value and the Company does not have a
limited amount of authorised capital.
Capital risk management
The Group’s objectives when managing capital is to
safeguard its ability to continue as a going concern,
so that it can provide returns for shareholders and
benefits for other stakeholders and to maintain an
optimum capital structure to reduce the cost of capital.
On a show of hands every member present at a
meeting in person or by proxy shall have one vote and
upon a poll each share shall have one vote.
Capital is regarded as total equity, as recognised in
the statement of financial position, plus net debt. Net
debt is calculated as total borrowings less cash and
cash equivalents.
Share buy-back
There is no current on-market share buy-back.
In order to maintain or adjust the capital structure,
the Group may adjust the amount of dividends paid
to shareholders, return capital to shareholders, issue
new shares or sell assets to reduce debt.
60
(634,607)
12,904,061
1,564
19,375
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 25. Equity - reserves
Predecessor accounting reserves
Foreign currency reserve
Share-based payments reserve
Consolidated
2021 ($)
(968,570)
327,423
53,793
2020 ($)
(968,570)
419,845
-
(587,354)
(548,725)
Foreign currency reserve
The reserve is used to recognise exchange
differences arising from the translation of the financial
statements of foreign operations to Australian dollars.
It is also used to recognise gains and losses on
hedges of the net investments in foreign operations.
Share-based payments reserve
The reserve is used to recognise the value of equity
benefits provided to employees and Directors as part
of their remuneration, and other parties as part of their
compensation for services.
Predecessor accounting reserve
The predecessor accounting reserve comprises the
excess of purchase price over the fair value of net
assets when the common controlled entity, Drone
Safety and Legal (Pty) Ltd was acquired by Delta
Drone SA France.
61
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 26. Financial instruments
Financial risk management objectives
The Group’s objective when managing capital is to
safeguard its ability to continue as a going concern so
that it can continue to provide returns for shareholders
and benefits to other stakeholders and to maintain an
optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure,
the Group may adjust the amount of dividends paid,
return capital to shareholders, issue new shares or sell
assets to reduce debt.
The Group’s activities expose it to a variety of financial
risks: market risk (including foreign currency risk, price
risk and interest rate risk), credit risk and liquidity risk.
Given the nature of the business, the Group monitors
capital on the basis of current business operations
and cash flow requirements. There were no changes
in the Group’s approach to capital management during
the year.
Risk management is carried out by senior finance
executives (‘finance’) under policies approved by the
Board of Directors (‘the Board’). These policies include
identification and analysis of the risk exposure of
the Group and appropriate procedures, controls and
risk limits. Finance identifies, evaluates and hedges
financial risks within the Group’s operating units.
Finance reports to the Board on a monthly basis.
Financial assets
Cash and cash equivalents
Trade and other receivables
Financial assets held at amortised cost
Financial liabilities
Trade and other payables
Bank overdraft
Lease liabilities
Borrowings
Deferred consideration
Consolidated
2021 ($)
2020 ($)
954,916
1,415,957
34,869
4,991,134
789,758
35,531
2,405,742
5,816,423
470,718
18,895
153,371
455,253
271,483
408,425
31
201,836
506,839
1,369,720
1,117,131
The fair value of the above financial instruments approximates their carrying values.
Market risk
Foreign currency risk
The Group undertakes certain transactions
denominated in foreign currency and is exposed
to foreign currency risk through foreign exchange
rate fluctuations.
Foreign exchange risk arises from future
commercial transactions and recognised financial
assets and financial liabilities denominated in a
currency that is not the entity’s functional currency.
The risk is measured using sensitivity analysis and
cash flow forecasting.
The Group is exposed to foreign exchange risk
arising from various currency exposures primarily with
respect to the US Dollar (the functional currency of
the Israeli subsidiary company now held for sale), the
New Israeli Shekel, the Australian Dollar (functional
currency of the Parent company) and the South
African Rand (the functional currency of the South
African subsidiaries).
62
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Interest rate risk
The Group’s main interest rate risk arises from
borrowings. Borrowings obtained at variable rates
expose the Group to interest rate risk.
Price risk
The Group is not exposed to any significant price risk
Consolidated - 2021
Basis points
change
Basis points
increase profit
before tax
Effect on
equity
Basis points
change
Basis points
decrease Effect on
profit before tax
Effect on
equity
Cash and cash equivalents
100
9,549
9,549
(100)
(9,549)
(9,549)
Consolidated - 2020
Basis points
change
Basis points
increase profit
before tax
Effect on
equity
Basis points
change
Basis points
decrease Effect on
profit before tax
Effect on
equity
Cash and cash equivalents
100
49,911
49,911
(100)
(49,911)
(49,911)
trade receivables through the use of a provisions
matrix using fixed rates of credit loss provisioning.
These provisions are considered representative
across all customers of the Group based on recent
sales experience, historical collection rates and
forward-looking information that is available.
Generally, trade receivables are written off when there
is no reasonable expectation of recovery. Indicators
of this include the failure of a debtor to engage in a
repayment plan, no active enforcement activity and
a failure to make contractual payments for a period
greater than 1 year.
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 a
strict code of credit, including obtaining agency
credit information, confirming references and
setting appropriate credit limits. The Group obtains
guarantees where appropriate to mitigate credit risk.
The maximum exposure to credit risk at the reporting
date to recognised financial assets is the carrying
amount, net of any provisions for impairment of those
assets, as disclosed in the statement of financial
position and notes to the financial statements. The
Group does not hold any collateral.
The Group has adopted a lifetime expected loss
allowance in estimating expected credit losses to
Allowance for expected credit losses
The Group has recognised a loss of $6,095 (31
December 2020: $7,946) in profit or loss in respect
of the expected credit losses for the year ended 31
December 2021.
63
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The ageing of the receivables and allowance for expected credit losses provided for above are as follows:
Expected credit loss rate
Carrying amount
Allowance for expected
credit losses
Consolidated
Not overdue
2021
%
-
2020
%
2021
%
2020
%
-
1,059,504
515,374
0 to 3 months overdue
74.69%
18.00%
8,160
3 to 6 months overdue
-
20.36%
-
30,162
12,362
2021
%
-
6,095
-
1,067,664
557,898
6,095
2020
%
-
5,429
2,517
7,946
Liquidity risk
Vigilant liquidity risk management requires the Group
to maintain sufficient liquid assets (mainly cash and
cash equivalents) and available borrowing facilities to
be able to pay debts as and when they become due
and payable.
The Group manages liquidity risk by maintaining
adequate cash reserves and available borrowing
facilities by continuously monitoring actual and
forecast cash flows and matching the maturity profiles
of financial assets and liabilities.
Remaining contractual maturities
The following tables detail the Group’s remaining
contractual maturity for its financial instrument
liabilities. The tables have been drawn up based on
the undiscounted cash flows of financial liabilities
based on the earliest date on which the financial
liabilities are required to be paid. The tables include
both interest and principal cash flows disclosed as
remaining contractual maturities and therefore these
totals may differ from their carrying amount in the
statement of financial position.
Weighted
average
interest rate
(%)
1 year or less
($)
Between 1
and 2 years ($)
Between 2
and 5 years ($)
Over 5 years
($)
Remaining
contractual
maturities ($)
Consolidated - 2021
Non-derivatives
Non-interest bearing
Trade payables
Deferred consideration
Non-interest bearing
Bank overdraft
Lease liability
Interest-bearing - fixed rate
-
-
-
470,718
271,483
18,895
97,638
-
-
56,003
Borrowings
2.50%
350,000
-
Total non-derivatives
-
1,208,734
56,003
-
-
-
-
-
-
-
-
-
-
470,718
271,483
18,895
153,641
350,000
1,264,737
64
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Weighted
average
interest rate
(%)
1 year or less
($)
Between 1
and 2 years ($)
Between 2
and 5 years ($)
Over 5 years
($)
Remaining
contractual
maturities ($)
Consolidated - 2020
Non-derivatives
Non-interest bearing
Trade payables
Non-interest bearing
Lease liability
Interest-bearing - fixed rate
-
-
408,425
-
79,194
122,642
-
-
-
-
-
-
-
-
408,425
201,836
506,839
1,117,100
Borrowings
10.00%
506,839
-
Total non-derivatives
-
994,458
122,642
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually
disclosed above.
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
Note 27. Key management personnel disclosures
Directors
The following persons were Directors of Delta Drone International Limited during the financial year:
Eden Attias
Executive Chairman
Christopher Clark
Chief Executive Officer
Stephen Gorenstein
Non-Executive Officer
Clive Donner
Nicolas Clerc
Christian Viguie
Dan Arazi
Chris Singleton
Non-Executive Officer (appointed 14 July 2021)
Non-Executive Officer (appointed 8 April 2021)
Non-Executive Officer (appointed 8 April 2021)
Non-Executive Officer (resigned 21 June 2021)
Non-Executive Officer (resigned 14 July 2021)
65
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Compensation
The aggregate compensation made to Directors and other members of key management personnel of the
Group is set out below:
Short-term employee benefits
Post-employment benefits
Share-based payments
Consolidated
2021 ($)
482,402
14,638
53,794
550,834
2020 ($)
432,085
770
-
432,855
Note 28. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by BDO Audit (WA) Pty
Ltd, the auditor of the Company, and its network firms:
Audit services -
Audit or review of the financial statements
Other services -
Investigating Accountant’s Report
- BDO Corporate Finance (WA) Pty Ltd
Audit services - network firms
Audit or review of the financial statements
Consolidated
2021 ($)
2020 ($)
71,000
58,000
-
71,000
-
60,600
60,600
118,600
54,831
60,327
Note 29. Related party transactions
Parent entity
Delta Drone International Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 32.
Key management personnel
Disclosures relating to key management personnel
are set out in note 27 and the remuneration report
included in the Directors’ report.
Transactions with related parties
There were no transactions with related parties during
the current and previous financial year.
Receivable from and payable to related parties
There were no trade receivables from or trade
payables to related parties at the current and previous
reporting date.
66
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Loans from related parties
The following balances are outstanding at the reporting date in relation to loans with related parties:
Current borrowings:
Loan from Delta Drone SA (France)
Consolidated
2021 ($)
2020 ($)
350,000
506,838
As at 31 December 2021, Delta Drone International Limited held a loan payable balance of $350,000
(31 December 2020: $500,000), which was owed to Delta Drone SA (France), a related party which holds a
majority shareholding in the Company. The loan bears an interest of 2.5% (2020: 10%) per annum. This loan
balance was repaid in full post-year end.
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
Note 30. Parent entity information
Loss after income tax
Assets
Current assets
Total assets
Liabilities
Current assets
Total liabilities
Net Assets
Shareholders’ Equity
Issued capital
Reserves
Accumulated losses
Parent 2021 ($)
Parent 2020 ($)
(4,064,639)
(17,429,836)
Parent 2021 ($)
Parent 2020 ($)
562,846
562,846
(708,660)
(708,660)
4,340,808
4,340,808
(726,869)
(726,869)
(145,814)
3,613,939
19,418,100
1,924,512
(21,488,426)
(145,814)
19,115,043
1,922,683
(17,423,787)
3,613,939
Guarantees entered into by the parent entity in
relation to the debts of its subsidiaries
The parent entity had no guarantees in relation to the
debts of its subsidiaries as at 31 December 2021 and
31 December 2020.
Contingent liabilities
The parent entity had no contingent liabilities as at 31
December 2021 and 31 December 2020.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for
property, plant and equipment as at 31 December
2021 and 31 December 2020.
67
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 31. Business combinations
Arvista Pty Ltd
On 1 September 2021 Delta Drone International
Limited acquired 60% of the ordinary shares of
Arvista Pty Ltd for the total consideration transferred
of $859,483. The acquired business contributed
revenues of $553,836 and profit after tax of $39,760
to the Group for the period from 1 September 2021 to
31 December 2021. The goodwill on acquisition was
$836,758 which arose as the difference between the
fair value of consideration paid and the total tangible
assets transferred and represents the access to
blue-chip Australian client base and highly skilled
professionals allowing the Group to expand its
offering beyond surveying. If the acquisition occurred
on 1 January 2021, the full year contributions would
have been revenues of $1,396,352 and loss after tax
of $80,584.
Details of the acquisition are as follows:
Deferred consideration
There is a deferred consideration portion of $271,483
that is due within one (1) month of the submission of
the 31 December 2021 annual report to the Australian
Securities Exchange (ASX).
Call Option
The Shareholders Agreement provides for a call
option where the Group has the right to purchase the
remaining 40% interest in Arvista Pty Ltd at 1.5 times
the 12-month trading revenue on the purchase price
for 31 August 2021. The option is valid for 5 years. As
the option exercise price is linked to the fair value of
the business, the directors have determined that the
option is immaterial.
Cash and cash equivalents
Trade receivables
Other current assets
Plant and equipment
Motor vehicles
Trade payables
Employee benefits
Other borrowings
Net assets acquired
Goodwill
Non-controlling interest
Acquisition-date fair value of the total consideration transferred
Representing:
Cash paid or payable to vendor
Delta Drone International Limited shares issued to vendor
Deferred consideration
Cash used to acquire business, net of cash acquired:
Acquisition-date fair value of the total consideration transferred
Less: cash and cash equivalents
Less: payments to be made in future periods
Less: shares issued by theCompany as part of consideration
Net cash used
Fair value ($)
68,787
173,595
1,092
1,867
13,739
(161,201)
(58,922)
(1,082)
37,875
836,758
(15,150)
859,483
300,000
288,000
271,483
859,483
859,483
(68,787)
(271,483)
(288,000)
231,213
* The non-controlling interest has been calculated by the proportionate share of net asset method.
Fair value measured on a provisional basis
The allocation of the fair value to goodwill has been made on a provisional basis. Under AASB 3 – Business
Combinations management has up to 12 months to finalise the carrying value of assets and liabilities acquired
on completion of an acquisition.
68
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 32. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries
in accordance with the accounting policy described in note 1:
Name
ParaZero Technologies
Delta Drone South Africa (Pty) Ltd
Drone Safety and Legal (Pty) Ltd
Rocketmine South Africa
Rocketmine Ghana
Rocketmine Australia Pty Ltd
Arvista Pty Ltd
Principal place of business /
Country of incorporation
Ownership
interest 2021 ($)
Ownership
interest 2020 ($)
Israel
South Africa
South Africa
South Africa
Ghana
Australia
Australia
100.00%
100.00%
100.00%
74.00%
90.00%
100.00%
60.00%
100.00%
100.00%
100.00%
74.00%
90.00%
100.00%
-
Note 33. Events after the reporting period
On 28 January 2022 the Group announced that it had
entered into a binding agreement with a consortium
of investors led by NASDAQ-listed Medigus Ltd
and facilitated by Israeli venture capital firm L.I.A
Pure Capital Ltd to sell ParaZero Technologies Ltd
(“ParaZero”) which operated the Company’s drone
safety business, for a total consideration of A$6
million in cash. This transaction allows the Group to
focus on becoming one of the leading drone service
providers globally after its successful acquisition of
the Delta Drone South Africa business in December
2020 and the purchase of Arvista Pty Ltd in Australia
in September 2021. Post-sale this will leave the
Company with a strengthened balance sheet and
a substantially reduced need for cash to fund the
ongoing R&D investment that had been required by
the ParaZero business, allowing the Group to focus
on aggressively growing its global drone services
business. As such, the assets (including goodwill
and intangible assets), liabilities and net profit of
the Parazero operations have been classified as
assets held for sale and liabilities directly attributed
to discontinued operations in the 31 December 2021
report.
No other matter or circumstance has arisen since 31
December 2021 that has significantly affected, or may
significantly affect the Group’s operations, the results
of those operations, or the Group’s state of affairs in
future financial years.
69
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 34. Reconciliation of loss after income tax to net cash from/(used in)
operating activities
Loss after income tax benefit/(expense) for the year
Adjustments for:
Depreciation and amortisation
Share-based payments
Foreign exchange differences
Gain on sale of assets
Interest received
Finance costs
Expected credit loss allowance
Change in operating assets and liabilities:
Increase in trade and other receivables
Decrease/(increase) in inventories
Decrease/(increase) in income tax refund due
Increase in deferred tax assets
Increase in trade and other payables
Increase in contract liabilities
Consolidated
2021 ($)
(3,590,483)
2020 ($)
(115,391)
1,064,076
202,293
53,793
(92,422)
(11,123)
-
7,487
6,095
(318,694)
6,185
(135,576)
(146,070)
180,124
114,850
-
585
(20,332)
(26,292)
110,723
(5,019)
(289,083)
(472,719)
86,446
-
829,498
-
Net cash from/(used in) operating activities
(2,861,758)
300,709
Note 35. Non-cash investing and financing activities
Shares issued in relation to business combinations
Consolidated
2021 ($)
2020 ($)
288,000
-
The Company issued 9,600,000 shares as part of the business combination to acquire Arvista Pty Ltd during the
year. Refer to note 31 for more information.
70
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 36. Changes in liabilities arising from financing activities
Consolidated
Balance at 1 January 2020
Net cash used in financing activities
Loans received
Acquisition of leases
Exchange differences
Changes in fair values
Other changes
Balance at 31 December 2020
Net cash used in financing activities
Proceeds from loans
Addition on business combination
Exchange differences
Changes in fair values
Balance at 31 December 2021
There are no other non-cash investing and financing activities.
Note 37. Earnings per share
Loss per share for loss from continuing operations
Loss after income tax
Non-controlling interest
Loss after income tax
Weighted average number of ordinary shares used in calculating basic earnings per share
Weighted average number of ordinary shares used in calculating diluted earnings per share
Basic loss per share
Diluted loss per share
Loss per share for loss from discontinued operations
Loss after income tax
Weighted average number of ordinary shares used in calculating basic earnings per share
Weighted average number of ordinary shares used in calculating diluted earnings per share
Basic loss per share
Diluted loss per share
Total Basic loss per share
Total Diluted loss per share
Borrowing ($)
3,354,742
(167,707)
500,000
-
-
6,839
(3,187,035)
506,839
(512,111)
454,821
1,082
4,620
-
Lease
liabilies ($)
226,740
(103,384)
-
92,882
(29,459)
15,058
Total ($)
3,581,482
(271,091)
500,000
92,882
(29,459)
21,897
-
(3,187,035)
201,837
(49,062)
-
-
(867)
708,676
(561,173)
390,000
1,082
4,620
(867)
455,241
151,908
607,149
Consolidated
2021 ($)
2020 ($)
(1,705,749)
(27,324)
(61,003)
(68,568)
(1,733,073)
(129,571)
Number
505,033,787
505,033,787
Number
144,191,756
144,191,756
Cents
(0.34)
(0.34)
Cents
(0.09)
(0.09)
Consolidated
2021 ($)
2020 ($)
(1,884,734)
(54,388)
Number
505,033,787
505,033,787
Number
144,191,756
144,191,756
Cents
(0.37)
(0.37)
Cents
(0.71)
(0.71)
Cents
(0.04)
(0.04)
Cents
(0.13)
(0.13)
71
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 38. Share-based payments
The Group provided performance rights to selected
directors as a part of their remuneration package and
as a performance incentive – the Board considers
that performance rights are an appropriate form of
incentive as they align remuneration with the long-
term success of the Group, shareholder interests
and current market practice.
Vesting of the performance rights is conditional on
the satisfaction of various milestones within a three (3)
year timeframe. The performance rights were issued
at nil cost and will be converted into the equivalent
number of shares when exercised.
2021
Grant date
Expiry date
24/06/2021
24/06/2024
Balance at the
start of the year
Granted
Exercised
-
-
14,000,000
14,000,000
-
-
Expired/
forfeited/ other
Balance at the
end of the year
(1,000,000)
(1,000,000)
13,000,000
13,000,000
Set out below are summaries of performance rights granted under the plan:
Outstanding at the beginning of the financial year
Granted
Forfeited
Outstanding at the end of the financial year
Number of rights
2021
-
14,000,000
(1,000,000)
13,000,000
There were 14,000,000 performance rights over
ordinary shares issued to Directors as part of
compensation during the year ended 31 December
2021. Shareholders of the Company approved the
issue of the Performance Rights at the Annual General
Meeting of the Company held on 24 June 2021.
During the year 1,000,000 performance rights held by
Chris Singleton were forfeited due to his resignation.
As at 31 December 2021, an expense of $53,794
based on a fair value of $0.024 per right has been
recognised as share-based payment in the statement
of profit or loss and other comprehensive income
which represents the pro-rated value from 24 June
2021 (grant date) to 31 December 2021. Total value
of the remaining 13,000,000 Performance Rights will
be expensed over management’s expected vesting
period of 3 years. No performance rights have vested
in the year ended 31 December 2021.
72
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The details of allottees and the Milestones are described in the tables below
Name
Eden Attias
Eden Attias
Eden Attias
Christopher Clark
Christopher Clark
Christopher Clark
Christopher Clark
Christopher Clark
Christopher Clark
Stephen Gorenstein
Stephen Gorenstein
Stephen Gorenstein
DDG Milestones
Milestone
Description
No. of Performance Rights
Milestones
2,000,000
New Milestone 1
2,000,000
New Milestone 2
2,000,000
New Milestone 3
666,667
666,667
666,667
DDG Milestone 1
DDG Milestone 2
DDG Milestone 3
1,333,334
New Milestone 1
1,333,334
New Milestone 2
1,333,334
New Milestone 3
333,334
333,334
333,334
13,000,000
New Milestone 1
New Milestone 2
New Milestone 3
DDG
Milestone 1
DDSA achieving consolidated revenue (for the avoidance of doubt, only DDSA and excluding the Group) for any
full financial year (being 1 Jan to 31 Dec) during the three-year term of the Performance Rights of not less than
US$3,200,000 (based on audited accounts having been prepared by an external auditor or other suitable expert).
If DDSA enters into at least two binding contracts with Australian-based mining companies (being companies that
conduct mining, exploration or extraction services) for the provision of drone survey or mapping solutions services
DDG
to those mining companies in Australia (“Services”) and DDSA receives not less than US$1,000,000 (based on
Milestone 2
audited accounts having been prepared by an external auditor or other suitable expert) of verified revenue in
aggregate from such executed contracts received within the three-year term of the Performance Rights for its
Services.
If during the three-year term of the Performance Rights, the Company announces to the ASX that DDSA has
DDG
Milestone 3
expanded the services of its business offering (being the provision of drone survey and mapping solutions) into a
new geographic location outside of Australia, Israel, South Africa, Ghana and Namibia and achieved a revenue in
that new geographic location of not less than US$1,000,000 (based on audited accounts having been prepared by
an external auditor or other suitable expert).
Note: DDSA means Delta Drone South Africa and its current subsidiaries, Drone Safety and Legal, Rocketmine
South Africa and Rocketmine Ghana.
New Milestones
Milestone
Description
New
The Group achieving consolidated revenue of not less than A$10,000,000 in a single financial year (being 1 Jan to
Milestone 1
31 Dec) based on audited accounts having been prepared by an external auditor or other suitable expert.
New
The Group achieving total consolidated EBITDA of not less than A$1,000,000 in a single financial year (being 1 Jan
Milestone 2
to 31 Dec) based on audited accounts having been prepared by an external auditor or other suitable expert.
New
Milestone 3
The Company achieving a total return on equity of not less than 10% in a single financial year (being 1 Jan to 31
Dec), where return on equity is equal to net profit as a percentage of total equity based on audited accounts
having been prepared by an external auditor or other suitable expert.
73
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Note 38. Share-based payments (continued)
In the prior year the Company issued 45,000,000 Performance Shares for which $nil value was ascribed to
as part of the acquisition accounting. The Performance Shares will convert to new shares according to the
following milestones:
Class C Performance Shares
Each Class C Performance Share entitles Delta Drone
SA France to subscribe for one fully paid ordinary
share in the capital of the Company if during the
three-year term of the Class C Performance Shares
the Company announces to the ASX that Delta Drone
South Africa has expanded the services of its business
offering (being the provision of drone survey and
mapping solutions) into a new geographic location
outside of Australia, Israel South Africa, Ghana and
Namibia and achieved a revenue in that geographic
location of not less than US$1,000,000 (“Third
Performance Milestone”).
If a Performance Milestone is not satisfied within
3 years of the date of issue of the Performance
Shares (being 22 December 2020), then the relevant
Performance Shares will automatically lapse.
Class A Performance Shares
Each Class A Performance Share entitles Delta Drone
SA France to subscribe for one fully paid ordinary
share in the capital of the Company if Delta Drone
South Africa achieves consolidated revenue (for
avoidance of doubt, only Delta Drone South Africa
and excluding the Company) for any full financial
year (being 1 January to 31 December) during the
three-year term of the Class A Performance Share
of not less than US$3.2 million (“First Performance
Milestone”).
Class B Performance Shares
Each class B Performance Share entitles Delta
Drone SA France to subscribe for one fully paid
ordinary share in the capital of the Company if
Delta Drone South Africa enters into at least two
binding contracts with Australian based mining
companies (being companies that conduct mining,
exploration or extraction activities) for the provision
of drone survey or mapping solution services to
those mining companies in Australia (“Services”)
and Delta Drone South Africa receives not less than
US$1,000,000 (based on audited accounts) of verified
revenue in aggregate form from such executed
contracts received within the three-year term of
the Performance Shares for its Services (“Second
Performance Milestone”).
74
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
DIRECTORS’ DECLARATION
Directors’ declaration
In the Directors’ opinion:
• the attached financial statements and notes comply with the Corporations Act 2001, the Accounting
Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements;
• the attached financial statements and notes comply with International Financial Reporting Standards as issued
by the International Accounting Standards Board as described in note 1 to the financial statements;
• the attached financial statements and notes give a true and fair view of the Group’s financial position as at
31 December 2021 and of its performance for the financial year ended on that date; and
• there are reasonable grounds to believe that the Company will be able to pay its debts as and when they
become due and payable.
The Directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of Directors made pursuant to section 295(5)(a) of the Corporations
Act 2001.
On behalf of the Directors
Christopher Clark
Chief Executive Officer
31 March 2022
75
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DELTA DRONE INTERNATIONAL LIMITED
76
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DELTA DRONE INTERNATIONAL LIMITED
77
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DELTA DRONE INTERNATIONAL LIMITED
78
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DELTA DRONE INTERNATIONAL LIMITED
79
DELTA DRONE INTERNATIONAL LIMITED ANNUAL REPORT 2021 DELTA DRONE INTERNATIONAL ANNUAL REPORT 2022
ASX ADDITIONAL INFORMATION
The shareholder information set out below was applicable as at 6 March 2022.
As at 6 March 2022, there were 706 holders of fully paid ordinary shares.
VOTING RIGHTS
The voting rights of the ordinary shares are as follows:
Subject to any rights or restrictions for the time being
attached to any shares or class of shares of the
Company, each member of the Company is entitled
to receive notice of, attend and vote at a general
meeting. Resolutions of members will be decided
by a show of hands unless a poll is demanded. On a
show of hands each eligible voter present has one
vote. However, where a person present at a general
meeting represents personally or by proxy, attorney or
representation more than one member, on a show of
hands the person is entitled to one vote only despite
the number of members the person represents.
On a poll each eligible member has one vote for each
fully paid share held.
There are no voting rights attached to any of the
options and performance options that the Company
currently has on issue. Upon exercise of these options,
the shares issued will have the same voting rights as
existing ordinary shares.
TWENTY LARGEST SHAREHOLDERS
The names of the twenty largest holders of Ordinary Fully Paid Shares are:
Holder Name
Delta Drone SA
The Trust Company (Australia) Limited
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