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Cornerstone FS PLCAnnual Financial Report
Year ended 30 June 2012
ABN: 95 000 969 362
Table of Contents
for the year ended 30 June 2012
TTHE BOARD OF DIRECTORS
THE SENIOR MANAGEMENT TEAM
CEO AND CHAIRMAN’S COMMENTARY
DIRECTORS’ REPORT
CORPORATE GOVERNANCE STATEMENT
STATEMENT OF COMPREHENSIVE INCOME
STATEMENT OF FINANCIAL POSITION
STATEMENT OF CHANGES IN EQUITY
STATEMENT OF CASH FLOWS
NOTES TO THE FINANCIAL STATEMENTS
SHAREHOLDER INFORMATION
DIRECTORS’ DECLARATION
AUDITOR’S INDEPENDENCE DECLARATION
INDEPENDENT AUDITOR’S REPORT
2
2
3
4
13
20
21
22
23
24
43
46
47
48
Dicker Data Limited | Annual Report 2012
1
Dicker Data Ltd
for the year ended 30 June 2012
Board of Directors
David Dicker
Chairman and Chief Executive Offi cer
Fiona Brown
Non-Executive Director
Mary Stojcevski
Executive Director
Michael Demetre
Executive Director
Chris Price
Executive Director
The Senior Management Team
Senior management team serving at year end
David Dicker
Chairman and Chief Executive Offi cer
Chris Price
Commercial Director
Mary Stojcevski
Chief Financial Offi cer
Michael Demetre
Logistics Director
Vladimir Mitnovetski
Category Manager
2
Dicker Data Limited | Annual Report 2012
CEO Commentary
for the year ended 30 June 2012
Welcome to our second Annual Report as a public company.
Our results for this year, with revenue of $457m and net profi t after tax of $8.3m show a very
solid improvement from last year. The economic conditions have probably been more diffi cult
but the tremendous performance by our employees and management team have allowed us to
improve on the previous year. Despite the diffi cult economic conditions the results are our best
ever reported, refl ecting consistent strong performance.
As at 15th August 2012 our shares were trading at 45 cents, up from the IPO fi gure of 20 cents.
We are also adding 5,000 square metres to our existing warehouse of 4,000 square metres.
All good and all auguring well for the future.
However despite the results, we continue to struggle with the majority of the analyst community.
I am constantly told that our dividends are too high, we do not have ‘independent’ directors and
there are not enough shares with the public. Rather than discuss this in detail I will just say that
our results speak loudly and that I am very comfortable with our strategies.
We expect to increase the public holding in DDR to 15% this year.
David Dicker
CEO and Chairman
Sydney, 31 August 2012
Dicker Data Limited | Annual Report 2012
3
Directors’ Report
for the year ended 30 June 2012
Your directors present their report on Dicker Data Limited (Dicker Data) for the year ended 30 June 2012.
1. Principal activities
The principal activities of the company during the year were wholesale distribution of computer hardware and
related products. There were no signifi cant changes in the nature of the activities carried out during the year.
2. Dividends
Record Date
Payment Date
Type
Cents
$’000
Dividends declared and paid during the fi nancial year:
21-Sep-11
5-Jan-12
26-Mar-12
28-Sep-11
12-Jan-12
4-Apr-12
Final 2011
Interim 2012
Interim 2012
$ 0.0200
$ 0.0093
$ 0.0093
2,530
1,176
1,176
Dividends declared during the fi nancial year but not paid:
27-Jun-12
6-Jul-12
Interim 2012
$ 0.0150
1,897
3. Operating and fi nancial review
A snapshot of the operations of the company for the full year and the results of those operations are as follows:
Operating Revenues
Gross Profi t
Earnings Before Tax
Earnings Before Interest, Tax and Depreciation (EBITDA)
Net Profi t after Tax
Earnings Per Share (cents)
2012
(in 000’s)
2011
(in 000’s)
%
Change
456,648
385,246
32,367
12,265
16,098
8,276
6.55
26,178
8,788
11,779
6,132
5.02
18.5%
23.6%
39.6%
36.7%
35.0%
30.5%
Total revenue for the full year was $457m (2011 - $385m), an improvement of 18.5% on the same period last year.
The strong revenue growth was primarily driven by the improved logistics capacity that the new purpose built
warehouse provided, which was not available for the full period in the previous corresponding year. The company
relocated to the new facility in November 2010. Revenue growth can also be attributed to growth in new vendors
ASUS, Buffalo and Lenovo for which a full 12 months is not refl ected in the previous corresponding period. We
were appointed distributor for these vendors during the latter half of the previous corresponding year or during
this fi nancial year. We also managed to increase our market share with our existing vendors resulting in our highest
annual revenue to date.
Gross profi t for the full year was $32m (2011: $26m) an increase of 23.6% which is refl ective of increased sales
volume in the current year. The increase in gross profi t is also as a result of aligning our revenue with more
profi table product lines and ceasing distribution of unprofi table vendors. This is in line with the company’s overall
objective of constantly reviewing our vendor and product mix.
4
4
Dicker Data Limited | Annual Report 2012
Dicker Data Limited | Annual Report 2012
Directors’ Report
for the year ended 30 June 2012
Profi t before tax amounted to $12.3m (2011: $8.8m) an increase of 39.6% for the full year.
Net Profi t after tax amounted to $8.3m (2011: $6.1m) an increase of 35% for the full year.
Earnings per share increased by 30.5% to 6.55 cents per share.
4. Earnings per share
Basic Earnings Per Share (cents)
Diluted Earnings Per Share (cents) *
* on basis options exercised
2012
2011
6.55
6.48
5.02
5.00
5. Signifi cant changes in the state of affairs
In December 2011, Dicker Data entered into a new banking relationship with St George Bank for a total facility
amount of $56.8m, which included debtor fi nancing, asset fi nancing and other working capital facilities. The new
facility has provided the company with greater fl exibility in funding our working capital requirements.
There were no other signifi cant changes in the state of affairs of the company during the year.
6. Signifi cant events after the balance date
In August the company entered into a contract to extend the current warehouse facility by an additional 5,000 square
metres. This will more than double the existing warehouse capacity and sets the Company up for future growth.
Construction should commence in September 2012 and the project is expected to be completed in 26 weeks.
The construction will be fi nanced from the Company’s cash fl ows and drawing on existing funding already in place
with St George Bank.
7. Likely developments and expected results
In the 2013 fi nancial year we will continue to focus on reviewing our vendor and supplier mix and adjust accordingly
to meet current market conditions. Consequently, the objective will be long term profi tability for Dicker Data.
Signifi cant focus will be placed on off-premise IT capabilities (datacentre and cloud strategies), which is anticipated
will result in higher infrastructure, service and annuity revenues. The increased warehouse capacity will also position
the Company for future growth and improvements in effi ciency.
Further information on likely developments in the operations of the company and the expected results of operations has not
been included in this report because the directors believe it would be likely to result in unreasonable prejudice to
the company.
8. Directors
The following persons were directors of Dicker Data Limited during the whole of the fi nancial year end up to the
date of this report. Directors were in offi ce for this entire period unless otherwise stated.
David J Dicker
Fiona T Brown
Mary Stojcevski
Chris Price
Michael Demetre
Dicker Data Limited | Annual Report 2012
Dicker Data Limited | Annual Report 2012
5
5
Directors’ Report
for the year ended 30 June 2012
David Dicker – CEO and Chairman
David is the co-founder of the Company and has been a director of the company since its inception. David’s
role as CEO requires focus on Dicker Data’s business strategy and decision making and under David’s strategic
guidance the Company has enjoyed material growth, establishing Dicker Data as one of the leading Australia-based
distributors of IT products.
Interest in Equities
Interest in Contracts
Special Responsibilities
63,750,000 shares in Dicker Data Limited
Nil
Chairman and responsible for the overall business management
as chief executive offi cer.
Other Current Listed Company Directorships None
Other Current Listed Company
Directorships Held in Previous 3 Years
None
Fiona Brown – Non-Executive Director
Fiona Brown is the co-founder of Dicker Data and currently serves as Non-Executive Director of the Company.
Fiona has been involved with the business since it started in 1978 and has been a director of the Company since
1983. Fiona acted as General Manager and Marketing Manager of Dicker Data from the inception of the business
until 2004 when she left her executive position. Fiona’s business development, negotiation, management and
leadership skills were of material importance to the success and growth of Dicker Data. As a Non-Executive Director,
Fiona brings her knowledge of the business and 25 years of experience in the IT distribution industry.
Interest in Equities
56,250,000 shares in Dicker Data Limited
Interest in Contracts
Nil
Special Responsibilities
None
Other Current Listed Company Directorships None
Other Current Listed Company
Directorships Held in Previous 3 Years
None
Mary Stojcevski – Chief Financial Offi cer
Mary joined Dicker Data as Financial Controller in 1999. Her responsibilities include all of the fi nancial management,
administration and compliance functions of the Company. Prior to joining Dicker Data Mary had over 15 years’
experience in accounting and taxation. Mary holds a Bachelor of Commerce Degree with a major in Accounting
from the University of New South Wales. Mary is also an Executive Director of the Company and has been a
director since 31 August 2010.
Interest in Equities
Interest in Contracts
Special Responsibilities
10,000 shares in Dicker Data Limited
Nil
Responsible for the overall fi nancial management of
the Company.
Other Current Listed Company Directorships None
Other Current Listed Company
Directorships Held in Previous 3 Years
None
Chris Price – Commercial Director
Chris joined Dicker Data as Sales Manager in 2006. His sales experience and IT industry knowledge have been
instrumental in the Company’s growth over recent years. Dicker Data’s revenues have grown materially since Chris
has been heading the Company’s sales team. Chris brings over 14 years of IT industry experience to the Company.
6
Dicker Data Limited | Annual Report 2012
Directors’ Report
for the year ended 30 June 2012
Prior to joining Dicker Data, Chris worked in various positions with distributors Ingram Micro and Tech Pacifi c as well
as with vendors Dell and IBM. Chris holds a Bachelor of Commerce Degree from the University of Newcastle. Chris
is also an Executive Director of the Company and has been a director since 21st September 2010.
Interest in Equities
Interest in Contracts
Special Responsibilities
Other Current Listed Company Directorships None
Other Current Listed Company
Directorships Held in Previous 3 Years
None
15,500 shares in Dicker Data Limited
Nil
Responsible for the sales operations of the Company.
Michael Demetre – Logistics Director
Michael joined Dicker Data in 2001 as a Systems and Web Maintenance Administrator. He later took up the position
of Warehouse Storeman which he held for about 5 years. Michael’s experience in the operations of the warehouse,
general knowledge of the Company and established relationships with other employees allowed him to undertake
the position of Logistics Director. He has successfully held this position since 2007. Michael is also an Executive
Director of the Company and has been a director since 21st September 2010.
Interest in Equities
Interest in Contracts
Special Responsibilities
10,000 shares in Dicker Data Limited
Nil
Responsible for the warehouse and logistic operations of
the Company.
Other Current Listed Company Directorships None
Other Current Listed Company
Directorships Held in Previous 3 Years
None
9. Company secretary
Mrs Leanne Ralph B.Bus, ACIS, AAICD was appointed to the position of Company Secretary on the 8th of February
2011. Leanne has over 21 years’ experience as a Chief Financial Offi cer and Company Secretarial roles for various
publicly listed and unlisted entities.
Leanne is a qualifi ed Chartered Secretary and Director of Boardworx Australia Pty Ltd which provides bespoke
outsourced Company Secretarial services to companies.
10. Director meetings
The numbers of meetings of the Company’s Board of directors and of each Board committee held during the year
and the number of meetings attended by each director were:
Board Meetings
David Dicker
Fiona Brown
Mary Stojcevski
Chris Price
Michael Demetre
Leanne Ralph (Secretary)
Number Eligible to Attend
Number Attended
7
7
7
7
7
7
7
7
7
7
6
7
Dicker Data Limited | Annual Report 2012
7
Directors’ Report
for the year ended 30 June 2012
11. Remuneration report
All information in this remuneration report has been audited as required by section 308(3C) of the Corporations Act
2001. The remuneration report is set out under the following main headings:
A Principles used to determine the nature and amount of remuneration
B Details of remuneration
C Service agreements
D Share-based compensation
E Additional information
(A) Principles used to determine the nature and amount of remuneration
The board addresses remuneration policies and practices generally, and determines remuneration packages and other
terms of employment for senior executives. Executive remuneration and other terms of employment are reviewed
annually by the board having regard to performance against goals set at the start of the year and relevant comparative
information. Remuneration packages are set at levels that are intended to attract and retain executives capable of
managing the company’s operations, achieving the company’s strategic objectives, and increasing shareholder wealth.
Executives
The executive pay and reward framework includes the following components:
- Base pay and benefi ts
- Performance-related bonuses
- Other remuneration such as superannuation.
The combination of these comprises the executive’s remuneration.
Base pay
Base pay is structured as a total employment cost package which may be delivered as a combination of cash and
prescribed non-fi nancial benefi ts at the executive’s discretion. There are no guaranteed base pay increases included
in any senior executives’ contracts.
Performance-related bonuses
Performance-related cash bonus entitlements are linked to the achievement of fi nancial and non-fi nancial
objectives which are relevant to meeting the company’s business objectives. A major part of the bonus entitlement
is determined by the actual performance against net profi t margin targets. Using a profi t target ensures variable
reward is only available when value has been created for shareholders and when profi t is consistent with the
business plan.
The executives’ cash bonus entitlements are assessed and paid monthly based on the actual performance against
the relevant monthly profi t with reconciliation at the end of the fi nancial year against full-year actual profi t. The
chairman and CEO is responsible for assessing whether an individual’s targets have been met
Non-executive directors
Fees and payments to non-executive directors refl ect the demands which are made on, and the responsibilities
of, the directors. The board determines remuneration of non-executive directors within the maximum amount
approved by the shareholders from time to time. This maximum currently stands at $250,000 per annum in total for
salary and fees, to be divided among the non-executive directors in such a proportion and manner as they agree.
The Board does not currently have any independent directors. The only current non-executive director is Fiona
Brown, who represents a major shareholder. No director fees have been received by Fiona Brown
(B) Details of remuneration
Compensation paid to key management personnel is set out below. Key management personnel include
all directors of the company and executives who, in the opinion of the board and CEO, have authority and
responsibility for planning, directing and controlling the activities of the group directly or indirectly. The following
also includes the four most highly remunerated executives of the company.
8
Dicker Data Limited | Annual Report 2012
Directors’ Report
for the year ended 30 June 2012
Details of Remuneration for Directors and Key Management Personnel
Short-Term
Long-Term
Share Based Payments
Cash
Short term
Incentive
Cash Bonus
Super-
annuation
Non-Cash
Long
Service
Shares Options
Total
FY
Salary
& Fees
FBT
Reportable
Leave
Proportion of
remuneration
that is
performance
based
% of Value of
remuneration
that consists
of share
Based
Payments
$
$
$
$
$
$
$
$
$
%
Executive Directors
David Dicker – Chief Executive Offi cer
2012
2011
Chris Price - Commercial Director
2012
2011
701,385
63,125
12,313
556,164
50,055
11,955
Mary Stojcevski - Chief Financial Offi cer
2012
200,000
123,410
29,107
2011
191,003
89,822
25,274
Michael Demetre - Logistics Director
2012
200,000
123,410
29,107
2011
184,505
89,822
24,689
Fiona Brown - Non-Executive Director
2012
2011
Other Key Management Personnel
Vladimir Mitnovetski - Category Manager
-
393,022
35,372
95,673
235,416
29,798
2012
2011
Total
-
-
776,823
100.00%
618,174
100.00%
352,517
35.01%
306,099
29.34%
352,517
35.01%
299,017
30.04%
-
-
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
428,394
100.00%
360,887
65.23%
0.00%
0.00%
2012
400,000 1,341,227 156,710
12,313
2011
471,181
971,224
129,816
11,955
0
0
0
0
0
0
1,910,250
1,584,177
(C) Service agreements
Terms of employment for the executive directors and other key management personnel are by way of
Consultancy Agreement or an Executive Service Agreement (ESA). The contract details the base salary and
performance-related bonuses.
Consultancy Agreement for David Dicker
The Company has engaged Rodin FZC (a company incorporated in Dubai) to provide the services of David
Dicker to act as the Chief Executive Offi cer and Executive Director of the Company on an as-needed basis.
The Consultancy Agreement is dated 26 October 2010. The engagement is for an indefi nite term. Either party
may terminate the agreement on the provision of 6 months’ notice. No fee is payable by the Company to Rodin
FZC for the provision of the services. The agreement contains a number of post-termination restraints.
Dicker Data Limited | Annual Report 2012
9
Directors’ Report
for the year ended 30 June 2012
Deed of Adherence for David Dicker
The Company and David Dicker have entered into a Deed of Adherence whereby Mr Dicker has agreed to adhere
and comply with all covenants and obligations of Rodin FZC (a company incorporated in Dubai) set out in the
Consultancy Agreement (between the Company and Rodin FZC) to the maximum allowable extent permitted by
law as if Mr Dicker was named as Rodin FZC therein. The Deed is dated 26 October 2010.
Executive Service Agreement for Chris Price
The Company has appointed Chris Price as Commercial Director and Director of the Board of the Company by
way of an Executive Service Agreement (ESA). The ESA is dated 25 October 2010. The ESA confi rms Mr Price’s
continuous service with the Company for all purposes commenced from 21 September 2010. The appointment of
Mr Price is for an unspecifi ed time. Either the Company or Mr Price may terminate the ESA with 3 months’ notice.
The remuneration payable to Mr Price is equal to 6.75% of the Company’s net profi t per month, subject to net
profi t margin before tax not being less than 2.5%, less his total motor vehicle expenses for that month. Mr Price is
also entitled to a company car (with expenses to be deducted from his remuneration) and a mobile telephone and
laptop, of which all business related telephone calls and service plan fees are paid for by the Company. The ESA
also contains a number of post-termination restraints.
Executive Service Agreement for Mary Stojcevski
The Company has appointed Mary Stojcevski as Chief Financial Offi cer and Director of the Board of the Company
by way of an Executive Service Agreement (ESA). The ESA is dated 25 October 2010. The ESA confi rms Ms
Stojcevski’s continuous service with the Company for all purposes commenced from 31 August 2010. The
appointment of Ms Stojcevski is for an unspecifi ed time. Either the Company or Ms Stojcevski may terminate
the ESA with 3 months’ notice. The remuneration payable to Ms Stojcevski comprises of a base remuneration of
$218,000 per annum (inclusive of mandatory employer superannuation contributions). Ms Stojcevski is also entitled
to a performance bonus equal to 1% of the Company’s net profi t before tax, subject to net profi t margin before tax
not being less than 2.5%. The ESA also contains a number of post-termination restraints.
Executive Service Agreement for Michael Demetre
The Company has appointed Michael Demetre as Logistics Director and Director of the Board of the Company by
way of an Executive Service Agreement (ESA). The ESA is dated 25 October 2010. The ESA confi rms Mr Demetre’s
continuous service with the Company for all purposes commenced from 21 September 2010. The appointment of
Mr Demetre is for an unspecifi ed time. Either the Company or Mr Demetre may terminate the ESA with 3 months’
notice. The remuneration payable to Mr Demetre comprises a remuneration package of $218,000 per annum
(inclusive of mandatory employer superannuation contributions). Mr Demetre is also entitled to a performance
bonus equal to 1% of the Company’s net profi t before tax, subject to net profi t margin before tax not being less
than 2.5%. The ESA also contains a number of post-termination restraints.
Executive Service Agreement for Vladimir Mitnovetski
The Company has appointed Vladimir Mitnovetski as Category Manager by way of an Executive Service Agreement
(ESA). The ESA is dated 1 January 2011. The appointment of Mr Mitnovetski is for an unspecifi ed time. Either
the Company or Mr Mitnovetski may terminate the ESA with 3 months’ notice. The remuneration payable to Mr
Mitnovetski is $22,750 per month, subject to achieving monthly net profi t target for the Business Unit of $250,000
per month and a net profi t margin of 2.5%. The company will pay a further 15% of net profi t that is above the
monthly target of $250,000 per month. The ESA also contains a number of post-termination restraints.
(D) Share-based compensation
No shares, rights, or options were granted to directors or key management personnel during the year ended 30
June 2012, no rights or options vested or lapsed during the year, and no rights or options were exercised during
the year by directors.
10 Dicker Data Limited | Annual Report 2012
Directors’ Report
for the year ended 30 June 2012
(E) Additional information
Relationship between remuneration and company performance
The overall level of executive reward takes into account the performance over the fi nancial year with greater
emphasis given to improving performance over the prior year. Compared to previous period, net profi t before tax
has grown by 39.6%, as a result the average executive remuneration has increased. Since 2007, the net profi t before
tax has grown at an average rate of 24% per annum, whilst the average executive remuneration has increased by
an average of 27% per annum. Shareholder wealth has also increased at an average rate of 21% per annum over
this period.
This concludes the remuneration report which has been audited.
12. Shares options
On the 9th of August, 2011 Newport Capital Group Pty Ltd exercised all the options held at the strike price of
$0.20c per share. The company has received the payment for the options and has issued the shares to Newport
Capital Group Pty Ltd
In the 2011 fi nancial year options were granted to Stonebridge Securities Ltd and related parties. The options
granted were to acquire 1,200,000 fully paid ordinary shares, exercisable at $0.25 anytime within 36 months from
the date of granting, expiring on 24 January, 2014. These options have not been exercised.
13. Indemnifi cation and insurance of directors and offi cers
During the fi nancial year, Dicker Data Limited paid a premium of $22,145 to insure the directors and members of
the executive management team of the Company against any liability incurred by them in their capacity as offi cers,
unless the liability arises out of conduct involving a lack of good faith.
The executive offi cers of the Company are also indemnifi ed against any liability for costs and expenses incurred in
defending civil or criminal proceedings involving them as such offi cers if judgement is given in their favour or if they
are acquitted or granted relief.
14. Indemnity and insurance of auditor
The company has not, during or since the fi nancial year, indemnifi ed or agreed to indemnify the auditor of the
company or any related entity against a liability incurred by the auditor.
During the fi nancial year, the company has not paid a premium in respect of a contract to insure the auditor of the
company or any related entity.
15. 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.
16. Environmental regulation and performance
The company is not subject to any particular and signifi cant environmental regulations.
Dicker Data Limited | Annual Report 2012
11
Directors’ Report
for the year ended 30 June 2012
17. Rounding
The company is of a kind referred to in Class Order 98/100, issued by the Australian Securities and Investments
Commission, relating to ‘rounding-off’. Amounts in this report have been rounded off in accordance with that Class
Order to the nearest thousand dollars, or in certain cases, the nearest dollar.
18. Offi cers of the company who are former audit partners of
BDO Chartered Accountants
There are no offi cers of the Company who are former audit partners of BDO Chartered Accountants.
19. Auditor independence and non-audit services
BDO Chartered Accountants (formerly PKF Chartered Accountants) continue in offi ce in accordance with section
327 of the Corporations Act 2001. During the year an amount of $79,465 in fees was paid or payable to the auditor
for non-audit services.
Non-audit services
The company employs BDO Chartered Accountants (formerly PKF Chartered Accountants) in addition to its
statutory duties where the auditor’s expertise and experience with the company are important.
The board of directors has considered the position and is satisfi ed 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 satisfi ed that the provision of non-audit services by the auditor (refer above) 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 of directors to ensure they do not impact the
impartiality and objectivity of the auditor
- none of the services undermine the general principles relating to auditor independence as set out in
APES 110 Code of Ethics for Professional Accountants.
A copy of the auditors’ independence declaration as required under section 307C of the Corporations Act 2001 is
set out on page 47.
This report is made in accordance with a resolution of the directors.
David Dicker
CEO and Chairman
Sydney, 31 August 2012
12 Dicker Data Limited | Annual Report 2012
Corporate Governance Statement
for the year ended 30 June 2012
Unless disclosed below, all the best practice
recommendations of the ASX Corporate Governance
Council have been applied by Dicker Data Limited
(Dicker Data or Company).
Principal 1: Lay Solid Foundations for
Management and Oversight
Recommendation 1.1:
Companies should establish the functions reserved to
the Board and those delegated to senior executives
and disclose those functions.
The Board is accountable to shareholders for the
performance of Dicker Data and has overall responsibility
for its direction and management and the formulation of
policies to be applied in Dicker Data’s business.
The Board has adopted a Charter which outlines
the responsibilities reserved for the Board in detail.
This Charter is published on Dicker Data’s website
ww.dickerdata.com.au.
Some key responsibilities of the Board are as follows:
(a) appoint and review the performance of the
Chairman and management;
(b) develop and approve strategy, planning and
major capital expenditure;
(c) arrange for effective budgeting and
fi nancial supervision;
(d) ensure that appropriate audit arrangements
are in place;
(e) ensure that effective and appropriate reporting
systems in place will, in particular, assure the Board
that proper fi nancial, operational, compliance and
risk management controls function adequately; and
(f ) report to shareholders.
The Board is also responsible to shareholders for Dicker
Data’s strategic direction and the execution of Dicker
Data’s overall objective, which is to increase long-term
shareholder value.
Decisions which are not part of the day to day
management of Dicker Data or which have not been
delegated to the Chief Executive Offi cer or executive
team, must be made by the Board.
Recommendation 1.2:
Companies should disclose the process for evaluating
the performance of senior executives.
The Board is responsible for reviewing the performance
of the Chief Executive Offi cer and also monitoring the
performance of key management personnel.
The performance of the Chief Executive Offi cer
is measured by comparing actual performance
against planned performance in terms of the
budget, the Company’s share price and Corporate
strategy development.
The Chief Executive Offi cer is responsible for assessing
the performance of the key executives within Dicker
Data. The basis of evaluation of senior executives is
on agreed performance measures, examining the
effectiveness and quality of the individual, assessing
key contributions, identifying areas of potential
improvement and assessing whether various
expectations of shareholders have been met.
Performance evaluations are undertaken annually, in
September, by managers.
This policy is reviewed annually.
Principal 2: Structure the Board to
Add Value
Recommendation 2.1:
A majority of the board should be independent directors.
As at the reporting date, the Board is composed
of the following fi ve Directors, including one
non-executive Director:
Name
David Dicker
Position
Chairman and
Chief Executive Offi cer
Fiona Brown
Non-Executive Director
Mary Stojcevski
Executive Director
Chris Price
Michael Demetre
Executive Director
Executive Director
When considering independence, Dicker Data
considered the following recommendation made by
the ASX Corporate Governance Council:
‘When determining the independent status of a director
the board should consider whether the director:
1. is a substantial shareholder of the company or an
offi cer of, or otherwise associated directly with, a
substantial shareholder of the company;
2. is employed, or has previously been employed in
an executive capacity by the company or another
group member, and there has not been a period
of at least three years between ceasing such
employment and serving on the board;
Dicker Data Limited | Annual Report 2012
13
Corporate Governance Statement
for the year ended 30 June 2012
3. has within the last three years been a principal
of a material professional adviser or a material
consultant to the company or another group
member, or an employee materially associated with
the service provided;
4. is a material supplier or customer of the company
or other group member, or an offi cer of or
otherwise associated directly or indirectly with a
material supplier or customer; or
5. has a material contractual relationship with the
company or another group member other than as
a director.’
The Chief Executive Offi cer is a substantial shareholder
of Dicker Data and has been engaged by Dicker Data
on a consultancy basis. He is not considered to
be independent.
Three of the Directors are employed by Dicker Data
and are not considered to be independent.
Fiona Brown, the non-executive Director, is a
substantial shareholder of Dicker Data and is not
considered to be independent.
As such, there are currently no independent Directors
on the Board. The Board considers that its composition
is appropriate to Dicker Data’s size and operational
structure, the directors’ experience and their collective
knowledge of Dicker Data’s assets. Details on the skills,
experience and expertise of each director in offi ce are
outlined on page 7 of the Annual Report.
Should the Directors determine to expand the Board
by the appointment of one or more non- executive
Directors, such non-executive Directors will be selected
on the basis of their capacity to add value to the
business, and to provide independent governance
to the operations of Dicker Data. At this stage, the
Board has made no offers to any person to join the
Board. Expansion of the Board is subject to various
contingencies including some over which the Board has
no control, including but not limited to the availability
of suitably qualifi ed and experienced individuals with a
desire to join the Board.
The Board has chosen not to undertake an annual
review of its performance and composition during the
year ended 30 June 2012. This is due to the fact that the
Board has only been existence since listing on the ASX in
January 2011 and the operations of the business do not
require additional skillsets at this point in time to drive
the business and shareholder returns. As the business
evolves, the Board expects to conduct a review of its
performance and composition, to ensure that it has the
appropriate mix of expertise and experience, taking into
account the size and nature of Dicker Data’s activities.
In time, the Board may consider the appointment of
independent directors as it deems appropriate.
Directors may obtain independent professional advice
at the Company’s expense, subject to prior approval
by the Chairman, on matters arising in the course of
Dicker Data’s business. Directors also have unrestricted
access to any employees of Dicker Data and, subject
to the law, access to all Dicker Data records and
information held by employees and external advisers.
Recommendation 2.2:
The chairperson should be an independent director.
The current Chairman of the Board is not an
independent Director. The Board considers this to be
appropriate to Dicker Data’s size, structure, history of
the business and the nature of its activities.
Recommendation 2.3:
The roles of chairperson and chief executive offi cer
should not be exercised by the same individual.
The roles of Chairman and Chief Executive Offi cer are
currently being carried out by the same individual.
The Board considers this to be appropriate for the
Company’s current operational structure and the
nature of its activities.
Recommendation 2.4:
The board should establish a nomination committee.
The Board does not currently have a nomination
committee. The Board considers that its relatively small
size and the expertise of its directors allow the full
Board to perform a nomination committee function.
Accordingly, the Board does not consider it necessary
or appropriate in the context to establish a separate
committee for this purpose.
Recommendations of candidates for new Directors are
to be made to and by the Board. The Board as a whole
must make such appointments as it considers the most
appropriate for Dicker Data.
The Board believes that the requirements and
nomination processes are currently appropriate for
the Company. The Board will establish a nomination
committee in the future should the requirement arise.
14 Dicker Data Limited | Annual Report 2012
Corporate Governance Statement
for the year ended 30 June 2012
Recommendation 2.5:
Companies should disclose the process for evaluating
the performance of the board, its committees and
individual directors.
The Board does not currently undertake an assessment
of individual performance of Directors in the Board
context, or of the Board as a whole. For the reasons
outlined above, the Board is of the view that it is
currently of the appropriate size and composition
required to carry out its role.
There are currently no committees of the Board which
require a review.
The Board acknowledges the benefi t of establishing
a process to review and evaluate the performance of
individual Directors and the Board as a whole, and due
consideration will be given to this in the next 12 months.
It is anticipated that such an annual review will include
consideration of the following measures:
(a) assessment of the performance of the Board over
the previous twelve months having regard to the
corporate strategies, operating plans and the
annual budget;
(b) review the Board’s interaction with management;
(c) identifi cation of any particular goals and objectives
of the Board for the next year;
(d) review the type and timing of information provided
to the Directors; and
(e) identifi cation of any necessary or desirable
improvements to Board.
The method and scope of the performance evaluation
will be set by the Board and may include a Board self-
assessment checklist to be completed by each Director.
The Board may also use an independent adviser to
assist in the review.
Committees
Similar procedures to those for the Board review will
be applied to evaluate the performance of any Board
committees established by Dicker Data in the future.
An assessment will be made of the performance
of each committee against each charter and areas
identifi ed where improvements can be made.
Non-executive Directors
The Chairman will have primary responsibility for
conducting performance appraisals of non-executive
Directors in conjunction with them, having particular
regard to:
(a) contribution to Board discussion and function;
(b) degree of independence including any confl icts
of interest;
(c) availability for and attendance at Board meetings
and other relevant events;
(d) contribution to Company strategy;
(e) membership of and contribution to any Board
committees; and
(f ) suitability to Board structure and composition.
Where the Chairman, following a performance
appraisal, considers that action must be taken in
relation to a Director’s performance, the Chairman
will consult with the remainder of the Board regarding
whether a Director should be counselled to resign,
not seek re-election, or in exceptional circumstances,
whether a resolution for the removal of a Director be
put to shareholders.
Principal 3: Promote ethical and
responsible decision making
Recommendation 3.1:
Companies should establish a code of conduct and
disclose the code or a summary of the code as to:
•
•
•
The practices necessary to maintain confi dence in
the company’s integrity
The practices necessary to take into account their
legal obligations and the reasonable expectations of
their stakeholders
The responsibility and accountability of individuals
for reporting and investigating reports of unethical
practices.
Dicker Data has two codes of conduct – one specifi cally
for directors and key offi cers and another outlining the
obligation to stakeholders.
Generally, Dicker Data requires that its Directors,
management and staff comply with and respect the
law, conduct themselves professionally and commit to
the standards of employment set down by Dicker Data.
Dicker Data also requires that all potential confl icts of
interest are reported and that it’s Code of Conduct for
Dicker Data’s obligations to Stakeholders and Code of
Conduct for directors and key offi cers be otherwise
complied with.
Dicker Data Limited | Annual Report 2012
15
Corporate Governance Statement
for the year ended 30 June 2012
Recommendation 3.2:
Companies should establish a policy concerning
diversity and disclose the policy or a summary of
that policy. The policy should include requirements
for the board to establish measurable objectives
for achieving gender diversity and for the board to
assess annually both the objectives and progress in
achieving them.
The company has not adopted a formal Diversity Policy
at this stage. The Board will consider how appropriate
such a policy is for the Company in due course.
Currently, the Board does not consider a formal policy
to be warranted as the Company is one which has an
open policy to diversity, including gender diversity. This
is evident in the number of females to males in the
whole organization, at management level and also on
the Board.
Recommendation 3.3:
Companies should disclose in each annual report the
measurable objectives for achieving gender diversity
set by the board in accordance with the diversity
policy and progress towards achieving them.
The Board has not set any specifi c gender diversity
objectives for the Company as it does not yet have
a formal Diversity Policy. The Board is of the view
that there is an adequate balance between genders
across the business and the numbers disclosed below
refl ect this.
Recommendation 3.4:
Companies should disclose in each annual report
the proportion of women employees in the whole
organisation, women in senior executive positions
and women on the board.
The Company employs the following ratio of women to
men throughout the organisation:
Organisation-wide:
37 Females (40%): 56 Males (60%)
Senior Executive Positions:
The Board of Directors: 2 Females: 3 Males
Principal 4: Safeguard integrity in
fi nancial reporting
Recommendation 4.1:
The board should establish an audit committee.
The Board considers that its relatively small size and
the expertise of existing directors allows the full Board
to perform an audit committee function.
Accordingly, the Board does not consider it necessary
or appropriate in the context to establish a separate
committee for this purpose.
Rather, the Board will have processes and procedures
in place which will address the issues that would
otherwise be considered by the audit committee
including:
•
•
monitoring the independence of the external auditor
who is required to confi rm such independence on
at least a semi-annual basis; and
monitoring and the performance and terms of the
audit engagement on an annual basis and updating,
changing or replacing them as appropriate.
The Board will review the audit requirements and
processes of Dicker Data at least on an annual basis,
and otherwise as Dicker Data’s operations evolve,
to ensure that its audit requirements are being
appropriately handled. The Board will establish an
Audit Committee in the future as it deems appropriate.
Recommendation 4.2:
Structure the audit committee so that it consists of:
- only non-executive directors
- a majority of independent directors
-
an independent chairperson, who is not
chairperson of the board
- at least three members
For the reasons noted above and due to the relative
size and nature of Dicker Data’s activities, the Board
does not consider it necessary or appropriate to
adopt Recommendation 4.2. However, should an
Audit Committee be established in the future, it will
be structured to be commercially cost effective and
appropriate to Dicker Data’s size and structure, having
regard to Recommendation 4.2.
Recommendation 4.3:
The audit committee should have a formal charter.
For the reasons noted above and due to the relative
size and nature of Dicker Data’s activities, the Board
does not consider it necessary or appropriate to adopt
Recommendation 4.3. However, should an Audit
Committee be established in the future, a formal Audit
Committee Charter will be adopted in compliance with
Recommendation 4.3.
16 Dicker Data Limited | Annual Report 2012
Corporate Governance Statement
for the year ended 30 June 2012
Principal 5: Make timely and
balanced disclosure
Recommendation 5.1:
Companies should establish written policies designed
to ensure compliance with ASX Listing Rule disclosure
requirements and to ensure accountability at a senior
management level for that compliance and disclose
those policies or a summary of those policies.
The Board aims to ensure that the market is properly
informed of all the information that is required to
be disclosed under the Listing Rules of the ASX. The
ultimate determination as to whether or not to disclose
in doubtful cases may be made by the Board and/or
the Chairman, taking into account the overall situation
of Dicker Data and, if necessary, legal or other advice.
The Board will consider establishing a Continuous
Disclosure Compliance Committee to deal with
continuous disclosure issues when and if it is deemed
necessary. In this event, the Continuous Disclosure
Compliance Committee will consist of the Chairman,
the Company Secretary and, where available, any
other Director.
Dicker Data has adopted a formal Continuous
Disclosure Policy which is available on the company
website on www.dickerdata.com.au.
Under the Board’s Continuous Disclosure Policy, all
senior personnel must ensure that all reporting staff
report any material event or development within their
area of responsibility to their manager and to one or
more of the Chairman and the Company Secretary.
The Company Secretary is the point of contact with the
ASX. As a listed company, Dicker Data will not release
information that is for release to the market to any
person until it has given the information to the ASX
and has received an acknowledgement from the ASX
that the information has been released to the market.
Principal 6: Respect the Rights
of Shareholders
Recommendation 6.1:
Companies should design a communications
policy for promoting effective communication with
shareholders and encouraging their participation
at general meetings and disclose their policy or a
summary of that policy.
Dicker Data aims to convey to its shareholders
pertinent information in a detailed, regular, factual and
timely manner.
The Board has ensured that the annual report includes
relevant information about the operations of Dicker
Data during the year, and changes in the state of affairs
of Dicker Data, in addition to the other disclosures
required by the Corporations Act.
Information will be communicated to shareholders by
Dicker Data through:
1. Placement of market announcements on Dicker
Data’s web-site www.dickerdata.com.au after the
information has been given to the ASX and the
usual acknowledgement has been received;
2. The annual and interim fi nancial reports;
3. Disclosures to the ASX;
4. Notices and explanatory memoranda of annual
general meetings; and
5. All shareholders are invited to attend and raise
questions at the annual general meeting.
All shareholders are welcome to communicate directly
with Dicker Data.
All queries will be answered to the maximum extent
possible (with consideration given to commercially
sensitive information, privacy requirements and Dicker
Data’s disclosure obligations) and in a timely fashion.
Dicker Data has not established any other formal policy
document other than as noted above.
Principle 7: Recognise and Manage Risk
Recommendation 7.1:
Companies should establish policies for the oversight
and management and management of material
business risks and disclose a summary of those policies.
Although no formal policy has been adopted,
the Board is committed to ensuring that the risks
associated with Dicker Data’s business activities are
properly identifi ed, monitored and managed and to
embedding in its management and reporting systems
a number of risk management controls.
The Board is to monitor and receive advice on areas of
operational and fi nancial risk, and consider strategies
for appropriate risk management arrangements.
Specifi c areas of risk to be regularly considered at
Board meetings are to include intellectual property,
changes in government regulation, technology
changes, human resources, integrity of data, statutory
compliance and continuous disclosure obligations.
Dicker Data Limited | Annual Report 2012
17
Corporate Governance Statement
for the year ended 30 June 2012
Recommendation 7.2:
The board should require management to design and
implement the risk management and internal control
system to manage the company’s material business
risks and report to it on whether those risks are being
managed effectively. The board should disclose that
management has reported to it as to the effectiveness
of the company’s management of its material
business risks.
The fi nancial statements and notes thereto give a true
and fair view, in all material respects, of the fi nancial
position and performance of the company as required
by Section 297 of the Corporations Act 2001; and
Any other matters are prescribed by the regulations
in relation to the fi nancial statements and the
accompanying notes are satisfi ed.
The Chief Executive Offi cer manages Dicker Data’s
material business risks and reports to the Board.
Principle 8: Remunerate Fairly
and Responsibly
Materiality thresholds
Dicker Data regularly reviews procedures, and ensures
timely identifi cation of material information and
materiality thresholds.
Materiality judgments can only be made on a case
by case basis, when all the facts are available. In
accordance with Accounting Standard AASB 1031, the
Board would consider an amount which is:
(a) equal or more than 10% of an appropriate base
amount to be material unless there is evidence or
convincing argument to the contrary; and
(b) equal to or less than 5% of an appropriate base
amount to be immaterial unless there is evidence or
convincing argument to the contrary.
The level between 5% and 10% of an appropriate base
amount is considered to be a subjective area to be
resolved by the Board.
Recommendation 7.3:
The board should disclose whether it has received
assurance from the chief executive offi cer (or equivalent)
and the chief fi nancial offi cer (or equivalent) that the
declaration provided in accordance with section 295A
of the Corporations Act is founded on a sound system
of risk management and internal control and that the
system is operating effectively in all material respects in
relation to fi nancial reporting risks.
Recommendation 8.1:
The board should establish a remuneration committee.
The Board considers that its relatively small size and
the expertise of directors allows the full Board to
also perform a remuneration committee function.
Accordingly, the Board does not consider it necessary
or appropriate in the context to establish a separate
committee for this purpose. Rather, the Board will have
processes and procedures in place which will address
the issues that would otherwise be considered by the
remuneration committee including ensuring that fees
and remuneration to director’s accord with principles
set out in 8.2 below.
Recommendation 8.2:
The remuneration committee should be structured so
that it:
- consists of a majority of independent directors
-
- has at least three members
is chaired by an independent chair
The Board will establish a remuneration committee in
the future if it deems appropriate.
Recommendation 8.3:
Companies should clearly distinguish the structure of
non-executive directors’ remuneration from that of
executive directors and senior executives.
The Board confi rms that the Chief Executive Offi cer and
the Chief Financial Offi cer have made the following
certifi cations to the Board:
With respect to non-executive Directors, the Board
(or if established, the Remuneration Committee) is to
ensure that:
The fi nancial records of the company have been
properly maintained in accordance with Section 286 of
the Corporations Act 2001;
The fi nancial statements and notes thereto comply
with the relevant accounting standards in all
material respects as required by Section 296 of the
Corporations Act 2001;
(a) fees paid to non-executive Directors are within the
aggregate amount approved by shareholders and
make recommendations to the Board with respect to
the need for increases to that aggregate amount at
the Annual General Meeting;
(b) non-executive Directors are remunerated by
way of fees (in the form of cash and/or
superannuation benefi ts);
18 Dicker Data Limited | Annual Report 2012
Corporate Governance Statement
for the year ended 30 June 2012
(c) non-executive Directors are not provided
with retirement benefi ts other than statutory
superannuation entitlements; and
(d) non-executive Directors are not entitled to
participate in equity-based remuneration schemes
designed for executives without due consideration
and appropriate disclosure to Dicker Data’s
shareholders.
There is currently only one non-executive director on
the Board of Dicker Data, Fiona Brown and she does
not receive any remuneration for her role.
With respect to executives, the Board (or if established,
the Remuneration Committee) is to ensure that:
(a) executive remuneration packages involve a balance
between fi xed and incentive pay, refl ecting short and
long term performance objectives appropriate to
Dicker Data’s circumstances and objectives;
(b) a portion of executives’ remuneration is structured in
a manner designed to link reward to corporate and
individual performances; and
(c) recommendations are made to the Board with respect
to quantum of bonuses to be paid to executives.
Dicker Data Limited | Annual Report 2012
19
Statement of Comprehensive Income
for the year ended 30 June 2012
Revenue
Changes in inventories
Consumables used
Employee benefi ts expense
Depreciation and amortisation expenses
Finance costs
Insurance
Profi t / (Loss) on Asset Disposals
Bad Debts
Credit Card Fees
Consultancy Fees
IPO Expenses
Other expenses
Profi t before income tax
Income tax expense
Profi t for the period
Profi t attributable to members of the company
Other comprehensive income, net of tax
Total Comprehensive Income for the period
Total comprehensive income attributable
to members of the company
Earnings per share
- basic earnings per share (cents)
- diluted earnings per share (cents)
Note
2
4
5
30-Jun-12
$’000
456,648
1,223
(423,892)
(12,767)
(684)
(3,149)
(1,174)
48
(706)
(802)
(577)
-
(1,903)
12,265
(3,989)
8,276
8,276
-
8,276
8,276
6.55
6.48
30-Jun-11
$’000
385,246
15,724
(373,589)
(9,734)
(698)
(2,292)
(914)
(836)
(713)
(676)
(515)
(439)
(1,776)
8,788
(2,656)
6,132
6,132
-
6,132
6,132
5.02
5.00
The statement of comprehensive income is to be read in conjunction with the attached notes.
20 Dicker Data Limited | Annual Report 2012
Statement of Financial Position
as at 30 June 2012
Note
30-Jun-12
$’000
30-Jun-11
$’000
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Other fi nancial assets
Inventories
Total Current Assets
Non-Current Assets
Property, plant and equipment
Intangible assets
Deferred tax assets
Total Non-Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and other payables
Borrowings
Current tax liabilities
Short-term provisions
Total Current Liabilities
Non-Current Liabilities
Borrowings
Deferred tax liabilities
Long-term provisions
Total Non-Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Retained profi ts
TOTAL EQUITY
9
10
11
12
13
14
15
16
17
15
18
17
15
18
19
20
222
68,670
0
41,323
1
63,554
0
40,101
110,216
103,655
16,548
93
621
17,262
16,636
-
798
17,433
127,478
121,089
58,520
46,145
1,342
580
72,831
27,618
1,224
414
106,587
102,088
959
1,183
202
2,343
108,930
18,548
844
370
17,334
18,548
964
1,226
58
2,249
104,336
16,752
540
374
15,838
16,752
The statement of fi nancial position is to be read in conjunction with the attached notes.
Dicker Data Limited | Annual Report 2012
21
Statement of Changes In Equity
for the year ended 30 June 2012
Class ‘A’
Class ‘B’
Ordinary
Retained
Earnings
Share
Option
Reserve
Capital
profi ts
reserve
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Balance at 30 June 2010
Share capital restructure
5
(5)
5
(5)
13,811
-
369
14,191
Share Capital - IPO
Costs associated with
IPO Share Offer
Share Option Reserve
Total comprehensive income
for the year
Subtotal
Dividend Paid
Balance at 30 June 2011
Total comprehensive income
for the year
Dividend Paid
Share Issue Newport Capital
Share Option Reserve
-
10
1,000
(465)
(5)
6,132
-
-
-
-
540
19,943
(4,105)
540
15,838
8,276
(6,780)
300
4
-
1,000
(465)
-
6,132
369
20,857
(4,105)
369
16,752
8,276
(6,780)
300
-
369
18,548
5
5
5
(4)
1
Balance at 30 June 2012
-
-
844
17,334
The statement of changes in equity is to be read in conjunction with the attached notes.
22 Dicker Data Limited | Annual Report 2012
Statement of Cashfl ows
for the year ended 30 June 2012
Note
30-Jun-12
$’000
30-Jun-11
$’000
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers (inclusive of GST)
Interest received
Payments to suppliers and employees (inclusive of GST)
Interest and fi nance costs paid
Income tax paid
495,798
5
(501,911)
(3,149)
(3,738)
398,831
10
(388,785)
(2,292)
(2,764)
NET CASH FROM (USED IN) OPERATING ACTIVITIES
25(b)
(12,994)
5,000
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for property plant and equipment
Proceeds from sale of property plant and equipment
Payments for intangibles
NET CASH FROM (USED IN) INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from share issue
Share issue expenses
Proceeds/(Repayment) from borrowings
Payment of dividends
(970)
325
(93)
(738)
304
-
18,521
(4,871)
(2,241)
1,821
-
(420)
1,000
(470)
(2,718)
(2,411)
NET CASH FROM (USED IN) FINANCING ACTIVITIES
13,954
(4,600)
NET CASH FLOWS
Cash at beginning of fi nancial year
CASH AT THE END OF FINANCIAL YEAR
The statement of cashfl ows is to be read in conjunction with the attached notes.
222
1
222
(20)
21
1
Dicker Data Limited | Annual Report 2012
23
Notes to the Financial Statements
for the year ended 30 June 2012
The fi nancial statements cover Dicker Data Limited
(Dicker Data) as an individual entity. Dicker Data is a
listed public Company incorporated and domiciled
in Australia.
1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
Basis of Preparation
The fi nancial report is a general purpose fi nancial
report that has been prepared in accordance with
Australian Accounting Standards (including Australian
Accounting Interpretations) of the Australian
Accounting Standards Board and the Corporations Act
2001, as appropriate for profi t oriented entities.
Australian Accounting Standards set out accounting
policies that the AASB has concluded would result
in a fi nancial report containing relevant and reliable
information about transactions, events and conditions
to which they apply. Compliance with Australian
Accounting Standards ensures that the fi nancial
statements and notes also comply with International
Financial Reporting Standards.
Material accounting policies adopted in the preparation
of this fi nancial report are presented below. They have
been consistently applied unless otherwise stated.
The fi nancial report has been prepared on an accruals
basis and is based on historical costs modifi ed by the
revaluation of selected non-current assets, and fi nancial
assets and fi nancial liabilities for which the fair value
basis of accounting has been applied. The fi nancial
report is presented in Australian Dollars and was
authorised for issue by the directors on 31 August 2012.
(a) Income Tax
Income tax expense (revenue) for the year comprises
current income tax expense (income) and deferred tax
expense (income).
Current income tax expense charged to the profi t or
loss is the tax payable on taxable income calculated
using applicable income tax rates enacted, or
substantially enacted, as at the end of the reporting
period. Current tax liabilities (assets) are therefore
measured at the amounts expected to be paid to
(recovered from) the relevant taxation authority.
Current and deferred income tax expense (income) is
charged or credited outside profi t or loss when the tax
relates to items that are recognised outside profi t or loss.
Deferred tax assets and liabilities are ascertained based
on temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in
the fi nancial statements. Deferred tax assets also result
where amounts have been fully expensed but future
tax deductions are available. No deferred income tax
will be recognised from the initial recognition of an
asset or liability where there is no effect on accounting
or taxable profi t or loss.
Deferred income tax expense refl ects movements in
deferred tax asset and deferred tax liability balance
during the year as well as unused tax losses.
Deferred tax assets and liabilities are calculated at the
tax rates that are expected to apply to the period when
the asset is realised or the liability settled, based on tax
rates enacted or substantively enacted as at the end of
the reporting period. Their measurement also refl ects
the manner in which management expects to recover or
settle the carrying amount of the related asset or liability.
Deferred tax assets relating to temporary differences
and unused tax losses are recognised only to the
extent that it is probable that future taxable profi t will
be available against which the benefi ts of the deferred
tax asset can be utilised.
Where temporary differences exist in relation to
investments in subsidiaries, branches, associates, and
joint ventures, deferred tax assets and liabilities are
not recognised where the timing of the reversal of
the temporary difference can be controlled and it is
not probable that the reversal will occur in the
foreseeable future.
Current tax assets and liabilities are offset where a legally
enforceable right of set-off exists and it is intended that
net settlement or simultaneous realisation and settlement
of the respective asset and liability will occur. Deferred tax
assets and liabilities are offset where a legally enforceable
right of set-off exists, the deferred tax assets and liabilities
relate to income taxes levied by the same taxation
authority on either the same taxable entity or different
taxable entities where it is intended that net settlement or
simultaneous realisation and settlement of the respective
asset and liability will occur in future periods in which
signifi cant amounts of deferred tax assets or liabilities are
expected to be recovered or settled.
(b) Cash and Cash Equivalents
Cash and cash equivalents include cash on hand,
deposits held at call with banks, other short-term highly
liquid investments with original maturities of three
months or less.
24 Dicker Data Limited | Annual Report 2012
Notes to the Financial Statements
for the year ended 30 June 2012
(c) Trade Receivables
Trade receivables, which are non-interest bearing
and generally due for settlement within 30 days from
end of month, are recognised initially at fair value
and subsequently measured at amortised cost, less
an allowance for impairment. Collectability of trade
receivables is reviewed on an ongoing basis. Debts
that are known to be uncollectable are written off by
reducing the carrying amount directly. A provision for
impairment of trade receivables is raised when there is
objective evidence that the Company will not be able
to collect all amounts due according to original terms.
Signifi cant fi nancial diffi culties of the debtor, probability
that the debtor will enter bankruptcy or fi nancial
reorganisation and default or delinquency in payments
(more than 90 days overdue) are considered indicators
that the trade receivable may be impaired. The amount
of the impairment allowance is the difference between
the asset’s carrying amount and the present value
of the estimated future cash fl ows, discounted at the
original effective interest rate.
Other receivables are recognised at amortised cost,
less any provision for impairment.
(d) Inventories
Inventories are measured at the lower of cost and net
realisable value. Costs are assigned to individual items
of inventory on the basis of weighted average cost.
Net realisable value is the estimated selling price in the
ordinary course of business.
(e) Property, Plant and Equipment
Each class of property, plant and equipment is carried
at cost less, where applicable, any accumulated
depreciation and impairment losses.
Depreciation
The depreciable amount of all fi xed assets including
buildings and capitalised leased assets, but excluding
freehold land, are depreciated on a straight line basis over
their estimated useful lives to the entity commencing from
the time the asset is held ready for use.
The useful life in years used for each class of
depreciable asset is:
Class of Fixed Asset
Buildings
Property Improvements
Plant and equipment
Motor vehicles
Useful Life
25 years
10 – 20 years
2 - 10 years
8 years
The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate, at the end of
each reporting period. An asset’s carrying amount is
written down immediately to its recoverable amount
if the asset’s carrying amount is greater than its
estimated recoverable amount.
Gains and losses on disposals are determined by
comparing proceeds with the carrying amount. These
gains or losses are included in the income statement.
When re-valued assets are sold, amounts included
in the revaluation reserve relating to that asset are
transferred to retained earnings.
(f) Intangible Assets
Intangible assets acquired are initially recognised at
cost. Intangible assets are subsequently measured at
cost less amortisation and any impairment. The gains
and losses recognised in profi t or loss arising from
the derecognition of intangible assets are measured
as the difference between net disposal proceeds
and the carrying amount of the intangible asset. The
method and useful lives of fi nite life intangibles are
reviewed annually. Changes in the expected pattern
of consumption or useful life are accounted for
prospectively by changing the amortisation method
or period.
Website Design and Development
Signifi cant costs associated with the website design and
development are deferred and amortised on a straight
line basis over a period of its expected benefi t, being
its fi nite life of 5 years. Amortisation of the asset is to
commence when the website becomes fi rst available
for use.
(g) Leases
Leases of fi xed assets, where substantially all the risks
and benefi ts incidental to the ownership of the asset,
but not the legal ownership are transferred to the
company are classifi ed as fi nance leases. Finance leases
are capitalised by recording an asset and a liability at
the lower of the amounts equal to the fair value of the
leased property or the present value of the minimum
lease payments, including any guaranteed residual
values. Lease payments are allocated between the
reduction of the lease liability and the lease interest
expense for the period.
Leased assets are depreciated on a straight line basis
over the shorter of their estimated useful lives or the
lease term.
Dicker Data Limited | Annual Report 2012
25
Notes to the Financial Statements
for the year ended 30 June 2012
Lease payments for operating leases, where
substantially all the risks and benefi ts remain with the
lessor, are charged as expenses in the periods in which
they are incurred.
(h) Financial Instruments
Initial recognition and measurement
Financial instruments, incorporating fi nancial assets
and fi nancial liabilities, are recognised when the entity
becomes a party to the contractual provisions of the
instrument. Trade date accounting is adopted for
fi nancial assets that are delivered within timeframes
established by marketplace convention.
Financial instruments are initially measured at fair value
plus transactions costs. Where the instrument is classifi ed
‘at fair value through profi t or loss’ transactions costs are
expensed to profi t or loss immediately.
Classifi cation and subsequent measurement
Financial instruments are subsequently measured at
either, fair value, amortised cost using the effective
interest rate method or cost. Fair value represents the
amount for which an asset could be exchanged or a
liability settled, between knowledgeable, willing parties.
Where available, quoted prices in an active market are
used to determine fair value. In other circumstances,
valuation techniques are adopted.
Amortised cost is calculated as: (i) the amount at which
the fi nancial asset or fi nancial liability is measured at
initial recognition; (ii) less principal repayments; (iii) plus
or minus the cumulative amortisation of the difference,
if any, between the amount initially recognised and the
maturity amount calculated using the effective interest
method; and (iv) less any reduction of impairment.
The effective interest method is used to allocate
interest income or interest expense over the relevant
period and is equivalent to the rate that exactly
discounts estimated future cash payments or receipts
(including fees, transaction cost and other premiums
or discounts) through the expected life (or when this
cannot be reliably predicted, the contractual term) of
the fi nancial instrument to the net carrying amount
of the fi nancial asset or fi nancial liability. Revisions
to expected future net cash fl ows will necessitate an
adjustment to the carrying value with a consequential
recognition of an income or expense in profi t or loss.
(i) Financial assets at fair value through profi t or loss
Financial assets are classifi ed at ‘fair value through
profi t or loss’ when they are either held for trading for
the purpose of short term profi t taking. Such assets
are subsequently measured at fair value with changes
in carrying value being included in profi t or loss. The
company has not held any fi nancial assets at fair value
through profi t and loss in the current or comparative
fi nancial year.
(ii) Loans and receivables
Loans and receivables are non-derivative fi nancial
assets with fi xed or determinable payments that are
not quoted in an active market and are subsequently
measured at amortised cost.
Loans and receivables are included in current assets,
except for those which are not expected to mature
within 12 months after the end of the reporting period,
which will be classifi ed as non-current assets.
(iii) Held-to-maturity investments
Held-to-maturity investments are included in non-
current assets, except for those which are expected to
mature within 12 months after the end of the reporting
period, which will be classifi ed as current assets.
If during the period the company sold or reclassifi ed
more than an insignifi cant amount of the held-to-
maturity investments before maturity, the entire
category of held-to-maturity investments would be
tainted and would be reclassifi ed as available-for-sale.
(iv) Available-for-sale fi nancial assets
Available-for-sale fi nancial assets are included in non-
current assets, except for those which are expected to
be disposed of within 12 months after the end of the
reporting period, which will be classifi ed as current assets.
(v) Financial liabilities
Non-derivative fi nancial liabilities (excluding fi nancial
guarantees) are subsequently measured at amortised cost.
Fair value
Fair value is determined based on current bid prices for
all quoted investments. Valuation techniques are applied
to determine the fair value for all unlisted securities,
including recent arm’s length transactions, reference to
similar instruments and option pricing models.
Impairment
At the end of each reporting period, the company
assesses whether there is objective evidence that a
fi nancial instrument has been impaired. In the case of
available-for-sale fi nancial instruments, a prolonged
decline in the value of the instrument is considered
to determine whether an impairment has arisen.
Impairment losses are recognised in the statement of
comprehensive income.
26 Dicker Data Limited | Annual Report 2012
Notes to the Financial Statements
for the year ended 30 June 2012
(i) Impairment of assets
At the end of each reporting period, the company
assesses whether there is any indication that an
asset may be impaired. The assessment will include
considering external sources of information and
internal sources of information including dividends
received from subsidiaries, associates or jointly
controlled entities deemed to be out of pre-acquisition
profi ts. If such an indication exists, an impairment test is
carried out on the asset by comparing the recoverable
amount of the asset, being the higher of the asset’s fair
value less costs to sell and value in use to the asset’s
carrying value. Any excess of the asset’s carrying
value over its recoverable amount is expensed to the
statement of comprehensive income.
Where it is not possible to estimate the recoverable
amount of an individual asset, the company estimates
the recoverable amount of the cash-generating unit to
which the asset belongs.
(j) Employee Benefi ts
Provision is made for the company’s liability for
employee benefi ts arising from services rendered
by employees to the end of the reporting period.
Employee benefi ts that are expected to be settled
within one year have been measured at the amounts
expected to be paid when the liability is settled.
Employee benefi ts payable later than one year have
been measured at the present value of the estimated
future cash outfl ows to be made for those benefi ts.
In determining the liability, consideration is given to
employee wage increases and the probability that
the employee may not satisfy vesting requirements.
Those cash fl ows are discounted using market yields on
national government bonds with terms to maturity that
match the expected timing of cash fl ows.
(k) Trade and other payables
These amounts represent liabilities for goods and
services provided to the Company prior to the end of
the fi nancial year and which are unpaid. Due to their
short term nature they are measured at amortised cost
and not discounted. The amounts are unsecured and
are usually paid within 30 -60 days of recognition.
(l) Provisions
Provisions are recognised when the company has a
legal or constructive obligation, as a result of past
events, for which it is probable that an outfl ow of
economic benefi ts will result and that outfl ow can be
reliably measured.
Provisions are measured using the best estimate of the
amounts required to settle the obligation at the end of
the reporting period.
(m) Revenue and Other Income
Revenue is measured at the fair value of the
consideration received or receivable.
Sale of goods revenue is recognised at the point of
sale, which is where the customer has taken delivery of
the goods, the risks and rewards are transferred to the
customer and there is a valid sales contract. Amounts
disclosed as revenue are net of sales returns.
Interest revenue is recognised as interest accrues
using the effective interest method. This is a method
of calculating the amortised cost of a fi nancial 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 fi nancial asset to the
net carrying amount of the fi nancial asset.
All revenue is stated net of the amount of goods and
services tax (GST).
Other revenue is recognised when it is received or
when the right to receive payment is established.
(n) Borrowing Costs
Borrowing costs directly attributable to the acquisition,
construction or production of assets that necessarily
take a substantial period of time to prepare for their
intended use or sale, are added to the cost of those
assets, until such time as the assets are substantially
ready for their intended use or sale. All other
borrowing costs are recognised in expenses in the
period in which they are incurred.
(o) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of
the amount of GST, except where the amount of GST
incurred is not recoverable from the Tax Offi ce. In these
circumstances the GST is recognised as part of the cost
of acquisition of the asset or as part of an item of the
expense. Receivables and payables in the statement of
fi nancial position are shown inclusive of GST.
Cash fl ows are presented in the Statement of Cash
Dicker Data Limited | Annual Report 2012
27
Notes to the Financial Statements
for the year ended 30 June 2012
Flows on a gross basis, except for the GST component
of investing and fi nancing activities, which are disclosed
as operating cash fl ows.
(p) Contributed Equity
Ordinary shares are classifi ed as equity. Incremental
costs directly attributable to the issue of shares or
options are shown in equity as a deduction, net of tax
from proceeds.
(q) Comparative Figures
When required by Accounting Standards, comparative
fi gures have been adjusted to conform to changes in
presentation for the current year.
(r) Critical Accounting Estimates
and Adjustments
The directors evaluate estimates and judgements
incorporated into the fi nancial statements based
on historical knowledge and best available current
information. Estimates assume a reasonable
expectation of future events and are based on current
trends and economic data, obtained both externally
and within the company.
The directors have identifi ed the following critical
accounting policies for which signifi cant judgements,
estimates and assumptions are made. Actual results may
differ from these estimates under different assumptions
and conditions and may materially affect the fi nancial
results or the fi nancial position in future periods.
Further details on the nature of these assumptions and
conditions are noted below:
Consumables Used
Cost of goods are represented in the Statement
of Comprehensive Income net of supplier rebates.
Supplier rebates can be paid monthly, quarterly or half
yearly. At the end of the fi nancial year an estimate of
rebates due, relating to the fi nancial year is accounted
for based on best available information at the time of
the rebate being paid.
Income tax
The company is subject to income taxes based on the
income tax laws of Australia. Signifi cant 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 company
recognises liabilities for anticipated tax expense based on
its current understanding of the tax law.
Recovery of deferred tax assets
Judgement is required in assessing whether certain
deferred tax assets and deferred tax liabilities are
recognised on the Statement of Financial Position.
Deferred tax assets including those arising from capital
losses are recognised only when it is considered more
likely than not that they will be recovered, which is
dependent on the generation of future capital profi ts.
An assumption has been made that it is unlikely that
future capital profi ts will be earned.
Estimation of useful lives of assets
The company determines the estimated useful lives
and related depreciation and amortisation charges
for its property, plant and equipment and defi nite
life intangible assets. The useful lives could change
signifi cantly 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.
Long service leave provision
The liability for long service leave is recognised and
measured at the present value of the estimated future
cash fl ows to be made in respect of all employees at
the reporting date.
Provision for impairment of receivables
The provision for impairment of receivables assessment
requires a degree of estimation and judgement. The
level of provision is assessed by taking into account
the recent sales experience, the ageing of receivables,
historical collection rates and specifi c knowledge of the
individual debtors’ fi nancial position. The impairment
for receivables has been calculated net of estimated
insurance recoveries
Provision for impairment of inventories
The provision for impairment of inventories assessment
requires a degree of estimation and judgement. The
level of the provision is assessed by taking into account
the recent sales experience, the ageing of inventories
and other factors that affect inventory obsolescence.
Share Option Reserve
The share option reserve represents fair value of
options on grant date. Fair value is independently
determined using 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.
28 Dicker Data Limited | Annual Report 2012
Notes to the Financial Statements
for the year ended 30 June 2012
(s) Adoption of New & Revised
Accounting Standards
During the current year, the company has adopted
all of the new and revised Australian Accounting
Standards and Interpretations applicable to its
operations which became mandatory.
The adoption of these Standards has not had any material
impact on the fi nancial statements of the company.
Any new revised or amending Accounting standards
or interpretation that are not yet mandatory have not
been adopted
(t) New Accounting Standards for
Application in Future Periods
The following Australian Accounting Standards issued
or amended which may be applicable to the Company
but are not yet effective and have not been adopted in
preparation of the fi nancial statements at reporting date.
The new and amended Accounting Standards and
interpretations are not expected to have any material
impact on the annual fi nancial statements of the Company.
AASB No.
Title
9
10
11
12
13
Financial Instruments
Consolidation
Joint Arrangements
Disclosure of Interests in Other Entities
Fair Value Measurement
1053
Application of Tiers of Australian Accounting Standards
Issue Date
Dec 2010
Aug 2011
Aug 2011
Aug 2011
Sep 2011
Jun 2010
Operative Date
(Annual reporting
periods beginning
on or after)
1 Jan 2015
1 Jan 2013
1 Jan 2013
1 Jan 2013
1 Jan 2013
1 Jul 2013
2010 – 2
Amendments to Australian Accounting Standards arising from
Reduced Disclosure Requirements
Jun 2010
1 Jul 2013
2010 – 7
Amendments to Australian Accounting Standards arising from
AASB 9 (December 2010) [AASB 1, 3, 4, 5, 7, 101, 102, 108, 112,
118, 120, 121, 127, 128, 131, 132, 136, 137, 139, 1023 & 1038
and Interpretations 2, 5, 10, 12, 19 & 127]
Dec 2010
1 Jan 2013
2010 – 8
Amendments to Australian Accounting Standards – Deferred
Tax: Recovery of Underlying Assets [AASB 112]
Dec 2010
1 Jan 2012
2010 – 10
Further Amendments to Australian Accounting Standards –
Removal of Fixed Dates for First-time Adopters [AASB 2009-11
& AASB 2010-7]
2011 - 4
2012 - 2
Amendments to Australian Accounting Standards to Remove
Individual Key Management Personnel Disclosure Requirements
[AASB 124]
Amendments to Australian Accounting Standards – Disclosures
– Offsetting Financial Assets and Financial Liabilities [AASB 7 &
AASB 132]
Dec 2010
1 Jan 2013
Jul 2011
1 Jul 2013
Jun 2012
1 Jan 2013
2012 - 3
Amendments to Australian Accounting Standards – Offsetting
Financial Assets and Financial Liabilities [AASB 132]
Jun 2012
1 Jan 2014
2012 - 5
Amendments to Australian Accounting Standards arising from
Annual Improvements 2009–2011 Cycle [AASB 1, AASB 101,
AASB 116, AASB 132 & AASB 134 and Interpretation 2]
Jun 2012
1 Jan 2013
Dicker Data Limited | Annual Report 2012
29
Notes to the Financial Statements
for the year ended 30 June 2012
2. REVENUE AND OTHER INCOME
Sales revenue:
Sale of goods
Other revenue:
Interest received
Discounts received
Recoveries
Other revenue
Total Revenue
(a) Interest received from:
Other corporations
3. EXPENSES FOR THE YEAR
Expenses:
Finance costs
Cost of sales
Bad and doubtful debts
Net loss on disposal of non-current assets:
Property, plant and equipment
4. INCOME TAX EXPENSE
(a) The components of tax expense comprise:
Current tax
Over/(Under) provision in respect of prior years
Deferred tax
Over/(Under) provision in respect of prior years
Reversal of tax effect on capital tax losses
Note
2(a)
15
(b) The prima facie tax payable on profi t before income tax is
reconciled to the income tax as follows:
Prima facie tax payable on profi t before income tax at 30%
(2011: 30%)
Add tax effect of:
Under provision for income tax in prior year
Non-deductible expenses
Income tax expense attributable to entity
The applicable weighted average effective tax rates are as follows:
30 Dicker Data Limited | Annual Report 2012
2012
$’000
2011
$’000
455,036
384,043
5
746
592
269
10
580
387
226
456,648
385,246
5
10
3,149
422,669
706
48
3,819
36
3,856
(119)
28
224
133
3,989
3,679
288
21
3,989
3,989
32.5%
2,292
357,866
713
(836)
2,798
(13)
2,785
(146)
17
-
(129)
2,656
2,637
4
16
2,656
2,656
30.2%
Notes to the Financial Statements
for the year ended 30 June 2012
Note
2012
2011
5. EARNING PER SHARE
(a) Basic earnings per share (cents)
From continuing operations attributable to the ordinary
equity holders of the company
(b) Diluted earnings per share (cents)
From continuing operations attributable to the ordinary
equity holders of the company
(c) Weighted average number of shares used
as denominator
Weighted average number of ordinary shares used as the
denominator in calculating basic earnings per share
Weighted average number of ordinary shares and options
granted are used as the denominator in calculating diluted
earnings per share
6. KEY MANAGEMENT PERSONNEL COMPENSATION
Note
Short-term benefi ts
Post employment benefi ts
Total compensation
Shares held by the directors as disclosed in the Directors’
Report remain unchanged from the previous year.
7. AUDITORS’ REMUNERATION
Auditing or reviewing the fi nancial report
Taxation advice and tax and FBT return
preparation and lodgement
8. DIVIDENDS
Distributions paid
Dividend paid:
Fully franked ‘A’ class dividend of $360.072 (2010: $220.044)
per share franked at the rate of 30% (2010: 30%)
Fully franked ‘B’ class dividend of $211.042 (2010: $220.044)
per share franked at the rate of 30% (2010: 30%)
Final dividend - 30 June 2011. Fully franked at $0.0200c per
ordinary share paid 28 September 2011 (2010: $0.01)
Interim dividend - 30 June 2012. Fully franked at $0.0093c
per ordinary share paid 12 January 2012 (2011: $0.00)
6.55
6.48
5.02
5.00
126,336
122,151
127,568
122,734
2012
$’000
1,754
157
1,910
102
79
181
-
-
2,530
1,176
2011
$’000
1,454
130
1,584
92
63
156
1,800
1,055
1,250
-
Dicker Data Limited | Annual Report 2012
31
Notes to the Financial Statements
for the year ended 30 June 2012
Note
8. DIVIDENDS (continued)
Interim dividend - 30 June 2012. Fully franked at $0.0093c
per ordinary share paid 4 April 2012 (2011: $0.00)
Dividends declared but not paid
Interim dividend - 30 June 2012. Fully franked at $0.0150c
per ordinary share declared 18 June 2012 and paid 06 July
2012 (2011: $0.00)
Franking credit balance:
Franking credits available for subsequent fi nancial years
based on a tax rate of 30% (2011: 30%)
2012
$’000
1,176
1,898
6,780
6,146
2011
$’000
-
-
4,105
5,419
The above amounts represent the balance of the franking account as at the end of the fi nancial year adjusted for
franking credits arising from:
- franking credits from dividends recognised as receivables at year end
- franking credits that will arise from payment of the current tax liability
- franking debits arising from payment of proposed dividends recognised as a liability
9. CASH AND CASH EQUIVALENTS
Cash on hand
Cash at bank
10. TRADE AND OTHER RECEIVABLES
CURRENT
Other receivables
Trade debtors
Less provision for impairment of receivables
(a) Loans to related corporations:
Beginning of the year
Loans advanced / repaid
End of year
(b) Provision for impairment of receivables
Movements in the provision for impairment of receivables:
Opening balance
Charge for the year
Closing balance
32 Dicker Data Limited | Annual Report 2012
-
222
222
4,406
64,369
(104)
64,265
68,670
-
-
-
135
(32)
104
1
-
1
9,107
54,583
(135)
54,447
63,554
900
(900)
-
106
29
135
Notes to the Financial Statements
for the year ended 30 June 2012
Past due but not impaired
The following table details the company’s trade receivables exposed to credit risk with ageing analysis and impairment
provided for thereon. Amounts are considered as ‘past due’ when the debt has not been settled within the terms and
conditions agreed between the company and the customer or counterparty to the transaction. Receivables that are past
due are assessed for impairment by ascertaining solvency of the debtors and are provided for where there are specifi c
circumstances indicating that the debt may not be fully repaid to the company.
Customers with balances past due but without provision for impairment of receivables amount to $4,495,729 as at 30 June
2012 (2011: $2,140,523). The company did not consider a credit risk on these balances after reviewing credit terms of
customers and trading history.
Past due and impaired :
Gross Impaired Receivables over 90 days
Less: Expected Insurance Recoveries
Past due but not impaired::
31 – 60 days overdue
61 – 90 days overdue
11. FINANCIAL ASSETS
CURRENT
Available-for-sale fi nancial assets
(a) Available-for-sale fi nancial assets:
Shares in unlisted companies
12. INVENTORIES
CURRENT
At cost:
Stock on hand
Less provision for impairment of stock
13. PROPERTY, PLANT AND EQUIPMENT
Freehold land
Buildings
Less accumulated depreciation
Note
(a)
2012
$’000
205
(101)
104
3,556
940
4,496
-
-
-
41,687
(364)
41,323
6,904
8,312
(340)
7,973
2011
$’000
404
(268)
135
1,857
13
2,141
-
-
-
40,472
(371)
40,101
6,904
8,225
(133)
8,092
Total land and buildings
14,876
14,996
Dicker Data Limited | Annual Report 2012
33
Notes to the Financial Statements
for the year ended 30 June 2012
Note
Fitout Costs - 230 Captain Cook Drive
Less accumulated depreciation
Plant and equipment
Less accumulated depreciation
Motor vehicles
Less accumulated depreciation
Total plant and equipment
Total property, plant and equipment
Carrying amount of motor vehicles under fi nance lease.
2012
$’000
1,025
(209)
817
1,127
(686)
440
710
(295)
415
1,672
16,548
405
13(a) MOVEMENT IN CARRYING AMOUNTS
Movements in carrying amounts for each class of property, plant and equipment.
Balance at 1 July 2010
Additions
Capitalised borrowing costs
Disposals
Depreciation expense
Freehold
land
Property
improvements
Buildings
Plant and
equipment
Motor
vehicles
$’000
8,434
$’000
444
(1,530)
(343)
(101)
$’000
8,238
861
273
(1,116)
(164)
$’000
690
1,039
(20)
(339)
$’000
364
33
(32)
(94)
2011
$’000
1,025
(87)
938
1,356
(925)
431
627
(357)
270
1,640
16,636
258
Total
$’000
18,170
1,932
273
(3,041)
(698)
Carrying amount at 30 June 2011
6,904
0
8,092
1,370
270
16,636
Additions
Disposals
Depreciation expense
87
(207)
336
(63)
(386)
547
(310)
(92)
970
(373)
(684)
Carrying amount at 30 June 2012
6,904
0
7,973
1,257
415
16,548
34 Dicker Data Limited | Annual Report 2012
Notes to the Financial Statements
for the year ended 30 June 2012
14. INTANGIBLE ASSETS
Website development – at cost
Less accumulated amortisation
Total intangible assets
15. TAX
(a) Liabilities
CURRENT
Provision for income tax
NON CURRENT
Deferred Tax Liability
The balance comprises temporary differences attributable to:
Amounts recognised in profi t or loss:
Land and Buildings
Plant and Equipment
Accrued income
Deferred tax liability
Movements in Deferred Tax Liability
Opening Balance
Credited / (charged) to profi t or loss
Credited / (charged) to equity
Closing Balance
(b) Assets
NON CURRENT
Deferred Tax Assets
The balance comprises temporary differences attributable to:
Amounts recognised in profi t or loss:
Provision for receivables impairment
Provision for employee entitlements
Accrued expenses
Inventory
Capitalised expenditure
Tax losses
Amounts recognised in equity:
Transaction costs on share issue
Deferred tax asset
Note
2012
$’000
93
-
93
2011
$’000
-
-
-
1,342
1,224
220
96
867
1,183
1,226
(44)
-
1,183
31
235
17
114
104
-
120
621
220
51
956
1,226
1,012
215
-
1,226
41
142
39
78
115
224
160
798
Dicker Data Limited | Annual Report 2012
35
Notes to the Financial Statements
for the year ended 30 June 2012
Note
Movements in Deferred Tax Asset
Opening Balance
Credited / (charged) to profi t or loss
Credited / (charged) to equity
Closing Balance
The tax effect of capital tax losses has been reversed as
future capital profi t unlikely.
16. TRADE AND OTHER PAYABLES
CURRENT
Trade creditors
Unearned Revenue
Other creditors
17. BORROWINGS
CURRENT
Debtor Finance
Lease liability
Bank loan - secured
NON CURRENT
Lease liability
(a) T otal current and non-current secured liabilities:
Debtor Finance
Bank loans
Lease liability
2012
$’000
798
(177)
-
621
54,809
1,031
2,680
58,520
45,988
156
-
46,145
959
45,988
-
1,115
47,103
2011
$’000
255
344
199
798
72,337
-
494
72,831
20,230
230
7,158
27,618
964
20,230
7,158
1,194
28,582
(b) The carrying amounts of non-current assets pledged as security are:
Mortgaged land and buildings
1,223
16,636
(c) The debtor fi nance facility is secured by a registered fi xed and fl oating charge over all assets and undertakings of the
company, fi xed charge over all debtors, a Deed of Amendment and Acknowledgement between the fi nancier and a major
supplier to the aggregate of the fi nance facility and assignment of trade debtor insurance.
The covenants within the bank borrowings require meeting minimum interest cover ratios, current ratio, minimum EBITDA
calculation and minimum net tangible assets calculations, and a limit on the maximum amount of debt. Dicker Data has
complied with all other externally imposed capital requirements during the year.
36 Dicker Data Limited | Annual Report 2012
Notes to the Financial Statements
for the year ended 30 June 2012
Note
2012
$’000
2011
$’000
18. PROVISIONS
Provision for long service leave:
Opening balance at 1 July
Additional provisions raised
Amounts used
Balance at 30 June 2012
Provision for annual leave:
Opening balance at 1 July
Additional provisions raised
Balance at 30 June 2012
Total Provisions
Opening balance at 1 July
Additional provisions raised
Amounts used
Balance at 30 June 2012
Analysis of Total Provisions
Current
Non-current
19. ISSUED CAPITAL
126,500,000 fully paid Ordinary class shares
The company has share capital amounting to:
126,500,000 fully paid Ordinary class shares
(a) Ordinary Class Shares
At beginning of reporting period
Shares Issued on exercise of options
Share Option reserve
At the end of the reporting period
Date
09.08.11
09.08.11
232
174
(41)
365
241
176
417
473
350
(41)
782
580
202
782
844
844
$
539,895
300,000
4,162
173
66
(7)
232
143
98
241
316
164
(7)
473
414
58
473
540
540
Number
125,000,000
1,500,000
-
844,057
126,500,000
Fully paid ordinary shares rank equally in all respects. All ordinary shares issued as at 30 June 2012 are fully paid. Ordinary
shares entitle the holder to participate in dividends and the proceeds on winding up of the company in proportion to the
number of and amounts paid on the shares held. On a show of hands every holder of ordinary shares present at a meeting
in person or by proxy is entitled to one vote, and upon a poll each share is entitled to one vote. The issue of shares in the
company, subject to legislative requirements, is under the control of the directors.
Dicker Data Limited | Annual Report 2012
37
Notes to the Financial Statements
for the year ended 30 June 2012
(b) Share Options
On the 9th of August 2011, Newport Capital Group Pty Ltd exercised 1,500,000 options at the strike price of $0.20c per
share. The company has received the payment for the options and has issued the shares to Newport Capital Group Pty Ltd.
In the 2011 fi nancial year options were granted to Stonebridge Securities Ltd and related parties. The options granted were
to acquire 1,200,000 fully paid ordinary shares, exercisable at $0.25 anytime within 36 months from the date of granting,
expiring on 24 January, 2014. As at the date of this report these options have not been exercised.
(c) Capital Management
Management controls the capital of the company in order to maintain a good debt to equity ratio, provide the shareholders
with adequate returns and to ensure that the company can fund its operations and continue as a going concern. The
company’s debt and capital includes ordinary share capital and fi nancial liabilities, supported by fi nancial assets.
Management effectively manage the company’s capital by assessing the company’s fi nancial risks and adjusting its capital
structure in response to changes in these risks and in the market. These responses include the management of debt levels,
distributions to shareholder and share issues. The Company announced in December 2011 a new dividend policy providing
for quarterly dividends to be paid, with the aim to pay out dividends of up to 100% of underlying after tax profi ts from
operations. In determining the amount of dividends management will take into account historical earnings of the Company,
available free cash fl ow from trading and projected capital expenditure.
Note
20. RESERVES
(a) Capital Profi ts Reserve (Pre-CGT)
The capital profi ts reserve records non-taxable profi ts on
sale of investments.
(b) Share Option Reserve
The share option reserve is used to recognise the grant fair
value of options issued but not exercised.
2012
$’000
369
1
370
2011
$’000
369
5
374
The share option reserve represents fair value of options on grant date. Fair value is independently determined using 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. The share option reserve has been adjusted for options exercised during the period.
21. CAPITAL AND LEASING COMMITMENTS
(a) Operating Lease Commitments
Non-cancellable operating leases contracted for but not
capitalised in the fi nancial statements
Payable:
not later than 12 months
between 12 months and fi ve years
(b) Capital Expenditure Commitments
Capital expenditure commitments contracted for:
Construction of warehouse and offi ce facilities including road
works as per development application
38 Dicker Data Limited | Annual Report 2012
159
346
505
3,600
104
324
428
409
Notes to the Financial Statements
for the year ended 30 June 2012
22. RELATED PARTY TRANSACTIONS
Other than the noted transactions all dealings with related parties are trivial or domestic in nature and occurred within
a normal employee/customer/supplier relationship on terms and conditions no more favourable than those which it is
reasonable to expect would have been adopted than if dealing at arm’s length in the circumstances.
Note
2012
$’000
2011
$’000
Transactions with related parties:
(a) Loans to/(from) directors
The directors had unsecured loan accounts, which have
since been paid out.
(b) Loans to related entities
Dicker Data Ltd has made loans to associated companies.
These loans were unsecured and at call. All loans were paid
out in the current year
23. OPERATING SEGMENTS
-
-
-
-
During the year the company operated in one business segment being wholesale distribution of computers and related
products. It’s operations were carried out mainly in Australia.
24. FINANCIAL RISK MANAGEMENT
The company’s fi nancial instruments consist mainly of accounts receivable and payable and fi nance and lease liabilities.
The totals for each category of fi nancial instruments are as follows:
Note
Financial Risk Management
Financial Assets
Cash and cash equivalents
Loans and receivables
Total Financial Assets
Financial Liabilities
Trade and other payables
Borrowings
Total Financial Liabilities
9
10
16
17
2012
$’000
222
68,670
68,893
58,520
47,103
2011
$’000
1
63,554
63,555
72,831
28,582
105,624
101,413
Dicker Data Limited | Annual Report 2012
39
Notes to the Financial Statements
for the year ended 30 June 2012
Financial Risk Management Policies
The directors’ overall risk management strategy seeks to assist the company in meeting its fi nancial targets, whilst minimising
potential adverse effects on fi nancial performance.
Although the company does not have any documented policies and procedures, the key management personnel manage
the different types of risks to which the company is exposed by considering risk and monitoring levels of exposure to interest
rate and credit risk and by being aware of market forecasts for interest rates. Ageing analyses and monitoring of specifi c credit
allowances are undertaken to manage credit risk. Liquidity risk is managed through general business budgets and forecasts.
The main purpose of non-derivative fi nancial instruments is to raise fi nance for company operations. The company does not
have any derivative instruments at year end. The directors and key management personnel meet on a regular basis to analyse
fi nancial risk exposure and to evaluate treasury management strategies in the context of the most recent economic conditions
and forecasts.
Specifi c Financial Risk Exposures and Management
The main risks the company is exposed to through its fi nancial instruments are (a) credit risk (b) liquidity risk and (c) interest rate risk:
(a) Credit risk
Exposure to credit risk relating to fi nancial assets arises from the potential non-performance by counterparties of contract
obligations that could lead to a fi nancial loss to the company.
Credit risk is reviewed regularly by the directors and key management personnel. It arises from exposures to customers, as well
as through deposits with fi nancial institutions. The company’s exposure to credit risk is limited due to debtor insurance which
is held over its trade receivables. The insurance policy limits the exposure of the company to 10% of the individual customer’s
balance plus the excess as specifi ed in the policy after an aggregate fi rst loss of $200,000. Receivables balances are monitored
on an ongoing basis with the result that the company’s exposure to bad debts has not been signifi cant.
It is the company’s policy that all customers who wish to trade on credit terms are subject to credit verifi cation procedures
including an assessment of their credit rating, fi nancial position, past experience and industry reputation. Credit limits are set
for each individual customer in accordance with parameters set by the directors. These credit limits are regularly monitored.
Customers that do not meet the company’s strict credit policies may only purchase in cash or using recognised credit cards.
Credit risk exposures
The maximum exposure to credit risk by class of recognised fi nancial assets at balance date, excluding the value of any collateral
or other security held, is equivalent to the carrying value and classifi cation of those fi nancial assets (net of any provisions) as
presented in the statement of fi nancial position.
The company has no signifi cant concentration of credit risk with any single counterparty or group of counterparties.
Trade and other receivables that are neither past due or impaired are considered to be of high credit quality.
(b) Liquidity Risk
Liquidity risk arises from the possibility that the company might encounter diffi culty in settling its debts or otherwise meeting its
obligations related to fi nancial liabilities. The company manages this risk through the following mechanisms:
- preparing forward-looking cash fl ow analyses in relations to its operational,investing and fi nancing activities;
- monitoring undrawn credit facilities;
- obtaining funding from a variety of sources;
- maintaining a reputable credit profi le;
- managing credit risk, related to fi nancial assets.
The tables below refl ect an undiscounted contractual maturity analysis for fi nancial liabilities. Financial guarantee liabilities are
treated as payable on demand since the company has no control over the timing of any potential settlement of the liability.
Cash fl ows realised from fi nancial instruments refl ect management’s expectation as to the timing of realisation. Actual timing may
therefore differ from that disclosed. The timing of cash fl ows presented in the table to settle fi nancial liabilities refl ect the earliest
contractual settlement dates and do not refl ect management’s expectations that banking facilities will roll forward.
40 Dicker Data Limited | Annual Report 2012
Notes to the Financial Statements
for the year ended 30 June 2012
Financial liability maturity analysis
Financial liabilities due for payment
Trade and other payables
Borrowings
Total contractual outfl ows
Note
2012
$’000
2011
$’000
Within 1 Year
Within 1 Year
58,520
46,145
72,831
27,618
104,665
100,449
Financial liabilities due for payment
1 to 5 Years
1 to 5 Years
Borrowings
Total contractual outfl ows
Financial Liabilities
Trade and other payables
Borrowings
Total expected outfl ows
959
959
58,520
47,103
964
964
72,831
28,582
105,624
101,413
16
17
Financial assets pledged as collateral
Certain fi nancial assets have been pledged as security for the debt and their realisation into cash may be restricted subject to
terms and conditions attached to the relevant debt contracts.
(c) Interest Rate Risk
The company’s main interest rate risk arises from borrowings.
All borrowings are at variable interest rates and expose the company to interest rate risk which will impact future cash fl ows and
interest charges and is indicated by the following fl oating interest rate fi nancial liabilities:
Floating rate instruments
Debtor fi nance
Bank loans - secured
Note
17
17
2012
$’000
45,988
-
45,988
2011
$’000
20,230
7,158
27,389
Sensitivity Analysis
The company has performed a sensitivity analysis relating to its exposure to interest rate risk at balance date. If interest rates
changed by -/+ 1% from the year end rates with all other variables held constant, post tax profi t would have been $321,920
lower/higher (2011: $191,720 lower/higher) as a result of higher/lower interest payments. The company constantly analyses
its interest rate exposure. Within this analysis consideration is given to alternative fi nancing and the mix of fi xed and variable
interest rates.
Dicker Data Limited | Annual Report 2012
41
Notes to the Financial Statements
for the year ended 30 June 2012
Note
2012
$’000
2011
$’000
25. CASH FLOW INFORMATION
(a) Reconciliation of Cash
Cash at the end of fi nancial year as shown in the Statement of
Cash Flows is reconciled to the related items in the statement
of fi nancial position as follows:
Cash
Cash at bank
(b) Reconciliation of cash fl ow from operations with profi t
Profi t after income tax
Non-cash fl ows in profi t:
Depreciation
Loss on disposal of fi xed assets
Changes in Assets & Liabilities:
Decrease (increase) in current inventories
Decrease (increase) in current receivables
Decrease (increase) in deferred tax assets
(Decrease) increase in deferred tax liabilities
(Decrease) increase in payables & Other
(Decrease) increase in provisions
(Decrease) increase in non current assets
(Decrease) increase in current tax liabilities
Net cash provided by (used in) operating activities
-
222
222
1
-
1
8,276
6,132
684
-
-
(1,223)
(6,994)
(14)
(44)
(14,311)
278
44
118
(12,994)
698
-
-
(15,724)
(24,477)
(543)
215
37,451
191
836
221
5,000
(c) Credit Stand-by Arrangement and Loan Facilities
In December 2011, Dicker Data entered into a new banking relationship with St George Bank for a total facility amount of
$56.8m, which included debtor fi nancing, asset fi nancing and other working capital facilities. The new facility has provided the
company with greater fl exibility in funding our working capital requirements. The unused limits of the facility as at balance date
amounted to $9,335,000 (2011: $948,583).
26. CONTINGENT LIABILITIES
As at 30 June 2012 a bank guarantee totalling $70,000 (2011: $nil) was provided to Sydney Water Corporation for works and
adjustment to a Sydney Water asset at 230 Captain Cook Drive, Kurnell. The works have been completed, but the guarantee will
remain in place until Sydney Water Corporation has reviewed all documents and inspected the adjusted asset.
27. EVENTS AFTER BALANCE DATE
In August the company entered into a contract to extend the current warehouse facility by an additional 5,000 square metres.
This will more than double the existing warehouse capacity and sets the Company up for future growth. Construction should
commence in September 2012 and the project is expected to be completed in 26 weeks. The construction will be fi nanced from
the Company’s cash fl ows and drawing on existing funding already in place with St George Bank.
There is no other matter or circumstance that has arisen since 30 June 2012 that has signifi cantly affected, or may signifi cantly
affect the Company’s operations, the results of those operations or the Company’s state of affairs in future fi nancial years.
42 Dicker Data Limited | Annual Report 2012
Shareholder Information
for the year ended 30 June 2012
The shareholder information set out below was applicable as at 22 August 2012
Ordinary Share Capital
As at 22 August 2012, the issued capital of the Company was 126,500,000 ordinary fully paid shares.
Distribution of equity securities
Analysis of numbers of equity security holders by size of holding:
Holding
1 to 1,000
1,001 to 5000
5,001 to 10,000
10,001 to 100,000
100,000 and over
ORDINARY SHARES
OPTIONS
Number of
Holders
Number of Shares Number of Holders Number of Shares
2
24
296
25
9
356
1,004
84,723
2,953,212
937,876
122,523,185
126,500,000
-
-
-
-
2
2
-
-
-
-
1,200,000
1,200,000
There was 1 holder of less than a marketable parcel of ordinary shares.
Unquoted Options
The Company had the following unquoted options on issue:
Option holder
Number of Options
Percentage
Stonebridge Securities Ltd
Exit Out Pty Ltd
600,000
600,000
1,200,000
50%
50%
100%
Dicker Data Limited | Annual Report 2012
43
Shareholder Information
for the year ended 30 June 2012
Twenty largest holders of quoted equity securities
Name
Mr David John Dicker
Ms Fiona Tudor Brown
Mr D Dippie & Mrs J Dippie & Bramwell Grossman Trustees (Dippie Family A/c)
Bluedale Pty Ltd (Comb Superannuation Fund A/c)
Mr S F Borness & Mrs C A Borness
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