Annual Report 2016
D T I
G R O U P L T D
A B N 1 5 0 6 9 7 9 1 0 9 1
Table of Contents
Corporate Directory ......................................................................................................................... …1
Directors’ Report ................................................................................................................................ 2
Consolidated Statement of Profit or Loss and Other Comprehensive Income ................................. 19
Consolidated Statement of Financial Position .................................................................................. 20
Consolidated Statement of Changes in Equity ................................................................................. 21
Consolidated Statement of Cash Flows ........................................................................................... 22
Notes to the Consolidated Financial Statements ............................................................................. 23
Directors’ Declaration ....................................................................................................................... 52
Auditor's Report ................................................................................................................................ 53
Auditor’s Independence Declaration ................................................................................................ 55
Shareholder Information ................................................................................................................... 56
Corporate Directory
Non-Executive Chairman
Managing Director / Chief Executive Officer
Non-Executive Director
Non-Executive Director
Non-Executive Director
Directors
Chris Morris
Richard Johnson
Neil Goodey
Glyn Denison
Jeremy King
Company Secretary
Bruce Mitchell
Registered and Principal Office
31 Affleck Road
Perth Airport WA 6105
Telephone: 08 9479 1195
08 9479 1190
Facsimile:
www.dti.com.au
Website:
Share Register
Computershare Investor Services Pty Limited
Yarra Falls
452 Johnston Street
Abbotsford Vic 3067
Telephone: 1300 850 505
Website:
www.investorcentre.com
Stock Exchange Listing
DTI Group Ltd shares are listed on the Australian Securities
Exchange (ASX code: DTI)
Corporate Advisor
Pendulum Capital Pty Limited
Level 1, 5 Ord Street
West Perth WA 6005
Telephone: 08 9282 5400
Auditors
BDO Audit (WA) Pty Ltd
38 Station Street
Subiaco WA 6008
Telephone: 08 6382 4600
Bankers
Australia and New Zealand Banking Group Limited
Allendale Square
77 St Georges Terrace
Perth WA 6000
Westpac Banking Corporation
109 St Georges Terrace
Perth WA 6000
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Directors’ Report
The Directors present their report for the consolidated entity, consisting of DTI Group Ltd (“DTI” or “the Company”) and the entities it
controlled at the end of, or during, the year ended 30 June 2016 (“Group”) and the auditor’s report thereon.
Directors
The names and details of the Company’s Directors in office during the financial year and until the date of this report are set out
below. Directors were in office for this entire period unless otherwise stated.
Chris Morris
Non-Executive Chairman
Term of Office
Chris was appointed Non-Executive Chairman of DTI on 29 June 2011.
Skills and Experience
Chris has worked across the global securities industry for more than 30 years. He co-founded Computershare in 1978 and oversaw
its listing on ASX in 1994. Chris’s long-term strategic vision and passion for the industry have been instrumental in transforming
Computershare from an Australian business into a successful global public company.
Other Directorships and Offices (current)
Non-Executive Director of Computershare Limited
Non-Executive Chairman of Smart Parking Limited
Other Directorships and Offices (former)
Nil
Board and Committee Memberships
Chairman of the Nominations and Remuneration Committee
Richard Johnson
Managing Director / Chief Executive Officer
Term of Office
Richard joined DTI as General Manager in 2005 and commenced the role as Chief Executive Officer in 2006. On 9 August 2011 he
joined the Board as Managing Director.
Skills and Experience
Richard’s qualifications include a Bachelor of Science in Electrical Engineering from the University of Calgary, and a Master of
Engineering Studies and a Master of Business Administration from the University of Western Australia. He has more than 20 years
experience in the transit technology sector. Richard held senior management positions at ERG Limited which developed, supplied
and managed integrated fare collection systems for the transit industry around the world.
Other Directorships and Offices (current and former)
Nil
Board and Committee Memberships
Member of the Nominations and Remuneration Committee
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Neil Goodey
Non-Executive Director
Term of Office
Neil co-founded DTI on 8 June 1995 and held the position of Managing Director until 2008.
Skills and Experience
Over the last 25 years Neil has founded and managed a number of successful technology-driven companies, including DTI. He
created the software-focused vision for DTI and worked directly with the Company’s engineering team to develop DTI’s products and
underlying intellectual property.
Other Directorships and Offices (current and former)
Nil
Board and Committee Memberships
Member of the Nominations and Remuneration Committee
Member of the Audit, Risk and Compliance Committee
Glyn Denison
Non-Executive Director
Term of Office
Glyn was appointed a Director on 19 January 2004. He was formerly an Executive Director of DTI responsible for business
development before relinquishing his executive responsibilities in December 2006.
Skills and Experience
Glyn’s qualifications include a Bachelor of Engineering and a Diploma in Business and Administration. He has over 30 years
experience in the development of international distribution of technical products for the public transport industry, including senior
roles at ERG Limited. Glyn has extensive knowledge of the public transit sector, including the existing customer base of DTI and its
business partners.
Other Directorships and Offices (current)
Non-Executive Chairman of OBJ Ltd
Chairman of Wesbuilders Cooperative Limited
Other Directorships and Offices (former)
Nil
Board and Committee Memberships
Member of the Nominations and Remuneration Committee
Member of the Audit, Risk and Compliance Committee
Jeremy King
Non-Executive Director
Term of Office
Jeremy was appointed a Director on 29 June 2011.
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Directors’ Report (contd)
Skills and Experience
Jeremy is a corporate lawyer by background and holds a Bachelor of Laws. He has over 15 years experience in domestic and
international legal, financial and corporate matters. Jeremy has extensive corporate experience, particularly in relation to cross-
border private equity and leveraged buy-out acquisitions, as well as acting for banks, financial institutions and corporate issuers in
respect of various debt and equity capital raisings.
Other Directorships and Offices (current)
Director and Company Secretary of Smart Parking Limited
Non-Executive Director Transcendence Technologies Ltd
Non-Executive Director Cott Oil and Gas Ltd
Non-Executive Director Red Mountain Mining Ltd
Other Directorships and Offices (former)
Non-Executive Director of CEB Resources PLC
Non-Executive Director of Orca Energy Limited
Chairman of Continuation Investments Limited
Board and Committee Memberships
Chairman of the Audit, Risk and Compliance Committee
Member of the Nominations and Remuneration Committee
Company Secretary
Bruce Mitchell
Date of appointment – 27 May 2012
Bruce is a qualified Chartered Accountant and has over 20 years experience in senior financial roles. He joined DTI in 2012 as Chief
Financial Officer and is responsible for the management and administration of all aspects relating to both internal and external
financial accounting and reporting. Prior to joining DTI, Bruce gained experience working as a financial director for several South
African-based companies. He has worked across varied industries including information technology and manufacturing.
Bruce has a Bachelor of Accounting Science (Honours) from the University of South Africa, and a Bachelor of Commerce from the
University of Natal.
Principal activities
DTI is a global leader of integrated surveillance, passenger communication systems, and fleet management solutions for the global
mass transit industry and other related markets. DTI’s customers are transit agencies, transit vehicle manufacturers, law
enforcement authorities and high-value freight operators. The Company offers the following products and services:
Advanced surveillance solutions – specialised hardware systems, incorporating video, audio, GPS tracking, communications
and high-speed recording technology; supported by sophisticated device and data management software to provide
comprehensive, fleet-wide, CCTV and vehicle management solutions.
Passenger communication solutions – specialised hardware systems, incorporating real time passenger information through
graphical and high brightness displays as well as public address and hearing aid loop communications, passenger emergency
communications, driver awareness systems incorporating live viewing of passengers, and infotainment systems; supported by
sophisticated device and content management software to provide a comprehensive, fleet-wide, passenger information
management solution.
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Managed services – back-end control room communications and infrastructure comprising wide-area urban surveillance, driver
development and risk mitigation, video management, vehicle data analysis and monitoring, schedule adherence analysis, IT
infrastructure, help desk, technical support and monitoring, and first line maintenance.
DTI markets and distributes its product range to customers worldwide, both directly and in conjunction with a network of integrators
and business partners.
DTI is a company limited by shares that is incorporated and domiciled in Australia. The Company is publicly listed on the Australian
Securities Exchange under the code “DTI”.
Review of operations
DTI experienced stronger sales in the 2016 financial year, which were up 10.3% to $16.22 million compared to sales in the prior year
of $14.71 million. This increase was principally due to improved sales in the US market.
Importantly, DTI’s recurring revenue totalled $8.95 million for the year which represents 55.2% of total sales, up from 38.0% at the
half year. This recurring revenue includes $2.57 million from maintenance activities plus a further $6.38 million of ongoing monthly
sales to existing clients including bus and rail manufacturers. These ongoing monthly sales are primarily due to fleet renewal
programs where contracts can extend for up to a decade. For example, DTI announced in July 2014 that its advanced surveillance
solution has been specified in a bus procurement tender issued by the San Francisco MTA. The bus procurement tender includes
the manufacture of up to 454 buses over a five-year period with orders having now commenced. Other examples include bus
procurements for the Brisbane City Council, Perth PTA, Philadelphia and light rail vehicles for San Francisco. With DTI’s advanced
surveillance solution being increasingly specified as the system of choice, we expect to see this recurring revenue to continue to
increase going forward in future years.
The outlook for the 2017 financial year remains strong with contracted and expected revenue currently totalling $15.0 million. This
compares to $10.8 million at this time 12 months ago for the 2016 financial year and $9.7 million at this time 24 months ago for the
2015 financial year. The contracted and expected revenue has increased due to stronger recurring revenue coupled with revenue
from new project wins such as Dallas Area Rapid Transit, Mersey Rail, Wright Bus, Alstom North West Rail, and Alstom London
Underground Northern Line.
The future outlook for DTI is positive, reinforced by the record number of prospects currently being pursued which total over 100 with
a corresponding value over $400 million compared to $200 million 12 months ago. The challenge is converting the opportunities into
projects or purchase orders in an ongoing timely manner.
Americas
DTI experienced strong sales in the USA in the 2016 financial year with sales of $6.46 million compared to $3.89 million in the
previous financial year. A large portion of these sales were for new bus procurements for a major USA city, where to date over 3,600
buses have been equipped with the DTI surveillance solution. Supply to this city commenced following a successful trial in 2009, and
the success of the DTI technology has seen procurement continue into its seventh year.
In July 2014, DTI announced that its advanced surveillance solution had been specified in a bus procurement tender issued by the
San Francisco MTA (“SFMTA”). The bus procurement tender includes the manufacture of up to 454 buses over a five-year period
with sales commencing in the first half of this financial year. Further to this, the DTI solution was recommended for additional vehicle
procurements with the SFMTA, such as the 64 vehicle light rail project which includes options for up to 260 rail cars over 13 years.
In August 2015, DTI was notified that its advanced surveillance solution was specified in a bus procurement tender issued by the
South Eastern Pennsylvania Transportation Authority (“SEPTA”), which serves the five counties in and around Philadelphia, PA.
SEPTA is the nation’s sixth largest transit property and is truly multi-modal, providing bus, trackless trolley, light rail, heavy rail,
regional rail and customised community transit (para transit) services. SEPTA’s video surveillance programme is the largest in the
USA, and it is a key contributor to the authority’s plummeting costs for claims and litigation over the past several years. The bus
procurement tender relates to the manufacture of up to 525 buses over a five-year period with orders having now commenced.
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Directors’ Report (contd)
Furthermore, DTI has been specified for SEPTA’s next procurement of 44 Silverliner 6 rail cars. As with the SFMTA, this confirms
strong USA transit agency support for DTI’s products over the coming years. In May 2016, DTI announced that it was successful in a
project to supply 231 systems for SEPTA’s existing Silverliner 4 rail cars.
In April 2016, DTI announced the award of a contract with Dallas Area Rapid Transit (DART) for the supply and installation of
advanced surveillance systems on 48 light rail vehicles (LRVs) for the city of Dallas, valued at approximately USD$2.6 million
(A$3.4 million) plus options for the supply and installation of an additional 115 LRVs valued at approximately US$6.3 million
(A$8.2 million). Deliveries for the initial 48 systems are expected to commence in the first half of FY17 and will be delivered over a
12 month period. The DTI solution will be supplied with full 4G/LTE ‘live’ streaming functionality which includes seamless integration
into the existing station and platform camera systems.
The advanced nature of the DTI solution is reinforced in the minutes of the DART board which stated: "On December 15, 2015, a
Request for Proposals (RFP) notification was sent to 531 firms for Furnishing and Installing Closed-Circuit TV (CCTV) on Light Rail
Vehicles (LRVs). By the closing date of February 9, 2016, four proposals were received. DTI USA Inc., received the highest scores
among the offerors. They possess the technical and financial capacity to perform the contract. The pricing is determined to be fair
and reasonable, and this firm is recommended for award … The evaluation of technical proposals resulted in DTI USA Inc.’s being
the only acceptable proposal. This is due to all other proposal equipment could not meet the solicitation specifications."
In January 2015, DTI created a wholly owned subsidiary in the US. The subsidiary has become an effective structure for DTI to
market directly to specific customers in the large North American market. This subsidiary forms an important part of DTI’s growth
strategy of extending the reach of DTI’s offering to transit operators primarily in bus and rail in North America. As part of the strategy,
DTI commenced direct sales in the US market in June 2015. In March 2016, DTI recruited an additional business development
resource in the US who has extensive experience in transit sales and is also an Emeritus member of the Business Members Board
of Governors at the American Public Transportation Association.
Australasia
DTI maintained a strong market position in the Australasian transit sector with sales of $8.34 million being slightly above the sales in
the previous financial year of $7.88 million. This revenue included ongoing monthly sales to a wide range of customers in Perth,
Adelaide, Canberra, Tasmania, Melbourne, Sydney and Brisbane.
In September 2015, DTI advised that it had signed a two-year contract extension for the support and maintenance of over 900
surveillance systems on Brisbane City Council (BCC) buses as well as an extension to the standing arrangement for the provision of
new surveillance systems. The extension also includes the support and maintenance of back office systems at seven depots across
the Brisbane area. BCC procured an additional 137 surveillance systems in the second half of the 2016 financial year.
In October 2015, DTI announced that it had received an order by Alstom Transport India Limited (“Alstom”) for the supply of
passenger communication and surveillance systems for trains being delivered to the Sydney Metro Northwest project. The order for
the procurement contract includes the provision of systems on 22 new trains valued at approximately $5.3 million with deliveries
expected to commence in the middle of the 2017 financial year. Importantly, the procurement fulfils DTI’s strategy to offer an
expanded technology suite integrating both transit surveillance and passenger communication systems. The passenger
communication system component comprises just over 80% of the value of the contract and represents a significant capability
expansion when compared to a surveillance only solution. Alstom, which is headquartered in France, is one of the largest train
builders in the western world. This project provides a significant opportunity to strengthen DTI’s relationship with Alstom in the future.
In January 2016, DTI was one of only 90 key suppliers invited to Alstom’s 2020 global supplier event in Chennai, India. These 90
suppliers represented approximately 50% of Alstom’s global procurement value.
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Europe, Middle East, Africa (EMEA)
DTI experienced weaker sales in the EMEA market with sales decreasing from $2.93 million in the 2015 financial year to $1.42
million in the 2016 financial year. However, the forward outlook for DTI in the EMEA market remains positive with a key number of
recent project wins combined with an excellent list of prospects.
DTI opened an office in the city of Besançon in July 2014 as its base for the French market. In August 2014, DTI announced an
order with its French partner, Cibest, for 36 advanced video surveillance systems for the Marseille Metro. Building on this success,
DTI received a further order for Marseille Metro in December 2015 for the supply of passenger communication systems to be
installed on all 36 of metro trains in Marseille.
In December 2015, DTI also advised that Cibest had been awarded a five-year framework agreement for the supply of video
surveillance systems by L’Association pour la Gestion Indépendante des Réseaux (AGIR) which is an association of 172
independent transport providers. The framework agreement caters for the standardised procurement by AGIR members for video
surveillance solutions. While the DTI solution is the sole surveillance system nominated by AGIR, the AGIR agreement does not bind
members to purchase the DTI solution.
In December 2015, DTI received an order for a trial surveillance system by our Dutch partner, VisiOn Isp, to retrofit Stadler trains in
the Dutch city of Utrecht. This is DTI’s first supply to Stadler Rail AG, the Swiss train builder, and subject to the trial being successful
an additional 24 trains may be procured.
DTI also confirmed in December 2015 that it had been successful in its tender for advanced automatic passenger counting on
8 trains for Merseyrail which operate in the Liverpool area. Carrying approximately 110,000 passengers each weekday, Merseyrail
forms one of the most heavily used railway networks in the UK outside of London.
In March 2016, DTI announced it had signed a contract for advanced surveillance systems for two fleets of vehicles totalling 168 rail
cars operated by Iarnród Éireann (“Irish Rail”). The systems will provide the customer, Irish Rail, with high-definition, forward- and
rear-facing cameras and the very latest DTI designed and manufactured mobile digital recording platform (MDR-6). The DTI solution
chosen by Irish Rail will also utilise the existing CCTV cameras within the passenger saloons and is supplied with full Wi-Fi, 3G/4G
‘live’ streaming and GPS capability.
DTI confirmed in March 2016 that it had received an order from leading vehicle manufacturer Wright Bus Ltd for the supply of
advanced surveillance systems for 80 double deck vehicles ordered for the City of Dublin. Each vehicle is being equipped with DTI’s
latest advanced MDR6 digital surveillance system with integral switching, enhanced ‘dual drive’ redundancy and communications
infrastructure for system management and data downloads plus 12 external and internally mounted cameras including high-definition
IP forward-facing and both high-definition IP and analogue internal cameras. This DTI solution is also supplied with full Wi-Fi, 3G/4G
‘live’ streaming and GPS capability.
In May 2016, DTI announced that it had received an order from its South African business partner for supply of advanced
surveillance systems on metro police vehicles in South Africa. The initial purchase order was valued at approximately $220,000 and
involved the supply of surveillance systems on 27 police cars plus additional static equipment which was delivered before the end of
June 2016. DTI successfully participated in an international tender process involving the supply and installation of up to 900 systems
for police vehicles over the next three years. As well as the supply of the police car systems, static ANPR cameras will be supplied in
the future which integrate with the city’s monitoring systems to allow the coordination of vehicle information between static and
mobile solutions.
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Directors’ Report (contd)
In August 2016, DTI announced the receipt of an order from Alstom UK for the supply, and installation of advanced CCTV
surveillance systems for the prestigious Northern Line fleet maintained and operated by Alstom on behalf of Transport for London on
the London Underground. The project involves the supply, installation and long-term support of 212 future-proofed and innovative
surveillance systems for the entire Northern Line fleet of vehicles, coupled with secure infrastructure facilities providing system health
and video data across multiple depots. With an expected project value of £886,000 (A$ 1.5 million), deliveries for the systems are
expected to commence late in the first half of the 2017 financial year and completed before the end of the financial year. The
systems will include the very latest on-board surveillance technology with the deployment of DTI’s market-leading, feature-rich MDR-
6 recording unit, including integral switching, Wi-Fi, dual-redundant HDDs, 4G and ‘dead reckoning’ GPS capability. Each train will
also be equipped with DTI's high-resolution colour cameras. This latest project is the first for DTI on the London Underground.
In July 2016, DTI recruited an additional business development resource based in Belgium to promote DTI’s solution to Belgium,
Dutch, German and Scandinavian countries.
Technology Development Activities
DTI continues to build on its suite of solutions to maintain its leadership position in surveillance and passenger information systems
and fleet management solutions for the global mass transit industry and other related markets. One key element of this strategy
includes continuing to invest in the Company’s research and development (R&D) program to develop new or improved products and
solutions. Custom modifications to DTI’s product range are carried out by the Company’s in-house development team. DTI’s ability to
modify both hardware and software, coupled with a close relationship to the end customer, allows for specific customer requirements
to be quickly and effectively delivered.
As part of this investment, DTI has purchased the latest generation testing equipment including: a vibration test bench which
simulates the vibration environment exerted on equipment, a shock test bench which simulates high impact effects, a DC power
analyser which provides productivity gains for sourcing and measuring DC voltage and current into equipment under test by
integrating up to 4 advanced power supplies with digital multimeters, scope, and data logging features, and a Digital Signal Analyser
which tests multiple high speed serial lanes or massive parallel network buses providing quick analysis of design interfaces. The
Digital Signal Analyser is the only one of its kind in Australia.
DTI is currently developing an extensive range of third generation passenger communication equipment to be used as part of the
Alstom North West Rail project. Equipment being developed includes an advanced digital video surveillance and passenger
information server with communications infrastructure for system management and data downloads. The server, called the TDR6,
will contain and manage all of the audio and display message information as part of the communications system. Other
developments include an IP-based audio communications system comprising public address, hearing aid loops, plus an automated
voice announcement system. The audio communications system provides computer and GPS driven automated announcements for
next stop, door open and close and other en-route passenger information messages, passenger emergency intercom units. External
LED driven destination indication signs are also being developed along with a 48” wide-screen LCD route displays, and internal
passenger information displays. All displays are IP-based, as well as digitally controlled and automated in conjunction with the audio
communications system. Also being developed is a driver display screen which provides status information and also interfaces with
the surveillance system to provide low latency live views from all cameras in up to 6 cars of the train plus a second 6 car coupled
train.
DTI's comprehensive back-end CCTV management solution which centralises and coordinates the vehicle CCTV and other data
continues to be improved and enhanced. The latest generation is called DTI Central. DTI Central caters for improved enterprise
views, more redundancy, improved logging, improved job queuing, increased scalability, easier configuration of many aspects of the
system and updated user interfaces. DTI Central will cater for increased integration with other solutions as they arise in the Smart
City environment.
As part of DTI’s comprehensive rail product suite, development continued on a pantograph and overhead wire infrastructure
inspection solution which uses machine vision and video analytics. These systems will be incorporated in the DTI Central
maintenance suite to provide rail maintenance staff with easy to reference pantograph infrastructure condition with alerts to potential
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threats and loss of service on the rail line. DTI has applied for four patents for this technology and currently has trials in Australia,
France, Turkey, and Poland.
DTI has also progressed trials in Poland and Australia on automated passenger counting to commercialisation with a project for
Merseyrail in the UK. The video based passenger counting module is a cost-effective way to count and monitor passenger numbers
on rail or bus fleets. With discreet overhead cameras above doorways, this technology uses a virtual trip-wire zone for detection of
human forms. Every time passengers cross a line or enter a designated area in either direction, the software registers a count
(in/out) and updates the database. This information is processed and stored on an on-board database partition within the DTI
recorder.
The development of the MDR6 product commenced in the 2015 financial year and has now been commercialised with first deliveries
commencing in the second half of 2016. The MDR6 is based on the cost-effective MDR5L which includes the integration of
technologies into the product such as dual frequency wireless networking, 3G/4G communications, lower power components, a
smaller footprint, 16 full-frame rate camera channels. The MDR6 also includes eight transit rated Power over Ethernet ports catering
specifically for the next generation of high resolution megapixel IP cameras.
Quality Assurance Activities
DTI qualified for ISO9001:2008 Quality Assurance accreditation with an audit in July 2015 by internationally recognised accreditation
firm Bureau Veritas. As the world’s most widely recognised quality management standard, ISO9001 outlines ways to achieve, as well
as benchmark, consistent performance and service. The ISO9001 accreditation provides further assurance to customers and will
cater to broadening business opportunities globally.
Cash position
The Company’s cash balance reduced to $0.6 million from $3.8 million at the end of June 2015. This was predominantly due to the
significant investment of $3.3 million made in internally generated Intangible assets.
Statement of Financial Position
The Company’s balance sheet remains strong in 2016. There is very low debt and liquidity is robust with the ratio of current assets to
current liabilities being 3.0 (2015: 4.1). In 2016 large investments were made in internally generated Intangible assets in the form of
numerous new products and Property, Plant and Equipment through financial leases of specialised technical equipment for R&D
testing.
Results and dividends
The result of the consolidated Group for the financial year ended 30 June 2016 was a $31,558 profit (2015: $113,517 profit) after a
$11,746 share of Virtual Observer’s loss for the year (2015: $11,803 loss), a $34,820 share of DTI EMEA’s loss for the year (2015:
$169,964 loss), a $2,415 share of DTI USA Inc.’s profit for the year (2015: $3,861 profit), a $10,140 share of DTI USA Holdings Inc.’s
profit for the year (2015: $4,574 profit) and a net foreign exchange loss of $294,814 (2015: $295,351 gain).
Total Revenue was $16.2 million, which is 10% higher than the prior year at $14.7 million, mainly due to improved sales in the
Americas market. Costs of Materials were slightly lower, primarily resulting from further cost reduction efforts. Employee Benefit
expenses were contained, with the majority of R&D employees’ costs being capitalised to the development costs and then
amortised. Certain R&D projects moved into the revenue generating stage with amortisation commencing and this led to higher
Depreciation and Amortisation expenses.
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Directors’ Report (contd)
Administration expenses increased due to higher professional fees, bank fees and insurances associated with the large number of
sales contracts being tendered on and entered into, plus DTI’s listed entity status and the additional R&D Tax Incentive claim for
expenditure incurred in prior years. The high costs involved in entering into the Poland market and of establishing an office in South
Africa continued to increase Marketing expenses. Other expenses rose with increased travel and subcontractors’ costs. During the
2016 financial year, the Company re-lodged its income tax returns with the Australian Taxation Office (ATO) for tax years 2012 to
2015, claiming further R&D costs not previously claimed under the R&D Tax Incentive scheme. The re-lodged income tax returns
have all been assessed by the ATO and this has resulted in additional R&D Grant Income of $1,889,267. It also had the effect of
increasing the tax expense by adjusting for costs previously claimed as an income tax deduction and subsequently claimed as R&D
Tax Incentive Costs. An amount of $0.8 million of the total R&D Grant income of $4.5 million was transferred out of the Profit and
Loss Statement and set off against the Intangible asset as it related to capitalised development costs; this led to the Tax Expense
being unexpectedly high.
The EBITDA result of the consolidated Group for the financial year ended 30 June 2016 was a $3,645,667 profit (2015: $1,529,197
profit) being positively influenced by adjustments to prior year R&D Tax claims.
No dividends have been paid or declared since the end of the previous financial year (2015: nil) and the Directors do not recommend
any dividend be paid.
The outlook remains strong and DTI has entered the 2017 financial year with a very robust list of prospects bolstered by ongoing
contracts and orders.
Significant changes in the state of affairs
There have been no significant changes in the state of affairs of DTI.
Events since the end of the financial year
No matters or circumstance have arisen that have significantly affected, or may significantly affect, the operations of DTI, the results
of those operations or the state of affairs of DTI in subsequent years that is not otherwise disclosed in this report.
Likely developments and expected results of operations
DTI remains confident in its outlook as it seeks to drive growth via its strong pipeline of opportunities. The Company’s ongoing
investment in R&D aims to strive for continued innovation and market leadership of the products and services that DTI offers to the
global mass transit industry and other related markets.
Environmental regulation
The Company is not subject to any environmental regulation. The Directors have considered compliance with the National
Greenhouse and Energy Reporting Act 2007 which requires entities to report greenhouse gas emissions and energy use. The
Directors have assessed that there are no current reporting requirements, but the Company may be required to do so in the future.
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Directors’ meetings
The number of Directors’ meetings and number of meetings attended by each of the Directors of the Company during the financial
year are as follows:
Board Meetings
Audit Committee Meetings
Remuneration Committee Meetings
Director
Attended
Eligible
Attended
Eligible
Attended
Eligible
Neil Goodey
Glyn Denison
Chris Morris
Richard Johnson
Jeremy King
5
4
5
5
5
5
5
5
5
5
4
4
–
–
4
4
4
–
–
4
3
3
3
–
3
3
3
3
–
3
Information on Directors’ interests in securities of DTI
Interest in Securities at the Date of this Report
Current Directors
Neil Goodey
Glyn Denison
Chris Morris
Richard Johnson
Jeremy King
Shares 1
6,575,198
2,887,638
18,048,144
494,908
369,573
Options
–
–
–
–
–
Note:
1 Shares means fully paid ordinary shares in the capital of the Company.
Remuneration report (audited)
This Remuneration Report, which forms part of the Directors' Report, sets out information about the remuneration of Key
Management Personnel (KMP) of the Group.
Details of KMP
Details of the KMP of the Group, during or since the end of the financial year are set out below:
Directors
Chris Morris
Richard Johnson
Neil Goodey
Glyn Denison
Jeremy King
Other KMP
Jean-Michel Florent
Bruce Mitchell
Non-Executive Chairman
Managing Director / Chief Executive Officer
Non-Executive Director
Non-Executive Director
Non-Executive Director
Chief Operating Officer
Chief Financial Officer
Unless otherwise disclosed, the KMP held their position from 1 July 2015 until the date of this report.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Directors’ Report (contd)
Remuneration Policy and Link to Performance
The Board has established the current remuneration structure and policies of the Company to ensure that they are aligned to the
needs of the business, and meet the Company’s remuneration principles. The Nominations and Remuneration Committee will
annually review the remuneration policies and remuneration of the KMP. This review will include the determination of incentive
packages of executive KMP. From time to time, the committee may also engage external remuneration consultants to assist with this
review.
The Company’s remuneration policy for the Managing Director / Chief Executive Officer (CEO) is detailed in a Management
Compensation Plan (MCP). The CEO is the only member of the KMP currently participating in the MCP.
DTI wishes to structure the total remuneration of the CEO in a way that not only incentivises the CEO to deliver on short-term
financial performance but also encourages him to build long-term shareholder value.
The MCP is based on the concept of a total package guide which is an indication of what the CEO’s total remuneration would be if
budgeted financial performance is achieved and the CEO performed satisfactorily. If the business and/or the CEO perform below
standard then the total remuneration will be less. If financial performance exceeds budget and there is above average
performance by the CEO then the package can increase by up to 18.75% of the targeted total remuneration.
The composition of the total package guide is:
base salary – 75% of package guide;
bonus payment (ST Bonus) – 12.5% of package guide or up to 25% of the base salary for exceptional performance payable in
cash; and
long-term incentive (LT Incentive) – 12.5% of package guide payable in equity securities unless otherwise determined by the
Board. This can be up to 33.3% of the base salary for exceptional performance.
The ST Bonus and LT Incentive are determined following the finalisation of the audited annual financial results. If employment has
ceased for any reason on or before the date when the ST bonus and LT Incentive are paid or are due for payment, eligibility to
receive the ST Bonus payment and LT Incentive lapses.
The CEO can elect to receive the ST Bonus payment in equity securities, subject to shareholder approval.
The non-financial ratings for both the bonus payment and LT Incentive are a guide only and individual scores may not be disclosed
to the CEO unless a score of less than two out of four on any criteria is assessed.
The Board reserves the right not to pay any bonus or LT Incentive if earnings are significantly below budget.
Assessing Performance and Claw-back of Remuneration
The Nominations and Remuneration Committee is responsible for assessing performance against KPIs and recommending to the
Board the bonus payment and LT Incentive to be paid.
In the event of serious misconduct or a material misstatement in the Company’s financial statements, the Board can cancel or defer
performance-based remuneration and may also claw back performance-based remuneration paid in previous financial years.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Elements of Executive Remuneration
Fixed Remuneration
Executive KMP and other executive management may receive their fixed remuneration as cash, or cash with non-monetary benefits
such as health insurance, and car allowances. Fixed remuneration is reviewed annually, or on promotion. Superannuation is
calculated on fixed remuneration at the rate of 9.5%.
Bonuses
Executive KMP and other executive management may receive a cash bonus as determined by the CEO and approved by the Board
following a performance review by the CEO.
LT Incentives
The CEO’s LT Incentive is determined in accordance with his Management Compensation Plan and is further explained in the
Relationship between Remuneration and DTI Performance section below.
The LT Incentives of the other executive management are shares in the DTI Employee Share Plan and are further explained in the
Relationship between Remuneration and DTI Performance section below.
Relative Proportions of Fixed and Variable Remuneration Expense
The following table shows the relative proportions of remuneration that are linked to performance and those that are fixed based on
the amounts disclosed as statutory remuneration expense.
Fixed Remuneration
At Risk – Short-term Bonus
At Risk – Long-term Incentive
2016
%
63
100
100
2015
%
63
100
100
2016
%
16
–
–
2015
%
16
–
–
2016
%
21
–
–
2015
%
21
–
–
Executive KMP
Richard Johnson
Jean-Michel Florent
Bruce Mitchell
Notes:
Richard Johnson (CEO) receives a base salary of $240,000 plus superannuation at the rate of 9.5%, with eligibility for ST Bonuses of up to $60,000 and LT
Incentives of up to $80,000 under the MCP. Details of the MCP are provided in a separate section of this Remuneration Report.
Jean-Michel Florent (COO) and Bruce Mitchell (CFO) are paid fixed salaries and may receive a cash bonus based on a performance assessment carried out by
the CEO and approved by the Board and are also eligible to participate in the DTI Employee Share Plan (DESP). Details of the cash bonus paid and the DESP
are set out in a separate section of this Remuneration Report.
Employment Contracts with KMP
Component
Fixed remuneration
Contract duration
Notice period – individual
Notice period – company
Termination payments
Managing Director / Chief Executive Officer
Other Executive KMP
$240,000
Ongoing contract
4 weeks
$175,000–$219,810
Ongoing contract
8 weeks
Between 1 and 5 weeks depending on
service and age of employee
None specified
Between 1 and 5 weeks depending on
service and age of employee
None specified
In the event of serious misconduct, termination may be without notice and without payment in lieu.
Note:
The Managing Director / Chief Executive Officer is eligible for compensation under the MCP as provided in a separate section of this remuneration report.
Other Executive KMP are eligible to participate in the DTI Employee Share Plan
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Directors’ Report (contd)
Non-Executive Director Remuneration
Non-Executive Directors receive a Board fee and fees for chairing or participating on Board committees, as set out below. They do
not receive performance-based pay or retirement allowances. The fees are inclusive of superannuation. The Chairman does not
receive additional fees for participating in or chairing committees. Fees are to be reviewed annually by the Nominations and
Remuneration Committee.
The Chairman of the Board receives a fixed fee of $50,000 per annum. Other Non-Executive Directors each receive an annual Board
fee of $30,000 plus an additional $5,000 per annum Audit, Risk and Compliance Committee fee. A further fee of $5,000 per annum is
paid to the chairman of the Audit, Risk and Compliance Committee. No additional fees apply with respect to the Nominations and
Remuneration Committee. The maximum annual aggregate Directors’ fee pool limit is $250,000.
All Non-Executive Directors have entered into a service agreement with the Company in the form of a letter of appointment. The
letter summarises various matters relating to the appointment including the position’s role and responsibilities, time commitments,
remuneration and expenses, outside interests, securities dealing policy and the treatment of confidential information. These matters
are consistently applied for each Non-Executive Director.
KMP Remuneration
Details of the nature and amount of each element of the remuneration of each KMP for the current and prior financial year are as
follows:
2016
Short-term Benefits
Salary and
fees
$
Cash bonus
$
Travel
allowance
$
31,964
35,000
50,000
240,000
40,000
234,582
173,333
804,879
–
–
–
21,000
–
1,043
10,000
32,043
–
–
–
4,800
–
5,690
–
10,490
Director
Neil Goodey
Glyn Denison
Chris Morris
Richard Johnson
Jeremy King
Jean-Michel Florent
Bruce Mitchell
Total
Notes:
Post-
Employment
Benefits
Super-
annuation
$
3,036
–
–
Annual and
long service
leave
$
–
–
–
18,877
19,308
–
12,259
4,375
35,511
–
19,308
17,256
58,908
Share-based
payments
(Note *)
$
–
–
–
–
–
2,507
2,343
4,850
Total
$
35,000
35,000
50,000
303,985
40,000
275,389
207,307
946,681
Richard Johnson (CEO) was awarded a ST Bonus of $9,000 and a LT Incentive of $12,000 for performance during the 2016 financial year, which were accrued
in the 2016 financial year.
Jean-Michel Florent (COO) was awarded a performance cash bonus of $1,043 for performance during the 2016 financial year, which was accrued in the 2016
financial year. On 15 April 2016, he was issued with 115,000 shares in the Company for no cash consideration in terms of the DTI Employee Share Plan (DESP).
Subject to him remaining in the employment of the Company, these DESP shares will vest one third per year on the anniversary date of 15 April over the next
three years. The bonus was based on a review of his performance in relation to sales targets for the financial year by the CEO and approved by the Board and is
not linked to the MCP.
Bruce Mitchell (CFO) was awarded a performance cash bonus of $10,000 subsequent to the end of the 2016 financial year for performance during the 2016
financial year. The Company has not accrued for the bonus which will therefore be expensed in FY2017. On 15 April 2016, he was issued with 107,500 shares in
the Company for no cash consideration in terms of the DTI Employee Share Plan (DESP). Subject to him remaining in the employment of the Company, these
DESP shares will vest one third per year on the anniversary date of 15 April over the next three years. The bonus was based on a review of his performance for
the financial year by the CEO and approved by the Board and is not linked to the MCP.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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2015
Short-term Benefits
Salary and
fees
$
27,172
27,450
36,855
240,000
31,562
190,338
168,206
Cash bonus
$
Travel
allowance
$
–
–
–
104,000
–
15,943
30,000
–
–
–
4,660
–
11,660
–
721,583
149,943
16,320
Director
Neil Goodey
Glyn Denison
Chris Morris
Richard Johnson
Jeremy King
Jean-Michel Florent
Bruce Mitchell
Total
Notes:
Post-
Employment
Benefits
Super-
annuation
$
2,581
2,331
–
Annual and
long service
leave
$
–
–
–
10,523
27,316
–
12,138
5,231
27,892
–
19,171
17,405
68,804
Share-based
payments
(Note *)
$
–
–
–
-
–
–
–
–
Total
$
29,753
29,781
36,855
386,499
31,562
249,250
220,842
984,542
Richard Johnson (CEO) was awarded a ST Bonus of $14,000 and a LT Incentive of $24,000 for performance during the 2015 financial year, both of which were
accrued in the 2015 financial year. Richard Johnson received a ST Bonus of $18,000 and a LT Incentive of $18,000, both of which were taken as cash
payments, for his performance for the 2014 financial year but were not accrued in FY2014 and therefore expensed in FY2015.
Jean-Michel Florent, (COO) was awarded a performance cash bonus of $1,988 subsequent to the end of the 2015 financial year. The Company has not accrued
for the bonus which will therefore be expensed in FY2016. The COO received a cash bonus of $13,955 for performance during the 2014 financial year which was
not accrued in FY2015 and has been expensed in the 2015 financial year. The bonus was based on a review of his performance in relation to sales targets for
each of the financial years by the CEO and approved by the Board and is not linked to the MCP. In the first year, commission of 2% on the sales to a new
customer is earned, 1% in the second year and 0.5% in each subsequent year thereafter.
Bruce Mitchell (CFO) was awarded a performance cash bonus of $15,000 subsequent to the end of the 2015 financial year. The Company has not accrued for
the bonus which will therefore be expensed in FY2016. The CFO also received a cash bonus of $15,000 for performance during the 2014 financial year which
was not accrued in FY2015 and has been expensed in the 2015 financial year. The cash bonus is at the discretion of the Board and is based on a review by the
CEO of non-financial criteria relating to the Chief Financial Officer’s role for each of the financial years. It is approved by the Board and is not linked to the MCP.
* Expenses relating to vesting of the shares issued under the DTI employee Share Plan.
Relationship between Remuneration and DTI Performance
The relationship between remuneration and DTI’s FY2016 performance for the following executive KMPs is set out below.
Richard Johnson
Cash bonus based on the achievement of budgeted EBITDA (70% weighting) and the achievement of other criteria including
projects and margins, business expansion, service levels and product reliability (30% weighting). The composition of the cash
bonus is 12.5% of the package guide or up to 25% of the base salary for exceptional performance.
LT Incentive based on the achievement of earnings per share performance compared to the previous period (50% weighting)
and non-financial performance including leadership, replicability and character (50% weighting). The LT Incentive forms 12.5% of
the package guide or up to 33% of the base salary for exceptional performance.
Jean-Michel Florent
Cash bonus based on sales in which he was directly involved. In the first year, commission of 2% on the sales to a new customer is
earned, 1% in the second year and 0.5% in each subsequent year thereafter.
Shares in the DTI Employee Share Plan is based on years of service with the Company and fixed remuneration.
Bruce Mitchell
The cash bonus is at the discretion of the Board and is based on non-financial criteria relating to the Chief Financial Officer’s role.
Shares in the DTI Employee Share Plan is based on years of service with the Company and fixed remuneration.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Directors’ Report (contd)
Performance-based Remuneration Granted and Forfeited during the Year
The following bonuses relate to performance for the 2016 and 2015 financial years awarded under the Company’s MCP. The
bonuses for the 2016 financial year were awarded subsequent to the end of the financial year; however, an accrual was recorded in
FY2016. No accrual was recorded for the bonus relating to performance of the CEO for FY2015 and it was therefore expensed in
FY2016.
Short-term Benefits
2016
Total
Opportunity
(Note 1)
$
Awarded
%
Forfeited
%
Total
Opportunity
$
Bonus relating to the 2016 financial year performance (accrued in FY2016)
LT Incentives
Shares / Cash
Granted
(Note 2)
$
Shares / Cash
Forfeited
$
Richard Johnson
60,000
15
85
80,000
12,000
68,000
Bonus relating to the 2015 financial year performance (accrued in FY2016)
Richard Johnson
60,000
23
77
80,000
24,000
56,000
Notes:
1
2
The CEO was awarded a ST Bonus of $9,000 and a LT Incentive of $12,000 for performance during FY2016, which were accrued in FY2016. The CEO received
a ST bonus of $14,000 and a LT Incentive of $24,000, for his performance for FY2015
The CEO does not participate in the Company’s Employee Share Plan.
No other KMP were awarded bonuses under the Company’s MCP for the 2016 or 2015 financial years.
Statutory Performance Indicators
DTI aims to align executive remuneration to the Company’s strategic and business objectives and the creation of shareholder wealth.
The following table shows measures of the Group’s financial performance over the last two years as required by the Corporations
Act 2001. However, these are not necessarily consistent with the measures used in determining the variable amounts of
remuneration to be awarded to KMPs. As a consequence, there may not always be a direct correlation between the statutory key
performance measures and the variable remuneration awarded.
Performance Indicators
FY2016
FY2015
Profit / (loss) after tax
$31,558
$113,517
Dividends
Share price
nil
$0.40
nil
$0.30
Basic earnings per share
0.03 cents
0.1 cents
DTI Employee Share Plan
The DTI Employee Share Plan (DESP) is a scheme under which shares may be issued by the Company to employees for no cash
consideration and has been put in place by the Company. All permanent employees (excluding directors) who have been
continuously employed by the group for a period of at least one year are eligible to participate in the scheme. Employees may elect
not to participate in the scheme.
The shares are recognised at the closing share price on the grant date (31c on 15 April 2016) as an issue of treasury shares by
the trust and as part of employee benefit costs over the period the shares vest. The shares vest one third per year on the
anniversary date of 15 April over the next three years.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
Page | 16
DTI Capital Pty Ltd (Trustee), a wholly owned subsidiary of the Company, has been appointed by the Company to act as the
trustee of the DESP. The Company has issued 2,000,000 DESP shares to the Trustee to hold for the benefit of employees until
the DESP shares cease to be subject to any vesting conditions, at which time the DESP shares will be transferred to the employee
or sold on behalf of the employee, with the sale proceeds remitted to the employee.
Treasury shares are shares in the Company that are held by DTI Capital Ltd for the purpose of issuing shares under the DESP. The
shares are held as treasury shares until such time as they are vested. Forfeited DESP shares may be reallocated in subsequent
grants.
Reconciliation of Ordinary Shares Held by KMP
KMP
Neil Goodey
Glyn Denison
Chris Morris
Richard Johnson
Jeremy King
Jean-Michel Florent
Bruce Mitchell
Balance at the Start
of the Year
6,575,198
2,887,638
18,048,144
469,908
350,000
527,000
249,000
Granted as
Compensation
(Note 2)
Received on
Exercise of Options
–
–
–
–
–
115,000
107,500
–
–
–
–
–
–
–
Acquired
(Disposed)
–
Balance at the End
of the Year
6,575,198
–
–
25,000
19,573
–
170,550
2,887,638
18,048,144
494,908
369,573
642,000
527,050
Notes:
1
2
None of the shares are held nominally by the Directors or any other KMP.
Subject to the KMP remaining in the employment of the Company, these DESP shares, which are shares issued under the treasury shares,
will vest will vest one third per year on the anniversary date of 15 April over the next three years.
Loans Given to KMP
No loans have been given or provided to KMP.
Other Transactions with KMP
Computershare Investor Services Pty Limited provides share registry service to DTI. Chris Morris (Non-Executive Chairman of DTI)
is a Non-Executive Director of Computershare Limited. DTI paid Computershare Investor Services Pty Limited $16,829 during the
current year (2015: $12,798). Transactions with Computershare Investor Services Pty Limited are based on normal commercial
terms and conditions.
Reliance on External Remuneration Consultants
There has not been any reliance on external remuneration consultants.
Adoption of Remuneration Report
At the 2015 Annual General Meeting, the resolution adopting the 2015 remuneration report was carried unanimously.
The Company received more than 97% of “yes” votes on its Remuneration Report for the 2015 financial year. The Company did not
receive any specific feedback at the Annual General Meeting or throughout the year on its remuneration practices.
This concludes the remuneration report, which has been audited.
Auditor’s independence
In relation to the audit of the financial report for the year ended 30 June 2016, the auditors have issued the Directors with an
independence declaration. Refer to page 55 for the specific declaration.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Directors’ Report (contd)
Non-audit services
The Board is satisfied that the provision of non-audit services during the year is compatible with the general standard of
independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the services disclosed below did
not compromise the external auditor’s independence for the following reasons:
All non-audit services are reviewed and approved by Board prior to commencement to ensure they do not conversely affect the
integrity and objectivity of the auditor.
The nature of the services provided does not compromise the general principles relating to auditor independence as set out in
the APES Code of Ethics for Professional Accountants.
The total fees for non-audit services paid to the auditor or related practices of the auditor during the year ended 30 June 2016 were
$7,896 (2015: $11,720).
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.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237 of the
Corporations Act 2001.
Indemnification of officers and auditors
During the financial year, the Company paid a premium in respect of a contract insuring the Directors of the Company and all
executive officers of the Company against a liability incurred as such Director, secretary or executive officer to the extent permitted
by the Corporations Act 2001. The contract of insurance prohibits disclosure of the nature of the liability and the amount of the
premium.
The Company has not otherwise, during or since the financial year, indemnified or agreed to indemnify an officer or auditor of the
Company or of any related body corporate against a liability incurred as such an officer or auditor.
Signed in accordance with a resolution of the Directors made pursuant to s298(2) of the Corporations Act 2001.
Richard Johnson
Managing Director
29 August 2016, Perth, Australia
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
Page | 18
Financial Statements
Consolidated Statement of Profit or Loss and Other Comprehensive Income
for the year ended 30 June 2016
Revenue from continuing operations
Other income
Change in inventory of finished goods
Raw materials and consumables used
Employee benefits expense
Depreciation and amortisation expense
Administration expenses
Marketing expenses
R&D expenses
Other expenses
Finance costs
Profit from operations before income tax
Income tax expense
Profit after income tax
Profit is attributable to:
Owners of DTI Group Ltd
Other comprehensive income
Items that may be reclassified to profit or loss:
Exchange differences on translation of foreign operations
Total other comprehensive loss
Total comprehensive loss for the year
Total comprehensive loss is attributable to:
Owners of DTI Group Ltd
Earnings per share for profit attributable to the
ordinary equity holders of the Company:
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
Note
2(a)
2(b)
2(c)
2(c)
2(h)
2(d)
3
2016
$
2015
$
16,216,338
3,584,157
14,705,897
1,338,250
375,935
(7,833,633)
(4,656,116)
(1,060,299)
(1,727,711)
(1,144,030)
(57,237)
(963,419)
(18,020)
2,715,965
(2,684,407)
31,558
736,816
(7,736,182)
(4,821,419)
(884,832)
(985,215)
(1,033,018)
(14,158)
(610,736)
(4,892)
690,511
(576,994)
113,517
31,558
113,517
(56,729)
(56,729)
(25,171)
(60,276)
(60,276)
53,241
(25,171)
53,241
8.5
8.5
0.03
0.03
0.14
0.14
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Consolidated Statement of Financial Position
as at 30 June 2016
Current assets
Cash and cash equivalents
Other financial assets
Trade and other receivables
Inventories
Other current assets
Total current assets
Non-current assets
Other receivables
Property, plant and equipment
Intangible assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Borrowings
Provisions
Total current liabilities
Non-current liabilities
Borrowings
Provisions
Deferred tax liabilities
Total non-current liabilities
Total liabilities
Net assets
Equity
Contributed equity
Reserves
Retained profits
Total equity
Note
4.1
4.2
4.3
5.1
4.3
5.2
5.3
4.4
4.5
5.4
4.6
5.4
3(c)
7.1
7.4(a)
7.4(b)
2016
$
2015
$
633,489
–
8,655,529
5,844,736
132,274
3,839,829
400,063
6,309,975
4,612,086
130,640
15,266,028
15,292,593
389,786
1,089,929
4,370,112
5,849,827
531,032
573,076
2,517,548
3,621,656
21,115,855
18,914,249
4,015,498
186,035
859,864
5,061,397
305,077
34,369
1,021,205
1,360,651
6,422,048
3,214,436
19,042
505,735
3,739,213
46,704
70,273
380,305
497,282
4,236,495
14,693,807
14,677,754
13,723,974
(94,142)
1,063,975
13,723,974
(78,637)
1,032,417
14,693,807
14,677,754
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Consolidated Statement of Changes in Equity
for the year ended 30 June 2016
Contributed
Equity
$
Options
Reserve
$
Employee
Share Plan
Reserve
$
Foreign
Currency
Translation
Reserve
$
Retained
Profits
$
Total
$
At 30 June 2014
9,274,384
1,156,957
–
–
–
–
–
–
–
(1,156,957)
Profit for the year
Other comprehensive
income/(loss)
Total comprehensive
income/(loss) for the year
Transactions with owners
in their capacity as
owners
Transfer option reserve to
retained earnings
Issue of share capital (net
of transactions costs)
At 30 June 2015
Profit for the year
Shares issued to
employees
Other comprehensive
income/(loss)
Total comprehensive
income/(loss) for the year
Transactions with owners
in their capacity as
owners
Issue of share capital (net
of transactions costs)
4,449,590
13,723,974
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
41,222
(18,361)
(238,057)
10,174,923
–
113,517
113,517
(60,276)
–
(60,276)
(60,276)
113,517
53,241
–
–
1,156,957
–
–
4,449,590
(78,637)
1,032,417
14,677,754
–
–
31,558
31,558
–
–
41,222
(56,727)
–
(56,727)
41,222
(56,727)
31,558
16,053
–
–
–
–
41,222
(135,364)
1,063,975
14,693,807
At 30 June 2016
13,723,974
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Consolidated Statement of Cash Flows
for the year ended 30 June 2016
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
R&D grant received
Interest paid
Tax paid
Note
2016
$
2015
$
15,978,596
(16,632,064)
91,540
991,861
(17,926)
(219,292)
14,661,528
(16,304,326)
51,038
833,895
(4,892)
(134,677)
Net cash inflow / (outflow) from operating activities
6(b)
192,715
(897,434)
Cash flows from investing activities
Payments for plant and equipment
Payments for intangible assets
Payment of term deposit
Net cash outflow from investing activities
Cash flows from financing activities
Proceeds from issues of shares
Share issue expenses
Proceeds from borrowings
Repayment of borrowings
Net cash inflow from financing activities
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Effect of foreign exchange on opening balances
Cash and cash equivalents at the end of the year
6(a)
(852,146)
(3,392,153)
400,063
(179,578)
(1,089,396)
–
(3,844,236)
(1,268,974)
5,635
–
510,356
(84,990)
431,001
(3,220,520)
3,839,829
14,180
633,489
4,734,111
(290,156)
–
(12,986)
4,430,969
2,264,561
1,447,821
127,447
3,839,829
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Notes to the Consolidated Financial Statements
Note 1: Segment information
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker.
The chief operating decision maker is the Board which assesses the financial performance and position of the group, and makes
strategic decisions.
Description of Segments
The Board examines the group’s performance from a geographic perspective and has identified three reportable segments of its
business, as set out in the table below. Revenue is allocated to a segment based on the location of the customer.
Segment Results and Other Segment Disclosures
2016
Total segment revenue
Inter-segment revenue
Revenue from external customers
EBITDA
Material items of income or expense
R&D grant income
Cost of sales – materials
Employee expenses and overheads
Material non-cash items other than
depreciation and amortisation included
in EBITDA
Non-current assets
2015
Total segment revenue
Inter-segment revenue
Revenue from external customers
EBITDA
Material items of income or expense
R&D grant income
Cost of sales – materials
Employee expenses and overheads
Material non-cash items other than
depreciation and amortisation included
in EBITDA
Non-current assets
Australasia
$
EMEA
$
8,337,765
–
2,355,764
(936,370)
Americas
$
6,594,128
(134,949)
6,459,179
812,472
Total
$
17,287,657
(1,071,319)
16,216,338
3,645,667
–
3,730,354
3,408,246
2,238,461
7,457,699
8,548,892
–
1,209
–
5,849,827
3,914,537
22,503
3,892,034
259,093
16,008,231
1,302,334
14,705,897
1,529,197
1,419,394
(844,060)
–
475,019
1,826,752
–
403,065
4,209,951
1,279,831
2,930,120
(767,324)
–
–
991,861
1,790,623
1,906,821
2,286,108
1,346,834
6,999,366
7,464,546
–
559,747
–
–
–
3,621,656
8,337,765
3,677,255
3,730,354
3,574,434
4,483,679
–
5,445,553
7,883,743
–
7,883,743
2,037,428
991,861
2,922,635
4,210,891
–
3,061,909
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 1: Segment information (contd)
Revenues of approximately $4,162,104 (2015: $2,894,369) are derived from a single external customer. These revenues are
attributed to the Americas segment.
Reconciliation of EBITDA to profit before income tax is as follows:
EBITDA
Interest revenue
Finance costs
Depreciation and amortisation
Profit before income tax from continuing operations
Note 2: Revenue and expenses
Accounting Policy
2016
$
3,645,667
148,617
(18,020)
(1,060,299)
2,715,965
2015
$
1,529,197
51,038
(4,892)
(884,832)
690,511
Revenues are recognised at fair value of the consideration received net of the amount of GST or value added tax payable to the
taxation authorities. Sales revenue represents sales of products or services. Sales of products are recognised when the significant
risks and rewards of ownership of the goods have passed to the buyer and can be measured reliably. Risks and rewards are
considered passed to the buyer at the time of delivery of the goods to the customer.
Service revenue is recognised when the fees in respect of services rendered are earned, usually when services have been provided
to customers.
Interest income is recognised on a time proportion basis using the effective interest method.
(a) Revenue
Revenue from sale of goods
Revenue from the rendering of services
(b) Other Income
R&D grant Note 2(b)(i)
Net foreign exchange gains / (losses)
Interest received
(i) Government grants
2016
$
2015
$
13,642,242
2,574,096
12,145,455
2,560,442
16,216,338
14,705,897
3,730,354
(294,814)
148,617
991,861
295,351
51,038
3,584,157
1,338,250
Government grants are assistance by the government in the form of transfers of resources to the Company in return for
past or future compliance with certain conditions relating to the operating activities of the entity. Government grants
include government assistance where there are no conditions specifically relating to the operating activities of the
Company other than the requirement to operate in certain regions or industry sectors.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Government grants relating to income are recognised as income over the periods necessary to match them with the
related costs and grants relating to assets are regarded as a reduction in asset. Government grants that are receivable
as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the
Company with no future related costs are recognised as income of the period in which it becomes receivable.
Of the R&D Grant Income of $3,730,354 for 2016, $1,841,087 relates to R&D expenditure incurred in the 2016 financial
year and $1,889,267 to R&D expenditure incurred in financial years 2012 to 2015, not previously claimed under the R&D
Grant Incentive scheme.
During the 2016 financial year, the Company relodged its income tax returns with the Australian Taxation Office (ATO)
for tax years 2012 to 2015, claiming further R&D costs not previously claimed under the R&D Tax Incentive scheme. The
re-lodged income tax returns have all been assessed by the ATO and this has resulted in additional R&D Grant Income
of $1,889,267.
Consistent with the requirements of AASB 120: Government Grants, R&D Grant Income in the 2016 financial year of
$1,475,525 related to expenditure on capitalised intangible assets and this has been set off against the value of those
intangible assets after reducing it by the amount of amortisation recognised in the 2016 financial year. This net set off
amount was $814,583 in the 2016 financial year.
(c) Material cost of sales
Material cost of sales
(d) Finance costs
Interest:
Non-related entities
Borrowing Costs
Chattel Mortgage
Finance lease charges
(e) Operating lease payments
Minimum lease payments
(f)
Defined contribution superannuation expense
Superannuation
(g) Share-based payment expense
Employee share based payment expense
(h) Depreciation and amortisation expense
Depreciation
Amortisation
2016
$
2015
$
7,457,698
6,999,366
6,503
22
7,633
3,862
18,020
156
–
–
4,736
4,892
187,091
144,291
545,235
462,197
41,222
–
337,229
723,070
1,060,299
258,232
626,600
884,832
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 3: Income tax
Current tax
Current tax is calculated by reference to the amount of income taxes payable or recoverable in respect of the taxable profit or tax
loss for the period. It is calculated using tax rates and tax laws that have been enacted or substantively enacted by reporting date.
Current tax for current and prior periods is recognised as a liability (or asset) to the extent that it is unpaid (or refundable).
Deferred tax
Deferred tax is accounted for using the comprehensive balance sheet liability method in respect of temporary differences arising
from differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax base of
those items.
In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised to the
extent that it is probable that sufficient taxable income will be available against which deductible temporary differences or unused tax
losses and tax offsets can be utilised. However, deferred tax assets and liabilities are not recognised if the temporary differences
giving rise to them arise from the initial recognition of assets and liabilities (other than as a result of a business combination) which
affects neither taxable income nor accounting profit. Furthermore, a deferred tax liability is not recognised in relation to taxable
temporary differences arising from goodwill.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in associates and are only recognised
to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits of the temporary
differences and that they are expected to reverse in the foreseeable future.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period(s) when the asset and
liability giving rise to them are realised or settled, based on tax rates (and tax laws) that have been enacted or substantively enacted
by reporting date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the
manner in which the Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the Company
intends to settle its current tax assets and liabilities on a net basis.
Current and deferred tax for the period
Current and deferred tax is recognised as an expense or income in the consolidated statement of profit or loss and other
comprehensive income, except when it relates to items credited or debited directly to equity, in which case the deferred tax is also
recognised directly in equity, or where it arises from the initial accounting for a business combination, in which case it is taken into
account in the determination of goodwill or excess.
During the 2016 financial year, the Company re-lodged its income tax returns with the Australian Taxation Office (ATO) for tax years
2012 to 2015, claiming further R&D costs not previously claimed under the R&D Tax Incentive scheme. The re-lodged income tax
returns have all been assessed by the ATO and this has resulted in additional R&D Grant Income of $1,889,267. It also had the
effect of increasing the tax expense by adjusting for costs previously claimed as an income tax deduction and subsequently claimed
as R&D Tax Incentive Costs.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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(a)
Income tax expense
Current tax expense
Deferred tax
Adjustments for current tax of prior periods (refer Note 2)
(b)
Numerical reconciliation of income tax expense
to prima facie tax payable
Profit before income tax expense
2016
$
847,897
480,614
1,355,896
2,684,407
2015
$
348,510
254,153
(25,669)
576,994
2,715,965
690,511
Prima facie tax payable on profit at 30% (2015: 30%)
814,789
207,153
Tax effect of:
R&D tax incentive
R&D amendments – grant Income
Other
Other non-deductible
Under / over (prior year adjustments and deferred tax) (refer Note 2)
Effect of lower statutory income tax rate in the UK and USA
Deferred taxes not brought to account
Income tax expense
(c)
Deferred income tax balances recognised in the accounts
Deferred tax liabilities
Work in progress
IP capitalised
Unrealised foreign exchange gain
Property, plant and equipment
Interest receivable
Other
Set off of deferred tax liabilities
Net recognised deferred tax liability
Deferred tax assets
Annual leave provision
Property, plant and equipment
Long service leave provision
Accrued audit fees and other creditors
Superannuation provision
Investments
Patents
Capital raising fees
Provision for diminution in trading stock
Provision for doubtful debts
Tax losses carried forward
Set off of deferred tax liabilities
Unrealised foreign exchange gain/losses
Net recognised deferred tax assets
973,757
(322,405)
(228,352)
13,265
1,389,866
5,935
37,552
2,684,407
(1,509,469)
–
(43,968)
(10,617)
(17,123)
(7,339)
567,311
(1,021,205)
179,595
20,384
29,048
13,144
48,660
–
10,503
83,917
41,400
2,296
75,424
(567,311)
62,940
–
356,960
–
(13,417)
–
–
(43,136)
69,434
576,994
(695,899)
(98,111)
(48,307)
–
–
(6,974)
468,986
(380,305)
150,298
35,951
21,082
23,475
228
79,916
10,503
121,044
24,193
2,296
–
(468,986)
–
–
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 3: Income tax (contd)
Net deferred tax assets are be brought to account when it is probable that immediate sufficient tax profits will be available against
which temporary differences and tax losses can be utilised.
Franking credits available for subsequent financial years based on a tax rate of 30% are $818 (2015: $5,978).
Note 4: Financial assets and liabilities
Note 4.1: Cash and cash equivalents
Cash
Petty Cash
Note 4.2: Other financial assets
Term deposits
Note 4.3: Trade and other receivables
2016
$
633,224
265
633,489
2015
$
3,839,279
550
3,839,829
–
400,063
Trade receivables and other receivables are recorded at amounts due less any allowance for doubtful debts.
Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. An
allowance account (provision for impairment of trade receivables) is used when there is objective evidence that the Company will not
be able to collect all amounts due according to the original terms of receivables. The amount of the allowance is the difference
between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest
rate. Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial. The amount of the
allowance is recognised in the profit or loss.
Current
Trade receivables
Accrued debtors
R&D grant/income tax receivable
Non-current
Accrued debtors
2016
$
5,882,968
116,862
2,655,699
8,655,529
2015
$
5,452,900
124,977
732,098
6,309,975
389,786
531,032
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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(a)
Impaired trade receivables
At 30 June 2016 current trade receivables of the Group with a nominal value of $7,651 (2015: $7,651) were impaired.
It was assessed that no portion of these receivables is expected to be recovered and the full amount has been provided for.
Movements in the provision for impairment of receivables are as follows:
At July 1
Provision for impairment recognised during the year
Receivables written off during the year as uncollectable
2016
$
7,651
–
–
7,651
2015
$
22,621
–
(14,970)
7,651
The creation and release of the provision for impaired receivables has been included in ‘other expenses’ in the statement of
profit or loss and other comprehensive income. Amounts charged to the allowance account are generally written off when there
is no expectation of recovering additional cash.
(b) Past due but not impaired
At 30 June 2016 trade receivables of $3,138,858 (2015: $2,207,599) were past due, but not impaired. These relate to a number
of independent customers for whom there is no recent history of default. The ageing analysis of these trade receivables is as
follows:
Up to 3 months
3 to 6 months
Over 6 months
2016
$
1,168,342
440,826
1,529,690
3,138,858
2015
$
1,530,082
360,091
317,426
2,207,599
The trade receivables do not contain impaired assets and are past due. Based on the credit history of these trade receivables, it
is expected that these amounts will be received when due. The Group does not hold any collateral in relation to these
receivables
The other classes within trade and other receivables do not contain impaired assets and are not past due. Based on the credit
history of these other classes, it is expected that these amounts will be received when due. The Group does not hold any
collateral in relation to these receivables.
(c) Foreign exchange and interest rate risk
Information on the Group’s exposure to foreign currency risk and interest rate risk in relation to trade and other receivables is
provided in Note 7.2.
(d) Fair value and credit risk
Due to the short-term nature of current receivables, their carrying amount is assumed to approximate their fair value.
Credit risk is assessed at the time a customer applies to open a credit account with the Group and is monitored thereafter on a
regular basis. Management assesses the credit quality of the customer, taking into account its financial position, past
experience, trade references, external rating where obtained and other factors, then sets credit limits. The compliance with
credit limits by customers is regularly monitored by management.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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(e) Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
Fair value hierarchy
The following tables detail the consolidated entity's assets and liabilities, measured or disclosed at fair value, using a three level
hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the
measurement date.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or
indirectly.
Level 3: Unobservable inputs for the asset or liability.
2016 Consolidated
Assets
Accrued debtor
Total assets
2015 Consolidated
Assets
Accrued debtor
Total assets
Level 1
$
–
–
Level 1
$
–
–
Level 2
$
–
–
Level 2
$
–
–
Level 3
$
506,647
506,647
Level 3
$
655,999
655,999
Total
$
506,647
506,647
Total
$
655,999
655,999
There were no transfers between levels during the financial years.
The carrying amounts of trade and other receivables and trade and other payables are assumed to approximate their fair
values due to their short-term nature.
The fair value of financial liabilities is estimated by discounting the remaining contractual maturities at the current market
interest rate that is available for similar financial liabilities.
Valuation techniques for fair value measurements categorised within Level 2 and Level 3
The accrued debtor amount relates to a sale to a customer of equipment which is being paid off in instalments. The loan is
being repaid over a ten-year period to June 2021 and is interest-free. The fair value of $506,647 has been calculated based on
cash flows discounted using a rate of 10%. The maximum exposure to credit risk at the end of the reporting period is the
carrying amount of each class of receivables set out above.
The Level 3 assets unobservable inputs and sensitivity are as follows:
2016
Description
Accrued debtor
Unobservable Inputs
Discount rate
Range
(Weighted Average)
10.0% to 11.0%
Sensitivity
1.0% change would increase/decrease fair value by $6,563
2015
Description
Accrued debtor
Unobservable Inputs
Discount rate
Range
(Weighted Average)
10.0% to 11.0%
Sensitivity
1.0% change would increase/decrease fair value by $65,600
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 4.4: Trade and other payables
Trade payables and other accounts payable are recognised when the Company becomes obliged to make future payments resulting
from the purchase of goods and services. The amounts are unsecured and are usually paid within 60 to 90 days of recognition.
Trade payables
Other payables
ATO and HMRC (including PAYG)
Superannuation liability
FBT liability
Payroll tax liability
2016
$
3,471,592
323,860
(21,444)
162,199
13,382
65,909
4,015,498
2015
$
2,881,343
203,440
79,260
759
8,456
41,178
3,214,436
Risk exposure
Information about the Group’s exposure to foreign exchange is provided in Note 7.2.
Note 4.5: Borrowings (current)
In December 2015 and April 2016, DTI negotiated chattel mortgage loans with the ANZ bank to finance the purchase of specialised
technical equipment for R&D. The total amount utilised under the facility is $517,735 at interest rates of 3.99% and 3.90%
respectively. The loans are repayable monthly over a 36 month period.
Secured:
Net carrying amount – Capital Finance Australia Ltd loan
Net carrying amount – ANZ Ltd loan
Total current borrowings
Further information on loans to related parties is set out in Note 8.6.
The loans were based on normal commercial terms and conditions.
Refer to Note 7.2 for risk exposures and risk management details.
2016
$
17,547
168,488
186,035
2015
$
19,042
–
19,042
Accounting Policy
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at
amortised cost. Any difference between the proceeds (net of transactions costs) and the redemption amount is recognised in the
consolidated statement of profit or loss and other comprehensive income over the period of the borrowings using the effective
interest method. Fees paid on the establishment of loan facilities, which are not an incremental cost relating to the actual draw-down
of the facility, are recognised as prepayments and amortised on a straight-line basis over the term of the facility.
Financing Facility
Asset financing facilities of $491,112 were available at 30 June 2016 and were fully utilised.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 4.6: Borrowings (non-current)
Secured
Net carrying amount – Capital Finance Australia Ltd loan
Net carrying amount – ANZ Ltd loan
Total non-current borrowings
Refer to Note 7.2 for risk exposures and risk management details.
Note 5: Non-financial assets and liabilities
Note 5.1: Inventories
Raw materials / unassembled stock
Finished goods
Provision for inventory obsolescence (Note (a))
(a)
A provision for inventory obsolescence was established in a previous year. It
was re-assessed and adjusted this financial year and is included in the raw
materials and consumables used number in the statement of profit or loss and
other comprehensive income. The movement in the provision is comprised as
follows:
At July 1
Provision for inventory obsolescence recognized during the year
2016
$
40,948
264,129
305,077
2015
$
46,704
–
46,704
2016
$
4,148,998
1,834,858
(139,120)
5,844,736
2015
$
3,214,953
1,477,776
(80,643)
4,612,086
(80,643)
(58,477)
(139,120)
(64,704)
(15,939)
(80,643)
Accounting Policy
Inventories are valued at the lower of cost and net realisable value. Costs are assigned to inventory on hand by the method most
appropriate to each particular class of inventory, with the majority being valued on a weighted average basis by location. Net
realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the
estimated costs necessary to make the sale.
Note 5.2: Property, plant and equipment
Buildings
At cost
Less accumulated depreciation
Workshop and R&D plant and equipment
At cost
Less accumulated depreciation
2016
$
119,668
(45,702)
73,966
1,229,329
(587,822)
641,507
2015
$
119,668
(33,735)
85,933
592,219
(430,384)
161,835
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Office equipment and software
At cost
Less accumulated depreciation
Motor vehicles
At cost
Less accumulated depreciation
Total written down value
Movements in carrying amounts
Buildings
Balance at the beginning of the year
Additions
Depreciation expense
Carrying amount at the end of the year
Workshop and R&D plant and equipment
Balance at the beginning of the year
Additions
Depreciation expense
Carrying amount at the end of the year
Office equipment and software
Balance at the beginning of the year
Additions
Depreciation expense
Foreign currency translation
Carrying amount at the end of the year
Motor vehicles
Balance at the beginning of the year
Additions
Depreciation expense
Carrying amount at the end of the year
2016
$
1,175,315
(878,787)
296,528
214,891
(136,963)
77,928
1,089,929
85,933
–
(11,967)
73,966
161,835
637,109
(157,437)
641,507
224,270
215,036
(142,779)
1
296,528
101,038
–
(23,110)
77,928
2015
$
960,278
(736,008)
224,270
214,891
(113,853)
101,038
573,076
85,140
12,604
(11,811)
85,933
216,517
57,217
(111,899)
161,835
219,406
109,757
(104,702)
(191)
224,270
130,858
–
(29,820)
101,038
Accounting Policy
Plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to
the acquisition of the items.
Depreciation is provided on property, plant and equipment. Depreciation is calculated on either a diminishing value or straight line
basis so as to allocate the net cost or other re-valued amount of each asset over its estimated useful life or in the case of certain
leased plant and equipment the shorter lease term.
The following estimated useful lives are used in the calculation of depreciation:
• plant and equipment – 2.5 to 5 years
• motor vehicles under finance lease – 5 years
• buildings – 10 years.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 5.3: Intangible assets
At 30 June 2016
Cost (gross carrying amount)
Accumulated amortisation
R&D grant income not recognisable
Net carrying amount
Movements in carrying amounts
Balance at 1 July 2015
Additions
Amortisation expense
R&D grant income not recognisable
Carrying amount at 30 June 2016
At 30 June 2015
Cost (gross carrying amount)
Accumulated amortisation
Net carrying amount
Movements in carrying amounts
Balance at 1 July 2014
Additions
Amortisation expense
Carrying amount at 30 June 2015
Development
Costs
$
Goodwill
$
Patents
$
308,205
(68,942)
–
Total
$
8,839,712
(3,655,017)
(814,583)
239,263
4,370,112
150,612
112,498
(23,847)
–
2,517,548
3,390,218
(723,071)
(814,583)
239,263
4,370,112
2,432
–
–
2,432
2,432
–
–
–
2,432
Goodwill
$
Patents
$
Total
$
2,432
–
2,432
2,432
–
–
2,432
195,707
(45,095)
5,449,495
(2,931,947)
150,612
2,517,548
117,299
50,820
(17,507)
2,054,686
1,089,396
(626,534)
150,612
2,517,548
8,529,075
(3,586,075)
(814,583)
4,128,417
2,364,504
3,277,720
(699,224)
(814,583)
4,128,417
Development
Costs
$
5,251,356
(2,886,852)
2,364,504
1,934,955
1,038,576
(609,027)
2,364,504
Accounting Policy
Amortisation of Capitalised Development Costs
During the period, DTI has reassessed the accounting estimates of the amortisation of its Capitalised Development Costs. DTI
has determined that a straight line basis in accordance with AASB108 para.40, is a more appropriate method rather than
amortisation based on the revenue method. This is a change in accounting estimates resulting in amortisation estimates being
$699,224 rather than $270,252 in the current period.
Impairment of assets
At each reporting date, the entity reviews the carrying amounts of its assets to determine whether there is any indication that
those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated
in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are
independent from other assets, the entity estimates the recoverable amount of the cash-generating unit to which the asset
belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been
adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying
amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised in profit or
loss immediately, unless the relevant asset is carried at fair value, in which case the impairment loss is treated as a revaluation
decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the
revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the
carrying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating
unit) in prior years. A reversal of an impairment loss is recognised in profit or loss immediately, unless the relevant asset is
carried at fair value, in which case the reversal of the impairment loss is treated as a revaluation increase.
Intangibles
Internally generated intangible assets, excluding capitalised development costs, are not capitalised and expenditure is
recognised in profit or loss in the year in which the expenditure is incurred.
Capitalised Development Costs
Research expenditure is recognised as an expense as incurred. Costs incurred on development projects (relating to the design
and testing of new or improved products) are recognised as intangible assets when it is probable that the project will be a
success considering its commercial and technical feasibility and its costs can be measured reliably. The expenditure
capitalised comprises all directly attributable costs, including costs of materials, services and direct labour. Other development
expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously
recognised as an expense are not recognised as an asset in a subsequent period.
The intangible assets in existence as at 30 June 2012 have been assessed as having a finite life and are amortised using the
straight line method over a period of 4 years. Intangible assets arising after 1 July 2012 were amortised in proportion to the
sales of the commercial units they relate to, as this was deemed to be a more accurate and reasonable basis. Due to changes
in accounting standards, as of 1 July 2015, the intangible assets in existence have been assessed as having a finite life and
are amortised using the straight line method over a period of years dependant on the estimate of which they will bring
commercial benefit.
The carrying value of an intangible asset arising from development expenditure is tested for impairment annually when the
asset is not yet available for use, or more frequently when an indication of impairment arises during the reporting period. All
other intangible assets are tested for impairment whenever events or changes in circumstances indicate that the company
amount may not be recoverable.
A summary of the policies applied to the Group’s intangible assets is as follows:
Policy
Useful lives
Amortisation methods used
Patents
Finite
Amortised over the period of
expected future benefits from the
related project on a straight-line
basis
Development Costs
Finite
Amortised over the period of
expected future benefits from the
related product on a straight-line
basis
Internally generated or acquired
Acquired
Internally generated
Impairment testing
Annually and more frequently when
an indication of impairment exists
Annually for assets not yet available
for use and more frequently when
an indication of impairment exists.
The amortisation method is
reviewed at each financial year end
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Note 5.3: Intangible assets (contd)
Patents have been assessed as having a useful life and are amortised using the straight line method over a period of 10 years.
The patents have been granted for between 15 and 20 years by the relevant government agency.
Gains or losses arising from de-recognition of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the assets and are recognised in profit or loss when the asset is derecognised.
Description of the Group’s Intangible Assets
(a) Development costs
Development costs are carried at cost less accumulated amortisation and accumulated impairment losses. The
intangible assets of $66,052 in existence as at 30 June 2012 have been assessed as having a finite life and are
amortised using the straight line method over a period of four years. Intangible assets arising from 1 July 2012 of
$2,685,831 are amortised on straight line basis. The remaining amount of development costs not ready for use of
$1,376,534 has been subject to impairment testing. If an impairment indication arises, the recoverable amount is
estimated and an impairment loss is recognised to the extent that the recoverable amount is lower than the carrying
amount. No impairment was needed for 2016 and 2015.
(b) Goodwill
Goodwill has been externally acquired and is carried at cost less accumulated impairment losses. The goodwill arose on
the acquisition of the remaining 50.5% of Virtual Observer Pty Ltd on 28 June 2012 and represents the difference
between the purchase price and the net liabilities.
(c) Patents
Patents have been externally acquired and are carried at cost less accumulated impairment losses. This intangible asset
has been assessed as having a useful life and is amortised using the straight line method over a period of 10 years. The
patents have been granted for between fifteen and twenty years by the relevant government agency. If an impairment
indication arises, the recoverable amount is estimated and an impairment loss is recognised to the extent that the
recoverable amount is lower than the carrying amount.
(d)
Impairment
The recoverable amount of intangible assets has been determined using the value in use method. Value in use has been
derived from calculating the discounted net cash flows expected to be derived from the asset. The cash flow for 2016 has
been based on the actual 2016 results, which is reasonable with a conservative approach used for budgeting by
management. The cash flow for 2017 has been based on the 2017 budget. The cash flow for 2018 to 2021 have been
based on extrapolating 2017 by using an inflation/growth rate of 5%. Cash flows have been estimated over five years, as
beyond five years would be difficult to support and justify. The cash flows have excluded cash flow from financing activity
(interest) and non-cash items (depreciation).
A discount factor of 9.0% has been used.
Note 5.4: Provisions
Current
Employee entitlements – long service leave
Employee entitlements – annual leave
Provision for tax payable
Non-current
Employee entitlements – long service leave
2016
$
62,459
602,695
194,710
859,864
2015
$
–
505,735
505,735
34,369
70,273
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Accounting Policy
Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave, long service leave, and sick
leave when it is probable that settlement will be required and they are capable of being measured reliably.
Provisions made in respect of wages and salaries, annual leave, long service leave and sick leave expected to be settled within 12
months are measured at their nominal values using the remuneration rate expected to apply at the time of settlement.
Note 6: Notes to the cash flow statement
For statement of cash flow purposes, cash and cash equivalents includes cash on hand and deposits held at call with financial
institutions.
(a)
Reconciliation of cash
For the purpose of the cash flow statement, cash includes cash on hand and in banks and short term deposits with banks.
Cash at the end of the financial year as shown in the cash flow statement is reconciled to the related items in the statement of
financial position as follows:
Australian Dollar bank accounts
British Sterling bank accounts
US Dollar bank accounts
Euro bank accounts
Petty cash
2016
$
236,999
97,671
189,366
109,188
265
633,489
2015
$
2,974,102
116,053
689,441
59,683
550
3,839,829
(b)
Reconciliation of profit after income tax to the net cash used in operating
activities
Operating profit
31,558
113,517
Non-cash items:
Depreciation and amortisation
Employee Share Plan expense
Grant income
Exchange differences on foreign operations
Change in operating assets and liabilities
(Increase) / decrease in trade and other receivables
(Increase) / decrease in inventories
(Increase) / decrease in other assets
Increase / (decrease) in trade and other payables
Increase / (decrease) in provision
Increase / (decrease) in deferred tax
1,060,299
41,222
(3,730,384)
(70,907)
2,335,024
(1,232,650)
(1,634)
898,022
221,265
640,900
884,832
–
(991,861)
(187,598)
355,700
(2,068,146)
(39,996)
837,858
21,765
176,495
Net inflow / (outflow) from operating activities
192,715
(897,434)
Non-cash financing and investing activities
Shares were issued to employees on the conversion of options under the DTI Employee Option Plan (refer Note 8.1: Share-
based payments).
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 7: Equity
Note 7.1: Contributed equity
(a) Ordinary shares
Balance at the beginning of financial year
Issued under IPO
Shares issued on option conversion
Shares issued in terms of Employee Share Plan
Capital raising costs
Treasury Shares
2016
No.
2016
$
2015
No.
2015
$
91,627,118
–
–
2,000,000
–
(2,000,000)
13,723,975
–
–
–
–
–
76,451,011
6,680,000
8,496,107
–
–
9,274,384
2,004,000
2,735,747
–
(290,156)
Balance at the end of the financial year
91,627,118
13,723,975
91,627,118
13,723,975
Fully paid ordinary shares carry one vote per share and carry the right to dividends.
Ordinary shares have no par value and the Company does not have a limited amount of authorised capital.
(b) Employee Share Plan
The DTI Employee Share Plan (DESP) is a scheme under which shares may be issued by the Company to employees for no
cash consideration and has been put in place by the Company. All permanent employees (excluding directors) who have been
continuously employed by the group for a period of at least one year are eligible to participate in the scheme. Employees may
elect not to participate in the scheme.
The shares are recognised at the closing share price on the grant date (31c on 15 April 2016) as an issue of treasury shares by
the trust and as part of employee benefit costs over the period the shares vest. The share vest one third per year on the
anniversary date of 15 April over the next three years.
DTI Capital Pty Ltd (Trustee), a wholly owned subsidiary of the Company, has been appointed by the Company to act as the
trustee of the DESP. The Company has issued 2,000,000 DESP shares to the Trustee to hold for the benefit of employees until
the DESP shares cease to be subject to any vesting conditions, at which time the DESP shares will be transferred to the
employee or sold on behalf of the employee, with the sale proceeds remitted to the employee.
Treasury shares are shares in the Company that are held by DTI Capital Ltd for the purpose of issuing shares under the DESP.
The shares are held as treasury shares until such time as they are vested. Forfeited DESP shares may be reallocated in
subsequent grants.
Accounting Policy
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity
as a deduction, net of tax, from the proceeds. If the Company re-acquires its own equity instruments, for example as a result of a share
buy-back, those instruments are deducted from equity and the associated shares are cancelled. No gain or loss is recognised in profit
or loss and the consideration paid including any directly attributable incremental costs (net of income taxes) is recognised directly in
equity.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 7.2: Financial risk management
The Group’s principal financial instruments are cash, trade and other receivables, trade and other payables, and borrowings. The main
purpose of these financial instruments is to raise finance for the Group’s operations. The Group has various other financial assets and
liabilities such as trade and other receivables and trade payables, which arise directly from its operations. The Group does not enter into
derivative transactions. The main risks arising from the Group’s financial instruments are interest rate risk, liquidity risk, credit risk and
foreign exchange risk. The Board reviews and agrees policies for managing each of these risks.
The following table details the Group’s exposure to interest rate risk as at 30 June 2016. The amounts disclosed in the table are the
contractual undiscounted cash flows. The payables cash flows equal their carrying balances as the impact of discounting is not
significant.
Maturing
1 Year or Less
$
Over 1 to 2 Years
$
Over 2 Years
$
Total Contractual
Cash Flows
$
Total
Carrying Value
$
Weighted
Average
Active Interest
Rate
%
30 June 2016
Financial Liabilities
Fixed rate
Other borrowings
Non-interest bearing
Payables
30 June 2015
Financial Liabilities
Fixed rate
Other borrowings
Non-interest bearing
Payables
Net Fair Value
202,446
209,136
100,452
512,034
491,112
4.3%
4,015,498
–
–
4,015,498
4,015,498
–
4,217,944
209,136
100,452
4,527,532
4,506,610
Maturing
1 Year or Less
$
Over 1 to 2 Years
$
Over 2 Years
$
Total Contractual
Cash Flows
$
Total
Carrying Value
$
Weighted
Average
Active Interest
Rate
%
12,846
12,846
40,055
73,430
65,746
6.5%
3,214,436
3,227,282
–
–
3,214,436
3,214,436
–
12,846
40,055
3,287,866
3,280,182
The carrying amount of financial assets and financial liabilities recorded in the financial statements represents their respective net fair
values, determined in accordance with the accounting policies disclosed in Note 9.
Credit Risk Exposure
The Group's maximum exposure to credit risk at reporting date in relation to each class of recognised financial assets is the carrying
amount of those assets as disclosed in the statement of financial position. There are no historical default rates in respect of receivables.
Cash balances and term deposits are held with financial institutions of minimum AA ratings.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 7.2: Financial risk management (contd)
Foreign Exchange Risk
The Company has transactions in currencies other than Australian Dollars which carry receivables and payables in the respective
currency. These financial instruments are not hedged.
The Company’s exposure to foreign currency risk at the end of the reporting period, expressed in Australian dollars, was as follows:
USD
$
189,366
3,304,942
(2,396,970)
0.74
30 June 2016
EUR
$
109,188
663,805
(118,297)
0.67
GBP
$
97,672
234,013
(2,583,029)
0.52
USD
$
689,441
2,686,687
(2,258,193)
0.77
30 June 2015
EUR
$
59,683
396,155
(6,668)
0.70
GBP
$
116,053
291,694
(1,625,594)
0.49
Cash
Trade and other debtors
Trade payables
Average exchange rates
Interest Rate Risk
The Company's loan and lease arrangements are subject to fixed interest rates and therefore would not have been impacted by any
increase/decrease in interest rates during the current year.
Profit is sensitive to higher/lower interest income from cash and cash equivalents and term deposits as a result of changes in interest
rates. At year end the Company’s bank account was earning interest of 1.05%.
Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Board's approach to
managing liquidity is to ensure, as far as possible, that the Group will always have sufficient liquidity to meet its liabilities when due. As
at 30 June 2016 and the date of this report, the Group has sufficient liquid assets to meet its financial obligations.
Sensitivity Analysis
Interest Rate Risk
The Company's loan and lease arrangements are subject to fixed interest rates and therefore would not have been impacted by any
increase/decrease in interest rates during the current year. Accordingly, an increase in interest rates would not have impacted the
Company's interest expense.
Movements in interest rates on the Company’s bank accounts and term deposits would not have a significant impact on the Company’s
result for the year.
Foreign Exchange Rate Risk
Foreign currency balances held in British Pounds relate to DTI EMEA Ltd. Any movements in the British Pound exchange rate would
not impact on profit for the year as any translation differences are taken to the foreign currency translation reserve.
Based on the financial instruments held at 30 June 2016, had the Australian dollar weakened by 5% against the US Dollar, Euro and
British Sterling, with all other variables held constant, the Group’s pre-tax profit for the year would have been $27,861 (2015: $34,251)
lower. If the Australian dollar had strengthened the corresponding impact would be an increase in pre-tax profit by the same amount.
Price Risk
Investments held are not listed or traded in active markets and therefore no price risk arises.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 7.3 Capital management
The Company’s objectives when managing capital are to:
safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for
other stakeholders; and
maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital
to shareholders, issue new shares or sell assets to reduce debt.
Under the terms of the major borrowing facilities with Australia and New Zealand Banking Group Limited (ANZ) that were entered into in
December 2015 and then revised in August 2016, the group is required to comply with the following financial covenants:
the Debt to EBITDA ratio not to exceed 2.75, and
the Borrowing Base Ratio not to exceed 40%.
The value of Debt to be used in the Debt to EBITDA ratio calculation is the sum of the utilization of the overdraft, asset finance and
guarantee ANZ facilities.
The Borrowing Base Ratio is the ratio of the amount owing under the ANZ facility to the sum of eligible stock and eligible debtors.
The group has complied with these covenants throughout the reporting period. As at 30 June 2016, the Debt to EBITDA ratio was 0.53
and the Borrowing Base Ratio was 16%.
Note 7.4: Reserves and accumulated losses
(a)
Reserves
Employee Share Plan reserve
Foreign currency translation reserve
Employee Share Plan Reserve
Balance 1 July
Transfer to retained income
Balance 30 June
Employee Share Plan Reserve records as an expense over the 3 year vesting
period, the value of the DTI Employee Share Plan shares issued. The expense for
the current financial year is the pro-rated amount from 15 April to 30 June 2016.
Foreign currency translation reserve
Balance 1 July
Currency translation differences – current year
Balance 30 June
The foreign currency translation reserve is used to record exchange differences
arising from the translation of the financial statements of foreign subsidiaries.
2016
$
41,222
(135,364)
(94,142)
–
41,222
41,222
2015
$
–
(78,637)
(78,637)
1,156,957
(1,156,957)
–
(78,637)
(56,727)
(135,364)
(18,361)
(60,276)
(78,637)
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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1,156,957
(b)
Retained profits / (accumulated losses)
Movements in retained profits were as follows:
Balance 1 July
Net profit for the year
Transfer from option reserves
Balance 30 June
Note 8: Other information
Note 8.1: Share-based payments
2016
$
2015
$
1,032,417
31,558
–
(238,057)
113,517
1,156,957
1,063,975
1,032,417
$
$
Shares in the DTI Employee Share Plan (DESP) were issued to employees. Details of the DESP are in Note 7.1(b). No share based
payments were made during the year ended 30 June 2016.
Employee Share Plan Shares
Outstanding at the beginning of the year
Granted during the year
Vested during the year
Forfeited during the year
Outstanding at the end of the year
2016
No.
–
1,891,000
–
–
1,891,000
2016
$
–
586,210
–
–
586,210
2015
No.
–
–
–
–
2015
$
–
––
–
–
These represent total fair value of shares to be issued under the DESP.
The following table contains the number (“No.”), weighted average exercise prices (WAEP) of and movements during the year in share
options issued under the former share option plan which has been replaced by the new DTI Employee Share Plan.
Share Options
Outstanding at the beginning of the year
Expired during the year
Exercised during the year
Outstanding at the end of the year
Exercisable at the end of the year
Note 8.2: Capital and leasing commitments
2016
No.
–
–
–
–
–
WAEP
$
–
–
–
–
2015
No.
12,370,806
(3,874,699)
(8,496,107)
–
WAEP
$
0.322
0.322
0.322
–
–
–
–
Leased assets classified as finance leases are recognised as assets. The amount initially brought to account is the present value of
minimum lease payments. Finance leased assets are amortised on a diminishing value basis over the estimated useful life of the
asset.
Finance lease payments are allocated between interest expense and reduction of lease liability over the term of the lease. The
interest expense is determined by applying the interest rate implicit in the lease to the outstanding lease liability at the beginning of
each lease payment period. Leases in which a significant portion of the risks and rewards of ownership are not transferred to the
Company as lessee, are classified as operating leases (Note 9). Payments made under operating leases (net of any incentives
received from the lessor) are charged to the consolidated statement of profit or loss and other comprehensive income on a straight-
line basis over the period of the lease.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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(a) Finance lease commitments
The Company signed two motor vehicle leases commencing in April 2014 and three motor vehicle leases commencing in
November 2014. The leases are 5 year finance leases with lease payments paid monthly in advance. There are no terms of
renewal, purchase options or escalation clauses in respect of the leases.
In December 2015 and April 2016, DTI negotiated chattel mortgage loans with the ANZ bank to finance the purchase of
specialised technical equipment for R&D. The total amount utilised under the facility is $517,735 at interest rates of 3.99% and
3.90% respectively. The loans are repayable monthly over a 36 month period.
Minimum finance lease payable:
Not later than 1 year
Later than 1 year but not later than 5 years
Minimum lease payments
Future finance charges
Present value of minimum lease payments
(b) Operating lease commitments
2016
$
202,427
323,954
526,381
(35,269)
491,112
2015
$
17,757
56,998
74,755
(9,009)
65,746
The Company signed an operating lease in June 2012 for the land on which the office and workshop facilities are situated with a
lease term of 5 years, with the option to extend for a further 5 years. The Company does not have the option to purchase the
leased asset at the expiry of the lease. The Company has been offered an early lease sign-on benefit which the Company will
be taking advantage of in August 2016, extending the lease until 2022 and as such has been included below.
The Company signed an operating lease in November 2014 for the lease, commencing 1 January 2015, of office space for DTI
EMEA Ltd in the UK with a lease term of 5 years. The Company does not have the option to purchase the leased asset at the
expiry of the lease.
Non-cancellable operating lease payable:
Not later than 1 year
Later than 1 year but not later than 5 years
Note 8.3: Contingent liabilities
Bank guarantees for unconditional undertaking of contracts
2016
$
146,220
592,997
739,217
2015
$
123,231
138,829
262,060
2016
$
2015
$
400,063
400,063
The Company has given bank guarantees relating to performance requirements of contracts. These are secured by term
deposits.
Under the contract for the lease of land on which the office and workshop facilities are situated, the Company may at some
future point (at the option of the Lessor) be required to “make good” the land and remove the building and any improvements
thereon. The Lessor is required to give four years notice of any such requirement. A bank guarantee in relation to this contract
of $107,800 is included in the amounts above.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 8.4: Events occurring after the reporting period
No matters or circumstance have arisen that have significantly affected, or may significantly affect, the operations of DTI Group Ltd,
the results of those operations or the state of affairs of DTI Group Ltd in subsequent years that is not otherwise disclosed in this
report.
Note 8.5: Earnings per share
Basic Earnings per Share
Basic earnings per share is calculated by dividing:
the profit or loss attributable to owners of the company, excluding any costs of servicing equity other than ordinary shares;
by the weighted average number of ordinary shares outstanding during the financial year,
adjusted for bonus elements in ordinary shares issued during the year.
Diluted Earnings per Share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:
the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares; and
the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all
dilutive potential ordinary shares.
Earnings per share
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
Reconciliation of earnings used in calculating earnings per share
The following reflects the income and share data used in the calculations of basic
and diluted earnings per share:
Net earnings used in calculating basic and diluted earnings per share
2016
Cents per Share
2015
Cents per Share
0.03
0.03
2016
$
0.14
0.14
2015
$
31,558
113,517
2016
Number of
Shares
2015
Number of
Shares
Weighted average number of shares used as the denominator
Weighted average number of ordinary shares used in calculating basic earnings per
share, adjusted to reflect the 7 for 1 share split completed 10 June 2014
Effect of dilutive securities
Adjusted weighted average number of ordinary shares used in calculating diluted
earnings per share
91,627,118
–
80,674,582
230,043
91,627,118
80,904,625
Note: There are no Options or other potential ordinary shares outstanding at 30 June 2016.
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Note 8.6: Related-party transactions
(a) Key management personnel
Compensation by category: key management personnel
Short-term benefits
Post-employment benefits
Share based payments
2016
$
882,923
58,908
4,850
946,681
2015
$
915,738
68,804
–
984,542
Computershare Investor Services Pty Limited provides share registry service to DTI. Chris Morris (Non-Executive Chairman of
DTI) is also a Non-Executive Director of Computershare Limited. DTI paid Computershare Investor Services Pty Limited
$16,829 during the current year (2015: $12,798). Transactions with Computershare Investor Services Pty Limited are based on
normal commercial terms and conditions.
Detailed remuneration disclosures are provided in the remuneration report on pages 11 to 17.
(b) Subsidiaries
DTI Group Ltd holds 100% (2015: 100%) of the shares in Virtual Observer Pty Ltd. A loan was created during the current and
prior years when payments were made by DTI Group Ltd on behalf of Virtual Observer Pty Ltd. At reporting date 2016 this loan
balance was $142, 426 (2015: $110,073).
DTI Group Ltd holds 100% of the shares in DTI EMEA Ltd (2015: 100%). A loan was created during the current and previous
years when payments were made by DTI Group Ltd to DTI EMEA Ltd. At reporting date 2016 this loan balance was
$1,265,248 (2015: $1,034,852). In addition, sales were made during the year by DTI Group Ltd to DTI EMEA Ltd and at
reporting date the debtor balance was $2,495,688 (2015: $2,022,520).
During the previous year, DTI Group Ltd incorporated DTI SaleCo Pty Ltd in which it holds 100% (2015: 100%) of the shares.
DTI SaleCo Pty Ltd’s name was changed to DTI Capital Pty Ltd during the current year. A loan was created during the current
year and prior years when payments were made by DTI Group Ltd on behalf of DTI Capital Pty Ltd. At reporting date 2016 this
loan balance was $2,642 (2015: $1,119).
During the previous year, DTI Group Ltd incorporated DTI USA Holdings Inc. (USA entity) in which it holds 100% of the shares
(2015: 100%). A loan was created during the current year when payments were made by DTI Group Ltd on behalf of DTI USA
Holdings Inc. At reporting date 2016 this loan balance was $61,098 (2015: $4,999).
During the year, DTI USA Holdings Inc. incorporated DTI USA Inc. (USA entity) in which it holds 100% of the shares (2015:
100%). A loan was created during the current year when payments were made by DTI Group Ltd on behalf of DTI USA Inc. At
reporting date 2016 this loan balance was $30,161 (2015: $12,544). In addition, sales were made during the year by DTI
Group Ltd to DTI USA Inc. and at reporting date the debtor balance was $155,957 (2015: $22,503).
No interest is charged on the loans with subsidiaries and there are no fixed repayment terms for the loans.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Note 8.7: Parent entity financial information: DTI Group Ltd
The individual financial statements for the parent entity show the following amounts:
Statement of financial position
Current assets
Total assets
Current liabilities
Total liabilities
Shareholders’ equity:
Issued capital
Reserves
Employee share plan reserve
Retained Income / (accumulated losses)
Loss for the year
Total comprehensive loss
2016
$
2015
$
20,446,571
21,212,023
(5,550,590)
16,476,951
19,107,562
(3,979,230)
(6,518,217)
(4,429,808)
14,014,131
(290,156)
41,222
1,895,927
14,014,131
(290,157)
–
953,780
14,693,806
14,677,754
(381,026)
(323,922)
(381,026)
(323,922)
Note 9: Summary of significant accounting policies
Statement of Compliance
This financial report includes the consolidated financial statements and notes of the Group. The financial report is a general purpose
financial report which has been prepared in accordance with the Corporations Act 2001, Australian Accounting Standards, Australian
Accounting Interpretations, and other authoritative pronouncements of the Australian Accounting Standards Board. The Group’s
financial statements and accompanying notes also comply with International Financial Reporting Standards (IFRS).
DTI is a for-profit company limited by shares incorporated in Australia whose shares have been publicly traded on the Australian
Securities Exchange from 9 December 2014.
The financial statements were authorised as per the Directors’ declaration on page 52 dated 29 August 2016.
Basis of Preparation
The financial report has been prepared on the basis of historical cost. Cost is based on the fair values of the consideration given in
exchange for assets.
In the application of IFRS management is required to make judgments, estimates and assumptions about carrying values of assets
and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical
experience and various other factors that are believed to be reasonable under the circumstance, the results of which form the basis
of making the judgments. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if
the revision affects both current and future periods.
Judgments made by management in the application of IFRS that have significant effects on the financial statements and estimates
with a significant risk of material adjustments in the next year are disclosed in Note 1(x) are, where applicable, in the relevant notes
to the financial statements.
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Accounting Policies
Accounting policies are selected and applied in a manner which ensures that the resulting financial information satisfies the concepts
of relevance and reliability, thereby ensuring that the substance of the underlying transactions or other events is reported.
The accounting policies set out below have been applied in preparing the financial statements for the year ended 30 June 2016 and
the comparative information presented in these financial statements for the year ended 30 June 2015.
The following significant accounting policies have been adopted in the preparation and presentation of the financial report:
(a) Principles of consolidation
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when
the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those
returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control
is transferred to the Group. They are deconsolidated from the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the Group. Intercompany transactions,
balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also
eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of
subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.
(b)
Investment and other financial assets
The Company classifies its financial assets as loans and receivables. The classification depends on the purpose for which the
investments were acquired. Management determines the classification of its investments at initial recognition.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active
market. They are included in current assets, except for those with maturities greater than 12 months after the reporting date
which are classified as non-current assets.
Loans and receivables are included in trade and other receivables (Note 8) in the statement of financial position.
Financial assets are derecognised when the rights to receive the cash flows from the financial assets have expired or have
been transferred and the Company has transferred substantially all the risks and rewards of ownership.
Loans and receivables are carried at amortised cost using the effective interest method.
The Company assesses at each reporting date whether there is objective evidence that a financial asset or group of financial
assets is impaired.
(c) Financial instruments issued by the Company
Debt and equity instruments are classified as either liabilities or as equity in accordance with the substance of the contractual
arrangement.
Transaction costs arising on the issue of equity instruments are recognised directly in equity as a reduction of the proceeds of
equity instruments to which the costs relate. Transaction costs are costs that are incurred directly in connection with the issue
of those equity instruments and which could not have been incurred had those instruments not been issued.
(d) Foreign currency
Functional and presentation currency
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Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary
economic environment in which the entity operates (‘the functional currency’).
The consolidated financial statements are presented in Australian dollars, which is the Company’s functional and presentation
currency.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of
monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognised in profit
or loss. They are deferred in equity if they relate to qualifying cash flow hedges and qualifying net investment hedges or are
attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses that relate to borrowings are presented in the consolidated statement of profit or loss in
finance costs. All other foreign exchange gains and losses are presented in the income statement on a net basis within other
income or other expenses.
Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date
when the fair value was determined. Translation differences on assets and liabilities carried at fair value are reported as part of
the fair value gain or loss. For example, translation differences on non-monetary assets and liabilities such as equities held at
fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss and translation differences
on non-monetary assets such as equities classified as available-for-sale financial assets are recognised in other
comprehensive income.
Group companies
The results and financial position of foreign operations (none of which has the currency of a hyperinflationary economy) that
have a functional currency different from the presentation currency are translated into the presentation currency as follows:
assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of
that statement of financial position;
income and expenses for each statement of profit or loss and other comprehensive income are translated at average
exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the
transaction dates, in which case income and expenses are translated at the dates of the transactions); and
all resulting exchange differences are recognised in other comprehensive income.
(e) Goods and services tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except:
where the amount of GST incurred is not recoverable from the taxation authority, it is recognised as part of the cost of
acquisition of the asset or as part of the item of expense; or
for receivables and payables which are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables.
Cash flows are included in the statement of cash flows on a gross basis. The GST component of cash flows arising from
investing and financing activities which is recoverable from, or payable to, the taxation authority is classified as operating cash
flows.
(f) New accounting standards and Australian accounting interpretations
New and amended accounting standards adopted
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The Group has applied the following standards and amendments for the first time for their annual reporting period commencing
1 July 2015:
AASB 2015-4 Amendments to Australian Accounting Standards.
Financial Reporting Requirements for Australian Groups with a Foreign Parent.
The adoption of this standard does not have any impact on DTI.
New accounting standards and interpretations not yet adopted
Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2016 reporting
periods and have not yet been applied in the financial report. The Group’s assessment of the impact of these new standards
and interpretations is set out below.
Application
Date of
Standard
1 Jan 18
Application
Date for
Group
(Year ended)
30 June 19
1 Jan 18
30 June 19
1 Jan 19
30 June 20
AASB
Amendment
AASB 9
Affected
Standard(s)
Financial
Instruments
AASB 15
Revenue
from
contracts with
customers
Nature of Change to Accounting
Policy
Changes to classification and
measurement requirements of
financial instruments and hedge
accounting
New standard for the recognition of
revenue based on the principle
that revenue is recognised when
control of a good or service
transfers to a customer
AASB 16
Leases
AASB 16 eliminates the operating
and finance lease classifications for
leases currently accounted for
under AASB 117 Leases. It instead
requires an entity to bring most
leases onto its balance sheet in a
similar way to how existing finance
leases are treated under AASB
117. An entity will be required to
recognise a lease liability and a
right of use asset in its balance
sheet for most leases. There are
some optional exemptions for
leases with a period of 12 months
or less and for low value leases.
Impact
While the group has yet to
undertake a detailed
assessment of the changes, no
significant impact is anticipated.
Management is currently
assessing the impact of the new
rules. At this stage, the group is
not able to estimate the impact
of the new rules on the group’s
financial statements. The group
will make more detailed
assessments of the impact over
the next 12 months.
To the extent that the entity, as
lessee, has operating leases
outstanding at the date of initial
application, 1 January 2019,
right-of-use assets will be
recognised for the amount of the
unamortised portion of the
useful life, and the lease
liabilities will be recognised at
the present value of the
outstanding lease payments.
Thereafter, earnings before
interest, depreciation,
amortisation and tax (EBITDA)
will increase because operating
lease expenses currently
included in EBITA will be
recognised instead as
amortisation of the right-of-use
asset, and interest expense on
the lease liability. However,
there will be an overall reduction
in net profit before tax in the
early years of a lease because
the amortisation and interest
charges will exceed the current
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AASB
Amendment
Affected
Standard(s)
Nature of Change to Accounting
Policy
Application
Date of
Standard
Application
Date for
Group
(Year ended)
Impact
straight line expense incurred
under AASB 117 Leases. This
trend will reverse in the later
years.
The Group will make a more
detailed assessment of the
impact over the next 12 months.
(g) Significant accounting estimates and judgements
Revenue recognition
In accordance with the accounting policy detailed in Note 2 the Company recognises revenue at the fair value of the
consideration received (net of the amount of GST payable) when the significant risks and reward of ownership of the goods
have passed to the buyer at the time of the delivery of goods to the customer, or when services rendered are provided to
customers. At 30 June 2016 management has determined that the profits on the contracts have been recognised in the correct
reporting period and that there are no future losses on any contracts that should be recognised at 30 June 2016.
Inventory obsolescence
Inventories are accounted for in accordance with the accounting policy detailed in Note 1(m). Where the net realisable value of
inventory is lower than its cost the Company recognises a provision for inventory obsolescence. Where stock has been held for
3 consecutive years with no movement and/or stock sold in a 12 month period is less than 20% of the stock on hand, a
provision for obsolescence is taken up. At 30 June 2016 management has determined that a provision for inventory
obsolescence of $80,643 (2015: $64,704) is still required for inventory where net realisable value is lower than its cost.
Development costs capitalised
Development costs have been capitalised in accordance with the accounting policy detailed in Note 5.3(a). At 30 June 2016
management has assessed that all of the net capitalised development expenditure carried forward at year end, of $4,128,417
(2015: $2,364,504), comprises all directly attributable costs, including costs of materials, services, direct labour and an
appropriate proportion of overheads.
Amortisation of intangible assets
Intangible assets are amortised over their useful life. Amortisation commences when the asset is available for commercial sale.
Share-based payment transactions
The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the dated at which they are granted. The fair value is the ASX share price.
Impairment
The Group assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to
impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. The recoverable
amounts of assets are calculated using a number of assumptions as disclosed in Note 5.3(d). DTI Group Ltd has recognised
an impairment expense of $0.484 million in respect of its loans to its subsidiaries Virtual Observer Pty Ltd, DTI USA Holdings
Inc., and DTI EMEA Ltd, as the loans are greater than the net assets of the subsidiaries. This impairment is eliminated in the
consolidated accounts of the Group.
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
Page | 50
2016
$
49,045
15,590
64,635
17,979
17,979
–
6,271
1,625
2015
$
53,768
9,259
63,027
16,122
18,399
11,720
–
–
(h) Auditors’ remuneration
BDO Audit (WA) Pty Ltd
Remuneration of the auditors of the entities for:
Auditing or reviewing the current year financial report
Auditing or reviewing the half year review
BDO LLP
Remuneration of the auditors of the entities for:
Auditing or reviewing the current year’s financial report
Non-audit services performed by BDO during the year comprise:
Investigating Accountant’s Report and review work for proposed initial
public offer and ASX listing
DTI EMEA Ltd Tax Consulting
Employee Share Plan Consulting
Note 10: Company information
DTI Group Ltd is a listed public company (ASX: DTI), incorporated and operating in Australia.
Registered office and principal place of business
31 Affleck Road
Perth Airport, WA, 6105
Tel: (08) 9479 1195
Internet: www.dti.com.au
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Directors’ Declaration
In the opinion of the Directors of DTI Group Ltd ("Company"):
1
2
3
The financial statements and accompanying notes set out on pages 19–51 are in accordance with the Corporations Act
2001, and:
(i)
(ii)
comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements; and
give a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and of its performance for
the year ended on that date.
In the Directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when
they become due and payable.
The Company has included in the notes to the financial statements an explicit and unreserved Statement of Compliance with
International Financial Reporting Standards.
The directors have been given the declarations by the managing director / chief executive officer and chief financial officer required
by section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the Directors by:
Richard Johnson
Managing Director
29 August 2016, Perth, Australia
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
Page | 52
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR’S REPORT
To the members of DTI Group Limited
Report on the Financial Report
We have audited the accompanying financial report of DTI Group Limited, which comprises the
consolidated statement of financial position as at 30 June 2016, the consolidated statement of profit or
loss and other comprehensive income, the consolidated statement of changes in equity and the
consolidated statement of cash flows for the year then ended, notes comprising a summary of
significant accounting policies and other explanatory information, and the directors’ declaration of the
consolidated entity comprising the company and the entities it controlled at the year’s end or from
time to time during the financial year.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error. In Note 1, the directors also state, in accordance with Accounting Standard AASB 101
Presentation of Financial Statements, that the financial statements comply with International
Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. Those standards require that we comply with
relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement of the financial report, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the company’s
preparation of the financial report that gives a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the company’s internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by the directors, as
well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275,
an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and
form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation other than for
the acts or omissions of financial services licensees
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations
Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, which
has been given to the directors of DTI Group Limited, would be in the same terms if given to the
directors as at the time of this auditor’s report.
Opinion
In our opinion:
(a) the financial report of DTI Group Limited is in accordance with the Corporations Act 2001,
including:
(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016
and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b) the financial report also complies with International Financial Reporting Standards as disclosed in
Note 1.
Report on the Remuneration Report
We have audited the Remuneration Report included in pages 11 to 17 of the directors’ report for the(cid:65535) (cid:65535)
year ended 30 June 2016. The directors of the company are responsible for the preparation and
presentation of the Remuneration Report in accordance with section 300A of the Corporations Act
2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit con
ducted in accordance with Australian Auditing Standards.
Opinion
In our opinion, the Remuneration Report of DTI Group Limited for the year ended 30 June 2016
complies with section 300A of the Corporations Act 2001.
BDO Audit (WA) Pty Ltd
Dean Just
Director
Perth, 29 August 2016
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY DEAN JUST TO THE DIRECTORS OF DTI GROUP LIMITED
As lead auditor of DTI Group Limited for the year ended 30 June 2016, I declare that, to the best
of my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of DTI Group Limited and the entities it controlled during the period.
Dean Just
Director
BDO Audit (WA) Pty Ltd
Perth, 29 August 2016
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN
77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK
company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under
Professional Standards Legislation, other than for the acts or omissions of financial services licensees.
Shareholder Information
The shareholder information set out below was applicable at 10 August 2016.
Distribution of Equity Securities
Size of Holding
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
Number of Shareholders
Percentage of Shareholding
25
355
266
305
63
1,014
0.00
1.08
2.31
10.62
85.99
100.00
There were 35 holders of less than a marketable parcel of ordinary shares.
Twenty Largest Registered Shareholders
Name
Invia Custodian Pty Ltd
Utilico Investments Ltd
Bluekara Pty Ltd
Legrande Investments Pty Ltd
Pendulum Investments Pty Ltd
Fineshore Pty Ltd
Citicorp Nominees Pty Ltd
LTC Management Pty Ltd
DTI Capital Pty Ltd
Mr Glyn Denison
Mr Neil Edward Goodey
Wood Street Pty Ltd
The Stephens Group Pty Ltd
Super Rab Pty Ltd
Mr Nino Andonio Tufilli
Bernville Pty Ltd
Dalcrest Investment Pty Ltd
Zanea Pty Ltd
Cleary Nominees Pty Ltd
Bond Street Custodians Ltd
Number of
Shares
17,348,144
12,468,750
4,646,880
3,924,709
3,648,869
2,825,650
2,245,459
2,007,642
2,000,000
1,955,660
1,928,318
1,785,227
1,600,000
1,400,000
1,344,599
1,200,000
1,191,664
1,106,000
1,102,796
1,000,000
Percentage of
Issued Shares
18.53
13.32
4.96
4.19
3.90
3.02
2.40
2.14
2.14
2.09
2.06
1.91
1.71
1.50
1.44
1.28
1.27
1.18
1.18
1.07
Total
66,730,367
71.29
D T I G R O U P L T D – A N N U A L R E P O R T 2 0 1 6
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Substantial Shareholders
Name
Chris Morris
Utilico Investments Ltd
Neil Goodey
LeGrande Investments Pty Ltd
Voting Rights
Number of Ordinary Shares in
the Substantial Shareholding
18,048,144
12,468,750
6,575,198
5,116,373
Subject to any special rights or restrictions attached to any class or classes of shares in the Company, at a general meeting every
holder of shares present in person or by proxy, body corporate representative or attorney has one vote on a show of hands and one
vote for each Share held on a poll.
Votes are cast by a show of hands unless a poll is demanded. The chairperson of the meeting or least five Shareholders entitled to
vote on the resolution or shareholders with at least 5% of the votes that may be cast on the resolution may demand a poll.
Escrowed Shares
The number of shares subject to voluntary escrow is nil (2015: 70,917,925). Following the release of the 2015 Annual Report, the
holding lock on the escrowed shares was lifted; thereby, ending the voluntary escrow period.
On-market Buyback
The Company is not currently conducting an on-market buyback of its shares.
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