DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Annual
Report
FINANCIAL YEAR 2023
AI for every phone
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Dubber enables Communications Service Providers to unlock
the potential of the network – turning every conversation into
an exponential source of value for differentiated innovation,
retention, and revenue. Listed on the ASX, Dubber is the
clear market leader in conversation intelligence and unified
conversational recording – embedded at the heart of over 205
Communications Service Provider networks and services.
For more information, please visit Dubber at dubber.net
2 | DUBBER ANNUAL REPORT FY23
Contents
FY23 Highlights
Chairman’s Letter
CEO’s Letter
About Dubber
Directors’ Report
Operating and Financial Review
Environmental, Social and Governance
Remuneration Report
Auditor's Independence Declaration
Financial Report
Directors’ Declaration
Independent Auditor's Report
Shareholder Information
Corporate Directory
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DUBBER ANNUAL REPORT FY23 | 3
FY23 Highlights
FY23 was a year of significant improvement with accelerating revenue growth
across the year, record cash receipts and a significant restructure to align the
cost base with core strategy going forward.
Dubber launched Moments in June 23 – a game changing out-of-the-box
Artificial Intelligence powered conversation intelligence solutions with early
demand from customer proving strong.
The Company anticipates $45m revenues in FY24 (+50% on FY23) on a
substantially lower cost base.
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Adjusted Revenue
8.5% QoQ CAGR
Q2 FY22
Q3 FY22
Q4 FY22
Q1 FY23
Q2 FY23
Q3 FY23
Q4 FY23
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$9,000,000
$8,000,000
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
FY23 Highlights
By the numbers...
↑ $30.0m
FY23 Adjusted Revenue of $30.0m,
up 23% on FY22. Reported revenue up
84% on FY22.
↑ 205+
Communications Service
Provider Connections , up 17%
on FY22.
↓ $20m
Major restructuring programme
undertaken during the year
to reduce cash costs by over
$20m per annum.
↓ 23%
Loss before depreciation,
amortisation, interest,
impairment and tax reduced
23% to $58.4m.
↑ $36.1m
Operating Cash receipts of $36.1m,
up 21% on FY22.
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Moments
‘Dubber Moments’ was launched in
June 2023 to the Company’s global
service provider partners. Moments is
a range of ‘out-of-the-box’ AI insights
delivered in consumable data points
and dashboards with a broad total
addressable market.
Expansion of core
network footprint in all
operating regions and
extension into Central
and South America for
the first time.
Continuing migration
of the large financial
institutions from legacy
call recording platforms
via tier 1 Communications
Service Providers.
Experienced people
added to the team
at operational and
board levels.
DUBBER ANNUAL REPORT FY23 | 5
Chairman’s
Letter
NEIL WILSON
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Dear Shareholder,
Dubber is a software solutions company, and its future
success is dependent on the market demand and competitive
Having joined Dubber in February 2023, I am pleased to
positioning of these solutions.
make my first Chairman’s report to shareholders covering the
2022/2023 financial year (FY23).
Amongst the significant restructuring and operational
optimisation initiatives that have occurred and continue to be
The financial year has provided both challenge and
actioned, our business has remained focussed on ensuring
opportunity for Dubber and a story of two halves where the
that the Dubber solutions continue to evolve and maintain a
second half has seen a significant restructure of the business.
leadership position in their relevant markets.
A restructure that saw the introduction of new people to the
board and management team and changes to the financial
In the second half of FY23, Dubber made a significant solution
model for the business, changes that were similar for a range
release with the announcement of Dubber Insights which
of technology companies globally as the market dynamics
includes a suite of Artificial Intelligence (AI) enabled solutions
evolved during and post the COVID impacted period.
called Moments. This release also saw the continued evolution
of converting the utility capability of call recording that saw
Dubber’s restructure program has resulted in a significant
call recording data packaged and presented to provide
reduction of headcount, costs and cash outflow of over $20m
organisations in all industries with the capability to measure
per annum via a very focused alignment of the organisation
and improve their business performance.
requirements to support the core strategy of the business and
to be positioned for future growth on a relatively stable cost
This is an important expansion of coverage for Dubber
base. There continues to be a significant focus on revenue
as the solutions not only continue to support compliance
growth and in June 2023 we announced to the market
forecast expectations of improved year on year revenue and
requirements, but now increasingly positions capability in
the higher value, business management and conversation
margin returns with a prediction of a break even cashflow
intelligence market. This capability continues to be built out
position expected to occur during FY25.
on the integrated Dubber platform making it increasingly
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more valuable and providing increased economies of scale as
and efficiency in the business and we look forward to seeing
more function is released, more partners and customers are
margin improvement as we continue to leverage our assets
engaged, and more data is collected.
and capability.
The emergence of the public awareness and consumerisation
FY23 has seen a significant transformation in the Dubber
of AI primarily though the awareness of ChatGPT, has been a
business. While the core vision of many years has endured,
significant advantage for Dubber. AI has been a longstanding
the business has been reset to move forward to deliver
part of the solution vision for Dubber as evidenced by
increased shareholder returns, provide a safe and enjoyable
the recent AI enabled solutions that have recently been
environment for the Dubber team, and to be considered a
released and the commitment to a program of ongoing
best-in-class partner across the Dubber ecosystem. Ambitious
further releases.
goals that are now in play.
Critical to the growth ambitions of Dubber is the success of
On behalf of the Dubber board, Chief Executive Officer
the partnerships with the Communications Service Provider
Steve McGovern, and the entire Dubber team, I would like
networks globally. Building and leveraging this vast global
to thank our shareholders for their continued support. We
distribution network in a business-to-business model, with
look forward to the future with a clear direction and level of
the end consumer in mind, is fundamental to the scaling of
optimism for increased business performance.
the expanding Dubber solution reach in every exiting and new
market we operate in.
The Dubber board and management team are committed to
an ongoing review and refinement of the business strategy to
ensure that there is a clear focus for growth and optimisation
of the operating model. While progress has been made,
there remains significant opportunity to drive effectiveness
Neil Wilson
Non-Executive Chairman
DUBBER ANNUAL REPORT FY23 | 7
CEO’s
Letter
STEVE MCGOVERN
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“ Financial Year 2023
has been a year of
consolidation of the
core operations with systemic
improvements augmented
by the appointment of key
personnel at an operational
and board level.
Significantly, the Company has completed the fundamental
development of its Artificial Intelligence (AI) programme which
fulfils a core strategy of the Company to provide a unique
and compelling capability at a time when AI has become
one of the world's largest growth opportunities across every
demographic segment.
The Company has continued to deliver on its core strategy
indicator, namely extending its footprint of Communications
Service Provider which underpins the future success of the
business, to over 205 at 30 June 2023.
Revenue Growth and Cost Management Initiatives
During the year the Company’s adjusted revenue1 has
grown 23% to $30m, with reported revenue growing 84% on
FY22. The Company’s revenue profile continues to grow in a
predictable manner at an improving rate. At the end of June
the monthly recurring revenue (MRR) is approximately $3m
per month. In June, the Company provided guidance that its
revenues for FY24 would be in excess of $45m dollars.
The Company also provided guidance that its cost structure
for FY24 would be under $65m (excluding non-cash share
based payments) following a significant cost reduction
programme which commenced in Q3.
The current economic macro climate has seen many
technology companies scale back their employee and
resource base and, in Dubber’s case, this was undertaken
once the core AI technology was developed to a point of
productisation and the markets for it established.
The Company had made acquisitions in the previous financial
year which has enabled it to expedite the development of
compelling, unique and world class product capabilities
which should underpin its future and truly revolutionise the
telecommunications sector.
This development programme and market assessment was
carried out over 18 months, post completion the Company
was able to assess its operating profile and re-structure the
business to focus on its core opportunities.
Accordingly, the business is now structured to be able to
adequately meet the requirements of its customers and
deliver a cash flow break even financial position in FY25.
World class technology to meet a global opportunity
The Company's technology is unique and matches its core
ambition which is to turn the world communications networks
into sources of valuable, revenue generating content.
It does this by supplying a unique platform, designed
specifically for Service Provider business requirements which
can capture communications at scale across a network
enabling the data to be used in Dubber’s own applications or
that of a third party application.
1.
Adjusted revenue definition set out on page 20.
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DUBBER ANNUAL REPORT FY23 | 9
The Company’s vision is that AI will become a standard feature
of a telecommunications network.
The Dubber Platform is able to summarise a call of any length
into valuable insights such as action items; a capability which
has the potential to revolutionise the telecommunications
sector for all demographics, addressing opportunities for the
total addressable market of a network customer base.
‘Dubber Moments’ was launched in May to the Company’s
global service provider partners. ‘Moments’ is a range of
‘out-of-the-box’ AI insights delivered in consumable data
points and dashboards. Initial customers have been deployed
As AI continues
its unrivalled
globalisation journey,
Dubber is uniquely
placed to play a
significant role.“
Dubber has not been removed from any network to which it
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pre commercialisation and can access data relating to e.g.
is connected, both of these factors setting up the Company
complaints, ‘voice of customer’ and productivity insights. These
for what we believe to be the inexorable march towards AI for
are the first of many ‘Moments’ that the Company is going to
every telecommunications service, with Dubber at the core.
develop and deliver over coming periods.
Outlook
Key Appointments
The Company has laid down a basic framework with defined
As part of its re-structure, the Company has made several key
revenues and costs base for FY24 based, largely, on its
leadership appointments to bolster its commercial, financial
existing recording based capability. FY24 will, we anticipate, be
and operating team.
the year where the Dubber brand becomes associated more
Neil Wilson as Chairman, Andrew Demery as Chief Financial
Officer and Kimberley Axon as Chief People Officer add
This evolution has always been the Company’s vision, in
important experience, reputation and capability to Dubber’s
line with sector analysts such as Gartner predicting 75% of
leadership structure as we continue to build a globally
business calls will be captured by 2025. Businesses require
with AI than call recording.
significant Company.
Expanding the Dubber Footprint
compliance but all businesses will come to rely on insights.
Dubber is the platform that delivers AI insights from the core
of the communications networks, a data and product set
which, to date has not been available and commercialised
Dubber has a brand and technology which is both proven and
but one which is core to understanding the fundamentals of
trusted in the telecommunications sector as demonstrated
relationships and productivity.
by the migration of recording services for Vodafone in the
UK and Nuuday, the national carrier of Denmark from legacy
As AI continues its unrivalled globalisation journey, Dubber is
offerings. We anticipate further bulk migrations in FY24 as
uniquely placed to play a significant role.
more Communications Service Providers look to use Dubber’s
cloud platform across multiple networks and services.
Acknowledgements
We continue to focus on expanding the network footprint
FY23 has been a dynamic year for the Company and the
and FY23 has seen that footprint reach Central and South
broader economic community. I would like to pass on the
America alongside continued growth in Europe, APAC and
appreciation of the management and the operating team
North America.
to our loyal customers and investors who share the Dubber
vision and, on behalf of the management, I would like to
The continued emergence of global Unified Communications
commend the team who have performed incredibly well
platforms provides more opportunity for Dubber and we
to deliver a set of world class capabilities which should set
have realised significant opportunities in multiple sectors
the Company up for the future and for which we can all be
for Microsoft Teams, for which we have a unique compelling
immensely proud and optimistic.
capability and Cisco with whom we have a unique relationship
with ‘Dubber Go’ as an embedded standard feature of every
Thank you!
Webex Calling subscription. Cisco themselves, have published
that sales of Webex Calling have exceeded 10 million sales
and so both the ‘Foundation’ revenue of these users and,
also the uplift to higher value products will add to Dubber’s
revenue growth in the short term.
Connecting the Dubber Platform to more Communications
Service Provider networks will always be a key goal since we
are the only capability of our kind in those networks and
Steve McGovern
CEO and Managing Director
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About
Dubber
Dubber is a trusted brand in the
telecommunications sector,
deployed by some of the world’s
leading Communications
Service Providers (CSPs) with
the ability to revolutionise
the way CSPs deliver new and
valuable network services to
their customers.
The Company has a vision to turn the communications across
the world’s CSP networks into valuable data. The technology
is a true platform, specifically designed to be delivered
seamlessly from a communications network, at scale, in the
same manner that a CSP delivers its other core services.
By providing content directly from the network Dubber
unlocks the potential for businesses, teams and individuals to
improve the outcome of any conversation via any method of
telecommunication service.
The Dubber Platform is connected to over 205 CSPs globally
plus the world's leading cloud-based IP communication service
platforms, providing their customers with the opportunity to
immediately and automatically enhance areas of productivity,
compliance and customer engagement.
Dubber partners with the world's new and traditional CSPs, by:
• delivering a platform built to mirror the scale of
their networks,
• empowering their substantial sales teams to drive growth,
• being immediately available to any user or service on
their networks.
Our platform is designed for Communications
Service Providers
This technology enables Dubber to securely and scalably
connect any network to the Dubber Platform, which then
allows that provider to switch on a Dubber solution for any
service immediately.
12 | DUBBER ANNUAL REPORT FY23
“ We innovate around
the Moments in
conversations
services, including Mobile networks and all major unified
A key strategic focus for Dubber is partnering with these
end of the Small and Medium Business (SMB) market.
The platform is connected to most types of communications
providers as the gateway to a significant volume of customers
and services carried on their networks, generally with Dubber
communications offerings. Its capabilities and features delivery
value from an enterprise sized business through to the lower
Its strategy, therefore, is to expand the CSP network footprint
and drive revenue generating products and services to the
customers of those networks.
Call Recording → Unified Capture → Conversation
Intelligence
The deployment of the Dubber Platform creates the
opportunity for communications to be captured, at scale,
for any ‘end point’ which lends itself to the opportunity for
network based cloud call recording for which the Company
has created products and services which, to date, represent
the majority of its revenues.
becoming a unique partner to address those customers needs
We have customers who need call recording as a stand
with the services we provide. Ultimately, these providers carry
alone product. The Dubber Platform enables a broad range
the world's communications content and it is our goal that
of capability delivered, at scale, directly from the source of the
our current and expanding conversation intelligence capability
calls, the network.
can deliver innovation to the core offerings of these partners,
impact their customers today and create an expanding source
‘Dubber Go’ is an example of a general commercial
of future growth.
At Dubber, we innovate around Moments
in conversations
requirement for records of interactions which can be switched
on immediately for individual users directly from Cisco
Webex Calling.
CSPs also have the capability to offer a comprehensive
As the world's leading platform to capture and record
compliance recording service which enables their financial
conversations for partnering CSPs, Dubber has taken an
institutions to expand their capability from contact centre
innovative approach to the capture of the conversation data
to mobile and business phones and buy it directly from
and called it Dubber Moments.
their CSP.
We’ve built and designed Moments aligned to specific
As a singlely operated, multi-tenanted Platform which is
themes, and through these themes deliver comprehensive
connected to multiple telecommunications and networks IP
solutions that appeal to broad areas of business. This
based communications platform, a core advantage for Dubber
appeal can be served by the large sales teams of our global
is its ability to provide Unified Capture (Recording) across
Partners, with Moments packaged to enhance their existing
multiple networks and/or Providers enabling the customer to
customer opportunities with a relatively easy to buy, sell and
have a ‘single pane of glass’ view of its recordings, for example
provision approach.
it could view its mobile and business line calls in one place or,
indeed, its Cisco Webex and Microsoft Teams calls.
Moments are focussed on speed of delivery and creating
immediate benefit for the customer, without bespoke AI
The Company is now able to deliver unique AI capabilities to
configurations. Moments can impact both large enterprises
those networks to provide Conversation Intelligence which
and SMBs across most of their communications methods. To
provides additional layers of revenue via existing recording
achieve this on a global scale and accommodating regional
users and also, due to the nature of the products, opens up a
variations in regulation, language, privacy and security,
broader range of customers across those deployed networks.
Dubber now has a platform that is AI enabled and capable
of delivering new releases of moments, covering increasing
business and consumer requirements, on a regular basis.
Data Analytics
Core Strategy for Growth
Dubber's longer term growth can be achieved off back of
the potentially substantial repository of data contained in
the platform from the recordings and AI insights, either
The Company is able to rely on two key
through its own continuing development of product or by
commercial advantages;
the customers using the data to drive outcomes via third
Its platform is invariably the only capability of its type
integrated at the core of a network.
party applications.
Dubber expects to realise the potential benefits of this
strategy in FY24 following the successful completion and
There is negligible churn at either a CSP or end user customer
deployment of its AI capability and has structured its business
level due to the nature of the services.
to deliver and support that strategy.
DUBBER ANNUAL REPORT FY23 | 13
ABOUT DUBBER Moments
Revolutionising Communication
USE CASE | CONSTRUCTION
Leading construction industry supplier
transforms Customer Service,through uncovering
valuable insights into delivery challenges
The Challenge
The Solution
A large enterprise catering to both
By implementing Dubber's
major and niche construction firms
conversation capture across all their
grappled with escalating customer
brands and activating the Moment
grievances and slumping sales.
designed to identify complaints topics,
managers were able for the first time
Conventional methods for complaint
see a comprehensive analysis of the
analysis proved tedious and time
complaints across all the calls.
consuming and fell short in delivering
the essential insights necessary for
They now review the results daily to
targeted issue resolution and the
identify the root cause of all complaints
elevation of customer experiences.
and implement immediate actions to
resolve issues. Leveraging predictive
analysis, they've further unearthed
a probable surge in delivery-related
complaints anticipated in the weeks
preceding Christmas.
Theme Voice of customer
Moment Complaints
Solution Unified Communication Contact Centre
USE CASE | RETAIL
Major retailer transforms Employee Wellbeing, reducing
response time to abusive calls from four weeks to mere hours
The Challenge
The Solution
Within a retail giant that predominantly
By implementing Dubber's conversation
employs young women, distressingly
capture across all retail outlets
frequent incidents of sexually or
and activating the Moment designed
emotionally abusive phone calls have
to flag abusive calls, store managers
marred the work environment.
achieved real-time feedback following
The critical process of identifying
and assisting those affected has,
This transformative approach markedly
regrettably, extended well beyond a
enhanced the organisation's ability to
any such incident.
4-week timeframe.
swiftly identify affected individuals and
significantly reduced the time required
to provide them with essential support.
Theme Voice of customer
Moment Abuse
Solution Fixed Line
14 | DUBBER ANNUAL REPORT FY23
ABOUT DUBBER
Early Adopter Use Cases
USE CASE | AUTOMOTIVE
An automotive powerhouse transforms Sales Performance,
through identifying opportunities to improving employee
sales effectiveness and implementing targeted training
The Challenge
The Solution
At the core of a prominent automotive
By implementing Dubber's conversation
powerhouse, which offers an array of
capture across all their network and
services, lies a fundamental reliance
activating multiple Moment’s designed
on every single employee within their
to identify attempts to close sales and
expansive network. Irrespective of
complaints, managers were able to get
their position, each employee has the
a better understanding as to the quality
responsibility of actively engaging with
of conversations employees were
customers calling their stores to deliver
having with customers.
a service that ultimately culminates in
successful sales.
With this data they strategically
implemented tailored training
Conventional methods of accessing
programs. These initiatives enhanced
the caliber of these conversations was
the calibre of customer interactions,
costly and ineffective, as they merely
with the outcome a notable upswing
sampled a small fraction of the total
in sales and improvement in overall
customer engagements.
customer service.
Themes Voice of customer, Sales Performance
Moments Complaints, Sales Close
Solution Partners Unified Communication Service
USE CASE | GOVERNMENT
A local government enhances Customer Service Support,
through a deeper understanding of service requests for
informed council program initiatives
The Challenge
The Solution
Local councils manage diverse
By implementing Dubber's conversation
community and business sectors,
capture across all their network
including healthcare, education, and
and activating the Moment’s designed
community initiatives. They receive
to categorise customer service
a large volume of calls across
requests and complaints, managers
these areas, crucially influencing
were able to get a better understanding
program usage and perception, and
which areas are receiving calls and the
evaluating information and support
context of the service request.
effectiveness.
With insights and service topic trends
The challenge lies in the inability to
enables more efficient allocation of
thoroughly capture and investigate
funding and resourcing and influences
these calls, making it complex
new initiatives and programs of work
to allocate new programs or
across the council departments.
determine suitable areas for self-
service initiatives.
Theme Voice of customer
Moments Complaints, Call Categorisation
Solution Unified Communication
DUBBER ANNUAL REPORT FY23 | 15
ABOUT DUBBER Directors’
Report
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Directors
Directors have been in office since the start of the financial year to the date of this report unless
otherwise stated.
Steve McGovern
CEO & Managing Director
Neil Wilson
Non-Executive Chairman (appointed 14 February 2023)
Peter Pawlowitsch
Executive Director
Gerard Bongiorno
Non-Executive Director
Sarah Diamond
Non-Executive Director (appointed 9 August 2022)
Peter Clare
Non-Executive Chairman (until 14 February, then Non-Executive Director until 28
February 2023 when his resignation became effective)
Corporate structure
Dubber Corporation Limited is a limited liability company that is incorporated and domiciled in Australia.
Dubber Corporation Limited has prepared a consolidated financial report incorporating the entities that it
controlled during the financial year as follows:
Dubber Corporation Limited
Medulla Group Pty Ltd
Dubber Pty Ltd
Dubber Ltd
Dubber USA Pty Ltd
Dubber, Inc.
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parent entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
Dubber Connect Australia Pty Ltd
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100% owned controlled entity
CallN Pty Ltd
Dubber UK Holdings Ltd
Aeriandi Ltd
Voxygen Ltd
Pinch Labs, Inc
Pinch Labs Pty Ltd
Principal activities
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100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
The principal continuing activities of Dubber Corporation Limited and its controlled entities consisted
of the provision of unified call recording and conversation Artificial Intelligence services to the global
telecommunications industry.
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OPERATING AND FINANCIAL REVIEW Operating
and Financial
Review
The group has three main operating segments, specifically
for the provision of subscriptions services in Europe, United
States of America, Central and Latin America (‘Americas’) and
Rest of World (including Australia).
The Group runs a single integrated technology platform which is predominantly developed and maintained in Australia
and used by all three regions to provide services to customers. The Europe segment contains the acquired Speik
technology platform that provides support for legacy products provided to a subset of European customers. The Group’s
head office is in Melbourne, Australia and provides management and back-office services for the Group. Each segment
operates a sales function addressing the region.
DUBBER ANNUAL REPORT FY23 | 19
OPERATING AND FINANCIAL REVIEW The directors believe the additional unaudited non-Australian Accounting Standards (AAS) measures included
in this report are relevant and useful in measuring the financial performance of the Group. In particular, the
presentation of Adjusted Recurring Revenue, and Adjusted Operating loss before depreciation, amortisation,
interest and tax, which are all non-AAS measures, provides useful additional measures to assess the
performance of the Group.
Revenue
Overall, revenue grew 84% in FY23 to $30,029,811 (FY22: $16,317,595). Excluding the variable revenue reversal
of $8,160,943 in FY22 (which relates to periods prior to FY22) adjusted revenues grew by 23%.
Europe
$
Americas
$
Rest of world
$
Total
$
FY23 Revenue
20,383,189
6,977,299
2,669,323
30,029,811
Adjusted Growth on FY22*
21%
38%
3%
23%
* Growth rate excludes variable revenue reversal of $8.1m in the Rest of world segment recorded in FY22 – see note 2.
Europe Revenues grew 21% in FY23 to $20,383,189, reflecting strong volume growth in end user volumes
across a number of Tier 1 CSPs in the UK, along with commencement of the migration of Vodafone’s recording
customer base from a legacy service to Dubber in the second half of the year with the full benefit to be realised
in FY24.
A number of new CSP agreements were signed, additional networks for existing partners were enabled and
continuing migrations of legacy call recording bases have been agreed and the continuing expansion of
requirements for Microsoft Teams and other CSP networks have started to contribute towards the end of the
Financial Year.
Americas revenues grew 38% to $6,977,299 in FY23, which combined solid volume growth through existing
Foundation partners with a range of new revenue generating network providers and enterprise customers.
Cisco, as the Group’s key foundation partner, ramped up the activation of Webex-Cloud users across the
year, which includes a licence for Dubber Go within each Webex activation. The Group also saw increased
penetration of Dubber premium recording products to Cisco users. Microsoft Teams Service Provider
requirements continued to expand in this region also as end user customers seek to unify their user experience
across multiple platforms.
Rest of world adjusted revenues were up slightly to $2,669,323 being 3% higher than FY22. By the end of FY23
the Telstra sales teams for their Unified Communications service TiPT had been activated and the Dubber
Platform has been integrated natively into Optus mobile network with results to be experienced from FY24
and beyond.
Revenue in the second half of FY23 was $16,352,264 (H1 FY23: $13,677,547), a 20% increase on the first half of
FY23 reflecting an accelerating revenue growth rate on higher customer service activations in the second half.
Operating expenses
Direct costs increased by 21% to $13,741,020 (FY22: $11,373,421) reflecting higher cloud usage and related
costs in line with adjusted revenue growth and an investment in resilience and fault tolerance on the core
Dubber Platform. A significant programme of upgrade work has been undertaken across the Dubber Platform in
respect of optimising the efficiency and scalability of the platform which is expected to allow for further service
volume and revenue growth with much lower direct cost increases, increasing direct margins achieved.
Salaries and related expenses were $52,784,896 (FY22: $40,353,791), up 31% on FY22. This reflected higher
average headcount across FY23 than FY22, and consequently higher staff related costs such as travel and
amenities that are linked to headcount. Employee share based payments reduced 69% to $5,976,446 (FY22:
$19,144,919) reflecting significantly lower value of share based incentive instruments granted to employees in
the year and the KMP Long Term Incentive plan that concluded at 30 June 2023 was only 50% achieved, and
therefore the expense recognized was lower than in FY22.
20 | DUBBER ANNUAL REPORT FY23
OPERATING AND FINANCIAL REVIEW General and administration costs decreased 16% to $17,265,867 (FY22: $20,499,299) reflecting a reduction in
outsourced product development costs in FY23, offset partly by higher overheads and marketing costs in FY23.
The Group significantly invested in increasing headcount during FY22 to develop the next generation of
Artificial Intelligence products and upgrade the core Dubber platform to support the growth aspirations and
the expected revenue growth rate from Communications Service Providers at the time. Upon completion of
the material elements of the technology platform upgrades and the initial AI products, the Group announced a
restructuring programme in February 2023 in line with focus on supporting its core strategies.
The restructuring programme is expected to deliver approximately $20m of annualised cost savings, through
reduced headcount, optimising the Group’s cloud infrastructure and other IT related savings and reducing
variable and discretionary spend including marketing, travel & related expenses. These cost savings have
been largely achieved by 30 June 2023, with over $12m of annualized run-rate savings achieved in Q4 FY23 vs
Q2 FY23.
As a result, the Group recorded losses before depreciation, amortisation, interest and tax of $58,228,298 (FY22:
$75,885,715), a reduction in loss of 23% on FY22. On an adjusted basis, operating loss before depreciation,
amortisation, interest and tax (excluding the variable revenue reversal of $8,160,943 in FY22) reduced by 14% in
FY23.
Other Income and Expense
Finance income grew 400% to $1,116,068 (FY22: $222,819) with higher average cash balances on deposit
in FY23.
Finance costs decreased 60% to $794,783 (FY22: $1,997,535) reflecting a specific finance cost of $896,996
incurred in FY22 in respect of deferred consideration for the Speik acquisition which occurred in FY21 and
which was settled in FY22.
Depreciation and amortisation was up 16% to $8,399,494 per P/L (FY22: $7,260,706) reflecting a full year of
depreciation on Right-of-Use assets for the Group’s property leases of which a number were entered into part
way through FY22.
The Group recognised goodwill impairment charges of $3,679,449 in FY23 (FY22: $nil) of which $3,505,000
relates to the Europe segment.
FY23 Income tax benefit was $789,384 (FY22: $816,458) reflecting a remeasurement in deferred tax liabilities for
changes in future tax rates and availability of tax losses to offset the deferred tax liabilities.
As a result, the Group recorded a loss after income tax of $69,196,571 (FY22: $84,104,679), a reduction in
loss of 18% on FY22. On an adjusted basis, loss after income tax (excluding the variable revenue reversal of
$8,160,943 in FY22 and the FY23 goodwill impairment of $3,679,449) reduced by 14% in FY23.
Cashflows
The Group recorded operating cash receipts from customers of $36,146,911 (FY22: $29,926,312), up 21% on
FY22, which was in line with the increase in adjusted revenue. Net cash outflows used in operations were 19%
higher than FY22 at $50,179,674 (FY22: $42,205,948) reflecting the higher cash based expenses (excluding
non-cash share based payments) incurred in the year. The increase in revenues in the second half of the year
drove record cash collections of $10.2m in Q4 FY23, and alongside the benefits of the announced restructuring
programme starting to be achieved reduced net cash operating outflows in Q4 FY23 to $8.4m, which was 47%
lower than the operating cash outflow of $16.0m in Q3 FY23.
The Group had $2,862,626 of cash and cash equivalents at 30 June 2023, in addition to $30,000,000 of cash
at call in an interest bearing term deposit (classified as Other Receivables at 30 June 2023). In addition, as a
subsequent event the Company issued 46,371,531 shares on 2 August 2023 to raise $6,492,000 (net of issue
costs), and a further 19,314,184 shares on 12 September 2023 raising $2,456,000 (net of issue costs) post
shareholder approval at an EGM on 6 September 2023.
DUBBER ANNUAL REPORT FY23 | 21
OPERATING AND FINANCIAL REVIEW FY24 Expected Revenue Build Components (AUD$)
5
45
3
1
6
36
5
30
25
)
m
$
(
t
n
e
n
o
p
m
o
C
e
u
n
e
v
e
R
50
45
40
35
30
25
20
15
10
5
0
FY22
Reported
Revenue
FY23
Revenue
Growth
FY23
Reported
Revenue
FY23
exit run-rate
annualisation
FY23
exit run-rate
revenue
FY24
Committed
revenues
Foundation
Partner
Revenue
uplift
FY24
expected
organic
revenue
growth
FY24
expected
revenue
Outlook
The Company reiterates its expectations for FY24 provided to the ASX on 19 June 2023.
The business continues to focus on accelerating the current recurring revenue growth rate through its organic
customer uptake and expansion, as well as the realisation of the contract value of its new and expanded
CSP agreements.
For FY24, the Company expects revenues of $45m in FY24 (an uplift of approximately 50% on the FY23 reported
revenue), entering FY25 with an annualised run rate in excess of $50m.
The Company has confidence in the expected $45m of FY24 revenues based on the activities in progress to
support the above revenue build components.
The Company has forward visibility of approximately $3m in incremental, committed annual recurring revenues
for FY24 from Tier 1 Communications Service Provider contracts agreed in the FY23 financial year.
Foundation partner revenues are expected to grow by at least $1m over FY24. As a key Foundation partner,
Cisco Systems has announced in excess of 10 million sales of Webex Calling subscriptions, each of which will
include a ‘Dubber Go’ subscription as a standard feature. This provides substantial opportunity for growth
in Dubber Go deployments and further revenues as those subscriptions are upgraded to Dubber’s higher
revenue products.
The remaining $5m of revenue growth is consistent with the rate of revenue growth from FY22 to FY23 and is
anticipated to be delivered through compounding existing CSP volume growth and further growth from the
launch of the Dubber AI suite.
22 | DUBBER ANNUAL REPORT FY23
OPERATING AND FINANCIAL REVIEW
The Company’s cost reduction program through its restructure of operations, announced to ASX on 28 February
2023, remains on track to deliver $5m of quarterly cash cost savings by Q1 FY24, with an additional $3m of
savings above the initial restructuring programme to be realised over FY24.
As a result, the Company expects to incur $65m of costs in FY24 (excluding share-based payment expenses,
impairment and FX gains/losses), down from $88m in FY23, with costs being broadly flat over the course of FY24
(excluding any timing impacts of working capital).
The Company expects net operating cash outflows to be $20m or less for FY24, with a closing cash balance in
the range of $20-23m at 30 June 2024, including the expected net proceeds of $9.6m from the capital raise
undertaken in July 2023, of which $6.1m was received in the first tranche in August 2023 with the balance of
$3.5m approved by shareholders at an EGM of 6 September 2023.
The Company’s cost base is in place to support revenue growth above the expected $45m in revenue for FY24,
with recurring revenue being largely independent of that cost base. The Company has flexibility to manage the
cost base in response to changes in trading conditions without impacting the expected revenue. Consequently,
the Company’s primary focus is to drive revenue growth and manage resources and costs to achieve its target
of cashflow breakeven in FY25, assuming no material changes to trading conditions or strategy.
The Company’s cloud infrastructure costs can support significantly expanded usage volume and revenues for its
core recording and platform business with higher gross margins expected as utilisation grows.
The Company expects to achieve both gross margin and operating margin expansion across FY24 as revenues
grow and the Company delivers further technical efficiency and benefits from increasing economies of scale.
Dividends
No dividends were paid or declared during the year. No recommendation for payment of dividends has
been made.
Significant changes in the state of affairs
Significant changes in the state of affairs of the Company during the financial year are detailed in the review
of operations.
In the opinion of the directors, there were no other significant changes in the state of affairs of the Company
that occurred during the financial year under review not otherwise disclosed in this report or in the
financial statements.
Events subsequent to reporting date
The Company issued 46,371,531 shares on 2 August 2023 to raise $6,492,000 (net of issue costs) and a further
46,421,531 shares on 12 September to raise $2,456,000 (net of costs) as part of the capital raise announced
in July 2023. The Company also issued 1,510,619 shares to satisfy option exercises under the Company’s ESOP
plan between 1 July 2023 and the date of this report.
Aside from the above, no other matters or circumstances have arisen since the end of the financial year.
Likely developments and expected results of operations
The Group will continue to pursue its principal activity of rolling out and developing its cloud- based call
recording and AI solutions platform.
DUBBER ANNUAL REPORT FY23 | 23
OPERATING AND FINANCIAL REVIEW Material business risks
The Company and Group are subject to risks of both a general nature and ones that are specific to its
business activities including, but not limited to the following:
Growth and Profitability (dependent on increasing market penetration)
The Company continues to trade in a loss-making position, incurring operating cash outflows as it strives to
achieve positive operating cash flows through growth.
Dubber’s future growth and profitability is dependent on continuing to increase the usage of its products
across a wide range of Network Service Providers and end-users. A failure to continue to innovate and add new
functionality to its platforms, and to operate its platforms at a standard that will retain clients and attract new
clients could lead to Network Service Providers and end-users not renewing their engagement with the platform
which could adversely impact Dubber’s financial performance and/or operations. If the Company is not able to
grow revenues and cash receipts, reduce operating costs or obtain additional financing as needed, it may be
required to reduce the scope of its operations and may be prevented from progressing the commercialisation
of its technology.
Reliance on third party platforms and operating systems
The Company’s products and services are intended for use across a number of internet access platforms,
mobile and desktop devices and software operating systems. The Company depends on the ability of its
products and services to operate on such platforms, devices and operating systems however it cannot control
the maintenance, upkeep and continued supply of effective service from external suppliers in these areas. Any
changes in such platforms, operating systems or devices that adversely affect the functionality of the Company’s
products and services or give preferential treatment to competitive products and services could adversely affect
usage of the Company’s products and services.
Reliance on access to and confidence in telecommunications and the internet
The Company generally depends on the ability of the end consumer and its customers to access a deployed
solution over telecommunications and internet access and to feel confident in the utilisation of the Company’s
platform. A failure in either of these services, which may be beyond the control of the Company, is likely to have
adverse financial consequences for the Company.
Hosting provider disruption risk
The Company relies on its primary hosting providers Amazon Web Services and Microsoft Azure to store all data
gathered from its customers. Should Amazon Web Services or Microsoft Azure suffer outages, for example due
to catastrophic destruction following a natural disaster, service to the Company’s products and services may
also be disrupted. If Amazon Web Services or Microsoft Azure ceased to offer their services to the Company and
no replacement service is uncovered quickly, this could lead to a disruption of the Company’s products and/
or services.
Continued and uninterrupted provision of products and services
The Company employs a team of technicians and engineers along with automated redundancy capability for
the continued and uninterrupted operation of the Company’s products and services. A failure in the continued
delivery of products and services could lead to the Company being in breach of contractual obligations and
covenants to its clients and customers, which may lead to significant penalties or contract termination, that in
turn could lead to significant claims against the Company and significant losses and damage to the Company’s
brand and reputation.
Satisfying increasing demand for products and services
As the Company and demand for its products and services grow, there is a risk that the Company will not be
able to satisfy the requirements of all of its clients and customers and deliver promised outcomes.
This may lead to customer dissatisfaction and significant penalties or contract termination, which in turn could
lead to significant claims against and losses for the Company and substantial damage to the Company’s brand
and reputation.
24 | DUBBER ANNUAL REPORT FY23
OPERATING AND FINANCIAL REVIEW International business risks
The Company has operations internationally, notably in the USA, UK, Europe, Australia and New Zealand.
Wherever the Company sets up operations it is exposed to a range of multi-jurisdictional risks such as risks
relating to labour practices, environmental matters, difficulty in enforcing contracts, changes to or uncertainty in
the relevant legal and regulatory regime (including in relation to taxation and foreign investment and practices
of government and regulatory authorities) and other issues in foreign jurisdictions in which the Company
operates. Businesses that operate across multiple jurisdictions face additional complexities from the unique
business requirements in each jurisdiction.
Inability to execute on sales targets
There is a risk Dubber does not achieve its sales targets due to inadequate execution of its strategy.
Furthermore, if Dubber fails to innovate and add new functionality to its platforms, and to operate its platforms
at a standard that will retain clients and attract new clients, then there is a risk that the sales targets will not
be achieved. This inability to execute on sales targets could negatively impact upon the Company’s reputation,
revenues and profitability.
Regulatory and compliance risk
The Company operates in a complex regulatory environment and in jurisdictions that have varying degrees of
enactment and implementation of regulations and are constantly evolving to meet challenges associated with
new technology, including the General Data Protection Regulation (EU) 2016/679, or GDPR, in the European
Union and similar laws and regulations in the United Kingdom. A failure to comply with, or adjust to variations
of, regulatory requirements both in Australia and overseas may result in the Company facing regulatory
investigation and/or significant claims, and/or being required to adapt or withdraw certain products, which may
adversely affect the Company’s revenues.
A number of the Company’s clients and customers operate in the financial services sector in a number of
jurisdictions (both in Australia and overseas) that are subject to stringent and complex regulations. A failure of
the Company to comply with the requirements of these clients and customers could lead to significant claims
against the Company by both customers and regulators, which may lead to significant losses and damage to the
Company’s brand and reputation.
In addition, the Company’s platforms and products are, or will, be offered in many different jurisdictions,
many of which are developing nations that may not have a well-developed or enforced regulatory structure in
the relevant sectors. Changes to laws and regulations or the way such laws and regulations are interpreted,
implemented or enforced may affect the Company’s platforms or products in those jurisdictions or the ability of
the Company or its partners to conduct business in those jurisdictions.
Data loss, theft or corruption
The Company stores data with a variety of third party service providers and cloud computing service providers.
Hacking or exploitation of some unidentified vulnerability in its network could lead to loss, theft or corruption of data.
Although the Company has strategies and protections in place to try and minimise security breaches and
to protect data, these strategies might not be successful. In that event, it could negatively impact upon the
Company’s revenues and profitability.
Misuse of the Company’s products and services
Users of the Company’s call recording and related products and services are subject to standard terms and
conditions of use which state that a user must protect the privacy and details contained within a recording and
is liable if the products and services are used unlawfully.
Although Dubber has strategies and protections in place to minimise misuse of recordings, there is no
guarantee these strategies will be successful in the event a person uses the Company’s products and services in
an unlawful manner. In the event of misuse, this may result in adverse publicity, litigation, regulatory enquiries in
respect of state and federal privacy and surveillance legislation and reducing the use of the Company’s products
or services. If this occurs it may negatively affect the Company’s revenues.
DUBBER ANNUAL REPORT FY23 | 25
OPERATING AND FINANCIAL REVIEW Cybersecurity breaches
The Company, its hosting providers, and networks are required to adhere to their own and customers’ security
and compliance standards. If adequate safeguards and measures to mitigate breaches are not provided
and maintained, it could negatively impact upon the Company’s reputation, revenues and profitability. If the
Company’s security measures are breached, or if its products are subject to cyber-attacks that expose or restrict
customer access to the platform or their data, its solutions may be perceived as less secure than competitors
and customers may stop using the Dubber platform.
Growth and inability to integrate new acquisitions
There is a risk that the Company may be unable to manage its future growth successfully. Dubber’s growth
strategy includes the targeted acquisition of complimentary businesses to integrate into its existing operations.
Such acquisitions can create integration risk, pricing risk, reputational risk and a variety of other issues including
disaffected clients, directors and employees of the acquired business. Depending on the nature of the
acquisition, acquisitions can also represent illiquid or mid- to-long term investments before a return is realised,
if at all.
These issues can potentially have adverse consequences from a strategic, financial and/or operational
perspective. The Company will draw on its past experience to mitigate the risks within the control of the
Company, such as seeking to retain key acquired staff within the combined business.
Potential future funding issues
Dubber’s ability to effectively implement its business strategy over time may also depend in part on its ability to
raise additional funds. There can be no assurance that any such equity or debt funding will be available to the
Company on favourable terms or at all. If adequate funds are not available on acceptable terms, the Company
may not be able to take advantage of opportunities or otherwise respond to competitive pressures.
Intellectual property
The Company’s business relies on its ability to protect its intellectual property and any improvements to it.
The intellectual property may not be capable of being legally protected, may be the subject of unauthorised
disclosure, may be unlawfully infringed or the Company may incur substantial costs in protecting its intellectual
property rights.
In addition, the Company utilises open source software in a number of its products and will use other open
source software in the future. The terms of many open source software licenses to which the Company will
be subject have not been interpreted by Australian or foreign courts, and there is a risk that open source
software licenses could be construed in a manner that imposes unanticipated conditions or restrictions on the
Company’s ability to provide or distribute its products.
Competition
The Company operates in an industry which is very competitive and subject to rapid and significant change.
Competitors may be pursuing the development of products that target the same customers as the Company.
The Company’s products may compete with existing products already available to customers. The Company may
face competition from competitors with substantially greater resources. Competing products may be superior
to the Company’s products, which would adversely impact the commercial viability of the Company’s products
Dependence upon key personnel
The Company depends on the talent and experience of key personnel to deliver on its business strategy. If key
personnel leave, it may be difficult to replace them, or to do so in a timely manner or at a comparable expense.
Any key personnel who leave to work for a competitor may adversely impact the Company. Additionally,
increases in recruitment, wages and contractor costs may adversely impact upon the financial performance of
the Company.
26 | DUBBER ANNUAL REPORT FY23
OPERATING AND FINANCIAL REVIEW Meetings of directors
The numbers of meetings of directors and the relevant committee meetings held during the year and the
numbers of meetings attended by each director were as follows:
Director
Mr Steve McGovern
Mr Neil Wilson
Mr Peter Pawlowitsch
Mr Gerard Bongiorno
Ms Sarah Diamond
Mr Peter Clare
Board Meetings
Audit Committee
Meetings
Remuneration
and Nomination
Committee Meetings
Number
eligible
to attend
Attended
Number
eligible
to attend
Attended
Number
eligible
to attend
Attended
15
6
15
15
15
10
15
6
15
15
13
10
*
-
*
3
3
2
*
-
*
3
2
1
*
-
*
1
1
1
*
-
*
1
1
1
* Reflects not a member of that Committee
The Audit and Remuneration and Nomination Committees were formalised on the appointment of Sarah
Diamond on 9 August 2022 which is when the Company had three non-Executive Directors' capable of forming
an independent Audit and Remuneration and Nomination Committee. The Committees formally commenced
operation after the 2022 AGM in November 2022 and the meetings above reflect Committee meetings held
from that date to 30 June 2023.
DUBBER ANNUAL REPORT FY23 | 27
OPERATING AND FINANCIAL REVIEW Environmental,
Social and
Governance
“ ESG is a cornerstone element of
As part of our global growth agenda, we recognise
the importance of integrating ESG considerations into
our operations and decision-making processes. Our
approach to sustainability underpins how we operate
to ensure we meet increasing societal and investor
expectations, play our part in mitigating global warming
and provide a framework to drive forward the company’s
progress in this area.
building a long-range business.”
economic, environmental, and social impacts.
– Steve McGovern
development of our sustainability framework and will continue
to do so when reporting in the future against our significant
In order to define our key environment, social and governance
(ESG) and sustainability objectives, Dubber engaged a
third-party sustainability specialist to undertake a detailed
materiality analysis for the business. The materiality
Dubber’s sustainability strategy includes key environmental,
and external stakeholder issues of importance, and an
social and governance actions and targets. The plan covers
evaluation of their business impact. The outcomes from this
all our operations, regions and facilities directly owned or
analysis has directly shaped the ambition and focus of our
assessment process included a review of both internal
managed by Dubber. The targets and progress toward them
sustainability strategy.
will be reviewed annually. In addition to ensuring long-term
value creation for our stakeholders, our ESG strategy is
Dubber’s ESG Strategy aligns with, and supports delivery of
an expression of our commitment to sustainability, social
the aspirations of key ESG Frameworks. These include: UN
responsibility, and ethical practices.
Sustainable Development Goals, The UN Global Compact,
Stakeholder Engagement and
Materiality Analysis
Sustainability Accounting Standards Board (SASB), Task Force
on Climate-Related Financial Disclosure (TCFD), ASX Corporate
Governance Principles and Recommendations, Science-Based
Target Initiative (SBTi) and The Climate Pledge.
Dubber has a number of key stakeholders groups. These are
our shareholders/investors, customers and business partners,
Through our materiality analysis, and in consultation with
key stakeholders, we have identified seven key pillars
employees, suppliers, governments and regulators and
underpinning our ESG strategy. These pillars are aligned with
nongovernmental organizations (NGOs). We have considered
the ESG frameworks indicated above and include: Information
the expectations and interests of stakeholders in the
Security and Data Privacy, Ethical Artificial Intelligence (AI),
28 | DUBBER ANNUAL REPORT FY23
OPERATING AND FINANCIAL REVIEW Gender diversity — Male / Female %
Male
Female
Board
Senior Executives
Workforce
Equity, Diversity and Inclusion (EDI), Employee Engagement,
Community Engagement, Climate Change & Governance
• Maintained Dubber’s ISO27001 certification with
continuous improvements to Dubber’s ISMS.
and Reporting.
2023 Highlights
Information Security and Data Privacy
Equity, Diversity and Inclusion
As a global technology company, we recognise the importance
of embedding equity, diversity and inclusive values into
everything we do, to ensure a diverse and skilled workforce
and a workplace characterised by inclusive practices and
Looking after the data of our customers, our suppliers, our
behaviours for the benefit of all staff. We aspire to have
partners and our people, is one of Dubber’s top priorities. We
diversity throughout the business but have a particular focus
hold a strong commitment to embedding data privacy and
on supporting the representation of women at the senior level
security into every facet of our business. Over the course of
of Dubber and on the Dubber Board. We have taken steps to
the last year, Dubber launched multiple initiatives to increase
increase diversity in our workforce including:
our security posture including:
• The Dubber Trust Centre;
• Uplift in our Supply Chain Risk reviews to include checks for
Supplier Ethical Sourcing and Modern Slavery Practices; and
• Implementation of the Global Leave Policy including Primary
& Secondary Parental Leave to ensure equitable leave
across our regions of business;
DUBBER ANNUAL REPORT FY23 | 29
OPERATING AND FINANCIAL REVIEW • Increased Female Board representation to 20% through
the potential dramatic societal and environmental risks
welcoming Sarah Diamond to Dubber’s Board of
of climate change and are committed to measuring and
Directors; and
mitigating our impacts in this area.
• Are at Initial stages of forming Diversity, Inclusion &
Belonging Committee.
Our scope 1 and 2 greenhouse gas (GHG) emissions were
measured for the first time in FY21/22. Emissions for the
year were 77tCO2e (market-based method), and this
The Company has set measurable objectives for gender
forms the baseline against which future performance is
diversity from FY20 onwards at a 5-year company-wide target
measured. During the most recent financial year emissions
of 25% women and a long-term target of 50% women.
increased 55% as a result of business growth and in
Employee Engagement
Culture is at the forefront of what we do at Dubber and our
commitment to ensuring that Dubsters are engaged can be
seen through multiple avenues of engagement and employee
support. We are clear that engagement links directly to
performance and above all else we want to be sure Dubber is
a great place to work. To support this, we have implemented:
• Psychological Safety Training for all staff;
• Mental Health Awareness training for staff;
• Pilot Hybrid Working Policy;
• Launched the Dubber Learning & Development Hub; and
• Embedded an annual global Employee Engagement Survey,
using this initial data to then hold global focus groups
with 20% of overall headcount represented, ensuring we
understood the engagement feedback.
particular new offices in Brisbane, Sydney and Oxford. Going
forward, electricity emissions will be reduced through grid
decarbonisation and use of renewable electricity.
Emission source
FY21/22
(tCO2e)
FY22/23
(tCO2e)
Scope 1: Gas
2.9
10.3
Scope 2:
Electricity (location-based)
Scope 2:
Electricity (market-based)
84.0
104.1
74.1
109.1
TOTAL Scope 1 & 2 emissions
(market-based)
77.0
119.4
Priorities for FY24
In respect of ESG, Dubber is focusing on the following areas
over FY24:
Community Engagement
Extensive charity engagements are already taking place at a
local level, with employees and teams of employees taking
Diversity & Inclusion
part in sponsorship challenges and other fundraising activities.
Providing an inclusive workplace that has fair policies and
At a Group level, the focus of our support has been Save a
practices in place that enables a diverse range of people to
Child’s Heart, to which we have made significant donations
work together effectively.
for several years running. Additionally, in supporting mental
health with our employees, we have also engaged and have
created a partnership with Livin. Livin is a charity focusing
Employment/Employee Engagement
on mental health education programs, designed to break
Refreshing Group policies and procedures for recruitment,
the stigma surrounding mental health and promote positive
training/skills development, flexible working, pay & benefits,
mental health in team environments.
succession planning, attraction & retention, wellbeing and
mental health.
Governance & Reporting
Our Board recognises the importance of maintaining high
Customer Security/Data Privacy
standards of corporate governance and is committed to
Meeting compliance requirements. Safeguarding customer
fostering a culture of integrity across our business.
data, preventing breaches.
Progress in the year has been:
• ESG Policy implemented; and
• Appointed an overall sustainability lead and pillar leads to
manage all key focus areas.
Climate Change
As a software company with limited physical resources, our
overall environmental impact is low. Regardless, we recognise
Business Ethics/Governance
We are in the process of forming our ESG Committee made
up of pillar leads and sustainability lead. Demonstrating high
standards of regulatory governance and compliance, including
ESG related policies.
30 | DUBBER ANNUAL REPORT FY23
OPERATING AND FINANCIAL REVIEW Year in review – snaps of our team from across the globe.
DUBBER ANNUAL REPORT FY23 | 31
OPERATING AND FINANCIAL REVIEW Board of
Directors
The particulars of the qualifications,
experience and special responsibilities
of each director are as follows:
Mr Neil Wilson
Non-Executive Chairman
Mr Steve McGovern
CEO and Managing Director
Mr Peter Pawlowitsch
Executive Director
Experience
Mr Wilson is an experienced business
Experience
Experience
Mr McGovern is a founder of
Mr Pawlowitsch holds a Bachelor of
leader and entrepreneur with
Dubber Pty Ltd. He has over 25
Commerce from the University of
corporate, start-up, founder and
years’ experience in the fields of
Western Australia, is a current member
public company experience. He holds
telecommunications, media sales,
of the Certified Practicing Accountants
a Bachelor of Business degree and is
pay TV and regulatory and a Law
of Australia, a Fellow of the Governance
a FCPA and Member of the Australian
Degree from Sheffield University. Mr
Institute of Australia and holds a
Computer Society.
McGovern has been a senior executive
Master of Business Administration from
of several established companies,
Curtin University.
Neil holds a number of high profile
both domestically and internationally,
technology and sport administration
which have been primarily associated
These qualifications have underpinned
roles, including being the current Chair
with new and emerging markets and
more than fifteen years’ experience in
of the Victoria Racing Club and held the
have required a strong sales and
the accounting profession and more
position of Managing Director and Chief
solutions focus.
Executive Officer of Oakton Limited
until its acquisition by Dimension Data
in 2014. He has extensive experience
across the digital and technology
domain and a strong focus on the
value of data and information for
organisations and is considered a
thought leader in this area.
recently in business management
and the evaluation of businesses
and projects.
Interest in Shares and
Options/Rights at the date
of this report
Interest in Shares and
Options/Rights at the date
of this report
Interest in Shares and
Options/Rights at the date
of this report
• None
• 9,836,242 ordinary shares held
• 5,368,937 ordinary shares held
directly and indirectly
indirectly
• 1,535,108 ZEPOs held directly or
• 808,851 ZEPOs held indirectly
indirectly
Directorships held in other listed
entities in the past three years
Directorships held in other listed
entities in the past three years
Directorships held in other listed
entities in the past three years
• Non-Executive Director of Knosys
• Linius Technologies Limited
• VRX Silica Limited (February 2010 –
Ltd (December 2020 – present)
(April 2016 – July 2023)
present)
• Knosys Limited (March 2015 –
December 2021)
• Novatti Group Limited (June 2015 –
present)
• Qoria Limited (September 2019 –
present)
32 | DUBBER ANNUAL REPORT FY23
OPERATING AND FINANCIAL REVIEW Mr Gerard Bongiorno
Non-Executive Director
Ms Sarah Diamond
Non-Executive Chairman
Mr David Franks
Company Secretary
Experience
Mr Bongiorno is Principal and Co-CEO
Experience
Ms Diamond is a seasoned executive
Experience
Mr Franks has been appointed as the
of Sapient Capital Partners, a merchant
with deep experience in the financial
Company Secretary since 15 March
banking operation and has over 35
services, technology, consulting and
2023 following the retirement of Ian
years of professional experience in
regulatory sectors most notably as
Hobson. Mr Franks is a Principal of
capital raisings and corporate advisory.
Global Managing Director, Financial
the Automic Group. He is a Chartered
Prior to forming Sapient (formerly
Services at IBM. She has a MA in
Accountant, Fellow of the Financial
Otway Capital), Gerard was Head
Modern History from Oxford University
Services Institute of Australia, Fellow of
of Property Funds Management at
and a MA in International Relations
the Governance Institute of Australia,
Challenger Financial Services Group
from John Hopkins. She is currently
Justice of the Peace, Registered
(CFG) and was Group Special Projects
an Executive Mentor for the ExCo
Tax Agent and holds a Bachelor of
Manager at Village Roadshow. Earlier
Group, a global firm of experienced
Economics (Finance and Accounting)
in his career he worked at KPMG in
CEOs, independent directors and
from Macquarie University. With
insolvency and corporate Finance.
global business leaders who specialise
over 30 years’ experience in finance,
Gerard received his Bachelor’s Degree
in leadership, an independent non-
governance and accounting, he has
in Economics and Accounting from
executive board member of Quantexa,
been CFO, company secretary and/or
Monash University and the Program for
and a mentor to the Columbia
director for numerous ASX listed and
Management development at Harvard
University Executive Master of Science
unlisted public and private companies,
Business School PMD75.
in Technology Management program.
in a range of industries covering energy
retailing, transport, financial services,
mineral exploration, technology,
automotive, software development
and healthcare.
Interest in Shares and
Options/Rights at the date
of this report
Interest in Shares and
Options/Rights at the date
of this report
• 796,723 ordinary shares
• 96,988 RSUs held directly
held indirectly
• 600,000 remuneration options
• 51,641 ZEPOs held indirectly
held indirectly
• 300,000 remuneration options
held indirectly
Directorships held in other listed
entities in the past three years
Directorships held in other listed
entities in the past three years
• Linius Technologies Limited
(February 2017 – present)
• None
DUBBER ANNUAL REPORT FY23 | 33
OPERATING AND FINANCIAL REVIEW Remuneration
Report
34 | DUBBER ANNUAL REPORT FY23
REMUNERATION REPORT The remuneration report details the key management personnel remuneration arrangements for
the consolidated entity, in accordance with the requirements of the Corporations Act 2001 and
its Regulations.
The information provided in the Remuneration Report has been audited in accordance with 300A of the
Corporations Act 2001.
Key management personnel are those persons having authority and responsibility for planning, directing and
controlling the activities of the entity, directly or indirectly, including all directors.
The following persons were directors of Dubber Corporation Limited during the financial year:
Steve McGovern
Peter Clare
Neil Wilson
Peter Pawlowitsch
Gerard Bongiorno
Sarah Diamond
CEO & Managing Director
Non-Executive Chairman (resigned 28 February 2023)
Non-Executive Chairman (appointed 14 February 2023)
Executive Director
Non-Executive Director
Non-Executive Director (appointed 9 August 2023)
Other persons that fulfilled the role of a key management person during the year, are as follows:
Peter Curigliano
Andrew Demery
Russell Evans
Andrew Lark
Steve Willson
James Slaney
Chief Financial Officer (resigned from role 10 October 2022)
Chief Financial Officer (appointed 8 February 2023)
Chief Revenue Officer
Chief Marketing Officer (resigned 31 January 2023)
Chief Technology Officer
Chief Operating Officer
Overview of Remuneration Policies
The Board as a whole is responsible for considering remuneration policies and packages applicable
both to directors and executives of the Consolidated Entity.
The Remuneration and Nomination Committees were formalised on the appointment of Sarah Diamond on 9
August 2022 which is when the Company had three non-Executive Directors capable of forming an independent
Remuneration and Nomination Committee. The Committee formally commenced operation after the 2022 AGM
in November 2022 and from that date took the primary responsibility for considering remuneration policies and
packages applicable both to directors and executives and making recommendations to the Board in respect
of remuneration.
Key management personnel have authority and responsibility for planning, directing and controlling the
activities of the Company and the Consolidated Entity, including directors of the Company and other executives.
Broadly, remuneration levels for key management personnel of the Company and of the Consolidated Entity
are competitively set to attract and retain appropriately qualified and experienced directors and executives
and reward the achievement of strategic objectives. The current remuneration policies and structures were
set through a Board implemented independent review of remuneration policies which came into effect from
1 July 2020. The review also included recommendations on the design and operation of short-term and
long-term incentive plans for the Company’s executives. The independent review and related remuneration
policy implemented from 1 July 2020 was followed and this is the third and final year of this plan. A new
KMP remuneration plan is being developed and will be introduced separately which will be effective for the
FY24 financial year commencing 1 July 2023. The details of this remuneration plan will be communicated to
shareholders once the plan is completed.
There were no remuneration consultants engaged during the year.
RELATIONSHIP BETWEEN THE REMUNERATION AND COMPANY PERFORMANCE
The remuneration policy has been tailored to increase goal congruence between shareholders, directors and
executives. Two methods have been applied to achieve this aim, the first being a performance-based rights
DUBBER ANNUAL REPORT FY23 | 35
REMUNERATION REPORT
subject to performance based vesting conditions, and the second being the issue of options or shares to key
management personnel to encourage the alignment of personal and shareholder interests.
SUMMARY OF REMUNERATION POLICIES FOR FY23
Remuneration packages for Executive KMPs can consist of fixed remuneration (including base salary, employer
contributions to superannuation funds), non-cash benefits, and variable incentives including short term and
long term incentives payable in cash or equity.
The Company has a variable remuneration package for directors, which includes fixed fees as well as short
term incentives (STI) and long term incentives (LTI). STIs incentives are broadly linked to the delivery of annual
operational objectives while LTIs focus on the delivery of strategic objectives and creation of sustainable
shareholder value.
Short term incentives and associated performance targets are set annually by the Board. For FY23, each KMP
was set a series of personal objectives covering financial, operational, product, sales and other core business
objectives, as well as specific personal objectives. Performance is measured against these objectives at the end
of the financial year.
For FY23, short term incentive remuneration is payable by way in cash or STI ZEPOs, subject to Shareholder
approval where required.
Long term incentives were set for three years by the Board and are linked to delivery of the Group’s business
plan and subject to continued employment. Achievement over the life of the Remuneration Policy (i.e. within
that three year period) is measured against the performance targets set for the LTI programme that runs from 1
July 2020 to 30 June 2023 which were:
• achieved recurring revenue targets; and
• targets for agreements in place for the deployment of the Dubber call recording service on
telecommunication networks.
Long term incentive remuneration is payable in equity only in the form of LTI ZEPOs.
NON-EXECUTIVE DIRECTORS
Total remuneration for all non-executive directors, last voted upon by shareholders at the 2014 Annual General
Meeting, is not to exceed $500,000 per annum and has been set at a level to enable the Company to attract and
retain suitably qualified directors. The Company does not have any scheme relating to retirement benefits for
non-executive directors.
FIXED REMUNERATION
Fixed remuneration consists of base remuneration (which is calculated on a total cost basis and includes
any FBT charges related to employee benefits including motor vehicle), as well as employer contributions to
superannuation funds.
Remuneration levels are reviewed annually by the Board through a process that considers individual, segment
and overall performance of the Consolidated Entity. The Board has regard to remuneration levels external to
the Consolidated Entity to ensure the directors’ and executives’ remuneration is competitive in the marketplace.
Executive directors are employed full time or part time and receive fixed remuneration in the form of salary and
statutory superannuation or consultancy fees, commensurate with their required level of services.
Non-Executive directors, unless otherwise specified by any non- executive and consultancy service agreement
in place, receive a fixed monthly fee for their services. Where non-executive directors provide services materially
outside their usual Board duties, they are remunerated on an agreed retainer or daily rate basis.
There were no increases to fixed remuneration for any KMP during FY23.
36 | DUBBER ANNUAL REPORT FY23
REMUNERATION REPORT SERVICE AGREEMENTS
It is the Consolidated Entity’s policy that service agreements for key management personnel are unlimited in
term but capable of termination on up to 6 months’ notice and that the Consolidated Entity retains the right to
terminate the service agreements immediately, by making payment equal to 6 months’ pay in lieu of notice.
The service agreement outlines the components of compensation paid to key management personnel but does
not prescribe how remuneration levels are modified year to year. Remuneration levels are reviewed annually
on a date as close as possible to 30 June of each year to take into account key management personnel’s
performance. Certain key management personnel will be entitled to bonuses as the Board may decide in its
absolute discretion from time to time.
A summary of key service agreement terms are as follows:
Steve McGovern
CEO & Managing Director
Agreement type:
Executive Service Agreement
Agreement commenced: 1 July 2020
Term of Agreement:
3 year minimum term to 30 June 2023, then rolling with 6 month termination notice
Remuneration:
Annual salary of $501,500 plus statutory superannuation.
Termination notice:
The Company may terminate the agreement on six months written notice. If notice
of termination is given more than 6 months from the end of the initial term, then
employment shall be deemed to be terminated on the last day of the initial term.
Neil Wilson
Non-Executive Chairman
Agreement type:
Letter of appointment
Agreement commenced: 13 February 2023
Term of Agreement
No fixed term
Remuneration:
Annual fee of $120,000 (inclusive of superannuation) and reimbursement of all
reasonable expenses incurred in performing the Non-Executive Chairman’s duties.
Termination notice:
None specified
Peter Pawlowitsch
Executive Director
Agreement type:
Executive Service Agreement
Agreement commenced: 1 July 2020
Term of Agreement
3 year minimum term to 30 June 2023, then rolling with 6 month termination notice
Remuneration:
Annual salary of $144,658 plus statutory superannuation, plus reimbursement of
all reasonable expenses incurred in performing the Executive Director’s duties. Mr
Pawlowitsch also acted as Interim Chief Financial Officer from 10 October 2022
to 28 February 2023 and received a temporary increase in base salary during this
period as compensation.
Termination notice:
The Company may terminate the agreement on 6 months written notice. If notice
of termination is given more than 6 months from the end of the initial term, then
employment shall be deemed to be terminated on the last day of the initial term.
Gerard Bongiorno
Non-Executive Director
Agreement type:
Letter of appointment
Agreement commenced: 2 July 2017
Term of Agreement
No fixed term
Remuneration:
Annual fee of $75,000 (inclusive of statutory superannuation) plus reimbursement of
all reasonable expenses incurred in performing the Non-Executive Director’s duties.
Termination notice:
None specified
DUBBER ANNUAL REPORT FY23 | 37
REMUNERATION REPORT James Slaney
Co-Founder And Chief Operating Officer
Agreement type:
Executive Service Agreement
Agreement commenced: 1 July 2020
Term of Agreement
3 year minimum term to 30 June 2023, then rolling with 6 month termination notice
Remuneration:
Annual salary of $415,000 plus statutory superannuation.
Termination notice:
The Company may terminate the agreement on 6 months written notice. If notice
of termination is given more than 6 months from the end of the initial term, then
employment shall be deemed to be terminated on the last day of the initial term.
Andrew Demery
Chief Financial Officer
Agreement type:
Executive Service Agreement
Agreement commenced: 8 February 2023
Term of Agreement
No fixed term
Remuneration:
Annual salary of $422,000 plus statutory superannuation.
Termination notice:
The Company may terminate the agreement on 3 months’ notice, or by providing a
cash payment in lieu of such notice.
Russell Evans
Chief Revenue Officer
Agreement type:
Executive Service Agreement
Agreement commenced: 6 May 2019
Term of Agreement
No fixed term
Remuneration:
Annual salary of $320,000 plus statutory superannuation.
Termination notice:
The Company may terminate the agreement on 3 months’ notice, or by providing a
cash payment in lieu of such notice.
Steven Willson
Chief Technology Officer
Agreement type:
Executive Service Agreement
Agreement commenced: 30 September 2021
Term of Agreement
No fixed term
Remuneration:
Annual salary of $422,500 plus statutory superannuation.
Termination notice:
The Company may terminate the agreement on 6 months’ notice, or by providing a
cash payment in lieu of such notice.
38 | DUBBER ANNUAL REPORT FY23
REMUNERATION REPORT FY23 KMP Statutory Remuneration Details
Short Term Benefits
Long Term
Benefits
Post-
Employment
Share Based
Payments
Year
Salary
and Fees
Cash
Bonus
STI paid
in ZEPOs
Annual
& Long
Service
Leave
Superannuation
Options,
Rights or
Shares
Total
Remuneration
consisting of
options, rights
or shares
Remuneration
based on
performance
$
$
$
$
$
$
$
%
%
Executive Directors:
S McGovern
2023
501,500
2022
501,500
-
-
P Pawlowitsch 2023
308,018
100,000
2022
144,658
Non-Executive Directors:
P Clare
2023
91,250
2022
109,500
N Wilson (a)
2023
45,000
2022
-
G Bongiorno
2023
75,000
2022
75,000
S Diamond
2023
86,215
2022
-
Other Key Management Personnel:
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
60,381
27,500
(e) (573,152)
16,229
(g) n/m
(g) n/m
77,913
27,500
2,049,189
2,656,102
25,689
(e) 280,649
714,356
14,466
1,619,295
1,778,419
77
39
91
77
(g) n/m
91
(f) (547,631)
(456,381)
(g) n/m
(g) n/m
-
-
-
-
-
-
-
-
506,562
616,062
-
-
45,000
-
221,530
296,530
264,939
339,939
44,947
131,162
-
-
J Slaney
2023
415,000
92,000
232,035
49,489
27,500
(e) (95,833)
720,191
2022
429,167
P Curigliano (b) 2023
82,827
2022
302,500
A Demery (c)
2023
167,042
2022
-
-
-
-
-
-
R Evans
2023
320,000
70,144
2022
320,000
91,500
A Lark (d)
2023
256,500
60,000
2022
360,000
120,000
S Willson
2023
422,500
2022
318,552
-
-
-
-
-
42,786
25,000
3,549,222
4,046,175
(5,592)
7,530
105,439
190,204
34,089
27,500
1,548,807
1,912,896
70,333
15,923
11,458
-
-
-
-
264,756
-
-
-
-
-
-
3,019
39,354
75,161
507,678
11,735
30,400
430,905
884,540
(30,138)
20,050
138,657
445,069
30,138
37,150
204,295
751,583
63,000
(17,920)
27,250
60,390
555,220
-
18,520
20,625
139,500
497,197
82
-
-
75
78
34
-
19
88
55
81
27
-
15
49
31
27
22
28
59
-
-
61
53
-
-
14
88
-
-
27
-
14
10
13
16
22
77
Total
2023
2,770,852
322,144
365,368
75,162
186,331
(289,843)
3,430,014
(g) n/m
(g) n/m
2022
2,560,877
211,500
-
215,181
182,641
10,312,714
13,482,913
76
59
a)
b)
c)
d)
e)
f)
g)
N Wilson was appointed Key Management Personnel effective 13 February 2023.
P Curigliano resigned from the role of CFO effective 10 October 2022 and thus ceased to be KMP as of this date.
A Demery was appointed Key Management Personnel effective 8 February 2023.
A Lark resigned from the role as CMO effective 31 January 2023.
S McGovern, P Pawlowitsch and J Slaney all have a negative component to their share based payment expense reflecting a reversal of expense recorded
in FY22 and FY21 against the Long Term Incentive plan achievement of 50% at 30 June 2023 (see page 42).
P Clare resigned on 28 February 2023 and forfeited all unvested share rights and options at that date, resulting in a reversal of the share based
payment expense recorded in FY22 and FY21 against those rights and options.
Items marked (g) shown as not meaningful as the KMP has a negative share based payment expense for the year meaning a negative proportion of
remuneration relates to options or performance.
DUBBER ANNUAL REPORT FY23 | 39
REMUNERATION REPORT ADDITIONAL INFORMATION
We aim to align our executive remuneration to our strategic and business objectives and the creation of
shareholder wealth. The Group has continued to grow its operating revenue over the last financial year. As
outlined in the operating and financial review, growth in revenue in particular annualised recurring revenue is a
key focus of the Group. The table below shows measures of the group’s financial performance over the last five
years as required by the Corporations Act 2001.
These are not necessarily consistent with the measures used in determining the variable amounts of
remuneration to be awarded to KMPs and Directors. As a consequence, there may not always be a direct
correlation between the statutory key performance measures and the variable remuneration awarded.
The earnings of the consolidated entity for the five years to 30 June 2023 are summarised below:
2023
$'000
2022*
$'000
2021
$'000
2020
$'000
2019
$'000
Sales revenue
30,030
16,317
20,337
9,649
5,547
Earnings before depreciation, amortisation,
impairment, interest and tax
(58,228)
(75,885)
(27,348)
(15,691)
(7,933)
Loss after income tax
(69,197)
(84,104)
(31,697)
(18,000)
(9,648)
* Restated – see Note 1 for details.
The factors that are considered to affect total shareholders return (‘TSR’) are summarized below:
2023
$
2022*
$
2021
$
2020
$
2019
$
Share price at financial year end ($)
0.20
0.65
3.09
1.13
0.42
Total dividends declared (cents per share)
-
-
-
-
-
Basic loss per share (cents per share)
(22.53)
(28.22)
(13.25)
(9.30)
(9.19)
* Restated – see Note 1 for details.
40 | DUBBER ANNUAL REPORT FY23
REMUNERATION REPORT Short Term Incentive Outcomes For FY23
The outcomes of the FY23 STI plan for KMPs eligible for an STI is set out below.
STI payable ($)
Payment method
ZEPOs granted
Executive Directors
Steve McGovern
-
Peter Pawlowitsch
100,000
Other KMP
James Slaney
128,650
Steve Willson
Andrew Demery
Russell Evans
63,000
70,333
70,144
Peter Curligiano
-
Andy Lark
60,000
N/A
Cash
ZEPOs
ZEPOs
ZEPOs
Cash
N/A
Cash
N/A
N/A
730,996*
300,000
399,619*
N/A
N/A
N/A
* ZEPOs to be granted after the publication of the FY23 annual report.
Steve McGovern: Mr McGovern under his ESA was entitled to receive a STI under the performance criteria of
his personal scorecard but due to the share price performance of the Company, Mr McGovern in conjunction
with the Board has agreed to waive his STI entitlement in 2023, as he also did in 2022.
Peter Pawlowitsch: Mr Pawlowitsch was required during the year to assume full time responsibilities as
Interim Head of Finance to oversee improvement in the Company’s policies and procedures in the Finance
function and then ensure a smooth transition and appropriate support for the incoming CFO Andrew Demery.
It was decided that Mr Pawlowitsch should receive 100% of his STI for the 2023 financial year, being $100,000.
James Slaney: Mr Slaney was paid a cash payment of $92,000 and granted 492,308 ZEPOs in lieu of his FY22
bonus which was not determined at the time of the FY22 Annual Report. The value of the ZEPOs granted in
March 2023 in respect of FY22 was $103,385 as set out on page 100.
In addition, Mr Slaney received an STI of $128,650 being 62% of his FY23 STI, to be paid as 730,996 ZEPOs.
The number of ZEPOs granted to Mr Slaney in respect of his FY23 STI was determined based on dividing the
notional STI payable by the VWAP for the 30 trading days prior to 30 June 2023 of $0.176. These ZEPOs will be
issued as soon as is practicable after the publication of the FY23 Annual Report.
Andrew Demery: Mr Demery was appointed during Q3 of the financial year and had STI targets associated
with the improvement in policies and procedures and timeliness of reporting within the finance function. It
was decided that Mr Demery should receive 100% of his STI for the 2023 financial year, being $70,333 paid as
399,619 ZEPOs. The number of ZEPOs granted to Mr Demery was determined based on dividing the notional
STI payable by the VWAP for the 30 trading days prior to 30 June 2023 of $0.176. These ZEPOs will be issued as
soon as is practicable after the publication of the FY23 Annual Report.
Steve Willson: Mr Willson has a contractual STI set at the date of his appointment in FY22. Mr Willson did not
achieve the STI conditions to vest the 100,000 ZEPOs for FY23.
Mr Willson received an additional 300,000 ZEPOs during the year as a short term incentive, reflecting his
contribution to the Group. The ZEPOs granted to Mr Willson were during the year were valued at $63,000 as set
out on page 100.
Russell Evans: Mr Evans received cash bonus as calculated per his contract.
Andrew Lark: Mr Lark received cash bonus as calculated per his contract.
DUBBER ANNUAL REPORT FY23 | 41
REMUNERATION REPORT Long Term Incentive Outcomes For FY23
LTI Outcomes for S McGovern, P Pawlowitsch and J Slaney
The LTI ZEPOs achievement was measured at 30 June 2023 for S McGovern, P Pawlowitsch and J Slaney. The
details of the LTI plan that commenced in FY21 are set out below.
If the holder remains in continued employment with the Company until 30 June 2023, the LTI ZEPOs shall vest
as follows:
i.
Recurring revenue (50% of LTI ZEPOs). The following proportions of LTI ZEPOs shall vest where recurring
revenue for the Group by 30 June 2023 is:
A)
at or above $40 million but less than $60 million: 33% at $40 million with a straight-line pro rata
vesting up to 60%;
B)
at or above $60 million but less than $80 million: 60% at $60 million with a straight-line pro rata
vesting up to 100%; and
C)
at or above $80 million: 100%.
Recurring revenue means operating revenue of the Group for any month multiplied by 12 exclusive of one-
off revenue fees such as connection fees and any R&D or other grant revenue.
ii.
Agreements for deployments into telecommunication networks (50% of LTI ZEPOs). The following
proportions of LTI ZEPOs shall vest where, by 30 June 2023, the Group has agreements in place for
the deployment of the Dubber call recording service on to Communications Service Provider networks
(whether or not yet active):
A)
B)
C)
at least 170 but less than 185: 33% at 170 with a straight-line pro rata vesting up to 60%;
at least 185 but less than 200: 60% at 185 with a straight-line pro rata vesting up to 100%; and
at or above 200: 100%.
The achievement against both components of the LTI were as follows:
Measure
Actual Achieved
at 30 June 2023
Percentage
achievement
Pro rata total
LTI Vesting
Recurring Revenue achievement
$36m*
Deployments into telecommunications networks
206
Total LTI Achievement
0%
100%
0%
50%
50%
* Based on annualized run-rate revenue based on June 23 monthly revenue recorded.
As a result 50% of the LTI ZEPOs vest, and 50% of the LTI ZEPOs were forfeit at 30 June 2023.
LTI Outcomes for S Willson
The LTI ZEPOs achievement was measured at 30 June 2023 for S Willson. The details of the LTI plan that
commenced in FY22 in respect of the achievement to be measured in FY23 are set out below.
LTI Performance
Options (Part A)
Continued employment with the Company in existing role in the relevant
financial year.
Proportion vesting is based on recurring revenue level:
Measurement year
Performance
% Vesting
$67m - $75m
FY23
Above $75m - $84m
Above $84m
33%
66%
100%
42 | DUBBER ANNUAL REPORT FY23
REMUNERATION REPORT LTI Performance
Options (Part B)
Continued employment with the Company in existing role in the relevant
financial year.
Proportion vesting is based on numbers of agreements for
telecommunication network deployments (active or not):
Measurement year
Performance
% Vesting
FY23
197-200
201-203
204 or more
33%
66%
100%
Measure
Actual Achieved
at 30 June 2023
Percentage
achievement
Pro rata total
LTI Vesting
Recurring Revenue achievement (Part A)
$36m*
0%
Deployments into telecommunications
networks (Part B)
206
100%
Total LTI Achievement
0%
50%
50%
Details of Incentive Compensation Securities Issued to Key
Management Personnel
An overview of the share based incentive plans operated by the Company are set out as follows:
OPTIONS
The Company operates an Employee Incentive Plan (“EIP”) for executives and employees of the Consolidated
Entity. In accordance with the provisions of the EIP, executives and employees may be granted options (ZEPO
or strike price) to purchase ordinary shares at an exercise price to be determined by the Board with regard to
the market value of the shares when it resolves to offer the options. The options may only be granted to eligible
persons after the Board considers the person’s seniority, position, length of service, record of employment,
potential contribution and any other matters which the Board considers relevant.
Each employee share option converts into one ordinary share of the Company on exercise. No amounts are
paid or payable to the Company by the recipient on receipt of the option. The options carry neither right
to dividends nor voting rights. Options may be exercised at any time from the date of vesting to the date of
their expiry.
The number of options granted is determined by the Board. Typically, options granted under the EIP expire
within thirty-six months of their issue. The options are not exercisable until the vesting date provided the
participant is an employee at the relevant vesting date.
SHARES
The directors, at their discretion, may issue shares to participants under the Employee Share Plan (“ESP”) at any
time, having regard to relevant considerations such as the participant’s past and potential contribution to the
Company, and their period of employment with the Company. Directors of the Company, full- time employees
and part-time employees of the Group who hold a salaried employment or office in the Group, are eligible to
participate in the ESP.
Plan shares may be issued at an issue price to be determined by the Board, which may be a nominal or nil issue
price if so determined by the Board. The number of plan shares issued is determined by the Board.
The plan shares are issued on the same terms as the fully paid ordinary shares of the Company and rank
equally with all of the Company’s then existing shares.
DUBBER ANNUAL REPORT FY23 | 43
REMUNERATION REPORT The Board may impose conditions in an offer of plan shares that must be satisfied (unless waived by the Board
in its absolute discretion) before the plan shares to which the condition applies can be sold, transferred,
assigned, charged or otherwise encumbered.
Where a restriction condition in relation to plan shares is not satisfied by the due date, or becomes incapable
of satisfaction in the opinion of the Board, the Company must, unless the restriction condition is waived by
the Board:
Where the plan shares were issued for no cash consideration, buy back the relevant plan shares within 12
months of the date the restriction condition was not satisfied (or became incapable of satisfaction) at a price
equal to $0.0001 per share; or
Where the shares were issued for cash consideration, use its best endeavours to buy back the relevant
plan shares within 12 months of the date the restriction condition was not satisfied (or became incapable of
satisfaction) at a price equal to the cash consideration paid by the participant for the plan shares.
To date, plan shares offered under the ESP vest in three equal tranches on each of the three consecutive
annual vesting dates. The shares are not issued to the participant until the vesting date provided the participant
is an employee at the relevant vesting date.
44 | DUBBER ANNUAL REPORT FY23
REMUNERATION REPORT Options awarded, vested and lapsed during the year
The table below discloses the number of share options granted, vested or lapsed during the year. Share options do not carry any
voting or dividend rights, and can only be exercised once the vesting conditions have been met.
Vesting
date
Exercise
price
Options
awarded
during the
year
Options
vested
during the
year
Options
lapsed
during the
year
Value of
options
granted in
the year
No.
No.
No.
- 1,535,108 (g) 1,535,107 (g)
-
404,426 (g)
404,425 (g)
-
-
404,426
17,213
96,988 (b)
96,988
Key
Management
Personnel
Financial
year of
award
Type of award Award date
Fair
value per
option
at award
date (a)
$
S McGovern
FY21
LTI ZEPOs
30/11/2020
1.659
30/06/2023
P Pawlowitsch
FY21
LTI ZEPOs
30/11/2020
1.659
30/06/2023
FY21
LTI ZEPOs
23/07/2021
3.199
30/06/2023
G Bongiorno
FY22
S Diamond
FY23
FY23
Remuneration
ZEPOs
Remuneration
RSUs
Remuneration
Options
23/07/2021
3.199
30/06/2023
21/11/2022
0.350
30/06/2023
21/11/2022
0.049
30/06/2024
1.75
600,000 (b)
P Clare
FY22
NED ZEPOs
23/07/2021
3.199
30/06/2023
FY22
NED ZEPOs
23/07/2021
3.199
30/06/2024
0
0
FY22
FY22
FY22
Remuneration
Options
Remuneration
Options
Remuneration
Options
23/07/2021
2.026
30/06/2024
1.75
23/07/2021
1.977
30/06/2024
1.75
23/07/2021
1.899
30/06/2024
1.75
-
-
-
-
-
J Slaney
FY21
LTI ZEPOs
8/06/2021
2.919
30/06/2023
FY23
STI ZEPOs
15/03/2023
0.210
15/03/2023
- 1,122,211 (g) 1,122,210 (g)
492,308 (c)
492,308
50,000 (d)
50,000
A Lark
FY23
FY23
R Evans
FY22
S Willson
FY23
Remuneration
ZEPOs
Remuneration
Options
Remuneration
ZEPOs
Remuneration
ZEPOs
31/01/2023
0.395
30/06/2023
31/01/2023
0.185
30/06/2023
0.444
250,000 (d)
250,000
13/05/2022
0.915
30/09/2022
15/03/2023
0.210
30/06/2023
-
125,000
300,000 (e)
300,000
FY22
STI ZEPOs
30/09/2021
1.234
30/06/2023
FY22
LTI ZEPOs
30/09/2021
1.234
30/06/2023
FY22
LTI ZEPOs
30/09/2021
1.234
30/06/2023
-
-
-
-
-
100,000 (h)
50,000 (i)
50,000
-
-
-
-
-
29,678 (f)
29,679 (f)
200,000 (f)
200,000 (f)
200,000 (f)
-
-
-
-
-
-
-
-
-
-
-
$
-
-
-
-
33,946
29,220
-
-
-
-
-
-
103,385
19,750
46,275
-
63,000
-
-
-
$
0
0
0
0
0
0
0
0
0
0
0
0
0
a)
b)
c)
d)
e)
f)
g)
h)
i)
Determined at the time of grant per AASB 2. For details on the valuation of the options, including models and assumptions used refer to the
financial statements.
The RSUs vested on 30 June 2023. The Options shall vest on 30 June 2024 if the holder remains as a director of the Company as at that date, or in
certain cases of prior departure if the Board exercises its discretion otherwise in accordance with the 2020 Plan. There are no additional performance
conditions in respect of the RSU or option grants. The expiry date for the RSUs and ZEPOs is 31 July 2024.
ZEPOs granted to J Slaney in lieu of FY22 STI as set out on page 41.
The ZEPOs and options were granted under Mr Lark’s service contract and vested at during the financial year. The expiry date for the ZEPOs is 30
June 2026.
ZEPOs granted to S Willson in respect of revised FY23 STI as set out on page 41. The expiry date for the ZEPOs is 31 March 2026.
ZEPOs and Options lapsed upon ceasing to be a Director.
Relates to achievement of FY23 measured LTI as set out on page 42.
Relates to achievement of contractual FY23 STI as set out on page 41.
Relates to achievement of FY23 measured LTI as set out on page 42.
DUBBER ANNUAL REPORT FY23 | 45
REMUNERATION REPORT
Additional Disclosures
Relating to Key
Management Personnel
SHAREHOLDINGS
The number of shares in the Company held during the financial year by each director and other members of key
management personnel of the Consolidated Entity, including their personally related parties, is set out below:
Key Management
Personnel
Balance at start
of Year
Received as
Remuneration
Options
Exercised
Acquired/
disposed
Net Change
Other (a)
Balance at
End of Year
S McGovern
9,836,242
N Wilson
-
P Pawlowitsch
4,964,511
G Bongiorno
796,723
S Diamond
-
P Clare
J Slaney
772,953
4,653,388
P Curligiano
667,090
A Demery
A Lark
R Evans
-
-
100,000
S Willson
85,000
Total
21,875,907
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
404,426
-
-
-
-
-
-
-
-
-
-
-
-
29,678
(202,631)
(600,000)
9,836,242
-
5,368,937
796,723
-
-
492,308
349,511
-
5,495,207 (b)
-
-
-
275,000
-
-
(667,090)
-
280,753
-
-
-
-
-
-
-
280,753
-
375,000
85,000
1,201,412
427,633
(1,267,090)
22,237,862
a)
b)
Balance of shareholding at date of ceasing to be a KMP/retirement.
Includes an amount of 4,325,135 shares that have been transferred as collateral for a personal loan. The shares remain
beneficially owned by Mr Slaney or a related entity as at 30 June 2023.
46 | DUBBER ANNUAL REPORT FY23
REMUNERATION REPORT OPTION HOLDINGS
The number of options over ordinary shares in the Company held during the financial year by each director
and other members of key management personnel of the Consolidated Entity, including their personally related
parties, is set out below:
Key
Management
Personnel
Balance
at Start
of Year
Received as
Remuneration
Options
Exercised
Intrinsic
Value
S McGovern
3,070,215
N Wilson
-
P Pawlowitsch
1,617,702
G Bongiorno
351,641
-
-
-
-
S Diamond
-
696,988
Options
Expired/
Lapsed
(1,535,107)
-
-
-
-
-
(404,426)
$214,346
(404,425)
-
-
-
-
-
-
P Clare
689,035
-
(29,678)
$23,000
(659,357)
J Slaney
2,244,421
492,308
(492,308)
$83,692
(1,122,210)
P Curligiano
350,000
A Demery
-
-
-
A Lark
850,000
300,000
-
-
-
-
-
-
R Evans
775,000
-
(275,000)
$26,625
-
-
-
-
S Willson
416,500 (b)
300,000
-
-
(150,000)
Net Change
Other (a)
Balance at
end of Year
Number
vested and
exercisable
Unvested
-
-
-
-
-
-
-
(350,000)
-
(1,150,000)
-
-
1,535,108
1,535,108
-
-
808,851
808,851
-
-
-
351,641
34,426
317,215
696,988
96,988
600,000
-
-
1,122,211
1,122,211
-
-
-
-
-
500,000
500,000
-
-
-
-
-
566,500
366,500
200,000
Total
10,364,514
1,789,296 (1,201,412)
$347,663 (3,871,099)
(1,500,000)
5,581,299
4,464,084
1,117,215
a)
a)
Reflects balance of options at the date the person ceased to be a KMP.
Restated from the FY22 Annual Report to reflect 183,500 options that lapsed in FY22.
OTHER TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL
Telephony services totaling $2,193 (2022: $2,195) were provided by Canard Pty Ltd, a company associated with
Mr Steve McGovern. Trade payables at 30 June 2023 include a balance of $183 (30 June 2022: $1,095) payable
to Canard Pty Ltd. Intelligent Voice and 1300 MY SOLUTION are businesses associated with Mr Steve McGovern.
The Group earned service fee income of $38,281 (2022: $58,844) from Intelligent Voice and $28,959 (2022:
$57,511) from 1300 MY SOLUTION.
All transactions are conducted on normal commercial terms and on an arm’s length basis.
This concludes the remuneration report, which has been audited.
DUBBER ANNUAL REPORT FY23 | 47
REMUNERATION REPORT Other Directors’
Report Disclosures
SHARE OPTIONS AND ORDINARY SHARES
There were 15,845,222 unissued ordinary shares of Dubber Corporation Limited under option outstanding at
30 June 2023 with further details set out in Note 23 to the financial statements. A further 1,390,619 shares were
issued from 1 July 2023 to the date of this report and no additional share options were granted for a total of
14,454,603 unissued ordinary shares of Dubber Corporation Limited under option outstanding at the date of
this report.
No person entitled to exercise the options had or has any right by virtue of the option to participate in any
share issue of the Company or of any other body corporate. The directors’ interests in equity and other holdings
are outlined in the remuneration report and the amounts shown and numbers held are the same at 30 June
and the date of the Directors’ report.
INDEMNITY AND INSURANCE OF OFFICERS
The Group has during the financial year, in respect of each person who is or has been an officer of the Group or
a related body corporate, made a relevant agreement for indemnifying against a liability incurred as an officer,
including costs and expenses in successfully defending legal proceedings.
Since the end of the financial year, the Group has paid premiums to insure all directors and officers of the
Group, against costs incurred in defending any legal proceedings arising out of their conduct as a director or
officer of the Group, other than for conduct involving a wilful breach of duty or a contravention of sections
232(5) or (6) of the Corporations Act 2001, as permitted by section 241A (3) of the Corporations Act 2001.
Disclosure of the premium amount is prohibited by the insurance contract.
INDEMNITY AND INSURANCE OF AUDITOR
To the extent permitted by law and professional regulations, the Company has agreed to indemnify its auditors,
EY, as part of the terms of its audit engagement agreement against claims by third parties arising from the audit
but excluding any claims which are finally determined to have resulted from EY’s negligent, wrongful or wilful
acts of omissions. No payment has been made to indemnify EY during or since the financial year.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied for leave of Court to bring proceedings on behalf of Dubber Corporation Limited
or intervene in any proceedings to which Dubber Corporation Limited is a party for the purpose of taking
responsibility on behalf of Dubber Corporation Limited for all or any part of those proceedings.
Dubber Corporation Limited was not a party to any such proceedings during the year.
ENVIRONMENTAL REGULATIONS
The Group is not currently subject to any specific environmental regulation under Australian Commonwealth or
State law.
CORPORATE GOVERNANCE STATEMENT
The directors and management are committed to conducting the business of Dubber Corporation Ltd in an
ethical manner and in accordance with the highest standards of corporate governance. Dubber Corporation
Ltd has adopted and has substantially complied with the ASX Corporate Governance Principles and
Recommendations (Fourth Edition) (‘Recommendations’) to the extent appropriate to the size and nature of the
Group’s operations.
48 | DUBBER ANNUAL REPORT FY23
REMUNERATION REPORT The Corporate Governance Statement, which sets out the corporate governance practices that were in
operation during the financial year and identifies and explains any Recommendations that have not been
followed, which is approved at the same time as the Annual Report can be found at www.dubber.net/investors/
investor-centre
ROUNDING OF AMOUNTS
The Company is of a kind referred to in Corporations Instrument 2016/191, issued by the Australian Securities
and Investments Commission, relating to ‘rounding-off’. Amounts in this report have been rounded off in
accordance with that Corporations Instrument to the nearest thousand dollars, or in certain cases, the
nearest dollar.
NON-AUDIT SERVICES
There were no amounts paid or payable to the auditor for non-audit services provided during the year by the
auditor other than those outlined in Note 17 to the financial statements.
AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration for the year ended 30 June 2023, as required under section 307C of the
Corporations Act 2001, has been received and is included within the financial report.
AUDITOR
Ernst and Young continues in office in accordance with section 327 of the Corporations Act 2001.
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the
Corporations Act 2001.
On behalf of the directors
Neil Wilson
Chairman
20 September 2023
DUBBER ANNUAL REPORT FY23 | 49
REMUNERATION REPORT Auditor's
Independence
Declaration
50 | DUBBER ANNUAL REPORT FY23
AUDITOR'S INDEPENDENCE DECLARATION AUDITOR'S INDEPENDENCE DECLARATION
DUBBER ANNUAL REPORT FY23 | 51
A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation Ernst & Young 8 Exhibition Street Melbourne VIC 3000 Australia GPO Box 67 Melbourne VIC 3001 Tel: +61 3 9288 8000 Fax: +61 3 8650 7777 ey.com/au Auditor’s independence declaration to the directors of Dubber Corporation Limited As lead auditor for the audit of the financial report of Dubber Corporation Limited for the financial year ended 30 June 2023, I declare to the best of my knowledge and belief, there have been: a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; b. No contraventions of any applicable code of professional conduct in relation to the audit; and c. No non-audit services provided that contravene any applicable code of professional conduct in relation to the audit. This declaration is in respect of Dubber Corporation Limited and the entities it controlled during the financial year. Ernst & Young David Petersen Partner 20 September 2023 AUDITOR'S INDEPENDENCE DECLARATION Financial
Report
52 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
Dubber Corporation Limited
Revenue
Direct costs
Revenue less Direct Costs
Note
2023
$
2022 (Restated)
$
2 (a)
30,029,811
16,317,595
(13,741,020)
(11,373,421)
16,288,791
4,944,174
Other income
2 (b)
87,901
89,929
Salaries and related expenses
(52,784,896)
(40,353,791)
Employees share based payments
General and administration costs
Foreign exchange gains/(losses)
Earnings before depreciation, amortisation, impairment,
interest and tax
Finance income
Finance costs
Impairment of goodwill
23
2 (c)
2 (c)
(5,976,446)
(19,953,211)
(17,265,867)
(20,499,299)
1,422,219
(113,517)
(58,228,298)
(75,885,715)
1,116,068
222,819
(794,782)
(1,997,535)
(3,679,449)
-
Depreciation and amortisation
(8,399,494)
(7,260,706)
Loss before income tax expense
(69,985,955)
(84,921,137)
Income tax benefit
3
789,384
816,458
Loss after income tax expense for the year
(69,196,571)
(84,104,679)
Other comprehensive loss
Items that may be reclassified to profit or loss
Foreign currency translation differences
864,913
(1,516,524)
Other comprehensive profit / (loss) for the year, net of tax
864,913
(1,516,524)
Total comprehensive loss attributable to owners of Dubber
Corporation Limited
(68,331,658)
(85,621,203)
Loss per share attributable to the owners of
Dubber Corporation Limited
Cents
Cents
Basic and diluted loss per share
15
(22.53)
(28.22)
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes.
DUBBER ANNUAL REPORT FY23 | 53
FINANCIAL REPORT CONSOLIDATED STATEMENT OF FINANCIAL POSITION
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Total Current Assets
Non-Current Assets
Property, plant and equipment
Rights of use asset
Intangible assets
Other assets
Total Non-Current Assets
Total Assets
LIABILITIES
Current Liabilities
Trade and other payables
Lease liability
Provisions
Contract liabilities
Total Current Liabilities
Non-Current Liabilities
Lease liability
Provisions
Contract liabilities
Deferred Tax Liabilities
Total Non-Current Liabilities
Total Liabilities
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
Note
2023
$
2022 (Restated)
$
4
5
6
8
7
9
8
10
11
8
10
11
3
12
13
14
2,862,626
54,383,974
36,963,255
36,691,462
39,825,881
91,075,436
2,010,286
2,870,209
8,585,666
10,407,559
38,039,864
43,473,762
837,577
627,578
49,473,393
57,379,108
89,299,274
148,454,544
15,228,203
11,866,070
2,526,287
2,017,863
1,479,283
1,498,724
5,541,221
3,952,172
24,774,994
19,334,829
6,839,818
9,264,706
743,435
455,787
1,389,342
1,269,694
2,342,693
2,881,824
11,315,288
13,872,011
36,090,282
33,206,840
53,208,992
115,247,704
281,020,797
273,468,060
26,446,677
26,841,555
(254,258,482)
(185,061,911)
53,208,992
115,247,704
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
54 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
2023
Issued Capital
$
Reserves
$
Accumulated
Losses
$
Total
$
Balance at 1 July 2022
273,468,060
26,841,555
(185,061,911)
115,247,704
Loss after income tax expense for the year
Other comprehensive loss for the year, net of tax
Total comprehensive loss for the year
-
-
-
-
(69,196,571)
(69,196,571)
864,913
-
864,913
864,913
(69,196,571)
(68,331,658)
Transactions with owners in their capacity as owners:
Securities issued during the year
7,552,737
(7,236,237)
Cost of share based payments
-
5,976,446
-
-
316,500
5,976,446
Balance at 30 June 2023
281,020,797
26,446,677
(254,258,482)
53,208,992
2022 (Restated)
Balance at 1 July 2021
136,947,992
22,288,243
(100,957,232)
58,279,003
Loss after income tax expense for the year
Other comprehensive loss for the year, net of tax
Total comprehensive loss for the year
-
-
-
-
(84,104,679)
(84,104,679)
(1,516,524)
-
(1,516,524)
(1,516,524)
(84,104,679)
(85,621,203)
Transactions with owners in their capacity as owners:
Securities issued during the year
140,870,068
(13,883,375)
Capital raising costs
(4,350,000)
-
Cost of share based payments
-
19,953,211
-
-
-
126,986,693
(4,350,000)
19,953,211
Balance at 30 June 2022
273,468,060
26,841,555
(185,061,911)
115,247,704
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
DUBBER ANNUAL REPORT FY23 | 55
FINANCIAL REPORT CONSOLIDATED STATEMENT OF CASH FLOWS
Cash flows from operating activities
Note
Receipts from customers
2023
$
2022 (Restated)
$
36,146,911
29,926,312
Payments to suppliers and employees
(86,855,954)
(72,716,527)
Interest received
Government grants received
1,116,100
222,781
127,113
378,455
Interest and other finance costs paid
(713,844)
(16,969)
Net cash outflows used in operating activities
22
(50,179,674)
(42,205,948)
Cash flows from investing activities
Payments for asset acquisition*
-
(6,950,121)
Purchase of plant and equipment
(740,845)
(3,096,284)
Payment of security bond and funds held in trust**
-
(30,177,748)
Return of security bond and funds held in trust
1,063,283
-
Net cash outflows provided by / (used in) investing activities
322,438
(40,224,153)
Cash flows from financing activities
Proceeds from issue of shares
Payment of share issue costs
316,500
110,447,996
-
(4,477,000)
Principal elements of lease liability
(2,247,034)
(963,527)
Net cash (used in) / provided by financing activities
(1,930,534)
105,007,469
Net (decrease) / increase in cash held
(51,787,770)
22,577,368
Cash and cash equivalents at the beginning of the year
54,383,974
32,041,224
Effect of exchange rate changes on cash
266,422
(234,618)
Cash and cash equivalents at the end of the year
4
2,862,626
54,383,974
*Consideration paid for asset acquisition includes non-cash component of 386,277 ordinary shares at $3.75/share ($1,448,539).
**$30m cash invested in a term deposit at a AA3 rated financial institution with a 31 day call back.
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
56 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT Notes to the Consolidated
Financial Statements
1. Summary of Significant Accounting Policies
CORPORATE INFORMATION
Dubber Corporation Limited (“Company” or “Parent Entity”) is a company limited by shares, incorporated and domiciled in
Australia. These consolidated financial statements and notes represent those of Dubber Corporation Limited and controlled
entities (“Group” or “Consolidated Entity”). The nature of the operations and principal activities of the Group are described in the
Directors’ Report.
BASIS OF PREPARATION
The financial report is a general-purpose financial report that has been prepared in accordance with Australian Accounting
Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards
Board and the Corporations Act 2001. Dubber Corporation Limited is a for- profit entity for the purpose of preparing
financial statements.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report
containing relevant and reliable information about transactions, events and conditions. The financial statements and notes also
comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial
report are presented below and have been consistently applied unless otherwise stated.
The financial reports have been prepared on an accruals basis and are based on historical costs, modified, where applicable, by
the measurement at fair value of selected non-current assets, financial assets and financial liabilities.
The separate financial statements of the parent entity, Dubber Corporation Limited, have not been presented within this financial
report as permitted by the Corporations Act 2001. See note 24 for further details on the parent company’s financial information.
These financial statements are presented in Australian dollars, rounded to the nearest dollar.
New or amended Accounting Standards and Interpretations adopted
The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board (‘AASB’) that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
DUBBER ANNUAL REPORT FY23 | 57
FINANCIAL REPORT New Australian Accounting Pronouncements
The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of
the Group’s financial statements are disclosed below. The Group intends to adopt these new and amended standards and
interpretations, if applicable, when they become effective. Group does not expect them to have a material impact.
Accounting policies
and estimates
AASB 2021-2 Amendments
to AASB 108 – Definition of
Accounting Estimates
Effective for annual reporting
periods beginning on or after 1
January 2023
An accounting policy may require items in the financial statements to be measured
using information that is either directly observable, or estimated. Accounting
estimates use inputs and measurement techniques that require judgements and
assumptions based on the latest available, reliable information.
The amendments to AASB 108 clarify the definition of an accounting estimate,
making it easier to differentiate it from an accounting policy. The distinction is
necessary as their treatment and disclosure requirements are different. Critically, a
change in an accounting estimate is applied prospectively whereas a change in an
accounting policy is generally applied retrospectively12.
The new definition provides that ‘Accounting estimates are monetary amounts in
financial statements that are subject to measurement uncertainty.’ The amendments
explain that a change in an input or a measurement technique used to develop an
accounting estimate is considered a change in an accounting estimate unless it is
correcting a prior period error.
The amendments are applied prospectively. Earlier application is permitted. This is
not expected to have a material impact.
Classification of
liabilities
AASB 2020-1 Amendments
to AASs – Classification of
Liabilities as Current or Non-
current
Effective for annual reporting
periods beginning on or after 1
January 2024
AASB 2022-6 Amendments to
AASs – Non-current Liabilities
with Covenants
Effective for annual reporting
periods beginning on or after 1
January 2024
A liability is classified as current if the entity has no right at the end of the reporting
period to defer settlement for at least 12 months after the reporting period. The
AASB issued AASB 2020-1 Amendments to AASs – Classification of Liabilities as
Current or Non-current to clarify the requirements for classifying liabilities as current
or non-current, specifically:
› The amendments specify that the conditions which exist at the end of the
reporting period are those which will be used to determine if a right to defer
settlement of a liability exists.
› Management intention or expectation does not affect the classification of
liabilities.
›
In cases where an instrument with a conversion option is classified as a liability,
the transfer of equity instruments would constitute settlement of the liability for
the purpose of classifying it as current or non-current.
These amendments are applied retrospectively. Earlier application is permitted. This
is not expected to have a material impact.
Going Concern
The Group has prepared the financial statements on the basis that it will continue to operate as a going concern. The Directors
are satisfied the Group has adequate resources to continue as a going concern for not less than 12 months from the issue of the
financial report.
At 30 June 2023 the Group had cash and deposits totaling $32,862,626, however during FY23 the entity recorded a loss
before tax of $69,985,955 (FY22: $84,921,137) and incurred net cash outflows from operating activities of $50,179,674 (FY22:
$42,205,948). The Group’s ability to continue as a going concern is dependent upon its ability to continue to improve its operating
cash flows in the short term.
58 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT To achieve this the Group undertook a restructuring programme in the second half of the financial year to focus the business on
core priorities. As a result net cash outflows from operating activities reduced substantially in the fourth quarter of the financial
year and forecast to remain at this reduced level through FY24. In addition, the Group anticipates significant revenue growth in
FY24 compared to FY23, with the post-restructure cost base now in place sufficient to support that level of revenue growth.
The Company also undertook a capital raise post balance sheet in July raising $6.1m (net of costs) from new and existing
shareholders, and a further $3.5m of capital that was approved by shareholders at an EGM on 6 September 2023.
Based on management’s forecast of operating cashflows the Directors are satisfied the Group has adequate resources to
continue as a going concern for not less than 12 months from the issue of the financial report.
Restatement of Comparative Balances
Historical Customer Contracts
During the period to 31 December 2022 the company has completed a thorough review of its revenue recognition processes and
all open revenue contracts with customers, including ensuring that the basis of revenue recognition is in accordance with AASB 15
– Revenue from Contracts with Customers. As part of this review the company has identified a small number of revenue contracts
where revenue has been recognised in prior periods where an enforceable contractual claim to monies could not be supported
by contemporaneous documentation. As a result, the Group has reversed revenue and receivables (or increased payables) in
respect of these contracts where recognition could not be supported.
Variable Revenue Reversal Presentation
Additionally, as part of the completion of the financial report for the year ended 30 June 2022, the Company assessed the revenue
of certain contracts in accordance with AASB 15. As a result of this assessment, a provision for doubtful debts of $8.9m was
recorded against amounts previously invoiced, GST payable of $0.8m was reversed and an expense of $8.1m was presented
within general and administration expense. Upon further review in the current period, it has been concluded these amounts
should have been presented as a reversal of revenue relating to past periods instead of a doubtful debt expense.
The impact of the restatement on the comparative information is set out on the following pages:
DUBBER ANNUAL REPORT FY23 | 59
FINANCIAL REPORT CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
12 months to 30 June 2022
As previously
reported
$
Restatement
$
Restated
$
Service revenue
25,345,027
(866,489)1
24,478,538
Variable revenue reversal (prior year)
-
(8,160,943)2
(8,160,943)
Revenue
25,345,027
(9,027,432)
16,317,595
General and administration costs
(20,366,782)
8,160,9432
(12,205,839)3
Loss before income tax benefit
(84,054,648)
(866,489)
(84,921,137)
Loss after income tax expense for the period
(83,238,190)
(866,489)
(84,104,679)
Total comprehensive loss for the period attributable to owners of Dubber
Corporation Limited
(84,755,016)
(866,187)
(85,621,203)
Basic loss per share
Diluted loss per share
(27.93)
(0.29)
(28.22)
(27.93)
(0.29)
(28.22)
1.
2.
3.
Relates to Historical Customer Contracts Revenue Restatement
Relates to Variable Revenue Reversal Presentation Restatement
This item has been additionally reclassified in the current year disclosures – see section on reclassification of costs on page 61.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 1 July 2021
As at 30 June 2022
As previously
reported
$
Restatement
$
Restated
$
As previously
reported
$
Restatement
$
Restated
$
Trade and other
receivables
22,793,739
(676,731)
22,117,008
38,574,607
(1,883,147)
36,691,4621
Total Current Assets
55,371,095
(676,731)
54,694,364
92,958,584
(1,883,147)
91,075,4361
Total Assets
100,334,687
(676,731)
99,657,956
149,710,111
(1,255,567)
148,454,544
Trade and other
payables
Total Current
Liabilities
11,597,258
34,815,837
Total Liabilities
41,378,650
-
-
-
11,597,258
11,578,418
287,652
11,866,070
34,815,837
19,047,177
287,652
19,334,829
41,378,650
32,919,188
287,652
33,206,840
Net Assets
58,956,036
(676,731)
58,279,305
116,790,924
(1,543,220)
115,247,704
Accumulated losses
(100,280,501)
(676,731)
(100,957,232)
(183,518,691)
(1,543,220)
(185,061,911)
Total Equity
58,956,036
(676,731)
58,279,305
116,790,924
(1,543,220)
115,247,704
1.
Additionally, $627,579 was reclassified between current trade and other receivables and non-current other receivables to better reflect the maturity of the receivable.
All restatements are in relation to the Historical Customer Contracts Revenue Restatement.
60 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT Within trade and other receivables, the restatement is as follows:
As at 30 June 2022
As previously reported
$
Restatement
$
Restated
$
Trade receivables
13,758,277
(10,213,614)1,2
3,544,663
Provision for expected credit losses
(8,958,047)
8,958,0472
-
Total
4,800,230
(1,255,567)
3,544,663
1.
2.
Relates to Historical Customer Contracts Revenue Restatement
Relates to Variable Revenue Reversal Presentation Restatement
Reclassification of costs
The costs included in the comparative consolidated statement of profit or loss and comprehensive income for the year ended
30 June 2022 includes a reclassification from Direct costs to General and administration and Salaries and related expenses. The
costs have been reviewed during the period to reflect the nature of cost categories more closely, and as a result the prior period
value has been reclassified. There is no impact to comparative operating profit as a result of this reclassification.
30 June 2022 (original)
$
30 June 2022 (reclassified)
$
30 June 2022 (restated)
$
Direct costs
23,497,239
11,373,421
11,373,421
General and administration costs
20,366,782
28,660,242
20,499,299
Salaries and related costs
36,523,433
40,353,791
40,353,791
Typographical error – 30 June 2022 consolidated statement of financial position
The consolidated statement of financial position as at 30 June 2022 in the FY22 annual report contained a typographical error
being total assets of $140,710,113. The correct value of total assets is $149,710,113. This was then restated to $148,454,544 (see
restatement of comparative note above).
DUBBER ANNUAL REPORT FY23 | 61
FINANCIAL REPORT REVENUE RECOGNITION
Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on
behalf of third parties. The Group recognises revenue when it transfers control over a service to a customer.
Group revenues consists of service income, being monthly subscription fees from retail or reseller customers.
Subscription service income
Subscription service revenue is recognised and measured in the accounting period in which the services are provided based on
the amount of the expected transaction price allocated to each performance obligation.
The performance obligations are the provision of cloud-based call recording services (Dubber Platform) on a monthly basis; the
provision of services represent a series of distinct services that are substantially the same with the same pattern of transfer
to customer.
Provision of services relating to establishment and configuration is not distinct from the platform usage (i.e. call recording
services) as the customer cannot benefit from the establishment and configuration alone and hence are regarded as one
performance that is satisfied over time.
GOVERNMENT GRANTS/RESEARCH AND DEVELOPMENT TAX INCENTIVES
Grants from the government (such as research and development tax incentives) are recognised at their fair value where there is
reasonable assurance that the grant will be received and the Group will comply with all attached conditions.
BASIS OF CONSOLIDATION
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Dubber Corporation Limited
(“Company” or “parent entity”) as at 30 June 2023 and the results of all subsidiaries for the year then ended. Dubber Corporation
Limited and its subsidiaries together are referred to in these financial statements as the Group or the consolidated entity.
Subsidiaries are all entities (including special purpose entities) over which the Group has control. The Group has control over 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
use its power to affect those returns.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the
date that control ceases. 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 the impairment of the asset transferred. Accounting
policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. Refer to the ‘business combinations’
accounting policy for further details. A change in ownership interest, without the loss of control, is accounted for as an equity
transaction, where the difference between the consideration transferred and the book value of the share of the non-controlling
interest acquired is recognised directly in equity attributable to the parent.
CONTRACT LIABILITIES
Contract liabilities represent the consolidated entity’s obligation to transfer services to a customer and are recognised when
a customer pays consideration, or when the consolidated entity recognises a receivable to reflect its unconditional right to
consideration (whichever is earlier) before the consolidated entity has transferred the services to the customer.
FAIR VALUE MEASUREMENT
When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the fair value
is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date; and assumes that the transaction will take place either: in the principal market; or in the
absence of a principal market, in the most advantageous market.
62 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT Fair value is measured using the assumptions that market participants would use when pricing the asset or liability, assuming they
act in their economic best interests. For non-financial assets, the fair value measurement is based on its highest and best use.
Valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value,
are used, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.
Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the significance
of the inputs used in making the measurements. Classifications are reviewed at each reporting date and transfers between levels
are determined based on a reassessment of the lowest level of input that is significant to the fair value measurement.
For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either not
available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge and
reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an analysis is
undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison, where applicable,
with external sources of data.
SEGMENT REPORTING
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the
operating segments, has been identified as the full Board of Directors.
FOREIGN CURRENCY TRANSLATION
Functional and presentation currency
The consolidated financial statements are presented in Australian dollars, which is the functional and presentation currency of
Dubber Corporation Limited.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at
year end exchange rates of monetary assets and liabilities, denominated in foreign currencies, are recognised in profit or loss.
Foreign operations
The assets and liabilities of foreign operations are translated to the functional currency as exchange rates at the reporting
date. The income and expenses of foreign operations are translated to Australian dollars at exchange rates at the dates of
the transactions.
Foreign currency difference is recognised in other comprehensive income and presented in the foreign currency translation
reserve in equity.
On consolidation, exchange differences arising from the translation of any net investment in foreign entities are recognised in
other comprehensive income. When the settlement of a monetary item receivable from or payable to a foreign operation is
neither planned nor likely in the foreseeable future, foreign exchange gains and losses arising from such a monetary item are
considered to form part of a net investment in a foreign operation and are recognised in other comprehensive income and
are presented in the translation reserve in equity. When a foreign operation is sold or any borrowings forming part of the net
investment are repaid, the associated exchange differences are reclassified to profit or loss, as part of the gain or loss on sale.
FINANCE INCOME
Finance income comprises interest income earned on funds invested in bank accounts and call deposits. Interest is recognised
on an accrual basis in the consolidated statement of profit or loss and other comprehensive income, using the effective
interest method.
INCOME TAX
The income tax expense (revenue) for the year comprises current income tax expense (income) and deferred tax
expense (income).
DUBBER ANNUAL REPORT FY23 | 63
FINANCIAL REPORT Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using applicable income
tax rates enacted, or substantially enacted, as at the end of the reporting period. Current tax liabilities (assets) are therefore
measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as well
as unused tax losses.
Current and deferred tax expense (income) is charged or credited directly to equity instead of the profit or loss when the tax
relates to items that are credited or charged directly to equity.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where amounts have been fully
expensed but future tax deductions are available. No deferred income tax will be recognised from the initial recognition of an
asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset is
realised or the liability is settled, based on tax rates enacted or substantively enacted at the end of the reporting period. Their
measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related
asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is probable
that future taxable profit will be available against which the benefits of the deferred tax asset can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures, deferred
tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be controlled and it
is not probable that the reversal will occur in the foreseeable future.
Current assets and liabilities are offset where a legally enforceable right of setoff exists and it is intended that net settlement
or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are
offset where a legally enforceable right of setoff exists, the deferred tax assets and liabilities relate to income taxes levied by the
same taxation authority on either the same taxable entity or different taxable entities where it is intended that net settlement
or simultaneous realisation and settlement of the respective asset and liability will occur in future periods in which significant
amounts of deferred tax assets or liabilities are expected to be recovered or settled.
PROVISIONS
Provisions are recognised when a Group company has a legal or constructive obligation, as a result of past events, for which it is
probable that an outflow of economic benefits will result and that outflow can be reliably measured.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments with
original maturities of three months or less.
TRADE RECEIVABLES
Trade receivables are initially recognised at transaction price, less any allowance for expected credit losses. Trade receivables are
generally due for settlement within 30 days.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
FINANCIAL INSTRUMENTS
Recognition and derecognition
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the
financial instrument.
Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when
the financial asset and substantially all the risk and rewards are transferred. A financial liability is derecognised when it is
extinguished, discharged, cancelled or expires.
64 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT Classification and initial measurement of financial assets
Financial assets are classified according to their business model and the characteristics of their contractual cash flows and are
initially measured at fair value adjusting for transaction costs (where applicable).
Subsequent measurement of financial assets
For the purpose of subsequent measurement, financial assets, other than those designated and effective as hedging instruments,
are classified into the following four categories:
• Financial assets at amortised cost
• Financial assets at fair value through profit or loss (FVTPL)
• Debt instruments at fair value through other comprehensive income (FVTOCI)
• Equity instruments at FVTOCI
Financial assets at amortised cost
Financial assets with contractual cash flows representing solely payments of principal and interest and held within a business
model of ‘hold to collect’ contractual cash flows are accounted for at amortised cost using the effective interest method. The
Group’s trade and other receivables fall into this category of financial instruments.
Impairment
The Group makes use of a simplified approach in accounting for trade and other receivables and records the loss allowance at
the amount equal to the expected lifetime credit losses. In using this practical expedient, the Group uses its historical experience,
external indicators and forward looking information to calculate the expected credit losses using a provision matrix.
The Group considers a financial asset in default when contractual payment are 90 days are due. However, in certain cases,
the Group may also consider a financial asset to be in default when internal or external information indicates that the Group
is unlikely to receive the outstanding contractual amounts in full before taking into account any credit enhancements held by
the Group.
PROPERTY, PLANT AND EQUIPMENT
Each class of property, plant and equipment is carried at cost or fair value as indicated, less, where applicable, any accumulated
depreciation and impairment losses.
Plant and equipment
Plant and equipment are measured on the cost basis.
Depreciation
The depreciable amount of all fixed assets including buildings and capitalised leased assets, but excluding freehold land, is
depreciated on a straight-line basis over the asset’s useful life to the Company commencing from the time the asset is held ready
for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated
useful lives of the improvements.
The estimated useful lives used for each class of depreciable assets are:
Property, plant and equipment
Useful Life
Furniture, Fixtures and Fittings
Computer Equipment
Office Equipment
5 years
5 years
5 years
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. An
asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its
estimated recoverable amount.
DUBBER ANNUAL REPORT FY23 | 65
FINANCIAL REPORT Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are
included in the statement of profit or loss and other comprehensive income. When revalued assets are sold, amounts included in
the revaluation surplus relating to that asset are transferred to retained earnings.
Property, plant and equipment is derecognised and removed from the statement of financial position on disposal or when
no future economic benefits are expected. Gains and losses from derecognition are measured as the difference between
the net disposal proceeds, if any, and the carrying amount and are recognised in the statement of profit or loss and other
comprehensive income.
Subsequent costs are included in the property, plant and equipment’s carrying value or recognised as a separate asset when
it is probable that future economic benefits associated with the item will be realised and the cost of the item can be measured
reliably. All other repairs and maintenance are recognised in the statement of profit or loss and other comprehensive income.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, which
comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the
commencement date net of any lease incentives received, any initial direct costs incurred, and, except were included in the cost
of inventories, an estimate of costs expected to be incurred for dismantling and removing the underlying asset, and restoring the
site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated useful life of
the asset, whichever is the shorter. Where the consolidated entity expects to obtain ownership of the leased asset at the end of
the lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to impairment or adjusted for any
remeasurement of lease liabilities.
Right-of-use asset
Melbourne (AU) office
Brisbane (AU) office
Sydney (AU) office
London (UK) office
Oxford (UK) office
Dallas (USA) office
Equipment leases
Lease liabilities
Useful Life
4-5 years
6 years
3 years
6 years
10 years
3.25 years
3-6 years
A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at the present value of
the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate
cannot be readily determined, the consolidated entity’s incremental borrowing rate. Lease payments comprise of fixed payments
less any lease incentives receivable, variable lease payments that depend on an index or a rate, amounts expected to be paid
under residual value guarantees, exercise price of a purchase option when the exercise of the option is reasonably certain to
occur, and any anticipated termination penalties. The variable lease payments that do not depend on an index or a rate are
expensed in the period in which they are incurred.
The carrying amounts are remeasured if there is a change in the following: future lease payments arising from a change in an
index or a rate used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease
liability is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying amount of
the right-of-use asset is fully written down.
66 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT IMPAIRMENT OF ASSETS
At each reporting date, the Group assesses whether there is any indication that an asset may be impaired. The assessment
will include the consideration of external and internal sources of information including, dividends received from subsidiaries,
associates or jointly controlled entities deemed to be out of preacquisition profits. If such an indication exists, an impairment
test is carried out on the asset by comparing the recoverable amount of the asset, being the higher of the asset’s fair value less
costs to sell and value in use, to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is
expensed to the statement of profit or loss and other comprehensive income.
Where an impairment loss on a revalued asset is identified, this is debited against the revaluation surplus in respect of the same
class of asset to the extent that the impairment loss does not exceed the amount in the revaluation surplus for that same class
of asset.
Non-financial assets, other than inventories, deferred tax assets, assets from employee benefits, and contract assets, are
assessed for any indication of impairment at the end of each reporting period. Any indication of impairment requires formal
testing of impairment by comparing the carrying amount of the asset to an estimate of the recoverable amount of the asset.
An impairment loss is calculated as the amount by which the carrying amount of the asset exceeds the recoverable amount of
the asset.
Intangible assets with an indefinite useful life and intangible assets not yet available for use are tested for impairment annually
regardless of whether there is any indication of impairment.
The recoverable amount is the greater of the asset’s fair value less costs to sell and its value in use. The asset’s value in use is
calculated as the estimated future cash flows discounted to their present value using a post-tax rate that reflects current market
assessments of the time value of money and the risks associated with the asset.
Assets that cannot be tested individually for impairment, are grouped together into the smallest group of assets that generates
cash inflows (the asset’s cash generating unit).
Impairment losses are recognised in the statement of profit or loss and other comprehensive income. Impairment losses are
allocated first, to reduce the carrying amount of any goodwill allocated to cash-generating units, and then to other assets of the
group on a pro-rata basis.
Assets other than goodwill are assessed at the end of each reporting period to determine whether previously recognised
impairment losses may no longer exist or may have decreased. Impairment losses recognised in prior periods for assets
other than goodwill are reversed up to the carrying amounts that would have been determined had no impairment loss been
recognised in prior periods.
TRADE AND OTHER PAYABLES
Trade and other payables represent the liability outstanding at the end of the reporting period for goods and services received by
the Company during the reporting period which remain unpaid. The balance is recognised as a current liability with the amounts
normally paid within 30 days of recognition of the liability.
GOODS AND SERVICES TAX (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not
recoverable from the Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as
part of an item of the expense. Receivables and payables in the statement of financial position are shown inclusive of GST.
CONTRIBUTED EQUITY
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. Incremental costs directly attributable to the issue of new shares or options
for the acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration.
DUBBER ANNUAL REPORT FY23 | 67
FINANCIAL REPORT EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the profit attributable to ordinary shareholders of the Company by the weighted
average number of ordinary shares outstanding during the financial year.
CURRENT AND NON-CURRENT CLASSIFICATION
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the consolidated
entity’s normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months after
the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle a liability for
at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the consolidated entity’s normal operating cycle; it
is held primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities are
classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
SHARE-BASED PAYMENT TRANSACTIONS
Employees of the Company receive remuneration in the form of share based payment transactions, whereby employees render
services in exchange for equity instruments (“equity settled transactions”).
When the goods or services acquired in a share based payment transaction do not qualify for recognition as assets, they are
recognised as expenses.
The cost of equity settled transactions and the corresponding increase in equity is measured at the fair value of the goods or
services acquired. Where the fair value of the goods or services received cannot be reliably estimated, the fair value is determined
indirectly by the fair value of the equity instruments using the Black Scholes option valuation technique.
Equity settled transactions that vest after employees complete a specified period of service are recognised as services received
during the vesting period with a corresponding increase in equity.
INTANGIBLE ASSETS
Intangible assets acquired as part of a business combination are brought in at fair value at acquisition. Intangible assets with finite
useful life are amortised over a straight-line basis in the profit or loss over the estimated useful life. Management had previously
re-assessed the useful life of the platform from 10 years to 5 years, as they believe it is more reflective of the useful life.
Customer relationships
Customer relationships acquired as part of a business combination are recognised separately from goodwill. The customer
relationships are carried at fair value at the date of acquisition less accumulated amortisation and any impairment losses. These
are amortised over on a straight line basis over the period of their expected benefit, being their finite life of 7 years.
Technology
The technology acquired in a business combination for proprietary software solutions are recognised separately from goodwill.
This technology is carried at fair value at the date of acquisition less accumulated amortisation and any impairment losses.
Technology related assets are amortised over on a straight line basis over the period of their expected benefit, being their finite
life of 5 to 7 years.
68 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT Research & Development Costs
Research costs are expensed when incurred. Development costs are capitalized when they meet all the relevant criteria in
AASB138 Intangible Assets.
GOODWILL
Goodwill is measured as described in Business combination policy. Goodwill on acquisition of subsidiaries is included in
intangible assets. Goodwill is not amortised, but it is tested for impairment annually, or more frequently if events or changes in
circumstances indicate that it might be impaired and is carried at cost less accumulated impairment losses. Gains and losses on
the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-
generating units or groups of cash-generating units that are expected to benefit from the business combination in which
the goodwill arose. The units or groups of units are identified at the lowest level at which goodwill is monitored for internal
management purposes, being the operating segments (Note 20).
EMPLOYEE PROVISIONS
Short-term employee benefit obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave expected to be
settled wholly within 12 months after the end of the reporting period are recognised in other liabilities in respect of employees’
services rendered up to the end of the reporting period and are measured at amounts expected to be paid when the liabilities
are settled. Liabilities for non-accumulating sick leave are recognised when leave is taken and measured at the actual rates paid
or payable.
Other long-term employee benefit obligations
Liabilities for long service leave and annual leave are not expected to be settled wholly within 12 months after the end of
the reporting period. They are recognised as part of the provision for employee benefits and measured as the present value
of expected future payments to be made in respect of services provided by employees to the end of the reporting period.
Consideration is given to expected future salaries and wages levels, experience of employee departures and periods of service.
Expected future payments are discounted using national government corporate bond rates at the end of the reporting period
with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
Regardless of when settlement is expected to occur, liabilities for long service leave and annual leave are presented as current
liabilities in the statement of financial position if the entity does not have an unconditional right to defer settlement for at least 12
months after the end of the reporting period.
ASSET ACQUISITION
On 17 September 2021, the Group acquired assets from Pinch Labs Inc and Pinch Labs Pty Ltd (collectively “Notiv”) by the issue
of shares and cash and the transaction is accounted for as an asset acquisition. The optional concentration test was applied in
determining whether this transaction constitutes a business combination in accordance with paragraph B7A of AASB 3 Business
Combinations.
As the acquisition of the acquired assets is not a deemed business combination, the assets and liabilities are assigned carrying
amounts based on their relative fair values in an asset acquisition and no deferred tax arose in relation to the acquired assets and
assumed liabilities. No goodwill arose on the acquisition.
BUSINESS COMBINATIONS
The acquisition method of accounting is used to account for business combinations regardless of whether equity instruments or
other assets are acquired.
The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity instruments issued
or liabilities incurred by the acquirer to former owners of the acquiree and the amount of any non-controlling interest in the
acquiree. All acquisition costs are expensed as incurred to profit or loss.
DUBBER ANNUAL REPORT FY23 | 69
FINANCIAL REPORT On the acquisition of a business, the consolidated entity assesses the financial assets acquired and liabilities assumed for
appropriate classification and designation in accordance with the contractual terms, economic conditions, the consolidated
entity’s operating or accounting policies and other pertinent conditions in existence at the acquisition-date.
The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-controlling interest in
the acquiree and the fair value of the consideration transferred and the fair value of any pre-existing investment in the acquiree is
recognised as goodwill. If the consideration transferred and the pre- existing fair value is less than the fair value of the identifiable
net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a gain directly in profit or loss by the
acquirer on the acquisition- date, but only after a reassessment of the identification and measurement of the net assets acquired,
the non-controlling interest in the acquiree, if any, the consideration transferred and the acquirer’s previously held equity interest
in the acquirer.
Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional
amounts recognised and recognises additional assets or liabilities during the measurement period, based on new information
obtained about the facts and circumstances that existed at the acquisition-date. The measurement period ends on either the
earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information possible to determine
fair value.
PARENT ENTITY FINANCIAL INFORMATION
The financial information for the parent entity, Dubber Corporation Limited, disclosed in Note 24 has been prepared on the same
basis as the consolidated financial statements.
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The directors evaluate estimates and judgments incorporated into the financial statements based on historical knowledge and
best available current information. Estimates assume a reasonable expectation of future events and are based on current trends
and economic data, obtained both externally and within the Company.
Carrying value of goodwill
The Group tests annually whether the carrying value of goodwill and other intangibles exceed its recoverable amount to
determine potential impairment requirements. The recoverable amount of goodwill and other intangibles has been calculated
using a number of assumptions as disclosed in Note 7. An impairment of $3,679,449 has been recognised in respect of goodwill
during the reporting period.
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 date at which they are granted. The fair value is determined using a binomial option pricing or black scholes
method. The related assumptions are detailed in Note 23. The accounting estimates and assumptions relating to equity-settled
share-based payments would have no impact on the carrying amounts of assets and liabilities within the next annual reporting
period but may impact expenses and equity.
Determination of Asset Acquisition or Business Combination
The determination of whether an acquisition of business assets represents an asset acquisition or business combination requires
significant judgement. During the prior period, the Group acquired business assets from Pinch Labs Inc and Pinch Labs Pty Ltd
(collectively “Notiv”). In accordance with AASB 3 Business Combinations, if the “concentration test” is met, the acquired set of
activities and assets is determined not to be a business. Judgement was applied in deeming that the asset being acquired is the
Notiv AI technology based on the acquired intellectual property representing approximately 99.6% of the value of the assets
acquired and hence satisfying the ‘concentration test’ as set out in AASB 3.
70 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT The following key judgements have been applied in relation to:
Revenue from contracts with customers
The Group applied the following judgements that significantly affect the determination of the amount and timing of revenue from
contracts with customers:
• The Group determined that revenue from its software service is to be recognised over time because the customer
simultaneously receives and consumes the benefits provided by the Group.
• The Group has determined that it is the principal in its agreements with its customers because it has control over the
service before delivering it to the customer, it is primarily responsible for fulfilling the promise to deliver the service, and it is
responsible for establishing the price for the service to be delivered.
• When recognising revenue from contracts with customers, the Group determines that it is probable that the Group will collect
the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer.
This is determined based upon the credit worthiness of the customer and the Group makes reference to credit ratings,
historical payment default rate and financial capacity to meet obligations in determining these judgements. During the year,
certain contracts were reassessed for this criteria and due to changes in facts and circumstances relating to the customers’
ability to make these payments under the contract, revenue invoiced relating to these contracts were not recognized for the
current year.
Deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only if the Group considers it probable that future
taxable amounts will be available to utilise those temporary differences and losses. Significant management judgement is
required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of
future taxable profits, together with future tax planning strategies.
DUBBER ANNUAL REPORT FY23 | 71
FINANCIAL REPORT 2. Revenue and Expenses from Continuing Operations
(a) Revenue*
Subscriptions
Variable revenue reversal
(prior financial year) **
Professional services
Total
(b) Other income
Research and development tax incentive
Export market development grant
Other
Total
(c) General and administration
Audit, accounting and tax advice fees
Advertising, marketing and events
Doubtful debts
Legal fees
Securities exchange and registry fees
Rent and outgoings
Travel costs
Corporate affairs
Insurances
Software and other technology costs
Consultants
Other administration costs
Total
* Disaggregation of revenue from contracts with customer
Note
2023
$
2022 (Restated)
$
29,948,177
24,385,038
-
(8,160,943)
81,634
93,500
30,029,811
16,317,595
87,246
-
655
11,450
74,850
3,629
87,901
89,929
1,102,471
534,100
3,412,628
3,460,598
5
243,057
738,700
1,063,848
1,460,205
323,175
379,776
464,785
486,136
1,906,752
2,056,825
246,370
329,208
658,018
484,595
2,274,310
7,148,798
3,297,382
1,354,380
2,273,071
2,065,978
17,265,867
20,499,299
** As part of the completion of the financial report for the year ended 30 June 2022, the Company re-assessed the revenue of certain contracts in accordance
with AASB 15. As a result of this re-assessment, certain variable revenues relating to platform fees within customer agreements relating to past periods (i.e.
FY21 and prior financial years) were reversed. Further details are set out in Note 1.
Revenue is recognised when or as the Group transfers services to a customer at the amount to which the group expects to be
entitled over time.
Contracts with customers are based on a single identified performance obligation being the provision of subscriptions services
transferred over time. For the financial year ended 30 June 2023, revenue recognised was $29,948,177 (2022: $24,385,038).
Disaggregation of revenue by geographical regions is as disclosed in Note 20 - Operating Segments.
72 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT 3. Income Tax
(a) Income tax expense
Loss before income tax expense
Prima facie tax payable on profit from ordinary activities before income tax
at 25% (2022: 25%)
Tax Effect of:
2023
$
2022 (Restated)
$
(69,985,955)
(84,921,137)
(17,496,489)
(21,230,284)
Tax effect of amounts not deductible (taxable) in calculating taxable income
1,553,118
4,276,204
Impact of future changes in tax rates to deferred tax liabilities
Recognition of deferred tax assets from losses
Tax rate differential
438,632
(678,115)
-
-
618,332
610,369
Tax losses and temporary differences not recognised
14,775,138
15,527,252
Income tax benefit
(b) Deferred tax assets
Temporary differences
Tax losses - revenue
Tax losses - capital
Gross deferred tax assets
Offset against deferred tax liabilities
(789,384)
(816,458)
2,223,241
4,378,939
38,429,129
25,393,943
478,864
478,864
41,131,234
30,251,746
(678,115)
(1,028,811)
Deferred tax assets not brought to account
(40,453,119)
(29,222,935)
Deferred tax assets recognized on balance sheet
-
-
(c) Deferred tax liabilities
Temporary differences - intangibles
Offset by deferred tax assets
(3,020,808)
(3,910,635)
678,115
1,028,811
Deferred tax liabilities recognised on balance sheet
(2,342,693)
(2,881,824)
There are no franking credits available to the Group.
Tax losses and timing differences continue to be available indefinitely subject to compliance with tax regulatory requirements.
The ability of the Group to utilize tax losses in the future will be dependent upon the ongoing compliance with regulatory taxation
requirements together with the production of sufficient taxable income.
DUBBER ANNUAL REPORT FY23 | 73
FINANCIAL REPORT 4. Cash and Cash Equivalents
Cash at bank
Total
2023
$
2022
$
2,862,626
54,383,974
2,862,626
54,383,974
In addition to the cash at bank, as set out in Note 5 the Company has $30,000,000 in a Cash at Call deposit which is not classified
as cash at 30 June 2023 as the original maturity of the deposit was greater than 90 days.
The Company’s exposure to interest rate risk is outlined in Note 16.
5. Trade and Other Receivables
Current
Trade receivables
Less: Provision for doubtful debt
Sub total
Receivable from Medulla Group Pty Ltd vendors
Cash at call deposit
Other debtors
Contract assets
Prepayments
Deposits in trust
Other receivables
Total
2023
$
2022 (Restated)
$
3,827,687
3,544,663
(55,835)
-
3,771,852
3,544,663
-
100,977
30,000,000
30,000,000
171,637
135,283
193,476
711,974
1,063,298
939,371
158,508
1,213,820
1,604,484
45,374
36,963,255
36,691,462
Deposits in trust includes cash amounts deposited in a trust account. These amounts are set aside to facilitate negotiations with
the Groups suppliers. The cash can be recalled at any time by the Company.
Cash at Call deposit is a cash term deposit held with a AA3 rated financial institution with a 31 day call back in the name of the
Company’s legal firm as trustee for the Company.
Contract assets relate to earned revenue which the Company is entitled to that remain unbilled to customers as of 30 June 2023.
Trade and other receivables are all due within three months of this report. Information about credit and liquidity risk is outlined in
Note 16.
74 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT 6. Property, Plant and Equipment
Furniture, Fixtures and Fittings - at cost
Less: Accumulated depreciation
Sub total
Computer Equipment - at cost
Less: Accumulated depreciation
Sub total
Office Equipment - at cost
Less: Accumulated depreciation
Sub total
Net carrying amount
RECONCILIATION
2023
$
2022 (Restated)
$
2,891,164
2,265,118
(1,451,273)
(473,643)
1,439,891
1,791,475
1,890,437
2,262,180
(1,321,325)
(1,199,786)
569,112
1,062,394
90,033
84,592
(88,750)
(68,252)
1,283
16,340
2,010,286
2,870,209
Reconciliation of the carrying amount for each class of property, plant and equipment between the beginning and the end of the
current and previous financial year are set out below:
2023
Computer
Equipment
$
Office
Equipment
$
Furniture,
Fixtures and
Fittings
$
Total
$
Balance at the beginning of the year
1,062,394
16,340
1,791,475
2,870,209
Additions
Transfers
149,329
5,441
504,405
659,175
(216,236)
-
216,236
-
Depreciation expense
(420,530)
(17,597)
(974,816)
(1,412,943)
Foreign exchange movement
(5,845)
(2,901)
(97,409)
(106,155)
Carrying amount at the end of the year
569,112
1,283
1,439,891
2,010,286
2022
Balance at the beginning of the year
Additions through asset acquisitions
667,698
-
32,307
16,944
35,182
735,187
-
16,944
Additions
815,253
19,529
2,204,190
3,038,972
Depreciation expense
(319,996)
(24,706)
(444,416)
(789,118)
Foreign exchange movement
(100,561)
(27,734)
(3,481)
(131,776)
Carrying amount at the end of the year
1,062,394
16,340
1,791,475
2,870,209
DUBBER ANNUAL REPORT FY23 | 75
FINANCIAL REPORT 7. Intangible Assets
Customer Assets
At cost
Less: Accumulated amortisation
Sub total
Technology
At cost
Less: Accumulated amortisation
Sub total
Goodwill
At cost
Less: Accumulated amortisation
Sub total
Net carrying amount at the end of the year
RECONCILIATION
2023
$
2022
$
10,881,736
10,033,839
(3,917,553)
(2,179,563)
6,964,182
7,854,276
28,069,258
26,118,017
(17,399,321)
(12,969,365)
6,964,183
13,148,652
24,085,193
22,470,834
(3,679,448)
-
20,405,745
22,470,834
38,039,864
43,473,762
Reconciliation of the carrying amount for each class of intangible asset between the beginning and the end of the current and
previous financial year are set out below:
2023
Goodwill
$
Customer
Asset
$
Technology
Asset
$
Total
$
Balance at the beginning of the year
22,470,834
7,854,276
13,148,652
43,473,762
Impairment expense
(3,679,449)
-
-
(3,679,449)
Foreign exchange movement
1,614,359
608,636
422,490
2,645,485
Amortisation expense
-
(1,498,729)
(2,901,205)
(4,399,934)
Carrying amount at the end of the year
20,405,744
6,964,183
10,669,937
38,039,864
2022
Balance at the beginning of the year
23,427,866
9,752,947
9,081,097
42,261,910
Capitalised during the year
Additions through asset acquisitions
-
-
-
-
1,703,136
1,703,136
6,506,413
6,506,413
Foreign exchange movement
(957,032)
(430,240)
(293,643)
(1,680,915)
Amortisation expense
-
(1,468,431)
(3,848,351)
(5,316,782)
Carrying amount at the end of the year
22,470,834
7,854,276
13,148,652
43,473,762
* On 17 September 2021, the Group acquired assets from Pinch Labs Inc and Pinch Labs Pty Ltd (collectively “Notiv”) by the issue
of shares and cash. The transaction was accounted for as an asset acquisition.
76 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT The consideration consisted of $5,152,324 cash and 386,277 shares at $3.75/share (valued at $1,448,539) for a total of
$6,600,863.
The group acquired the following net assets in the transaction:
Acquired statement of financial position (17 September 2021)
Customer Assets
Cash and cash equivalents
Other receivables and prepayments
Total current assets
Non-current Assets
Notiv intellectual property
Property, plant and equipment
Total non-current assets
Total assets
Current Liabilities
Trade and other payables
Provision for annual leave
Total current liabilities
Total liabilities
Net assets
2022
$
314,654
4,622
319,276
6,506,413
16,944
6,523,357
6,842,633
196,796
44,974
241,770
241,770
6,600,863
*The Notiv Intellectual property asset meets the recognition requirements of AASB 138 Intangible Assets and is amortised over 5 years, which management
have assessed as the expected useful life due to the technological nature of the asset.
Estimates and judgement were made in determining the fair value of assets acquired and liabilities assumed in the
asset acquisition.
Intangible assets acquired as part of the asset acquisition relates to technology. The fair value of the acquired technology asset
was determined by reference to the asset’s cost of acquisition, being the $6,600,863 consideration paid less other acquired
net assets.
DUBBER ANNUAL REPORT FY23 | 77
FINANCIAL REPORT IMPAIRMENT TESTING
Carrying amount of goodwill allocated to the following cash-generating units subject to impairment testing:
Europe
Goodwill
Rest of world
Goodwill
2023
$
2022
$
17,194,289
19,104,378
3,211,455
3,366,456
Carrying amounts for each CGU are calculated based on specifically identified assets and liabilities used by the CGU including
net working capital. For Corporate assets and liabilities these are allocated to each CGU on a systematic basis reflecting the
anticipated usage.
The recoverable amount of both Europe and Rest of World CGUs’ goodwill has been primarily determined using a value in use
calculation using cash flow projections from financial budgets approved by the Board for FY24, and then projected forward to
cover an eight-year period being an appropriate period to reflect the anticipated incremental growth profile of the business and
very low rate of customer churn.
The following key assumptions were used for each CGU subject to impairment testing:
Assumption
Post-tax discount rate
Long term growth rate
Europe CGU
Rest of world CGU
15.5%
3.0%
14.4%
2.5%
As a further cross check the Company obtained a valuation report which used market-based methods, including a Guideline
Transaction Method and Guideline Company Method, to assess the fair value less costs to sell of each CGU, which did not
demonstrate a materially different value to the value-in-use calculation.
Europe CGU
The recoverable amount of the Europe CGU of $24,410,000 as at 30 June 2023 has been determined based on a value in use
calculation using cash flow projections from financial budgets approved by senior management covering a one-year period, and
then projected forward to cover a further 7 year period up to FY31. The projected cash flows have been updated to reflect the
expected demand for the CGUs products and services, with the most significant assumption being the use of a declining revenue
growth over the seven-year projection period of FY25 to FY31 with a Cumulative Annual Growth Rate (CAGR) of 10.5%. These
projections reflect management’s view of future market growth for services together with relationships developed with potential
customers. The post-tax discount rate applied to cash flow projections is 15.5% and cash flows beyond the eight-year period are
extrapolated using a 3.0% growth rate.
It was concluded that the fair value less costs of disposal did not exceed the value in use. As a result of this analysis, management
has recognised an impairment charge of 3,505,000 in the current year against goodwill with a carrying amount of $19,104,378 as
at 30 June 2023. The impairment charge is recorded within impairment of goodwill in the statement of profit or loss.
Rest of World (RoW) CGU
The recoverable amount of the RoW CGU of $3,112,000 as at 30 June 2023 has been determined based on a value in use
calculation using cash flow projections from financial budgets approved by senior management covering a one-year period, and
then projected forward to cover a further 7 year period up to FY31. The projected cash flows have been updated to reflect the
expected demand for the CGUs products and services, with the most significant assumption being the use of a declining revenue
growth over the seven-year projection period with a Cumulative Annual Growth Rate (CAGR) of 10.5%. These projections reflect
management’s view of future market growth for services together with relationships developed with potential customers. The
post-tax discount rate applied to cash flow projections is 14.4% and cash flows beyond the eight-year period are extrapolated
using a 2.5% growth rate.
78 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT It was concluded that the fair value less costs of disposal did not exceed the value in use. As a result of the analysis, there is
headroom of $1,282,000 and management did not identify an impairment for this CGU at 30 June 2023.
An impairment charge of $174,480 was recognised against RoW goodwill at 31 December 2022 based on an impairment test
performed at that date. The impairment charge is recorded within impairment of goodwill in the statement of profit or loss.
Sensitivities to changes in assumptions
The calculation of value-in-use for both the Europe and RoW CGU is most sensitive to the following assumptions:
• Revenue growth rates
• Discount rates
Revenue growth rates
A reduction in the revenue CAGR of 0.5% for the 7-year projection period from 10.5% to 10.0% with no changes to any other
assumption (including the rate of growth applied to costs) would result in a further impairment of goodwill in the Europe CGU
of $6,300,000, and result in nil headroom in the RoW CGU. Management anticipate the Group would also reduce costs in the
event of any reduction in projected revenue and have disclosed these sensitivities solely to demonstrate the relationship to
future growth.
Discount rates
A rise in the post-tax discount rate to 16.5% (i.e., +1.0%) in the Europe CGU would result in a further impairment of $3,789,000. A
rise in the post-tax discount rate to 15.9% (i.e., +1.5%) in the RoW CGU would result in nil headroom.
DUBBER ANNUAL REPORT FY23 | 79
FINANCIAL REPORT 8. Leases
(i.) Amounts recognised in the consolidated statement of financial position shows the following amounts relating to leases:
Right-of-use assets
Office space
Accumulated amortisation
Sub total
Computer equipment
Accumulated amortisation
Sub total
Total
Lease liabilities
Current
Non-current
Total
2023
$
2022
$
12,943,084
12,485,794
(4,554,770)
(2,078,235)
8,388,314
10,407,559
276,342
(78,990)
197,352
-
-
8,585,666
10,407,559
2,526,287
2,017,863
6,839,818
9,264,706
9,366,105
11,282,569
Additions to the rights-of-use assets during the 2023 financial year were $276,342 (2022: $9,741,416).
(ii.) Amounts recognised in the consolidated of profit or loss and other comprehensive income.
2023
$
2022
$
Depreciation charge of right-of-use assets
2,534,919
1,154,806
Interest expense
639,922
212,847
The total cash outflow for leases in 2023 was $2,886,956 (2022: $963,527).
Total short-term operating lease expenses where the lease terms are less than 12 months amounted to $177,627 in FY23 (2022:
$191,992).
80 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT 9. Trade and Other Payables
Current
Trade payables
2023
$
2022 (Restated)
$
7,591,020
8,517,268
Payroll tax and other statutory liabilities
7,541,855
2,847,611
Other payables
Total
95,328
501,191
15,228,203
11,866,070
All payables are expected to be settled within 12 months. Risk management policies in regard to liquidity and currency risk are
outlined in Note 16.
10. Provisions
Current
Employee benefits
Non-Current
Employee benefits
Total
2023
$
2022
$
1,479,283
1,498,724
743,435
455,787
2,222,718
1,954,511
Employee benefits represent annual leave and long service leave entitlements of employees within the Group and is non-
interest bearing.
DUBBER ANNUAL REPORT FY23 | 81
FINANCIAL REPORT 11. Contract Liabilities
Current
Non-current
Total
Reconciliation
Reconciliation of the values at the beginning and end of the current and
previous financial year are set out below:
Opening balance
Payments received in advance
2023
$
2022
$
5,541,221
3,952,172
1,389,342
1,269,694
6,930,563
5,221,866
2023
$
2022
$
5,221,867
5,957,477
9,890,964
6,519,340
Transfers to revenue – performance obligations satisfied
(8,182,268)
(7,254,951)
Total
6,930,563
5,221,866
Unsatisfied performance obligations
The aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied was $6,930,563 as at
30 June 2023 ($5,221,866 as at 30 June 2022). These are expected to be recognised as revenue in future periods ranging from 6 –
44 months with the majority to be recognised in the next 24 months.
82 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT 12. Issued Capital
Issued and paid up capital
2023
$
2022
$
309,694,823 (2022: 304,935,427) Ordinary shares – fully paid
292,762,575
285,209,838
Share issue costs written off against share capital
(11,741,778)
(11,741,778)
Total
281,020,797
273,468,060
MOVEMENT IN ORDINARY SHARES ON ISSUE
2023
Issue Price
No. of Shares
$
Balance at the beginning of the year
304,935,427
273,468,060
Issued on exercise of options
$0.75
170,000
127,500
Issued on exercise of ZEPOs
Repayment of loan funded shares
$ -
$ -
4,589,397
7,236,237
-
189,000
Balance at the end of the year
309,694,824
281,020,797
2022
Issue Price
No. of Shares
$
Balance at the beginning of the year
256,200,395
136,947,992
Issued pursuant to a placement
Issued on exercise of options
Issued on exercise of options
Issued on exercise of options
Issued on exercise of options
Issued on acquisition (Notiv)
Issued on acquisition (Speik deferred consideration)
Issued on exercise of ZEPOs
Share issue costs
$2.95
$0.38
$0.75
$1.25
$1.80
$3.75
$3.23
$ -
$ -
37,288,136
110,000,000
425,290
161,610
320,000
240,000
10,000
21,111
12,500
38,000
386,277
1,448,539
4,700,571
15,182,844
5,583,647
13,786,575
-
(4,350,000)
Balance at the end of the year
304,935,427
273,468,060
DUBBER ANNUAL REPORT FY23 | 83
FINANCIAL REPORT OPTIONS
At the end of the year, the following options over unissued ordinary shares were outstanding
Grant Date
Expiry Date
Exercise Price
Number Under Option
1-Dec-20
Various
13-May-20
1-Jun-21
1-Jun-21
30-Sep-21
24-Mar-21
24-Mar-21
6-Aug-21
1-Jun-20
15-Mar-22
15-Mar-22
13-May-21
1-Dec-21
30-Sep-21
3-May-21
3-May-21
3-May-21
22-Sep-22
20-Dec-22
15-Mar-23
31-Jan-23
31-Jan-23
Total
30-Nov-23
30-Jun-25
12-May-24
31-May-24
31-May-24
30-Jun-24
31-Jul-24
31-Jul-24
6-Aug-24
30-Nov-24
31-Mar-25
31-Mar-25
12-May-25
31-Dec-25
30-Jun-26
31-Jan-24
31-Jan-24
31-Jan-24
30-Sep-25
31-Jul-24
31-Mar-26
31-Mar-26
$1.22
$0.00
$1.17
$1.60
$0.00
$0.00
$0.00
$1.75
$0.00
$2.01
$2.01
$0.00
$2.64
$0.00
$0.00
$0.00
$1.80
$1.68
$0.00
$0.00
$0.00
$0.00
30-Jun-25
$0.444
50,000
8,409,723
250,000
100,000
100,000
100,000
51,641
900,000
50,000
125,000
165,000
170,846
250,000
1,570,576
100,000
96,509
434,136
75,000
579,733
96,988
1,870,070
50,000
250,000
15,845,222
As set out in the remuneration report, 1,130,615 share options are expected to be issued as soon as is practicable after
the issuance of the annual report in respect of FY23 short term incentives achieved to be satisfied through the issuance of
share options.
84 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT CAPITAL RISK MANAGEMENT
The group’s objectives when managing capital are to safeguard the ability to continue as a going concern, so that benefits to
stakeholders and an optimum capital structure are maintained.
In order to maintain or adjust the capital structure, the Company may return capital to shareholders, cancel capital, issue new
shares or options or sell assets.
13. Reserves
Option reserve
Performance rights reserve
Foreign currency reserve
Total
OPTION RESERVE
2023
$
2022
$
23,640,847
24,900,638
2,663,035
2,663,035
142,795
(722,118)
26,446,677
26,841,555
The option reserve is used to accumulate amounts received on the issue of options and records items recognised as expenses on
valuation of incentive-based share options and loan funded shares.
Movement in option reserve:
2023
$
2022
$
Balance at the beginning of the year
24,900,638
18,830,803
Allocation of incentive-based share options values over vesting period –
employees and key management personnel
6,550,104
15,513,225
Allocation of incentive-based options values over vesting period – directors
(573,658)
4,439,985
Transfers to issued capital on exercise of options
(7,236,237)
(13,883,375)
Balance at the end of the year
23,640,847
24,900,638
PERFORMANCE RIGHTS RESERVE
The performance rights reserve is used to record the value of performance rights issued as share based payments until the
performance rights are converted into fully paid ordinary shares upon achievement of performance based milestones.
Movement in performance rights reserve:
Balance at the beginning of the year
2023
$
2022
$
2,663,035
2,663,035
Balance at the end of the year
2,663,035
2,663,035
The unvested share reserve is used to record the value of shares formally offered and accepted as share based payments until
the shares are issued on a future specified vesting date.
DUBBER ANNUAL REPORT FY23 | 85
FINANCIAL REPORT FOREIGN CURRENCY RESERVE
The foreign currency reserve is used to record exchange differences arising from the translation of the financial statements of
foreign operations.
Movement in foreign currency reserve:
Balance at the beginning of the year
Currency translation differences
Balance at the end of the year
14. Accumulated Losses
2023
$
2022
$
(722,118)
794,406
864,913
(1,516,524)
142,795
(722,118)
2023
$
2022 (Restated)
$
Balance at the beginning of the year
(185,061,911)
(100,957,232)
Loss attributable to owners of Dubber Corporation Limited
(69,196,571)
(84,104,679)
Balance at the end of the year
(254,258,482)
(185,061,911)
15. Earnings per Share (EPS)
The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share are as follows:
2023
$
2022 (Restated)
$
Earnings attributable to the owners of Dubber Corporation Limited used to calculate EPS
Loss for the year
Weighted average number of ordinary shares used as the denominator in
calculating basic EPS
Basic EPS (cents)
(69,196,571)
(84,104,679)
307,178,949
297,993,197
(22.53)
(28.22)
As the consolidated entity is in a loss position diluted EPS is the same as basic EPS.
86 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT 16. Financial Risk Management
Financial instruments consist mainly of deposits with banks and accounts receivable and payable.
The totals for each category of financial instruments, measured in accordance with AASB 9 as detailed in the accounting policies
to these financial statements, are as follows:
Financial Assets
2023
2022
Note
Weighted Average
Interest Rate (%)
Cash and cash equivalents
Trade and other receivables (incl.
sundry debtors)
Total Financial Assets
Financial Liabilities
Trade and other payables
Lease liability
Total Financial Liabilities
4.93
2.73
-
6.0
0.27
0.56
-
6.0
4
5
9
8
2023
$
2022
(Restated)
$
2,862,626
54,383,974
36,579,929
36,379,671
39,442,555
90,763,645
15,228,203
11,578,418
9,366,105
11,282,569
24,594,308
22,860,988
As the consolidated entity is in a loss position there is no diluted EPS calculated.
FINANCIAL RISK MANAGEMENT POLICIES
Exposure to key financial risks is managed in accordance with the Group’s risk management policy with the objective to ensure
that the financial risks inherent in technological activities and new business reviews are identified and then managed or kept as
low as reasonably practicable.
The main financial risks that arise in the normal course of business are market risk (including currency risk and interest rate risk),
credit risk and liquidity risk. Different methods are used to measure and manage these risk exposures. Liquidity risk is monitored
through the ongoing review of available cash and future commitments for research expenditure. Exposure to liquidity risk is
limited by anticipating liquidity shortages and ensures capital can be raised in advance of shortages. Interest rate risk is managed
by limiting the amount of interest-bearing loans entered into by the Company. It is the Board’s policy that no speculative trading in
financial instruments be undertaken to limit exposure to price risk.
Primary responsibility for identification and control of financial risks rests with the Managing Director, under the authority of the
Board. The Board is apprised of these risks from time to time and agrees any policies that may be undertaken to manage any of
the risks identified.
Details of the significant accounting policies and methods adopted, including criteria for recognition, the basis of measurement
and the basis on which income and expenses are recognised, in respect of each financial instrument are disclosed in Note 1
to the financial statements. The carrying values less the impairment allowance for receivables and payables are assumed to
approximate fair values due to their short-term nature. Cash and cash equivalents are subject to variable interest rates.
DUBBER ANNUAL REPORT FY23 | 87
FINANCIAL REPORT SPECIFIC FINANCIAL RISK EXPOSURES AND MANAGEMENT
(a) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
consolidated entity. The consolidated entity has a strict code of credit, including obtaining agency credit information, confirming
references and setting appropriate credit limits. The consolidated entity obtains guarantees where appropriate to mitigate
credit risk. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount,
net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the
financial statements.
Credit-impaired financial assets
A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of
that financial asset have occurred. Evidence that a financial asset is credit-impaired include:
• significant financial difficulty of the customer;
• a breach of contract;
• it is probable that the customer will enter bankruptcy or other financial reorganisation.
Write-off policy
The Group writes off a financial asset when there is information indicating that the counterparty is in severe financial difficulty
and there is no realistic prospect of recovery. However, financial assets may still be subject to enforcement activities, taking into
account legal advice where appropriate. Any recoveries made are recognised in the profit or loss.
Trade receivables
The Group has adopted the simplified approach to measuring expected credit losses which uses a lifetime expected loss
allowance for all trade receivables. To measure the expected credit losses, trade receivables have been grouped based on shared
credit risk characteristics and the days past due.
The expected loss rates are based on the payment profiles of contracts and corresponding historical credit losses. The historical
loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the
customers to settle the receivables.
On that basis, the loss allowance as at 30 June 2023 was determined as follows for trade receivables:
Financial Assets
Current
More than 30
days past due
More than 60
days past due
Total
Expected loss rate
0%
0%
19%
1%
Gross carrying amount – trade receivables
3,339,869
195,461
292,357
3,827,687
Loss allowance
-
-
55,835
55,835
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include the
failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual payments for a
period greater than 1 year.
88 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT Loss allowance as at 30 June 2022 (Restated) was determined as follows for trade receivables:
Current
More than 30
days past due
More than 60
days past due
Total
Expected loss rate
0%
0%
0%
0%
Gross carrying amount – trade receivables
2,768,374
34,767
741,522
3,544,663
Loss allowance
-
-
-
-
Management have assessed the risk of collections for the amounts more than 60 days past due as low.
The Company believes that The Group’s credit risk on liquid funds is limited because the majority of cash and deposits are held
with Westpac Banking Corporation and National Australia Bank, both AA3 credit rated banks.
(b) Liquidity risk
Liquidity risk arises from the possibility that the Company might encounter difficulty in settling its debts or otherwise meeting its
obligations related to financial liabilities.
Prudent liquidity risk management implies maintaining sufficient cash reserves to meet the ongoing operational requirements
of the business. It is the Company’s policy to maintain sufficient funds in cash and cash equivalents. Furthermore, the Company
monitors its ongoing research and development cash requirements and raises equity funding as and when appropriate to meet
such planned requirements. The Company has undrawn financing facilities. Trade and other payables, the only financial liability of
the Company, are due within 3 months.
The tables below reflect an undiscounted contractual maturity analysis for financial liabilities.
Cash flows realised from financial assets reflect management’s expectation as to the timing of realisation. Actual timing may
therefore differ from that disclosed. The timing of cash flows presented in the table to settle financial liabilities reflects the earliest
contractual settlement dates.
FINANCIAL LIABILITY AND FINANCIAL ASSET MATURITY ANALYSIS
Within 1 Year
1 to 5 Years
>5 years
Total Contractual
Cash Flow
Financial assets –
cash flows receivable
2023
$
2022
$
2023
$
2022
$
2023
$
2022
$
2023
$
2022
$
Trade and other receivables
35,899,957
35,752,092
679,972
627,579
Total expected inflows
35,899,957
35,752,092
679,972
627,579
Financial liabilities due for
payment realisable
Trade and other payables
15,220,693
11,858,559
7,511
7,511
-
-
-
-
-
36,579,929
36,379,671
36,579,929
36,379,671
-
15,228,204
11,866,070
Lease liability
2,895,170
2,951,814
6,641,174
7,722,232
1,324,107
2,531,097
10,860,451
13,205,143
Total anticipated outflows
18,115,863
14,810,373
6,648,685
7,729,743
1,324,107
2,531,097
26,088,655
25,071,213
Net (outflow)/inflow on
financial instruments
17,784,094
20,491,719
(5,968,713)
(7,102,164)
(1,324,107)
(2,531,097)
10,491,274
11,308,458
DUBBER ANNUAL REPORT FY23 | 89
FINANCIAL REPORT
(c) Market risk
(i.)
Interest rate risk
The Company’s cashflow interest rate risk primarily arises from cash at bank and deposits subject to market bank rates. The
Company does not have any borrowings or enter into hedges. An increase/(decrease) in interest rates by 0.5% during the whole
of the respective periods would have led to an decrease/(increase) in losses of less than $100,000.
(ii.) Foreign currency risk
The consolidated Group undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk
through foreign exchange rate fluctuations.
Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities
denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity analysis and cash
flow forecasting.
The carrying amount of the consolidated entity’s foreign currency denominated financial assets and financial liabilities which are
different to the functional currencies of the entities in the group at the reporting date were as follows:
Consolidated
Euros
US dollars
British pounds
Canadian dollars
Others
Total
Assets
Liabilities
2023
$
2022
$
2023
$
2022
$
129,390
266,012
3,021
-
20,400
103,365
773,626
1,346,653
-
1,837
33,684
24,685
-
-
-
-
-
-
-
103,452
183,474
395,899
776,647
1,450,105
The consolidated entity had net financial liabilities denominated in foreign currencies of $593,173 (assets of $183,474 less
liabilities of $776,647) as at 30 June 2023 (2022: $1,060,837 net liability consisting of assets of $395,899 less liabilities of
$1,456,737). In addition, the group has intercompany loan balances which are denominated in foreign currencies different to the
functional currencies of the entities in the group, which have been eliminated on consolidation.
Based on this exposure, had the Australian dollar weakened by 10%/ strengthened by 5% against these foreign currencies with
all other variables held constant, the consolidated entity’s equity and loss before tax for the year would have been $2,795,679
higher/ $1,198,148 lower (2022: $2,175,474 higher/$932,346 lower).
The percentage change is the expected overall volatility of the significant currencies, which is based on management’s assessment
of reasonable possible fluctuations taking into consideration movements over the last 6 months each year and the spot rate at
each reporting date. The actual foreign exchange gain for the year ended 30 June 2023 was $1,422,219 (2022: $113,517 loss),
which includes foreign exchange impact due to intercompany loan balances.
(d) Fair value measurement
The financial instruments recognised at fair value in the statement of financial position have been analysed and classified using a
fair value hierarchy reflecting the significance of the inputs used in making the measurements. The fair value hierarchy consists of
the following levels:
Level 1: Quoted prices in active markets for identical items (unadjusted)
Level 2: Observable direct or indirect inputs other than Level 1 inputs
Level 3: Unobservable inputs (i.e. not derived from market data)
90 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT The classification of an item into the above levels is based on the lowest level of the inputs used that has a significant effect on the
fair value measurement of the item. Transfers of items between levels are recognised in the period they occur.
As at 30 June 2023, there are no financial instruments recognized at fair value in the statement of financial position.
17. Auditors’ Remuneration
Services provided by the auditors of the parent entity and the auditor’s related practices, as well as non-EY audit firms are
categorized as below:
Category 1: Fees paid or payable to the auditor of the parent entity for auditing the statutory financial report of the parent
covering the group, and for auditing statutory reports of any controlled entities.
Category 2: Fees paid or payable for assurance services that are required by legislation and are required by that legislation to be
provided by the auditor of the parent entity.
Category 3: Fees paid or payable for other assurance and agreed-upon procedures services that are required by legislation by
the auditor of the parent or another non-EY audit firm; and
Category 4: Fees paid or payable for other services (including tax compliance).
During the year, the following fees were paid or payable for services provided by the auditor of the parent entity and its related
practices, as well as non-EY audit firms, split for the categories described above:
EY Australia
Non-EY audit firms*
2023
$
2022
$
2023
$
2022
$
285,450
-
285,450
-
-
-
100,000
425,513
34,102
321,949
134,102
747,462
Category 1 fees
Category 4 fees
Total Auditors' Remuneration
*EY Australia were appointed auditors of the Group in FY23.
18. Contingent Liabilities
The Consolidated entity has no material contingent liabilities as at reporting date (2022: Nil).
19. Commitments
The Consolidated entity has no material commitments as at reporting date (2022: Nil).
DUBBER ANNUAL REPORT FY23 | 91
FINANCIAL REPORT 20. Operating Segments
Identification of reportable operating segments
The Group has identified its operating segments based on the internal reports that are reviewed and used by the Board of
Directors (chief operating decision makers) in assessing performance and determining the allocation of resources.
The group has three main operating segments, specifically for the provision of subscriptions services in Europe, United States of
America (‘Americas’) and Rest of World
Intersegment transactions
An internally determined transfer price is set for all inter-segment sales. This price is based on what would be realised in the event
that the sale was made to an external party at arm’s length. All such transactions are eliminated on consolidation. Corporate
charges are recognised in Other segment which contains the treasury and oversight functions of the group.
Intersegment receivables, payables and loans
Segment assets are clearly identifiable on the basis of their nature and physical location.
Liabilities are allocated to segments where there is a direct nexus between the incurrence of the liability and the operations of the
segment. Segment liabilities includes trade and other payables.
Unallocated items
Any items noted below as ‘Other’ are not allocated to operating segments as they are not considered part of the core operations
of any segment in particular.
Major customers
Revenues of $7,993,910 are derived from a single external customer, representing 27% of the total services revenue. These
revenues are attributed to the ‘Europe’ geographical segment.
Revenues by country/region
The consolidated Group’s revenues are derived from the following countries in descending order of significance:
Country
Revenue
(2023)
Revenue
(2022)*
United Kingdom
$
United States
$
Australia
$
Luxembourg
$
Others
$
Total
$
18,289,199
6,641,001
2,453,976
1,235,087
1,410,547
30,029,811
15,179,540
4,595,202
2,402,954
757,800
1,543,042
24,478,538
*Does not include the $8,160,943 reversal of pre-FY22 revenue.
92 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT SEGMENT REPORTING
Year ended 30 June 2023
Segment income
Revenue
Other income
Sub total
Segment expenses
Europe
$
Americas
$
Rest of world
$
Other
$
Total
$
20,383,189
6,977,299
2,669,323
87,901
-
-
20,471,090
6,977,299
2,669,323
-
-
-
-
30,029,811
87,901
30,117,712
13,741,020
Direct costs
5,021,752
2,220,831
6,498,437
Operating expenses
16,428,644
11,449,423
38,636,406
3,536,290
70,050,763
Share based payments
414,568
186,334
3,893,291
1,482,253
5,976,446
Foreign currency (gains)/losses
(40,849)
9,506
(1,390,876)
-
(1,422,219)
Sub total
21,824,115
13,866,094
47,637,258
5,018,543
88,346,010
Earnings before depreciation,
amortisation, impairment,
interest and tax
(1,353,025)
(6,888,795)
(44,967,935)
(5,018,543)
(58,228,298)
Finance income
Finance costs
19,624
-
1,096,444
(526,282)
(19,200)
(249,300)
Impairment of goodwill
(3,504,969)
-
(174,480)
Depreciation and amortisation
(4,495,065)
(223,661)
(3,680,768)
-
-
-
-
1,116,068
(794,782)
(3,679,449)
(8,399,494)
Profit/(Loss) before income tax
(9,859,717)
(7,131,656)
(47,976,039)
(5,018,543)
(69,985,955)
Segment assets
43,272,523
6,232,179
39,794,572
Segment liabilities
17,717,341
2,005,624
16,367,317
Net segment assets
25,555,182
4,226,555
23,427,255
-
-
-
89,299,274
36,090,282
53,208,992
DUBBER ANNUAL REPORT FY23 | 93
FINANCIAL REPORT Year ended 30 June 2022 (Restated)
Europe
$
Americas
$
Rest of world
$
Other
$
Total
$
Segment income
Revenue
16,851,943
5,046,411
2,580,183
Variable revenue reversal
(prior financial year)*
Other income
Sub total
Segment expenses
-
11,450
-
-
(8,160,943)
78,479
16,863,393
5,046,412
(5,502,281)
Direct costs
3,306,049
2,008,566
6,058,806
-
-
-
-
-
24,478,537
(8,160,943)
89,929
16,407,524
11,373,421
Operating expenses
18,438,840
12,036,940
24,847,233
5,530,077
60,853,090
Share based payments
279,837
495,098
10,744,993
8,433,283
19,953,211
Foreign currency (gains) / losses
10,598
14,578
88,341
-
113,517
Sub total
22,035,324
14,555,182
41,739,373
13,963,360
92,293,239
Earnings before depreciation,
amortisation, impairment,
interest and tax
(5,171,931)
(9,508,770)
(47,241,654)
(13,963,360)
(75,885,715)
Finance Income
Finance costs
1,091
(483,784)
-
-
221,728
(1,513,751)
Depreciation and amortisation
(4,690,057)
(151,722)
(2,418,927)
-
-
-
222,819
(1,997,535)
(7,260,706)
Profit/(Loss) before income tax
(10,334,681)
(9,660,492)
(50,952,604)
(13,963,360)
(84,921,137)
Segment assets
54,662,307
3,785,797
90,006,440
Segment liabilities
15,534,718
2,744,693
14,927,429
Net segment assets
39,127,589
1,041,104
75,079,011
-
-
-
148,454,544
33,206,840
115,247,704
* As part of the completion of the financial report for the year ended 30 June 2022, the Company re-assessed the revenue of certain contracts in accordance
with AASB 15. As a result of this re-assessment, certain variable revenues relating to platform fees within customer agreements relating to past periods (i.e.
FY21 and prior financial years) were reversed. These revenues all occurred in the Rest of world segment. Further details are set out in Note 1. 21. Related
Party Transactions
94 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT 21. Related Party Transactions
The Group’s transactions with related parties are set as follows:
SUBSIDIARIES
The consolidated financial statements include the financial statements of Dubber Corporation Limited and the subsidiaries listed
in the following table:
Medulla Group Pty Ltd
Dubber Pty Ltd
Dubber Ltd
Dubber USA Pty Ltd
Dubber, Inc.
Dubber Connect Australia Pty Ltd
CallN Pty Ltd
Aeriandi Ltd
Dubber UK Holdings Ltd
Voxygen Ltd
Pinch Labs, Inc
Pinch Labs Pty Ltd
Country of Incorporation
Class of
Shares
2023 (%)
2022 (%)
Equity Holding
Australia
Ordinary
Australia
Ordinary
England
Ordinary
Australia
Ordinary
United States of America
Ordinary
Australia
Ordinary
Australia
Ordinary
England
Ordinary
England
Ordinary
England
Ordinary
United States of America
Ordinary
Australia
Ordinary
100
100
100
100
100
100
100
100
100
-
100
100
100
100
100
100
100
100
100
100
100
100
100
100
* Voxygen Ltd was liquidated during FY23 with all activities transferred to other Group companies.
PARENT ENTITY
Dubber Corporation Limited is the ultimate Australian parent entity and ultimate parent of the Group.
KEY MANAGEMENT PERSONNEL
Refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration paid or payable to each
member of Dubber Corporation Limited’s key management personnel for the year ended 30 June 2023.
The totals of remuneration paid to key management personnel of the Company during the year are as follows:
Short-term employee benefits
Long-term benefits
Post-employment benefits
Share-based payments
Total
2023
$
2022
$
3,458,364
2,772,377
75,162
186,331
215,181
182,641
(289,843)
10,312,714
3,430,014
13,482,913
DUBBER ANNUAL REPORT FY23 | 95
FINANCIAL REPORT OTHER TRANSACTIONS WITH KEY MANAGEMENT PERSONNEL
Telephony services totaling $2,193 (2022: $2,195) were provided by Canard Pty Ltd, a company associated with Mr Steve
McGovern. Trade payables at 30 June 2023 include a balance of $183 (30 June 2022: $1,095) payable to Canard Pty Ltd. Intelligent
Voice and 1300 MY SOLUTION are businesses associated with Mr Steve McGovern. The Group earned service fee income of
$38,281 (2022: $58,844) from Intelligent Voice and $28,959 (2022: $57,511) from 1300 MY SOLUTION.
Other receivables at 30 June 2023 includes an amount of $nil (30 June 2022: $100,977) receivable from the Medulla Group Pty Ltd
vendors, including Mr Steve McGovern and Mr James Slaney.
All transactions are conducted on normal commercial terms and on an arm’s length basis.
22. Cash Flow Information
Reconciliation of loss for the year to net cash flows from operating activities:
Profit/(Loss) before tax
Non-cash flows in loss:
2023
$
2022 (Restated)
$
(69,985,955)
(84,921,137)
Depreciation and amortisation
8,399,494
7,260,706
Impairment of goodwill
Share based payments
Net exchange differences
Changes in assets and liabilities:
3,679,449
-
5,976,446
19,953,211
(1,422,219)
113,517
(Increase)/decrease in trade and other receivables
(1,657,656)
16,700,654
(Increase)/decrease payables and contract liabilities
4,562,560
(7,975,848)
Increase in provisions
268,207
6,662,949
Net cash outflows from operating activities
(50,179,674)
(42,205,948)
NON-CASH FINANCING AND INVESTING ACTIVITIES
In FY22, 386,277 fully paid ordinary shares at $3.75/share were issued as part of the consideration for the acquisition of the Notiv
asset in September 2021.
96 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT 23. Share Based Payments
VALUE OF SHARE BASED PAYMENTS IN THE FINANCIAL STATEMENTS
Expensed – directors and other key management personnel remuneration:
Employee options
Fully paid ordinary shares
Loan funded shares
Sub total
Expensed – other employees’ and consultants:
Fully paid ordinary shares
Employee options
Sub total
Total
2023
$
2022
$
(187,560)
10,312,715
-
-
-
-
(187,560)
10,312,715
-
-
6,164,006
9,640,496
6,164,006
9,640,496
5,976,446
19,953,211
DUBBER ANNUAL REPORT FY23 | 97
FINANCIAL REPORT
OPTIONS
Set out below are the summaries of options granted as share based payments:
2023
Grant
Date
Expiry
Date
Exercise
Price
Balance
01/07/22
Granted
Exercised
Expired or
Forfeited
Balance
30/06/23
Number
vested and
exercisable
20/09/2019
20/09/2022
$1.25
20/09/2019
20/09/2022
$0.75
31/03/2020
22/03/2023
$0.75
01/06/2020
30/11/2024
$2.01
01/07/2020
30/06/2025
$0.00
60,000
150,000
890,000
125,000
808,851
30/11/2020
30/06/2025
$0.00
3,879,066
01/12/2020
30/11/2023
$1.22
24/03/2021
31/07/2024
$0.00
24/03/2021
31/07/2024
$1.75
03/05/2021
31/01/2024
$1.80
03/05/2021
31/01/2024
$1.68
13/05/2021
12/05/2024
$1.17
13/05/2021
12/05/2025
$2.64
01/06/2021
31/05/2024
$0.00
01/06/2021
31/05/2024
$1.60
50,000
140,676
900,000
411,050
75,000
250,000
250,000
100,000
100,000
08/06/2021
30/06/2025
$0.00
2,244,421
19/07/2021
30/06/2023
$0.00
19/07/2021
30/06/2025
$0.00
26/07/2021
31/01/2024
$0.00
26/07/2021
31/01/2024
$1.80
06/08/2021
06/08/2023
$0.00
100,000
250,000
121,509
23,086
50,000
06/08/2021
06/08/2024
$0.00
100,000
20/08/2021
30/06/2025
$0.00
1,231,811
30/09/2021
30/06/2025
$0.00
30/09/2021
30/06/2026
$0.00
30/09/2021
30/06/2024
$0.00
400,000
100,000
100,000
01/12/2021
31/12/2025
$0.00
2,392,708
15/03/2022
31/03/2025
$2.01
15/03/2022
31/03/2025
$0.00
13/05/2022
30/09/2025
$0.00
22/09/2022
30/09/2025
$0.00
21/11/2022
31/07/2024
$1.75
21/11/2022
N/A**
$0.00
31/01/2023
31/03/2026
$0.00
31/01/2023
30/06/2025
$0.44
20/03/2023
N/A**
$0.00
15/03/2023
31/03/2026
$0.00
165,000
610,791
125,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(100,000)
-
(25,000)
-
(50,000)
(50,000)
-
-
-
-
(822,132)
-
(439,945)
(125,000)
1,201,238
(621,505)
600,000
96,988
50,000
250,000
-
-
-
-
140,589
(140,589)
3,666,140
(1,796,070)
-
(60,000)
(150,000)
-
(20,000)
(870,000)
-
-
-
-
-
-
-
-
(404,426)
-
-
-
-
-
125,000
125,000
808,851
808,851
3,474,640
3,474,640
50,000
(29,678)
(59,357)
51,641
(600,000)
300,000
50,000
51,641
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
411,050
411,050
75,000
75,000
250,000
250,000
250,000
250,000
100,000
100,000
100,000
100,000
2,244,421
2,244,421
-
-
250,000
250,000
96,509
23,086
-
96,509
23,086
-
50,000
50,000
1,231,811
1,231,811
400,000
100,000
100,000
-
100,000
100,000
1,570,576
1,570,576
165,000
165,000
170,846
170,846
-
-
579,733
579,733
600,000
600,000
96,988
50,000
96,988
50,000
250,000
250,000
-
-
1,870,070
1,870,070
Total
16,203,969
6,004,955
(4,774,345)
(1,587,357)
15,845,222
15,145,222
Weighted average exercise price
$0.31
$0.19
$0.03
$1.12
$0.27
$0.25
** Restricted Stock Units have no expiry date.
98 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT 2022
Grant
Date
Expiry
Date
Exercise
Price
Balance
01/07/21
Granted
Exercised
Expired or
Forfeited
Balance
30/06/22
Number
vested and
exercisable
15/01/2019
15/01/2022
$0.38
20/09/2019
20/09/2022
$1.25
455,290
70,000
20/09/2019
20/09/2022
$0.75
150,000
31/03/2020
22/03/2023
$0.75
1,210,000
-
-
-
-
01/06/2020
30/11/2024
$2.01
01/07/2020
30/06/2025
$0.00
-
-
125,000
808,851
(455,290)
(10,000)
-
(320,000)
-
-
(1,250,000)
(322,985)
-
-
-
-
-
50,000
153,241
(12,565)
900,000
-
-
-
-
250,000
250,000
100,000
100,000
2,244,421
(718,854)
(21,111)
-
-
-
-
-
-
1,187,035
(1,187,035)
400,000
(300,000)
250,000
-
305,129
(183,620)
23,086
-
100,000
(50,000)
100,000
-
454,062
(454,062)
1,231,811
400,000
100,000
-
-
-
185,000
(85,000)
2,532,573
(139,865)
165,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
60,000
60,000
150,000
150,000
890,000
890,000
125,000
125,000
808,851
808,851
-
-
3,879,066
-
-
-
50,000
50,000
140,676
140,676
900,000
-
-
-
411,050
411,050
75,000
75,000
250,000
250,000
250,000
250,000
100,000
100,000
100,000
100,000
2,244,421
-
-
-
100,000
100,000
250,000
-
121,509
121,509
23,086
50,000
23,086
50,000
100,000
100,000
-
1,231,811
400,000
100,000
100,000
-
-
-
-
-
2,392,708
230,215
165,000
165,000
30/11/2020
30/06/2021
$0.00
1,250,000
30/11/2020
30/06/2023
$0.00
322,985
30/11/2020
30/06/2025
$0.00
3,879,066
01/12/2020
30/11/2023
$1.22
24/03/2021
31/07/2024
$0.00
24/03/2021
31/07/2024
$1.75
-
-
-
03/05/2021
31/01/2024
$0.00
718,854
03/05/2021
31/01/2024
$1.80
432,161
03/05/2021
31/01/2024
$1.68
75,000
13/05/2021
12/05/2024
$1.17
13/05/2021
12/05/2025
$2.64
01/06/2021
31/05/2024
$0.00
01/06/2021
31/05/2024
$1.60
08/06/2021
30/06/2025
$0.00
08/06/2021
30/06/2023
$0.00
19/07/2021
30/06/2023
$0.00
19/07/2021
30/06/2025
$0.00
26/07/2021
31/01/2024
$0.00
26/07/2021
31/01/2024
$1.80
06/08/2021
06/08/2023
$0.00
06/08/2021
06/08/2024
$0.00
20/08/2021
30/06/2023
$0.00
20/08/2021
30/06/2025
$0.00
30/09/2021
30/06/2025
$0.00
30/09/2021
30/06/2026
$0.00
30/09/2021
30/06/2024
$0.00
01/12/2021
31/12/2025
$0.00
15/03/2022
31/03/2025
$2.013
15/03/2022
31/12/2025
$0.00
15/03/2022
31/03/2025
$0.00
13/05/2022
30/09/2025
$0.00
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
96,061
(16,012)
(80,049)
-
-
1,055,066
(444,275)
125,000
-
-
-
610,791
610,791
125,000
-
Total
8,563,356
13,691,336
5,970,674
(80,049)
16,203,969
4,811,178
Weighted average exercise price
$0.26
$0.25
$0.08
$0.00
$0.31
$0.70
The assessed fair values of the options were determined using a binomial option pricing model or Black-Scholes model, taking into account the exercise price,
term of option, the share price at grant date and expected price volatility of the underling share, expected yield and the risk-free interest rate for the term of
the option. For the options granted during the current and previous financial year, the inputs to the model used were:
DUBBER ANNUAL REPORT FY23 | 99
FINANCIAL REPORT Granted to Key Management Personnel during the year ended 30 June 2023:
Grant date
Number of options/RSUs
Number of shares
Vesting date
21-Nov-22
21-Nov-22
96,988
600,000
-
-
30-Jun-23
30-Jun-24
Expense recognised in FY23 ($)
$33,946
$11,001
Exercise price ($)
Dividend yield (%)
Probability of target
Expected volatility (%)
Risk-free interest rate (%)
Fair value per option/ share
Expected life of options (years)
Grant date
Number of options/RSUs
Number of shares
Vesting date
$0
-
100%
100%
3.11%
$0.35
1.69
$1.75
-
100%
100%
3.11%
$0.05
1.69
15-Mar-23
15-Mar-23
492,308
300,000
-
-
31-Mar-23
31-Mar-23
Expense recognised in FY23 ($)
$103,385
$63,000
$0
-
$0
-
100%
100%
88.60%
88.60%
3.12%
$0.21
3.04
3.12%
$0.21
3.04
Exercise price ($)
Dividend yield (%)
Probability of target
Expected volatility (%)
Risk-free interest rate (%)
Fair value per option/ share
Expected life of options (years)
100 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT Zero Exercise Price Options granted to Employees during the year ended 30 June 2023:
Grant date
22-Sep-22
31-Jan-23
31-Jan-23
15-Mar-23
Number of options
1,201,238
50,000
250,000
2,873,832
Number of shares
-
-
-
-
Vesting date
30-Sep-22
30-Jun-23
30-Jun-23
31-Mar-23
Expense recognised in FY23 ($)
$660,681
$19,750
$46,275
$603,505
Exercise price ($)
Dividend yield (%)
Probability of target
Expected volatility (%)
Risk-free interest rate (%)
Fair value per option/ share
Expected life of options (years)
$0
-
100%
100%
3.41%
$0.55
3.02
$0
-
100%
83%
3.22%
$0.40
2.41
$0.444
-
100%
83%
3.22%
$0.19
2.41
Restricted Stock Units (RSUs) granted to Employees during the year ended 30 June 2023:
Grant date
Number of options
Number of shares
Vesting date
Expense recognised in FY23 ($)
Exercise price ($)
Dividend yield (%)
Probability of target
Expected volatility (%)
Risk-free interest rate (%)
Fair value per option/ share
Expected life of options (years)
$0
-
100%
89%
3.12%
$0.21
3.04
20-Mar-23
140,589
-
31-Mar-23
$26,009
$0
-
100%
87%
3.12%
$0.19
3.03
The various deferred vesting options listed above are subject to milestones or vesting dates. Probability of achieving these milestones or vesting dates have
been assessed at 100% unless otherwise stated.
The weighted average remaining contractual life of share-based payment options that were outstanding as at 30 June 2023 was 1.98 years (2022: 2.75 years).
The weighted average fair value of share-based payment options granted during the year was $0.26 (2022: $0.05).
DUBBER ANNUAL REPORT FY23 | 101
FINANCIAL REPORT 24. Parent Entity Disclosures
SUMMARY FINANCIAL INFORMATION
The individual financial statements for the parent entity show the following aggregate amounts:
Statement of financial position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Loss for the year
2023
$
2022 (Restated)
$
1,306,770
46,751,477
54,329,896
70,782,947
55,636,666
117,534,424
2,366,696
1,886,119
60,977
400,601
2,427,673
2,286,720
53,208,993
115,247,704
281,020,799
273,473,707
25,472,251
26,922,514
(253,284,057)
(185,148,517)
53,208,993
115,247,704
(7,282,288)
(13,569,937)
Total comprehensive loss
(7,282,288)
(13,569,937)
The parent entity had no capital commitments or contingent liabilities at 30 June 2023 or 30 June 2022.
25. Events Subsequent to Year End
The Company issued 46,371,531 shares on 2nd August 2023 to raise $6,492,000 (net of issue costs) and a further 46,421,531
shares on 12 September to raise $2,456,000 (net of costs) as part of the capital raise announced in July 2023. The Company
also issued 1,510,619 shares to satisfy option exercises under the Company’s ESOP plan between 1 July 2023 and the date of
this report.
No other matters or circumstances have arisen since the end of the financial year.
102 | DUBBER ANNUAL REPORT FY23
FINANCIAL REPORT Directors’
Declaration
The directors of the Company declare that:
1. The financial statements and notes are in accordance with the Corporations Act 2001, and:
i.
comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting
requirements; and
ii.
give a true and fair view of the financial position of the Company as at 30 June 2023 and of its performance for the
financial year ended on that date.
2. The Managing Director and Chief Financial Officer have each declared that:
i.
the financial records of the Company for the financial year have been properly maintained in accordance with section
286 of the Corporations Act 2001;
ii.
the financial statements and notes for the financial year comply with the accounting standards; and
iii. the financial statements and notes for the financial year give a true and fair view.
3.
In the opinion of the directors’ there are reasonable grounds to believe that the Company will be able to pay its debts as
and when they become due and payable.
4.
Note 1 confirms that the financial statements also comply with International Financial Reporting Standards as issued by
the International Accounting Standards Board.
This declaration is made in accordance with a resolution of the Board of Directors.
D
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Neil Wilson
Chairman
Dated: 20 September 2023
DUBBER ANNUAL REPORT FY23 | 103
Independent
Auditor's Report
104 | DUBBER ANNUAL REPORT FY23
INDEPENDENT AUDITOR'S REPORT PAGE 1 | INDEPENDENT AUDITOR'S REPORT
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
GPO Box 67 Melbourne VIC 3001
Tel: +61 3 9288 8000
Fax: +61 3 8650 7777
ey.com/au
Independent auditor’s report to the members of Dubber Corporation Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Dubber Corporation Limited (the Company) and its subsidiaries
(collectively the Group), which comprises the consolidated statement of financial position as at 30
June 2023, the consolidated statement of profit or loss and other comprehensive income,
consolidated statement of changes in equity and consolidated statement of cash flows for the year
then ended, notes to the financial statements, including a summary of significant accounting policies,
and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations
Act 2001, including:
a. Giving a true and fair view of the consolidated financial position of the Group as at 30 June 2023
and of its consolidated financial performance for the year ended on that date; and
b. Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional
Accountants (including Independence Standards) (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with
the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial report of the current year. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide
a separate opinion on these matters. For each matter below, our description of how our audit
addressed the matter is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the
financial report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of
material misstatement of the financial report. The results of our audit procedures, including the
procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying financial report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
DUBBER ANNUAL REPORT FY23 | 105
INDEPENDENT AUDITOR'S REPORT
PAGE 2 | INDEPENDENT AUDITOR'S REPORT
Revenue recognition
Why significant
The Group recognised $30.0m of revenue for the year ended
30 June 2023.
We considered revenue recognition to be a Key Audit Matter
given its significance to the financial report and being a key
performance measure for the Group.
In addition, the Group restated its 2022 comparative
revenue following necessary adjustments identified during
the year ended 30 June 2023.
Going concern
Why significant
At 30 June 2023, the Group had cash and cash equivalents
of $2.8m plus $30.0m of term deposits and had incurred net
cash outflows used in operating activities of $50.2m for the
year ended 30 June 2023.
As disclosed in Note 1 to the financial report, the directors
concluded that there are reasonable grounds to believe the
Group can continue as a going concern. The Group’s
financial statements were accordingly prepared on a going
concern basis.
In making this assessment the Directors gave consideration
to forecast cash flows reflecting the Group’s recent
restructure involving significant headcount reduction,
continued observable growth in monthly subscription
revenues and the receipt of additional equity of $6.1m in
July 2023.
Given the historical results of the Group, considerable audit
effort was directed to assessing the cashflow forecasts that
supported the Directors’ going concern assessment.
Accordingly, we considered this to be a Key Audit Matter.
How our audit addressed the key audit matter
Our audit procedures included the following:
►
► We assessed whether the Group’s revenue recognition
accounting policies were in accordance with Australian
Accounting Standards.
For a sample of revenue transactions for the provision
of services, we confirmed price and quantities with the
customer or agreed to transaction documents such as
service orders.
For a sample of revenue entries, we examined service
period dates on customer invoices and the terms of
customer contracts to determine whether revenue was
recorded in the correct period in accordance with
Australian Accounting Standards.
►
► We recalculated the Group’s calculation of revenue
relating to subsequent periods and that was deferred at
balance date.
► We assessed the Group’s calculation of prior period
revenue amounts that were required to be restated and
the presentation of the restatement in the financial
report.
► We considered the adequacy of the disclosures in
respect of revenue in the financial report.
How our audit addressed the key audit matter
Our audit procedures included the following:
► Considered the assumptions supporting the cashflow
forecasts used in the going concern assessment and
agreed these to the Board approved budget for the year
ending 30 June 2024 and management forecasts after
30 June 2024.
► We considered a range of sensitivities in the cash flow
model to assess impact on available cash.
► We agreed the receipt of the $6.1m of equity raised in
July 2023 to bank statement.
► Considered the disclosures made in Note 1 of the
financial report.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
106 | DUBBER ANNUAL REPORT FY23
INDEPENDENT AUDITOR'S REPORT
PAGE 3 | INDEPENDENT AUDITOR'S REPORT
Impairment assessment of goodwill and intangible assets
Why significant
How our audit addressed the key audit matter
At 30 June 2023, the Group held $38.0m in goodwill and
other identifiable intangible assets (relating to customer and
technology assets).
Our audit procedures included the following:
► Assessed the appropriateness of the methodology
applied to estimate recoverable amount.
As outlined in Note 7 of the financial report, impairment
testing is performed by the Group annually to support the
carrying value of goodwill and for other finite life intangibles
where there are indicators of impairment.
► Assessed the key inputs and assumptions including
board approved cash flows, discount rates and growth
rates adopted in the estimated recoverable amount.
► Evaluated whether the Group’s determination of its
The recoverable amount of both the Europe and Rest of
World (RoW) cash generating units (CGUs) was primarily
determined using a value in use approach that used cash
flow projections from financial budgets approved by the
Board for the year ending 30 June 2024, and then projected
forward to cover an eight-year period. The Group also
assessed the Fair Value Less Cost of Disposal of these CGUs
based on observed market multiples calculated by an
independent valuer and performed a cross check to its own
market capitalisation.
Impairment charges of $3.5m and $0.2m were recognised in
the Europe and RoW CGUs respectively.
As this process involved estimates and significant judgments
regarding forecast future cash flow projections, discount
rates, growth rates and terminal values, as well as the
material balances of the assets assessed, we considered this
to be a Key Audit Matter.
Cash Generating Units (CGUs) was in accordance with
Australian Accounting Standards.
► Assessed the allocation of assets including corporate
assets to the relevant CGUs.
► Compared the cash flows used in the assessment to the
actual and budgeted financial performance of the
underlying CGUs.
► Assessed Fair Value Less Cost of Disposal based on
multiples derived from observable external market data
of comparable listed entities, where available.
► Assessed the reasonableness of the Group’s sensitivity
analysis around the key assumptions to determine
whether any reasonably possible changes would result
in an impairment where no impairment had been
recognised.
► Assessed the adequacy of the disclosures made in the
financial report.
Our valuation specialists were involved in the conduct of
these procedures where appropriate.
Information other than the financial report and auditor’s report thereon
The directors are responsible for the other information. The other information comprises the
information included in the Company’s 2023 annual report, but does not include the financial report
and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report
and our related assurance opinion.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
DUBBER ANNUAL REPORT FY23 | 107
INDEPENDENT AUDITOR'S REPORT
PAGE 4 | INDEPENDENT AUDITOR'S REPORT
Responsibilities of the directors for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgment and maintain professional scepticism throughout the audit. We also:
►
Identify and assess the risks of material misstatement of the financial report, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
► Obtain an understanding of internal control relevant to the audit 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 Group’s internal control.
► Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
► Conclude on the appropriateness of the directors’ use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in
our auditor’s report to the related disclosures in the financial report or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up
to the date of our auditor’s report. However, future events or conditions may cause the Group to
cease to continue as a going concern.
► Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events
in a manner that achieves fair presentation.
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
108 | DUBBER ANNUAL REPORT FY23
INDEPENDENT AUDITOR'S REPORT
PAGE 5 | INDEPENDENT AUDITOR'S REPORT
DUBBER ANNUAL REPORT FY23 | 109
INDEPENDENT AUDITOR'S REPORTA member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation ► Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion. We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated to the directors, we determine those matters that were of most significance in the audit of the financial report of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on the audit of the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2023. In our opinion, the Remuneration Report of Dubber Corporation Limited for the year ended 30 June 2023, complies with section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Ernst & Young David Petersen Partner Melbourne 20 September 2023 Shareholder
Information
ADDITIONAL SHAREHOLDER INFORMATION
The following additional information is current as at 18 September 2023.
CORPORATE GOVERNANCE
The Company’s corporate governance statement is available on the Company’s website at:
www.dubber.net/investors/investor-centre
DISTRIBUTION OF EQUITY SECURITIES
Holding ranges
Holders
Total units
above 0 up to and including 1,000
above 1,000 up to and including 5,000
above 5,000 up to and including 10,000
above 10,000 up to and including 100,000
above 100,000
Totals
3,770
3,399
1,197
2,087
1,788,772
8,688,224
9,201,597
69,593,253
491
287,669,312
% IC
0.47%
2.30%
2.44%
18.46%
76.32%
10,944
376,941,158
100.00%
There are 6,466 shareholders with less than a marketable parcel.
SUBSTANTIAL SHAREHOLDERS
Name
Number of Shares % of total Shares on Issue
Tiga Trading Pty Ltd (i)
Thorney Technologies Ltd (i)
28,796,950
28,796,950
9.36%
9.36%
(i) Mutual relevant interest as disclosed in substantial shareholder notices.
VOTING RIGHTS
Each fully paid ordinary share carries voting rights of one vote per share.
ON-MARKET BUYBACK
There is no current on-market buyback.
110 | DUBBER ANNUAL REPORT FY23
SHAREHOLDER INFORMATION ANNUAL GENERAL MEETING
The company advises that the Annual General Meeting (AGM) of the company is scheduled for 29 November 2023. Details of the
meeting will be provided at a later date.
Further to Listing Rule 3.13.1 and Listing Rule 14.3, nomination for election of directors at the AGM must be received not less than
35 Business Days before the meeting, being no later than 10 October 2023.
TOP 20 HOLDERS OF ORDINARY SHARES
Position
Holder Name
UBS NOMINEES PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CITICORP NOMINEES PTY LIMITED
VENN MILNER SUPERANNUATION PTY LTD
STEVE MCGOVERN NOMINEES PTY LTD
Holding
36,835,724
25,733,609
9,864,697
6,800,000
6,605,038
ONE MANAGED INVESTMENT FUNDS LIMITED
5,693,198
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
FISHERS STORES MANAGEMENT PTY LTD
JALSU PTY LTD
BOSTON FIRST CAPITAL PTY LTD
FISHERS SUPERMARKETS PTY LTD
MOSCH PTY LTD
PARALYSED PTY LTD
MRS DIANA MICALE
GE EQUITY INVESTMENTS PTY LTD
TDF PROPERTIES PTY LTD
STEPHEN MCGOVERN
RICHARD GERMAIN AND NINA GERMAIN
RICHARD GERMAIN AND NINA GERMAIN
FISHERS SUPERMARKETS PTY LTD
4,517,920
3,637,000
3,400,000
3,300,000
3,096,500
2,509,524
2,330,000
2,055,000
2,017,500
1,815,000
1,802,632
1,748,000
1,680,000
1,673,620
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Total
% IC
9.77%
6.83%
2.62%
1.80%
1.75%
1.51%
1.20%
0.96%
0.90%
0.88%
0.82%
0.67%
0.62%
0.55%
0.54%
0.48%
0.48%
0.46%
0.45%
0.47%
127,114,962
33.72%
Total issued capital - selected security class(es)
376,941,158
100.00%
DUBBER ANNUAL REPORT FY23 | 111
SHAREHOLDER INFORMATION UNQUOTED EQUITY SECURITIES
Number
Number of holders
Class
Holder
165,000
125,000
100,000
8,159,723
250,000
80,398
434,136
75,000
50,000
100,000
100,000
148,629
900,000
250,000
250,000
1,670,070
50,000
170,846
686,068
539,733
100,000
4
1
1
3
1
44
15
1
1
1
1
2
2
1
1
86
1
50
10
36
1
Unlisted options exercisable at $2.013 expiring 31 March 2025
Unlisted options exercisable at $2.013 expiring 30 November 2024
Unlisted ZEPOs expiring 30 June 2024
Unlisted ZEPOs expiring 30 June 2025
Unlisted options exercisable at $0.444 expiring 30 June 2025
Unlisted ZEPOs expiring 31 January 2024
Unlisted options exercisable at $1.80 expiring 31 January 2024
Unlisted options exercisable at $1.68 expiring 31 January 2024
Unlisted options exercisable at $1.21 expiring 30 November 2023
Unlisted options exercisable at $1.60 expiring 31 May 2024
Unlisted ZEPOs expiring 31 May 2024
Unlisted ZEPOs expiring 31 July 2024
Unlisted options exercisable at $1.75 expiring 31 July 2024
Unlisted options exercisable at $1.165 expiring 12 May 2024
Unlisted options exercisable at $2.64 expiring 12 May 2025
Unlisted ZEPOs expiring 31 March 2026
Unlisted ZEPOs expiring 6 August 2024
Unlisted ZEPOs expiring 31 March 2025
Unlisted ZEPOs expiring 31 December 2025
Unlisted ZEPOs expiring 30 September 2025
Unlisted ZEPOs expiring 30 June 2026
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
EIP
All unquoted equity securities relating to the Company’s Incentive Plans.
112 | DUBBER ANNUAL REPORT FY23
SHAREHOLDER INFORMATION Corporate
Directory
BOARD OF DIRECTORS
AUDITOR
Ernst & Young
8 Exhibition Street
Melbourne VIC 3000 Australia
SECURITIES EXCHANGE
Dubber Corporation Limited shares are listed
on the Australian Securities Exchange
ASX Code: DUB
PRINCIPAL PLACE OF BUSINESS
AND REGISTERED OFFICE:
Level 5-7, 2 Russell Street
Melbourne VIC 3000 Australia
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Neil Wilson
Non-Executive Chairman
Steve McGovern
CEO & Managing Director
Peter Pawlowitsch
Executive Director
Gerard Bongiorno
Non-Executive Director
Sarah Diamond
Non-Executive Director
COMPANY SECRETARY
David Franks
SHARE REGISTRY
Automic Registry Services (Automic Pty Ltd)
Level 5, 191 St Georges Terrace
Perth WA 6000 Australia
Telephone: +61 8 9324 2099
DUBBER ANNUAL REPORT FY23 | 113
INVESTOR RELATIONS
Simon Hinsley
simon.hinsley@dubber.net
+61 (0) 401 809 653
Dubber Corporation Limited
ABN: 64 089 145 424
dubber.net
AUSTRALIA
Melbourne
Level 5-7, 2 Russell Street,
Melbourne VIC 3000,
Australia
Sydney
Level 14, 50 Pitt Street,
Sydney NSW 2000,
Australia
Brisbane
Level 3, 293 Queen Street,
Brisbane QLD 4000,
Australia
UNITED KINGDOM
London
Ground Floor
60 Charlotte Street
London W1T 2NU, UK
Oxford
Ground Floor West
King Charles House, Oxford
OX1 1JD, UK
NORTH AMERICA
Dallas
Level 12, Suite 1200,
2828 N Harwood St, Dallas,
TX 75201, USA