2023
Annual Report
PRIDE IN EVERY EGG
Farm Pride Foods Ltd
Farm Pride Foods Limited and Controlled Entities
Corporate Information
Farm Pride Foods Ltd.
ABN 42 080 590 030
Directors
George Palatianos (Non-Executive Chairman)
Malcolm Ward (Non-Executive Director)
Bruce De Lacy (Non-Executive Director)
Darren Lurie (Managing Director)
Management Team
Darren Lurie (Managing Director)
Tony Enache (Chief Financial Officer)
Company Secretary
Bruce De Lacy
Registered office and principal place of business
551 Chandler Road
Keysborough, Victoria 3173
+61 3 9798 7077
Solicitors
Gadens
Level 25 Bourke Place
600 Bourke Street
Melbourne, Victoria 3000
Financiers
MC FP Pty Ltd
Level 18, 90 Collins Street
Melbourne, Victoria 3000
Tradeplus24 Australia
Level 2, 696 Bourke St
Melbourne, Victoria 3000
Share Registry
Computershare Registry Services Pty. Ltd.
Yarra Falls, 452 Johnston Street
Abbotsford, Victoria 3067
ASX: FRM
Auditors
Pitcher Partners
Level 13, 664 Collins Street
Docklands, Victoria 3008
Internet Address
www.farmpride.com.au
1
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
TABLE OF CONTENTS
Chairman’s Report
Directors’ Report
Auditor’s Independence Declaration
Financial Report for the year ended 30 June 2023
Consolidated Statement of Profit or Loss and Other Comprehensive
Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Directors’ Declaration
Independent Auditor’s Report
ASX Additional Information
3
4
18
19
20
21
22
23
51
52
57
2
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
Chairman’s Report
2023 has been a year of change. The appointment of 2 directors in August 2022 who helped steer us
through change, Bruce Delacy as interim CEO, capital raised from the NREO and Placement, new
CEO and director appointed in February, further changes to reduce the board size and appointments
of industry experienced Operations Manager and Chief Financial Officer.
The Group’s net revenue from contracts with customers increased by 12% to $82.78 million (2022:
$74.04 million). Revenue for the second half of FY23 was $44.58 million an increase of 17% from the
first half of FY23.
The Group incurred a loss after-tax of $9.11 million (2022: $19.78 million loss).
Earnings before interest, tax, depreciation and amortisation (EBITDA) was a loss of $0.2 million
(2022: $4.62 million loss). The EBITDA in the second half of FY23 of $2.61 million represented a
significant turnaround in the financial performance of the Group.
During the second half of FY23, there was significant focus on improving farming activities,
production, grading, and processing efficiencies, across the business. The re-instatement of our
owned rearing facilities is progressing well with the first birds to be transferred to our laying farms in
coming weeks. This is expected to reduce costs and achieve improved egg production. A number of
new farm managers have been appointed as well as improvements in our farming operations. With
greater focus across our grading floors and product plant improvements have also been achieved with
further improvements identified.
Cost pressures, like all businesses, remain high including labour, utilities, transport, feed and interest.
We have sought to reduce unit costs by increasing efficiencies and obtain price increases to off-set
these higher costs.
In December 2022 we exited a large leased cage egg farm. While this is part of the Group’s strategy
to transition to non-cage production, occurring during a time of national shortage impacted egg supply
and our ability to meet additional customer demand.
The Group has entered into a contract of sale for a parcel of surplus non-arable land at Lethbridge,
Geelong which on the satisfaction of a number of pre-conditions will deliver proceeds of $2.35 million,
the majority of which will be applied to debt reduction.
The Board thanks all our customers and suppliers for their continued support and our employees
who are working hard to ensure the successful turnaround in the profitability of the Group.
George Palatianos
Chairman
30 August 2022
3
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
The directors present their report together with the financial report of the consolidated entity consisting
of Farm Pride Foods Limited (‘the Company’) and the entities it controlled (the ‘group’), for the
financial year ended 30 June 2023 and auditor’s report thereon.
Directors
The names of directors in office at any time during or since the end of the year are:
George Palatianos
Malcolm Ward
Bruce De Lacy
Darren Lurie
Peter Bell
Beth Mathison
Roland Roccioletti
Non-executive Director, Chair
Non-executive Director
Non-executive Director
Managing Director
Non-executive Director (appointed 30 May 2008, resigned 17 November
2022)
Independent Non-executive Director (appointed 25 August 2022, resigned 9
March 2023)
Independent Non-executive Director (appointed 25 August 2022, resigned 9
March 2023)
The directors have been in office since the start of the year to the date of this report unless otherwise
stated.
Principal activities
The principal activities of the group during the financial year were the production, processing,
manufacturing and sale of eggs and egg products.
There has been no significant change in the nature of these activities during the financial year.
Review of operations and financial results
Statutory consolidated net profit after tax attributable to the members of Farm Pride Foods Ltd
(“Statutory Profit”) for the year ended 30 June 2023 was a loss of $9.112 million (2022: $19.782
million loss). Earnings before interest, tax, depreciation and amortisation (EBITDA) was a loss of
$0.205 million (2022: $4.615 million loss).
The following table reconciles the Statutory Profit to EBITDA for the year ended 30 June 2023:
Statutory (loss)
Add back:
- Interest (finance costs)
- Income tax (benefit) / expense
- Depreciation
EBITDA
30 June 2023
$’000
30 June 2022
$’000
(9,112)
(19,782)
2,518
-
6,389
(205)
2,177
5,827
7,163
(4,615)
For further discussion of the review and results of operations of the group reference should be made to
the Chairman’s Report dated 30 August 2023.
Significant changes in the state of affairs
There have been no significant changes in the group’s state of affairs during the financial year, other
than as disclosed in this report.
4
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
Subsequent Events
There are no matters or circumstances which have arisen since 30th June 2023 that have significantly
affected or may significantly affect the operations of the Group, the results of those operations or the
state of affairs of the group in future financial periods.
Environmental regulation
The Group’s operations are not subject to any significant environmental, Commonwealth or State
regulations or laws. The group is not aware of any significant breaches of environmental regulations
during the financial year.
Dividend paid, recommended and declared
No dividends were paid, declared or recommended since the start of the financial year.
Share options and performance rights granted to directors and officers
Options and performance rights over unissued ordinary shares granted during or since the end of the
financial year to directors and any of the 5 most highly remunerated officers of the Company (other than
the directors) as part of their remuneration, are outlined in the following table:
Darren Lurie (Managing Director)
2,180,000
3,600,000
Number of performance rights
granted
Number of options
granted
Unissued shares under options and performance rights
There are 545,000 unissued shares under performance rights that are outstanding at the date of the
directors’ report.
Tranche
Number of performance rights
Exercise Price
Vesting Date
1
545,000
-
23rd August 2023
Shares issued on exercise of options:
No shares or interests were issued during or since the end of the financial year as a result of the
exercise of an option over unissued shares or interest.
Information on directors and company secretary
The qualifications, experience and special responsibilities of each person who has been a director
of Farm Pride Foods Limited at any time during the year and up to the date of this report is provided
below, together with details of the company secretary as at the year end.
Peter Bell
Non-executive Chairman - Appointed 30 May 2008, Member of the Audit Committee until 22 November
2018, Resigned 17 November 2022
Peter has been involved at all levels of the egg industry for more than 50 years. He continues to be
directly involved in the management of commercial egg farms as well as a contributor to industry
and regulatory agencies.
He is a director of AAA Egg Company Pty Ltd and its subsidiary West Coast Eggs Pty Ltd, Days Eggs
Pty Ltd and Pure Foods Eggs Pty Ltd. These companies are egg producers and marketers in
Western Australia, South Australia and Tasmania.
5
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
George Palatianos
Non-executive Chairman – Appointed 23 February 2023
George is a highly experienced Investment Director and Group CFO. He has held prominent roles in
major organisations within various business sectors including agri-business, construction, property
investment and finance. These roles include Group CFO of the Costa Group, Hickory Construction
Group Commercial Director of Prudential Equity Partners and Director of Integration and Growth at
MaxCap Group.
Malcolm Ward
Non-executive Director – Appointed 30 May 2008, Chair of the Audit Committee
Malcolm has been in the egg industry for over 30 years having owned and operated cage and free-
range farms and has served on industry related boards in the area of farm management and feed
supply. He is also a director of AAA Egg Company Pty Ltd and its subsidiary West Coast Eggs Pty Ltd
as well as being a director on a number of other private companies. Malcolm is the Managing Director
of his family’s independent supermarkets and also has commercial interests in property. He is also a
director of Australian United Retailers Limited, appointed 17 November 2010.
Bruce De Lacy
Non-executive director– Appointed 30 November 2018, Member of the Audit Committee –
Appointed 22 November 2018, Company Secretary – Appointed 16 December 2022
Bruce has extensive experience in the egg industry and has previously been employed in a number of
positions at the Company including Chief Executive Officer, General Manager and Chief Operating
Officer.
Darren Lurie
Managing Director – Appointed 23 February 2023
Darren is a former non-executive director and Chair of Farm Pride. He is an experienced leader of
businesses and management teams and has previously held positions as Managing Director, Chair
and CFO in a number of companies, including ASX listed company Optiscan Imaging Ltd (ASX:OIL)
and EduCo International Group.
Darren has 15 years’ experience as a corporate advisor leading finance, strategy and merger and
acquisition assignments across a range of finance and investor communities.
Beth Mathison
Independent Non-executive director – Appointed 25 August 2022, Resigned 9 March 2023
Beth has more than 35 years’ Executive Management and Director experience in Australia, the UK
and Asia. She has worked across a range of industry sectors including Telecommunications,
Logistics, Aquaculture, Hospitality, Tourism, Manufacturing and Retail. Beth has held non-executive
director positions across commercial and not for profit organizations. She is a Fellow of AICD, IML
and GIA and in 2015, was named the Telstra Tasmanian Businesswoman of the Year and
Entrepreneur of the Year.
Roland Roccioletti GAICD ESCI
Independent Non-executive director – Appointed 25 August 2022, Resigned 9 March 2023
Mr Roccioletti has over 25 years corporate advisory experience in company growth, leadership,
research, economic development, finance, digital transformation, business turnarounds, mergers and
acquisitions. He is a former CEO and Managing Director influencing Australia’s economic credentials
across global industrial, commercial, FMCG, packaging, agriculture, wine, dairy, education, not-for-
profit, tourism and racing.
Robin Donohue
Company Secretary– Appointed 25 August 2022, Resigned 16 December 2022
6
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
Directors’ meetings
Board of Directors
Audit Committee
Eligible to
attend
Attended
Eligible to
attend
Attended
Peter Bell
Malcolm Ward
Bruce De Lacy
Beth Mathison
Roland Roccioletti
George Palatianos
Darren Lurie
6
13
13
8
8
5
5
Directors’ interests in shares
6
13
12
7
7
5
5
-
4
4
-
-
-
-
-
4
3
-
-
-
-
Directors’ relevant interests in shares of Farm Pride Foods Limited or options over shares in the
Company are detailed below:
Ordinary
shares of
Farm Pride
Foods
Limited
2,064,250
3,809,576
2,214,748
-
-
21,818,182
Options over
shares in Farm
Pride Foods
Limited
Rights over
shares in Farm
Pride Foods
Limited
-
-
-
-
-
-
-
-
-
-
-
-
14,545,454
3,600,000
2,180,000
Peter Bell
Malcolm Ward
Bruce De Lacy
Beth Mathison
Roland Roccioletti
George Palatianos
Darren Lurie
Malcolm Ward and Peter Bell have an indirect interest in the 43,519,979 shares held by West Coast
Eggs Pty Ltd (2022: 27,486,302 shares) and the 1,584 shares held by Southern Egg Pty Ltd (2022:
1,000).
Indemnification and Insurance of directors and officers
During the financial year, the Company has paid premiums to insure each of the Directors and
Officers against liabilities for costs and expenses incurred by them in defending any legal
proceedings arising out of their conduct while acting in the capacity of Director or Officer of the
Company.
Under the Directors and Officers Liability Insurance Policy the company shall not release to any third party or
otherwise publish details of the nature of the liabilities insured by the policy or the amount of the premium.
Accordingly, the Group relies on section 300 (9) of the Corporations Act 2001 to exempt it from the
requirement to disclose the nature of the liability insured against and the premium amount of the policy.
7
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
Proceedings on behalf of the company
No person has applied for leave of Court to bring proceedings on behalf of Farm Pride Foods Limited or
any of its subsidiaries.
Auditor’s independence declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations
Act 2001 in relation to the audit for the financial year is provided within this report.
Indemnification of auditors
No indemnities have been given or insurance premiums paid during or since the end of the financial
year for the auditors of the Group.
Non-audit services
Non-audit services are approved by resolution of the Audit and Risk Committee and approval is
provided in writing to the board of directors. Non-audit services were provided by the auditors of
entities in the consolidated group during the year, namely Pitcher Partners (Melbourne), network firms
of Pitcher Partners, and other non-related audit firms, as detailed below. The directors are satisfied
that the provision of the non-audit services during the year by the auditor is compatible with the
general standard of independence for auditors imposed by the Corporations Act 2001 for the following
reasons:
all non-audit services were subject to the corporate governance procedures adopted by Farm
Pride Foods Ltd and have been reviewed and approved by the Audit and Risk Committee to
ensure they do not impact on the integrity and objectivity of the auditor; and
the non-audit services provided do not undermine the general principles relating to auditor
independence as set out in APES 110 Code of Ethics for Professional Accountants (including
independence Standards), as they did not involve reviewing or auditing the auditor’s own work,
acting in a management or decision making capacity for Farm Pride Foods Ltd or any of its
related entities, acting as an advocate for Farm Pride Foods Ltd or any of its related entities, or
jointly sharing risks and rewards in relation to the operations or activities of Farm Pride Foods Ltd
or any of its related entities.
Amounts paid and payable to Pitcher Partners (Melbourne) for non-audit services:
Taxation services
40,109
21,940
2023
$
2022
$
Rounding of amounts
In accordance with ASIC Corporations (Rounding in Financial/Director’s Reports) Instrument
2016/191, the amounts in the Directors’ report and in the Financial Report have been rounded to
the nearest thousand dollars, or in certain cases, to the nearest dollar (where indicated).
Remuneration Report (Audited)
The directors present the group’s 2023 remuneration report which details the remuneration
information for Farm Pride Foods Limited’s key management personnel (‘KMP’) in accordance with
the Corporations Act 2001 and its Regulations (‘Remuneration Report’). The Remuneration Report
has been audited by Farm Pride Foods Ltd external auditors, Pitcher Partners.
8
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
(a)
Key management personnel
The Remuneration Report discloses the remuneration arrangements and outcomes for people listed
in the table below who are those individuals who have been determined as KMP as defined by AASB
124 Related Party Disclosures.
Name
Non-Executive
Directors
Peter Bell
Malcolm Ward
Position
Term as KMP
Non-executive Chairman
Non-executive Director
Until 16 November 2022
Full financial year
Bruce De Lacy
Non-executive Director
Interim Managing Director
1 July 2022 to 27 September 2022 and
from 23 February 2023
27 September 2022 to 23 February
2023
Company Secretary
From 16 December 2022
Beth Mathison
Non-executive Director
25 August 2022 to 9 March 2023
Roland Roccioletti
Non-executive Director
25 August 2022 to 9 March 2023
George Palatianos
Non-executive Director
From 23 February 2023
Executive Directors
Darren Lurie
Senior Executives
Tony Enache
Managing Director
From 23 February 2023
Group Chief Financial Officer
From 26 April 2023
Daryl Bird
Group Chief Executive Officer
Resigned 27 December 2022
Robin Donohue
Group Chief Financial Officer, (appointed
Company Secretary 25 August 2022)
Resigned 16 December 2022
(b)
Remuneration policy
The performance of the group depends upon the quality of its directors and executives. To be
successful, the group must attract, motivate and retain highly skilled directors and executives. To this
end, the group adopts the following principles in its remuneration framework:
–
–
–
–
–
–
Provide competitive rewards to attract high caliber executives;
Link executive rewards to the performance of the group and the creation of shareholder value;
Establish appropriate performance hurdles for variable executive remuneration;
Meet the Group’s commitment to a diverse and inclusive workplace;
Promote the Group as an employer of choice;
Comply with relevant legislation and corporate governance principles.
In accordance with best practice corporate governance, the structure of non-executive director and
executive remuneration is separate and distinct.
9
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
The board of directors are responsible for determining and reviewing compensation arrangements for
directors and executives. The board of directors assess the appropriateness of the nature and amount
of remuneration of directors and executives on a periodic basis by reference to relevant market
conditions, as well as whether performance targets have been met, with the overall objective of
ensuring maximum shareholder benefit from the retention of a high-quality board and executives.
(c)
Use of Remuneration Consultants
To ensure the board of directors are fully informed when making remuneration decisions, the group
seeks external remuneration advice. Remuneration consultants are engaged by, and report directly
to, the board of directors. In selecting remuneration consultants, the Board of directors considers
potential conflicts of interest and requires independence from the group’s key management personnel
and other executives as part of their terms of engagement.
During the year ended 30 June 2023, the group engaged Simon Hare of Hare Group as an external
remuneration consultant.
Simon Hare (consultant) made a recommendation on the reasonableness of the proposed
–
Managing Director’s remuneration which included options, base salary, super and performance rights.
–
–
The consultant didn’t provide any other kind of advice to the Group for the financial year.
$1,980 was paid to the consultant for the remuneration recommendation.
The recommendation report was prepared by the independent consultant prior to the
–
engagement of the new Managing Director and was presented to the board to ensure that the making
of the remuneration recommendation would be free from undue influence by the new Managing
Director.
The board was satisfied that the remuneration recommendation was made free from undue
–
influence by the new Managing Director as it was prepared by an independent consultant prior to the
engagement of the new Managing Director.
(d)
Non-Executive Director Remuneration
Objective
The board aims to set aggregate remuneration at a level which provides the group with the ability to
attract and retain directors of the highest calibre, whilst incurring a cost which is acceptable to
shareholders.
Structure
The group’s Constitution and the ASX Listing Rules specify the aggregate remuneration of non-
executive directors shall be determined from time to time by a general meeting. An amount not
exceeding the amount determined is then divided between the directors as agreed.
The cap on aggregate non-executive director’s remuneration (which requires shareholder approval),
and the manner in which it is apportioned amongst non-executive directors, is reviewed annually. The
board will consider advice from external consultants as well as fees paid to non-executive directors of
comparable companies when undertaking the annual review process.
Non-executive directors receive fees and do not receive share-based remuneration or bonus
payments.
Superannuation contributions are made by the Group on behalf of non-executive directors in line with
statutory requirements and are included in the remuneration package amount allocated to individual
directors.
The remuneration of non-executive directors for the year ended 30 June 2023 is detailed in the table
titled KMP Remuneration on page 12 (the ‘Remuneration Table’).
10
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
(e)
Executive Remuneration
Objective
The group aims to reward executives with a level and mix of remuneration commensurate with their
position and responsibilities within the group. This involves:
– Rewarding executives for company, business unit and individual performance against targets
set by reference to appropriate benchmarks
Aligning the interest of executives with those of shareholders
Linking reward with the strategic goals and performance of the group
Ensuring total remuneration is competitive by market standards.
–
–
–
Structure
In determining the level and make-up of executive remuneration, the board of directors engage
external consultants on market levels of remuneration for comparable roles. Remuneration consists of
the following key elements:
–
–
Fixed remuneration
Variable remuneration.
The proportion of fixed remuneration and variable remuneration is established for each executive by
the board of directors. The variable portion consists of a short-term cash bonus which is performance-
based and is disclosed separately in the Remuneration Table.
The board of directors also considers current market conventions with regards to the splits between
fixed, short-term and long-term incentive elements.
Fixed Remuneration
Objective
The level of fixed remuneration is set to provide an appropriate and market-competitive base level of
remuneration. Fixed remuneration is reviewed annually by the board of directors consisting of a
review of group, business and individual performance, relevant comparative remuneration in the
market and internal and external advice on policies and practices where necessary.
Structure
Total fixed remuneration (‘TFR’) is the non-variable component of an executive’s annual
remuneration. It consists of the base salary plus any superannuation contributions paid to a complying
super fund on the executive’s behalf, and the cost (including any component for fringe benefits tax) for
other items such as novated vehicle lease payments.
Linking remuneration to performance - variable remuneration
Remuneration is linked to performance to retain high calibre executives by motivating them to achieve
performance goals which are designed to increase shareholders value.
Variable remuneration
Objective
The objective of executive variable remuneration is to link executive remuneration to the achievement
of the group’s annual operational and financial targets through a combination of both company and
individual performance targets.
Structure
Variable remuneration is expressed as a percentage of a participant’s TFR comprising base salary,
superannuation contributions and may include other non-cash benefits, and are based on the
achievement of group-wide budgeted revenue and profit targets each financial year and individual
performance targets at the board’s discretion.
For executives, the group provides a remuneration package that incorporates annual cash bonuses,
payable at the discretion of the board of directors.
11
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v
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
(h)
Shareholdings of KMP
Balance
1 July 2022
Received as
remuneration
Options
exercised
Peter Bell
Malcolm Ward
Bruce De Lacy
Beth Mathison
Roland Roccioletti
Daryl Bird
Robin Donohue
George Palatianos
Darren Lurie
2,064,250
2,031,772
195,502
-
-
-
-
-
-
-
4,291,524
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Other
On market
purchases,
placement/
(sales)
-
1,777,804
2,019,246
-
-
-
-
Balance
30 June 2023
2,064,250
3,809,576
2,214,748
-
-
-
-
21,818,182
14,545,454
-
21,818,182
14,545,454
-
40,160,686
44,452,210
Malcolm Ward and Peter Bell have an indirect interest in the 43,519,979 shares held by West Coast Eggs Pty Ltd
(2022: 27,486,302 shares) and the 1,584 shares held by Southern Egg Pty Ltd (2022: 1,000).
(i)
Other transactions with KMP
The value of transactions (inclusive of GST) and amounts receivable/(payable) between directors and their related
entities and Farm Pride Foods Limited and its controlled entities.
Director related entities
Transaction
Revenue
Expenditure
Days Eggs Pty Ltd1
(P. Bell)
Pure Foods Eggs Pty Ltd1
(P. Bell)
West Coast Eggs Pty Ltd1
(P. Bell / M. Ward)
AAA Egg Company Pty Ltd1
(P. Bell / M. Ward)
Oakmeadow Pty Ltd1
(M. Ward)
Morago Holdings Pty Ltd1
(P. Bell)
Siamje Pty Ltd2
(D. Lurie)
Egg supply /
Purchases
Egg sales
Egg sales /
Purchases
Egg
Purchases/
Loan Interest
Loan Interest
Loan Interest
Consulting
2023
$’000
2022
$’000
8
-
-
6
2023
$’000
223
-
2022
$’000
-
-
Balance
Receivable /
(Payable)
2023
$’000
2022
$’000
(52)
-
-
-
141
803
331
138
(46)
62
-
-
-
-
-
-
-
-
12
6
17
84
-
-
-
-
-
-
-
-
-
-
-
-
1 Peter Bell and Malcolm Ward through their related entities provide birds, eggs and egg products to and acquire eggs, egg product and
packaging from Farm Pride Foods Limited and its controlled entities. Peter Bell and Malcolm Ward through their related entities also provided
unsecured interest-bearing loans during the year. Director’s administrative expenses are reimbursed at cost. These transactions are on
normal trading terms and conditions. Peter Bell resigned as director in September 2022.
2 Darren Lurie through his related entity provided consulting services prior to his appointment to the Company.
Transactions in the above table represent related party transactions for the full financial year from July ‘22 – June ’23 and comparatives for
July ’21 - June ’22.
15
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
(j)
Service Agreements
The contracts for service between the group and executives are on a continuing basis, the terms of which are not
expected to change in the immediate future. Remuneration and other terms of employment for key management
personnel are formalised in service agreements as follows:
Managing Director
Darren Lurie is the Managing Director of the Company appointed on 23 February 2023. Darren is employed under
a standard employment contract with no defined length of tenure. Under the terms of his employment contract:
Darren may resign from his position by providing the group with six months written notice,
The group may terminate this agreement by providing six months written notice or provide payment in lieu
of the notice period, or the unexpired part of any notice period,
The group may terminate at any time without notice if serious misconduct has occurred,
Darren is awarded share options and performance rights that vest upon the satisfaction of specified
performance conditions.
Details of Darren Lurie’s salary are detailed in the Remuneration Table.
Chief Financial Officer
Tony Enache is the Chief Financial Officer of the Company appointed 26 April 2023. Tony is employed under a
standard employment contract with no defined length of tenure.
Tony may resign from his position by providing the group with six weeks written notice,
The group may terminate this agreement by providing six weeks written notice or provide payment in lieu
of the notice period, or the unexpired part of any notice period,
The group may terminate at any time without notice if serious misconduct has occurred.
Details of Tony Enache’s salary are detailed in the Remuneration Table.
(k)
Revenue and Other Income
The group’s revenue, profit before tax and earnings per share for the last five financial years is presented in the table
below:
Revenue
Net (loss)/profit before tax
Net (loss)/profit after tax
Share price at end of year in dollars
Basic (loss)/earnings cents per share
Diluted (loss)/earnings cents per share
2023
$’000
82,842
(9,112)
(9,112)
0.12
(9.89)
(9.89)
2022
$’000
76,577
2021
$’000
76,991
(13,955)
(14,518)
(19,782)
(11,971)
0.115
(35.85)
(35.85)
0.42
(21.69)
(21.69)
2020
$’000
90,327
(3,099)
(2,169)
0.27
(3.93)
(3.93)
2019
$’000
86,641
(5,324)
(3,858)
0.21
(6.99)
(6.99)
16
Farm Pride Foods Limited and Controlled Entities
Directors’ Report
Voting and comments made at the company’s 2022 Annual General Meeting (AGM)
At the company’s most recent AGM, a resolution to adopt the prior year remuneration report was put to the vote and
at least 75% of votes were cast as ‘yes’ for adoption of that report. No comments were made on the remuneration
report that was considered at the AGM.
This is the end of the audited remuneration report.
Signed in accordance with a resolution of the directors.
George Palatianos
Director
Melbourne
30 August 2023
17
FARM PRIDE FOODS LIMITED
AUDITOR’S INDEPENDENCE DECLARATION
TO THE DIRECTORS OF FARM PRIDE FOODS LIMITED
In relation to the independent audit for the year ended 30 June 2023, to the best of my knowledge and
belief there have been:
(i)
(ii)
No contraventions of the auditor independence requirements of the Corporations Act 2001; and
No contraventions of APES 110 Code of Ethics for Professional Accountants (including Independence
Standards).
This declaration is in respect of Farm Pride Foods Limited and its controlled entities during the year.
STEPHEN SCHONBERG
Partner
Date: 30 August 2023
PITCHER PARTNERS
Melbourne
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
pitcher.com.au
Farm Pride Foods Limited and Controlled Entities
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Revenue and other income
Revenue from contracts with customers
Interest revenue and other income
Less: Expenses
Changes in inventories of finished goods and work in progress
Raw materials and consumables used
Employee benefits expense
Depreciation
Impairment of property, plant and equipment
Loss on disposal of property, plant & equipment and lease
assets
Finance costs
Other expenses
(Loss) before income tax
Income tax (expense)
(Loss) from continuing operations
(Loss) for the year
Notes
4
4
5
5
5
5
5
5
6
2023
$’000
82,781
61
82,842
(307)
(59,922)
(18,635)
(6,389)
-
(46)
(2,518)
(4,137)
2022
$’000
74,040
2,537
76,577
310
(56,770)
(16,568)
(7,163)
(4,754)
-
(2,177)
(3,410)
(9,112)
(13,955)
-
(9,112)
(9,112)
(5,827)
(19,782)
(19,782)
Total comprehensive (loss) for the period
(9,112)
(19,782)
Basic (loss) per share (cents per share)
Diluted (loss) per share (cents per share)
19
19
(9.89)
(9.89)
(35.85)
(35.85)
The above statement should be read in conjunction with the accompanying notes.
19
Farm Pride Foods Limited and Controlled Entities
Consolidated Statement of Financial Position
Notes
21
8
9
10
11
12
10
6
13
14
15
14
16
17
16
14
17
18
20
2023
$’000
1,987
8,619
4,545
9,662
757
1,822
2022
$’000
2,150
7,920
4,851
5,897
1,919
-
27,392
22,737
349
-
21,838
6,336
28,523
403
-
25,513
10,091
36,007
55,915
58,744
14,327
3,305
190
1,874
19,696
15,624
15,429
115
31,168
50,864
5,051
12,560
4,535
-
1,829
18,924
11,575
18,705
177
30,457
49,381
9,363
34,307
29,578
71
-
(29,327)
(20,215)
5,051
9,363
Current Assets
Cash and short-term deposits
Trade and other receivables
Inventories
Biological assets
Other current assets
Assets held for sale
Total current assets
Non-current assets
Biological assets
Deferred tax assets
Property, plant and equipment
Lease assets
Total non-current assets
TOTAL ASSETS
Current liabilities
Trade and other payables
Lease liabilities
Borrowings
Provisions
Total current liabilities
Non-current liabilities
Borrowings
Lease liabilities
Provisions
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Share option reserve
Retained losses
The above statement should be read in conjunction with the accompanying notes.
20
Farm Pride Foods Limited and Controlled Entities
Consolidated Statement of Changes in Equity
Contributed
equity
Share
Option
Reserve
Retained
losses
Total
$’000
$’000
$’000
$’000
29,578
-
-
4,877
(148)
34,307
29,578
-
-
29,578
-
-
-
-
-
71
71
-
-
-
-
(20,215)
(9,112)
(9,112)
9,363
(9,112)
(9,112)
-
-
-
(29,327)
(433)
(19,782)
(19,782)
(20,215)
4,877
(148)
71
5,051
29,145
(19,782)
(19,782)
9,363
Balance as at 1 July 2022
Loss for the year
Total comprehensive income
Transactions with owners in their
capacity as owners
Issue of ordinary shares
Shares issue costs
Share based payments
Balance as at 30 June 2023
Balance as at 1 July 2021
Loss for the year
Total comprehensive income
Balance as at 30 June 2022
The above statement should be read in conjunction with the accompanying notes.
21
Farm Pride Foods Limited and Controlled Entities
Consolidated Statement of Cash Flows
Notes
2023
$’000
2022
$’000
Cash flow from operating activities
Receipts from customers
Payments to suppliers and employees
Finance costs paid
Net cash (used in) operating activities
21
Cash flow from investing activities
Proceeds from sale of property, plant and equipment
Payment for property, plant and equipment
Net cash provided by/(used in) investing activities
Cash flow from financing activities
Proceeds from Issue of new shares net of transaction costs
Repayment of borrowings
Proceeds from borrowings
Repayment of lease liabilities
Net cash provided by/ (used in) financing activities
Net (decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of the year
Cash and cash equivalents at end of the year
21
88,959
(89,945)
(2,417)
(3,403)
6
(529)
(523)
4,729
(4,510)
8,050
(4,506)
3,763
(163)
2,150
1,987
77,776
(79,458)
(2,052)
(3,734)
18,117
(1,342)
16,775
-
(7,277)
-
(4,899)
(12,176)
865
1,285
2,150
The above statement should be read in conjunction with the accompanying notes.
22
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Note 1: Summary of significant accounting policies
The following is a summary of significant accounting policies adopted by the consolidated entity in the
preparation and presentation of the financial report. The accounting policies have been consistently
applied, unless otherwise stated. Farm Pride Foods Limited (the Company or parent entity) is a for
profit company limited by shares incorporated in Australia whose shares are publicly traded on the
Australian Stock Exchange.
(a) Basis of preparation of the financial report
This financial report is a general-purpose financial report, which has been prepared in accordance
with the requirements of the Corporations Act 2001, Australian Accounting Standards and other
authoritative pronouncements of the Australian Accounting Standards Board (AASB).
The financial report has been prepared under the historical cost convention, as modified by
revaluations to fair value for certain classes of assets as described in the accounting policies.
The financial report is presented in Australian dollars.
The financial report was authorised for issue by the directors as at 30 August 2023.
Compliance with International Financial Reporting Standards (IFRS)
The consolidated financial statements of Farm Pride Foods Ltd also comply with the International
Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board
(IASB).
Significant accounting estimates
The preparation of the financial report requires the use of certain estimates and judgements in
applying the consolidated entity’s accounting policies. Those estimates and judgements significant
to the financial report are disclosed in Note 2.
(b) Going concern
The financial report has been prepared on the basis that the Group is a going concern, which
assumes continuity of normal business activities and the realisation of assets and the settlement of
liabilities in the ordinary course of business.
During the year ended 30 June 2023 (FY23) the Group incurred a net loss after tax of $9.112 million
(2022: loss $19.782 million). The Group incurred a net loss of $7.430 million in the first half of FY23
and a loss of $1.682 million in the second half of FY23. This improved financial performance in the
second half of FY23 was also reflected in the EBITDA of the Group which improved from negative
$2.813 million in the first half of FY23 to positive $2.608m in second half of FY23. Net cash flow from
operating activities was an outflow of $3.403 million (2022: cash outflow $3.734 million). As at 30
June 2023 current assets of $27.392 million exceeded current liabilities of $19.696 million by $7.696
million. (2022: current assets of $22.737 million exceed current liabilities of $18.924 million by $3.813
million). Borrowings of $15.624 million (2022 $11.575 million) are classified as non-current. The
Group raised $4.877m before costs by way of a non-renounceable entitlement offer and placement to
sophisticated investors during FY23.
As described in Note 16 the Group has three debt facilities at 30 June 2023 providing funding of up
to $16.881 million. These facilities were drawn to $15.814 million as at 30 June 2023. The facilities
expire on 31 August 2024. Whilst at this time renewal is not certain, the directors have no reason to
believe the facilities will not be renewed based on achieving the Group’s forecasts over the next 12
months. In determining the basis for preparation of the financial report, the directors have assessed
the financial performance, future operating plans, financial forecasts, existing financial position and
recent equity raising by the Group. The directors believe there are reasonable grounds to expect
the Group to be able to continue as a going concern for at least 12 months from the date of issue of
the financial report, which contemplates continuity of normal business activities and the realisation
of assets and the settlement of liabilities in the ordinary course of business. It is acknowledged
however that there are uncertainties associated with the forecast assumptions including the ability
to maintain and grow revenues, contain, and further reduce costs.
23
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
The Group is continuing to review its operations to identify further efficiencies, cost savings and
revenue opportunities. A number of these have already been identified and implemented with
benefits starting to be realised and reflected in the improved trading results in the second half of
FY23. Further benefits are expected to be realised in FY24. As a result of the above, the directors
have concluded that the going concern basis is appropriate.
Given the circumstances detailed above, as well as the potential impacts of changing supply and
demand conditions affecting the Australian egg and grain industry more broadly, there exists
uncertainty that could cast doubt on the ability of the Group to continue as a going concern and
therefore, whether it will be able to realise its assets and extinguish its liabilities in the normal
course of business, and at the amounts stated in the financial report.
(c) Biological assets
Biological assets comprise flocks of hens. As there is no active market for flocks of hens, the
biological assets are recorded based upon the capitalised cost of the flock less accumulated
amortisation. The cost is amortised over the productive life of the flock. This is between 50 and 60
weeks. The flocks are held for the purposes of producing eggs.
(d) Borrowing costs
Borrowing costs are expensed as incurred, except for borrowings directly incurred as part of the cost
of the construction of a qualifying asset, in which case the costs are capitalised until the asset is ready
for its intended use or sale. Borrowing costs include interest expense calculated using the effective
interest method, finance charges in respect of finance leases and exchange differences arising from
foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs
and other costs that an entity incurs in connection with its borrowing of funds.
(e) Cash and cash equivalents
Cash and cash equivalents include cash on hand and at banks short term deposits with an original
maturity of three months or less held at call with financial institutions, and bank overdrafts. Bank
overdrafts are shown within borrowings in current liabilities on the consolidated statement of
financial position.
(f) Employee benefits
Short term employee benefit obligations
Liabilities arising in respect of wages and salaries, annual leave, accumulated sick leave and any
other employee benefits (other than termination benefits) expected to be settled wholly before twelve
months after the end of the annual reporting period are measured at the (undiscounted) amounts
based on remuneration rates which are expected to be paid when the liability is settled. The expected
cost of short-term employee benefits in the form of compensated absences such as annual leave is
recognised in the provision for employee benefits. All other short-term employee benefit obligations
are presented as payables in the consolidated statement of financial position.
Other long-term employee benefit obligations
The provision for other long-term employee benefits, including obligations for long service leave and
annual leave, which are not expected to be settled wholly before twelve months after the end of the
reporting period, are measured at the present value of the estimated future cash outflow to be made in
respect of the services provided by employees up to the reporting date. Expected future payments
incorporate anticipated future wage and salary levels, duration of service and employee turnover, and
are discounted at rates determined by reference to market yields as the end of the reporting period on
high quality corporate bonds that have maturity dates that approximate the terms of the obligations.
Any re-measurements for changes in assumptions of obligations for other long-term employee
benefits are recognised in profit or loss in the period in which the change occurs.
Other long-term employee benefit obligations are presented as current liabilities in the balance sheet if
the entity does not have an unconditional right to defer settlement for at least twelve months after the
reporting date, regardless of when the actual settlement is expected to occur. All other long-term
employee benefit obligations are presented as non-current liabilities in the statement of financial
position.
24
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(g) Events after the reporting period
Events after the reporting period are those events, favourable or unfavourable, that occur between the
end of the reporting period and the date when the financial report is authorised for issue.
The amounts recognised in the financial statements reflect events after the reporting period that
provide evidence of conditions that existed at the reporting date. Whereas events after the reporting
period that are indicative of conditions that arose after the reporting period (i.e. which did not exist at
the reporting date) are excluded from the determination of the amounts recognised in the financial
statements.
(h) Financial instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised when the group becomes party to the
contractual provisions of the instrument. For financial assets, this is equivalent to the date that the
group commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted).
Financial instruments are initially measured at fair value adjusted for transaction costs, except where the
instrument is classified as fair value through profit or loss, in which case transaction costs are
immediately recognised as expenses in profit or loss.
Classification of financial assets
Financial assets recognised by the group are subsequently measured in their entirety at either amortised
cost or fair value, subject to their classification and whether the group irrevocably designates the
financial asset on initial recognition at fair value through other comprehensive income (FVtOCI) in
accordance with the relevant criteria in AASB 9.
Financial assets not irrevocably designated on initial recognition at FVtOCI are classified as
subsequently measured at amortised cost, FVtOCI or fair value through profit or loss (FVtPL) on the
basis of:
(a)
(b)
The group’s business model for managing the financial assets; and
The contractual cash flow characteristics of the financial asset.
Classification of financial liabilities
Financial liabilities classified as held-for-trading, contingent consideration payable by the group for the
acquisition of a business, and financial liabilities designated at FVtPL, are subsequently measured at fair
value.
All other financial liabilities recognised by the group are subsequently measured at amortised cost.
Trade and other receivables
Trade and other receivables arise from the group’s transactions with its customers and are normally
settled within 30 days.
Consistent with both the group’s business model for managing the financial assets and the contractual
cash flow characteristics of these assets, trade and other receivables are subsequently measured at
amortised cost.
Impairment of financial assets
The following financial assets are tested for impairment by applying the ‘expected credit loss’
impairment model:
(a)
debt instruments measured at amortised cost;
(b)
debt instruments classified at fair value through other comprehensive income; and receivables
from contracts with customers, contract assets and lease receivables.
The group applies the simplified approach under AASB 9 to measuring the allowance for credit losses
for receivables from contracts with customers, contract assets and lease receivables. Under the AASB
9 simplified approach, the group determines the allowance for credit losses for receivables from
25
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
contracts with customers, contract assets and lease receivables on the basis of the lifetime expected
credit losses of the financial asset. Lifetime expected credit losses represent the expected credit
losses that are expected to result from default events over the expected life of the financial asset.
The group determines expected credit losses based on the group’s historical credit loss experience,
adjusted for factors that are specific to the financial asset as well as current and future expected
economic conditions relevant to the financial asset. When material, the time value of money is
incorporated into the measurement of expected credit losses. There has been no change in the
estimation techniques or significant assumptions made during the reporting period.
The group has identified contractual payments more than 365 days past due as default events for the
purpose of measuring expected credit losses. These default events have been selected based on the
group’s historical experience. Because contract assets are directly related to unbilled work in
progress, contract assets have a similar credit risk profile to receivables from contracts with
customers. Accordingly, the group applies the same approach to measuring expected credit losses of
receivables from contracts with customers as it does to measuring impairment losses on contract
assets.
The measurement of expected credit losses reflects the group’s ‘expected rate of loss’, which is a
product of the probability of default and the loss given default, and its ‘exposure at default’, which is
typically the carrying amount of the relevant asset. Expected credit losses are measured as the
difference between all contractual cash flows due and all contractual cash flows expected based on the
group’s exposure at default, discounted at the financial asset’s original effective interest rate.
Financial assets are regarded as ‘credit-impaired’ when one or more events have occurred that have a
detrimental impact on the estimated future cash flows of the financial asset. Indicators that a financial
asset is ‘credit-impaired’ include observable data about the following:
(a)
(b)
(c)
(d)
significant financial difficulty of the issuer or the borrower;
breach of contract;
the lender, for economic or contractual reasons relating to the borrower’s financial difficulty, has
granted concessions to the borrower that the lender would not otherwise consider; or
it is becoming probable that the borrower will enter bankruptcy or other financial reorganisation.
The gross carrying amount of a financial asset is written off (i.e. reduced directly) when the
counterparty is in severe financial difficulty and the group has no realistic expectation of recovery of
the financial asset. Financial assets written off remain subject to enforcement action by the group.
Recoveries, if any, are recognised in profit or loss.
(i) Foreign currency translations and balances
Functional and presentation currency
The financial statements are presented in Australian dollars which is the group’s functional and
presentation currency.
Transactions and balances
Transactions undertaken in foreign currencies are recognised in the group’s functional currency, using
the spot rate at the date of the transaction.
(j) Foreign currency translations and balances
Foreign currency monetary items that are outstanding at the reporting date (other than monetary items
arising under foreign currency contracts where the exchange rate for that monetary item is fixed in the
contract) are restated to the spot rate at the reporting date.
Except for certain foreign currency hedges, all resulting exchange gains or losses are recognised in
profit or loss for the period in which they arise.
26
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(k) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST.
Revenues, expenses and purchased assets are recognised net of the amount of GST, except where
the amount of GST incurred is not recoverable from the taxation authority. 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.
Cash flows are presented in the consolidated statement of cash flows on a gross basis, except for the
GST component of investing and financing activities, which are disclosed as operating cash flows.
(l)
Impairment of non-financial assets
For impairment assessment purposes, assets are generally grouped at the lowest levels for which
there are largely independent cash flows (‘cash generating units’). Accordingly, most assets are tested
for impairment at the cash-generating unit level. Because it does not generate cash flows
independently of other assets or groups of assets, any goodwill recognised by the entity is allocated to
the cash generating unit or units that are expected to benefit from the synergies arising from the
business combination that gave rise to the goodwill.
An impairment loss is recognised where the carrying amount of the asset or cash generating unit
exceeds the asset’s or cash generating unit’s recoverable amount. The recoverable amount of an
asset or cash generating unit is defined as the higher of its fair value less costs to sell and value in
use.
Impairment losses in respect of individual assets are recognised immediately in profit or loss.
Impairment losses in respect of cash generating units are allocated first against the carrying amount of
any goodwill attributed to the cash generating unit with any remaining impairment loss allocated on a
pro rata basis to the other assets comprising the relevant cash generating unit.
(m) Income tax
Current income tax expense or revenue is the tax payable on the current period’s taxable income
based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities.
Deferred tax assets and liabilities are recognised for temporary differences at the applicable tax rates
when the assets are expected to be recovered or liabilities are settled. Deferred tax liabilities are not
recognised if they arise from the initial recognition of goodwill. Deferred income tax is also not
accounted for if it arises from the initial recognition of an asset or liability in a transaction, other than a
business combination, that at the time of the transaction did not affect either accounting profit nor
taxable profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if
it is probable that future taxable amounts will be available to utilise those temporary differences and
losses.
Current and deferred tax balances attributable to amounts recognised directly in equity are also
recognised directly in equity.
(n) Inventories
Inventories are measured at the lower of cost and net realisable value. The cost of manufactured
products includes direct material, direct labour and a proportion of manufacturing overheads based
on normal operating capacity but excluding borrowing costs.
Costs are assigned on a standard cost basis which approximates actual cost. The standard cost
basis is reviewed by management regularly and adjusted to reflect current conditions, where
necessary. Net realisable value is an estimated selling price in the ordinary course of business less
estimated costs of completion and estimated costs necessary to make the sale.
27
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(o) Leases
At the commencement date of a lease (other than leases of 12-months or less and leases of low
value assets), the group recognises a lease asset representing its right to use the underlying asset
and a lease liability representing its obligations to make lease payments.
Lease assets
Lease assets are initially recognised at cost, comprising the amount of the initial measurement of
the lease liability, any lease payments made at or before the commencement date of the lease, less
any lease incentives received, any initial direct costs incurred by the group, and an estimate of costs
to be incurred by the group in dismantling and removing the underlying asset, restoring the site on
which it is located or restoring the underlying asset to the condition required by the terms and
conditions of the lease, unless those costs are incurred to produce inventories.
Subsequent to initial recognition, lease assets are measured at cost (adjusted for any
remeasurement of the associated lease liability), less accumulated depreciation and any
accumulated impairment loss.
Lease assets are depreciated over the shorter of the lease term and the estimated useful life of the
underlying asset, consistent with the estimated consumption of the economic benefits embodied in
the underlying asset.
Lease liabilities
Lease liabilities are initially recognised at the present value of the future lease payments (i.e. the
lease payments that are unpaid at the commencement date of the lease). These lease payments
are discounted using the interest rate implicit in the lease, if that rate can be readily determined, or
otherwise using the group’s incremental borrowing rate.
Subsequent to initial recognition, lease liabilities are measured at the present value of the remaining
lease payments (i.e. the lease payments that are unpaid at the reporting date). Interest expense on
lease liabilities is recognised in profit or loss (presented as a component of finance costs). Lease
liabilities are remeasured to reflect changes to lease terms, changes to lease payments and any
lease modifications not accounted for as separate leases.
Variable lease payments not included in the measurement of lease liabilities are recognised as an
expense when incurred.
Leases of 12-months or less and leases of low value assets
Lease payments made in relation to leases of 12-months or less and leases of low value assets (for
which a lease asset and a lease liability has not been recognised) are recognised as an expense on
a straight-line basis over the lease term.
(p) Other revenue
Interest revenue is recognised using the effective interest method.
Other revenue is recognised when the right to receive income or other distribution has been
established.
(q) Principles of consolidation
The consolidated financial statements are those of the consolidated entity, comprising the financial
statements of the parent entity and of all entities, which the parent entity controls. The parent entity
controls an entity when it is exposed, or has rights, to variable returns from its involvement with the
entity and has the ability to affect those returns through its power over the entity.
The financial statements of subsidiaries are prepared for the same reporting period as the parent
entity, using consistent accounting policies. Adjustments are made to bring into line any dissimilar
accounting policies, which may exist.
28
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
All inter-company balances and transactions, including any unrealised profits or losses have been
eliminated on consolidation. Subsidiaries are consolidated from the date on which control is established
and are derecognised from the date that control ceases.
(r) Non-current assets and disposal groups held for sale
Non-current assets and disposal groups are classified as held for sale if it is highly probable their carrying
amounts will be recovered principally through a sale transaction rather than through continuing use.
Except in some limited circumstances, such as in the case of deferred tax balances and items measured
at fair value on a recurring basis, non-current assets and assets and liabilities comprising disposal groups
classified as held for sale are measured at the lower of their carrying amounts and fair values less costs of
disposal.
An impairment loss is recognised when the carrying amount of a non-current asset or disposal group held
for sale exceeds its fair value less costs of disposal and is recognised immediately in profit or loss. Any
impairment loss on a disposal group is allocated first to any goodwill attributable to the disposal group,
and then to the remaining assets and liabilities on a pro rata basis, except for inventories, deferred tax
assets and assets otherwise measured at fair value on a recurring basis. Gains are recognised in respect
of any subsequent increases in fair value less costs of disposal of non-current assets or disposal groups
held for sale, but only to the extent of any cumulative impairment losses previously recognised.
(s) Property, plant and equipment
Cost and valuation
Property, plant and equipment are stated at historical cost less accumulated depreciation and any
accumulated impairment losses. Repairs and maintenance are recognised in profit or loss as
incurred.
Depreciation
Land is not depreciated. The depreciable amounts of all other property, plant and equipment are
calculated using the straight-line method over their estimated useful lives 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 useful lives for each class of assets are:
–
–
–
Buildings
Plant and equipment
Leased plant and equipment
(t) Research and development expenditure
2023
Up to 40 years
1 to 20 years
5 to 20 years
2022
Up to 40 years
1 to 20 years
5 to 20 years
Expenditure on research activities is recognised as an expense when incurred.
Development costs are capitalised when the group can demonstrate all of the following: the technical
feasibility of completing the asset so that it will be available for use or sale; the intention to complete the
asset and use or sell it; the ability to use or sell the asset; how the asset will generate probable future
economic benefits; the availability of adequate technical, financial and other resources to complete the
development and to use or sell the asset; and the ability to measure reliably the expenditure attributable
to the asset during its development. Capitalised development costs are amortised over their estimated
useful lives commencing from the time the asset is available for use. The amortisation method applied
to capitalised development costs is consistent with the estimated consumption of economic benefits of
the asset. Subsequent to initial recognition, capitalised development costs are measured at cost, less
accumulated amortisation and any accumulated impairment losses.
29
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(u) Revenue from contracts with customers
Sales
The Group’s contracts with customers for the sale of egg products include one performance obligation.
The Group recognises revenue from sale of products at the point in time when control of the asset is
transferred to the customer on delivery of the goods. The normal credit terms are 30 to 60 days.
Variable consideration
Some contracts for the sale of products provide customers with rebates and promotional discounts which
give rise to variable consideration. The variable consideration is estimated at contract inception using the
expected value method based on forecast, timing of settlement and/or volumes and is constrained until it
is highly probable that a significant revenue reversal in the amount of cumulative revenue recognised will
not occur when the associated uncertainty is subsequently resolved.
The amount of revenue reflects the consideration to which the Group expects to be entitled to in exchange
for those goods.
Trade receivables
A receivable represents the Group’s right to an amount of consideration that is unconditional (i.e. only the
passage of time is required before payment of the consideration is due).
Contract assets
A contract asset is the right to consideration in exchange for goods or services transferred to the
customer. If the Group performs by transferring products to a customer before payment is due, a contract
asset is recognised for the right to the earned consideration that is conditional.
Contract liabilities
A contract liability is the obligation to transfer products to customers for which the Group has received
consideration from the customer in advance. If a customer pays consideration before the Group transfers
products to the customer, a contract liability is recognised when the payment is made, or the payment is
due. Contract liabilities are recognised as revenue when the Group provides the product under the
contract.
(v) Provisions
Provisions are recognised when the consolidated entity 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. The amount recognised as a provision is the best estimate of the expenditure
required to settle the present obligation at the end of the reporting period.
(w) Segment reporting
Management has determined the operating segments based on the reports reviewed by the board of
directors (the chief operating decision maker as defined under AASB 8) that are used to make strategic
and operating decisions. The board of directors considers the business primarily from a geographic
perspective. On this basis the Group has identified one reportable segment, Australia. The Group does
not operate in any other geographic segment.
(x) Comparatives
Where necessary the comparative information has been reclassified and repositioned for consistency
with current year disclosures.
(y) Rounding of amounts
The group have applied the relief under ASIC Corporates (Rounding in Financial/Directors’ Reports)
Instrument 2016/191 and accordingly, the amounts in the Financial Reports and in the Directors’
Report have been rounded to the nearest thousand dollars, or in certain cases, to the nearest dollar
(where indicated).
30
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(z) Adoption of new and revised Accounting Standards:
The group has applied all new and revised Australian Accounting Standards that apply to annual
reporting periods beginning on or after 1 July 2022. These standards do not have a material impact
on the Group’s financial results or position.
(aa) Standards and interpretations issued but not yet effective:
The AASB has issued a number of new and amended Accounting Standards and Interpretations
that have mandatory application dates for future periods. The Group has decided not to early adopt
any of these new and amended pronouncements. These pronouncements are not expected to have
a material impact on the entity in the current or future reporting periods or on foreseeable future
transactions.
Note 2: Significant accounting estimates and judgements
Estimates and assumptions based on future events have a significant inherent risk, and where future
events are not as anticipated there could be a material impact on the carrying amounts of the assets
and liabilities discussed below:
(a)
Impairment of non-current assets other than goodwill
All assets are assessed for impairment at each reporting date by evaluating whether indicators of
impairment exist in relation to the continued use of the asset by the Group. Impairment triggers include
declining product or manufacturing performance, technology changes, adverse changes in the
economic or political environment or future product expectations. If an indicator of impairment exists,
the recoverable amount of the asset is determined. Refer to Note 13(b) for further details.
(b)
Income tax
Deferred tax assets and liabilities are based on the assumption that no adverse change will occur in the
income tax legislation and the anticipation that the Group will derive sufficient future assessable income
to enable the benefit to be realised and comply with the conditions of deductibility imposed by the law.
Deferred tax assets are recognised for deductible temporary differences and tax losses to the extent
that management considers that it is probable that future taxable profits will be available to utilise those
temporary differences.
(c)
Fair value measurements
Certain financial assets and liabilities are measured at fair value. Fair values have been determined in
accordance with fair value measurement hierarchy. Refer to Note 3(d): Fair Value Measurements for the
details of the fair value measure key assumptions and inputs.
(d)
Estimation of useful lives of assets
The Group determines the estimated useful lives and related depreciation charges for its property, plant
and equipment. The useful lives could change significantly as a result of technical innovations or some
other event. The depreciation charge will increase where the useful lives are less than previously
estimated lives, and technically obsolete or non-strategic assets that have been abandoned or sold will
be written off or written down.
(e)
Biological assets
The cost of flocks of hens are amortised over the productive life of the flock, which is between 50
and 60 weeks. This is based on the characteristics of the flock and the Group’s historical operating
experience.
31
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(f)
Provision for expected credit losses of trade receivables and contract assets
The Group uses a provision matrix to calculate expected credit losses (ECLs) for trade receivables and
contract assets. The provision rates are based on days past due for groupings of various customer
segments that have similar loss patterns. The provision matrix is initially based on the Group’s historical
observed default rates. The Group will calibrate the matrix to adjust the historical credit loss experience
with forward-looking information. At every reporting date, the historical observed default rates are
updated and changes in the forward-looking estimates are analysed.
The Group’s historical credit loss experience and forecast of economic conditions may also not be
representative of customer’s actual default in the future.
(g)
Rebates and promotional discounts liabilities
Rebates and promotional discounts are either settled monthly on settlement of invoice or accrued at
balance sheet date depending on the exact timing of the customer claim. The Group estimates the
rebate and promotional discount based on the percentage specified in the customer contract and the
timing of settlement and/or volumes sold taking into account previous claims made.
(h)
Inventory provisions
Management's judgement is applied in determining the inventory provisions for obsolescence and net
realisable value, where the estimated selling price of inventory is lower than the cost to sell based on
historical observations and management expectations.
(i)
Share Based Payments:
The Group measures the cost of equity settled transactions with employees by reference to the fair
value of the equity instruments on the date at which they are granted. The value of equity instruments
granted is determined according to the fair value of goods or services received unless that fair value
cannot be estimated reliably, in which case the fair value is determined by reference to the underlying
value of equity instruments granted.
Note 3: Financial instruments risk management objectives and policies
The Group’s activities expose it to a variety of financial risks, including market risk (commodity prices,
foreign currency and interest rate risk), liquidity risk and credit risk.
The Group’s senior management oversees the management of these risks by using various financial
instruments, including derivative financial instruments. It is the Group’s policy that no trading in
derivatives for speculative purposes may be undertaken. The use of financial derivatives is subject to
approval by the Board of Directors.
The Group’s principal financial liabilities, other than derivatives, comprise loans and borrowings,
and trade and other payables. The main purpose of these financial liabilities is to finance the
Group’s operations. The Group’s principal financial assets include trade receivables, and cash
and short-term deposits that derive directly from its operations. The Group is exposed to some
foreign currency risk as the purchase of plant and equipment from time to time is denominated in
foreign currencies.
32
The Group holds the following financial assets and financial liabilities at reporting date:
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Financial assets
Cash and cash equivalents
Receivables
Financial liabilities
Payables
Lease liabilities
Borrowings
(a) Market risk
(i) Commodity price risk
2023
$’000
1,987
8,619
10,606
14,327
18,734
15,814
48,875
2022
$’000
2,150
7,920
10,070
12,560
23,240
11,575
47,375
The Group is affected by the price variability of certain commodities. The Group’s main sales product is
shell eggs which is a commodity that is subject to market conditions. Where possible the Group enters
longer term relationships with key customers that create more certainty around volumes and price. The
Group’s activities also require the ongoing purchase of grain and/or feed stock and is therefore
affected by fluctuations in the price of feed ingredients, primarily wheat and soy. The Group manages
this exposure utilising forward grain and/or feed stock purchase commitments through its key suppliers,
within certain price parameters agreed by the Board of Directors.
(ii) Foreign exchange risk
The majority of the Group’s operations are denominated in Australian dollars, therefore minimising
the impact of foreign currency risk. The Group undertakes some transactions denominated in foreign
currencies; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures
are managed utilising forward foreign exchange contracts, subject to approval by the Board of
Directors.
Forward foreign exchange contracts
It is the policy of the Group to enter into forward foreign exchange contracts to cover specific foreign
currency payments (normally Euro) for future purchases of plant and equipment.
(iii) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in market interest rates. The Group’s exposure to the risk of changes in
market interest rates relates primarily to the Group’s external debt facilities and cash at bank held at
variable rates.
The Group’s exposure to interest rate risks in relation to future cash flows and the weighted average
effective interest rates on classes of financial assets and financial liabilities is shown in the table
below.
33
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Sensitivity
The following sensitivity analysis is assessed on the interest rate risk exposures in existence at
reporting date. At 30 June 2023, if interest rates had moved as illustrated in the table below, with all
other variables held constant, the post-tax profit and equity would have been impacted as follows:
Interest rates – increase by 100 basis points
Interest rates – decrease by 100 basis points
(b) Liquidity risk
Impact on post-tax
profit and equity
2023
$’000
(89)
89
2022
$’000
-
-
Ultimate responsibility for liquidity risk management rests with the Board of Directors, who assess the
Group’s short, medium and long-term funding and liquidity management requirements. The Group
manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing
facilities and by continuously monitoring forecast and actual cash flows. Refer to the Group’s funding
arrangements disclosed in Note 16.
Maturities of financial liabilities
The following tables detail the Group’s remaining contractual maturity for its financial liabilities. The
tables have been prepared based on the undiscounted cash flows of financial liabilities based on the
earliest date on which the Group can be required to pay. The table includes both principal and
estimated interest cash flows. Cash flows for financial liabilities without fixed amount or timing are
based on the conditions existing at reporting date.
2023
Financial liabilities
<6
months
$’000
6-12
months
$’000
1-5 years
$’000
Over 5
years
$’000
Total
$’000
Fixed/
Floating
Trade and other
payables
(14,327)
Long Term Floating
Loan
Long Term Fixed Loan
Working Capital Loan
-
(93)
-
-
-
(97)
-
Lease liability
(1,837)
(1,423)
-
(14,225)
(349)
(1,050)
(5,537)
(16,164)
(1,423)
(21,351)
-
-
-
-
(9,937)
(9,937)
2022
Financial liabilities
<6
months
$’000
6-12
months
$’000
1-5 years
$’000
Over 5
years
$’000
(14,327)
-
(14,225)
Floating 9%
(539) Fixed at 7.5%
(1,050) Floating 6.6%
(18,734)
Fixed at 3%
(48,875)
Total
$’000
Fixed/
Floating
Trade and other
payables
(12,560)
Loans
-
-
-
-
(11,575)
-
-
(12,560)
-
(11,575)
Floating 9%
Lease liability
(2,488)
(2,047)
(7,942)
(10,763)
(23,240)
Fixed at 3%
(15,048)
(2,047)
(19,517)
(10,763)
(47,375)
34
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(c) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations under a
financial instrument or customer contract, resulting in financial loss to the Group. The Group
manages its credit risk by dealing with creditworthy counterparties. The Group’s exposure and the
credit ratings of its counterparties are continuously monitored, and the aggregate value of
transactions concluded is spread amongst approved counterparties.
The Group does not have any significant credit risk exposure to any single counterparty or any group
of counterparties having similar characteristics.
The aging analysis of trade and other receivables is provided in Note 8(b). As the Group undertakes
transactions with a large number of customers and regularly monitors payment in accordance with
credit terms, the financial assets that are neither past due nor impaired, are expected to be received
in accordance with credit terms.
The carrying amount of financial assets recorded in the financial statements, net of any allowance for
impairment, represents the Group’s maximum exposure to credit risk.
(d) Fair value of financial instruments
The only financial assets or financial liabilities carried at fair value are forward foreign currency
contracts from time to time. These instruments are considered to be Level 2 financial instruments as
their measurement is derived from inputs other than quoted prices that are observable for the assets
or liabilities, either directly (as prices) or indirectly (derived from prices).
The fair value of forward foreign currency is obtained from third party valuations derived from
discounted cash flow forecasts of forward exchange rates at the end of the reporting period and
contract exchange rates.
There were no transfers between levels 1, 2 and 3 for recurring fair value measurements during the
financial year.
The carrying amount of other financial assets and financial liabilities recorded in the financial
statements approximate their fair values.
Note 4: Revenue
Disaggregation of revenue
In the following table, revenue is disaggregated by major product.
Type of product1
Shell egg
Egg product
Other
Total revenue from contracts with customers
Profit on sale of Keysborough site2
Other income
Total revenue
Consolidated
2023
$’000
2022
$’000
44,648
35,547
2,586
82,781
-
61
82,842
48,058
24,660
1,322
74,040
2,448
89
76,577
1 The majority of sales (99.9%) are made in Australia. Revenue is recognised at a point in time, upon
satisfaction of the Group’s performance obligation, being delivery of the products to the customer.
35
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
2The sale of Keysborough generated cash inflows of $18.500m less transaction costs of $0.383m. With
the sale subject to a long-term lease of fifteen years with an additional five-year option, the proceeds
from the sale have been accounted for in accordance with AASB 16 Leases. As a result, a significant
amount of the proceeds from sale are offset against the right of use asset for the Keysborough site
instead of being recognised as profit on sale of an asset in the current period. This results in the
recognition of a right of use asset of $1.866m, a lease liability of $14.998m and a gain on sale of $2.448m.
Note 5: Loss from continuing operations
Loss from continuing operations before income tax has been determined after the following specific
expenses:
Consolidated
Cost of goods sold
Changes in inventories of finished goods and work in progress
Raw materials and consumables used
Employee benefits expenses
Salaries and wages
Employee superannuation contributions
Total employee benefits expenses
Depreciation of non-current assets and leased assets
Land and buildings
Plant & equipment
Right of use and leased assets
Total depreciation of non-current assets
Foreign exchange translation loss
Flock amortisation (note 10)
Finance costs – interest expense
Impairment of property, plant and equipment
2023
$’000
307
59,922
60,229
17,163
1,472
18,635
887
1,764
3,738
6,389
3
10,745
2,518
-
2022
$’000
(310)
56,770
56,460
15,251
1,317
16,568
1,058
1,644
4,461
7,163
1
10,058
2,177
4,754
36
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Note 6: Income tax
(a) Components of tax expense:
Deferred tax expense
Income tax expense
(b) Income tax reconciliation
(Loss) / profit before income tax
At the statutory income tax rate of 30% (2022: 30%)
Derecognition of carry forward losses and timing differences
Non-deductible expenses
Tax losses not bought to account
Income tax expense
(c) Movement in deferred tax assets and (liabilities)
Balance at beginning of year
Derecognition of carry forward losses and timing differences
Balance at the end of the year
(d) Deferred tax assets not bought to account
Operating losses at 30%
Deductible temporary differences not recognized
Total deferred tax assets not bought to account
Note 7: Dividends
(a) Dividends proposed and recognised as a liability
Consolidated
2023
$’000
2022
$’000
5,827
5,827
(13,955)
(4,187)
5,827
1,427
2,760
5,827
5,827
(5,827)
-
-
-
-
-
-
-
-
-
-
-
-
8,644
5,985
5,687
6,209
14,629
11,896
Consolidated
2023
$’000
Nil
2022
$’000
Nil
(b) Franking credit balance
Balance of franking account at year end
11,485
11,485
37
Note 8: Receivables
Trade receivables
Allowance for expected credit losses
Other receivables
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Consolidated
2023
$’000
8,133
(22)
8,111
508
8,619
2022
$’000
7,465
(6)
7,459
461
7,920
(a) Terms and conditions
Trade receivables are non-interest bearing and generally on 30-to-60-day terms.
Other receivables are non-interest bearing and have repayment terms between 30 and 60 days.
(b) Allowance for expected credit losses
Movements in the allowance for expected credit losses were:
Opening balance as at 1 July
Increase in allowance for expected credit losses
Trade and other receivables ageing analysis as at 30 June is:
Consolidated
2023
$’000
2022
$’000
6
16
22
6
-
6
Not past due
Past due
Gross
2023
$’000
8,482
159
8,641
Loss
Allowance
2023
$’000
-
22
22
Gross
2022
$’000
7,923
3
7,926
Loss
Allowance
2022
$’000
-
6
6
Due to the short-term nature of these receivables, their carrying value approximates their fair value.
The maximum exposure to credit risk is the fair value of receivables. Collateral is not held as security.
Note 9: Inventories
CURRENT
Raw materials
Finished goods
Total inventories
Consolidated
2023
$’000
3,274
1,271
4,545
2022
$’000
3,366
1,485
4,851
38
Note 10: Biological assets
Consolidated
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Current
Non-current
Total
Flocks
Cost
Less: Accumulated amortisation
Opening written down value
Additions
Amortisation
Disposal
Closing written down value
2023
$’000
9,662
349
10,011
16,318
(6,307)
10,011
6,300
14,560
2022
$’000
5,897
403
6,300
14,409
(8,109)
6,300
8,017
8,341
(10,745)
(10,058)
(104)
10,011
-
6,300
The number of birds held by the Group as at 30 June 2023 was 1,163,255 (2022: 1,223,354).
The average output per bird is approximately 5.5 eggs per week during their productive period.
Note 11: Other current assets
Prepayments and deposits
Note 12: Assets held for sale
Assets held for sale
Assets held for sale
Consolidated
2023
$’000
757
2022
$’000
1,919
Consolidated
2023
$’000
2022
$’000
1,822
-
The Group has entered into a contract to sell the non-arable land portion of one of its farms. The
settlement process is expected to complete in either the 1st or 2nd quarter of FY24.
39
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Note 13: Property, plant and equipment
2023
Cost
Accumulated depreciation
and impairment
Land and
buildings
Plant and
equipment
$’000
24,073
(8,873)
$’000
46,982
(40,914)
Net book value
15,200
6,068
Opening net book value as at
1 July 2022
17,900
7,418
Additions
Impairment losses
Disposal
Transfers
Transfer to assets held for
sale
Depreciation
Net book value as at 30
June 2023
2022
Cost
Accumulated depreciation
and impairment
-
-
(23)
32
(1,822)
(887)
15,200
-
-
(229)
643
-
(1,764)
6,068
Land and
buildings
Plant and
equipment
$’000
25,893
(7,993)
$’000
47,796
(40,378)
Net book value
17,900
7,418
Opening net book value as at
1 July 2021
18,632
12,011
Additions
Impairment losses
Disposal
Transfers
Depreciation
Net book value as at 30
June 2022
4
-
-
322
(1,058)
17,900
521
(4,754)
-
1,284
(1,644)
7,418
Capital
works in
progress
$’000
570
-
570
195
1,050
-
-
(675)
-
-
570
Capital
works in
progress
$’000
195
-
195
984
817
-
-
(1,606)
-
195
Total
$’000
71,625
(49,787)
21,838
25,513
1,050
-
(252)
-
(1,822)
(2,651)
21,838
Total
$’000
73,884
(48,371)
25,513
31,627
1,342
(4,754)
-
-
(2,702)
25,513
40
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(a)
Assets pledged as security
Included in the balances of freehold land and buildings and plant and equipment are assets over which
first mortgages have been granted as security over loans (see note 16). The terms of the first
mortgage preclude the assets from being sold or being used as security for further mortgages without
the permission of the first mortgage holder. The mortgage also requires buildings that form part of the
security to be fully insured at all times.
Impairment testing of non-current assets
(b)
The Group performed an impairment test as at June 2023. The recoverable amount of the Group’s
property, plant and equipment was determined on a value-in-use basis, using cash flow forecasts
covering a 5-year period and perpetual cash flow projections beyond the 5-year budget period using
a growth rate of 3.0% (2022: 3.0%) that approximates the long-term average growth rate for the
sector, and a post-tax discount rate of 12% (2022: 10%). Based on this determination, management
concluded that the recoverable amount of the Group’s property, plant and equipment was greater
than its carrying amount at 30 June 2023 and that the Group’s non-current assets were not impaired.
Note 14: Lease assets and liabilities
Lease assets
2023
Cost
Accumulated depreciation
Net book value
Opening net book value as at 1 July 2022
Depreciation
Disposal
Net book value as at 30 June 2023
Lease assets
2022
Cost
Accumulated depreciation
Net book value
Opening net book value as at 1 July 2021
Recognition of leased assets - additions
Depreciation
Net book value as at 30 June 2022
Plant and
equipment
$’000
Total
$’000
1,381
23,061
(1,132)
(16,725)
249
6,336
451
(185)
(17)
249
10,091
(3,738)
(17)
6,336
Plant and
equipment
$’000
1,408
(957)
451
763
-
(312)
451
Total
$’000
23,088
(12,997)
10,091
10,966
3,586
(4,461)
10,091
Land and
buildings
$’000
21,680
(15,593)
6,087
9,640
(3,553)
-
6,087
Land and
buildings
$’000
21,680
(12,040)
9,640
10,203
3,586
(4,149)
9,640
41
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Lease liabilities
Lease liabilities
Current lease liabilities
Non-current lease liabilities
Total carrying amount of lease liabilities
Lease expenses and cashflows
Depreciation expense on lease assets
Interest expense on lease liabilities
Repayment of lease liability
Total cash outflow relating to leases
Note 15: Payables
Trade creditors
Other payables and accruals
(i) Terms and conditions
Our standard terms are 30 days from the end of month.
2023
$’000
3,305
15,429
18,734
3,738
616
4,506
5,122
2022
$’000
4,535
18,705
23,240
4,461
746
4,899
5,645
Consolidated
2023
$’000
11,349
2,978
2022
$’000
7,735
4,825
14,327
12,560
42
Note 16: Borrowings
Current
Secured
Borrowings:
Long term loan (unsecured)1
Non-current
Secured
Borrowings:
Long term loan (secured)2
Working capital loan3
Long term loan (unsecured)1
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Consolidated
2023
$’000
2022
$’000
190
190
-
-
14,225
11,575
1,050
349
-
-
15,624
11,575
1 The facility is unsecured. The maturity date of the facility is 28th February 2026.
2 The facility is secured by a fixed charge over selected property and company assets. The maturity date
of the facility is 31 August 2024.
3 The facility is secured over the Group’s receivables. The facility was renewed in June 23. The maturity
date of the facility is 31 August 2024.
At the reporting date, the consolidated entity’s financing are as follows.
Consolidated
2023
$’000
14,342
14,225
117
2,000
1,050
950
539
539
-
2022
$’000
14,342
11,575
2,767
-
-
-
-
-
-
(i) Long Term Loan (secured)
Facilities available
Facilities used
Facilities unused
(ii) Working Capital Loan
Facilities available
Facilities used
Facilities unused
(iii) Long Term Loan (unsecured)
Facilities available
Facilities used
Facilities unused
43
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Note 17: Provisions
Current
Employee benefits
Annual and other leave entitlements
Long service leave
Non-current
Employee benefits
Long service leave benefits
Total employee benefits provisions
Note 18: Contributed Equity
Issued and paid-up capital
143,857,856 (2022: 55,180,175) Ordinary shares fully paid
Each share is entitled to 1 vote per share.
Reconciliation:
Consolidated
2023
$’000
997
877
1,874
2022
$’000
1,018
811
1,829
115
177
1,989
2,006
Consolidated
2023
$’000
34,307
34,307
2022
$’000
29,578
29,578
Reconciliation of the number of ordinary shares outstanding at the beginning and end of the year:
Number of
ordinary
shares
Share capital
$’000
55,180,175
-
55,180,175
88,677,681
-
143,857,856
29,578
-
29,578
4,877
(148)
34,307
Balance at 1 July 2021
Ordinary shares issued during the year
Balance at 30 June 2022
Ordinary shares issued during the year
Share issue costs (net of tax)
Balance at 30 June 2023
44
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(a)
NREO and Placement:
During the year, the company raised $4.877m of additional capital (before costs) through a non
renounceable entitlement offer of new shares to eligible shareholders (NREO) and Placement as
described below:
-
i.
ii.
NREO: On 25th January 2023, the company raised $1.341m through a 7:12 pro rata NREO,
with a further $0.036m approved by shareholders at the Extraordinary General Meeting (EGM)
held 23 February 2023. 25,041,317 new shares were issued at a price of 5.5 cents per share
pursuant to the NREO.
Placement: At the EGM held 23 February shareholders also approved the Placement to
sophisticated and professional investors to raise $3.500m (before costs). 63,636,364 new
shares were issued at a price of 5.5 cents per share pursuant to the Placement.
Before the issue of new shares, the Company’s largest shareholder was West Coast Eggs Pty Ltd,
holding 27,486,302 or 49.81% of the shares in the Company. West Coast Eggs Pty Ltd continues to be
the largest shareholder of the Company subsequent to the issue of the new shares, holding 43,519,979
or 30.25% of the shares in the Company.
(b)
Capital management
The Board reviews the capital structure on an ongoing basis. The Group’s objective is to maintain an
optimal capital structure which seeks to reduce the cost of capital and safeguard the Group’s ability to
continue as a going concern, so that they can continue to provide returns for shareholders and
benefits for other stakeholders. In order to maintain or adjust the capital structure the Group may
adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new
shares.
(c)
Dividends
During the year ended 30 June 2023 no dividends were paid, declared or recommended (2022: Nil).
Note 19 (Loss)/Earnings per share
The following reflects the income and share data used in calculations of basic and diluted
(loss)/earnings per share computations:
Net (loss) / profit from continuing operations
Weighted average
Weighted average number of shares used in
calculating basic (loss)/earnings per share
Weighted average number of shares used to
calculate diluted (loss)/earnings per share1
Consolidated
2023
$’000
2022
$’000
(9,112)
(19,782)
2023
No. of shares
2022
No. of shares
92,129,209
55,180,175
92,129,209
55,180,175
1 Share Options and performance rights issued to Mr. Darren Lurie are not dilutive because their
conversion to ordinary shares would increase loss per share.
45
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Note 20: Share Based Payments
As described in the Director’s Report, the company has granted share options and performance rights
to Mr. Darren Lurie (Managing Director). The expense recognised in relation to these share-based
payment transactions was recognised within other expenses within profit or loss were as follows:
Total expense recognised
Note 21: Cash Flow Information
Consolidated
2023
$’000
2022
$’000
71
-
Consolidated
2023
$’000
2022
$’000
(a) Reconciliation of cash flow from operations with profit
after tax:
(Loss)/profit from ordinary activities after tax
(9,112)
(19,782)
Non-cash items
Depreciation
Impairment of property, plant and equipment
Flock amortisation
Net loss/(profit) on disposal of property, plant and equipment and
leased assets
Non-cash movement on loan
Share options expense
Provision for doubtful debts
Non-cash interest
Non-cash movement on property, plant and equipment and
leases
Changes in operating assets and liabilities net of effects
from acquisition of businesses:
(Increase) / decrease in trade and other receivables
(Increase) / decrease in inventory
(Increase) / decrease in biological assets
(Increase) / decrease in deferred tax asset
(Increase) / decrease in other assets
Increase / (decrease) in trade and other creditors
Increase / (decrease) in employee entitlements
6,389
-
10,745
46
600
71
16
99
7,163
4,754
10,058
(2,439)
488
-
-
-
(304)
(23)
(715)
306
(14,456)
-
1,162
1,767
(17)
(1,815)
(310)
(8,341)
5,827
(1,141)
1,950
(123)
Net cash flow from operating activities
(3,403)
(3,734)
46
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
(b) Reconciliation of cash and cash equivalents for the
purposes of the Consolidated Statement of Cash Flows
Cash at bank
1,987
1,987
2,150
2,150
(c) Reconciliation of liabilities arising from financing activities
As at
1 July
Financing
cash flows
$’000
11,575
23,240
$’000
3,540
(4,506)
34,815
(966)
Non-Cash
Changes
Other
$’000
699
-
699
As at
30 June
$’000
15,814
18,734
34,548
18,709
11,421
(7,277)
(4,899)
143
16,718
11,575
23,240
30,130
(12,176)
16,861
34,815
2023
Bank loans
Lease liabilities
Total liabilities from
financing activities
2022
Bank loans
Lease liabilities
Total liabilities from
financing activities
Note 22: Commitments
Farm cost commitments
Farm commitments relate to commitments for flock replenishment and other farm operating expenditure
commitments:
Farm cost commitments
Consolidated
2023
$’000
2022
$’000
1,849
4,163
47
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Note 23: Controlled Entities
The consolidated financial statements include the financial statements of Farm Pride Foods Limited and
its controlled entities listed below:
List of companies in the group
Parent entity:
Farm Pride Foods Limited
Country of
incorporation
Percentage owned
2023
2022
Australia
100%
100%
Controlled entities of Farm Pride Foods Limited
Big Country Products Pty Ltd
Farm Pride Property Pty Ltd
Mooroopna Farm Trading Pty Ltd
Farm Pride North Pty Ltd
Carton Packaging Pty Ltd
Australia
Australia
Australia
Australia
Australia
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Note 24: Related party disclosures
(a) Parent entity and equity interests in related parties
The parent entity of the Group is Farm Pride Foods Limited, a listed public company, incorporated in
Australia.
Details of the percentage of ordinary share held in subsidiaries are disclosed in Note 23.
(b) Ultimate parent entity
Until February 2023, the ultimate parent entity of the Group was AAA Egg Company Pty Limited,
(AAA) private company, incorporated in Australia. AAA ceased to be the ultimate parent entity of the
Group subsequent to the NREO and Placement issue as describe in Note 18.
(c) Key management personnel
Disclosures relating to key management personnel are set out in the Directors’ report.
(d) Key management personnel compensation
The aggregate compensation of the key management personnel of the Group is set out below:
Short-term employee benefits
Long term employee benefits
Post-employment benefits
Consolidated
2023
$’000
907
71
77
1,055
2022
$’000
655
-
60
715
Detailed remuneration disclosures are provided in the Remuneration Report on page 12 to 14.
48
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Note 24: Related party disclosures (continued)
(e) Transactions with directors and director-related entities
The value of transactions (inclusive of GST) and amounts receivable / (payable) between Directors and
their related entities and Farm Pride Foods Limited and its controlled entities.
Director related entities
Transaction
Revenue
Expenditure
Days Eggs Pty Ltd 1
(P. Bell)
Pure Foods Eggs Pty Ltd 1
(P. Bell)
West Coast Eggs Pty Ltd 1
(P. Bell / M. Ward)
AAA Egg Company Pty Ltd 1
(P. Bell / M. Ward)
Oakmeadow Pty Ltd 1
(M. Ward)
Morago Holdings Pty Ltd1
(P. Bell)
Siamje 2
(D. Lurie)
Egg supply /
Purchases
Egg sales
Egg sales /
Purchases
Egg
Purchases/
Loan Interest
Loan Interest
Loan Interest
Consulting
2023
$’000
2022
$’000
8
-
-
6
2023
$’000
223
-
2022
$’000
Balance
Receivable /
(Payable)
2023
$’000
2022
$’000
-
-
(52)
-
-
-
141
803
331
138
(46)
62
-
-
-
-
-
-
-
-
12
6
17
84
-
-
-
-
-
-
-
-
-
-
-
-
1Peter Bell and Malcolm Ward through their related entities provide birds, eggs and egg products to and acquire eggs, egg product and
packaging from Farm Pride Foods Limited and its controlled entities. Peter Bell and Malcolm Ward through their related entities
also provided unsecured interest-bearing loans during the year. Director’s administrative expenses are reimbursed at cost. These
transactions are on normal trading terms and conditions. Peter Bell resigned as director in September 2022.
2Darren Lurie through his related entity had provided consulting services to the business before his appointment as director in
February 2023.
Transactions in the above table represent related party transactions for the full financial year from July ‘22 – June ’23 and
comparatives for July ’21 - June ‘22.
49
Farm Pride Foods Limited and Controlled Entities
Notes to the financial statements
Note 25: Parent entity information
Information relating to Farm Pride Foods Limited:
Summarised statement of financial position
Current assets
Total assets
Current liabilities
Total liabilities
Total equity of the Parent comprises of the following:
Share capital
Retained (losses)
Share option reserve
Total shareholder’s equity
Summarised statement of comprehensive income
(Loss) of the parent entity
Total comprehensive (loss) of the parent entity
2023
$’000
27,392
55,914
18,991
50,113
34,307
(28,577)
71
5,801
(9,083)
(9,083)
2022
$’000
22,738
58,744
18,288
48,660
29,578
(19,494)
-
10,084
(19,591)
(19,591)
Farm Pride Foods Limited as parent has provided security over the loans of its subsidiaries by a
fixed and floating charge (see note 16).
Note 26: Auditor’s remuneration
Audit and other assurance services
Audit and review of the financial report of the entity
and any other entity in the consolidated entity
Other services
Taxation services
Note 27: Subsequent Events:
Consolidated Entity
2023
$
2022
$
222,587
187,690
40,109
262,696
21,940
209,630
There are no matters or circumstances which have arisen since 30th June 2023 that have
significantly affected or may significantly affect the operations of the Group, the results of those
operations or the state of affairs of the group in future financial periods.
50
Farm Pride Foods Limited and Controlled Entities
Directors’ Declaration
Directors’ Declaration
The Directors declare that the financial statements and notes set out on pages 23 to 50 in
accordance with the Corporations Act 2001:
(a) Comply with Australian Accounting Standards and the Corporations Regulation 2001,
and other mandatory professional reporting requirements;
(b) As stated in Note 1(a) the consolidated financial statements also comply with
International Financial Reporting Standards; and
(c) Give a true and fair view of the financial position of the Group as at 30 June 2023 and
of its performance for the year ended on that date.
In the Directors’ opinion there are reasonable grounds to believe that Farm Pride Foods Limited
will be able to pay its debts as and when they become due and payable.
This declaration has been made after receiving the declarations required to be made by the
Chief Executive Officer and Chief Financial Officer to the Directors in accordance with sections
295A of the Corporations Act 2001 for the financial year ending 30 June 2023.
This declaration is made in accordance with a resolution of the Directors.
Director
30 August 2023
Melbourne
51
FARM PRIDE FOODS LIMITED
ABN 42 080 590 030
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
FARM PRIDE FOODS LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Farm Pride Foods Limited “the Company” and its controlled
entities “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, the consolidated
statement of changes in equity and the consolidated statement of cash flows for the year then ended,
and 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)
(b)
giving a true and fair view of the Group’s financial position as at 30 June 2023 and of its
financial performance for the year then ended; and
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 confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Material Uncertainty Related to Going Concern
Without modifying our opinion expressed above, attention is drawn to the matters set out in Note 1(b)
– Going Concern in the financial report.
The conditions, as set forth in Note 1(b), indicate the existence of a material uncertainty that may cast
significant doubt about the Group’s ability to continue as a going concern and therefore, the Group
may be unable to realise its assets and discharge its liabilities in the normal course of business.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
pitcher.com.au
FARM PRIDE FOODS LIMITED
ABN 42 080 590 030
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
FARM PRIDE FOODS LIMITED
Key Audit Matter
How our audit addressed the key audit matter
Valuation of flock assets
Valuation of flock assets - $10,011,000
Refer to Note 10: Biological Assets
The Group has $10 million ($6.3 million as at
30 June 2022) of biological assets, “the flock
assets”.
The flock assets should be valued at market
value consistent with AASB 141 Agricultural
assets, however, the lack of an active or liquid
market for flock assets means the flock assets
are measured at cost less accumulated
amortisation and impairment losses. The
amortisation rate is based on the estimated life
of an individual flocks within the flock assets,
and consequently the valuation of the flock
assets as a whole is subject to judgement.
We have focused on this balance given it is
based on significant estimates involving
subjective judgements and uncertainties over
the estimated flock assets life due to the
impact of factors such as disease and
productive capacity of the individual flocks.
Our testing of the flock assets valuation focused
on assessing the appropriateness of
management’s judgements when determining the
flock assets’ estimated life.
Our procedures included, amongst others:
• Obtained client schedule for total flock
assets as at 30 June 2023 and agreed to
the general ledger;
• Assessed the underlying mathematical
accuracy of the client schedule by
performing a recalculation of the written
down value of the flock assets as at 30
June 2023 based on the total capitalised
cost, age and production life of each flock
asset as at 30 June 2023;
• Tested the appropriateness of costs
capitalised to flock assets by verifying a
sample of costs back to supporting
invoices/documentation;
• Held discussions with management and
analysed the key assumptions used to
determine productive life for each flock
asset as at 30 June 2023.
• Assessed the adequacy of the
presentation and disclosure of the flock
assets in the financial report as at 30
June 2023.
• Obtained an understanding of the design
and implementation of the controls over
the valuation of flock assets.
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
pitcher.com.au
FARM PRIDE FOODS LIMITED
ABN 42 080 590 030
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
FARM PRIDE FOODS LIMITED
Valuation of Property, plant and equipment
Valuation of property, plant and equipment -
$21,838,000. Refer to Note 13: Property, plant
and equipment
Our testing of property, plant and equipment
valuation focused on assessing the
appropriateness of management’s judgements in
relation to its determination of cash-generating
units and the associated discounted cash flow.
The Group has $21.8 million ($25.5 million as
at 30 June 2022) of property, plant and
equipment, which represents approximately
39% of total assets.
Australian Accounting Standards require the
Group to assess, at the end of each reporting
period, whether there is any indication of
impairment to assets.
No impairments have been recorded.
We have focused on this balance due to the
significance of the balance and the
determination that property, plant and
equipment is a single cash-generating unit.
The assumptions and methodologies used in
the discounted cash-flow for the impairment
assessment are complex judgements made by
management such as forecasting revenue
growth rate, terminal growth rate and discount
rate.
Our procedures included, amongst others:
• Evaluated the assumptions and
methodologies utilised in the discounted
cash flow prepared by management,
including determination of discount rate,
revenue growth rate, terminal growth rate
and other key assumptions;
• Evaluated the determination of cash-
generating units;
• Assessed the reasonableness of the
discounted cash flow forecast in
comparison to historical actuals and the
forthcoming years Board approved
detailed budget;
• Tested the mathematical accuracy of the
discounted cash flow model;
• Assessed the impact of sensitivities to
sales, cost of sales, gross margin and
discount rate.
• Assessed the adequacy of the
presentation and disclosure of property,
plant and equipment in the financial
report as at 30 June 2023.
• Obtained an understanding of the design
and implementation of the controls over
the valuation of Property, plant and
equipment.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2023, 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.
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.
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
pitcher.com.au
FARM PRIDE FOODS LIMITED
ABN 42 080 590 030
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
FARM PRIDE FOODS LIMITED
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.
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 ability of the Group to
continue as a going concern, disclosing, as applicable, matters related 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
judgement 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.
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
pitcher.com.au
FARM PRIDE FOODS LIMITED
ABN 42 080 590 030
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
FARM PRIDE FOODS LIMITED
• 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 with the directors, we determine those matters that were of most
significance in the audit of the financial report of the current period 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 Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 8 to 16 of the directors’ report for the year
ended 30 June 2023. In our opinion, the Remuneration Report of Farm Pride Foods Limited and
controlled entities, 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.
STEPHEN SCHONBERG
Partner
Date: 30 August 2023
PITCHER PARTNERS
Melbourne
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
pitcher.com.au
Farm Pride Foods Limited and Controlled Entities
ASX Additional Information
ASX Additional Information
Additional information required by the Australian Stock Exchange Ltd and not shown elsewhere in
this report is as follows. The information is current as at 31 July 2023.
(a)
Distribution of equity security
The number of shareholders, by size of holding, in each class of share are:
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 +
The number of shareholders holding less than a marketable parcel of
shares are:
(b)
Twenty largest shareholders
The names of the twenty largest holders of quoted shares are:
Dr Philip James Currie + Mrs. Anne Jennifer Currie
Bait of Brets Pty Ltd
LDL Custodians Pty Ltd
Oakmeadow Pty Ltd
Jadig Superannuation Pty Ltd
Mr Gavin Bruce De Lacy
Normpat Pty Ltd
Markcamp No 2 Pty Ltd
HSBC Custody Nominees (Australia) Ltd – A/C 2
David Ricardo Asset Management Pty Ltd
1 West Coast Eggs Pty Ltd
2
3
4
5
6
7
8
9
10
11
12 Glenmon No2 Pty Ltd
13 Mr Clinton James Quay
14 Merrill Lynch (Australia) Nominees Pty Limited
15
16 Mr Genaro Paul Auriemma Mrs Dilaila Auriemma
17
Dr Walid Mohammed Abdel-Maksoud Aly
18 Gobblers Inc Pty Ltd
19
Vivre Investments Pty Ltd
20 Mr Raymond John Chamberlain
Fusion Electrics (Aust) P/L
57
No. of
shareholders
No. of
shares
368
644
242
284
66
212,794
1,777,789
1,785,509
7,938,879
132,142,885
895
1,427,117
Listed ordinary
shares held
Percentage of
ordinary
shares
43,519,979
21,918,182
21,818,182
14,545,454
3,772,075
3,636,364
2,214,748
2,064,250
2,009,468
1,857,193
1,385,415
1,003,057
937,500
604,099
475,000
400,000
393,002
391,144
375,000
350,000
123,670,112
30.25
15.24
15.17
10.11
2.62
2.53
1.54
1.43
1.40
1.29
0.96
0.70
0.65
0.42
0.33
0.28
0.27
0.27
0.26
0.24
85.96
Farm Pride Foods Limited and Controlled Entities
ASX Additional Information
ASX Additional Information (continued)
(c)
Substantial shareholders
The names of substantial shareholders listed in the Company’s register.
West Coast Eggs Pty Ltd
No. of shares
held
43,519,979
Percentage of
ordinary
shares
30.25
Dr Philip James Currie + Mrs Anne Jennifer Currie
21,918,182
Bait of Brets Pty Ltd
LDL Custodians Pty Ltd
(d)
Voting rights
21,818,182
14,545,454
15.24
15.17
10.11
The voting rights are set out in Article Number 10 of the Company’s Articles of Association. In
summary, voting by or on behalf of members at a meeting shall be by show of hands or upon poll
exercised by one vote for each fully paid ordinary share held or proportionate to the amount paid
on each partly paid ordinary share held.
(e)
Unquoted securities
Nil share options are on issue (2022: Nil).
(f)
Stock Exchange listing
Quotation has been granted for all the ordinary shares of the Company on all members Exchanges
of the Australian Stock Exchange Limited.
Publicly accessible information
For information on corporate governance policies adopted by Farm Pride Foods Ltd refer to our
website:
www.farmpride.com.au
58
Farm Pride Foods Ltd.
ABN: 42 080 590 030
551 Chandler Road
Keysborough
Victoria 3173 Australia
Tel: 1300 693 347
farmpride.com.au