D E VE LO P IN G BE T T E R L I F E ST Y LE S S I N C E 1 9 9 5
2024
ANNUAL REPORT
2024 Finbar Group Limited Annual Report
1
2024 Finbar Group Limited Annual Report
Contents
3
Chairman’s
Report
5
Managing
Director’s
Report
7
FY24
Highlights
9
Key Financial
Metrics
14
Project
History
15
Finbar
Milestones
17
Civic Heart
25
Our Finbar
27
Modern
Amenities
29
ESG at Finbar
30
Completed
Projects
34
Projects Under
Construction
38
New to Market
40
Future
Projects
44
Investment
Properties
46
Financial
Report
2
Chairman’s
Report
JOHN CHAN
“
”
Now, with the completion of Civic Heart
and additional completions due shortly,
we are in a position to begin returning
these earnings to our loyal shareholders
who have demonstrated patience and
trust in our strategy.
Dear Shareholders,
I am pleased to present Finbar Group’s
Annual Report for the 2024 financial year.
This year has been marked by significant
achievements and a strong financial
result for our company.
Finbar has reported a total
comprehensive income of $16.4 million
for the year ended June 30, 2024.
This result represents a substantial
improvement from the previous year’s
figure of just under $3 million, especially
considering the challenging market
conditions we have faced. Our flagship
project, Civic Heart, has been the most
significant contributor to this year’s
results.
I am delighted to announce that the
Board has resolved to declare a dividend
of $0.08 per share, fully franked. This
dividend recognises the absence of
distributions over the past couple of
years as we retained capital for our major
projects. Now, with the completion of
Civic Heart and additional completions
due shortly, we are in a position to begin
returning these earnings to our loyal
shareholders who have demonstrated
patience and trust in our strategy.
The Civic Heart
development, which has
spanned a decade from
planning to completion
stands as Perth’s tallest
building outside the CBD.
We are immensely proud of this
achievement, particularly given the tough
conditions faced by our industry in recent
years. In the final days of the financial
year, we settled 194 lots at Civic Heart,
with a value of $212 million.
I extend my thanks and acknowledge the
commitment of our primary contractor
- Hanssen in concluding the Civic Heart
construction through an incredibly
challenging construction environment.
The past few years have presented
significant challenges for the property
development industry, with rapidly rising
construction costs, labour shortages,
and supply chain disruptions. Despite
these headwinds, we have successfully
navigated this period, thanks in large part
to our long-standing partnerships and the
dedication of our team.
2024 Finbar Group Limited Annual Report
3
I would like to extend my
sincere thanks to our joint
venture partners for their
continuing commitments
to our success. These
enduring relationships
have been crucial in
enabling us to undertake
large-scale projects like
Civic Heart, providing
the capital and support
necessary for such
ambitious developments.
Looking ahead, we see positive signs
in the Perth property market. The
continued lift in property values is
helping to offset the COVID related
increased construction costs, although
we still need to see further price
growth to improve project feasibility.
With only 2,016 houses and 914
apartments currently available for sale
across Perth, we anticipate ongoing
strong demand for our products.
In closing, I would like to acknowledge
our executive team and all Finbar staff
for their hard work and commitment
over the past year. Their efforts,
particularly on long-term projects
like Civic Heart, involve significant
emotional investment and dedication,
which is evident in the quality of our
developments.
I would also like to announce that our
long-serving Chief Financial Officer and
Company Secretary, Ed Bank, will be
retiring at the end of December this
year. On behalf of the Board, I extend
our deepest gratitude for his invaluable
contribution over the past 19 years.
Ed’s commitment to our Company over
a long period of time has been most
valued.
Thank you to all our shareholders for
your ongoing support and patience.
We look forward to rewarding your
faith in Finbar in the coming year as
we continue to deliver high-quality
residential developments and see the
significant return of additional capital
from the imminent completion of major
projects.
John Chan
Chairman
Finbar has reported a total comprehensive income
of $16.4 million for the year ended June 30, 2024.
2024 Finbar Group Limited Annual Report
4
Managing
Director’s
Report
“
The completion of Civic Heart has been
the defining achievement of this financial
year. As Western Australia’s largest
residential project and Perth’s tallest
building outside the CBD, it represents
a decade of planning, perseverance,
challenges, and execution. ”
DARREN PATEMAN
Dear Shareholders,
The 2024 financial year has been a
period of significant achievement for
Finbar, marked by the completion of
our landmark Civic Heart project and
a strong financial performance in the
face of ongoing industry challenges. I
am pleased to present to you a detailed
overview of our performance and outlook.
Financial performance
I am delighted to report a total
comprehensive income of $16.4 million
for the year ended June 30, 2024. This
result, a substantial improvement from
the previous year’s figure of just under $3
million, reflects the successful delivery
of our key project and the resilience of
our business model during challenging
market conditions.
Our strong financial position is further
evidenced by our cash balance of $220
million at year-end. While this figure
is noteworthy, it should be considered
alongside the $173.5 million in loans
and borrowings on our balance sheet
on June 30, directly related to Civic
Heart’s construction facility which was
subsequently repaid on July 4, ensuring
all remaining unsettled stock at Civic
Heart is now debt free.
Project delivery
The completion of Civic Heart has been
the defining achievement of this financial
year. As Western Australia’s largest
residential project and Perth’s tallest
building outside the CBD, it represents
a decade of planning, perseverance,
challenges, and execution.
The settlement of 194 lots valued at $212
million in the final days of the financial
year was a satisfying conclusion to this
monumental project. Civic Heart, which
has achieved a total of $355.5 million
in sales to date with $266 million now
settled, stands as a testament to Finbar’s
capability to deliver large-scale, complex
developments even in challenging market
conditions. Just 55 of the total 334 lots
are yet to sell at Civic Heart.
We are now in the final stages of
completing The Point in Rivervale
and Aurora in Applecross, with both
projects expected to reach completion
in September and October this year,
respectively. We have secured $81.5
million in sales at The Point, equating to
82% of the stock on offer. At Aurora, we
have sold 70 of 121 lots, totalling $67.65
million.
While The Point has been more exposed
to the construction cost increases of
recent years, potentially impacting its
profitability, Aurora’s premium location is
expected to deliver more robust margins.
These projects will add to our portfolio of
completed stock, providing ongoing sales
opportunities in the coming year.
We have commenced construction on
Garden Towers in East Perth, with 65%
of the 344 lots having sold. We have
also seen strong sales for our recently
launched Bel-Air project in Rivervale,
with 57% of its apartments sold since
marketing began in May 2024.
We anticipate commencing construction
on Bel-Air before the end of the calendar
year. These new projects demonstrate our
confidence in the market and our ability to
continue delivering quality developments
that meet buyer expectations despite the
higher construction price environment in
which we are now operating.
2024 Finbar Group Limited Annual Report
5
Market conditions and outlook
The Perth property market continues
to present both challenges and
opportunities. While we have seen
some stabilisation in construction costs,
labour costs remain elevated. The long
anticipated and now continual increase
in values of our product is helping the
Company adapt to this new construction
cost environment. Our experienced
team is focused on innovative design
to meet evolving market needs, and
efficient construction methods to
mitigate these cost pressures.
The chronic undersupply of housing
in Perth, with only 2,016 houses and
914 apartments currently available for
sale, underpins the ongoing demand for
our products. We believe the medium
and high-density sector will play a
crucial role in meeting the state’s
housing needs, with WA on track to fall
more than 15,000 homes short of its
National Housing Accord target. This
scenario positions Finbar favourably to
contribute significantly to addressing
this shortfall and should also support
further pricing growth whilst this
demand remains unsatisfied.
Our project pipeline remains strong,
with several approved developments
ready to launch when market conditions
align. This positions us well to meet
future demand without the immediate
need for new site acquisitions.
However, we remain alert to potential
opportunities that may arise in the
market, maintaining our disciplined
approach to land acquisition.
Strategic focus
As we move forward, our focus remains
on efficient project delivery, prudent
capital management, and an agile
structure to help us respond rapidly
to changing market demands and
conditions. We continue to advocate for
policy changes that would support the
property sector, including the extension
of stamp duty concessions to completed
stock and a review of the foreign buyer
surcharge. These measures could
stimulate further activity in the market
and support the delivery of much-
needed housing stock.
Our Finbar to Rent and Finbar Sales
divisions continue to grow, contributing
$414,000 and $436,000 respectively
to our after-tax profit. These divisions
provide valuable diversification to our
income streams, enable us to stay
connected and engaged with our valued
clients after delivery, and enhance our
understanding of the rental market,
informing our development decisions.
The performance of our investment
property in Karratha, Pelago has been
particularly noteworthy, contributing
$2.34 million to our profit before tax,
excluding a lift in book value of the
underlying asset.
Acknowledgements
I would like to extend my sincere thanks
to our financiers CBA, NAB, Westpac
for their continued support and
confidence in our business. Our design
and construction partners, SS Chang
Architects and Hanssen, have been
instrumental in our success, and we are
grateful for their ongoing collaboration.
To our Finbar team, your dedication
and hard work over multiple years,
especially on long-term projects like
Civic Heart, is deeply appreciated. The
emotional investment you bring to each
project is evident in the quality of our
developments and the satisfaction of
our customers.
Lastly, I join our chairman in extending
our gratitude to Ed Bank, our retiring
CFO and Company Secretary, for his 19
years of outstanding service to Finbar.
Ed’s contribution to the company’s
growth and financial management has
been invaluable, and we wish him all
the best in his well-earned retirement
from corporate life.
As we look to the future, we are
well-positioned to capitalise on the
opportunities in the Perth property
market. Our strong balance sheet,
experienced team, and pipeline
of quality projects provide a solid
foundation for continued success.
We thank our shareholders for their
continued support and look forward
to delivering strong results and the
distribution of earnings to you in the
coming year.
Darren Pateman
Managing Director
2024 Finbar Group Limited Annual Report
6
FY24
Highlights
*This is a non-statutory (non-IFRS) measure used by management to assess the
performance of the business and includes information from equity accounted investees.
Other Highlights
$4.2m
average sales of completed
apartments per month*
*This is a non-statutory (non-IFRS) measure used by
management to assess the performance of the business and
includes information from equity accounted investees.
Valued at $246.4M
Settlements
*
233 Lots
319Total Sales
*
8c per share
Dividend
6.1c
Earnings
Per Share
$16.4M
Total
Comprehensive
Income
$194.3M
Total Revenue
$18.4m
average sales of off-the-plan
apartments per month*
Future Pipeline*
$1.1B
Under Construction*
641 Lots | Valued at $536.7M
Presale Book Value*
602 Lots | Valued at $439.7M
2024 Finbar Group Limited Annual Report
7
2024 Finbar Group Limited Annual Report
8
Key Financial
Metrics
SOURCE OF EARNINGS
RENTAL
INCOME
TOTAL
EARNINGS*
DEVELOPMENT
INCOME*
Pelago 79%
Fairlaines 17%
Other 4%
Development Income 90%
Rental Income 4%
Other 6%
Civic Heart 92%
AT238 7%
Dianella 1%
*This is a non-statutory (non-IFRS) measure used by management to assess the
performance of the business and includes information from equity accounted investees.
2024 Finbar Group Limited Annual Report
9
Key Financial
Metrics (continued)
TOTAL COMPREHENSIVE INCOME
$MILLION
2017
2018
2019
2020
2021
2022
2023
2024
$5.1
$13.8
$11.4
$7.1
$8.9
$11.0
$2.8
$16.4
FULLY FRANKED DIVIDEND
$ PER SHARE
Interim Dividend Final Dividend
2017
2018
2019
2020
2021
2022
2023
2024
0.06
0.06
0.06
0.03
0.04
0.04
0.00
0.08
EARNINGS PER SHARE
$ PER SHARE
2017
2018
2019
2020
2021
2022
2023
2024
$0.02
$0.06
$0.04
$0.02
$0.03
$0.04
$0.01
$0.06
2024 Finbar Group Limited Annual Report
10
Key Financial
Metrics (continued)
UNITS
TOTAL DEVELOPED UNITS*
Total Developed Units reached 7,110 by the end of FY2024 with the addition of 334 units from the completion of Civic Heart.
Finbar continues to position itself as the largest residential apartment developer in Western Australia.
2017
2018
2019
2020
2021
2022
2023
2024
5293
5675
5984
6402
6527
6655
6776
7110
$MILLION
PRESALES BOOK VALUE*
Sales achieved at Bel-Air, Civic Heart, Aurora, The Point and Garden Towers has
contributed to FY2024 presales of $439.7 MILLION.
2017
2018
2019
2020
2021
2022
2023
2024
$257.5
$194.5
$122.6
$45.6
$175.2
$349.0
$414.8
$439.7
*This is a non-statutory (non-IFRS) measure used by management to assess the
performance of the business and includes information from equity accounted investees.
$BILLION
PROJECT PIPELINE VALUE*
Finbar maintains a robust Project Pipeline of $1.1 BILLION to ensure that the company can capitalise on changing market
conditions and bring new product to the market as quickly and efficiently as possible to maximise shareholder returns.
2017
2018
2019
2020
2021
2022
2023
2024
$2.0
$1.8
$1.2
$1.3
$1.4
$1.5
$1.4
$1.1
2024 Finbar Group Limited Annual Report
11
Key Financial
Metrics (continued)
1
15
24
178
54
50
100
230
245
309
591
305
211
138
321
184
338
547
403
430
266
235
406
264
200
454
0
100
200
300
400
500
600
700
800
900
1000
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
414
0
100
200
300
400
500
600
700
2022
195
2023
319
2024
Thousands
Units
$330 $299
$232 $255
$319 $333
$365 $372 $389
$462
$519
$629
$678
$617
$730
$577
$611
$686
$706
$626
$598
$526
$559 $549
$601
$647
$852 $850
$557
Number Of Sales
Average Sales Value
AVERAGE SALES
VALUE*
1
178
54
50
100
230
245
309
591
305
211
138
321
184
338
547
403
430
266
235
406
264
200
454
0.0
0.1
0.5
0.6
0.7
1.6
0.6
0.5
1.5
1.1
1.2
0.7
1.1
0.7
1.2
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
414
1.1
0
100
200
300
400
500
600
700
2022
195
2023
0.9
0.1
0.1
0.3
15
24
0.8
0.8
0.9
0.6
0.5
0.4
Units
Sales
0.5
319
2024
0.8
Number Of Sales
Average Sales Per Day
AVERAGE SALES
PER DAY*
$166
1
15
178
100
230
245
309
591
305
211
138
321
184
338
547
403
430
266
235
406
264
200
454
$0
$4
$6
$17
$17
$37
$86
$95
$329
$133
$198
$134
$334
$304
$214
$273
0
100
200
300
400
500
600
700
0
50
100
150
200
250
300
350
400
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
414
2022
2023
Millions
Units
$268
24
50
54
$94
$45
$277
$143
$158
$167
$140
$148
$110
$195
195
2024
$271
319
Number Of Sales
Total Value
TOTAL SALES
AND VALUE*
*This is a non-statutory (non-IFRS) measure used by management to assess the
performance of the business and includes information from equity accounted investees.
2024 Finbar Group Limited Annual Report
12
Key Financial
Metrics (continued)
FOREIGN BUYER SALES*
120
100
80
60
40
20
0
Sales
FY10
FY11
FY12
FY13
FY14
FY15
FY16
FY17
FY18
FY19
FY20
FY21
FY22
FY23
FY24
25
28
43
46
44
112
52
47
74
62
20
25
34
39
40
FY24 - SALES ACROSS AGE GROUP*
30%
25%
20%
15%
10%
5%
0
60+
16%
40-49
26%
25-34
18%
50-59
25%
35-39
10%
18-24
5%
FY24 - LOCATION OF BUYER FROM THE DEVELOPMENTS*
30%
25%
20%
15%
10%
5%
0%
4%
10%
4%
7%
16%
2.6-5km
11-20km
31-40km
6%
14%
6-10km
21-30km
Regional
WA
Overseas
23%
2.5km
or less
16%
*This is a non-statutory (non-IFRS) measure used by management to assess the
performance of the business and includes information from equity accounted investees.
Interstate
2024 Finbar Group Limited Annual Report
13
Project
History
29 YEARS
77 LANDMARK DEVELOPMENTS
7110 UNITS COMPLETED
2009
21
16
114
CIRCLE EAST Northbridge
CIRCLE WEST Northbridge
CODE Perth
2008
113
111
123
81
49
CERESA Rivervale
INFINITY East Perth
ALTAIR East Perth
DOMUS Perth
DEL MAR Mandurah
2007
80
76
60
104
SOHO East Perth
AVENA Rivervale
SOL APARTMENTS West Perth
ONE28 East Perth
2005
54
43
98
64
14
ARUM Rivervale
SAMPHIRE Rivervale
WESTRALIAN East Perth
COSMOPOLITAN East Perth
RIVERSTONE South Perth
2004
94
51
25
45
MARKETRISE West Perth
175 HAY East Perth
BLUE 2 South Perth
KINGSTON West Perth
2003
30
47
ST THOMAS SQUARE Subiaco
MONTEREY BAY Port Mandurah
2001
54
47
11
25
BLUEWATER South Perth
CHELSEA GARDENS West Perth
85 MILL POINT ROAD South Perth
THE 10TH TEE The Vines
2000
68
76
1
THE RISE East Perth
WELLINGTON PLACE East Perth
ALBANY HIGHWAY MEDICAL CENTRE Victoria Park
1999
1
12
CORFIELD STREET MEDICAL CENTRE Gosnells
MATILDA BAY APARTMENTS Crawley
1998
78 PADDINGTON PLACE West Perth
1997
5
15
167 MELVILLE PARADE South Perth
SEVILLE ON THE POINT South Perth
1996
3
5
THE LINKS South Perth
19 RENWICK STREET South Perth
2024
334 CIVIC HEART South Perth
2023
121 AT238 Perth
2021
128
125
DIANELLA APARTMENTS Dianella
RIVERENA Rivervale
2020
123
167
ONE KENNEDY Maylands
SABINA Applecross
2019
128
59
250
PALMYRA APARTMENTS EAST Palmyra
REVA SOUTH PERTH South Perth
VUE TOWER East Perth
2018
244
138
AIRE WEST PERTH West Perth
AURELIA South Perth
2017
227
143
CONCERTO East Perth
MOTIVE West Leederville
2016
116
169
LINQ Northbridge
UNISON ON TENTH Maylands
2015
154
63
47
264
ARBOR NORTH Rivervale
NORWOOD PERTH Perth
TOCCATA East Perth
SUBI STRAND Subiaco
2014
188
8
98
194
SPRING VIEW TOWERS Rivervale
52 MILL POINT RD South Perth
ECCO APARTMENTS Perth
AU APARTMENTS East Perth
2013
188
131
115
43
PELAGO EAST Pegs Creek (Karratha)
ST MARKS Highgate
ADAGIO East Perth
KNIGHTSGATE Currambine
2012
111
114
128
31
LIME Victoria Park
PELAGO WEST Pegs Creek (Karratha)
FAIRLANES PERTH East Perth
18 ON PLAIN East Perth
2011
202 X2 APARTMENTS East Perth
2010
75
85
THE EDGE Victoria Park
THE SAINT East Perth
2009
34
50
62
197
71
71
VERVE Perth
HORIZON CENTRAL Maylands
HORIZON SIXTH Maylands
ROYALE Perth
REFLECTIONS EAST East Perth
REFLECTIONS WEST East Perth
2024 Finbar Group Limited Annual Report
14
Finbar
Milestones
2010s
2020s
2010
2012
2013
2020
Secured first Pilbara
project, Pelago West,
Karratha
$20m
net profit
milestone
25th Year on the ASX
Launched internal sales division – Finbar Sales
Sabina awarded Property Council WA Best Residential
Development and UDIA Judges Commendation in the High
Density Development Category
Pelago West awarded
Judge’s and UDIA High
Density Development
$30m
net profit
milestone
3000
apartments
milestone
Completed company’s first
Pilbara project
Relocated to Fairlanes building,
East Perth (13 staff)
Fairlanes awarded winner UDIA
High Density Development
2021
2013
2021
2012
FINALIST
1990s
Lists on ASX as Property
Development Company
operating out of a 2
bedroom Como apartment
Commenced 1st
Development Seville on the
Point, South Perth
Completed 1st
Development Seville on
the Point, South Perth
Maiden net profit
$0.7m
$1m
net profit
milestone
1995
1997
1998
2024 Finbar Group Limited Annual Report
15
2019
2014
2024
2015
2017
Launched Property
management division –
Finbar to Rent
6000
apartments
milestone
Completed landmark Civic Heart
project; Perth’s tallest residential
building and WA’s largest single-
stage strata development
7000
apartment
milestone
St. Mark’s awarded
winner UDIA High
Density Development
and Urban Renewal
4000
apartments
milestone
Record launch at Aurelia, with
$66m of sales in the 1st month
Completed Finbar’s largest
development to date, Subi Strand
Launched the Finbar Loyalty Club.
An exclusive rewards program for
all Finbar buyers, past & present
Spring View Towers awarded
winner UDIA High Density
Development
Completed WA’s tallest
residential apartment
development to date, Concerto
Concerto awarded winner UDIA
High Density Development
Completed over $3b worth of
developments since 1995
5000
apartments
milestone
29 years on the ASX
Our reputation is everything to us. Since we listed Finbar on the ASX 29 years ago, we
have built our name on the back of an uninterrupted run of successful developments,
from our first project, Seville on the Point, to Westralian, Pelago, Fairlanes, Subi Strand,
Concerto and our award-winning Sabina Applecross. With the successful completion of our
landmark Civic Heart development, Finbar continues to prove why it is WA’s leading and
most trusted residential apartment developer.
2017
2015
2014
2000s
Relocated to first
corporate office,
Preston Street
South Perth
(4 staff)
Completed
Westralian, first
luxury project on
Terrace Road,
East Perth
$100m market
capitalisation
1000
apartments
milestone
$10m
net profit
milestone
Inclusion in All
Ordinaries Index
2000
apartments
milestone
2001
2005
2006
2008
2009
2024 Finbar Group Limited Annual Report
16
2024 Finbar Group Limited Annual Report
17
CIVIC HEART
We are proud to announce the completion of our
landmark Civic Heart development in FY24.
Civic Heart is Western Australia's largest single-
stage strata development and stands as the tallest
residential tower in Perth. It also holds the title of
being the tallest building in the state outside the
Perth CBD.
This landmark development lights up the south-of-
the-river skyline, with the epitome of prestigious
living and phenomenal views across the cityscape.
308 exceptionally inspired residences set within
two iconic towers offer a mixture of apartments,
sky homes and penthouses designed to exude
luxury living through every perfect detail from the
sweeping curves of the podium and tower, to its
beautifully appointed finishes and illuminated crown.
Three levels of world-class amenities dedicated to
a range of facilities and outdoor spaces including
guest apartments, putting green, wellness spa,
gyms, theatres, kids indoor and outdoor play areas,
and a sky deck on level 37 with private dining rooms.
2024 Finbar Group Limited Annual Report
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FOLLOW THE
JOURNEY
Civic Heart began as a vision to
realise a once-in-a-generation,
360-degree architectural
landmark that weaves together
past, present, and future. In
2024, that dream became
a beautiful reality, with the
apartments and plazas now
alive with the sounds of happy
people from near and far.
The journey has been truly
remarkable. Beginning all the
way back in 2020, we navigated
the uncertainty of a global
pandemic and overcame many
challenges to reach successful
completion of what is now
officially Finbar’s largest and
most impressive project to date.
SEPT 2020
GRAND PUBLIC
LAUNCH
CONSTRUCTION
A grand welcoming. From the
moment we launched, Civic Heart was
met with a groundswell of positive
support, enquiries and sales.
The journey begins. Buyers and
stakeholders gathered to celebrate
the start of construction with an
exciting soil turning ceremony.
A monumental effort. The sheer scale of the project
brought a range of construction challenges. Despite
these, we successfully completed WA’s largest
residential building.
TURNING OF THE SOIL
& CONSTRUCTION
COMMENCEMENT
FEB 2021
2021 – 2024
2021
2022
2023
2024
2024 Finbar Group Limited Annual Report
19
TOPPING OUT
A labour of love. We celebrated ‘topping out’ the
Mill Point Tower with our builder, architect, and
partners in recognition of everyone’s hard work
and dedication.
DEC 2023
PROJECT COMPLETION
A masterpiece is complete. The special occasion was
honoured with a luxurious grand opening party, bringing
together all who brought Civic Heart to life, and the lucky
new residents who will call it home.
JUNE 2024
2024 Finbar Group Limited Annual Report
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THE PULSE OF PRESTIGE
South Perth has a new landmark. Civic Heart’s iconic form rises above
the cityscape with its sweeping curves and illuminated crown, claiming
the mantle as Perth’s tallest residential tower.
Eateries and laneways bring the streetscape to life. Here, Civic
Heart caters to your every daily need while treating residents to a
sophisticated lifestyle of colour, culture, and quiet indulgence.
2024 Finbar Group Limited Annual Report
21
SOPHISTICATION
REACHES NEW HEIGHTS
Civic Heart delivers 308 beautifully appointed 1, 2, and
3 bedroom apartments across two towers, thoughtfully
crafted to offer the utmost comfort and luxury matched
with phenomenal views across the cityscape.
The Platinum apartments blend elegance with functionality,
capped by the expansive living space in the Sky Homes and
the unparalleled experience of the Penthouses.
A CROWNING
MASTERPIECE
Sitting proudly atop the 37th floor of the Mill Point Tower, The
South Perth Skydeck’s tasteful collection of dining rooms and
social spaces treat residents and guests to mesmerising views
across the river and skyline, day, and night.
2024 Finbar Group Limited Annual Report
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INDULGENT
AT-HOME
EXPERIENCES
Civic Heart offers world-class amenities
unlike anything seen in Perth, from an opulent
swimming pool and lounges to theatrettes,
outdoor spaces, kids’ play areas, pet play and
wash areas, putting greens, wellness centres,
and private dining rooms.
2024 Finbar Group Limited Annual Report
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REJUVENATING THE SOUTH
PERTH COMMUNITY
Nestled in South Perth by the beautiful Swan River, Civic Heart pays
homage to the surrounding heritage precinct, blending old with new
to create a vibrant hotspot for residents and locals to gather, meet,
mingle, and explore.
Cafes, restaurants & retail will activate the streetscape with
interlinked alfresco laneways and canopied piazzas, blending into a
rejuvenated, pedestrian-friendly Mends Street alive with art, culture,
and a vibrant community atmosphere.
2024 Finbar Group Limited Annual Report
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We’ve come a long way since the dream started as 3 people working out of a
makeshift office in Como. Now a 29-strong team led by experienced and long
serving management, we’re in prime position to push the boundaries at the
forefront of Western Australia’s lifestyle property market.
RONALD CHAN
Executive Director
20 years
JOHN CHAN
Executive Chairman
29 years
DARREN PATEMAN
Managing Director
29 years
Our Finbar
OUR PEOPLE
- A team of 17 staff in Finbar’s head office
- A team of 9 staff in Finbar to Rent
- A team of 3 staff in Finbar Sales
- Led by an experienced and long serving management team, with strong leadership skills and an
excellent track record
OUR BUSINESS
- Retains a strong brand and a highly regarded reputation in WA
- Operates on a low cost base providing attractive profit margins and shareholder returns
- Maintains exemplary relationships with suppliers and stakeholders
- Manages a pipeline of projects to ensure economies of scale and future growth
OUR COMMITMENT
- Our commitment to our customers, shareholders, state and local government and the
environment has seen Finbar remain WA’s largest and most trusted apartment developer
2024 Finbar Group Limited Annual Report
25
OUR PROJECTS
- Represent some of Perth’s most prestigious and well-appointed lifestyle apartments
- Remain committed to creating progressive and innovative designs which represent value for money
- Offer a successful fusion of residential, office and public space
OUR INVESTMENT PROPERTIES
- Include the Fairlanes and Pelago buildings leased to reputable and proven businesses and individuals
- Provide consistent annual revenue from investments
- Ensure these additional revenue streams contribute to and smooth annual earnings
OUR FUTURE
- Our vision is to remain WA’s leading medium to high density apartment developer
- Continue to focus development efforts in and around inner city Perth
- Sustain and enhance the quality of inner city living for current and future generations
Finbar continues to elevate the quality of inner city living in Perth, delivering
prestigious, well-appointed lifestyle apartments that artfully fuse office and
public spaces in progressive and innovative designs.
TERENCE PEH
Non-Executive Director
ELDON WAN
Non-Executive Director
2024 Finbar Group Limited Annual Report
26
INSPIRED BY MODERN
LIFESTYLES
At Finbar, we’re forever evolving to treat residents to the most
thoughtful amenities in sync with how they like to live. From
working out to working from home, accomodating guests to
treating pets like family, each development is customised to the
needs of its residents to ensure we continue to offer the most
relevant and responsive inner-city lifestyles.
Modern
Amenities
DRIVING A
BETTER FUTURE
Current and future projects will have an allowance in building
design and management provisions that enable you to install an
EV charging station on your car bay at any time. Enjoy seamless
transition to electric transport down the road, when you’re ready.
WORKS FOR YOU
Working from home has become the new normal in a post-
pandemic world. As thought leaders in this space, Finbar is
innovating ahead of the trend with dedicated ‘WFH’ spaces
in Civic Heart, Aurora,
AT238 and Garden
Towers, from business
centres, to meeting
rooms and zoom pods
that make staying
connected seamless.
PLAYTIME IN THE CITY
No longer the exclusive domain of couples and professionals,
inner city apartments are growing in demand from young
families seeking low-care minimalist living close to
entertainment precincts. Civic Heart and Garden Towers
raise the energy with exciting kids’ playrooms and outdoor
playgrounds, while AT238’s gaming zone complete with an
arcade machine and PS5 mean it’s on for young and old.
GLAMPING
Garden Towers will pioneer a one-of-a-kind glamping
nook, treating residents to a rare staycation experience
overlooking the shimmering river and stadium lights.
IMMERSIVE EXPERIENCES
Finbar developments understand resident needs to a tee.
Garden Towers’ state-of-the-art virtual golf driving range offers
an immersive experience where players can finetune their
swing in the comfort of their own home, while putting greens
at Civic Heart and Aurora offer the chance to work on your
short game at anytime.
2024 Finbar Group Limited Annual Report
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STAY A LITTLE
LONGER
Our residents said they wanted the
flexibility of having family and friends visit,
without having to send them away to stay
at a hotel – and we listened. Following
the overwhelming success at Sabina
Applecross, Civic Heart and Aurora have
incorporated Finbar’s guest apartment
concept, allowing residents to book a
suite to accommodate their loved ones
while visiting.
BEST FRIENDS
WELCOME
Dog ownership in Australia is increasing —
and so is inner-city apartment living. Finbar
brings the two worlds together thoughtfully
and naturally, with pet wash facilities and pet
play areas at Civic Heart, Garden Towers and
AT238 inviting residents to embrace all the
physical and emotional benefits that come
from sharing an active city life with your four-
legged friend.
MOVIE LOVERS
At Garden Towers, Civic Heart, Aurora
and AT238 residents can enjoy the latest
movies, sports or big events in the luxury
of their own air-conditioned cinema,
with plush seating and the latest home
entertainment system on the big screen.
HEALTH AND WELLNESS
We value the importance of holistic wellness. At Civic Heart, Garden Towers and
Aurora, residents can enjoy a selection of state-of-the-art gyms, soothing massage
rooms, private consultation areas, rejuvenating sauna and steam rooms.
2024 Finbar Group Limited Annual Report
28
As WA’s largest and most trusted
apartment developer, Finbar is committed
to operating in a manner that shows the
highest levels of environmental, social
and governance standards.
From its very early days, Finbar’s success has been guided by an
ethos to have positive environmental and social impacts and to be
ethical and transparent in its approach to meeting and exceeding
all regulations that govern how it operates.
The company’s ethos is to develop better lifestyles for people and
this guides the approach to ESG. Finbar strives to be a leader in
WA, to be a trusted and respected joint venture partner, employer
and neighbour to its stakeholders across the community.
ESG at Finbar
– Using innovative, contemporary, and
light-weight construction techniques
to reduce carbon emissions
– Optimising design and material
selection to reduce energy usage
after handover
– Aiming to achieve high energy
efficiency and thermal comfort
ratings for each project
– Reducing waste through compaction
and building management of diverse
waste streams
– Reducing land clearing through
offering affordable and diverse infill
housing options
– Promoting adoption of EV through
providing backbone infrastructure
to catalyse the future installation of
chargers
– Providing affordable & diverse housing
options across the Perth metro area
– Providing a wide range of amenities in
each project with a focus on health and
wellness
– Supporting local community
organisations
– Importance of employee diversity
& wellbeing
– Ensuring all our contractors and
suppliers comply with the modern
slavery initiatives and requirements.
– Providing positive policy outcomes
through membership and committee
input into the Property Council
of Australia (WA) & the Urban
Development Institute of Australia (WA)
– Broadening the rate base of local
governments, supporting the delivery
of services they provide to the local
community
– Corporate Governance Statement
– Materiality assessment and
identification of key ESG issues
– Long serving and experienced
management and leadership team
– Ethical conduct and responsible
business practices
– Risk management and long term
strategic direction
– Nurturing employee growth &
enhancing skills through training and
professional development.
– Data security and privacy
Environment
Social
Governance
2024 Finbar Group Limited Annual Report
29
COMPLETED PROJECTS
CIVIC HEART
S O U T H P E R T H
AT238
P E RT H
REVA
S O U T H P E R T H
2024 Finbar Group Limited Annual Report
30
CIVIC HEART
99 Mill Point Road & 3 Mends Street, South Perth
This iconic site bounded by Mends Street, Labouchere Road
and Mill Point Road offers luxurious apartments, world-class
resort facilities, and a thriving ground floor commercial precinct
anchored by the heritage South Perth Police Station and Post
Office. Located in close proximity to the Swan River, Perth
Zoo, and the Mends Street retail high street, Civic Heart is a
transformational development that has achieved strong sales in
a highly competitive localised market.
Project Company
1 Mends Street Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 52.5%
Construction Commenced
Feb 21
Construction Completed
Jun 24
Total Lots
334
Approximate Total Project
Sales Value
$448.1m
Value of Sales to Date
$335.5m
Lots Sold
279 (84%)
Lots Unsold
55 (16%)
2024 Finbar Group Limited Annual Report
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AT238
238 Adelaide Terrace, Perth
AT238 comprises 119 residential apartments and two ground
floor commercial lots in a 32 storey tower and represents
Finbar’s tenth development along Adelaide Terrace.
Embracing spacious semi-enclosed balconies, AT238 is
positioned as an unique apartment product with a striking
glazed façade and rooftop amenities that take full advantage
of the expansive views.
Project Company
240 Adelaide Terrace Pty
Ltd
Entity Type
Equity Accounted Investee
Finbar's Share of Project Profit
50%
Construction Commenced
Mar 21
Construction Completed
Apr 23
Total Lots
121
Approximate Total Project
Sales Value
$99.7m
Value of Sales to Date
$82.0m
Lots Sold
106 (88%)
Lots Unsold
15 (12%)
2024 Finbar Group Limited Annual Report
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REVA
5 Harper Terrace, South Perth
Adjacent to Finbar’s highly successful Aurelia project in
South Perth, Reva is situated fronting Harper Terrace
and comprises of 41 luxury one, two, and three bedroom
apartments with rooftop amenities, as well as 18
commercial lots that were developed within the Harper
Terrace structure.
Project Company
5-7 Harper Terrace Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 100%
Construction Commenced
Nov 17
Construction Completed
Feb 19
Total Lots
59
Approximate Total Project
Sales Value
$45.7m
Value of Sales to Date
$44.0m
Lots Sold
56 (95%)
Lots Unsold
3 (5%)
2024 Finbar Group Limited Annual Report
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PROJECTS
UNDER CONSTRUCTION
AURORA
A P P L E C R O S S
THE POINT
R I V E R VA L E
GARDEN
TOWERS
E A ST P E R T H
2024 Finbar Group Limited Annual Report
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AURORA APPLECROSS
3 Kintail Road, Applecross
The second stage of three in the Canning bridge precinct,
Aurora combines luxurious apartment finishes & world-class
facilities within an affluent Applecross address. Featuring a
central shared lane and public amenity piazza.
Project Company
Finbar Applecross Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 50%
Construction Commenced
FY22
Estimated Completion
1H FY25
Total Lots
121
Approximate Total Project
Sales Value
$155.4m
Value of Sales to Date
$67.7m
Lots Sold
70 (58%)
Lots Unsold
51 (42%)
2024 Finbar Group Limited Annual Report
35
S P R I N G S R E S I D E N C E S
THE POINT
31 Rowe Avenue, Rivervale
The Point comprises 167 one, two, and three bedroom
apartments and 9 commercial lots on the ground floor and
will be situated at the main entrance to the Springs precinct,
opposite the Aloft Hotel.
Project Company
31 Rowe Avenue Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 65%
Construction Commenced
FY22
Estimated Completion
1H FY25
Total Lots
176
Approximate Total Project
Sales Value
$111.5m
Value of Sales to Date
$81.5m
Lots Sold
145 (82%)
Lots Unsold
31 (18%)
2024 Finbar Group Limited Annual Report
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GARDEN TOWERS
110 Plain Street & 8 DeVlamingh Ave, East Perth
Positioned opposite Queens Gardens in East Perth, Garden
Towers will be comprised of 331 one, two, and three bedroom
apartments plus 13 commercial units.
Project Company
Garden Towers East Perth
Pty Ltd
Entity Type
Equity Accounted Investee
Finbar's Share of Project Profit 50%
Construction
Commenced
Apr 24
Estimated Completion
FY27
Total Lots
344
Approximate Total Project
Sales Value
$270.2m
Value of Sales to Date
$148.8m
Lots Sold
223 (65%)
Lots Unsold
121 (35%)
2024 Finbar Group Limited Annual Report
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NEW TO MARKET
BEL-AIR
APARTMENTS
B E L M O N T
2024 Finbar Group Limited Annual Report
38
BEL-AIR APARTMENTS
239 Great Eastern Highway, Belmont
Bel-Air Apartments has 194 one, and two bedroom apartments
plus 2 ground floor commercial spaces.
Project Company
239 Great Eastern
Highway Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 100%
Construction
Commencement
FY25
Estimated Completion
TBC
Total Lots
196
Approximate Total Project
Sales Value
$113.1m
Value of Sales to Date
$65.1m
Lots Sold
112 (57%)
Lots Unsold
84 (43%)
2024 Finbar Group Limited Annual Report
39
FUTURE PROJECTS
ROMEO
A P P L E C R O S S
2 HOMELEA
COURT
R I V E R VA L E
PALMYRA
APARTMENTS WEST
PA L M Y R A
LOT 888
R I V E R VA L E
LOT 1000
R I V E R VA L E
FORMER ABC
STUDIOS
E A ST P E R T H
2024 Finbar Group Limited Annual Report
40
PALMYRA APARTMENTS WEST
45 McGregor Road, Palmyra
The Palmyra second stage has received an amended DA to
incorporate market feedback from stage one. Comprising
130 residential apartments, the introduction of lifts and
re-alignment of apartment typologies within a low-rise
structure, this development is designed to respond to first
home buyer and downsizer drivers within the strong owner-
occupier purchaser demographic.
Project Company
43 McGregor Road Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 50%
Construction Commencement
TBC
Total Lots
130
Approximate Total Project
Sales Value
$73m
ROMEO
912 Canning Highway, Applecross
Located only metres from the Swan River and
approximately 600 metres to the Canning Bridge Train
Station, this 2,620sqm site fronting Canning Highway has
DA approval as the third of three stages for 152 residential
apartments and 3 ground floor commercial tenancies
within a podium and 26 storey tower built form.
Project Company
Finbar Applecross Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 50%
Construction Commencement
TBC
Total Lots
155
2024 Finbar Group Limited Annual Report
41
2 HOMELEA COURT
Cnr Rowe Avenue & Homelea Court, Rivervale
2 Homelea Court comprises 3,770 square meters of land
located on the corner of Rowe Avenue and Homelea Court,
opposite Finbar’s Spring View Towers, is proposed to be
developed into a project consisting of approximately 171
apartments within an 12 level building.
Project Company
2 Homelea Court Springs
Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 100%
Construction Commencement TBC
Total Lots
TBC
Approximate Total Project
Sales Value
$92m
LOT 1000
32 Riversdale Road, Rivervale
Lot 1000 comprises 4,069 square metres of absolute
waterfront land with expansive views of the Swan River,
Stadium Precinct, and Perth CBD. Development approval
has been received for a 19 storey tower with 143 units, an
expansive 19th floor rooftop Sky Deck.
Project Company
32 Riversdale Road Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 50%
Construction Commencement TBC
Total Lots
143
2024 Finbar Group Limited Annual Report
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FORMER ABC STUDIOS
187 Adelaide Terrace, East Perth
The former ABC Radio Studios heritage building provides a
GFA of 3,711sqm over three levels. The Company continues
to explore feasible development outcomes in the context
of recently announced City of Perth proposed planning
scheme changes. These planning changes seek to support
residential development in the city through providing
significant increases in plot ratio.
Project Company
Finbar Sub 104 Pty Ltd
Entity Type
Fully Owned Subsidiary
Finbar's Share of Project Profit 100%
Construction Commencement TBC
Total Lots
TBC
LOT 888
2 Hawksburn Road, Rivervale
The current approved DA comprises a six level office
building with 6,250sqm NLA and 236 carbays.
Project Company
Rowe Avenue Pty Ltd
Entity Type
Equity Accounted Investee
Finbar's Share of Project Profit 50%
Construction Commencement
TBC
Total Lots
TBC
2024 Finbar Group Limited Annual Report
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INVESTMENT PROPERTIES
FAIRLANES
E A ST P E R T H
PELAGO
K A R R AT H A
AURELIA
S O U T H P E R T H
2024 Finbar Group Limited Annual Report
44
FAIRLANES
181 Adelaide Terrace, East Perth
Total SQM
7,584
Office SQM
7,114
Retail SQM
470
FY25 Forecast Rent
$1.05m
SQM Leased
4260.4
AURELIA
1 Harper Terrace, South Perth
Total SQM
788
Estimated sales value
$5.3m
Estimated income value
$169,000 p.a.
PELAGO
Sharpe Avenue, Karratha
Total Lots
116
Residential Lots
98
Commercial Lots
18
FY25 Forecast Rent
$7.6m
Lots Leased
86
Residential Lots Leased
74
Commercial Lots Leased
12
2024 Finbar Group Limited Annual Report
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2024 Finbar Group Limited Annual Report
46
CONTENTS
PAGE
Directors’ Report
(including Corporate Governance Statement)
47
Consolidated Statement of Profit or Loss and Other
Comprehensive Income
62
Consolidated Statement of Changes in Equity
63
Consolidated Statement of Financial Position
64
Consolidated Statement of Cash Flows
65
Notes to the Consolidated Financial Statements
66
Consolidated Entity Disclosure Statement
96
Directors’ Declaration
97
Independent Auditor’s Report
98
Lead Auditor’s Independence Declaration
103
ASX Additional Information
104
Financial
Report
Finbar Group Limited
2024 Finbar Group Limited Annual Report
47
DIRECTORS’ REPORT
For the Year Ended 30 June 2024
The Directors present their report together with the consolidated financial report of the Group, comprising Finbar Group Limited
(‘the Company’), its subsidiaries and the Group’s interest in equity accounted investees for the financial year ended 30 June 2024
and the independent auditor’s report thereon.
CONTENTS OF DIRECTORS’ REPORT
PAGE
1
Directors
48
2
Company Secretary
49
3
Directors’ Meetings
49
4
Corporate Governance Statement
49
4.1 Board of Directors
50
4.2 Remuneration Committee
50
4.3 Remuneration Report - Audited
50
4.3.1 Principles of Remuneration - Audited
50
4.3.2 Directors’ and Executive Officers’ Remuneration - Audited
52
4.3.3 Analysis of Bonuses included in Remuneration Report - Audited
53
4.3.4 Directors’ and Executives Interests - Audited
54
4.3.5 Equity Instruments - Audited
54
4.4 Audit Committee
54
4.5 Risk Management
55
4.6 Ethical Standards
55
4.7 Communication with Shareholders
56
4.8 Diversity
56
5
Principal Activities
57
6
Operating and Financial Review
57
7
Dividends
59
8
Events Subsequent to Reporting Date
59
9
Likely Developments
59
10 Directors’ Interests
60
11 Indemnification and Insurance of Officers
60
12 Non-audit Services
60
13 Lead Auditor’s Independence Declaration
61
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
48
1. Directors
The Directors of the Company at any time during or since the end of the financial year are:
Executive Director and Chairman
John CHAN - BSc, MBA, MAICD
Director since 27 April 1995
Chairman since 15 July 2010
John Chan is Executive Director and Chairman of Finbar, and a Director of its subsidiaries and equity accounted investees.
John was appointed director in 1995 and was instrumental in re-listing Finbar on the ASX as a property development company. Prior to joining
Finbar, John headed several property and manufacturing companies both in Australia and overseas.
John holds a Bachelor of Science from Monash University in Melbourne and a Master of Business Administration from the University of
Queensland. John is a Member of the Australian Institute of Company Directors, is a Trustee for the Western Australian Chinese Chamber of
Commerce, and is a former Senate Member of Murdoch University.
Managing Director
Darren John PATEMAN - EMBA, GradDipACG, ACSA, AGIA, MAICD
Director since 6 November 2008
Managing Director since 15 July 2010
Darren Pateman is the Managing Director of Finbar, and a Director of its subsidiaries and equity accounted investees.
Darren commenced with Finbar prior to its relisting on the ASX as a property development company in 1995 and in this time has played a
primary role in developing Finbar’s systems, strategy and culture.
Darren has held several positions in his 29 years with the company which has given Darren an intimate knowledge of the key aspects of
Finbar’s business. Darren was formerly Company Secretary from 1996 to 2010, Chief Executive Officer from 2008 to 2010, and was appointed
Managing Director on 15 July 2010.
Darren is a Chartered Secretary and holds an Executive Master of Business Administration from the University of Western Australia and
a Graduate Diploma in Applied Corporate Governance (GradDipACG). Darren is an Associate of the Institute of Chartered Secretaries and
Administrators, is a Member of the Australian Institute of Company Directors, and is the Division Vice President (WA Division Council) for the
Property Council of Australia.
Executive Director and Chief Operations Officer
Ronald CHAN
Director since 24 February 2017
Ronald Chan is the Chief Operations Officer of Finbar, and a Director of Finbar’s subsidiaries and equity accounted investees.
Ronald joined the Board as an Executive Director on 24 February 2017. Ronald brings 20 years of experience in Finbar’s Company operations
where he has worked in several roles in the organisation including marketing, contract administration, and in 2013 was appointed Chief
Operations Officer. In this role Ronald has gained an intimate understanding of the Company’s relationships and systems and managed the
Company’s transition to digital and online marketing strategies.
Non-executive Director
Terence Siong Woon PEH - B.Comm, M.Comm
Director since 24 April 2018
Terence Peh joined the Board on 24 April 2018. Terence is Chief Executive Officer and Executive Director of Chuan Hup Holdings Limited, an
investment company listed on the Singapore Stock Exchange, and Finbar’s largest corporate shareholder.
Terence has over 25 years of experience in property development investment and project management in Asia Pacific, and management
experience in finance in the marine and electronics manufacturing services industries.
Terence obtained his Bachelor of Commerce in Marketing from Curtin University and a Master of Commerce in Finance from the University of
New South Wales.
Non-executive Director
Eldon WAN - B Acc, FCA Singapore
Director since 31 January 2023
Eldon Wan joined the Board on 31 January 2023. Eldon is the Chief Operating Officer of Chuan Hup Holdings Limited, an investment company
listed on the Singapore Stock Exchange, and Finbar’s largest corporate shareholder.
Eldon has over 26 years of experience in the finance and accounting sectors. He has accumulated industry experience in mergers and acquisitions,
financial and management reporting, budgeting, taxation, treasury as well as corporate governance and risk management matters.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
49
1. Directors (continued)
Non-executive (Independent) Director
Lee VERIOS - LLB, MAICD
Director since 6 December 2011 to 18 October 2023
Lee Verios joined the Board in December 2011. He is a well credentialed commercial lawyer having practised in Western Australia for over
40 years.
Until his retirement from practising law in 2012, Lee was partner in the international law firm of Norton Rose and the leader of their
Commercial Property division in Perth. Throughout his legal career, Lee has held senior management roles in each of the firms of which he
has been a member.
In addition to his legal practice, Lee is an experienced company director, having held positions in a variety of public and private enterprises.
Lee is a member of the Australian Institute of Company Directors, the Law Society of WA and was previously Chairman of the Australian
Indonesian Business Council (WA Branch).
Lee retired as a director of Finbar on 18 October 2023.
2. Company Secretary
The Company Secretary of the Company at any time during or since the end of the financial year is:
Edward Guy BANK - B Bus, ASCPA
Company Secretary since 2 December 2016
Edward Bank is the Company Secretary of Finbar, and of Finbar’s Subsidiaries and equity accounted investees. Ed is a Certified Practicing
Accountant with 30 years experience in private practice including 8 years as the Company’s external accountant. Ed joined the Company in
2005 in the capacity of Chief Financial Officer.
Ed continues to hold the position of Chief Financial Officer.
3. Directors’ Meetings
The number of Directors’ meetings attended by each of the Directors of the Company, whilst being a Director, during the financial year are:
Director
Board
Meetings
Held
Board
Meetings
Attended
Resolutions
Without
Meetings
Audit
Committee
Meetings
Held
Audit
Committee
Meetings
Attended
Remuneration
Committee
Meetings Held
Remuneration
Committee
Meetings
Attended
John CHAN
4
4
3
1
1
2
2
Darren John PATEMAN
4
4
3
N/A
N/A
N/A
N/A
Ronald CHAN
4
4
3
N/A
N/A
N/A
N/A
Lee VERIOS*
2
2
1
1
1
1
1
Terence Siong Woon PEH
4
4
3
2
2
2
2
Eldon WAN
4
4
3
1
1
1
1
* Lee Verios retired on 18 October 2023.
4. Corporate Governance Statement
The Board (‘Board’) of Finbar Group Limited (‘Finbar’ or ‘the Company’), its subsidiaries and equity accounted investees (collectively the
Group) is committed to maintaining a high standard of corporate governance in the conduct of the organisation’s business in order to create
and deliver value to shareholders. In this regard, Finbar has established a corporate governance framework, including corporate governance
policies and charters to assist in this commitment. A copy of these policies and charters are available from the governance page of Finbar’s
website, www.finbar.com.au and are referenced throughout this document where relevant.
The framework is reviewed and revised in response to changes to law, developments in corporate governance best practice and changes to
the Finbar business environment.
As a listed entity, Finbar is required to comply with Australian laws including the Corporations Act 2001 (Cth) and the Australian Securities
Exchange Listing Rules, and to report against the ASX Corporate Governance Council’s Principles and Recommendations.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
50
4. Corporate Governance Statement (continued)
4.1 Board of Directors
Role of the Board
The Board Charter sets out the Board’s role, powers and duties, and establishes the functions reserved for the Board and those which are
delegated to the management. The Board’s primary role is the protection and enhancement of long-term shareholder value. To fulfil this role,
the Board is responsible for the overall corporate governance of the Group.
The Board has delegated responsibility for the operation and administration of the Group to the Executive Chairman, the Managing Director
and Senior Executives.
Composition of Board
The Board recognises the importance of ensuring that Directors are free from interests and relationships that could, or could reasonably be
perceived to materially interfere with the Director’s ability to exercise independent judgement and act in the Group’s best interests.
Accordingly, the Board has adopted guidelines, set out in the Board Charter, which are used to determine the independence of the Directors.
Directors must keep the Board advised, on an ongoing basis, of any interest that could potentially conflict with those of the Group. Where
the Board believes that a significant conflict exists for a Director on a Board matter, the Director concerned will be restricted from receiving
materials, discussing or voting on the matter.
Details of each of the non-executive Directors are set out in the Directors Report (pages 48 and 49).
4.2 Remuneration Committee
The Remuneration Committee Charter sets out the Remuneration Committee’s role, powers and duties, and establishes the functions
delegated to the Committee by the Board. The Remuneration Committee reviews and makes recommendations to the Board on remuneration
packages and policies applicable to the Executive Officers and Directors themselves of the Company and of other Group Executives. It is also
responsible for share option schemes, incentive performance packages, superannuation entitlements, retirement and termination entitlements,
fringe benefits policies and professional indemnity and liability insurance policies.
The following directors serve on the Remuneration Committee:
• Terence Siong Woon PEH (Chairman) - Non-executive Director
• John CHAN - Executive Director
• Lee VERIOS - Non-executive Independent Director (Retired on 18 October 2023)
• Eldon WAN - Non-executive Director
The Remuneration Committee Charter sets out the process for the periodical evaluation of the performance of the Executive Chairman and
Managing Director. These evaluations have been conducted during the period.
The Remuneration Committee Charter also sets out the process for the periodical evaluation of the performance of the Senior Executives. The
Remuneration Committee in consultation with the Executive Chairman and Managing Director are responsible for the periodical evaluation of
the performance of the Senior Executives. These evaluations have been conducted during the period.
Finbar has a written agreement, either in the form of an employment contract or letter of employment, with each Executive Director and Senior
Executive which sets out the terms of their appointment.
A copy of the Remuneration Committee Charter is available on Finbar’s website www.finbar.com.au.
4.3 Remuneration Report - Audited
4.3.1 Principles of Remuneration
Remuneration of Directors and Executives is referred to as remuneration as defined in AASB 124 Related Party Disclosures and Section 300A of
the Corporations Act 2001.
Key management personnel have authority and responsibility for planning, directing and controlling the activities of the Group, including
Directors of the Company and other Executives. Key management personnel comprise of the Directors and Executives of the Company and the
Group, including the Section 300A Executives.
Remuneration levels for key management personnel and the secretary of the Company, and key management personnel and secretaries of
the Group, are competitively set to attract and retain appropriately qualified and experienced Directors and Executives. The Remuneration
Committee periodically obtains independent advice on the appropriateness of remuneration packages of both the Company and the Group
given trends in comparative companies both locally and internationally and the objectives of the Company’s remuneration strategy.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
51
4. Corporate Governance Statement (continued)
4.3 Remuneration Report - Audited (continued)
4.3.1 Principles of Remuneration (continued)
The remuneration structures explained below are designed to attract suitably qualified candidates, reward the achievement of strategic
objectives and achieve the broader outcome of creation of value for shareholders. The remuneration structures take into account:
• the capability and experience of the key management personnel;
• the key management personnel’s ability to control the Group’s performance;
• the key management personnel’s contribution to revenue and future earnings potential;
• the key management personnel’s length of service;
• project outcomes; and
• the Group’s performance including:
- the Group’s earnings;
- the growth in share price and delivering constant returns on shareholder wealth; and
- the amount of incentives within each key management person’s remuneration.
Remuneration packages include a mix of fixed and variable remuneration, short-term performance-based incentives and can include long-term
performance-based incentives.
Fixed Remuneration
Fixed remuneration consists of base remuneration (which is calculated on a total cost basis and includes any fringe benefit tax charges related
to employee benefits including motor vehicles), as well as employer contributions to superannuation funds.
Remuneration levels are reviewed annually through a process that considers individual, business segment and overall performance of the
Group. In addition, where appropriate, external consultants provide analysis and advice to ensure the Directors’ and Senior Executives’
remuneration is competitive in the market place. A Senior Executive’s remuneration is reviewed on promotion.
Performance Linked Remuneration
Performance linked remuneration includes short-term incentives (STI) and can include long-term incentives (LTI), which are designed to
reward key management personnel for meeting or exceeding their financial and personal objectives. The short-term incentive is an ‘at risk’
bonus provided in the form of cash, whilst the long-term incentive is provided as shares or options over ordinary shares of the Company under
the rules of the Employee Incentive Plan 2013 and the Director Share Plan 2014. As at 30 June 2024, there were no options on issue.
Short-term Incentive
The Remuneration Committee has elected to set the primary financial performance objective of ‘profit before tax’ as the key measure for
the calculation of the short term incentives of key management personnel. The non-financial objectives vary with position and responsibility
and include measures such as those outlined above. The STI for the current period was wholly based on a percentage of ‘profit before tax’.
Contractual amounts are accrued in the current year and discretionary amounts are accounted for in the year of payment. The contractual
amount is set at 3.3% of ‘profit before tax’ for the 2024 financial year.
At the end of the financial year the Remuneration Committee assess the actual performance of the Group, the relevant segment and the
individual key management personnel’s contribution to the Group. The performance evaluation in respect of the year ended 30 June 2024 has
taken place in accordance with this process.
Long-term Incentive
Incentive shares or options issued under the Employee Incentive Plan 2013 or the Director Share Plan 2014 are made in accordance with
thresholds set in the plans approved by shareholders at the relevant Annual General Meeting, subject to the Board’s discretion.
Short-term and Long-term Incentive Structure
The Remuneration Committee considers that the above performance-linked remuneration structure is generating the desired outcome. The
evidence of this is in respect to the long term historical profit and dividend growth of the Company, coupled with the long term retention of key
management personnel resulting in the retention of Company intellectual property.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
52
4. Corporate Governance Statement (continued)
4.3 Remuneration Report - Audited (continued)
4.3.1 Principles of Remuneration (continued)
Consequences of Performance on Shareholders Wealth
In considering the Group’s performance and benefits for shareholder wealth, the Remuneration Committee has regard to the following indices
in respect of the current financial year and the previous four financial years:
2024
2023
2022
2021
2020
Total comprehensive income
$16,427,000
$2,782,000
$10,975,000
$8,863,000
$7,068,000
Profit before tax
$24,002,000
$3,948,000
$15,048,000
$12,043,000
$10,488,000
Dividends paid
$0
$5,442,000
$10,884,000
$8,163,000
$13,606,000
Change in share price
$0.18
-$0.02
-$0.17
$0.15
-$0.14
Return on capital employed
8.49%
1.84%
5.06%
3.82%
4.47%
Return on total equity
6.40%
1.16%
4.52%
3.65%
2.92%
‘Profit before tax’ is considered one of the financial targets in setting the STI.
Dividends, changes in share price, and return of capital are included in the total shareholder return (TSR) calculation which is one of the
performance criteria assessed for the LTI. The other performance criteria assessed for the LTI is growth in earnings per share, which takes
into account the Group’s net profit.
The overall level of key management personnel’s remuneration takes into account the performance of the Group over a number of years.
Directors
The base Directors fees for Non-executive Directors, last voted upon by the shareholders at the November 2013 AGM, is not to exceed $360,000
per annum in total. Non-executive Directors base fees (excluding Committee Fees) are presently $161,786 per annum.
4.3.2 Directors’ and Executive Officers’ Remuneration
Details of the nature and amount of each major element of remuneration of each Director and key management personnel of the Company are:
Short-Term
Post - Employment
For the year ended
30 June 2024
Directors Fees
and Committee
Fees
$
Salary
$
STI Cash
Bonus (A)
$
Non
Monetary
Benefits
$
Total
$
Superannuation
$
Other
Long
Term
$
Total
$
Executive Directors
Mr John Chan, Executive
Chairman
-
454,269
260,192
-
714,461
27,500
7,753
749,714
Mr Darren John Pateman,
Managing Director
-
727,821
260,192
-
988,013
27,399
12,381
1,027,793
Mr Ronald Chan, Chief
Operating Officer
-
403,844
130,096
-
533,940
27,399
6,573
567,912
Non-executive Directors
Mr Terence Siong Woon Peh
82,270
-
-
-
82,270
-
-
82,270
Mr Lee Verios*
22,216
-
-
-
22,216
2,333
-
24,549
Mr Eldon Wan
78,988
-
-
-
78,988
-
-
78,988
Executives
Mr Edward Guy Bank, Chief
Financial Officer
-
314,576
130,096
-
444,672
27,399
5,070
477,141
183,474 1,900,510
780,576
- 2,864,560
112,030
31,777
3,008,367
* Lee Verios retired on 18 October 2023.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
53
4. Corporate Governance Statement (continued)
4.3 Remuneration Report - Audited (continued)
4.3.2 Directors’ and Executive Officers’ Remuneration (continued)
Short-Term
Post - Employment
For the year ended
30 June 2023
Directors Fees
and Committee
Fees
$
Salary
$
STI Cash
Bonus (A)
$
Non
Monetary
Benefits
$
Total
$
Superannuation
$
Other
Long
Term
$
Total
$
Executive Directors
Mr John Chan, Executive
Chairman
-
550,124
44,795
-
594,919
27,500
(3,535)
618,884
Mr Darren John Pateman,
Managing Director
-
726,846
44,795
7,852
779,493
25,292
12,441
817,226
Mr Ronald Chan, Chief
Operating Officer
-
404,330
22,398
-
426,728
25,292
6,707
458,727
Non-executive Directors
Mr Kee Kong Loh**
41,574
-
-
-
41,574
-
-
41,574
Mr Terence Siong Woon Peh
82,270
-
-
-
82,270
-
-
82,270
Mr Lee Verios
74,452
-
-
-
74,452
7,818
-
82,270
Mr Eldon Wan**
29,696
-
-
-
29,696
-
-
29,696
Executives
Mr Edward Guy Bank, Chief
Financial Officer
-
315,141
22,398
-
337,539
25,292
5,199
368,030
227,992 1,996,441
134,386
7,852 2,366,671
111,194
20,812
2,498,677
** Kee Kong Loh retired on 31 January 2023. Eldon Wan was appointed on 31 January 2023.
Notes in relation to the Table of Directors’ and Executive Officers’ Remuneration - Audited
(A) Short-term Incentive Cash Bonus:
The short-term incentive bonus is for performance during the respective financial years using the criteria set out on Page 51.
Details of the Group’s policy in relation to the remuneration that is performance related is discussed on Page 51.
On 13th September 2017, Finbar Group Limited issued 250,000 fully paid ordinary shares to Darren Pateman as Director Incentive Shares
under the rules of the Director Share Plan 2014. Payment was by way of an interest free loan of $202,500 which was repaid in September 2022.
The related non-monetary benefit is disclosed in table 4.3.2 on page 53.
4.3.3 Analysis of Bonuses included in Remuneration
Details of the vesting profile of the short term incentive bonuses awarded as remuneration to each Director and key management personnel of
the Company are detailed below.
Short Term Incentive Bonus
Included in
Remuneration
$
% vested in year
Executive Directors
Mr John Chan
260,192
100%
Mr Darren John Pateman
260,192
100%
Mr Ronald Chan
130,096
100%
Executives
Mr Edward Guy Bank
130,096
100%
780,576
100%
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
54
4. Corporate Governance Statement (continued)
4.3 Remuneration Report - Audited (continued)
4.3.3 Analysis of Bonuses included in Remuneration (continued)
Amounts included in remuneration for the financial year represent the amount of entitlements in the financial year based on achievement
of personal goals and satisfaction of performance criteria, as per Short Term Incentives (page 51). No discretionary bonus was paid to the
Executives in the 2024 financial year (2023: NIL). Any discretionary amounts of executive bonuses relating to 2024 financial year are yet to be
determined, and therefore may impact future financial years.
4.3.4 Directors’ and Executives Interests
Movement in Shares
The movement during the reporting period in the number of ordinary shares in Finbar Group Limited held, directly, indirectly or beneficially,
by each key management person, including their related parties, is as follows:
Held at
1 July 2023
Purchases
Sales/Retired
Held at
30 June 2024
Directors
Mr John Chan*
30,556,452
423,357
-
30,979,809
Mr Darren John Pateman**
3,662,493
-
-
3,662,493
Mr Ronald Chan***
21,487,554
373,357
-
21,860,911
Mr Terence Siong Woon Peh****
68,550,866
-
-
68,550,866
Mr Lee Verios (Retired on 18 October 2023)
72,393
-
(72,393)
-
Mr Eldon Wan
-
-
-
-
Executives
Mr Edward Guy Bank
300,000
-
-
300,000
Held at
1 July 2022
Purchases
Sales/Retired
Held at
30 June 2023
Directors
Mr John Chan*
28,568,265
1,988,187
-
30,556,452
Mr Darren John Pateman**
3,632,493
30,000
-
3,662,493
Mr Ronald Chan***
18,894,133
2,593,421
-
21,487,554
Mr Kee Kong Loh (Retired on 31 January 2023)
2,000,904
-
(2,000,904)
-
Mr Terence Siong Woon Peh****
60,431,843
8,119,023
-
68,550,866
Mr Lee Verios
72,393
-
-
72,393
Mr Eldon Wan (Appointed on 31 January 2023)
-
-
-
-
Executives
Mr Edward Guy Bank
300,000
-
-
300,000
* John Chan has interests in Forward International Pty Ltd, Apex Investments Pty Ltd and Blair Park Pty Ltd which hold shares in Finbar Group
Limited.
** Darren John Pateman has interest in Pateman Equity Pty Ltd which holds shares in Finbar Group Limited.
*** Ronald Chan has interests in Forward International Pty Ltd and Blair Park Pty Ltd which hold shares in Finbar Group Limited.
**** Terence Peh is a Director and shareholder of Chuan Hup Holdings Limited which holds shares in Finbar Group Limited.
No options or rights for shares were granted to key management personnel as remuneration during the reporting period.
4.3.5 Equity Instruments
All options refer to options over ordinary shares of Finbar Group Limited issued under the Employee Incentive Plan 2013 or the Director Share
Plan 2014. As at 30 June 2024, there were no options or rights on issue.
End of Audited Remuneration Report.
4.4 Audit Committee
The Audit Committee Charter sets out the Audit Committee’s role, powers and duties, and establishes the functions delegated to the Audit
Committee by the Board. The Audit Committee advises on the establishment and maintenance of a framework of internal control and
appropriate ethical standards for the management of the Group.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
55
4. Corporate Governance Statement (continued)
4.4 Audit Committee (continued)
A copy of the Audit Committee Charter is available on Finbar’s website www.finbar.com.au.
The following directors serve on the Audit Committee:
• Eldon WAN (Chairman) - Non-executive Director (Appointed on 18 October 2023)
• Terence Siong Woon PEH - Non-executive Director
• John CHAN - Executive Director
• Lee VERIOS (Chairman) - Non-executive Independent Director (Retired 18 October 2023)
4.5 Risk Management
Oversight of the Risk Management Procedures
The Board has elected not to establish a separate Risk Committee to oversee risk management and instead the overall responsibility of risk
management resides with the Board in its entirety. In this regard, risk management considerations form part of the Board’s discussions at
scheduled meetings.
The Board oversees the establishment, implementation, and annual review of the Group’s risk management procedures. Management has
established and implemented informal risk management procedures for assessing, monitoring and managing all risks including operational,
financial reporting and compliance risks for the Group. The Managing Director and Chief Financial Officer provide assurance, in writing to the
Board, that the financial risk management and associated compliance and controls have been assessed and found to be operating effectively.
Risk Management and Compliance Control
Comprehensive practices have been established to ensure:
• capital expenditure with respect to land acquisitions or development agreements obtain prior Board approval;
• financial exposures are controlled. Further details of the Group’s policies relating to interest rates management and credit risk are
included in Notes 5 and 24 in the Notes to the Consolidated Financial Statements;
• management systems are monitored and reviewed to achieve high standards of performance and compliance with regulations;
• business transactions are properly authorised and executed;
• the quality and integrity of personnel (see below);
• financial reporting accuracy and compliance with the financial reporting regulatory framework (see below); and
• environmental regulation compliance (see below).
Quality and Integrity of Personnel
Training and development and appropriate remuneration and incentives with regular performance reviews create an environment of
cooperation and constructive dialogue with employees and senior management.
Financial Reporting
The Managing Director and the Chief Financial Officer have provided assurance, in writing, to the Board that the Group’s financial reports are
founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the Board.
There is a comprehensive accounting system. Monthly actual results are reported against budgets approved by the Directors and revised
forecasts for the year are prepared regularly. Procedures are in place to ensure price sensitive information is reported to the Australian
Securities Exchange (ASX) in accordance with Continuous Disclosure Requirements.
A review is undertaken at each half year end on all related party transactions.
Environmental Regulation
The Group’s operations are not subject to any significant environmental regulations under either Commonwealth or State legislation.
Compliance with the requirements of environmental regulations and site environmental licences were substantially achieved across all
operations with no instances of non-compliance in relation to licence requirements noted.
The Board is not aware of any significant breaches of environmental regulations during the period.
4.6 Ethical Standards
All Directors, Managers and Employees are expected to act with the utmost integrity and objectivity, striving at all times to enhance the
reputation and performance of the Group.
Conflict of Interest
Directors must keep the Board advised, on an ongoing basis, of any interest that could potentially conflict with those of the Group.
Where the Board believes that a significant conflict exists for a Director on a Board matter, the Director concerned does not receive the
relevant Board papers and is not present at the meeting whilst the item is considered. Details of Director related entity transactions with the
Company and the Group are set out in Note 28 in the Notes to the Consolidated Financial Statements.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
56
4. Corporate Governance Statement (continued)
4.6 Ethical Standards (continued)
Code of Conduct
All Directors, Managers and Employees are expected to maintain high ethical standards including the following:
• aligning the behaviour of the Board and Management with the code of conduct by maintaining appropriate core Group values and
objectives;
• fulfilling responsibilities to shareholders by delivering shareholder value;
• usefulness of financial information by maintaining appropriate accounting policies, practices and disclosure;
• fulfilling responsibilities to clients, customers and consumers by maintaining high standards of product quality, service standards,
commitments to fair value, and safety of goods produced;
• employment practices such as occupational health and safety, employment opportunity, training and education support, community
activities, sponsorships and donations;
• responsibilities to the individual, such as privacy, use of privileged or confidential information, and conflict resolution;
• managing actual or potential conflicts of interest;
• corporate opportunities such as preventing Directors and key executives from taking advantage of property, information or position for
personal gain;
• confidentiality of corporate information;
• fair dealing;
• protection and proper use of the Group’s assets;
• compliance with laws; and
• reporting unlawful or unethical behaviour including protection of those who report violations in good faith.
Trading in General Company Securities by Directors and Employees
The key elements of the Trading in Company Securities by Directors and Employees policy are:
• identification of those restricted from trading - Directors and Senior Executives may acquire shares in the Company, but are prohibited
from dealing in Company shares or exercising options:
- within two trading days after either the release of the Company’s half-year and annual results to the Australian Securities Exchange
(‘ASX’), the Annual General Meeting or any major announcement;
- whilst in possession of price sensitive information not yet released to the market;
• raising the awareness of legal prohibitions including transactions with colleagues and external advisers;
• raising awareness that the Company prohibits those restricted from trading in Company shares as described above from entering into
transactions such as margin loans that could trigger a trade during a prohibited period; and
• requiring details to be provided of the trading activities of the Directors of the Company.
4.7 Communication with Shareholders
The Board is committed to ensuring that the Company complies with its continuous disclosure obligations and to facilitate this, has approved
a Continuous Disclosure Policy that applies to all Group personnel, including the Directors and Senior Executives. The Board seeks to promote
investor confidence by seeking to ensure that trading in the Company’s shares take place in an informed market.
Finbar provides information about itself, its activities and operations, and its governance via its website www.finbar.com.au.
4.8 Diversity
The Board has considered the recommendation to formulate strict measurable targets for the purposes of the assessment of gender diversity
within the organisation. Given the small size and relatively stable nature of its workforce it has formed the view that at this time it would
not be appropriate or practical to establish a written policy regarding gender diversity. The Board will review this position at least annually.
However, generally, when selecting new employees or advancing existing employees, no consideration is given to gender, age or ethnicity, but
instead selections are based upon individuals achievements, skill and expertise.
2024
2023
Gender representation
Female
Male
Female
Male
Board
0%
100%
0%
100%
Key Management Personnel
0%
100%
0%
100%
Senior Management
50%
50%
50%
50%
Group
58%
42%
56%
44%
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
57
5. Principal Activities
The principal activities of the Group during the course of the financial year continued to be property development and investment.
The Group’s focus is the development of medium to high-density residential buildings and commercial developments in Western Australia
by way of direct ownership, ownership through fully owned Subsidiaries or by equity accounted investees (through companies registered
specifically to conduct the development).
The Group holds rental property in East Perth, South Perth and Karratha.
There were no significant changes in the nature of the activities of the Group during the financial year.
6. Operating and Financial Review
2024
2023
2022
2021
2020
Total comprehensive income attributable
to Owners of the Group
$16,427,000
$2,782,000
$10,975,000
$8,863,000
$7,068,000
Basic and Diluted EPS
$0.06
$0.01
$0.04
$0.03
$0.02
Dividends paid
$0
$5,442,000
$10,884,000
$8,163,000
$13,606,000
Dividends paid per share
$0.00
$0.02
$0.04
$0.03
$0.05
Market price per share
$0.84
$0.66
$0.68
$0.85
$0.70
Change in share price
$0.18
-$0.02
-$0.17
$0.15
-$0.14
Return on capital employed attributable
to Owners of the Group
8.49%
1.84%
5.06%
3.82%
4.47%
Return on total equity attributable to
Owners of the Group
6.40%
1.16%
4.52%
3.65%
2.92%
No dividends were paid in 2024.
Key transactions that contributed to the consolidated net profit of the Company for the 2024 financial year were the completion of Civic
Heart Apartments, sales and settlements of completed stock held at 30 June 2023 and the ongoing rental of the Company’s commercial and
residential properties. See below for further information on the Company’s project completions and overview.
Review of Operations
Finbar Group Limited’s (‘Finbar’ or ‘the Company’) core business lies in the development of medium to high density residential apartments and
commercial property within the state of Western Australia. Finbar carries out its development projects through wholly owned subsidiaries,
development agreements with landowners or incorporated entities, and equity accounted investees. Development arrangements and equity
partners are sought to allow the Company to leverage into larger development projects to take advantage of the benefits of economies of
scale, to help spread project risk, and to leverage the Company’s intellectual property.
The Company operates predominantly within the central suburbs of the Perth metropolitan area. The ability to source new viable development
opportunities and develop product that meets the needs of an evolving residential market is central to Finbar’s ongoing success. The Board
and Management has a long-proven track record of such success.
The administration of the Group along with the operating, investment and acquisitions decisions are made by Finbar’s Board and Management.
The Company employs 28 staff in its corporate offices in East Perth, Western Australia and 1 staff in the regional Karratha office.
The Company’s Management has remained diligent in ensuring a strong balance sheet is maintained to protect and improve the Company’s
market position through market cycles. The Company completed Civic Heart Apartments in South Perth during the financial year. Focusing
on its main principal activity into the next financial year, construction continues to progress at Aurora in Applecross, The Point in Rivervale
and Garden Towers East Perth in East Perth. The building and completion of the projects will further strengthen the Company’s financial and
operating position, generating revenue, and building cash flows to fund future opportunities and the payment of dividends to shareholders.
There were no significant changes in the composition of overall assets and liabilities, with movements in assets from non-current to current
and movements in liabilities from non-current to current as projects reach completion. The Company continued to focus on the generation of
property sales and rental revenue through property development and investment.
Material Business Risks
With multiple projects in the pipeline, current property shortages and supply constraints, the outlook of the Group is optimistic. Nonetheless,
the Group is exposed to various risk factors which could be business specific or generally macroeconomic. The Group’s operational structure
and unique business relationship arrangements mitigates the inherent risk of the business.
Supply chain and cost control risk – Building and architectural costs are the key development costs of a project. Finbar outsources its design
and construction activities to long-standing external parties. The stable affiliation and adequate project contingencies help cushion project
margins from significant price fluctuations, milestone delays, and contract default risk by key providers. This outsourcing model ensures
that the Company is and remains scalable, efficient and agile in a market where acquisition and project timing is critical in maintaining a
competitive advantage.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
58
6. Operating and Financial Review (continued)
Material Business Risks (continued)
Funding and interest rates risk – As property development requires a large initial capital outlay before property settlement, restricted access
to funds will limit and affect the Company’s ability to pursue new opportunities and to deliver projects in a timely manner. The Company
addresses this as follows:
• Depending on the development arrangement, we have access to capital from equity accounted investees partners and landowners;
• Construction does not commence until sufficient pre-sales are achieved to prove up project viability and provide comfort to project
financiers;
• Where financing criteria is met, development funding from major Australian banks over the specific project is utilised; and
• Land acquisitions and associated holding costs are funded without the use of external debt funding.
Valuation of property – The value of land, building, and investment properties may be affected by a wide range of factors which are beyond
of the Company’s control. The effect may be adverse on the overall business result due to impact on net realisable value of inventory,
selling price, compliance on lending covenants and ultimately the liquidity of the Group. The Board and Management continuously monitor
market fluctuations and conditions and implement appropriate strategies to benefit from and insulate the Company against changing market
conditions.
Additionally, changes in government legislation, regulation, rebates, and incentives may impact the Company’s operations. Management
mitigates regulatory risks through constant monitoring, providing appropriate staff training, maintaining relationships with regulatory bodies,
and actively engaging with industry groups conducting property related advocacy work in the Company’s sector.
The Board and Management do not currently have the view that there is a requirement to reposition the Company’s overall business model.
Completed Projects
Dianella Apartments - 36 Chester Avenue, Dianella: 1 residential unit has settled in the reporting period. The 128 unit development is now
fully settled.
Reva - 5 Harper Terrace, South Perth: 1 commercial unit settled in the reporting period. 3 commercial units remain for sale in the 59 unit
development.
AT238 - 238 Adelaide Terrace, Perth: 34 units have settled in the reporting period and 3 units settled post the reporting period. 15 units remain
for sale in the 121 unit development.
Civic Heart - 1 Mends Street, South Perth: Construction of the Civic Heart project completed in the second half of the financial year. 194 units
have settled in the reporting period and 50 units settled post the reporting period. 55 units remain for sale in the 334 unit development.
Currently Under Construction
Aurora Applecross - 3 Kintail Road, Applecross (Stage 2): Construction works continue to progress, with completion expected during the
financial year ending 30 June 2025. To date 70 residential sales have been achieved in the development of 118 residential and 3 commercial
units.
The Point - 31 Rowe Avenue, Rivervale: Construction works continue to progress, with completion expected during the financial year ending 30
June 2025. To date 143 residential sales and 2 commercial sales have been achieved in the development of 167 residential and 9 commercial
units.
Garden Towers East Perth - 101 Hay Street, East Perth: Marketing of the Garden Towers project continues to progress well, with construction
commenced in April 2024 and completion expected during financial year ending 30 June 2027. To date 217 residential sales and 6 commercial
sales have been achieved in the development of 331 residential and 13 commercial units.
Future Projects
Bel-Air Apartments - 239 Great Eastern Highway, Belmont: Marketing of the Bel-Air project continues to progress, with construction expected
to commence in the financial year ending 30 June 2025. To date 110 residential sales and 2 commercial sale have been achieved in the
development of 194 residential and 2 commercial units.
Romeo - 912 Canning Highway, Applecross (Stage 3): Development approval in place for 152 residential and 3 commercial units.
Palmyra West Apartments - 43 McGregor Road, Palmyra (Stage 2): Development approval in place for 130 residential units.
Lot 1000 - 32 Riversdale Road, Rivervale: Development approval in place for 143 residential units.
Lot 888 - 2 Hawksburn Road, Rivervale: Development options are currently being explored.
2 Homelea Court, Rivervale: Development options are currently being explored.
Former ABC Studio - 187 Adelaide Terrace, East Perth: Development options are currently being explored.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
59
6. Operating and Financial Review (continued)
Investment Property
Fairlanes - 181 Adelaide Terrace, East Perth: The Fairlanes property has been revalued during the reporting period. The valuation resulted in
a $1,248,000 decrease to the value of the property. The company continues to benefit from the investment income generated from the leased
property. The property is currently 56% leased. The company continues to actively market the remaining tenancies for rental.
Pelago Commercial - 23 & 26 Sharpe Avenue, Karratha: The Pelago commercial property has been revalued during the reporting period.
The valuation resulted in a $145,000 decrease to the value of the property. The company continues to benefit from the investment income
generated from the leased property. The property is currently 66% leased. The company continues to actively market the remaining tenancies
for rental.
Pelago Residential - 23 & 26 Sharpe Avenue, Karratha: The Pelago residential property has been revalued during the reporting period.
The valuation resulted in a $5,020,000 increase to the value of the property. The company continues to benefit from the investment income
generated from the leased property. The property is currently 89% leased. The company continues to actively market tenancies for rental as
they become available.
Vue Tower Commercial - 63 Adelaide Terrace, East Perth: Lot 2 at Vue Tower is being marketed for rental. Lot 4 at Vue Tower continues to be
leased to a non-profit organisation at $1 per annum until 13 June 2029.
Aurelia Commercial - 96 Mill Point Road, South Perth: Lots 133, 135-138 at Aurelia were revalued during the period. The valuation resulted
in $220,000 increase to the value of the property. Lots 135,136 and 137 are currently being leased. The company is actively marketing the
remaining tenancies for rental.
Significant Changes in State of Affairs
Other than set out in this report, in the opinion of the Directors there were no significant changes in the state of affairs of the Group that
occurred during the financial year.
7. Dividends
Proposed Dividend
After the balance date the following dividend has been proposed by the Directors to members. The dividend has not been provided for and
there are no income tax consequences.
Cents per Share
Total Amount
$’000
Franked /
Unfranked
Date of Payment
Final 2024 ordinary
8.00
21,770
Franked
10 October 2024
Total Dividends Proposed
21,770
The financial effect of this dividend has not been brought to account in the financial statements for the year ended 30 June 2024 and will be
recognised in subsequent financial reports.
Dividend Reinvestment Plan
In accordance with Rule 13 of the Company’s Dividend Reinvestment Plan (DRP), the Directors have elected to suspend the DRP in the 2024
financial year until further notice.
8. Events Subsequent to Reporting Date
There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material
and unusual nature likely, in the opinion of the Directors of the Company, to affect significantly the operations of the Group, the results of those
operations, or the state of affairs of the Group in future financial years.
9. Likely Developments
The Group will continue to pursue its policy of increasing the profitability and market share of its major business sectors during the next
financial year.
The Group will continue planned development projects on existing land and will continue to assess new development opportunities through
acquisition of land for future development.
Further information about likely developments in the operations of the Group and the expected results of these operations in future years have
not been included in this report as the disclosure of such information would, in the opinion of the Directors, be likely to result in unreasonable
prejudice to the Group.
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
60
10. Directors’ Interests
The relevant interest of each Director in the shares and options over such instruments by the companies within the Group, as notified by the
Directors to the Australian Stock Exchange Limited in accordance with S205G(1) of the Corporations Act 2001, as at the date of this report is as
follows:
Director
Ordinary Shares
Mr John Chan
30,979,809
Mr Darren John Pateman
3,662,493
Mr Ronald Chan
21,860,911
Mr Terence Siong Woon Peh
68,550,866
Mr Eldon Wan
-
11. Indemnification and Insurance of Officers
Indemnification
The Company has agreed to indemnify the current Directors of the Company, its subsidiaries and equity accounted investees, against all
liabilities to another person (other than the Company or related body corporate) that may arise from their position as Directors of the
Company, its subsidiaries and equity accounted investees, except where the liability arises out of the conduct involving lack of good faith.
The Company has not provided any insurance or indemnity to the auditor of the Company.
Insurance Premiums
During the financial year the Company has paid insurance premiums of $95,000 (2023: $86,000) in respect of Directors and Officers liability and
legal expenses insurance contracts for Directors and Officers, including Executive Officers of the Company. The insurance premiums relate to:
• Costs and expenses incurred by the relevant Officers in defending proceedings, whether civil or criminal and whatever their outcome; and
• Other liabilities that may arise from their position, with the exception of conduct involving a wilful breach of duty or improper use of
information or position to gain a personal advantage.
12. Non-audit Services
During the year KPMG, the Group’s auditor, has performed certain other services in addition to their statutory duties.
The Board has considered the non-audit services provided during the year by the auditor and is satisfied that the provision of those non-
audit services during the year by the auditor is compatible with, and did not compromise, the auditors independence requirements of the
Corporations Act 2001 for the following reasons:
• all non-audit services were subject to the corporate governance procedures adopted by the Group and have been reviewed to ensure they
do not impact 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, as they did not involve reviewing or auditing the auditor’s own work, acting in a management or
decision making capacity for the Group, acting as an advocate for the Group or jointly sharing risks and rewards.
Details of the amounts paid to the auditor of the Group, KPMG, and its related practices for audit and non-audit services provided during the
year are set out below:
Consolidated
2024
$
2023
$
Audit Services:
Auditors of the Company
Audit and review of financial statements of the Group - KPMG
189,824
181,778
Audit and review of financial statements of Subsidiaries - KPMG
14,000
-
203,824
181,778
Services Other Than Statutory Audit:
Taxation advice and tax compliance services - KPMG
26,888
21,527
26,888
21,527
DIRECTORS’ REPORT (Continued)
For the Year Ended 30 June 2024
2024 Finbar Group Limited Annual Report
61
13. Lead Auditor’s Independence Declaration
The Lead Auditor’s Independence Declaration is set out on Page 103 and forms part of the Directors’ Report for the financial year ended
30 June 2024.
Signed in accordance with a resolution of the Board of Directors:
Darren Pateman
Managing Director
Dated at Perth this Twentieth day of August 2024.
Consolidated
Note
2024
$’000
2023
$’000
Revenue
7
194,344
33,965
Cost of sales
(161,266)
(19,022)
Gross Profit
33,078
14,943
Other income
8
2,937
226
Administrative expenses
(9,254)
(7,283)
Advertising expenses
(395)
(152)
Revaluation increase/(decrease) of investment property
3,847
(243)
Revaluation increase of property, plant and equipment
230
151
Rental expenses
(3,955)
(3,671)
(Loss)/Gain on disposal of investment properties
(222)
491
Results from Operating Activities
26,266
4,462
Finance income
10
1,104
945
Finance costs
10
(3,205)
(2,239)
Net Finance Costs
(2,101)
(1,294)
Share of (loss)/profit of equity accounted investees (net of income tax)
14
(163)
780
Profit before Income Tax
24,002
3,948
Income tax expense
11
(7,399)
(813)
Profit for the year
16,603
3,135
Other comprehensive income
Items which will not be reclassified to profit or loss:
Revaluation decrease of property, plant and equipment
(252)
(504)
Tax on items that will not be reclassified to profit or loss
11
76
151
Other comprehensive loss for the year, net of income tax
(176)
(353)
Total comprehensive income for the year
16,427
2,782
Earnings per Share:
Basic earnings per share (cents per share)
20
6.10
1.15
Diluted earnings per share (cents per share)
20
6.10
1.15
The Consolidated Statement of Profit or Loss and Other Comprehensive Income is to be read in conjunction with the Notes to the Financial
Statements set out on Pages 66 to 95.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the Year Ended 30 June 2024
62
2024 Finbar Group Limited Annual Report
Note
Share Capital
$’000
Retained
Earnings
$’000
Asset
Revaluation
Reserve
$’000
Total Equity
$’000
Balance as at 1 July 2022
194,484
47,719
529
242,732
Total comprehensive income for the year
Profit
-
3,135
-
3,135
Other comprehensive loss
-
-
(353)
(353)
Transactions with owners, recognised directly in equity
Dividends to shareholders
19
-
(5,442)
-
(5,442)
Balance as at 30 June 2023
194,484
45,412
176
240,072
Balance as at 1 July 2023
194,484
45,412
176
240,072
Total comprehensive income for the year
Profit
-
16,603
-
16,603
Other comprehensive loss
-
-
(176)
(176)
Transactions with owners, recognised directly in equity
Dividends to shareholders
19
-
-
-
-
Balance as at 30 June 2024
194,484
62,015
-
256,499
Amounts are stated net of tax
The Consolidated Statement of Changes in Equity is to be read in conjunction with the Notes to the Financial Statements set out on Pages
66 to 95.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the Year Ended 30 June 2024
63
2024 Finbar Group Limited Annual Report
Consolidated
Note
2024
$’000
2023
$’000
Current Assets
Cash and cash equivalents
18a
220,138
18,176
Trade and other receivables
17
21,465
20,486
Inventories
16
304,960
145,883
Investment property
12
-
2,050
Prepayments
334
716
Investments in equity accounted investees
14
8
2
Other assets
48
51
Total Current Assets
546,953
187,364
Non-current Assets
Trade and other receivables
17
11,875
19,917
Inventories
16
26,806
114,878
Investment property
12
102,316
98,902
Prepayments
-
115
Investments in equity accounted investees
14
1,595
1,767
Property, plant and equipment
13
9,176
9,486
Deferred tax assets
15
5,725
8,053
Other assets
88
83
Total Non-current Assets
157,581
253,201
Total Assets
704,534
440,565
Current Liabilities
Trade and other payables
23
48,973
15,086
Loans and borrowings
21
346,447
162,337
Current tax payable
15
2,554
1,882
Employee benefits
22
899
807
Total Current Liabilities
398,873
180,112
Non-current Liabilities
Trade and other payables
23
-
257
Loans and borrowings
21
42,319
14,803
Deferred tax liabilities
15
6,793
5,310
Employee benefits
22
50
11
Total Non-current Liabilities
49,162
20,381
Total Liabilities
448,035
200,493
Net Assets
256,499
240,072
EQUITY
Share capital
19
194,484
194,484
Retained earnings
62,015
45,412
Reserves
19
-
176
Total Equity
256,499
240,072
The Consolidated Statement of Financial Position is to be read in conjunction with the Notes to the Financial Statements set out on Pages
66 to 95.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2024
64
2024 Finbar Group Limited Annual Report
Consolidated
Note
2024
$’000
2023
$’000
Cash Flows from Operating Activities
Cash receipts from customers
226,401
76,994
Cash paid to suppliers and employees
(229,535)
(186,127)
Cash used in Operating Activities before tax and interest paid
(3,134)
(109,133)
Interest paid
(10,342)
(1,738)
Income tax paid
(2,841)
(2,788)
Net Cash used in Operating Activities
18b
(16,317)
(113,659)
Cash Flows from Investing Activities
Proceeds from sale of investment properties
2,365
3,238
Interest received
1,186
483
Dividends received from equity accounted investees
4
590
Acquisition of property, plant and equipment
13
(168)
(206)
Proceeds from sale of property, plant and equipment
13
14
-
Acquisition of investment property
-
(716)
Repayment of loans to related party
-
(2,136)
Loans to equity accounted investees
(3,721)
(5,555)
Proceeds from loans to equity accounted investees
6,935
16,488
Net Cash provided by Investing Activities
6,615
12,186
Cash Flows from Financing Activities
Proceeds from borrowings
21
214,250
100,739
Repayment of borrowings
21
(2,586)
(8,850)
Dividends paid
19
-
(5,442)
Net Cash provided by Financing Activities
211,664
86,447
Net increase/(decreased) in cash and cash equivalents
201,962
(15,026)
Cash and cash equivalents at 1 July
18,176
33,202
Cash and Cash Equivalents at 30 June
18a
220,138
18,176
The Consolidated Statement of Cash Flows is to be read in conjunction with the Notes to the Financial Statements set out on Pages 66 to 95.
CONSOLIDATED STATEMENT OF CASH FLOWS
For the Year Ended 30 June 2024
65
2024 Finbar Group Limited Annual Report
Index to Notes to the Financial Statements
Note
Page
Note
Page
1. Reporting Entity
68
17. Trade and Other Receivables
85
2. Basis of Preparation
68
18. Cash and Cash Equivalents
86
3. Material Accounting Policies
69
19. Capital and Reserves
86
4. Determination of Fair Values
74
20. Earnings per Share
88
5. Financial Risk Management
75
21. Loans and Borrowings
88
6. Operating Segments
76
22. Employee Benefits
89
7. Revenue
79
23. Trade and Other Payables
90
8. Other Income
79
24. Financial Instruments
90
9. Personnel Expenses
79
25. Operating Leases
92
10. Finance Income and Finance Costs
79
26. Capital and Other Commitments
92
11. Income Tax Expense
80
27. Contingencies
93
12. Investment Property
80
28. Related Parties
93
13. Property, Plant and Equipment
82
29. Group Entities
94
14. Investments in Equity Accounted Investees
84
30. Subsequent Events
95
15. Tax Assets and Liabilities
85
31. Auditor's Remuneration
95
16. Inventories
85
32. Parent Entity Disclosures
95
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the Year Ended 30 June 2024
66
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
Index to Material Accounting Policies (Note 3)
Note
Page
(a) Basis of Consolidation
69
(b) Financial Instruments
69
(c) Property, Plant and Equipment
70
(d) Investment Property
71
(e) Inventories
71
(f) Impairment
71
(g) Employee Benefits
72
(h) Provisions
72
(i) Revenue
72
(j) Finance Income and Finance Costs
73
(k) Income Tax
73
(l) Goods and Services Tax
73
(m) Earnings per Share
74
(n) Segment Reporting
74
(o) New Standards and Interpretations
74
67
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
1. Reporting Entity
Finbar Group Limited (‘the Company’) is a public company domiciled in Australia. The address of the Company’s registered office is Level 6, 181
Adelaide Terrace, East Perth WA 6004. The consolidated financial statements of the Group as at and for the year ended 30 June 2024 comprise
the Company, its Subsidiaries (together referred to as ‘the Group’ and individually as ‘Group entities’) and the Group’s interest in equity
accounted investees. The Group is a for-profit entity and is primarily involved in residential property development and property investment
(see Note 6).
2. Basis of Preparation
(a) Statement of Compliance
The consolidated financial statements are general purpose financial statements which have been prepared in accordance with Australian
Accounting Standards (AASBs) adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act 2001. These
consolidated financial statements of the Group comply with International Financial Reporting Standards (IFRSs) and interpretations adopted by
the International Accounting Standards Board (IASB).
The consolidated financial statements were approved by the Board of Directors on 20th August 2024.
(b) Basis of Measurement
The consolidated financial statements have been prepared on the historical cost basis except for the following:
• financial instruments recognised through profit or loss are measured at fair value;
• investment property is measured at fair value; and
• property under property, plant and equipment is measured at fair value.
The methods used to measure fair values are discussed further in Note 4.
(c) Functional and Presentation Currency
These consolidated financial statements are presented in Australian dollars which is the functional currency for the Group. In accordance with
ASIC Corporations (Rounding in Financial/ Directors’ Reports) Instrument 2016/191, amounts in the consolidated financial statements and
directors’ report have been rounded off to the nearest thousand dollars, unless otherwise stated.
(d) Use of Estimates and Judgements
The preparation of consolidated financial statements in conformity with AASBs requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual
results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in
which the estimate is revised and in any future periods affected.
(i) Assumptions and estimation uncertainties
Information about assumptions made in measuring fair values and estimation uncertainties that have a significant risk of resulting in a
material adjustment within the year ending 30 June 2024 are included in the following notes:
• Note 12 - Valuation of investment property;
• Note 13 - Valuation of property, plant & equipment; and
• Note 16 - Valuation of inventory.
(ii) Measurement of fair values
A number of the Group’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets
and liabilities.
The Group has an established control framework with respect to the measurement of fair values. The Managing Director and Chief Financial
Officer have the overall responsibility for overseeing all significant fair value measurements, including Level 3 fair values.
Valuations are reported to the Audit Committee at each reporting date.
When measuring the fair value of an asset or a liability, the Group uses market observable data as far as possible. Fair values are categorised
into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or
indirectly (i.e. derived from prices)
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs)
If the inputs used to measure the fair value of an asset or a liability might be categorised in different levels of the fair value hierarchy, then the
fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to
the entire measurement.
The Group recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change occurred.
68
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
2. Basis of Preparation (continued)
(e) Changes in Accounting Policies
The Group’s accounting policies are consistent with those disclosed in the financial statements for the year ended 30 June 2023.
3. Material Accounting Policies
The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements, and
have been applied consistently by Group entities.
(a) Basis of Consolidation
(i) Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to or has rights to variable returns from its
investment with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries
are included in the consolidated financial statements from the date that control commences until the date that control ceases. The accounting
policies of subsidiaries are changed when necessary to align them with the policies adopted by the Group.
(ii) Equity Accounted Investees (Joint Ventures)
Equity accounted investees are those entities over whose activities the Group has joint control, established by contractual agreement and
requiring unanimous consent for strategic and operating decisions. Investments in equity accounted investees are accounted for using the
equity method and are initially recognised at cost. The consolidated financial statements include the Group’s share of the income and expenses
and equity movements of equity accounted investees, after adjustments to align the accounting policies with those of the Group, from the date
that the joint control commences until the date the joint control ceases. When the Group’s share of losses exceeds its interest in an equity
accounted investee, the carrying amount of that interest is reduced to nil and the recognition of further losses is discontinued except to the
extent that the Group has an obligation or has made payments on behalf of the equity accounted investee. Investments in equity accounted
investees are carried at the lower of the equity accounted amount and the recoverable amount.
(iii) Joint Operations
A joint operation is carried on by each venturer using its own assets in pursuit of the joint operations. The consolidated financial statements
include the assets that the Group controls and the liabilities that it incurs in the course of pursuing the joint operation, and the expenses that
the Group incurs and its share of the income that it earns from the joint operation.
(iv) Transactions Eliminated on Consolidation
Intra-group balances and transactions, and any unrealised gains and losses or income and expenses arising from intra-group transactions,
are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with equity accounted investees
are eliminated against the investment to the extent of the Group’s interest in the equity accounted investees. Unrealised losses are eliminated
in the same way as unrealised gains, but only to the extent that there is no evidence of impairment. Gains and losses are recognised as the
contributed assets are consumed or sold by the equity accounted investee or, if not consumed or sold by the equity accounted investee, when
the Group’s interest in such entities is disposed.
(b) Financial Instruments
(i) Non-derivative Financial Instruments
Non-derivative financial assets
Trade and other receivables and debt securities issued are initially recognised when they are originated. All other financial assets (including
assets designated at fair value through profit or loss – FVTPL) are initially recognised when the Group becomes a party to the contractual
provisions of the instrument.
A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:
• it is held within a business model whose objective is to hold assets to collect contractual cash flows; and
• its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount
outstanding.
The Group derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights
to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are
transferred or in which the Group neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain
control of the financial asset. Any interest in transferred financial assets that is created or retained by the Group is recognised as a separate
asset or liability.
Accounting for finance income and expense is discussed in Note 3(j).
69
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
3. Material Accounting Policies (continued)
(b) Financial Instruments (continued)
(i) Non-derivative Financial Instruments (continued)
Non-derivative financial liabilities
Trade and other payables, commercial bills and subordinated liabilities are initially recognised when they are originated at fair value plus
any directly attributable transaction costs. Subsequent to initial recognition these financial liabilities are measured at amortised cost using
the effective interest rate method. All other financial liabilities (including liabilities designated at fair value through profit or loss) are initially
recognised when the Group becomes a party to the contractual provisions of the instrument.
The Group derecognises a financial liability when its contractual obligations are discharged or cancelled or expire.
Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group
has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.
(ii) Share Capital
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share options are
recognised as a deduction from equity, net of any tax effects.
Repurchase of share capital
When share capital recognised in equity is repurchased, the amount of the consideration paid, which includes directly attributable costs, net of
any tax effects, is recognised as a deduction from equity.
Dividends
Dividends are recognised as a liability in the period in which they are declared.
(c) Property, Plant and Equipment
(i) Recognition and Measurement
Items of plant and equipment are measured at cost or deemed cost less accumulated depreciation and impairment losses.
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets include the cost
of materials, direct labour, any other costs directly attributable to bringing the asset to a working order for its intended use, the costs of
dismantling and removing the items and restoring the site on which they are located, and capitalised borrowing costs.
Items classified as property are measured at fair value. Refer Note 3(c)(iv).
Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major
components) of property, plant and equipment.
Gains on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying
amount of property, plant & equipment and are recognised net within “Other income” in profit or loss.
Losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying
amount of the property, plant & equipment item and are recognised net within “Administrative expenses” in profit or loss.
When revalued assets are sold, the amounts included in the revaluation reserve are transferred to retained earnings.
In respect to borrowing costs relating to qualifying assets, the Group capitalises costs directly attributable to the acquisition, construction or
production of a qualifying asset as part of the cost of the asset.
(ii) Reclassification to Investment Property
When the use of a property changes from owner-occupied to investment property, the property is remeasured to fair value and reclassified as
investment property. Any loss is recognised in the revaluation reserve to the extent that an amount is included in revaluation reserve for that
property, with any remaining loss recognised immediately in profit or loss. Any gain arising on revaluation is recognised in profit or loss to the
extent the gain reverses a previous impairment loss on the property, with any remaining gain recognised in a revaluation reserve in equity.
(iii) Subsequent Costs
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that
the future economic benefits embodied within the part will flow to the Group and its cost can be reliably measured. The carrying amount of
the replaced part is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as
incurred.
70
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
3. Material Accounting Policies (continued)
(c) Property, Plant and Equipment (continued)
(iv) Revaluation Model for Property
After recognition as an asset, the Group has elected to carry an item of property whose fair value can be reliably measured shall be carried
at a revalued amount, being its fair value at the date of the revaluation less any subsequent accumulated depreciation and accumulated
impairment losses. Revaluations are made with sufficient regularity to ensure that the carrying amount does not differ materially from that
which would be determined using fair value at the end of the reporting period.
If an item of property is revalued, the entire class of property to which that asset belongs shall be revalued. Any gain or loss arising on
remeasurement is recognised in other comprehensive income and asset revaluation reserve. Refer Note 4.
(v) Depreciation and Amortisation
Depreciation and amortisation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each part of an item of
property, plant and equipment. Assets are depreciated or amortised from the date of acquisition. Land is not depreciated.
The estimated useful lives in the current and comparative periods are as follows:
• Property
40 years
• Office furniture and equipment, fixtures and fittings
5 - 25 years
• Plant and equipment
1 - 10 years
Depreciation and amortisation rates and methods are reviewed at each reporting date. When changes are made, adjustments are reflected
prospectively in the current and future periods only.
(d) Investment Property
Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course
of business, used in the production or supply of goods and services or for administrative purposes. Investment property is measured at fair
value (see Note 4) with any change therein recognised in profit or loss.
Cost includes expenditure that is directly attributable to the acquisition of the investment property. The self-constructed investment property
transferred from inventory are recognised at fair value.
When the use of a property changes such that it is reclassified as property, plant or equipment, its fair value at the date of reclassification
becomes its cost for subsequent accounting.
(e) Inventories
Inventories and work in progress, including land held for resale, are stated at the lower of cost and net realisable value.
Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling
expenses.
Cost includes the cost of acquisition, development costs, holding costs and directly attributable interest on borrowed funds where the
development is a qualifying asset. When a development is completed and ceases to be a qualifying asset, borrowing costs and other costs are
expensed as incurred.
Property that is being constructed for future use as investment property is accounted for as inventory until construction or development is
complete, at which time it is remeasured to fair value and reclassified as investment property. Any gain or loss arising on remeasurement is
recognised in profit or loss.
Inventory is classified as current when it satisfies any of the following criteria:
• it is expected to be realised in, or is intended for sale or consumption in, the entity’s normal operating cycle;
• it is held primarily for the purpose of being traded; or
• it is expected to be realised within twelve months of the reporting date.
(f) Impairment
(i) Financial Assets
Under the expected credit losses (ECL) model in accordance with AASB 9 Financial Instruments, the Group calculates the allowance for credit
losses by considering on a discounted basis the cash shortfalls it would incur in various default scenarios for prescribed future periods and
multiplying the shortfalls by the probability of each scenario occurring. The allowance is the sum of these probability-weighted outcomes.
At each reporting period, the Group assess whether the credit risk on a financial instrument has increased significantly since initial recognition,
by analysing reasonable and supportable information that is available without undue cost or effort about past events, current conditions and
forecasts of future economic conditions.
Except for purchased and originated credit-impaired financial assets, trade receivables, AASB 15 contract assets and lease receivables, at each
reporting date:
• the Group measures the loss allowance for a financial instrument at an amount equal to the ‘lifetime expected credit losses’ if the credit
risk on that financial instrument has increased significantly since initial recognition; and
71
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
3. Material Accounting Policies (continued)
(f) Impairment (continued)
(i) Financial Assets (continued)
• if the credit risk on a financial instrument has not increased significantly since initial recognition, the Group measure the loss allowance
for that financial instrument at an amount equal to ‘12 month expected credit loss’.
The allowance and any changes in the expected credit loss are recognised as impairment gain and losses in profit or loss.
(ii) Non-financial Assets
The carrying amounts of the Group’s non-financial assets other than investment property, inventories and deferred tax assets, are reviewed
at each reporting date to determine whether there is any indication of impairment. If any such indication exists then the asset’s recoverable
amount is estimated.
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing
value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset. For the purpose of impairment testing, assets that cannot be tested
individually are grouped together into the smallest group of assets that generates cash flow from continuing use that are largely independent
of the cash flows of other assets or groups of assets (the “cash generating unit”).
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment
losses are recognised in profit or loss.
Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer
exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment
loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net
of depreciation or amortisation, if no impairment loss had been recognised.
(g) Employee Benefits
(i) Superannuation Contributions
Obligations for contributions to superannuation funds are recognised as an expense in profit or loss.
(ii) Long-term Employee Benefits
The Group’s obligation in respect of long-term service benefits is the amount of future benefit that employees have earned in return for their
service in the current and prior periods plus related on costs.
(iii) Termination Benefits
Termination benefits are recognised as an expense when the Group is demonstrably committed, without realistic possibility of withdrawal, to
a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an
offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies are recognised as an expense if the Group has
made an offer encouraging voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can be reliably
estimated.
(iv) Short-term Employee Benefits
Short term employee benefits are measured on an undiscounted basis and are expensed as the related service is provided.
A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has a present
legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be recognised
reliably.
(h) Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be reliably estimated, and
it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected
future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.
(i) Revenue
Under AASB 15 Revenue from Contracts with Customers, revenue is measured based on the consideration specified in a contract with a
customer and excludes amounts collected on behalf of third parties. The Group recognises revenue when it transfers control over a product or
service to a customer.
(i) Property Sales
Revenue from property sales include:
• sale of residential and commercial property;
• development costs fees which represent the fees charged to recoup project development costs from the landowners; and
• profit share fees which represent percentage profit sharing revenue based on net project profit.
72
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
3. Material Accounting Policies (continued)
(i) Revenue (continued)
(i) Property Sales (continued)
Revenue is recognised when control of the assets is transferred and the amount of revenue is measured based on the contracted amount. The
timing of transfer of control vary depending on the individual terms of the contract of sale.
For projects with an external landowner, when the Group is engaged as a property developer of the land, the Group is deemed to be acting as
the principal in the transaction and as such, property sales revenue and cost of sale are grossed up by the land cost base.
The cost of sales allocated to individual units is based on the estimated overall selling price for the project and is updated at each reporting date.
(ii) Supervision Fees
Supervision fees represents the management fees charged to the equity accounted investees. Revenue is recognised in profit or loss in
proportion to the stage of project completion which is by reference to an assessment of the costs incurred and the costs to be incurred.
Revenue is measured based on the contracted amount.
(iii) Management Fee
Management fees represents the management fee charged to the shareholders of equity accounted investees. Revenue is recognised in profit
or loss at property settlement and is measured based on the contracted amount.
Management fees include the fees earned by providing property management services exclusively to Finbar-built properties. Revenue is
recognised in profit or loss at the end of each month.
(iv) Rental Income
Rental income from investment property is recognised in profit or loss on a straight-line basis over the term of the lease in accordance with
AASB 16 Leases. Lease incentives granted are recognised as an integral part of the total rental income, over the term of the lease.
(j) Finance Income and Finance Costs
Finance income comprises interest income on funds invested, interest on loans to equity accounted investees, dividend income and changes
in the fair value of financial assets at fair value through profit or loss. Interest income is recognised as it accrues in profit or loss, using the
effective interest method. Dividend income is recognised in profit or loss on the date that the Group’s right to receive payment is established,
which in the case of quoted securities is the ex-dividend date.
Finance costs comprise interest expense on borrowings, changes in fair value of financial assets at fair value through profit or loss and
impairment losses recognised on financial assets. Borrowing costs that are not directly attributable to the acquisition or production of a
qualifying asset are recognised in profit or loss using the effective interest method.
(k) Income Tax
Income tax expense comprises current and deferred tax. Current and deferred tax are recognised in profit or loss except to the extent that it
relates to items recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the
reporting date, and any adjustment to tax payable in respect of previous years.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial
recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or
loss, and differences relating to investments in subsidiaries and equity accounted investees to the extent that it is probable that they will not
reverse in the foreseeable future. In addition, deferred tax is not recognised for taxable temporary differences arising on the initial recognition
of goodwill. Deferred tax is measured at the tax rates expected to be applied to the temporary differences when they reverse, based on the
laws enacted or substantively enacted by the reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets and they relate to
taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and
assets on a net basis or their tax assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable
that future taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at each reporting date and are
reduced to the extent that it is no longer probable that the related tax benefit will be realised.
Additional income tax expenses that arise from the distribution of dividends are recognised at the same time as the liability to pay the related
dividend is recognised. The Group does not distribute non-cash assets as dividends to its shareholders.
(l) Goods and Services Tax
Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST incurred is
not recoverable from the Australian Taxation Office (ATO). In these circumstances, the GST is recognised as part of the cost of acquisition of the
asset or as part of the expense.
Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the ATO is
included as a current asset or liability in the balance sheet.
Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows arising from investing and
financing activities which are recoverable from, or payable to, the ATO are classified as operating cash flows.
73
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
3. Material Accounting Policies (continued)
(m) Earnings per Share
The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or
loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period.
Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary
shares outstanding for the effects of all dilutive potential ordinary shares, which comprise share options granted to employees.
(n) Segment Reporting
Determination and Presentation of Operating Segments
An operating segment is a component of the Group that engages in business which directly relates to or supports its core business. An
operating segment’s operating results are regularly reviewed by the Chief Operating Decision Maker (CODM) to make decisions about
resources to be allocated to the segment and assess its performance and for which discrete information is available. Reportable segments that
are significant to the CODM include residential apartment development, commercial development, property rental, and business units which
generate revenue by providing supporting services to the core business (Corporate).
Segment results reported to the CODM include items directly attributable to a segment and those that can be allocated on a reasonable basis.
Unallocated items comprise cash, balances relating to equity accounted investees, and tax obligations.
Segment capital expenditure is the total cost incurred during the period to acquire property, plant, and equipment.
(o) New Standards and Interpretations
The Group adopted Disclosure of Accounting Policies (Amendments to AASB 101 and IFRS Practice Statement 2) from 1 January 2023. The
amendments require the disclosure of ‘material’, rather than ‘significant’, accounting policies. Although the amendments did not result in any
changes to the accounting policies themselves, they impacted the accounting policy information disclosed in Note 3 in certain instances.
A number of new standards are effective for annual periods beginning after 1 July 2024 and earlier application is permitted; however, the
Group has not early adopted the new or amended standards in preparing these consolidated financial statements.
The potential impact of the new standards, amendments to standards, and interpretations has been considered, and they are not expected to
have a significant impact on the financial statements.
Accounting standards issued but not yet effective
A number of new accounting standards are effective for annual periods beginning after 1 January 2023 and earlier application is permitted.
However, the Group has not early adopted the following new or amended accounting standards in preparing these consolidated financial
statements.
Classification of Liabilities as Current or Non-Current and Non-current Liabilities with Covenants (Amendments to AASB 101) - The
amendments, as issued in 2020 and 2022, aim to clarify the requirements on determining whether a liability is current or non-current, and
require new disclosures for non-current liabilities that are subject to future covenants. The amendments apply for annual reporting periods
beginning on or after 1 January 2024.
As disclosed in Notes 21, 24 and 27, the Group has secured commercial bills subject to specific covenants. While the liabilities are classified as
non-current at 30 June 2024, a future breach of the related covenants may require the Group to repay the liabilities earlier than the contractual
maturity dates. The Group is in the process of assessing the potential impact of the amendments on the classification of these liabilities and
the related disclosures.
4. Determination of Fair Values
A number of the Group’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets
and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. Where
applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.
(a) Investment Property and Property carried at fair value
An external, independent valuation company, having appropriately recognised professional qualifications and recent experience in the location
and category of the property being valued, values the Group’s investment property portfolio and property no less than once every three years.
The fair values are based on market values, being the estimated amount for which a property could be exchanged on the date of the valuation
between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted
knowledgeably and willingly.
In the absence of current prices in an active market, the valuations are prepared by considering the aggregate of the estimated cash flows
expected to be received from renting out the property. A yield that reflects the specific risks inherent in the net cash flows is then applied to the
net annual cash flows to arrive at the property valuation.
Valuations reflect, where appropriate: the type of tenants actually in occupation or responsible for meeting lease commitments or likely to be
in occupation after letting vacant accommodation, the allocation of maintenance and insurance responsibilities between the Group and
74
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
4. Determination of Fair Values (continued)
(a) Investment Property and Property carried at fair value (continued)
the lessee, and the remaining economic life of the property. When rent reviews or lease renewals are pending with anticipated reversionary
increases, it is assumed that all notices and where appropriate counter-notices, have been served validly and within the appropriate time.
Properties that have not been independently valued as at the balance sheet date are carried at fair value by way of directors’ valuation.
(b) Trade and Other Receivables
The fair value of trade and receivables, excluding construction work in progress, is estimated as the present value of future cash flows,
discounted at the market rate of interest at the reporting date. This fair value is determined for disclosure purposes.
(c) Financial Guarantees
For financial guarantee contract liabilities, the fair value at initial recognition is determined using a probability-weighted discounted cash
flow approach. This method takes into account the probability of default by the guaranteed party over the term of the contract, the loss given
default (being the proportion of the exposure that is not expected to be recovered in the event of default), and exposure at default (being the
maximum loss at the time of default).
5. Financial Risk Management
Overview
The Group has exposure to the following risks from their use of financial instruments:
• credit risk
• liquidity risk
• market risk
This note presents information about the Group’s exposure to each of the above risks, their objectives, policies, and processes for measuring
and managing risk, and the management of capital. Further quantitative disclosures are included throughout these consolidated financial
statements.
Risk Management Framework
The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The Board
has established an Audit and Risk Committee, which is responsible for developing and monitoring the Group’s risk management policies. The
Committee reports regularly to the Board on its activities.
Risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls,
and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market
conditions and the Group’s activities.
The Group’s Audit and Risk Committee oversees how management monitors compliance with the Group’s risk management policies and
procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the Group.
Credit Risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual
obligations, and arises principally from the Group’s receivables from customers and investment securities.
Trade and Other Receivables
The nature of the Group’s business means that most sales contracts occur on a pre-sales basis, before significant expenditure has been
incurred on the development. All pre-sale contracts require a deposit at the point of entering into the contract, these funds being held in trust
independently of the Group. Generally, pre-sale contracts are executed on an unconditional basis. Possession of a development property does
not generally pass until such time as the financial settlement of the property has been completed, and title to a development property does
not pass until the financial settlement of the property has been completed. Where possession of the development property is granted prior to
settlement, title to the property remains with the Group until financial settlement of the property has been completed.
The demographics of the Group’s customer base has little or no influence on credit risk. Approximately 18.10% (2023: 10.12%) of the Group’s
revenue is attributable to multiple sales transactions with single customers.
The Board of Directors has established a credit policy which undertakes an analysis of each sale. Purchase limits are established on
customers, with these purchase limits being reviewed on each property development.
The Group’s trade and other receivables relate mainly to expenses directly recoverable from landowners at project completion and loans to
equity accounted investees and associates. The loans to equity accounted investees bear interest at BBSY plus an agreed margin and are
repaid from proceeds on property settlement.
The Group has not established an allowance for impairment, as no losses are expected to be incurred in respect of trade and other receivables.
The trade and other receivables are mainly from related parties or being eligible for set-off against amounts owed to the borrower.
75
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
5. Financial Risk Management (continued)
Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing
liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and
stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.
The Group uses project by project costing to cost its products and services, which assists it in monitoring cash flow requirements and
optimising its cash return on investments. Typically the Group ensures that it has sufficient cash on demand to meet expected operational
expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances
that cannot reasonably be predicted, such as natural disasters.
Market Risk
Market risk is the risk that changes in market prices, such as interest rates, and equity prices will affect the Group’s income or the value of its
holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable
parameters, whilst optimising the return.
Interest Rate Risk
The Group continuously reviews its exposure to changes in interest rates and where it is considered prudent will enter into borrowings on a
fixed rate basis.
Capital Management
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future
development of the business. The Board of Directors monitors the return on capital, which the Group defines as total comprehensive income
attributable to the group divided by total shareholders’ equity, excluding non-controlling interests. The Board of Directors also monitors the
level of dividends to shareholders.
The Board seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowings and the advantages
and security afforded by a sound capital position. The Group’s target is to achieve a return on assets of between 6.00% and 8.00%; for the year
ended 30 June 2024 the return was 3.68% (2023: 1.09%). In comparison the weighted average interest expense on interest-bearing borrowings
(excluding liabilities with imputed interest) was 5.60% (2023: 3.66%).
The Group’s debt-to-capital ratio at the end of the financial year was as follows:
Note
2024
$’000
2023
$’000
Interest-bearing debt
21
309,147
107,661
Market Capitalisation as at 30 June
228,583
179,601
Total Capital
537,730
287,262
Debt-to-capital ratio at 30 June
57%
37%
From time to time, the Company purchases its own shares on the market. The timing of these purchases depends on market prices and
availability of unallocated company cash resources where not required for core business activity. Shares purchased are cancelled from issued
capital on purchase. The intention of the Board of Directors in undertaking such purchases is to enhance the capital return to the shareholders
of the Company. Buy decisions are made on a specific transaction basis by the Board of Directors.
In accordance with Rule 13 of the Company’s Dividend Reinvestment Plan (DRP), the Directors have elected to suspend the DRP in the 2024
financial year until further notice.
6. Operating Segments
The Group operates predominantly in the property development sector and has identified 4 reportable segments, as described below, which
are the Group’s three strategic business units, as well as Corporate and overheads. The strategic business units offer different products, and
are managed separately because they require different technology, marketing strategies and have different types of customers. For each of the
strategic business units, the Chief Operating Decision Maker (CODM) reviews internal management reports on a regular basis. The following
describes the operations in each of the Group’s reportable segments:
• Residential apartment development in Western Australia;
• Commercial office/retail development in Western Australia;
• Rental of property in Western Australia; and
• Corporate and overheads represents Finbar Group Limited (parent entity) and business units which generates project management
fees, property management fees and sales commission. This also includes net assets attributable to the corporate offices and other
administrative expenses, commission and property management.
76
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
6. Operating Segments (continued)
Information about Reportable Segments
For the Year ended 30 June 2024
Residential
Apartment
Development
$’000
Commercial
Office/Retail
Development
$’000
Rental of
Property
$’000
Corporate
and
Overheads
$’000
Total
$’000
External Revenues - Company and Subsidiaries
164,458
11,862
9,822
11,139
197,281
External Revenues - Equity Accounted Investees
13,197
-
-
-
13,197
External Revenues - Total
177,655
11,862
9,822
11,139
210,478
Reportable Segment Profit before Income Tax - Company and
Subsidiaries
8,460
874
6,870
7,960
24,164
Reportable Segment Profit before Income Tax - Equity Accounted
Investees
(280)
(6)
-
54
(232)
Reportable Segment Profit before Income Tax - Total
8,180
868
6,870
8,014
23,932
Reportable Segment Assets - Company and Subsidiaries
313,009
25,819
103,040
27,483
469,351
Reportable Segment Assets - Equity Accounted Investees
23,787
2,816
-
-
26,603
Reportable Segment Liabilities - Company and Subsidiaries
371,931
21,270
39,235
6,253
438,689
Reportable Segment Liabilities - Equity Accounted Investees*
20,898
756
-
2
21,656
Capital Expenditure
-
-
-
168
168
For the Year ended 30 June 2023
External Revenues - Company and Subsidiaries
19,214
3,137
9,454
2,386
34,191
External Revenues - Equity Accounted Investees
20,573
790
-
-
21,363
External Revenues - Total
39,787
3,927
9,454
2,386
55,554
Reportable Segment Profit before Income Tax - Company and
Subsidiaries
2,137
(236)
4,020
(2,753)
3,168
Reportable Segment Profit before Income Tax - Equity Accounted
Investees
1,047
34
-
32
1,113
Reportable Segment Profit before Income Tax - Total
3,184
(202)
4,020
(2,721)
4,281
Reportable Segment Assets - Company and Subsidiaries
249,321
22,467
101,634
28,225
401,647
Reportable Segment Assets - Equity Accounted Investees
31,968
2,653
-
-
34,621
Reportable Segment Liabilities - Company and Subsidiaries
132,802
9,295
40,433
10,772
193,302
Reportable Segment Liabilities - Equity Accounted Investees*
28,749
629
-
2
29,380
Capital Expenditure
-
-
-
206
206
* Excludes liabilities payable to Finbar Group Limited.
The Group’s share of revenues from equity accounted investees are reported in this table as they are managed by Finbar and reported to the
CODM. Revenues from equity accounted investees are not reported in the statement of profit or loss and other comprehensive income.
77
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
6. Operating Segments (continued)
Reconciliation of Reportable Segment Revenues, Profit or Loss, Assets and Liabilities
2024
$’000
2023
$’000
Revenues including Other Income
Total revenue for development reportable segments
176,320
22,351
Total revenue for rental segments
9,822
9,454
Total revenue for other reportable segments
11,139
2,386
Consolidated Revenue including Other Income
197,281
34,191
Total revenue for development reportable segments - Equity Accounted Investees
13,197
21,363
Total Reportable Segments Revenue including Other Income
210,478
55,554
Profit or Loss
Total profit or loss for reportable segments
23,932
4,281
Income tax applicable to share of loss/(profit) of equity accounted investees
70
(333)
Consolidated Profit before Income Tax
24,002
3,948
Assets
Total assets for reportable segments
469,351
401,647
Cash and cash equivalents
220,138
18,176
Investments in equity accounted investees
1,603
1,769
Unallocated assets**
13,442
18,973
Consolidated Total Assets
704,534
440,565
Liabilities
Total liabilities for reportable segments
438,689
193,302
Unallocated liabilities
9,346
7,191
Consolidated Total Liabilities
448,035
200,493
** Includes receivables due to Finbar Group Limited from equity accounted investees.
Geographical information
The Group operates predominantly in the one geographical segment of Western Australia.
78
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
7. Revenue
Note
2024
$’000
2023
$’000
Property development sales
176,320
22,351
Rental income
25
9,822
9,454
Management fees
8,202
2,160
Total Revenue
194,344
33,965
8. Other Income
X
X
Sales commission income
2,873
158
Administration fees
32
35
Other
32
33
Total Other Income
2,937
226
9. Personnel Expenses
X
X
Wages and salaries
6,311
4,589
Superannuation contributions
421
378
Increase/(Decrease) in liability for annual leave
44
(30)
Increase in liability for long service leave
86
51
Directors and committee fees
183
228
Non-executive directors - superannuation contributions
2
8
Total Personnel Expenses
7,047
5,224
Personnel expenses are included in administrative expenses on the Consolidated Statement
of Profit or Loss and Other Comprehensive Income for the year ended 30 June 2024.
10. Finance Income and Finance Costs
X
X
Recognised in Profit or Loss
Interest income on loans
810
690
Interest income on bank deposits
284
230
Interest income on loans to equity accounted investees
5
3
Interest income on property settlements
5
22
Total Finance Income
1,104
945
Interest expense
2,196
1,350
Bank charges
1,009
889
Total Finance Costs
3,205
2,239
Net Finance Costs
(2,101)
(1,294)
79
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
11. Income Tax Expense
2024
$’000
2023
$’000
Recognised in Income Statement
Current Tax Expense
Current year
3,441
3,024
Adjustments for prior periods
-
(3)
Write off/(Reversal) of previously recognised deferred tax
44
(162)
Non-recoverable amounts
102
27
3,587
2,886
Deferred Tax Expense Movement
Origination and reversal of temporary differences
3,812
(2,073)
Income Tax Expense recognised in profit or loss
7,399
813
Income tax recognised in other comprehensive income
(76)
(151)
Total Income Tax Expense recognised in total comprehensive income for the year
7,323
662
Numerical Reconciliation between Tax Expense and Pre-tax Net Profit
Profit before Income Tax
24,002
3,948
Income tax using the domestic rate of 30% (2023: 30%)
7,201
1,185
Movement in income tax expense due to:
Non-deductible expenses
3
-
Non-recoverable amounts
102
27
Write off/(Reversal) of previously recognised tax assets
44
(162)
Tax effect of share of equity accounted investees loss/(profit)
49
(234)
Total Income Tax Expense before prior year adjustments
7,399
816
Over provided in prior years
-
(3)
Total Income Tax Expense
7,399
813
Income tax recognised in other comprehensive income
(76)
(151)
Total Income Tax Expense recognised in total comprehensive income for the year
7,323
662
12. Investment Property
X
X
12a. Reconciliation of Carrying Amount
Balance at 1 July
100,952
102,189
Sale of investment property
(2,483)
(1,710)
Acquisition of investment property
-
716
Change in fair value
3,847
(243)
Balance at 30 June
102,316
100,952
Investment property comprises commercial properties at five developments and residential properties at two developments which are leased
to third parties (see Note 25).
The increase in the fair value was primarily as a result of higher rental yields from the residential properties compared to the prior year.
80
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
12. Investment Property (continued)
12b. Measurement of fair values
(i) Fair Value Hierarchy
The fair value of investment property was determined by external, independent property valuers, having appropriate recognised professional
qualifications and recent experience in the location and category of the property being valued or by director’s valuation.
In accordance with the Company’s policy, independent valuations were undertaken as follows:
- Pelago (Karratha) and Fairlanes (East Perth) in December 2023; and
- Aurelia (South Perth) in June 2024.
The Directors have adopted the Aurelia independent valuation at 30 June 2024 and have performed an internal valuation assessment for
Pelago and Fairlanes at 30 June 2024. No material change was identified for these assets from the December 2023 independent valuations.
The fair value assessment of the Company as at the reporting date includes the best estimates using information available at the time of
preparation of the financial statements and appropriate forward looking assumptions.
The fair value measurement for investment property of $102,316,000 (2023: $100,952,000) has been categorised as a Level 3 fair value based
on the inputs to the valuation technique used (see Note 2(d)).
(ii) Level 3 Fair Value
Note 12a shows a reconciliation from the opening balances to the closing balances for Level 3 fair values.
(iii) Valuation technique and significant unobservable inputs
The following table shows the valuation technique used in measuring the fair value of investment property, as well as the significant
unobservable inputs used.
Valuation Technique
Significant unobservable inputs
Inter-relationship between key
unobservable inputs and fair value
measurement
Discounted cash flows: The valuation
model considers the present value of
net cash flows able to be generated
from the property taking into account
expected rental growth rate, void
periods, occupancy rate, lease incentive
costs, such as rent-free periods and
other costs not paid by tenants. The
expected net cash flows are discounted
using risk-adjusted discount rates.
Among other factors, the discount rate
estimation considers the quality of
a building and its location (prime vs
secondary), tenant credit quality and
lease terms.
Expected market rental growth 2.00% -
4.00%;
Weighted average 3.15%;
Void periods (average 7.5 months after the
end of each lease);
Occupancy rate 70%;
Risk-adjusted discounted rates (weighted
average 8.00%).
The estimated fair value would increase
(decrease) if:
Expected market rental growth were
higher (lower);
Void periods were shorter (longer);
Occupancy rate were higher (lower);
Rent-free periods were shorter (longer); or
Risk-adjusted discount rate were lower
(higher).
Capitalisation of income valuation:
The capitalisation of income valuation
method capitalises the current rent
received, at a rate analysed from the
most recent transactions of comparable
property investments. The capitalisation
rate used varies across properties.
Valuations reflect, where appropriate,
lease term remaining, the relationship
of current rent to the market rent,
location and prevailing investment
market conditions.
Adopted capitalisation rate 6.75% - 12.00%;
Gross rent per annum $450 - $724 per sqm;
Occupancy rate 47% - 89%; and
Rent free period 27 months
The estimated fair value would increase
(decrease) if:
Adopted capitalisation rate were higher
(lower);
Gross rent per annum were higher (lower);
Occupancy rate were higher (lower); or
Lease term remaining were longer
(shorter).
81
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
13. Property, Plant and Equipment
Property
$’000
Office
Furniture and
Equipment
$’000
Plant and
Equipment
$’000
Fixtures and
Fittings
$’000
Total
$’000
Cost or Valuation
Balance at 1 July 2022
8,223
757
3,489
91
12,560
Additions
-
18
187
1
206
Change in fair value
(544)
-
-
-
(544)
Disposals
-
(2)
-
-
(2)
Balance at 30 June 2023
7,679
773
3,676
92
12,220
Balance at 1 July 2023
7,679
773
3,676
92
12,220
Additions
-
16
152
-
168
Change in fair value
(213)
-
-
-
(213)
Disposals
-
(11)
(187)
-
(198)
Balance at 30 June 2024
7,466
778
3,641
92
11,977
Depreciation
Balance at 1 July 2022
-
571
1,975
82
2,628
Disposals
-
(2)
-
-
(2)
Revaluation
(191)
-
-
-
(191)
Depreciation and amortisation charge for the year
191
35
71
2
299
Balance at 30 June 2023
-
604
2,046
84
2,734
Balance at 1 July 2023
-
604
2,046
84
2,734
Disposals
-
(11)
(15)
-
(26)
Revaluation
(191)
-
-
-
(191)
Depreciation and amortisation charge for the year
191
40
51
2
284
Balance at 30 June 2024
-
633
2,082
86
2,801
Carrying Amounts
At 1 July 2022
8,223
186
1,514
9
9,932
At 30 June 2023
7,679
169
1,630
8
9,486
At 1 July 2023
7,679
169
1,630
8
9,486
At 30 June 2024
7,466
145
1,559
6
9,176
For each revalued class, the carrying amount that would have been recognised had the assets been carried at historical cost basis are as follows:
Property
$’000
Revalued assets at cost
Cost
7,626
Less accumulated depreciation
(2,157)
Net book value at 30 June 2024
5,469
82
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
13. Property, Plant and Equipment (continued)
Measurement of fair values
(i) Fair Value Hierarchy
The fair value of property was determined by external, independent property valuers, having appropriate recognised professional qualifications
and recent experience in the location and category of the property being valued or by director’s valuation.
In accordance with the Company’s policy, independent valuations were undertaken in December 2023 on existing properties, Pelago in
Karratha and Fairlanes in East Perth. At June reporting period, the Directors confirm that there is no change to the valuations undertaken in
December 2023, other than the movements at Note 13(ii).
The fair value assessment of the Company as at the reporting date includes the best estimate using information available at the time of
preparation of the financial statements and appropriate forward looking assumptions.
The fair value measurement for property of $7,466,000 (2023: $7,679,000) has been categorised as a Level 3 fair value based on the inputs to
the valuation technique used (see Note 2(d)).
(ii) Level 3 Fair Value
The following table shows a reconciliation from the opening balances to the closing balances for Level 3 fair values.
2024
$’000
2023
$’000
Balance at 1 July
7,679
8,223
Revaluation increase included in ‘profit or loss’
230
151
Revaluation decrease included in ‘other comprehensive income’
(252)
(504)
Depreciation
(191)
(191)
Balance at 30 June
7,466
7,679
(iii) Valuation technique and significant unobservable inputs
The following table shows the valuation technique used in measuring the fair value of property, plant and equipment, as well as the
significant unobservable inputs used.
Valuation Technique
Significant unobservable inputs
Inter-relationship between key unobservable
inputs and fair value measurement
Discounted cash flows: The valuation model
considers the present value of net cash flows
able to be generated from the property taking
into account expected rental growth rate, void
periods, occupancy rate, lease incentive costs,
such as rent-free periods and other costs not
paid by tenants. The expected net cash flows
are discounted using risk-adjusted discount
rates. Among other factors, the discount rate
estimation considers the quality of a building
and its location (prime vs secondary), tenant
credit quality and lease terms.
Expected market rental growth
2.00% - 4.00%;
Weighted average 3.15%;
Void periods (average 7.5 months
after the end of each lease);
Occupancy rate 70%;
Risk-adjusted discounted rates
(weighted average 8.00%).
The estimated fair value would increase
(decrease) if:
Expected market rental growth were higher
(lower);
Void periods were shorter (longer);
Occupancy rate were higher (lower);
Rent-free periods were shorter (longer); or
Risk-adjusted discount rate were lower (higher).
Capitalisation of income valuation: The
capitalisation of income valuation method
capitalises the current rent received, at
a rate analysed from the most recent
transactions of comparable property
investments. The capitalisation rate used
varies across properties. Valuations reflect,
where appropriate, lease term remaining, the
relationship of current rent to the market rent,
location and prevailing investment market
conditions.
Adopted capitalisation rate 6.75% -
12.00%;
Gross rent per annum $450 - $724
per sqm;
Occupancy rate 47% - 89%; and
Rent free period 27 months
The estimated fair value would increase
(decrease) if:
Adopted capitalisation rate were higher (lower);
Gross rent per annum were higher (lower);
Occupancy rate were higher (lower); or
Lease term remaining were longer (shorter).
83
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
14. Investments in Equity Accounted Investees
The Group accounts for investments in equity accounted investees using the equity method.
The Group has the following investments in equity accounted investees (all stated at 100% of the values):
Equity Accounted Investees
Net Assets/(Liabilities)
2024
Ownership
Garden
Towers
East Perth
Pty Ltd
$’000
240
Adelaide
Terrace
Pty Ltd
$’000
647
Murray
Street
Pty Ltd*
$’000
Axis
Linkit
Pty
Ltd*
$’000
Finbar
Sub
5050 Pty
Ltd
$’000
Lot
1001
- 1003
Pty Ltd
$’000
Rowe
Avenue
Pty
Ltd
$’000
Total
$’000
Assets - Current Assets 1
504
19,268
-
-
-
21
7
19,800
Assets - Non-current
31,742
51
-
-
2
-
4,447
36,242
Liabilities - Current 2
(397)
(17,843)
-
-
-
(7)
(13)
(18,260)
Liabilities - Non-current 3
(33,477)
(191)
-
-
(7)
-
(902)
(34,577)
Net Assets/(Liabilities)
100%
(1,628)
1,285
-
-
(5)
14
3,539
3,205
Group’s share of net assets/(liabilities)
50%
(814)
643
-
-
(3)
7
1,770
1,603
1 Includes cash and cash equivalents 2 Includes current financial liabilities 3 Includes non-current financial liabilities
2023
Assets - Current Assets 1
986
45,394
1
-
-
5
2
46,388
Assets - Non-current
24,141
51
-
1
2
-
4,360
28,555
Liabilities - Current 2
(62)
(43,591)
-
-
-
(1)
-
(43,654)
Liabilities - Non-current 3
(26,495)
(428)
-
(2)
(7)
-
(819)
(27,751)
Net Assets/(Liabilities)
100%
(1,430)
1,426
1
(1)
(5)
4
3,543
3,538
Group’s share of net assets/(liabilities)
50%
(715)
713
1
(1)
(3)
2
1,772
1,769
1 Includes cash and cash equivalents 2 Includes current financial liabilities 3 Includes non-current financial liabilities
Profit/(Loss) Before Income Tax
Recognised from Equity Accounted
Investees
2024
Ownership
Garden
Towers
East Perth
Pty Ltd
$’000
240
Adelaide
Terrace
Pty Ltd
$’000
647
Murray
Street
Pty Ltd*
$’000
Axis
Linkit
Pty
Ltd*
$’000
Finbar
Sub
5050 Pty
Ltd
$’000
Lot
1001
- 1003
Pty Ltd
$’000
Rowe
Avenue
Pty
Ltd
$’000
Total
$’000
Revenue
-
26,550
-
3
-
28
-
26,581
Expenses
(299)
(25,846)
-
-
-
-
11
(26,134)
Interest income
18
122
-
-
-
1
-
141
Interest expense
-
(1,033)
-
-
(1)
-
(18)
(1,052)
Income tax (expense)/refund
84
62
-
(1)
-
(9)
2
138
Profit/(Loss) after income tax
100%
(197)
(145)
-
2
(1)
20
(5)
(326)
Group’s share of Profit/(Loss) after
income tax
50%
(99)
(73)
-
1
-
10
(2)
(163)
2023
Revenue
32
42,686
-
-
-
8
-
42,726
Expenses
113
(38,504)
-
-
-
(6)
(3)
(38,400)
Interest income
11
104
-
-
-
5
-
120
Interest expense
(863)
(1,342)
-
-
(1)
-
(11)
(2,217)
Income tax (expense)/refund
212
(883)
-
-
-
(2)
4
(669)
Profit/(Loss) after income tax
100%
(495)
2,061
-
-
(1)
5
(10)
1,560
Group’s share of Profit/(Loss) after
income tax
50%
(248)
1,031
-
-
(1)
3
(5)
780
* 647 Murray Street Pty Ltd and Axis Linkit Pty Ltd were deregistered during the 2024 financial year.
84
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
15. Tax Assets and Liabilities
The current tax liability for the Group of $2,554,000 (2023: $1,882,000) represents the amount of income taxes payable in respect of current
and prior periods.
Recognised Deferred Tax Assets and Liabilities
Deferred tax assets and liabilities are attributable to the following:
Assets
Liabilities
2024
$’000
2023
$’000
2024
$’000
2023
$’000
Inventories
-
-
(9,113)
(7,068)
Interest bearing loans and borrowings
567
602
-
-
Revaluation of investment property
-
-
(2,646)
(1,725)
Revaluation of property, plant and equipment*
-
-
(65)
(129)
Other items
2,872
3,416
(32)
(83)
Tax value of carry-forward losses recognised
7,349
7,730
-
-
Tax assets/(liabilities)
10,788
11,748
(11,856)
(9,005)
Set off of tax
(5,063)
(3,695)
5,063
3,695
Net Tax
5,725
8,053
(6,793)
(5,310)
* The tax effect on the revaluation of property, plant and equipment recognised in other comprehensive income in the current period was
$76,000 (2023: $151,000).
16. Inventories
2024
$’000
2023
$’000
Current
Work in progress
163,109
143,199
Completed stock
141,851
2,684
Total Current Inventories
304,960
145,883
Non-current
Work in progress
26,806
114,878
Total Non-current Inventories
26,806
114,878
17. Trade and Other Receivables
X
X
Current
Trade receivables
8,745
12,565
Other receivables
9,314
419
Amounts receivable from equity accounted investees
3,406
7,502
Total Current Trade and Other Receivables
21,465
20,486
Non-current
Trade receivables
19
1,145
Other receivables
7,547
15,357
Amounts receivable from equity accounted investees
4,309
3,415
Total Non-current Trade and Other Receivables
11,875
19,917
Amounts receivable from equity accounted investees bear interest at BBSY plus an agreed margin.
The Group’s exposure to credit risk and impairment losses to trade and other receivables are disclosed in Note 24.
85
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
18. Cash and Cash Equivalents
2024
$’000
2023
$’000
18a. Cash and Cash Equivalents
Bank balances
220,138
18,176
Cash and cash equivalents
220,138
18,176
The Group’s exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities is disclosed in Note 24.
18b. Reconciliation of Cash Flows from Operating Activities
Note
2024
$’000
2023
$’000
Cash Flows from Operating Activities
Profit for the year
16,603
3,135
Adjustments for:
Depreciation and amortisation
13
284
299
Profit on disposal of assets
(14)
-
Revaluation of investment property
12a
(3,847)
243
Revaluation of property, plant & equipment
(230)
(151)
Loss/(Gain) on sale of investment property
222
(491)
Net financing cost
1,092
405
Share of net loss/(profit) of equity accounted investees
163
(780)
Income tax expense
11
7,399
813
Operating Profit before Changes in Working Capital and Provisions
21,672
3,473
Change in trade and other receivables
12,815
2,049
Change in inventories
16
(71,005)
(118,375)
Change in prepayments
497
(93)
Change in provision for employee benefits
22
131
20
Change in trade and other payables
32,756
3,793
Cash used in Operating Activities
(3,134)
(109,133)
Interest paid
(10,342)
(1,738)
Income taxes paid
(2,841)
(2,788)
Net Cash used in Operating Activities
(16,317)
(113,659)
The increases and decreases in trade and other receivables as well as trade and other payables reflect only those changes that relate to
operating activities. The remaining increases and decreases relate to investing activities.
Company
Ordinary Shares
19. Capital and Reserves
2024
2023
Share Capital
On issue at 1 July
272,123,142
272,123,142
On Issue at 30 June - Fully Paid
272,123,142
272,123,142
The Company does not have authorised capital or par value in respect of its issued shares.
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at
meetings of the Company. All shares rank equally with regard to the Company’s residual assets.
86
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
19. Capital and Reserves (continued)
Dividends
Dividends Paid During the Year 2023
Cents per
Share
Total Amount
$’000
Franked /
Unfranked
Date of Payment
Final 2022 ordinary
2.00
5,442
Franked
9 September 2022
Total Dividends Paid
5,442
After 30 June 2024, the following dividend has been proposed by the Directors. The dividend has not been provided. The declaration and
subsequent payment of dividends has no income tax consequences.
Proposed Dividend
Dividend proposed by the Group are:
Cents per
Share
Total Amount
$’000
Franked /
Unfranked
Date of Payment
Final 2024 ordinary
8.00
21,770
Franked
10 October 2024
Total Amount
21,770
The financial effect of this dividend has not been brought to account in the financial statements for the financial year ended 30 June 2024 and
will be recognised in subsequent financial reports.
Dividend Reinvestment Plan
The Company has a dividend reinvestment plan under which holders of ordinary shares may elect to have all or part of their dividend
entitlements satisfied by the issue of new ordinary shares rather than by being paid in cash.
In accordance with Rule 13 of the Company’s Dividend Reinvestment Plan (DRP), the Directors have elected to suspend the DRP in the 2024
financial year until further notice.
Dividend Franking Account
Company
2024
$’000
2023
$’000
30% franking credits available to shareholders of Finbar Group Limited for subsequent financial years
14,667
12,251
The above available amounts are based on the balance of the dividend franking account at year-end adjusted for:
(a) franking credits that will arise from the payment of current tax liabilities;
(b) franking debits that will arise from the payment of dividends recognised as a liability at the year-end;
(c) franking credits that will arise from the receipt of dividends recognised as receivables at the year-end; and
(d) franking credits that the entity may be prevented from distributing in subsequent years.
The ability to utilise the franking credits is dependent upon there being sufficient available profits to declare dividends. The impact on the
dividend franking account of dividends proposed after balance sheet date but not recognised as a liability is to reduce it by $9,330,000
(2023: Nil).
Nature and purpose of reserve
Asset revaluation reserve
The revaluation reserve relates to the revaluation of property, plant and equipment carried at fair value.
87
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
20. Earnings per Share
Basic and Diluted Earnings per Share
The calculation of basic and diluted earnings per share at 30 June 2024 was based on the profit attributable to ordinary shareholders
of $16,603,000 (2023: $3,135,000) and a weighted average number of ordinary shares on issue during the year ended 30 June 2024 of
272,123,142 (2023: 272,123,142), calculated as follows:
2024
$’000
2023
$’000
Profit Attributable to Ordinary Shareholders
16,603
3,135
Ordinary Shares
Weighted Average Number of Ordinary Shares
2024
2023
Issued ordinary shares at 1 July
272,123,142
272,123,142
Weighted Average Number of Ordinary Shares at 30 June
272,123,142
272,123,142
Basic and Diluted Earnings per Share (cents per share)
6.10
1.15
21. Loans and Borrowings
This note provides information about the contractual terms of the Group’s interest-bearing loans and borrowings. For more information about
the Group’s exposure to interest rate risk see Note 24.
Current
2024
$’000
2023
$’000
Commercial bills (Secured)
257,683
97,731
Investor loans (Secured)
-
932
Investor loans (Unsecured)
88,764
63,674
Total Current Loans and Borrowings
346,447
162,337
Non-current
Commercial bills (Secured)
42,319
1,450
Investor loans (Unsecured)
-
13,353
Total Non-current Loans and Borrowings
42,319
14,803
Terms and debt repayment schedule
Terms and conditions of outstanding loans are as follows:
2024
2023
Current
Nominal Interest Rate
Financial
Year of
Maturity
Carrying
Amount
$’000
Carrying
Amount
$’000
Commercial bills (Secured)
BBSY+1.60%
2025
173,500
53,638
Commercial bills (Secured)
BBSY+1.50%
2025
46,362
413
Commercial bills (Secured)
BBSY+1.60%
2025
37,821
-
Commercial bills (Secured)
BBSY+2.00%
2024
-
21,840
Commercial bills (Secured)
BBSY+2.40%
2024
-
21,840
Investor loans (Unsecured)*
BBSY+1.50%
2025
5,816
-
Investor loans (Unsecured)*
BBSY+3.00%
2025
3,311
-
Investor loans (Unsecured)*
BBSY+1.50%
2025
18
-
Investor loans from landowner (Unsecured)
2025
55,064
53,674
Investor loans from landowner (Unsecured)
2025
18,750
10,000
Investor loans from landowner (Unsecured)
2025
5,805
-
Investor loans (Secured)*
BBSY+1.50%
2024
-
932
Total Current Loans and Borrowings
346,447
162,337
88
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
21. Loans and Borrowings (continued)
2024
2023
Non-current
Nominal Interest Rate
Financial
Year of
Maturity
Carrying
Amount
$’000
Carrying
Amount
$’000
Commercial bills (Secured)
BBSY+1.60%
2025
-
1,450
Commercial bills (Secured)
BBSY+2.00%
2027
20,479
-
Commercial bills (Secured)
BBSY+2.40%
2027
21,840
-
Investor loans from landowner (Unsecured)
2025
-
5,805
Investor loans (Unsecured)*
BBSY+1.50%
2025
-
5,446
Investor loans (Unsecured)*
BBSY+3.00%
2025
-
2,102
Total Non-current Loans and Borrowings
42,319
14,803
* Please refer to Note 28 for details of related party loans.
Financing Arrangements
Commercial bills
The commercial bills are secured by registered first mortgages over the land and buildings (including those under construction) and a
registered mortgage debenture over the assets and undertakings of the subsidiaries. The loans relate to a specific project or property and
are denominated in Australian dollars. There are no cross securities against other projects or property within the Group to assist in mitigating
risk in the event of default on a commercial bill. The bank guarantees within the Group are disclosed in Note 27.
When a project is undertaken, initial funding is provided by the Group, equity accounted investees partners, and development landowners
where applicable. Project developments are marketed and pre-sales are secured with customer deposits which are held in trust and not
reflected on the Company’s balance sheet. Typically, external funding is accessible when minimum compliant pre-sales are achieved, secured
over a specific project, and only to fund progress development costs. As a project nears its completion date, it is expected that the available
facility will near or be at its fully drawn limit. When a project is completed and settlement proceeds are received, the proceeds are firstly
applied to facility repayments and then payments to the project investors in accordance with the negotiated development agreements. The
returned capital is reinvested into the Group’s future projects and activities as well as payment of dividends to shareholders.
Investor Loans
Investor Loans are generally repayable upon the completion of the project, unless otherwise agreed.
22. Employee Benefits
2024
$’000
2023
$’000
Current
Liability for annual leave
167
123
Liability for long-service leave
732
684
Total Current Employee Benefits
899
807
Non-current
Liability for long-service leave
50
11
Total Non-current Employee Benefits
50
11
89
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
23. Trade and Other Payables
2024
$’000
2023
$’000
Current
Trade and other payables
41,354
13,192
Other payables and accrued expenses
7,619
1,894
Total Current Trade and Other Payables
48,973
15,086
Non-current
Other payables and accrued expenses
-
257
Total Non-current Trade and Other Payables
-
257
At 30 June 2024, consolidated trade and other payables include retentions of $757,000 (2023: $467,000) relating to construction contracts in
progress.
The Group’s exposure to liquidity risk related to trade and other payables is disclosed in Note 24.
24. Financial Instruments
Credit Risk
Exposure to Credit Risk
The carrying amount of the Group’s financial assets represent the maximum credit exposure.
Carrying Amount
The Group’s maximum exposure to credit risk at the reporting date was:
Note
2024
$’000
2023
$’000
Trade and other receivables - Current
17
21,465
20,486
Trade and other receivables - Non-current
17
11,875
19,917
Cash and cash equivalents
18a
220,138
18,176
253,478
58,579
The Group’s maximum exposure to credit risk for trade and other receivables at the reporting
date by receivable category was:
Amounts receivable from equity accounted investees
7,715
10,917
GST refunds due and other trade debtors
7,854
11,208
Other receivables
16,861
15,776
Working capital advances and bonds
910
2,502
33,340
40,403
Impairment Losses
None of the Group’s trade or other receivables are past due. Based on historic default rates and security held, the Group believes that no
impairment allowance is necessary in respect of trade or other receivables.
Liquidity Risk
The following are the contractual maturities of non-derivative financial liabilities, including estimated interest payments and excluding the
impact of netting agreements:
30 June 2024
Non-derivative Financial Liabilities
Note
Carrying
Amount
$’000
Contractual
Cash Flows
$’000
1 Year or
Less
$’000
1-3 Years
$’000
Commercial bills*
21
300,002
310,152
262,634
47,518
Investor Loans*
21
88,764
88,913
88,913
-
Trade and other payables
23
48,973
48,973
48,973
-
437,739
448,038
400,520
47,518
90
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
24. Financial Instruments (continued)
30 June 2023
Non-derivative Financial Liabilities
Note
Carrying
Amount
$’000
Contractual
Cash Flows
$’000
1 Year or
Less
$’000
1-3 Years
$’000
Commercial bills*
21
99,181
104,798
103,326
1,472
Investor Loans*
21
77,959
78,474
64,609
13,865
Trade and other payables
23
15,343
15,343
15,086
257
192,483
198,615
183,021
15,594
* Refer to Note 21 Loans and borrowings for details on loan maturity.
Interest Rate Risk
Profile
At the reporting date the interest rate profile of the Group’s interest-bearing financial assets and liabilities was:
Carrying Amount
Variable Rate Instruments
2024
$’000
2023
$’000
Financial Assets
223,990
21,819
Financial Liabilities
(309,147)
(107,661)
(85,157)
(85,842)
Cash Flow Sensitivity Analysis for Variable Rate Instruments
A change of 100 basis points in interest rates would have (decreased)/increased the Group’s equity and profit or loss by the amounts shown
below. This analysis assumes that all variables remain constant. The analysis is on the same basis for 2023.
Profit or Loss
Equity
30 June 2024
100bp
Increase
$’000
100bp
Decrease
$’000
100bp
Increase
$’000
100bp
Decrease
$’000
Variable rate instruments
(1,995)
1,995
(1,995)
1,995
100bp
Increase
$’000
100bp
Decrease
$’000
100bp
Increase
$’000
100bp
Decrease
$’000
30 June 2023
Variable rate instruments
(616)
616
(616)
616
Fair Values
Fair Values Versus Carrying Amounts
The fair values of financial assets and liabilities, as detailed below, approximates to the carrying amounts shown on the balance sheet:
Fair Values
Note
2024
$’000
2023
$’000
Trade and other receivables
17
33,340
40,403
Cash and cash equivalents
18a
220,138
18,176
Secured commercial bills
21
(300,002)
(99,181)
Investor loans
21
(88,764)
(77,959)
Trade and other payables
23
(48,973)
(15,343)
91
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
24. Financial Instruments (continued)
The methods and assumptions used to estimate the fair value of financial instruments are as follows:
Trade and other receivables
The carrying amount approximates fair value given the short term nature of the balances and the market based commercial terms.
Cash and cash equivalents
The carrying amount is fair value due to the liquid nature of these assets.
Secured commercial bills
The carrying amount approximates fair value given the short term nature of the balances.
Investor loans
The carrying amount approximates fair value given the short term nature of the balances and the market based commercial terms.
Trade and other payables
The carrying amount approximates fair value given the short term nature of the balances and the market based commercial terms.
25. Operating Leases
Note
2024
$’000
2023
$’000
Leases as Lessor
The Group leases out its investment properties held under operating leases.
Rental income received from investment property
9,560
9,118
Other rental property income received
262
336
7
9,822
9,454
Future minimum lease receipts
At 30 June, the future minimum lease receipts under non-cancellable leases expected to be
received as follows:
Less than one year
5,809
5,955
Between one and five years
5,367
3,551
More than 5 years
175
494
11,351
10,000
26. Capital and Other Commitments
Commitments and Contingent Liabilities
Property Development
Contracted but not provided for and payable:
Within one year
17,287
130,497
Later than one year
-
7,384
Total Property Development Commitments
17,287
137,881
Property Development - Equity Accounted Investees
Contracted but not provided for and payable:
Within one year
64,196
-
Later than one year
69,180
-
Total Property Development Commitments - Equity Accounted Investees
133,376
-
92
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
26. Capital and Other Commitments (continued)
Group’s Share of Property Development - Equity Accounted Investees
Contracted but not provided for and payable:
2024
$’000
2023
$’000
Within one year
32,098
-
Later than one year
34,590
-
Total Share of Property Development Commitments - Equity Accounted Investees
66,688
-
Group’s Property Development Commitments including Equity Accounted Investees
Contracted but not provided for and payable:
Within one year
49,385
130,497
Later than one year
34,590
7,384
Group’s Total Property Development Commitments including Equity Accounted Investees
83,975
137,881
27. Contingencies
X
X
The Directors are of the opinion that provisions are not required for the guarantees below, as it is not
probable that a future sacrifice of economic benefits will be required or the amount is not capable of reliable
measurement.
Guarantees
Finbar Group Limited guaranteed commercial bill over investment property in Karratha (Pelago)
20,479
21,840
Finbar Group Limited guaranteed commercial bill over investment property in East Perth (Fairlanes)
3,000
2,184
Total Guarantees
23,479
24,024
28. Related Parties
X
X
The key management personnel compensation included in ‘personnel expenses’ is as follows:
Short term employee benefits
2,865
2,367
Other long term benefits
112
111
Post employment benefits
32
21
Employee benefits
3,009
2,499
Individual Directors and Executives Compensation Disclosures
Information regarding individual directors and executives compensation are provided in the Remuneration Report section of the Directors’
report on pages 50 to 54.
Equity Accounted Investees
Loans are made by the Group to equity accounted investees for property development undertakings. Loans outstanding from the Group to
equity accounted investees are interest bearing and are repayable at the completion of the equity accounted investees development project.
2024
$’000
2023
$’000
As at 30 June, the balance of these loans (see Note 17) were as follows:
Garden Towers East Perth Pty Ltd
4,092
3,224
240 Adelaide Terrace Pty Ltd
3,406
7,502
Axis Linkit Pty Ltd
-
1
Finbar Sub 5050 Pty Ltd
3
3
Rowe Avenue Pty Ltd
214
187
7,715
10,917
93
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
28. Related Parties (continued)
Ventrade Australia Pty Ltd is a related party of Chuan Hup Holdings Limited who owns 25.19% of Finbar Group Limited. Ventrade Australia Pty
Ltd owns 50% of the following equity accounted investees disclosed in Note 14:
• 240 Adelaide Terrace Pty Ltd (AT238): 34 units have settled in the reporting period and 3 units settled post the reporting period. 15 units
remain for sale in the 121 unit development; and
• Garden Towers East Perth Pty Ltd (Garden Towers East Perth): Marketing of the Garden Towers project continues to progress well, with
construction commenced in April 2024, with completion expected during financial year ending 30 June 2027.
Other Related Party Transactions
Nominal
Interest Rate
Financial
Year of
Maturity
2024
$’000
2023
$’000
As at 30 June, related party loans (see Note 21) were as follows:
Ventrade Australia Pty Ltd (Unsecured)
BBSY+1.50%
2025
5,816
5,446
Forward International Pty Ltd (Unsecured)
BBSY+3.00%
2025
2,989
2,102
Forward International Pty Ltd (Unsecured)
BBSY+1.50%
2025
18
-
Ventrade Australia Pty Ltd (Secured)
BBSY+1.50%
2024
-
932
8,823
8,480
29. Group Entities
Australian
or Foreign
Resident
Country of
Incorporation
Shareholding/
Unit Holding
$
Ownership Interest
2024
2023
Parent Company
Finbar Group Limited
Subsidiaries
1 Mends Street Pty Ltd
Australian
Australia
1
100%
100%
2 Homelea Court Springs Pty Ltd
Australian
Australia
1
100%
100%
31 Rowe Avenue Pty Ltd
Australian
Australia
1
100%
100%
32 Riversdale Road Pty Ltd
Australian
Australia
1
100%
100%
36 Chester Avenue Pty Ltd
Australian
Australia
2
100%
100%
43 McGregor Road Pty Ltd
Australian
Australia
1
100%
100%
5-7 Harper Terrace Pty Ltd
Australian
Australia
1
100%
100%
63 Adelaide Terrace Pty Ltd
Australian
Australia
1
100%
100%
88 Terrace Road Pty Ltd
Australian
Australia
1
100%
100%
175 Adelaide Terrace Pty Ltd
Australian
Australia
1
100%
100%
239 Great Eastern Highway Pty Ltd
Australian
Australia
1
100%
100%
241 Railway Parade Pty Ltd
Australian
Australia
1
100%
100%
Finbar Applecross Pty Ltd
Australian
Australia
1
100%
100%
Finbar Commercial Pty Ltd
Australian
Australia
1
100%
100%
Finbar Finance Pty Ltd
Australian
Australia
1
100%
100%
Finbar Fund Pty Ltd
Australian
Australia
1
100%
100%
Finbar Karratha Pty Ltd
Australian
Australia
1
100%
100%
Finbar Port Hedland Pty Ltd
Australian
Australia
1
100%
100%
Finbar Project Management Pty Ltd
Australian
Australia
2
100%
100%
Finbar To Rent Pty Ltd
Australian
Australia
1
100%
100%
Finbar Sales Pty Ltd
Australian
Australia
1
100%
100%
Finbar Sub 104 Pty Ltd
Australian
Australia
1
100%
100%
Finbar Executive Rentals Pty Ltd
Australian
Australia
1
100%
100%
Lot 1 to 10 Whatley Crescent Pty Ltd (Deregistered)
Australian
Australia
-
-
100%
25
94
2024 Finbar Group Limited Annual Report
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Year Ended 30 June 2024
30. Subsequent Events
There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a
material and unusual nature likely, in the opinion of the Directors of the Company, to affect significantly the operations of the Group, the
results of those operations, or the state of affairs of the Group in future financial years.
31. Auditors’ Remuneration
2024
$
2023
$
Audit Services:
Auditors of the Group
Audit and review of financial statements of the Group - KPMG
189,824
181,778
Audit and review of financial statements of Subsidiaries - KPMG
14,000
-
Audit and review of trust accounts - Other Auditors
4,496
4,037
208,320
185,815
Services other than Statutory Audit:
Taxation advice and tax compliance services - KPMG
26,888
21,527
26,888
21,527
32. Parent Entity Disclosures
2024
$’000
2023
$’000
As at and throughout the financial year ending 30 June 2024, the parent company of the Group was Finbar
Group Limited.
Result of the Parent Entity
Profit for the year (after tax)
6,485
6,450
Total Comprehensive Income for the year
6,485
6,450
Financial Position of the Parent Entity
Current Assets
18,123
15,815
Total Assets
227,638
220,605
Current Liabilities
7,810
1,282
Total Liabilities
7,810
6,790
Total Equity of the Parent Entity comprising of:
Share capital
194,484
194,484
Retained earnings
25,344
19,331
Total Equity
219,828
213,815
Parent Entity Contingencies
The Directors are of the opinion that provisions are not required, as it is not probable that a future sacrifice of economic benefits will be
required or the amount is capable of reliable measurement.
95
2024 Finbar Group Limited Annual Report
CONSOLIDATED ENTITY DISCLOSURE STATEMENT
For the Year Ended 30 June 2024
Entity Name
Body Corporate,
Partnership or Trust
Place
Incorporated/
Formed
Shareholding/
Unit Holding
Australian or
Foreign Tax
Resident
Finbar Group Limited (Parent Company)
Body Corporate
Australia
Australian
1 Mends Street Pty Ltd
Body Corporate
Australia
100%
Australian
2 Homelea Court Springs Pty Ltd
Body Corporate
Australia
100%
Australian
31 Rowe Avenue Pty Ltd
Body Corporate
Australia
100%
Australian
32 Riversdale Road Pty Ltd
Body Corporate
Australia
100%
Australian
36 Chester Avenue Pty Ltd
Body Corporate
Australia
100%
Australian
43 McGregor Road Pty Ltd
Body Corporate
Australia
100%
Australian
5-7 Harper Terrace Pty Ltd
Body Corporate
Australia
100%
Australian
63 Adelaide Terrace Pty Ltd
Body Corporate
Australia
100%
Australian
88 Terrace Road Pty Ltd
Body Corporate
Australia
100%
Australian
175 Adelaide Terrace Pty Ltd
Body Corporate
Australia
100%
Australian
239 Great Eastern Highway Pty Ltd
Body Corporate
Australia
100%
Australian
241 Railway Parade Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Applecross Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Commercial Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Finance Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Fund Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Karratha Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Port Hedland Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Project Management Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar To Rent Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Sales Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Sub 104 Pty Ltd
Body Corporate
Australia
100%
Australian
Finbar Executive Rentals Pty Ltd
Body Corporate
Australia
100%
Australian
Key Assumptions and Judgements
Determination of Tax Residency
Section 295 (3A) of the Corporation Acts 2001 requires that the tax residency of each entity which is included in the Consolidated Entity
Disclosure Statement (CEDS) be disclosed. In the context of an entity which was an Australian resident, “Australian resident” has the meaning
provided in the Income Tax Assessment Act 1997. The determination of tax residency involves judgment, as the determination of tax residency
is highly fact dependent and there are currently several different interpretations that could be adopted, and which could give rise to a different
conclusion on residency.
In determining tax residency, the consolidated entity has applied the following interpretations:
Australian tax residency - The consolidated entity has applied current legislation and judicial precedent, including having regard to the
Commissioner of Taxation’s public guidance in Tax Ruling TR 2018/5.
96
2024 Finbar Group Limited Annual Report
1. In the opinion of the Directors of Finbar Group Limited (‘the Company’):
a) The consolidated financial statements and notes that are contained in Pages 66 to 95 and the Remuneration report in section 4.3 in the
Directors’ report, set out on Pages 50 to 54, are in accordance with the Corporations Act 2001, including:
i) giving a true and fair view of the Group’s financial position as at 30 June 2024 and of its performance for the year ended on that
date; and
ii) complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations
Regulations 2001;
b) The consolidated entity disclosure statement as at 30 June 2024 set out on page 96 is true and correct; and
c) There are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable.
2. The Directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Managing Director and the
Chief Financial Officer for the financial year ended 30 June 2024.
3. The Directors draw attention to Note 2(a) to the consolidated financial statements, which contains a statement of compliance with
International Financial Reporting Standards.
Signed in accordance with a resolution of the Board of Directors:
Darren Pateman
Managing Director
Dated at Perth this Twentieth day of August 2024.
DIRECTORS’ DECLARATION
97
2024 Finbar Group Limited Annual Report
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated
with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and
logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited
by a scheme approved under Professional Standards Legislation.
Independent Auditor’s Report
To the shareholders of Finbar Group Limited
Report on the audit of the Financial Report
Opinion
We have audited the Financial Report of
Finbar Group Limited (the Company).
In our opinion, the accompanying Financial
Report of the Company gives a true and
fair view, including of the Group’s
financial position as at 30 June 2024 and
of its financial performance for the year
then ended, in accordance with the
Corporations Act 2001, in compliance with
Australian Accounting Standards and the
Corporations Regulations 2001.
The Financial Report comprises:
• Consolidated statement of financial position as at
30 June 2024.
• Consolidated statement of profit or loss and other
comprehensive income, Consolidated statement of
changes in equity, and Consolidated statement of cash
flows for the year then ended.
• Consolidated entity disclosure statement and
accompanying basis of preparation as at 30 June 2024.
• Notes, including material accounting policies.
• Directors’ Declaration.
The Group consists of the Company and the entities it
controlled at the year-end or from time to time during the
financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
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 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 fulfilled our other ethical responsibilities in accordance with
these requirements.
Key Audit Matters
The Key Audit Matters we identified are:
• Valuation of Investment Properties;
and
• Carrying Value of Inventory.
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.
Valuation of Investment Property ($102.3 million)
Refer to Note 12 to the Financial Report
The key audit matter
How the matter was addressed in our audit
Valuation of Investment Property is a key
audit matter due to the:
•
Significance of the balance to the
financial statements (15% of total
assets);
•
Judgement applied by the Group in the
selection of the valuation methodology to
be used from those methodologies
available under accounting standards.
The adoption of alternative
methodologies may result in a different
valuation outcome;
•
Judgement required by the Group in
assessing the capitalisation rates applied
to the projected income of individual
properties in the income valuation
methodology. A small percentage
movement in the capitalisation rate
would result in a significant financial
impact to the investment property
balance and the income statement; and
•
Judgement required by the Group in
assessing any changes that may have
occurred since the timing of the
valuations performed by the Group’s
external valuer. It is the Group’s policy
when the external valuation was not
performed at year end for the directors to
assess and endorse the valuation to be
adopted in the financial report.
Our procedures included:
•
Assessing the Group’s policies for the valuation
of Investment Property against the
requirements of the accounting standards and
our understanding of the business.
•
Obtaining an understanding of the Group’s
process regarding the valuation of investment
property.
•
Assessing the scope, objectivity, and
competence of the Group’s external valuer.
•
Assessing the property valuation methodology
adopted by the Group.
•
Working with our real estate valuation
specialists, assessing the key assumptions in
the valuations for each of the properties against
accepted industry practices, using the nature of
the properties, and requirements of the
accounting standards;
•
Comparing the Group’s external valuations in
December 2023 to the director’s own
assessment of valuation at June 2024 and
where available, to recent sales evidence and
other published reporting relevant to the
Investment Property.
•
Challenging the capitalisation rates applied by
the Group, based on our knowledge of the
property portfolio and other published reports
of industry commentators.
•
Testing, on a sample basis, the following key
inputs to the valuations to existing lease
contracts, leasing schedules and published CPI
statistics by the Australian Bureau of Statistics:
–
Gross rent;
–
Occupancy rate;
–
Lease term remaining; and
–
CPI.
•
Assessing the disclosures in the financial
report, using our knowledge obtained from our
audit procedures, against accounting standards
requirements.
Carrying value of Inventories ($331.8million)
Refer to Notes 3(e) and 16 to the Financial Report
The key audit matter
How the matter was addressed in our audit
Valuation of inventories, being both completed
units and work in progress, is a key audit
matter due to the:
•
Significance of the balance to the financial
statements (47% of total assets);
•
Judgement and our effort applied to
assessing forecast selling prices and costs
of completion for work in progress. These
factors involve forecasting, which can add
audit complexity to the assessment of net
realisable value. It is the Group’s policy, in
accordance with accounting standards, that
inventory must be carried at the lower of
cost and net realisable value;
Selling prices can fluctuate based on
current property market conditions; and
Work in progress comprises developments
currently under construction and future
projects, which are long term in nature
where forecast costs could be negatively
impacted by issues encountered during
planning or construction.
Our procedures included:
•
Assessing the Group’s policies for the valuation of
inventories against the requirements of the
accounting standards and our understanding of
the business.
•
Challenging the Group’s assumptions of forecast
costs of completion for a sample of developments
under construction as well as future projects to
understand project design complexity, sub-
contractor reliance, project funding and other
project risks such as supplier cost increases.
These factors could impact costs of completion.
This was done through enquiry of senior
management, and assessment of the Group’s
underlying documentation such as budgets,
funding agreements, supplier contracts and
internal reports.
•
Testing a sample of inventory sales during the
year and subsequent to year end to executed
settlement statements to assess margins and
volumes achieved during and post the financial
year. This informed our evaluation of the carrying
value of inventories at balance date against the
Group’s policy for recording inventories at the
lower of cost and net realisable value.
•
Comparing forecast selling prices to total costs
incurred to date and forecast costs of completion
for significant projects. We did this to assess the
carrying value of inventories against the Group’s
policy for recording at the lower of cost and
forecast net realisable value.
•
Assessing the disclosures in the financial report,
using our knowledge obtained from our audit
procedures, against accounting standards
requirements.
Other Information
Other Information is financial and non-financial information in Finbar Group Limited’s annual report which
is provided in addition to the Financial Report and the Auditor’s Report. The Directors are responsible for
the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not
express an audit opinion or any form of assurance conclusion thereon, with the exception of the
Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In
doing so, we 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.
We are required to report if we conclude that there is a material misstatement of this Other Information,
and based on the work we have performed on the Other Information that we obtained prior to the date
of this Auditor’s Report we have nothing to report.
Responsibilities of the Directors for the Financial Report
The Directors are responsible for:
•
preparing the Financial Report in accordance with the Corporations Act 2001, including giving a
true and fair view of the financial position and performance of the Group, and in compliance with
Australian Accounting Standards and the Corporations Regulations 2001
•
implementing necessary internal control to enable the preparation of a Financial Report in
accordance with the Corporations Act 2001, including giving a true and fair view of the financial
position and performance of the Group, and that is free from material misstatement, whether due
to fraud or error
•
assessing the Group and Company’s ability to continue as a going concern and whether the use of
the going concern basis of accounting is appropriate. This includes disclosing, as applicable,
matters related to going concern and using the going concern basis of accounting unless they
either intend to liquidate the Group and Company or to cease operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
•
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 Australian Auditing Standards will always detect a material misstatement when it
exists.
Misstatements can arise from fraud or error. They 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 the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the Auditing
and Assurance Standards Board website at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our Auditor’s Report.
Report on the Remuneration Report
Opinion
In our opinion, the Remuneration Report
of Finbar Group Limited for the year
ended 30 June 2024, complies with
Section 300A of the Corporations Act
2001.
Directors’ 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 responsibilities
We have audited the Remuneration Report included in
paragraph 4.3 of the Directors’ report for the year ended
30 June 2024.
Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in
accordance with Australian Auditing Standards.
KPMG
Glenn Brooks
Partner
Perth
20 August 2024
KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated
with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and
logo are trademarks used under license by the independent member firms of the KPMG global organisation. Liability limited
by a scheme approved under Professional Standards Legislation.
Lead Auditor’s Independence Declaration under
Section 307C of the Corporations Act 2001
To the Directors of Finbar Group Limited
I declare that, to the best of my knowledge and belief, in relation to the audit of Finbar Group Limited for
the financial year ended 30 June 2024 there have been:
i.
no contraventions of the auditor independence requirements as set out in the Corporations
Act 2001 in relation to the audit; and
ii.
no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
Glenn Brooks
Partner
Perth
20 August 2024
SHAREHOLDINGS (as at 30 June 2024)
ASX ADDITIONAL INFORMATION
Additional information required by the ASX Limited Listing Rules and not disclosed elsewhere in this report is set out below.
Substantial Shareholders
The number of shares held by substantial shareholders and their associates are set out below:
Shareholder name
Number
%
Chuan Hup Holdings Limited
68,550,866
25.19
Forward International Pty Ltd
31,222,393
11.47
Thorney Holdings Proprietary Limited
28,743,116
10.56
Ordinary shares
Refer to Note 19 in the notes to the financial statements.
Distribution of Equity Security Holders
Range
Number of
Holders
Ordinary
Shares
1-1,000
394
102,284
1,001-5,000
404
1,171,367
5,001-10,000
269
2,074,925
10,001-100,000
672
21,432,995
100,001-over
153
247,341,571
1,892
272,123,142
The number of shareholders holding less than a marketable parcel of ordinary shares is 302.
Stock Exchange
The Company is listed on the Australian Securities Exchange. The home exchange is Perth.
ASX Code: FRI
Other Information
Finbar Group Limited, incorporated and domiciled in Australia, is a publicly listed company limited by shares.
104
ASX ADDITIONAL INFORMATION (Continued)
Twenty largest shareholders of ordinary shares as disclosed in the share register:
Number of
Ordinary
Shares Held
%
Chuan Hup Holdings Limited
63,871,363
23.47
UBS Nominees Pty Ltd
27,905,536
10.25
J P Morgan Nominees Australia Pty Limited
16,510,519
6.07
Rubino Group Pty Ltd (Rubino Group A/C)
9,030,000
3.32
Forward International Pty Ltd
8,261,109
3.04
Blair Park Pty Ltd
7,228,813
2.66
BNP Paribas Noms Pty Ltd
6,763,711
2.49
Mr James Chan
6,408,032
2.35
Citicorp Nominees Pty Limited
6,074,026
2.23
3RD Wave Investors Pty Ltd
6,000,000
2.20
Forward International Pty Ltd
5,671,492
2.08
Hanssen Pty Ltd
5,000,000
1.84
Mrs Siew Eng Mah
4,820,000
1.77
Chan Family Super (WA) Pty Ltd (Chan Family S/F A/C)
4,477,072
1.65
Mr Ah-Hwa Lim
3,155,770
1.16
Ms Yi Xian Chan
2,892,126
1.06
Apex Investments Pty Ltd
2,890,212
1.06
Denshir Pty Ltd
2,739,322
1.01
HSBC Custody Nominees (Australia) Limited
2,662,139
0.98
Pateman Equity Pty Ltd
2,543,844
0.93
TOP 20
194,905,086
71.62
105
2024 Finbar Group Limited Annual Report
106
2024 Finbar Group Limited Annual Report
OFFICES AND OFFICERS
Directors
Mr John Chan (Executive Chairman)
Mr Darren John Pateman (Managing Director)
Mr Ronald Chan (Chief Operations Officer)
Mr Terence Siong Woon Peh
Mr Eldon Wan
Company Secretary
Mr Edward Guy Bank (Chief Financial Officer)
Principal Registered Office
Finbar Group Limited
Level 6
181 Adelaide Terrace
EAST PERTH WA 6004
PO Box 3380
EAST PERTH WA 6892
Telephone: +61 8 6211 3300
Facsimile: +61 8 9221 8833
Email: info@finbar.com.au
Website: www.finbar.com.au
ABN 97 009 113 473
ACN 009 113 473
Share Registry
Computershare Investor Services Pty Ltd
Level 17
221 St Georges Terrace
PERTH WA 6000
Telephone: +61 8 9323 2000
Auditors
KPMG
235 St Georges Terrace
PERTH WA 6000
ASX ADDITIONAL INFORMATION (Continued)