A N N U A L
R E P O R T
21 Regal Place, East Perth, WA 6004 | Tel: (08) 9323 3300 | Fax: (08) 9202 1106 | info@fleetwood.com.au
ABN 69 009 205 261
CONTENTS
Corporate Directory .............................................. 2
Fleetwood Divisions .............................................. 3
5 Year Summary ...................................................... 4
Board of Directors & Executive Officers .... 5
Managing Director’s Review ............................ 6
Financial Report 2015 .......................................... 8
Directors’ Report .................................................. 44
CORPORATE
DIRECTORY
DELIVERING THE PROMISE
OUR OBJECTIVE
To outperform financially by
providing genuine value
OUR BELIEFS
We:
want to do business
build strong relationships in which each party wins
expect all parties to make and honour
their commitments
value the support of our shareholders,
clients and suppliers
OUR COMMITMENT
We will:
act with honesty and integrity
provide a safe and healthy workplace
operate in an environmentally responsible manner
develop and reward our people for their creativity
and dedication
deal with people in a concerned
and professional way
find better ways to do things
always hold ourselves accountable for
‘Delivering the Promise’
DIRECTORS
Michael Hardy
Greg Tate
Peter Gunzburg
John Bond
Brad Denison
COMPANY SECRETARY
Yanya O’Hara
AUDITOR
Grant Thornton
BANKER
Westpac Banking Corporation
REGISTERED OFFICE &
PRINCIPAL PLACE OF
BUSINESS
21 Regal Place
East Perth, WA 6004
T: (08) 9323 3300
F: (08) 9202 1106
E: info@fleetwood.com.au
SHARE REGISTRY
Computershare
Level 11,
172 St Georges Terrace
Perth, WA 6000
T: (08) 9323 2000
F: (08) 9323 2033
E: info@computershare.com.au
2
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
MANUFACTURED ACCOMMODATION
Accommodation solutions provider to the resources, education and
affordable housing sectors. Headquarters in Perth and Melbourne with
operations in WA, NT, Qld, Vic and NSW.
RECREATIONAL VEHICLES
Manufacturer and distributor of parts and accessories
to the recreational vehicles industry in Australia and NZ.
Headquartered in Melbourne with branches in NSW,
Queensland, Victoria, WA and NZ.
Manufacturer of caravans, pop-tops and campers distributed
through a national dealer network. Headquarters and main
operations in Perth.
Distributor of ute trays and
accessories. Headquartered
in Sydney with distributors
throughout NSW.
Distributor of canopies and
trays for commercial vehicles.
Headquartered in Melbourne
with branches and dealers
across Australia.
3
FLEETWOOD CORPORATIONANNUAL REPORT 2015 FIVE YEAR SUMMARY
$ million (unless stated)
2015
2014
2013
2012
2011
Revenue
301.9
366.5
333.9
382.6
466.6
Earnings before interest, tax, depreciation, and amortisation*
38.4
28.2
40.5
94.2
89.5
EBITDA margin*
12.7%
7.7%
12.1%
24.6%
19.2%
Depreciation and amortisation
29.1
17.6
16.1
14.9
14.0
Earnings before interest and tax (EBIT)*
9.3
10.6
24.5
79.3
75.4
EBIT margin*
Finance costs
Operating profit before income tax
Operating profit after tax
Interest cover (times)
Earnings per share (cents)
Dividends per share (cents)
Assets
Liabilities
Shareholders funds
Return on equity
Debt
3.1%
2.9%
7.3%
20.7%
16.2%
4.0
0.9
0.2
1.2
0.3
0.0
2.2
1.3
0.8
1.8
3.4
23.2
78.5
73.6
0.6
16.6
55.2
51.3
2.5
19.3
103.8
41.6
0.9
27.8
93.8
90.0
4.0
30.0
76.0
73.0
327.7
321.8
312.6
289.8
307.5
113.7
107.4
98.5
58.6
101.2
214.0
214.4
214.1
231.2
206.2
0.1%
0.3%
7.8%
24.0%
25.0%
62.5
62.4
44.6
0.9
21.3
Debt / Shareholders funds %
29%
29%
21%
0%
10%
Cash flows from operations
42.2
30.9
25.4
77.3
51.8
Number of shares on issue (million)
61.0
60.6
60.5
59.2
57.8
All numbers exclude discontinued operations
*Excludes impairment
4
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
BOARD OF DIRECTORS
& EXECUTIVE OFFICERS
4
JOHN BOND
Non-Executive Director
B Juris, L LB, B Comm
Age 59 lives in Perth
John became a non-executive director
in 2013. John has been a director of
Primewest Management Ltd since 2000,
and as a professional property investor,
he has over 20 years’ experience in
negotiating acquisitions, overseeing the
development of properties and asset
management. John is currently a chairman
of the Fathering Project.
5
BRAD DENISON
Managing Director
Fellow Certified Practising Accountant
Bachelor of Commerce
Age 43 lives in Perth
Brad was appointed Managing Director in
August 2014. Prior to this, Brad was Chief
Financial Officer and Company Secretary
for 10 years. Before joining Fleetwood,
Brad was employed in senior public
company finance roles.
6
YANYA O’HARA
Company Secretary
Lawyer
LL B (Hon), LL M
Yanya was appointed as Company
Secretary on 1 August 2014. Prior to this,
Yanya was employed by the Company
for three years as Assistant Company
Secretary. Prior to joining Fleetwood,
Yanya practiced as a corporate attorney
in New York and as barrister and solicitor
in Perth.
1
MICHAEL HARDY
Chairman
Non-Executive Director
Barrister & Solicitor
B Juris LLB BA
Age 62 lives in Perth
Appointed to the board in 2005. Michael
was a partner of Clayton Utz (formerly
Robinson Cox) from 1983 to 2002 before
establishing the firm Hardy Bowen.
2
GREG TATE
Non-Executive Director
Chartered Accountant
B Comm
Age 63 lives in Perth
Greg was appointed a non-executive
director during listing of the company in
1987 and became managing director in
1990. He relinquished this role to become
Executive Director of Operations in 2007.
Greg retired from his executive position in
December 2010. Prior to joining Fleetwood
he founded a chartered accountancy
practice after being employed in Australia
and the USA by Deloitte.
3
PETER GUNZBURG
Non-Executive Director
B Comm
Age 63 lives in Perth
Mr Gunzburg was appointed to the board
of Fleetwood in 2002.
Mr Gunzburg has over 20 years’
experience as a stockbroker. He has a
commerce degree from the University of
Western Australia and has previously been
a director of Resolute Limited, Australian
Stock Exchange Limited, Eyres Reed
Limited and CIBC World Markets Australia
Limited, Strike Oil Limited and Matra
Petroleum Plc.
He is currently Executive Chairman of
Eurogold Limited and Non-Executive
Chairman of Newzulu Limited.
1
2
3
4
5
6
FLEETWOOD CORPORATION
AN NU AL R EPO RT 2 015 5
MANAGING DIRECTOR’S REVIEW
Revenue down 18% to $301.9m
•
• EBIT down 12% to $9.3m, excluding impairment charge of $4.5m
• Effectively debt free at completion of Osprey transaction
A positive negotiation outcome with the Western Australian Department of Housing on the Osprey key workers village
(Osprey Village) and incremental volume from the east coast affordable housing market were offset by challenging
conditions in caravan manufacturing and reduced demand in the Western Australian accommodation sector.
Conversely, impairment charges have been recognised in respect of intangible assets in caravan manufacturing and idle
rental fleet stock in Western Australia.
Notwithstanding difficult conditions, Fleetwood continued to generate very strong operating cash flows with a 36%
increase on 2014 to $42.2m.
The company became effectively debt free in July 2015 upon the sale of the Osprey Village to the Western Australian
Department of Housing.
MANUFACTURED ACCOMMODATION
While education demand remained strong in Victoria, demand in
Western Australia and Queensland fell due to completion of programs
to move Year 7 students into high school in 2014.
Construction of the Osprey Village was completed in 2014 and
as a consequence manufacturing volume in the West Australian
accommodation business fell in 2015. An interim license agreement
provided an income stream during the year.
$ million
2015 2014 % change
Revenue
189.6 229.7
-17.5%
EBIT
18.5*
16.0
16.1%
*excludes impairment charge of $1.3m.
Occupancy at Searipple Village in Karratha increased steadily during the year following execution of a three year preferred
supplier agreement with Rio Tinto in February 2015. Average occupancy in the second half was 41%, and at the date
of this report is approximately 60%.
Fleetwood executed a two year exclusive manufactured homes supply agreement with Gateway Lifestyle in May 2015.
Gateway presently has 36 parks located in Queensland and New South Wales, with 1,815 sites available for development.
Fleetwood will manufacture the homes at its existing facility in Brisbane and a new facility in Newcastle, New South
Wales, which commenced operations in July 2015.
RECREATIONAL VEHICLES
While a number of initiatives were implemented to address
performance issues in caravan manufacturing during 2015, these
are yet to manifest in improved profitability.
Overseas supply increased at Camec during the year, with a number
of new product lines being introduced. Sales of the new lines have
increased steadily, although competitive pressure has affected
volume for some existing products.
$ million
2015 2014 % change
Revenue
112.2 136.5
-17.8%
EBIT
-7.0*
-2.1*
-229.7%
*excludes impairment charge of $3.2m ($5.0m
in 2014).
The acquisition of Bocar in August 2014 has increased Fleetwood market share in the aluminium tray market. In
addition, completion of the transition to overseas manufacturing for Flexiglass has allowed the business to be
simplified and profitability improved.
A number of key senior management changes have recently been made in the recreational vehicles division. The
changes are aimed at ensuring successful implementation of initiatives to address performance concerns.
6
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
DIVIDENDS
Given the mixed trading conditions, the directors have deemed it
prudent not to pay a final dividend for 2015.
Subject to trading conditions and capital expenditure requirements
the directors intend to return to paying dividends as soon as
practicable.
SUSTAINABILITY
Fleetwood is committed to reducing its environmental footprint
where possible. Refinements have recently been made to the
company’s waste water treatment plant at Searipple Village in
Karratha, with the plant now treating 65% of waste water from
the Village for use in reticulating gardens. This saves approximately
18,000 kilo litres of water per annum from entering the municipal sewer.
PEOPLE
Dividend History (cents)
73
76
30
4
2011
2012
2013
2014
0
2015
2015 has been another challenging year for Fleetwood. Difficult trading conditions in some areas and taking
advantage of new markets required our people to extend themselves. On behalf of the directors, I sincerely thank
our people for rising to meet these challenges.
OUTLOOK
Following the sale of Osprey Village to the Western Australian Department of Housing in July 2015, Fleetwood will
continue to manage the village and receive a guaranteed income stream for a period of fourteen years.
The three year preferred supplier agreement with Rio Tinto will contribute to stable occupancy at Searipple Village
in 2016. Under the terms of the agreement, Rio Tinto has access to 804 rooms, leaving 472 rooms available for
Fleetwood to market to other clients.
Education demand is expected to continue to be strong in Victoria, supported by Fleetwood’s reappointment in
August 2015 to the panel of contractors providing relocation services to the Victorian Department of Education and
Training. In September 2015 Fleetwood was appointed to a panel of contractors supplying new classrooms to the
Victorian Department of Education and Training and an initial order was received for 58 new classrooms with a value
of $16m.
Fleetwood will experience a full year of manufactured home production for Gateway Lifestyle in the 2016 financial
year. The company is also exploring opportunities to expand further in this market segment, particularly in New
South Wales and Western Australian.
Trading conditions in the Western Australian accommodation sector remain challenging. Significant focus is being
applied to developing income streams from new markets following the downturn in the mining sector.
Bocar imports a quality aluminium tray product with a compelling value proposition and further synergies are
expected in 2016.
A fresh approach to product design is expected to increase consumer appeal for Fleetwood caravans, while allowing
for manufacturing economies to be realised. Fleetwood has recently increased its dealer presence in the Victorian
market and is presently exploring opportunities in New South Wales.
Competition remains strong in the component parts market and initiatives to streamline Camec’s distribution
operations are being undertaken.
In conclusion while operations exposed to the education and affordable housing sectors are experiencing strong
demand presently, profits generated will be offset by weakness in caravan manufacturing and mining services in the
first half of 2016.
7
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Consolidated statement of profit or loss
and other comprehensive income
Fleetwood Corporation Limited
Year ended 30 June 2015
Continuing operations
Sales revenue
Other income
Materials used
Sub-contract costs
Employee benefits
Operating leases
Impairment of non-current assets
Other expenses
Profit before interest, tax, depreciation and amortisation (EBITDA)
Depreciation and amortisation
Profit before interest and tax (EBIT)
Finance costs
Profit before incom e tax expense
Income tax expense
Profit from continuing operations
Loss from discontinued operation
Profit for the year
Other com prehensive incom e
Items that may subsequently be reclassified to profit or loss
Net exchange difference relating to foreign controlled entities (net of tax)
Total com prehensive incom e for the year
Earnings per share from continuing and discontinued operations
Diluted earnings per share (cents)
Basic earnings per share (cents)
Earnings per share from continuing operations
Diluted earnings per share (cents)
Basic earnings per share (cents)
To be read in conjunction with the accompanying notes.
8
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Not e
2
2
3
3
4
35
25
24
7
7
7
7
2015
$ '000
2014
$ '000
302,000
366,289
(65)
229
(101,525)
(146,573)
(68,181)
(90,935)
(58,366)
(66,181)
(10,712)
(11,173)
(4,477)
(5,000)
(24,708)
(23,430)
33,966
23,226
(29,113)
(17,624)
4,853
5,602
(3,959)
(2,227)
894
(718)
176
-
176
3,375
(2,809)
566
(490)
76
(38)
138
359
435
0.3
0.3
0.3
0.3
0.1
0.1
0.9
0.9
Consolidated statement of profit or loss
and other comprehensive income
Fleetwood Corporation Limited
Year ended 30 June 2015
Consolidated statement of financial position
Fleetwood Corporation Limited
As at 30 June 2015
Continuing operations
Sales revenue
Other income
Materials used
Sub-contract costs
Employee benefits
Operating leases
Impairment of non-current assets
Other expenses
Depreciation and amortisation
Profit before interest and tax (EBIT)
Finance costs
Profit before incom e tax expense
Income tax expense
Profit from continuing operations
Loss from discontinued operation
Profit for the year
Profit before interest, tax, depreciation and amortisation (EBITDA)
Other com prehensive incom e
Items that may subsequently be reclassified to profit or loss
Net exchange difference relating to foreign controlled entities (net of tax)
Total com prehensive incom e for the year
Earnings per share from continuing and discontinued operations
Diluted earnings per share (cents)
Basic earnings per share (cents)
Earnings per share from continuing operations
Diluted earnings per share (cents)
Basic earnings per share (cents)
To be read in conjunction with the accompanying notes.
Not e
2
2
3
3
4
35
25
24
7
7
7
7
2015
$ '000
2014
$ '000
302,000
366,289
(65)
229
(101,525)
(146,573)
(68,181)
(90,935)
(58,366)
(66,181)
(10,712)
(11,173)
(4,477)
(5,000)
(24,708)
(23,430)
33,966
23,226
(29,113)
(17,624)
4,853
5,602
(3,959)
(2,227)
894
(718)
176
-
176
3,375
(2,809)
566
(490)
76
(38)
138
359
435
0.3
0.3
0.3
0.3
0.1
0.1
0.9
0.9
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other financial assets
Non-current assets held for sale
Tax assets
Total current assets
Non-current assets
Property, plant and equipment
Inventories
Goodwill
Intangible assets
Deferred tax assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Interest bearing liabilities
Tax liabilities
Provisions
Other financial liabilities
Total current liabilities
Non-current liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Retained earnings
Total equity
To be read in conjunction with the accompanying notes.
Note
8
9
10
11
12
13
10
14
15
4
16
18
17
21
17
23
24
25
2015
$ '000
6,634
96,197
45,246
206
-
-
2014
$ '000
6,405
46,654
44,504
-
51
55
148,283
97,669
107,676
109,702
-
61,761
5,166
4,822
45,745
59,431
4,844
4,396
179,425
224,118
327,708
321,787
43,672
62,500
959
5,605
-
37,853
62,411
-
5,837
139
112,736
106,240
971
971
1,138
1,138
113,707
107,378
214,001
214,409
194,762
194,096
(257)
19,496
(219)
20,532
214,001
214,409
9
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Consolidated statement of changes in equity
Fleetwood Corporation Limited
Year ended 30 June 2015
Balance 1 July 2013
Profit for the year
Exchange differences arising on translation of foreign operations
Total comprehensive income for the year
Dividends paid
Share-based payments
Balance at 30 June 2014
Profit for the year
Exchange differences arising on translation of foreign operations
Total comprehensive income for the year
Dividends paid
Share-based payments
Balance at 30 June 2015
To be read in conjunction with the accompanying notes.
Foreign
currency
translation
reserve
$ '000
Issued
capital
$ '000
Retained
earnings
$ '000
Total
$ '000
193,001
(578)
21,668
214,091
-
-
-
150
945
-
359
359
-
-
76
-
76
76
359
435
(1,212)
(1,062)
-
945
194,096
(219)
20,532
214,409
-
-
-
198
468
-
(38)
(38)
-
-
176
-
176
176
(38)
138
(1,212)
(1,014)
-
468
194,762
(257)
19,496
214,001
10
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Consolidated statement of changes in equity
Fleetwood Corporation Limited
Year ended 30 June 2015
Exchange differences arising on translation of foreign operations
Total comprehensive income for the year
Balance 1 July 2013
Profit for the year
Dividends paid
Share-based payments
Balance at 30 June 2014
Profit for the year
Dividends paid
Share-based payments
Balance at 30 June 2015
Exchange differences arising on translation of foreign operations
Total comprehensive income for the year
To be read in conjunction with the accompanying notes.
Foreign
currency
Issued
translation
capital
$ '000
reserve
$ '000
Retained
earnings
$ '000
Total
$ '000
193,001
(578)
21,668
214,091
(1,212)
(1,062)
194,096
(219)
20,532
214,409
-
-
-
-
-
-
150
945
198
468
359
359
(38)
(38)
-
-
-
-
-
-
76
76
-
-
-
-
176
176
(1,212)
(1,014)
194,762
(257)
19,496
214,001
76
359
435
945
176
(38)
138
468
Consolidated statement of cash flows
Fleetwood Corporation Limited
Year ended 30 June 2015
Cash flows from operating activities
Receipts in the course of operations
Payments in the course of operations
Interest received
Income taxes paid
Finance costs paid
Note
2015
$ '000
2014
$ '000
327,500
415,906
(281,320)
(378,631)
75
(129)
(3,959)
120
(4,224)
(2,227)
Net cash provided by operating activities
29.1
42,167
30,944
Cash flows from investing activities
Acquisition of property, plant and equipment
Proceeds from sale of non-current assets
Payment for acquisition of subsidiary
Payment for intangible assets
Payment for capital work in progress
Net cash used in investing activities
Cash flows from financing activities
Proceeds from borrowings
Repayment of borrowings
Dividends paid
34
Net cash provided by financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effect of exchange rate changes on the balance of cash held in foreign currencies
Cash and cash equivalents at the end of the financial year
8
To be read in conjunction with the accompanying notes.
(33,556)
(21,289)
120
(4,915)
(2,653)
-
844
-
(2,813)
(30,718)
(41,004)
(53,976)
56,989
(56,900)
(1,014)
(925)
238
47,390
(29,600)
(1,062)
16,728
(6,304)
6,405
12,665
(9)
6,634
44
6,405
11
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Notes to the financial statements
Fleetwood Corporation Limited
Year ended 30 June 2015
1 Statement of significant accounting policies
The significant policies which have been adopted in the preparation of this financial report are:
1.1 Statement of compliance
The financial report is a general purpose financial report which has been prepared in accordance with the Corporations Act 2001 (Cth),
Accounting Standards and Interpretations, and complies with other requirements of the law. Compliance with Australian Accounting
Standards ensures the consolidated financial statements and notes of the consolidated entity comply with International Financial
Reporting Standards. The Company is a for profit entity and the financial statements comprise the consolidated financial statements of
the Group.
The financial statements were authorised for issue by the directors on 30 September 2015.
The Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board
(AASB) that are relevant to its operations and effective for the current annual reporting period. Adoption of these standards has had no
effect on the amounts reported for the current or prior period.
At the date of authorisation of the financial statements, the following applicable standards and interpretations were in issue but not yet
effective:
Standard
AASB 9 ‘Financial Instruments’, and the relevant amending standards
Effective for
reporting periods
beginning on or
after:
Expected to
be applied in
the year
ending:
1 January 2018
30 June 2019
AASB 15 ‘Revenue from Contracts with Customers’
1 January 2017
30 June 2018
AASB 2014-3 ‘Amendments to Australian Accounting Standards – Accounting for
Acquisitions of Interests in Joint Operations’
AASB 2014-4 ‘Amendments to Australian Accounting Standards – Clarification of
Acceptable Methods of Depreciation and Amortisation’
AASB 2014-9 ‘Amendments to Australian Accounting Standards – Equity Method in
Separate Financial Statements’
1 January 2016
30 June 2017
1 January 2016
30 June 2017
1 January 2016
30 June 2017
AASB 2014-10 ‘Amendments to Australian Accounting Standards – Sale or Contribution of
Assets between an Investor and its Associate or Joint Venture’
1 January 2016
30 June 2017
The Group is yet to undertake a detailed assessment of the impact of AASB 15 and AASB 9. However, based on the entity’s preliminary
assessment, the Standards are not expected to have a material impact on the transactions and balances recognised in the financial
statements when first adopted for the year ending 30 June 2018 and 30 June 2019, respectively.
Management are in the process of determining the potential impact of the initial application of the Standards and Interpretations. These
Standards and Interpretations will be first applied in the financial report of the Group that relates to the annual reporting period
beginning on or after the effective date of each pronouncement.
1.2 Basis of preparation
The financial report has been prepared on the basis of historical costs, except for certain non-current assets and financial instruments
that are measured at revalued amounts or fair values, as explained in the accounting policies below. Cost is generally based on the fair
values of the consideration given in exchange for assets. Fair value is the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is
directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Group takes
into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing
the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial
statements is determined on such a basis, except for share-based payment transactions that are within the scope of AASB 2, leasing
transactions that are within the scope of AASB 117, and measurements that have some similarities to fair value but are not fair value,
such as net realisable value in AASB 2 or value in use in AASB 136. Accounting policies have been consistently applied and except
where there are changes in accounting policy, are consistent with those of the previous year. All amounts are presented in Australian
Dollars unless otherwise noted.
The Company is of the kind referred to in ASIC Class Order 98/0100, dated 10 July 1998, and in accordance with that Class Order
amounts in the financial report are rounded off to the nearest thousand dollars, unless otherwise indicated.
1.3 Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its
subsidiaries). Control is achieved when the Company has power over the investee, is exposed, or has rights, to variable returns from its
involvement with the investee, and has the ability to use its power to affect its returns. The Company reassesses whether or not it
controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control.
When the Company has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are
sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Company considers all relevant
facts and circumstances in assessing whether or not the Company's voting rights in an investee are sufficient to give it power, including
the size of the Company's holding of voting rights relative to the size and dispersion of holdings of the other vote holders, potential
voting rights held by the Company, other vote holders or other parties, rights arising from other contractual arrangements, and any
12
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Notes to the financial statements
Fleetwood Corporation Limited
Year ended 30 June 2015
1 Statement of significant accounting policies
The significant policies which have been adopted in the preparation of this financial report are:
1.1 Statement of compliance
The financial report is a general purpose financial report which has been prepared in accordance with the Corporations Act 2001 (Cth),
Accounting Standards and Interpretations, and complies with other requirements of the law. Compliance with Australian Accounting
Standards ensures the consolidated financial statements and notes of the consolidated entity comply with International Financial
Reporting Standards. The Company is a for profit entity and the financial statements comprise the consolidated financial statements of
The financial statements were authorised for issue by the directors on 30 September 2015.
The Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board
(AASB) that are relevant to its operations and effective for the current annual reporting period. Adoption of these standards has had no
effect on the amounts reported for the current or prior period.
the Group.
effective:
Standard
Effective for
Expected to
reporting periods
be applied in
beginning on or
after:
the year
ending:
1 January 2018
30 June 2019
AASB 9 ‘Financial Instruments’, and the relevant amending standards
AASB 15 ‘Revenue from Contracts with Customers’
1 January 2017
30 June 2018
AASB 2014-3 ‘Amendments to Australian Accounting Standards – Accounting for
Acquisitions of Interests in Joint Operations’
AASB 2014-4 ‘Amendments to Australian Accounting Standards – Clarification of
Acceptable Methods of Depreciation and Amortisation’
AASB 2014-9 ‘Amendments to Australian Accounting Standards – Equity Method in
Separate Financial Statements’
1 January 2016
30 June 2017
1 January 2016
30 June 2017
1 January 2016
30 June 2017
AASB 2014-10 ‘Amendments to Australian Accounting Standards – Sale or Contribution of
Assets between an Investor and its Associate or Joint Venture’
1 January 2016
30 June 2017
The Group is yet to undertake a detailed assessment of the impact of AASB 15 and AASB 9. However, based on the entity’s preliminary
assessment, the Standards are not expected to have a material impact on the transactions and balances recognised in the financial
statements when first adopted for the year ending 30 June 2018 and 30 June 2019, respectively.
Management are in the process of determining the potential impact of the initial application of the Standards and Interpretations. These
Standards and Interpretations will be first applied in the financial report of the Group that relates to the annual reporting period
beginning on or after the effective date of each pronouncement.
1.2 Basis of preparation
The financial report has been prepared on the basis of historical costs, except for certain non-current assets and financial instruments
that are measured at revalued amounts or fair values, as explained in the accounting policies below. Cost is generally based on the fair
values of the consideration given in exchange for assets. Fair value is the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is
directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Group takes
into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing
the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial
statements is determined on such a basis, except for share-based payment transactions that are within the scope of AASB 2, leasing
transactions that are within the scope of AASB 117, and measurements that have some similarities to fair value but are not fair value,
such as net realisable value in AASB 2 or value in use in AASB 136. Accounting policies have been consistently applied and except
where there are changes in accounting policy, are consistent with those of the previous year. All amounts are presented in Australian
Dollars unless otherwise noted.
The Company is of the kind referred to in ASIC Class Order 98/0100, dated 10 July 1998, and in accordance with that Class Order
amounts in the financial report are rounded off to the nearest thousand dollars, unless otherwise indicated.
1.3 Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its
subsidiaries). Control is achieved when the Company has power over the investee, is exposed, or has rights, to variable returns from its
involvement with the investee, and has the ability to use its power to affect its returns. The Company reassesses whether or not it
controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control.
When the Company has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are
sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Company considers all relevant
facts and circumstances in assessing whether or not the Company's voting rights in an investee are sufficient to give it power, including
the size of the Company's holding of voting rights relative to the size and dispersion of holdings of the other vote holders, potential
voting rights held by the Company, other vote holders or other parties, rights arising from other contractual arrangements, and any
additional facts and circumstances that indicate that the Company has, or does not have, the current ability to direct the relevant
activities at the time that decisions need to be made, including voting patterns at previous shareholders' meetings.
Income and expense of subsidiaries acquired or disposed of during the year are included in the consolidated statement of profit or loss
and other comprehensive income from the effective date of acquisition and up to the effective date of disposal, as appropriate. Total
comprehensive income of subsidiaries is attributed to the owners of the Company even if this results in the non-controlling interests
having a deficit balance.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with those
used by other members of the Group. All intra-group transactions, balances, income and expenses are eliminated on consolidation.
When the Group loses control of a subsidiary, a gain or loss is recognised in the profit or loss and is calculated as the difference
between (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous
carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests. When assets of the
subsidiary are carried at revalued amounts or fair values and the related cumulative gain or loss has been recognised in other
comprehensive income and accumulated in equity, the amounts previously recognised in other comprehensive income and
accumulated in equity are accounted for as if the Group had directly disposed of the relevant assets (i.e. reclassified to profit or loss or
transferred directly to retained earnings as specified by applicable Standards). The fair value of any investment retained in the former
subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under AASB 139
‘Financial Instruments: Recognition and Measurement’ or, when applicable, the cost on initial recognition of an investment in an
associate.
At the date of authorisation of the financial statements, the following applicable standards and interpretations were in issue but not yet
1.4 Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is
measured at fair value which is calculated as the sum at the acquisition-date of the fair values of assets transferred by the Company,
liabilities incurred by the Company to the former owners of the acquiree and the equity instruments issued by the Company in exchange
for control of the acquiree. Acquisition related costs are recognised in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value, except that deferred
tax assets or liabilities or assets related to employment benefit arrangements are recognised and measured in accordance with AASB
112 ‘Income Taxes’ and AASB 119 ‘Employee Benefits’ respectively.
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the
acquiree, and the fair value of the acquirer's previously held equity interest in the acquiree (if any) over the net of the acquisition date
amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition date amounts
of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-
controlling interests in the acquiree and the fair value of the acquirer's previously held interest in the acquiree (if any), the excess is
recognised immediately in profit or loss as a bargain purchase gain.
1.5 Revenue recognition
Revenue is recognised at the fair value of consideration received or receivable net of goods and services tax (GST).
Sale of goods
Revenue from the sale of goods is recognised when the goods are delivered and titles have passed, at which time all the following
conditions are satisfied:
the Group has transferred to the buyer the significant risks and rewards of ownership of the goods;
the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective
control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the economic benefits associated with the transaction will flow to the Group; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Construction contracts
When the stage of completion can be reliably measured, revenue is recognised in proportion to the stage of completion of the contract.
The stage of completion is measured based on the proportion of costs incurred for work performed to date relative to the estimated total
contract cost. Variations in contract work, claims and incentive payments are included to the extent that the amount can be reliably
measured and its receipt is considered probable. Where the outcome of a contract cannot be reliably estimated, costs are immediately
recognised as an expense. Where it is probable costs will not be recovered, revenue is only recognised to the extent costs are
recoverable. An expected loss is recognised immediately as an expense.
When costs incurred to date plus recognised profits less recognised losses exceed progress billings, the surplus is shown as amounts
due from customers for contract work. For contracts where progress billings exceed costs incurred to date plus recognised profits less
recognised losses, the surplus is shown as the amounts due to customers for contract work. Amounts received before the related work
is performed are included in the consolidated statement of financial position, as a liability. Amounts billed for work performed but not yet
paid are included in the consolidated statement of financial position as trade and other receivables.
Rental
Rental income is recognised on a straight line basis over the term of the relevant rental contract.
Interest
Interest is recognised on an accrual basis, taking into account the effective yield on the financial asset.
Sale of non-current assets
Gains or losses on sale of non-current assets are included as income or expenses at the date the significant risks and rewards of the
asset pass to the buyer, usually when an unconditional contract of sale is signed. The gain or loss on disposal is calculated as the
difference between the carrying amount of the asset at the time of disposal and the net proceeds on disposal.
Dividends
Dividends and distributions from subsidiaries are recognised by the parent entity when they are declared by the subsidiaries. Dividends
received out of pre-acquisition reserves are eliminated against the carrying amount of the investment and not recognised as revenue.
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FLEETWOOD CORPORATIONANNUAL REPORT 2015 1.6 Foreign currency
Functional currency
The individual financial statements of each group entity are presented in the currency of the primary economic environment in which the
entity operates (its functional currency). The results and financial position of each group entity are expressed in Australian Dollars (‘$’),
which is the functional currency of the Company and the presentation currency for the consolidated financial statements.
Transactions
Foreign currency transactions are translated to Australian currency at the rates of exchange ruling at the dates of the transactions.
Amounts receivable and payable in foreign currencies at balance date are translated at the rate of exchange ruling on that date.
Exchange differences relating to amounts payable and receivable in foreign currencies are brought to account as exchange gains or
losses in the statement of comprehensive income in the financial year in which they arose.
Translation of controlled foreign operations
The assets and liabilities of foreign operations, including subsidiaries, are translated at the rates of exchange ruling at balance date.
Equity items are translated at historical rates. Exchange differences arising from translation are taken directly to the foreign currency
reserve until disposal or partial disposal of the operations.
Income and expense items are translated at the average exchange rates for
the period. Exchange differences are recognised in other comprehensive income and accumulated in equity.
1.7 Goods and services tax
Revenues, expenses and assets are recognised net of goods and services tax (GST), except where the amount of GST incurred is not
recoverable from the taxation authority. In these circumstances, GST is recognised as part of the cost of acquisition of the asset or as
part of an item of expense.
Receivables and payables are stated with the amount of GST included. The net GST recoverable from, or payable to, the taxation
authority is included as a current asset or liability in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis. The GST component of cash flows arising from investing and
financing activities, which are recoverable from, or payable to, the taxation authority are classified as operating cash flows.
1.8 Taxation
Current tax
Current tax is calculated by reference to the amount of income tax payable or recoverable in respect of the taxable profit or loss for the
period. It is calculated using tax rates and tax laws that have been enacted or substantively enacted by the reporting date. Current tax
for current and prior periods is recognised as a liability or asset to the extent that it is unpaid or refundable.
Taxable profit differs from profit before tax as reported in the consolidated statement of profit or loss and other comprehensive income
because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible.
Deferred tax
Deferred tax is accounted for using the comprehensive statement of financial position liability method in respect of temporary
differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax base of those
items.
In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent
that it is probable that a sufficient taxable amount will be available against which deductible temporary differences or unused tax losses
and tax offsets can be utilised. Deferred tax assets and liabilities are not recognised if the temporary differences arise from the initial
recognition of assets and liabilities (other than as a result of a business combination) which affects neither taxable income nor
accounting profit. Furthermore, a deferred tax liability is not recognised in relation to taxable differences arising from goodwill.
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries and associates, and
interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences
associated with such investments and interests are only recognised to the extent that it is probable that there will be sufficient taxable
profits against which to utilise the benefits of the temporary differences and they are expected to reverse in the foreseeable future.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the assets and the
liabilities giving rise to them are realised or settled, based on tax rates and tax laws that have been enacted or substantively enacted by
the reporting date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the
manner in which the consolidated entity expects, at the reporting date, to recover or settle the carrying amount of its assets and
liabilities.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax assets and liabilities
are offset when they relate to income taxes levied by the same taxation authority and the company/consolidated entity intends to settle
its current tax assets and liabilities on a net basis.
Current and deferred tax for the period
Current and deferred tax is recognised as an expense or income in the statement of comprehensive income, except when it relates to
items credited or debited directly to equity, in which case the deferred tax is also recognised directly in equity, or where it arises from the
initial accounting for a business combination, in which case it is taken into account in the determination of goodwill.
1.9 Cash and cash equivalents
Cash comprises cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily
convertible to known amounts of cash, which are subject to an insignificant risk of changes in fair value and have a maturity of three
months or less at the date of acquisition.
1.10 Acquisition of assets
All assets including property, plant and equipment and intangibles are initially recorded at their cost at the date of acquisition, being the
fair value of the consideration provided plus incidental costs directly attributable to the acquisition. The costs of assets constructed or
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FLEETWOOD CORPORATION
ANNUAL REPORT 2015
1.6 Foreign currency
Functional currency
Transactions
The individual financial statements of each group entity are presented in the currency of the primary economic environment in which the
entity operates (its functional currency). The results and financial position of each group entity are expressed in Australian Dollars (‘$’),
which is the functional currency of the Company and the presentation currency for the consolidated financial statements.
Foreign currency transactions are translated to Australian currency at the rates of exchange ruling at the dates of the transactions.
Amounts receivable and payable in foreign currencies at balance date are translated at the rate of exchange ruling on that date.
Exchange differences relating to amounts payable and receivable in foreign currencies are brought to account as exchange gains or
losses in the statement of comprehensive income in the financial year in which they arose.
Translation of controlled foreign operations
The assets and liabilities of foreign operations, including subsidiaries, are translated at the rates of exchange ruling at balance date.
Equity items are translated at historical rates. Exchange differences arising from translation are taken directly to the foreign currency
reserve until disposal or partial disposal of the operations.
Income and expense items are translated at the average exchange rates for
the period. Exchange differences are recognised in other comprehensive income and accumulated in equity.
1.7 Goods and services tax
part of an item of expense.
Revenues, expenses and assets are recognised net of goods and services tax (GST), except where the amount of GST incurred is not
recoverable from the taxation authority. In these circumstances, GST is recognised as part of the cost of acquisition of the asset or as
Receivables and payables are stated with the amount of GST included. The net GST recoverable from, or payable to, the taxation
authority is included as a current asset or liability in the statement of financial position.
Cash flows are included in the statement of cash flows on a gross basis. The GST component of cash flows arising from investing and
financing activities, which are recoverable from, or payable to, the taxation authority are classified as operating cash flows.
1.8 Taxation
Current tax
Deferred tax
items.
Current tax is calculated by reference to the amount of income tax payable or recoverable in respect of the taxable profit or loss for the
period. It is calculated using tax rates and tax laws that have been enacted or substantively enacted by the reporting date. Current tax
for current and prior periods is recognised as a liability or asset to the extent that it is unpaid or refundable.
Taxable profit differs from profit before tax as reported in the consolidated statement of profit or loss and other comprehensive income
because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible.
Deferred tax is accounted for using the comprehensive statement of financial position liability method in respect of temporary
differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax base of those
In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent
that it is probable that a sufficient taxable amount will be available against which deductible temporary differences or unused tax losses
and tax offsets can be utilised. Deferred tax assets and liabilities are not recognised if the temporary differences arise from the initial
recognition of assets and liabilities (other than as a result of a business combination) which affects neither taxable income nor
accounting profit. Furthermore, a deferred tax liability is not recognised in relation to taxable differences arising from goodwill.
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries and associates, and
interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences
associated with such investments and interests are only recognised to the extent that it is probable that there will be sufficient taxable
profits against which to utilise the benefits of the temporary differences and they are expected to reverse in the foreseeable future.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the assets and the
liabilities giving rise to them are realised or settled, based on tax rates and tax laws that have been enacted or substantively enacted by
the reporting date. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the
manner in which the consolidated entity expects, at the reporting date, to recover or settle the carrying amount of its assets and
liabilities.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax assets and liabilities
are offset when they relate to income taxes levied by the same taxation authority and the company/consolidated entity intends to settle
its current tax assets and liabilities on a net basis.
Current and deferred tax for the period
Current and deferred tax is recognised as an expense or income in the statement of comprehensive income, except when it relates to
items credited or debited directly to equity, in which case the deferred tax is also recognised directly in equity, or where it arises from the
initial accounting for a business combination, in which case it is taken into account in the determination of goodwill.
Cash comprises cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments that are readily
convertible to known amounts of cash, which are subject to an insignificant risk of changes in fair value and have a maturity of three
1.9 Cash and cash equivalents
months or less at the date of acquisition.
1.10 Acquisition of assets
All assets including property, plant and equipment and intangibles are initially recorded at their cost at the date of acquisition, being the
fair value of the consideration provided plus incidental costs directly attributable to the acquisition. The costs of assets constructed or
internally generated by the consolidated entity, other than goodwill, include the cost of materials, direct labour, directly attributable
overheads and other incidental costs.
Expenditure, including that on internally generated assets other than development costs, is only recognised as an asset when it is
probable that future economic benefits will eventuate and the costs can be measured reliably. Costs attributable to feasibility and
alternative approach assessments are expensed as incurred.
Costs incurred on assets subsequent to initial acquisition are capitalised when it is probable future economic benefits will flow to the
consolidated entity. Costs that do not meet the criteria for capitalisation are expensed as incurred.
1.11 Non-current assets held for sale
Non-current assets classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell. Non-
current assets are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through
continuing use. This condition is only met when the sale is highly probable and the asset is available for immediate sale in its present
condition and the sale is expected to be completed within one year from the date of classification.
1.12 Receivables
Trade debtors are recorded at amortised cost less impairment. The collectability of debts is assessed at year-end and a provision is
made for any doubtful debts. Changes in the carrying amount of the allowance are recognised in profit or loss.
1.13 Inventories
Inventories are carried at the lower of cost and net realisable value. Cost is determined using standard cost and for work in progress
includes an appropriate share of both variable and fixed costs. Net realisable value represents the estimated selling prices for the
inventories less all estimated costs of completion and costs necessary to make the sale.
1.14 Impairment of assets other than goodwill
At each reporting date, the carrying amounts of tangible and intangible assets are reviewed to determine whether there is any indication
those assets have suffered an impairment loss.
If any such indication exists, the recoverable amount of the asset is estimated in order
to determine the extent of any impairment loss. Where the asset does not generate cash flows that are independent from other assets,
the consolidated entity estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Intangible assets with
indefinite useful lives and intangible assets not yet available for use are tested for impairment annually and whenever there is an
indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, 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 which the estimates of future cash flows have not been adjusted.
If the recoverable
amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-
generating unit) is reduced to its recoverable amount. An impairment loss is recognised in profit or loss immediately, unless the
relevant asset is carried at fair value through equity, in which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised
estimate of its recoverable amount, but only to the extent the increased carrying amount does not exceed the carrying amount that
would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of
an impairment loss is recognised in profit or loss immediately, unless the relevant asset is carried at fair value through equity, in which
case the reversal of the impairment loss is treated as a revaluation increase.
1.15 Leases
Payments made under operating leases are expensed on a straight-line basis over the term of the lease, except where an alternative
basis is more representative of the pattern of benefits to be derived from the leased property.
1.16 Property, plant and equipment
Each class of property, plant and equipment is stated at historical cost less, where applicable, any accumulated depreciation and
impairment losses. Historical cost includes expenditure that is directly attributable to the acquisition of the items.
Property in the course of construction for production, supply or administrative purposes, or for purposes not yet determined, are carried
at cost, less any recognised impairment loss. Cost includes professional fees and, for qualifying assets, borrowing costs capitalised in
accordance with the Group’s accounting policy. Depreciation of these assets, on the same basis as other property assets, commences
when the assets are ready for their intended use.
Depreciation is recognised so as to write off the cost or valuation of assets (other than freehold land and properties under construction)
less their residual values over their useful lives, using the straight-line method. The estimated useful lives, residual values and
depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a
prospective basis. Freehold land is not depreciated.
The cost of self-constructed assets includes the cost of materials and direct labour and any other costs attributable to bringing an asset
to a working condition ready for its intended use.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from
the continued use of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is
determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.
1.17 Depreciation and amortisation
All non-financial assets of the entity (except land) have limited useful lives and are depreciated/amortised using the straight-line method
over their estimated useful lives to their estimated residual values. Assets are depreciated or amortised from the time an asset is ready
for use.
Depreciation and amortisation rates and methods and residual values are reviewed annually for appropriateness. When changes are
made adjustments are reflected in current and future periods only. Depreciation and amortisation are expensed, except to the extent
they are included in the carrying amount of another asset as an allocation of production overheads.
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FLEETWOOD CORPORATIONANNUAL REPORT 2015 Depreciation/amortisation rates used for each class of asset are as follows:
Buildings
Leasehold property and improvements
Plant and equipment
1.18 Investment Property
2015
2.5%
2014
2.5%
2% - 25%
2% - 25%
2.5% - 50% 2.5% - 50%
Investment properties are properties held to earn rent and/or for capital appreciation (including property under construction for such
purposes). Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment
properties are measured at fair value. Gains and losses arising from changes in the fair value of investment properties are included in
profit or loss in the period in which they arise.
An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no
future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of the property (calculated as the
difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the period in which the
property is derecognised.
1.19 Goodwill
For the purposes of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (or groups of cash-generating
units) that is expected to benefit from the synergies of the combination.
A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an
indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying amount, the
impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the
unit pro rata based on the carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised directly in profit or
loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.
On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss
on disposal.
1.20 Intangibles
Product development costs
Expenditure on research activities is recognised as an expense in the period in which it is incurred.
An intangible asset arising from product development (or from the development phase of an internal project) is recognised if the
following are demonstrated:
the technical feasibility of completing the intangible asset so that it will be available for use or sale;
the intention to complete the intangible asset and use or sell it;
the ability to use or sell the intangible asset;
how the intangible asset will generate probable future economic benefits;
the availability of adequate technical, financial and other resources to complete the development and to use or sell the
intangible asset; and
the expenditure attributable to the intangible asset during its development can be measured reliably.
The amount initially recognised for internally-generated intangible assets is the sum of the expenditure incurred from the date when the
asset first meets the recognition criteria. Where no internally-generated asset can be recognised, development expenditure is
recognised in profit or loss in the period in which it is incurred.
Subsequent to initial recognition, internally generated intangible assets are reported at cost less accumulated amortisation and
accumulated impairment losses and are amortised on a straight-line basis over their useful lives of 2 to 5 years.
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or
losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the
carrying amount of the asset, are recognised in profit or loss when the asset is derecognised.
1.21 Employee benefits
Wages, salaries, annual and long service leave
Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave
when it is probable that settlement will be required and they are capable of being measured reliably. Provisions expected to be settled
within 12 months are measured at their nominal values using the remuneration rate expected to apply at the time of settlement.
Provisions which are not expected to be settled within 12 months are measured as the present value of the estimated future cash flows
to be made in respect of services provided by employees up to the reporting date. The expected future payments incorporate
anticipated future wage and salary levels, experience of employee departures and periods of service, and are discounted at rates
determined by reference to market yields at the end of the reporting period on high quality corporate bonds (2014: government bonds)
that have maturity dates that approximate the timing of the estimated future cash flows. Any re-measurements arising from experience
adjustments and changes in assumptions are recognised in profit or loss in the periods in which the changes occur.
Share based payments
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of the equity
instruments at the grant date.
The fair value determined at grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting
period, based on the estimate of equity instruments that will eventually vest. At the end of each reporting period, the estimate of the
number of equity instruments expected to vest is reviewed. The impact of the revision is recognised in profit or loss such that the
cumulative expense reflects the revised estimate, with a corresponding adjustment to equity.
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ANNUAL REPORT 2015
Depreciation/amortisation rates used for each class of asset are as follows:
Buildings
Leasehold property and improvements
Plant and equipment
1.18 Investment Property
2015
2.5%
2014
2.5%
2% - 25%
2% - 25%
2.5% - 50% 2.5% - 50%
Investment properties are properties held to earn rent and/or for capital appreciation (including property under construction for such
purposes). Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment
properties are measured at fair value. Gains and losses arising from changes in the fair value of investment properties are included in
profit or loss in the period in which they arise.
An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no
future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of the property (calculated as the
difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the period in which the
property is derecognised.
1.19 Goodwill
For the purposes of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (or groups of cash-generating
units) that is expected to benefit from the synergies of the combination.
A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an
indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying amount, the
impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the
unit pro rata based on the carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised directly in profit or
loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.
On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss
on disposal.
1.20 Intangibles
Product development costs
following are demonstrated:
Expenditure on research activities is recognised as an expense in the period in which it is incurred.
An intangible asset arising from product development (or from the development phase of an internal project) is recognised if the
the technical feasibility of completing the intangible asset so that it will be available for use or sale;
the intention to complete the intangible asset and use or sell it;
the ability to use or sell the intangible asset;
how the intangible asset will generate probable future economic benefits;
the availability of adequate technical, financial and other resources to complete the development and to use or sell the
intangible asset; and
the expenditure attributable to the intangible asset during its development can be measured reliably.
The amount initially recognised for internally-generated intangible assets is the sum of the expenditure incurred from the date when the
asset first meets the recognition criteria. Where no internally-generated asset can be recognised, development expenditure is
recognised in profit or loss in the period in which it is incurred.
Subsequent to initial recognition, internally generated intangible assets are reported at cost less accumulated amortisation and
accumulated impairment losses and are amortised on a straight-line basis over their useful lives of 2 to 5 years.
An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or
losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the
carrying amount of the asset, are recognised in profit or loss when the asset is derecognised.
1.21 Employee benefits
Wages, salaries, annual and long service leave
Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave, long service leave and sick leave
when it is probable that settlement will be required and they are capable of being measured reliably. Provisions expected to be settled
within 12 months are measured at their nominal values using the remuneration rate expected to apply at the time of settlement.
Provisions which are not expected to be settled within 12 months are measured as the present value of the estimated future cash flows
to be made in respect of services provided by employees up to the reporting date. The expected future payments incorporate
anticipated future wage and salary levels, experience of employee departures and periods of service, and are discounted at rates
determined by reference to market yields at the end of the reporting period on high quality corporate bonds (2014: government bonds)
that have maturity dates that approximate the timing of the estimated future cash flows. Any re-measurements arising from experience
adjustments and changes in assumptions are recognised in profit or loss in the periods in which the changes occur.
Share based payments
instruments at the grant date.
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of the equity
The fair value determined at grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting
period, based on the estimate of equity instruments that will eventually vest. At the end of each reporting period, the estimate of the
number of equity instruments expected to vest is reviewed. The impact of the revision is recognised in profit or loss such that the
cumulative expense reflects the revised estimate, with a corresponding adjustment to equity.
Superannuation
Contributions to employee superannuation funds are expensed when the employees have rendered service entitling them to the
contributions.
1.22 Financial liabilities and equity instruments issued by the Group
Debt and equity instruments are classified as either liabilities or as equity in accordance with the substance of the contractual
arrangement. Equity instruments issued by the Group are recognised at the amount received, net of direct issue costs.
Payables
Liabilities are recognised for amounts to be paid in the future for goods or services received regardless of whether they have been billed
to the consolidated entity. They are initially valued at fair value, net of transaction costs.
Interest bearing liabilities
Bank loans are recognised initially at fair value net of transaction costs. Subsequent to initial recognition, bank loans are measured at
amortised cost with any difference between the initial recognised amount and the redemption value being recognised in profit or loss
over the period of the borrowing using the effective interest rate. Interest expense is recognised on an accrual basis.
The Group derecognises liabilities when, the obligations are discharged, cancelled or expire. The difference between the carrying
amount of the liability derecognised and the consideration paid and payable is recognised in profit or loss.
1.23 Comparative information
Comparative information has been restated to account for the impact of the discontinued operation and other reclassifications to bring
them in line with the current year classifications.
In the prior period the total amount of long-service leave was classified as non-current. The current portion of the long service leave
provision has been reclassified to current in the comparative period to bring it in line with the current year classification. The amounts
have been reclassified to better reflect the nature of the provision.
1.24 Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily
take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the
assets are substantially ready for their intended use or sale.
Income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the
borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
1.25 Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that
the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the
reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the
cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (where the effect of the
time value of money is material).
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is
recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured
reliably.
1.26 Derivative financial instruments
The Group enters into foreign exchange forward contracts to manage its exposure to foreign exchange rate risk. Further details of
derivative financial instruments are disclosed in notes 11, 21 and 28.
Derivatives are initially recognised at fair value at the date the derivative contract is entered into and are subsequently remeasured to
their fair value at the end of each reporting period. The resulting gain or loss is recognised in profit or loss immediately unless the
derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on
the nature of the hedge relationship.
1.27 Critical accounting judgments and key sources of estimation uncertainty
In the application of accounting policies, management is required to make judgments, estimates and assumptions. The estimates and
associated assumptions are based on experience and other factors that are considered relevant. Actual results may differ from these
estimates.
The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting
period, that have a risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
Accounting for construction contracts involves the continuous use of assessed estimates based on assumptions consistent
with project scope and schedule, contract and risk management processes. Contracts may span several accounting
periods. Estimates of forecast costs are regularly updated in accordance with the agreed work scope and schedule under the
contract. Forecasts are based on the cost expected to apply when the related activity is undertaken. Contingencies are
included in order to cover the risks in those forecasts. Revenues reflect the price agreed in the contract and variations where
they have been approved or if it is probable they will be approved. Claims are included in contract revenue only where
negotiations have reached an advanced stage such that it is probable that the client will accept the claim and recovery of the
amount involved is probable.
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which
goodwill has been allocated except for where fair value less cost to sell has been applied. The value in use calculation
requires the directors to estimate the future cash flows expected to arise from the cash-generating unit and a suitable
17
FLEETWOOD CORPORATIONANNUAL REPORT 2015
discount rate in order to calculate the present value. Details of goodwill and the subsequent testing for impairment are set out
in Note 14. Where the actual future cash flows are less than expected, a material impairment loss may arise.
The Company uses valuation techniques that include inputs that are not based on observable market data to estimate the fair
value of options issued during the year. Note 22 provides information about the key assumptions used in the determination of
the fair value of these options. The Directors believe that the chosen valuation techniques and assumptions used are
appropriate in determining the fair value of the options.
The carrying amount of goodwill at 30 June 2015 was $61.8million (30 June 2014: $59.4 million) after an impairment loss of
$2.1 million was recognised during 2015 (2014: $5 million). Details of the impairment loss calculation including key
assumptions are set out in note 14.
General information
Fleetwood Corporation Limited is a public company listed on the Australian Securities Exchange (trading under the symbol ‘FWD’),
incorporated in Australia and operating in Australia and New Zealand.
The registered and business address of the Company is 21 Regal Place, East Perth, Western Australia. The telephone number of the
company is (08) 9323 3300.
Tax consolidation
The Company and its wholly-owned Australian resident entities elected from 1 July 2003 to be taxed as a single entity.
Fleetwood Corporation Limited, as the head entity, and the subsidiaries in the tax consolidated group continue to account for their own
current and deferred tax amounts. The amounts are measured as if each entity continues to be a stand-alone taxpayer in its own right.
The current tax balances are then transferred to the head entity via intercompany balances. The entities within the Group have entered
a tax funding arrangement whereby each subsidiary will compensate the head entity for the amount of tax payable that would be
calculated as if the subsidiary was a tax paying entity.
The method used to calculate current and deferred tax amounts is summarised in Note 1.8.
18
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
discount rate in order to calculate the present value. Details of goodwill and the subsequent testing for impairment are set out
in Note 14. Where the actual future cash flows are less than expected, a material impairment loss may arise.
The Company uses valuation techniques that include inputs that are not based on observable market data to estimate the fair
value of options issued during the year. Note 22 provides information about the key assumptions used in the determination of
the fair value of these options. The Directors believe that the chosen valuation techniques and assumptions used are
appropriate in determining the fair value of the options.
The carrying amount of goodwill at 30 June 2015 was $61.8million (30 June 2014: $59.4 million) after an impairment loss of
$2.1 million was recognised during 2015 (2014: $5 million). Details of the impairment loss calculation including key
assumptions are set out in note 14.
General information
company is (08) 9323 3300.
Tax consolidation
Fleetwood Corporation Limited is a public company listed on the Australian Securities Exchange (trading under the symbol ‘FWD’),
incorporated in Australia and operating in Australia and New Zealand.
The registered and business address of the Company is 21 Regal Place, East Perth, Western Australia. The telephone number of the
The Company and its wholly-owned Australian resident entities elected from 1 July 2003 to be taxed as a single entity.
Fleetwood Corporation Limited, as the head entity, and the subsidiaries in the tax consolidated group continue to account for their own
current and deferred tax amounts. The amounts are measured as if each entity continues to be a stand-alone taxpayer in its own right.
The current tax balances are then transferred to the head entity via intercompany balances. The entities within the Group have entered
a tax funding arrangement whereby each subsidiary will compensate the head entity for the amount of tax payable that would be
calculated as if the subsidiary was a tax paying entity.
The method used to calculate current and deferred tax amounts is summarised in Note 1.8.
2 Revenue
Revenue from continuing operations comprises:
Sales revenue
Goods
Construction
Rental
Other income
Interest
(Loss) / gain on sale of non-current assets
2015
$ '000
2014
$ '000
169,963
72,620
59,417
179,769
139,772
46,748
302,000
366,289
75
(140)
(65)
120
109
229
301,935
366,518
All rental fleet units are available for sale and their sale is included in Sales revenue - goods rather than profit on sale of non-current
assets.
3 Profit before income tax expense
Expenses from continuing operations contain the following items:
Cost of sales
Depreciation and amortisation of:
buildings
leasehold improvements
plant and equipment
product development
Finance costs:
Bank loans and overdraft
Charges on hire purchases
Net bad and doubtful debts
Research and development costs
Superannuation expense
Equity settled share-based payments
206,814
280,295
34
4,149
23,680
1,250
34
5,307
11,290
993
29,113
17,624
3,959
-
3,959
2,198
29
2,227
65 (58)
11
4,359
468
23
5,003
945
19
FLEETWOOD CORPORATIONANNUAL REPORT 2015 4 Income taxes recognised in profit or loss
Current tax expense
Deferred tax expense relating to origination and reversal of temporary differences
Under provision of income tax in prior year
Continuing operations
Discontinued operations
Reconciliation of income tax expense to the accounting profit
Note
2015
$ '000
2014
$ '000
1,085 2,990
(426) (424)
59 243
718
2,809
35
-
(210)
Profit before tax from continuing operations
894
3,375
The tax rate used for 2015 and 2014 is the corporate tax rate of 30% payable by Australian corporate entities on taxable profits under
Australian tax law.
Income tax expense calculated at 30% (2014: 30%)
268 1,013
Amortisation of leasehold improvements
Effect of lower tax rates on overseas income
Non-deductible expenses
Research & development allowance
Rights to future income deductions
Non-assessable amounts
Sundry items
Adjustments relating to income tax in prior year
Deferred tax
Deferred tax relating to:
Property, plant and equipment
Employee provisions
Other provisions
Accruals
8
(14)
769
(313)
-
(62)
2
659
59
718
-
(13)
1,784
(221)
(39)
42
-
2,566
243
2,809
Balance
2013
$ '000
Charged
to income
$ '000
Balance
2014
$ '000
Charged
to income
$ '000
Balance
2015
$ '000
1,583
2,271
24
94
3,972
543
(179)
2
58
424
2,126
2,092
26
152
4,396
606
(118)
(14)
(48)
426
2,733
1,973
12
104
4,822
20
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
4 Income taxes recognised in profit or loss
Current tax expense
Deferred tax expense relating to origination and reversal of temporary differences
Under provision of income tax in prior year
Continuing operations
Discontinued operations
Reconciliation of income tax expense to the accounting profit
Note
2015
$ '000
2014
$ '000
1,085 2,990
(426) (424)
59 243
718
2,809
35
-
(210)
Australian tax law.
Income tax expense calculated at 30% (2014: 30%)
Amortisation of leasehold improvements
Effect of lower tax rates on overseas income
Non-deductible expenses
Research & development allowance
Rights to future income deductions
Non-assessable amounts
Sundry items
Adjustments relating to income tax in prior year
Deferred tax
Deferred tax relating to:
Property, plant and equipment
Employee provisions
Other provisions
Accruals
(14)
769
(313)
(62)
8
-
2
659
59
718
606
(118)
(14)
(48)
426
-
(13)
1,784
(221)
(39)
42
-
2,566
243
2,809
2,733
1,973
12
104
4,822
Balance
2013
$ '000
Charged
to income
$ '000
Balance
2014
$ '000
Charged
to income
$ '000
Balance
2015
$ '000
1,583
2,271
24
94
3,972
543
(179)
2
58
424
2,126
2,092
26
152
4,396
Profit before tax from continuing operations
894
3,375
The tax rate used for 2015 and 2014 is the corporate tax rate of 30% payable by Australian corporate entities on taxable profits under
Recreational Vehicles
Accommodation
Corporate
268 1,013
Finance costs
5 Segment information
Group operating segments are based on the internal reports that are reviewed and used by the Board of Directors (chief operating
decision makers) in assessing performance and determining the allocation of resources.
Business segments
Products / Services
Recreational Vehicles
Manufacture of caravans and vehicle parts and accessories
Manufactured Accommodation
Design, manufacture, sale and rental of manufactured accommodation
Corporate
Group corporate function
Revenue and results by reportable operating segment:
Segment
revenue
Depreciation &
amortisation
Asset
Impairment
Segment result (EBIT)
2015
$ '000
112,221
189,645
69
2014
$ '000
136,520
229,702
296
2015
$ '000
2,998
25,904
211
2014
$ '000
2,839
14,581
204
2015
$ '000
3,177
1,300
-
2014
$ '000
5,000
-
-
2015
$ '000
(10,197)
17,247
(2,197)
2014
$ '000
(7,129)
15,977
(3,246)
301,935
366,518
29,113
17,624
4,477
5,000
4,853
5,602
Profit before income tax expense
Income tax expense
Profit from continuing operations
Loss from discontinued operations
Profit attributable to members of the parent entity
(3,959)
(2,227)
894
3,375
(718)
(2,809)
176
-
176
566
(490)
76
The accounting policies of the reportable segments are the same as the Group’s accounting policies described in Note 1. Segment
results represents earnings before interest and tax without the allocation of corporate overheads.
Group assets and liabilities by segment:
Recreational Vehicles
Manufactured Accommodation
Corporate
Segment assets
2014
$ '000
2015
$ '000
Additions to
non-current assets
2014
$ '000
2015
$ '000
76,175
236,703
14,830
81,018
222,103
18,666
7,864
32,971
37
3,432
57,176
91
Segment
liabilities
2015
$ '000
14,815
33,362
65,530
2014
$ '000
18,236
25,322
63,820
327,708
321,787
40,872
60,699
113,707
107,378
For the purposes of monitoring segment performance and allocating resources all assets and liabilities are allocated to the reportable
segments other than current and deferred tax amounts and assets and liabilities directly utilised by the Corporate entity.
The Group operates in two principal geographical areas - Australia (country of domicile) and New Zealand.
Group non-current assets and revenues by geographical segment:
Australia
New Zealand
Segment non-current
assets
Revenue from external
customers
2015
$ '000
174,125
478
2014
$ '000
219,181
541
2015
$ '000
295,841
6,094
2014
$ '000
360,305
6,213
174,603
219,722
301,935
366,518
21
FLEETWOOD CORPORATIONANNUAL REPORT 2015 6 Dividends
Recognised amounts
Final 2014 - paid 2 cents per share fully franked
Interim 2014 - paid 2 cents per share fully franked
2015
$ '000
2014
$ '000
1,212
-
1,212
-
1,212
1,212
Dividend franking account
30% franking credits available to shareholders of Fleetwood Corporation Limited for
subsequent years
25,708 26,267
7 Earnings per share
Earnings used in the calculation of basic and diluted earnings per share from continuing
and discontinued operations
Adjustment to exclude loss from discontinued operation
Earnings used in the calculation of basic and diluted earnings per share from continuing
operations
176 76
-
490
176 566
The weighted average number of ordinary shares used in the calculation of diluted earnings
per share reconciles to the weighted average number of ordinary shares used in the
calculation of basic earnings per share as follows:
Weighted average number of ordinary shares used in the calculation of basic EPS
Number of shares deemed to be issued for no consideration in respect of options
Weighted average number of ordinary shares used in the calculation of diluted EPS
From continuing and discontinued operations
Basic earnings per share (cents)
Diluted earnings per share (cents)
From continuing operations
Basic earnings per share (cents)
Diluted earnings per share (cents)
From continuing operations before impairment
Basic earnings per share (cents)
Diluted earnings per share (cents)
There are no potential ordinary shares that are anti-dilutive.
Weighted average
number of shares used
60,847,809
60,537,267
72,600
74,423
60,920,409
60,611,690
0.3
0.3
0.3
0.3
6.5
6.5
0.1
0.1
0.9
0.9
9.2
9.2
22
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
6 Dividends
Recognised amounts
Final 2014 - paid 2 cents per share fully franked
Interim 2014 - paid 2 cents per share fully franked
Dividend franking account
subsequent years
7 Earnings per share
30% franking credits available to shareholders of Fleetwood Corporation Limited for
25,708 26,267
Earnings used in the calculation of basic and diluted earnings per share from continuing
and discontinued operations
Adjustment to exclude loss from discontinued operation
Earnings used in the calculation of basic and diluted earnings per share from continuing
operations
176 76
-
490
176 566
The weighted average number of ordinary shares used in the calculation of diluted earnings
per share reconciles to the weighted average number of ordinary shares used in the
calculation of basic earnings per share as follows:
Weighted average number of ordinary shares used in the calculation of basic EPS
Number of shares deemed to be issued for no consideration in respect of options
Weighted average number of ordinary shares used in the calculation of diluted EPS
From continuing and discontinued operations
Basic earnings per share (cents)
Diluted earnings per share (cents)
From continuing operations
Basic earnings per share (cents)
Diluted earnings per share (cents)
From continuing operations before impairment
Basic earnings per share (cents)
Diluted earnings per share (cents)
There are no potential ordinary shares that are anti-dilutive.
Weighted average
number of shares used
60,847,809
60,537,267
72,600
74,423
60,920,409
60,611,690
0.3
0.3
0.3
0.3
6.5
6.5
0.1
0.1
0.9
0.9
9.2
9.2
2015
$ '000
2014
$ '000
1,212
-
1,212
-
1,212
1,212
8 Cash and cash equivalents
Cash and cash equivalents
6,634
6,405
Cash at bank is at call and received interest at a weighted average rate of 1.42%
(2014: 1.61%).
2015
$ '000
2014
$ '000
9 Trade and other receivables
Current
Trade receivables
Less: allowance for doubtful debts
Other debtors
32,768
(387)
63,816
32,939
(15)
13,730
96,197
46,654
Trade and other debtors are non-interest bearing and are generally on terms ranging between 7 and 60 days. The average credit
period on sales of goods is 30 to 60 days. All trade and other debtors are expected to be settled within 60 days of year end.
Retentions on construction contracts included within other debtors amount to $1.2 million (2014: 0.8 million), to be received from the
customer on acceptance of the works performed and other contractual milestones.
Included in other debtors is $56.3 million pertaining to the Osprey Project which was settled on 20 July 2015. For further information
refer to note 36.
Concentrations of risk
The five largest outstanding receivables at 30 June 2015 by customer are:
Gateway Lifestyle Residential Parks
Pilbara Iron Company (Rio Tinto Limited)
Department of Education & Early Childhood Development (Victorian State Government)
Department of Education, Training & Employment (Queensland State Government)
FK Gardner & Sons Pty Ltd
3,945
3,921
2,809
2,551
1,989
727
1,855
5,158
4,470
1,989
Trade receivables include amounts that are past due at the end of the reporting period but against which the Group has not recognised
an allowance for doubtful receivables because there has not been a significant change in the credit quality and the amounts are still
considered recoverable. The Group does not hold any collateral over these balances. An analysis of aged receivables is included
below:
Less than 3 months
Between 3 - 6 months
Longer than 6 months
Movement in allowance for doubtful debts
Balance at beginning of year
Impairment losses recognised on receivables
Amounts provided for / (written off) during the year
3,874
239
2,715
6,828
15
49
323
387
4,879
166
144
5,190
102
55
(142)
15
23
FLEETWOOD CORPORATIONANNUAL REPORT 2015 10 Inventories
Current
Raw materials & stores
Work in progress
Finished goods
Non-current
Work in progress
2015
$ '000
2014
$ '000
7,413
15,274
22,559
45,246
8,477
14,200
21,827
44,504
-
-
45,745
45,745
The cost of inventories recognised as an expense during the year in respect of continuing operations was $101.1 million (2014: $146.6
million). The cost of inventories written down to net realisable value during the year was $0.4 million (2014: nil)
Work in progress relating to the Osprey Project has been reclassified as Other receivables at 30 June 2015 (refer note 9).
Included in current work in progress is $14.1 million (2014: $12.9 million) relating to construction contracts in progress, comprising
costs incurred and recognised profits (less recognised losses).
11 Other financial assets
Current
Derivatives not in designated hedge accounting relationships
206
-
The Group has entered into forward exchange contracts to hedge foreign currency risk on highly probable future purchases of inventory
from overseas.
12 Non-current assets held for sale
Plant & equipment
Plant & equipment held for sale are residual assets from the discontinued operation.
-
-
51
51
24
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
10 Inventories
Current
Raw materials & stores
Work in progress
Finished goods
Non-current
Work in progress
2015
$ '000
2014
$ '000
7,413
15,274
22,559
45,246
8,477
14,200
21,827
44,504
45,745
45,745
-
-
-
-
51
51
The cost of inventories recognised as an expense during the year in respect of continuing operations was $101.1 million (2014: $146.6
million). The cost of inventories written down to net realisable value during the year was $0.4 million (2014: nil)
Work in progress relating to the Osprey Project has been reclassified as Other receivables at 30 June 2015 (refer note 9).
Included in current work in progress is $14.1 million (2014: $12.9 million) relating to construction contracts in progress, comprising
costs incurred and recognised profits (less recognised losses).
11 Other financial assets
Current
from overseas.
Plant & equipment
12 Non-current assets held for sale
Plant & equipment held for sale are residual assets from the discontinued operation.
13 Property, plant and equipment
Freehold land
Cost
Buildings
Cost
Accumulated depreciation
Leasehold property and improvements
Cost
Accumulated amortisation
Plant and equipment
Cost
Accumulated depreciation
Assets under construction
Cost
2015
$ '000
2014
$ '000
1,669
1,408
1,342
(306)
1,036
1,342
(272)
1,070
53,903
(40,742)
53,461
(36,621)
13,161
16,840
140,047
(73,739)
130,268
(54,492)
66,308
75,776
25,502
14,608
107,676
109,702
Derivatives not in designated hedge accounting relationships
206
-
Movement in the carrying amounts of each class of property, plant and equipment:
The Group has entered into forward exchange contracts to hedge foreign currency risk on highly probable future purchases of inventory
2015 Financial Year
Balance at 1 July 2014
Additions
Acquisition through business acquired
Transferred from assets under construction
Transferred to plant and equipment
Disposals
Depreciation and amortisation
Impairment
Effect of foreign exchange differences
Freehold
land Buildings
Leasehold
Property
Plant and
equipment
Assets under
Construction
Total
1,408
261
-
-
-
-
-
-
-
1,070
16,840
-
-
-
-
-
470
-
-
-
-
75,776
1,675
89
20,255
14,608
109,702
31,387
33,793
-
-
89
20,255
-
(20,255)
(20,255)
(6,496)
(238)
(6,734)
(34)
(4,149)
(23,680)
-
-
-
-
(1,300)
(11)
-
-
-
(27,863)
(1,300)
(11)
Balance at 30 June 2015
1,669
1,036
13,161
66,308
25,502
107,676
2014 Financial Year
Balance at 1 July 2013
Additions
Transferred to non current assets held for sale
Transferred from assets under construction
Transferred to plant and equipment
Disposals
Depreciation and amortisation
Effect of foreign exchange differences
1,408
1,104
22,118
-
-
-
-
-
124
-
-
-
(16)
81,310
5,742
9,346
8,531
114,471
18,633
24,499
-
9,346
-
(9,346)
(9,346)
(121)
(9,240)
(259)
(380)
(2,951)
(12,207)
(34)
-
(5,386)
(11,290)
-
29
-
-
(16,710)
29
-
-
-
-
-
-
-
Balance at 30 June 2014
1,408
1,070
16,840
75,776
14,608
109,702
$1.4m of land is mortgaged under the Group's financing arrangements with Westpac.
25
FLEETWOOD CORPORATIONANNUAL REPORT 2015 14 Goodwill
Goodwill
Reconciliation of the carrying amount of Goodwill:
Gross carrying amount
Opening balance
Additional amounts recognised from business combination occurring during the period
Effect of foreign exchange differences
Accumulated impairment
Opening balance
Impairment loss in respect of caravan manufacturing CGU
Individual cash-generating unit (CGU) allocations:
Caravan manufacturing
Parts and accessories
Canopies, trays and accessories
Manufactured accommodation
2015
$ '000
2014
$ '000
61,761
59,431
64,431
4,425
2
64,435
-
(4)
68,858
64,431
(5,000)
(2,097)
-
(5,000)
(7,097)
(5,000)
-
12,401
11,040
38,320
2,097
12,401
6,613
38,320
61,761
59,431
The recoverable amount of the cash generating units has been determined as the higher of fair value less costs to sell, and value in
use. The value in use has been calculated using cashflow projections based on financial budgets approved by the board for the first
two years, and utilising a cashflow growth rate of 2.5% (2014: 2.6%) for caravan manufacturing CGU, 2.5% (2014: refer below) for
parts and accessories CGU, 2.5% (2014: 4%) for canopies, trays and accessories CGU and 2.5% (2014: 5%) for manufactured
accommodation CGU for those years not budgeted.
The implied discount rates of 18.9% (2014: 14.7%) for caravan manufacturing CGU, 18.9% (2014: refer below) for parts and
accessories CGU, 13.3% (2014: 14.7%) for canopies,
trays and accessories CGU and 12.25% (2014: 9.3%) for manufactured
accomodation CGU, reflect the respective CGU’s pre-tax weighted average cost of capital, and has been used in the value in use
calculations of the respective CGU. The terminal growth rate used is 2.5% (2014: 2.5%).
At 30 June 2015, if the forecast EBITDA for the parts and accessories CGU decreased by 20-30%, with all other variables held
constant, the carrying amount would likely exceed the recoverable amount for this CGU. At 30 June 2015, if the forecast EBITDA for
the canopies, trays and accessories CGU decreased by 20-30%, with all other variables held constant, the carrying amount would
likely exceed the recoverable amount for this CGU. For the manufactured accommodation CGU there is no reasonably possible
change in the key assumptions which would result in the carrying amount exceeding the recoverable amount.
At 30 June 2014, the recoverable amount for the parts and accessories CGU was assessed using a fair value less cost to sell model,
utilising a discounted cash flow projection over 10 years based on the financial budgets and business plans as approved by the board
for the first year and utilising a cash flow growth rate of 2.6% thereafter. The assumed cost of sale is then deducted to arrive at the
recoverable value of the CGU. A a pre-tax discount rate of 20.0% and a terminal growth rate of 2.5% is utilised in this analysis.
Testing for impairment is carried out on an annual basis and whenever there is an indication of impairment. A $2.1 million impairment
has been recorded against
the caravan manufacturing CGU reflecting the challenging demand environment for
recreational vehicles (2014: $5 million). No impairment charge has been recorded since recognising goodwill except those mentioned.
The recoverable amount of each CGU equals or exceeds the carrying amount of goodwill as at 30 June 2015. The key assumptions
used in determining the recoverable amounts are based on past experience and where applicable are consistent with external sources
of information.
the goodwill of
26
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
14 Goodwill
Goodwill
Gross carrying amount
Opening balance
Reconciliation of the carrying amount of Goodwill:
Additional amounts recognised from business combination occurring during the period
Effect of foreign exchange differences
Accumulated impairment
Opening balance
Impairment loss in respect of caravan manufacturing CGU
Individual cash-generating unit (CGU) allocations:
Caravan manufacturing
Parts and accessories
Canopies, trays and accessories
Manufactured accommodation
2015
$ '000
2014
$ '000
61,761
59,431
64,431
4,425
2
64,435
-
(4)
68,858
64,431
(5,000)
(2,097)
-
(5,000)
(7,097)
(5,000)
-
12,401
11,040
38,320
2,097
12,401
6,613
38,320
61,761
59,431
The recoverable amount of the cash generating units has been determined as the higher of fair value less costs to sell, and value in
use. The value in use has been calculated using cashflow projections based on financial budgets approved by the board for the first
two years, and utilising a cashflow growth rate of 2.5% (2014: 2.6%) for caravan manufacturing CGU, 2.5% (2014: refer below) for
parts and accessories CGU, 2.5% (2014: 4%) for canopies, trays and accessories CGU and 2.5% (2014: 5%) for manufactured
accommodation CGU for those years not budgeted.
The implied discount rates of 18.9% (2014: 14.7%) for caravan manufacturing CGU, 18.9% (2014: refer below) for parts and
accessories CGU, 13.3% (2014: 14.7%) for canopies,
trays and accessories CGU and 12.25% (2014: 9.3%) for manufactured
accomodation CGU, reflect the respective CGU’s pre-tax weighted average cost of capital, and has been used in the value in use
calculations of the respective CGU. The terminal growth rate used is 2.5% (2014: 2.5%).
At 30 June 2015, if the forecast EBITDA for the parts and accessories CGU decreased by 20-30%, with all other variables held
constant, the carrying amount would likely exceed the recoverable amount for this CGU. At 30 June 2015, if the forecast EBITDA for
the canopies, trays and accessories CGU decreased by 20-30%, with all other variables held constant, the carrying amount would
likely exceed the recoverable amount for this CGU. For the manufactured accommodation CGU there is no reasonably possible
change in the key assumptions which would result in the carrying amount exceeding the recoverable amount.
At 30 June 2014, the recoverable amount for the parts and accessories CGU was assessed using a fair value less cost to sell model,
utilising a discounted cash flow projection over 10 years based on the financial budgets and business plans as approved by the board
for the first year and utilising a cash flow growth rate of 2.6% thereafter. The assumed cost of sale is then deducted to arrive at the
recoverable value of the CGU. A a pre-tax discount rate of 20.0% and a terminal growth rate of 2.5% is utilised in this analysis.
Testing for impairment is carried out on an annual basis and whenever there is an indication of impairment. A $2.1 million impairment
has been recorded against
the goodwill of
the caravan manufacturing CGU reflecting the challenging demand environment for
recreational vehicles (2014: $5 million). No impairment charge has been recorded since recognising goodwill except those mentioned.
The recoverable amount of each CGU equals or exceeds the carrying amount of goodwill as at 30 June 2015. The key assumptions
used in determining the recoverable amounts are based on past experience and where applicable are consistent with external sources
of information.
15 Intangible assets
Product development
At cost
Accumulated amortisation
Product development WIP
At cost
Reconciliation of the carrying amounts:
Product development
Cost
Opening balance
Transferred from product development WIP
Transferred from property, plant and equipment
Additions
Disposals
Impairment
Accumulated amortisation
Opening balance
Amortisation charged for the year
Eliminated on disposal
Eliminated on impairment
Product development WIP
Carrying amount at beginning of year
Additions
Impairment
Transferred to product development
Intangible assets have a useful life of 2 to 5 years
16 Trade and other payables
Trade creditors
Payments in advance
Other creditors and accruals
2015
$ '000
2014
$ '000
4,993
(1,932)
4,684
(1,921)
3,061
2,763
2,105
5,166
2,081
4,844
4,684
1,556
-
676
(283)
(1,640)
4,670
515
380
983
(1,864)
-
4,993
4,684
1,921
1,250
(282)
(957)
2,788
993
(1,860)
-
1,932
1,921
2,081
1,977
(397)
(1,556)
2,105
1,146
1,450
-
(515)
2,081
25,782
166
17,724
43,672
23,706
182
13,965
37,853
Payables include amounts for goods received not invoiced. Trade and other payables are non-interest bearing. The average credit
period on purchases is 45 days.
Included in other creditors and accruals is $6.2 million of advances received from customers related to work not yet performed on
construction contracts in progress at the end of the reporting period (2014: $2.1 million)
27
FLEETWOOD CORPORATIONANNUAL REPORT 2015 17 Provisions
Current
Employee benefits
Other
Non-current
Employee benefits
Aggregate employee benefits
2015
$ '000
2014
$ '000
5,593
12
5,605
5,732
105
5,837
971
1,138
6,564
6,870
Provisions for employee benefits represent accrued annual
amounts required to remove asbestos from portable buildings and other costs associated with the discontinued operation.
leave and long sevice leave entitlements. Other provisions represent
18 Interest bearing liabilities
Current - at amortised cost
Bank loans - secured
Hire purchase creditors - secured
19
20
62,500
62,400
-
11
62,500
62,411
There were no hire purchase arrangements as at 30 June 2015. (2014: repayment periods of less than 1 year with interest rates
payable of 7.46% to 7.47%).
19 Financing arrangements
The consolidated entity has access to the following lines of credit:
Facilities available
Bank loans
Bank guarantees
Multi Option Facility
70,000
5,000
75,000
68,400
3,000
71,400
Under the terms of the Multi Option Facility, the consolidated entity is entitled to draw on any mix of commercial bill, bank guarantees,
standby letter of credit or bank overdraft.
18
62,500
2,201
64,701
7,500
2,799
10,299
62,400
1,973
64,373
6,000
1,027
7,027
Facilities utilised
Bank loans
Bank guarantees
Facilities not utilised
Bank loans
Bank guarantees
28
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Provisions for employee benefits represent accrued annual
leave and long sevice leave entitlements. Other provisions represent
amounts required to remove asbestos from portable buildings and other costs associated with the discontinued operation.
17 Provisions
Current
Other
Employee benefits
Non-current
Employee benefits
Aggregate employee benefits
18 Interest bearing liabilities
Current - at amortised cost
Bank loans - secured
Hire purchase creditors - secured
payable of 7.46% to 7.47%).
19 Financing arrangements
Facilities available
Bank loans
Bank guarantees
Multi Option Facility
Facilities utilised
Bank loans
Bank guarantees
Facilities not utilised
Bank loans
Bank guarantees
2015
$ '000
2014
$ '000
5,593
12
5,605
5,732
105
5,837
971
1,138
6,564
6,870
62,500
62,400
-
11
62,500
62,411
70,000
5,000
75,000
68,400
3,000
71,400
62,500
2,201
64,701
7,500
2,799
10,299
62,400
1,973
64,373
6,000
1,027
7,027
19
20
18
19 Financing arrangements (continued)
On 20 July 2015, Fleetwood sold the Osprey Village to the West Australian Housing Authority for $62.2m. The receivable created by
the transaction has a term of 14 years and was subsequently assigned to its financier, Westpac for an upfront payment of $62.2m.
This assignment enabled Fleetwood to be debt free as at the date of repayment. For further information on this transaction please
refer to note 36.
Bank loans
Bank loans are secured by a mortgage debenture over the assets of the consolidated entity and bear interest at the BBSY rate plus
1.125% (2014: 1.00%) plus a line fee of 1.125% (2014: 1.00%). The effective annual interest rate at the end of the financial year was
3.22% (2014: 3.57%).
Bank guarantees
Bank guarantees are utilised for construction contracts. No liability has been recognised in the statement of financial position in
respect of bank guarantees.
20 Commitments
Operating lease commitments
Within one year
Between one and five years
Later than five years
2015
$ '000
2014
$ '000
8,400
7,238
-
8,111
11,591
-
15,638
19,702
There were no hire purchase arrangements as at 30 June 2015. (2014: repayment periods of less than 1 year with interest rates
The Group has a number of non-cancellable operating lease arrangements for land and buildings with lease terms of between 1 to 5
years. The leases have varying terms and renewal rights. The majority of these lease contracts contain market review clauses in the
event that the lessee exercises its option to renew. The lessee does not have the option to purchase the property at the expiry of the
lease period.
The consolidated entity has access to the following lines of credit:
Operating lease receivables
Within one year
Between one and five years
Later than five years
9,342
-
-
9,342
24,932
9,672
-
34,604
Under the terms of the Multi Option Facility, the consolidated entity is entitled to draw on any mix of commercial bill, bank guarantees,
standby letter of credit or bank overdraft.
The Group has a number of non-cancellable operating lease arrangements for portable buildings and contracts for the provision of
accommodation services. The leases have varying terms and renewal rights. The majority of these lease contracts contain market
review clauses. The lessee does not have the option to purchase the property at the expiry of the lease period.
Hire purchase commitments
Within one year
One year or later and no later than five years
Later than five years
Less: future finance charges
Present value of minimum lease payments
Minimum lease
payments
Present value of
minimum lease
payments
2015
$ '000
2014
$ '000
2015
$ '000
2014
$ '000
-
-
-
-
-
-
11
-
-
11
-
11
-
-
-
-
-
-
11
-
-
11
-
11
29
FLEETWOOD CORPORATIONANNUAL REPORT 2015 2015
$ '000
2014
$ '000
21 Other financial liabilities
Current
Derivatives not in designated hedge accounting relationships
-
139
The Group has entered into forward exchange contracts to hedge foreign currency risk on highly probable future purchases of inventory
from overseas.
22 Share based payments
Employee plan
A scheme under which rights to acquire ordinary shares may be issued by the company to employees for no consideration was
approved by shareholders at the 2014 annual general meeting. Employees who have been continuously employed by the group for at
least one year are eligible to participate in the scheme. Employees will be issued shares in Fleetwood Corporation Limited upon the
exercise of the rights. One third of the rights are exercisable 1 year from the date of issue and a further one third of the rights are
exercisable in each of the next 2 years. One share right represents one Fleetwood Corporation Limited share. There are no voting or
dividend entitlements attaching to the rights. No amount is payable upon exercise of the rights and shares issued upon exercise rank
equally with existing shares on the ASX.
Summary of movements:
Weighted
average
share
price at
grant date
$
Rights at
beginning of
year
No.
Rights
granted
No.
Rights
expired /
forfeited
No.
Rights
exercised
(shares
issued)
No.
Rights at
end of year
No.
Vested
at end of
year
No.
Fair value
(market value)
of shares on
exercise
$
1.35
N/A
-
-
284,700
-
(212,100)
-
-
-
72,600
-
-
-
-
-
Issue
date
18/12/14
2015
2014
Employee share rights granted have been valued at the volume weighted average price at which Fleetwood’s share traded over five
trading days commencing 24 November 2014 ($1.35).
Executive Plan
The establishment of a new Executive Long Term Incentive plan was approved by shareholders at the 2014 annual general meeting.
Under the executive plan, executives and other senior employees of the group, declared eligible by the board, are granted options or
shares in Fleetwood Corporation Limited. All eligible candidates under the executive plan have opted to have shares granted over
options. No amounts are paid or payable by the recipient on the granting of shares.
The shares granted under the executive plan are held in a trust structure. Executives and employees declared eligible by the board hold
share units in the Fleetwood Executive Share Trust to which the shares are allocated. Participants are provided with an interest free,
non-recourse loan from the Company for the sole purpose of acquiring share units in the trust. The shares are granted upfront but are
restricted and subject to a risk of forfeiture until the end of the vesting period. To gain access to the shares, the participant must repay
the outstanding loan. One share unit within the Fleetwood Share trust represents one Fleetwood Corporation Limited share.
One third of the share units granted vest the greater of 1 year from the grant date or 2 years from employment date, a further one third
vest the greater of 2 years from grant date or 3 years from employment date and the remaining one third vest the greater of 3 years
from grant date or 4 years from employment date. Upon vesting share units in the Executive Share Trust are exercisable if the total
shareholder return equals or exceeds 15% p.a. from the grant date to the vesting date and total shareholder return is equal to or
exceeds the All Ordinaries Index over the same period. The amount payable upon exercising one share unit is the volume weighted
average price at which Fleetwood’s share traded over five trading days commencing 24 November 2014 ($1.35). Any unvested share
units in the executive share trust will expire five years from grant date. The shares granted are quoted on the ASX and rank equally with
existing shares on the ASX.
Summary of movements:
Weighted
average
share
price at
grant date
$
Share units at
beginning of
year
No.
Share uints
granted
No.
Share units
expired /
forfeited
No.
Share units
exercised
(shares
issued)
No.
Share
units at end
of year
No.
Vested
at end of
year
No.
Fair value
(market value)
of shares on
exercise
$
1.35
N/A
-
-
360,000
-
-
-
-
-
360,000
-
-
-
-
-
Issue
date
18/12/14
2015
2014
30
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Derivatives not in designated hedge accounting relationships
-
139
The Group has entered into forward exchange contracts to hedge foreign currency risk on highly probable future purchases of inventory
21 Other financial liabilities
Current
from overseas.
22 Share based payments
Employee plan
Issue
date
18/12/14
2015
2014
A scheme under which rights to acquire ordinary shares may be issued by the company to employees for no consideration was
approved by shareholders at the 2014 annual general meeting. Employees who have been continuously employed by the group for at
least one year are eligible to participate in the scheme. Employees will be issued shares in Fleetwood Corporation Limited upon the
exercise of the rights. One third of the rights are exercisable 1 year from the date of issue and a further one third of the rights are
exercisable in each of the next 2 years. One share right represents one Fleetwood Corporation Limited share. There are no voting or
dividend entitlements attaching to the rights. No amount is payable upon exercise of the rights and shares issued upon exercise rank
equally with existing shares on the ASX.
Summary of movements:
Weighted
average
share
grant date
$
Rights at
Rights
exercised
Vested
(market value)
price at
beginning of
(shares
Rights at
at end of
of shares on
year
No.
Rights
granted
No.
expired /
forfeited
No.
issued)
end of year
No.
No.
year
No.
Fair value
exercise
Rights
1.35
N/A
-
-
284,700
(212,100)
-
-
-
-
72,600
-
-
-
Employee share rights granted have been valued at the volume weighted average price at which Fleetwood’s share traded over five
trading days commencing 24 November 2014 ($1.35).
Executive Plan
The establishment of a new Executive Long Term Incentive plan was approved by shareholders at the 2014 annual general meeting.
Under the executive plan, executives and other senior employees of the group, declared eligible by the board, are granted options or
shares in Fleetwood Corporation Limited. All eligible candidates under the executive plan have opted to have shares granted over
options. No amounts are paid or payable by the recipient on the granting of shares.
The shares granted under the executive plan are held in a trust structure. Executives and employees declared eligible by the board hold
share units in the Fleetwood Executive Share Trust to which the shares are allocated. Participants are provided with an interest free,
non-recourse loan from the Company for the sole purpose of acquiring share units in the trust. The shares are granted upfront but are
restricted and subject to a risk of forfeiture until the end of the vesting period. To gain access to the shares, the participant must repay
the outstanding loan. One share unit within the Fleetwood Share trust represents one Fleetwood Corporation Limited share.
One third of the share units granted vest the greater of 1 year from the grant date or 2 years from employment date, a further one third
vest the greater of 2 years from grant date or 3 years from employment date and the remaining one third vest the greater of 3 years
from grant date or 4 years from employment date. Upon vesting share units in the Executive Share Trust are exercisable if the total
shareholder return equals or exceeds 15% p.a. from the grant date to the vesting date and total shareholder return is equal to or
exceeds the All Ordinaries Index over the same period. The amount payable upon exercising one share unit is the volume weighted
average price at which Fleetwood’s share traded over five trading days commencing 24 November 2014 ($1.35). Any unvested share
units in the executive share trust will expire five years from grant date. The shares granted are quoted on the ASX and rank equally with
existing shares on the ASX.
Summary of movements:
Weighted
average
share
Share units at
Share units
exercised
Share
Vested
(market value)
Issue
date
price at
beginning of
Share uints
grant date
$
year
No.
granted
No.
expired /
forfeited
No.
(shares
issued)
No.
of year
No.
year
No.
units at end
at end of
of shares on
Fair value
exercise
Share units
18/12/14
2015
2014
1.35
N/A
-
-
360,000
-
-
-
-
-
360,000
-
-
-
$
-
-
$
-
-
2015
$ '000
2014
$ '000
22 Share based payments (continued)
Share units information:
Issue
Date
Expiry
Date
Vesting
tranche
Volatility
%
Dividend
yield
%
Risk free
interest
rate
%
Fair value
at grant
date
$
Exercise
price
$
Weighted
average
share
price at
grant date
$
Weighted
average
share
price at
exercise
date 2015
$
Weighted
average
share
price at
exercise
date 2014
$
18/12/14
18/12/19
1
2
3
47.57
47.57
47.57
3.20
3.20
3.20
2.40
2.40
2.40
0.43
0.42
0.39
1.35
1.35
1.35
1.35
1.35
1.35
-
-
-
-
-
-
The fair value at grant date for Executive shares units is determined using a Monte Carlo simulation model. The expected volatility is
based on historical share price volatility over the past 5 years, and the risk free interest rate and dividend yield have been assessed
based on prevailing market conditions.
In addition, specific factors in relation to the likely achievement of performance hurdles and
employment tenure have been taken into account.
Employee option plan
The group ceased offering options to its employees and now utilizes the rights plan approved at its 2014 AGM. Options under the old
Employee option plan remain valid options with the same terms as they were issued.
Employees with more than 1 years service with the consolidated entity were granted options to purchase ordinary shares in Fleetwood
Corporation Limited. No amounts are payable for the options. 50% of the options are exercisable 1 year from the date of issue and a
further 25% are exercisable in each of the next 2 years. The options expire 5 years from the date of issue. There are no voting or
dividend rights attaching to the options.
Summary of movements:
Exercise
price
$
Options at
beginning of
year
No.
Options
granted
No.
Options
expired /
forfeited
No.
Options
exercised
(shares
issued)
No.
Options
at end of
year
No.
Vested
at end of
year
No.
Proceeds
received on
exercise
$
Fair value
(market value)
of shares on
exercise
$
Issue
date
14/11/08
2015
2014
31/10/09
2015
2014
31/10/10
2015
2014
02/09/11
2015
2014
29/08/12
2015
2014
30/08/13
2015
2014
2015
2014
4.20
6.00
8.02
8.68
9.39
2.56
-
110,200
166,457
195,327
279,199
330,394
300,133
356,571
366,640
437,570
-
-
-
-
-
-
-
-
-
-
-
(110,200)
(166,457)
(28,870)
(42,168)
(51,195)
(44,977)
(56,438)
(63,240)
(70,930)
509,050
-
-
584,850
(93,000)
(75,800)
1,621,479
1,430,062
-
584,850
(409,842)
(393,433)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
166,457
-
166,457
237,031
279,199
237,031
279,199
255,156
300,133
255,156
220,989
303,400
366,640
227,550
183,775
416,050
509,050
208,025
-
1,211,637
1,621,479
927,762
850,420
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Weighted average
exercise price ($)
2015
2014
6.53
5.16
N/A
2.56
6.24
6.09
N/A
N/A
6.63
6.53
7.31
8.09
-
-
-
-
-
-
-
-
-
-
-
-
-
-
31
FLEETWOOD CORPORATIONANNUAL REPORT 2015 22 Share based payments (continued)
Options information:
Option
life
Issue Date Expiry Date Years
Volatility
%
Dividend
yield
%
Risk free
interest
rate
%
Fair value
at grant
date
$
Exercise
price
$
Share
price at
grant date
$
Weighted
average share
price at
exercise date
2015
$
Weighted
average share
price at
exercise date
2014
$
14/11/08
31/10/09
31/10/10
02/09/11
29/08/12
30/08/13
13/11/13
30/10/14
30/10/15
01/09/16
28/08/17
30/08/18
Executive option plan
5
5
5
5
5
5
45.90
50.00
40.00
35.69
35.80
45.03
10.74
8.54
6.14
6.18
7.59
3.64
3.97
4.53
4.50
4.50
2.77
2.54
0.42
2.09
4.03
2.53
2.31
0.90
4.20
6.00
8.02
8.68
9.39
2.56
5.25
7.57
10.02
10.66
11.78
3.10
-
-
-
-
-
-
-
-
-
-
-
-
The previous Executive option plan has been replaced by the Executive Long Term Incentive Plan as approved at the 2014 AGM.
Options issued under the old Executive option plan remain valid options with the same terms as they were issued.
Executives are granted options to purchase ordinary shares in Fleetwood Corporation Limited. No amounts are payable for the options.
For options issued prior to 1 July 2012, one third of the options are exercisable after the 30 June subsequent to the date of issue, a
further one third of the options are exercisable in each of the next 2 years. Options issued after 1 July 2012 vest three years from the
issue date. The options are only exercisable if the company’s total shareholder return equals or exceeds 15% p.a. compounded from
the inception of the plan (1999) and is equal to or greater than the ASX300 All Industrials Accumulation Index. The options expire 5
years from the date of issue. There are no voting or dividend rights attaching to the options.
Summary of movements:
Exercise
price
$
Options at
beginning of
year
No.
Options
granted
No.
Options
expired /
forfeited
No.
Options
exercised
(shares
issued)
No.
Options
at end of
year
No.
Vested
at end of
year
No.
Proceeds
received on
exercise
$
Fair value
(market value)
of shares on
exercise
$
7.25
6.00
8.02
8.68
10.57
2.88
31,122
-
(31,122)
16,000
16,000
101,666
135,000
131,337
206,337
190,000
325,000
-
-
-
-
-
-
-
-
(16,000)
-
(20,000)
(33,334)
(34,562)
(75,000)
(60,000)
(135,000)
350,000
-
-
580,000
(80,000)
(230,000)
789,003
713,459
-
(210,562)
580,000
(504,456)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
16,000
-
16,000
81,666
101,666
81,666
101,666
96,775
131,337
96,775
87,558
130,000
190,000
270,000
350,000
-
-
-
-
578,441
789,003
178,441
205,224
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Issue
date
14/11/08
2014
31/10/09
2015
2014
31/10/10
2015
2014
02/09/11
2015
2014
20/02/13
2015
2014
30/08/13
2015
2014
2015
2014
Weighted average
exercise price ($)
2015
2014
32
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
6.42
9.29
N/A
2.88
6.75
6.41
N/A
N/A
6.30
6.42
8.38
8.14
22 Share based payments (continued)
Options information:
Option
Dividend
interest
at grant
Exercise
price at
exercise date
exercise date
Risk free
Fair value
Share
price at
price at
Weighted
Weighted
average share
average share
price
grant date
$
$
2015
$
2014
$
Issue Date Expiry Date Years
%
life
Volatility
14/11/08
31/10/09
31/10/10
02/09/11
29/08/12
30/08/13
13/11/13
30/10/14
30/10/15
01/09/16
28/08/17
30/08/18
Executive option plan
5
5
5
5
5
5
45.90
50.00
40.00
35.69
35.80
45.03
yield
%
10.74
8.54
6.14
6.18
7.59
3.64
rate
%
3.97
4.53
4.50
4.50
2.77
2.54
date
$
0.42
2.09
4.03
2.53
2.31
0.90
4.20
6.00
8.02
8.68
9.39
2.56
5.25
7.57
10.02
10.66
11.78
3.10
The previous Executive option plan has been replaced by the Executive Long Term Incentive Plan as approved at the 2014 AGM.
Options issued under the old Executive option plan remain valid options with the same terms as they were issued.
Executives are granted options to purchase ordinary shares in Fleetwood Corporation Limited. No amounts are payable for the options.
For options issued prior to 1 July 2012, one third of the options are exercisable after the 30 June subsequent to the date of issue, a
further one third of the options are exercisable in each of the next 2 years. Options issued after 1 July 2012 vest three years from the
issue date. The options are only exercisable if the company’s total shareholder return equals or exceeds 15% p.a. compounded from
the inception of the plan (1999) and is equal to or greater than the ASX300 All Industrials Accumulation Index. The options expire 5
years from the date of issue. There are no voting or dividend rights attaching to the options.
Options at
Exercise
beginning of
year
No.
Options
granted
No.
Options
expired /
forfeited
No.
Options
(shares
issued)
No.
exercised
Options
Vested
Proceeds
(market value)
at end of
at end of
received on
of shares on
year
No.
year
No.
exercise
exercise
Fair value
Summary of movements:
Issue
date
14/11/08
2014
price
$
7.25
31/10/09
6.00
31/10/10
8.02
02/09/11
8.68
20/02/13
10.57
30/08/13
2.88
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
Weighted average
exercise price ($)
31,122
-
(31,122)
16,000
16,000
101,666
135,000
131,337
206,337
190,000
325,000
(16,000)
-
(20,000)
(33,334)
(34,562)
(75,000)
(60,000)
(135,000)
-
-
-
-
-
-
-
-
-
-
-
16,000
16,000
81,666
101,666
81,666
101,666
96,775
131,337
96,775
87,558
130,000
190,000
270,000
350,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
350,000
(80,000)
-
580,000
(230,000)
789,003
713,459
-
(210,562)
580,000
(504,456)
578,441
789,003
178,441
205,224
6.42
9.29
N/A
2.88
6.75
6.41
N/A
N/A
6.30
6.42
8.38
8.14
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
-
-
-
-
22 Share based payments (continued)
Options information:
Option
life
Issue Date Expiry Date Years
Volatility
%
Dividend
yield
%
Risk free
interest
rate
%
Fair value
at grant
date
$
Exercise
price
$
Share
price at
grant date
$
Weighted
average share
price at
exercise date
2015
$
Weighted
average share
price at
exercise date
2014
$
14/11/08
31/10/09
31/10/10
02/09/11
20/02/13
30/08/13
13/11/13
30/10/14
30/10/15
01/09/16
19/02/18
30/08/18
5
5
5
5
5
5
45.90
50.00
40.00
35.69
35.39
45.03
10.74
8.54
6.14
6.18
7.59
3.64
3.97
4.53
4.50
4.50
2.85
3.68
0.32
2.09
2.43
2.53
1.15
1.40
7.25
6.00
8.02
8.68
10.57
2.88
5.25
7.57
10.02
10.66
9.66
3.10
-
-
-
-
-
-
-
-
-
-
-
-
Employee and Executive share options outstanding at the end of the financial year had a weighted average remaining contractual life of
754 days.
The grant date weighted average fair value of options in existence at reporting date is:
Options issued in 2010: $1.73 per option
Options issued in 2011: $3.24 per option
Options issued in 2012: $2.50 per option
Options issued in 2013: $1.57 per option
Options issued in 2014: $0.67 per option
Employee Options were valued using the Black-Scholes option pricing model. The expected life used in the model has been adjusted
based on management’s best estimate of the effects of exercise restrictions and behavioral considerations. The expected volatility is
based on historical share price volatility over the past 5 years, and the risk free interest rate and dividend yield have been assessed
based on prevailing market conditions.
Executive Options were valued using a Monte Carlo simulation model. The expected volatility is based on historical share price volatility
over the past 5 years, and the risk free interest rate and dividend yield have been assessed based on prevailing market conditions.
33
FLEETWOOD CORPORATIONANNUAL REPORT 2015 2015
$ '000
2014
$ '000
23 Issued capital
Issued and paid-up capital
61,039,412 (2014: 60,581,211) ordinary shares, fully paid
194,762 194,096
Holders of ordinary shares are entitled to receive dividends as declared and to one vote per share held.
2015
2014
# Shares
$ '000
# Shares
$ '000
Movements in ordinary share capital
Balance at beginning of year
Equity settled share-based payments
Shares issued pursuant to Dividend Reinvestment Plan
Shares issued pursuant to Employee and Executive Option Plans
60,581,211
-
98,201
360,000
194,096
468
198
-
60,522,619
-
58,592
-
193,001
945
150
-
Balance at the end of year
61,039,412
194,762
60,581,211
194,096
Ordinary shares are allotted under the dividend reinvestment plan at a discount to the weighted average price of ordinary shares sold
on the ASX over the period of 5 business days up to and including the record date. The current discount is 2.5% (2014: 2.5%).
At 30 June 2015, employees held options over 1,211,637 ordinary shares of the Company, of which 237,031 will expire on 30 October
2015. At 30 June 2014, employees held options over 1,621,479 ordinary shares of the Company, of which 166,457 expired on 30
October 2014.
(2014:
At 30 June 2015, employees held rights over 72,600 ordinary shares of the Company. The rights do not have an expiry date
nil). At 30 June 2015, executives held options over 578,441 ordinary shares of the Company, of which 81,666 will expire on 30
October 2015. At 30 June 2014, executives held options over 789,003 ordinary shares of the Company, of which 16,000 expired on 30
October 2014.
24 Reserves (net of income tax)
Foreign currency translation reserve
Balance at beginning of year
Translation of foreign operations
Reserves relate to exchange differences on the translation of self-sustaining foreign operations.
25 Retained earnings
Balance at beginning of year
Profit attributable to members of the parent entity
Dividends recognised
26 Auditors' remuneration
Audit services
Other services - taxation and accounting assistance
2015
$ '000
2014
$ '000
(219)
(38)
(257)
(578)
359
(219)
20,532
176
(1,212)
21,668
76
(1,212)
19,496
20,532
79
9
88
208
13
221
The auditor of Fleetwood Corporation Limited for 2015 is Grant Thornton (2014: Deloitte Touche Tohmatsu).
34
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
23 Issued capital
Issued and paid-up capital
61,039,412 (2014: 60,581,211) ordinary shares, fully paid
194,762 194,096
Movements in ordinary share capital
Balance at beginning of year
Equity settled share-based payments
Shares issued pursuant to Dividend Reinvestment Plan
Shares issued pursuant to Employee and Executive Option Plans
2015
2014
# Shares
$ '000
# Shares
$ '000
60,581,211
194,096
60,522,619
193,001
-
98,201
360,000
468
198
-
58,592
-
-
945
150
-
Balance at the end of year
61,039,412
194,762
60,581,211
194,096
Ordinary shares are allotted under the dividend reinvestment plan at a discount to the weighted average price of ordinary shares sold
on the ASX over the period of 5 business days up to and including the record date. The current discount is 2.5% (2014: 2.5%).
At 30 June 2015, employees held options over 1,211,637 ordinary shares of the Company, of which 237,031 will expire on 30 October
2015. At 30 June 2014, employees held options over 1,621,479 ordinary shares of the Company, of which 166,457 expired on 30
At 30 June 2015, employees held rights over 72,600 ordinary shares of the Company. The rights do not have an expiry date
(2014:
nil). At 30 June 2015, executives held options over 578,441 ordinary shares of the Company, of which 81,666 will expire on 30
October 2015. At 30 June 2014, executives held options over 789,003 ordinary shares of the Company, of which 16,000 expired on 30
October 2014.
October 2014.
Reserves relate to exchange differences on the translation of self-sustaining foreign operations.
24 Reserves (net of income tax)
Foreign currency translation reserve
Balance at beginning of year
Translation of foreign operations
25 Retained earnings
Balance at beginning of year
Profit attributable to members of the parent entity
Dividends recognised
26 Auditors' remuneration
Audit services
Other services - taxation and accounting assistance
The auditor of Fleetwood Corporation Limited for 2015 is Grant Thornton (2014: Deloitte Touche Tohmatsu).
2015
$ '000
2014
$ '000
(219)
(38)
(257)
(578)
359
(219)
20,532
176
(1,212)
21,668
76
(1,212)
19,496
20,532
79
9
88
208
13
221
Holders of ordinary shares are entitled to receive dividends as declared and to one vote per share held.
Subsidiaries subject to the deed are:
2015
$ '000
2014
$ '000
27 Deed of cross guarantee
Pursuant to an ASIC Class Order 98/1418 dated 13 August 1998, relief was granted to the wholly owned subsidiaries listed below from
the requirement to prepare, have audited and lodge financial reports.
It is a condition of the Class Order that the Company and each of the subsidiaries enter into a Deed of Cross Guarantee. The effect of
the Deed is that the Company guarantees to each creditor, payment in full of any debt in the event of winding up of any subsidiaries
under certain provisions of the Corporations Act 2001. If a winding up occurs under other provisions of the Law, the Company will only
be liable in the event that after six months any creditor has not been paid in full. The subsidiaries have also given similar guarantees in
the event that the Company is wound up.
Bocar Pty Ltd (formerly Bendigo Re-locatable Buildings Pty Ltd)
BRB Modular Pty Ltd
Camec Pty Ltd
Fleetwood Recreational Vehicles Pty Ltd
Fleetwood Finance (WA) Pty Ltd
Fleetwood Pty Ltd
Flexiglass Challenge Pty Ltd
Windsor Caravans Pty Ltd
A consolidated statement of financial performance and financial position comprising the Company and its subsidiaries, which are party
to the Deed, after eliminating all transactions between parties to the Deed of Cross Guarantee is set out below:
Statement of profit or loss
and other comprehensive income
Continuing operations
Sales revenue
Other income
Materials used
Sub-contract costs
Employee benefits expense
Operating leases
Other expenses
Profit before interest, tax, depreciation and amortisation and impairment
Depreciation and amortisation expense
Profit before interest, tax and impairment
Impairment of goodwill
Profit before interest and tax
Finance costs
Profit before income tax expense for the year
Income tax expense
Profit from continuing operations for the year
Discontinued operations
Loss from discontinued operation
Total profit and other comprehensive income for the year
2015
$ '000
2014
$ '000
296,684
570
(97,657)
(68,181)
(57,822)
(10,435)
(27,085)
360,337
1,023
(142,308)
(90,935)
(65,493)
(10,884)
(23,357)
36,074
28,383
(28,960)
(17,551)
7,114
10,832
(2,097)
(5,000)
5,017
(3,959)
1,058
(592)
5,832
(2,227)
3,605
(2,633)
466
972
-
466
(490)
482
35
FLEETWOOD CORPORATIONANNUAL REPORT 2015 27 Deed of cross guarantee (continued)
Statement of financial position
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other financial assets
Tax assets
Non-current assets held for sale
Total current assets
Non-current assets
Investments
Property, plant and equipment
Goodwill
Intangible assets
Inventories
Deferred tax assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Interest bearing liabilities
Tax liabilities
Provisions
Other financial liabilities
Total current liabilities
Non-current liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Retained earnings
Total equity
2015
$ '000
2014
$ '000
6,121
95,211
43,179
206
-
-
144,717
88
107,457
61,786
5,166
-
4,830
5,980
45,562
41,995
-
99
51
93,687
74
109,434
59,457
4,844
45,745
4,400
179,327
223,954
324,044
317,641
43,152
62,500
900
5,575
-
37,103
62,411
-
3,702
139
112,127
103,355
971
971
3,232
3,232
113,098
106,587
210,946
211,054
194,760
(257)
16,443
194,092
(219)
17,181
210,946
211,054
28 Financial instruments
Capital management
The Group manages capital to ensure it will be able to continue as a going concern, while maximising returns to shareholders through
optimisation of debt and equity balances. The categories of financial instruments of the entity are apparent from the statement of
financial position. The Group’s overall strategy remains unchanged since 2014.
The capital structure of the Group includes borrowings and related repayment terms (as detailed in note 18), cash and cash equivalents
(as detailed in note 8) and equity attributable to equity holders of the parent, comprising issued capital, reserves and retained earnings
(as detailed in notes 23, 24 and 25).
Operating cash flows are used to maintain and expand the Group’s operating assets, make payments of tax and dividends and to repay
debt. Group policy is to borrow centrally to meet funding requirements. The Group does not have a target gearing ratio.
The group has requirements imposed by its financier pertaining to gearing ratio, shareholders’ funds and interest cover. There was no
instance of non-compliance with these requirements during the period.
36
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
27 Deed of cross guarantee (continued)
Statement of financial position
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other financial assets
Tax assets
Non-current assets held for sale
Total current assets
Non-current assets
Investments
Property, plant and equipment
Goodwill
Intangible assets
Inventories
Deferred tax assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Interest bearing liabilities
Tax liabilities
Provisions
Other financial liabilities
Total current liabilities
Non-current liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Retained earnings
Total equity
28 Financial instruments
Capital management
The Group manages capital to ensure it will be able to continue as a going concern, while maximising returns to shareholders through
optimisation of debt and equity balances. The categories of financial instruments of the entity are apparent from the statement of
financial position. The Group’s overall strategy remains unchanged since 2014.
The capital structure of the Group includes borrowings and related repayment terms (as detailed in note 18), cash and cash equivalents
(as detailed in note 8) and equity attributable to equity holders of the parent, comprising issued capital, reserves and retained earnings
(as detailed in notes 23, 24 and 25).
Operating cash flows are used to maintain and expand the Group’s operating assets, make payments of tax and dividends and to repay
debt. Group policy is to borrow centrally to meet funding requirements. The Group does not have a target gearing ratio.
The group has requirements imposed by its financier pertaining to gearing ratio, shareholders’ funds and interest cover. There was no
instance of non-compliance with these requirements during the period.
2015
$ '000
2014
$ '000
28 Financial instruments (continued)
Financial risk management objectives
6,121
95,211
43,179
206
-
-
5,980
45,562
41,995
-
99
51
144,717
93,687
88
107,457
61,786
5,166
-
4,830
74
109,434
59,457
4,844
45,745
4,400
179,327
223,954
324,044
317,641
43,152
62,500
900
5,575
-
37,103
62,411
-
3,702
139
112,127
103,355
971
971
3,232
3,232
113,098
106,587
210,946
211,054
194,760
(257)
16,443
194,092
(219)
17,181
210,946
211,054
Financial instruments comprise cash, receivables, payables, hire purchase creditors, and bank loans. All financial instruments except
forward foreign exchange contracts are carried at amortised cost. The Group manages its exposure to key financial risks, including
interest rate and currency risk in accordance with the Group financial risk management policy. The objective of the policy is to support
delivery of financial targets whilst providing financial security.
The main financial instrument risks are interest rate, foreign currency, credit and liquidity risk. Different methods are used to measure
and manage risks including monitoring exposure to interest and foreign exchange rates and assessments of market forecasts for
interest and foreign exchange rates. Ageing analysis and monitoring of specific credit allowances are undertaken to manage credit risk.
Liquidity risk is monitored through the development of rolling cash flow forecasts.
Foreign currency risk management
The Group undertakes transactions denominated in foreign currencies. Consequently, exposures to exchange rate fluctuations arise.
Exchange rate exposures are managed within approved policy parameters utilising forward exchange contracts. The Group is mainly
exposed to United States Dollars, the Euro and Chinese Yuan Renminbi.
Foreign exchange sensitivity analysis to a 10% movement in the Australian Dollar
- 10%
+ 10%
USD
$ '000
Euro
$ '000
Renminbi
$ '000
Total
$ '000
USD
$ '000
Euro
$ '000
Renminbi
$ '000
Total
$ '000
2015 Profit
2014 Profit
2015 Equity
2014 Equity
(720)
(212)
(720)
(212)
(197)
(117)
(197)
(117)
(42)
-
(42)
-
(958)
(279)
(958)
(279)
720
212
720
212
197
117
197
117
42
-
42
-
958
279
958
279
Forward foreign exchange contracts
Group policy is to enter into forward foreign exchange contracts to manage the risk associated with anticipated purchases denominated
in foreign currency. Anticipated purchases are assessed out to six months from the date the contract is entered into, with 40-60% of the
anticipated exposure covered. Basis adjustments are made to the carrying amounts of non-financial items when the anticipated
purchase transaction takes place.
Outstanding
contracts
Buy USD
Less than 3 months
3 to 6 months
Buy Euro
Less than 3 months
3 to 6 months
Buy Renminbi
Less than 3 months
3 to 6 months
Average exchange rate
Foreign Currency
Notional Value
Fair Value
2015
$
0.77
0.76
0.68
0.68
4.78
4.77
2014
$
0.88
0.93
0.66
0.68
-
-
2015
FC '000
2014
FC '000
3,110
2,399
1,534
450
717
640
980
960
504
300
-
-
2015
$ '000
4,057
3,144
1,047
940
205
201
2014
$ '000
1,743
484
764
441
-
-
2015
$ '000
96
69
25
15
-
-
2014
$ '000
(104)
(4)
(26)
(5)
-
-
205
(139)
During 2015 a gain of $205,000 was recognised in profit and loss pertaining to forward exchange contracts (2014: $139,000 loss).
Interest rate risk management
Interest rate risk arises from borrowings. Group policy is to manage finance costs by using a mix of fixed and variable rate debt after
considering market forecasts.
37
FLEETWOOD CORPORATIONANNUAL REPORT 2015 28 Financial instruments (continued)
Interest rate sensitivity analysis to interest rate risk
Financial assets
Cash and cash equivalents - 2015
Cash and cash equivalents - 2014
Financial liabilities
Borrowings - 2015
Borrowings - 2014
2015
2014
Credit risk management
Carrying
amount
$ '000
6,634
6,405
62,500
62,411
- 75 bps
+ 75 bps
Profit
$ '000
Equity
$ '000
Profit
$ '000
Equity
$ '000
(50)
(48)
469
468
419
420
(50)
(48)
469
468
419
420
50
48
(469)
(468)
(419)
(420)
50
48
(469)
(468)
(419)
(420)
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. Group
policy is to deal with creditworthy counterparties and obtain sufficient collateral where appropriate as a means of mitigating the risk of
financial loss from default. Reviews of customer creditworthiness are undertaken before payment and delivery terms are offered. The
review assesses credit quality of the customer, taking into account its financial position, past experience, industry reputation and other
factors. Purchase limits are established for each customer, and compliance with credit limits is regularly monitored. Customers that fail
to meet benchmark creditworthiness may transact with the Group only on a prepayment basis. Sales to retail customers are required to
be settled in cash or by using major credit cards, mitigating credit risk.
The carrying amount of financial assets recorded in the financial statements represents the Group’s maximum exposure to credit risk.
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board of Directors, who have built an appropriate liquidity risk
framework for the management of short, medium and long-term funding. Liquidity risk is managed by maintaining adequate reserves
and banking facilities, by monitoring forecast and actual cash flows and by matching the maturity profiles of financial assets and
liabilities. Note 19 lists unused facilities that the Group has at its disposal to reduce liquidity risk. The remaining contractual maturities
of the Group are:
3 months or less: Trade and other payables as disclosed at Note 16. Trade and other payables do not attract an interest
charge and are expected to be settled within 60 days of year end.
3 months or less: Bank Loans as disclosed at Note 19. Weighted average interest rate 3.22% (2014: 3.57%). Loans are
expected to be settled within three months of year end.
12 months or less: Hire purchase creditors – 2015 $Nil (2014: $11,407). The weighted average interest rate in 2014 was
7.47%.
There were no contractual maturities greater than 12 months as at 30 June 2015.
Fair value of financial assets and liabilities
The fair value of financial assets and liabilities recognised in the statement of financial position is based on cash flows due from
customers or payable to suppliers. The cash flows have not been discounted to their present value, except as disclosed in the table
below. The carrying values approximate fair value. The fair values of financial instruments are derived from quoted prices (unadjusted)
in active markets for identical assets or liabilities. There are clearly observable quoted prices for all financial instruments held by the
Group. Some of the Group’s financial assets and liabilities are measured at fair value and the end of each reporting period. Information
about how the fair values of these financial liabilities are determined (in particular, the valuation techniques and inputs used).
Fair value as at
2015
2014
Fair value
Hierarchy
Valuation technique and
key inputs
Significant
unobservable
inputs
Relationship of
unobservable
inputs to fair
value
Financial assets
Foreign currency
forward contracts
Financial
liabilities
Foreign currency
forward contracts
$205,925
Nil
Level 2
Nil
$139,408
Level 2
38
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
cash
flow.
Discounted
flows are
Future cash
on
estimated
based
forward exchange
rates
and contract forward rates,
discounted to their present
value.
Discounted
flow.
Future cash
flows are
estimated
based
on
rates
forward exchange
and contract forward rates,
discounted to their present
value.
cash
N/A
N/A
N/A
N/A
28 Financial instruments (continued)
Interest rate sensitivity analysis to interest rate risk
Financial assets
Cash and cash equivalents - 2015
Cash and cash equivalents - 2014
Financial liabilities
Borrowings - 2015
Borrowings - 2014
2015
2014
Credit risk management
Carrying
amount
$ '000
6,634
6,405
62,500
62,411
- 75 bps
+ 75 bps
Profit
$ '000
Equity
$ '000
Profit
$ '000
Equity
$ '000
(50)
(48)
469
468
419
420
(50)
(48)
469
468
419
420
50
48
(469)
(468)
(419)
(420)
50
48
(469)
(468)
(419)
(420)
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. Group
policy is to deal with creditworthy counterparties and obtain sufficient collateral where appropriate as a means of mitigating the risk of
financial loss from default. Reviews of customer creditworthiness are undertaken before payment and delivery terms are offered. The
review assesses credit quality of the customer, taking into account its financial position, past experience, industry reputation and other
factors. Purchase limits are established for each customer, and compliance with credit limits is regularly monitored. Customers that fail
to meet benchmark creditworthiness may transact with the Group only on a prepayment basis. Sales to retail customers are required to
be settled in cash or by using major credit cards, mitigating credit risk.
The carrying amount of financial assets recorded in the financial statements represents the Group’s maximum exposure to credit risk.
Liquidity risk management
Ultimate responsibility for liquidity risk management rests with the Board of Directors, who have built an appropriate liquidity risk
framework for the management of short, medium and long-term funding. Liquidity risk is managed by maintaining adequate reserves
and banking facilities, by monitoring forecast and actual cash flows and by matching the maturity profiles of financial assets and
liabilities. Note 19 lists unused facilities that the Group has at its disposal to reduce liquidity risk. The remaining contractual maturities
of the Group are:
7.47%.
3 months or less: Trade and other payables as disclosed at Note 16. Trade and other payables do not attract an interest
charge and are expected to be settled within 60 days of year end.
3 months or less: Bank Loans as disclosed at Note 19. Weighted average interest rate 3.22% (2014: 3.57%). Loans are
expected to be settled within three months of year end.
12 months or less: Hire purchase creditors – 2015 $Nil (2014: $11,407). The weighted average interest rate in 2014 was
There were no contractual maturities greater than 12 months as at 30 June 2015.
Fair value of financial assets and liabilities
The fair value of financial assets and liabilities recognised in the statement of financial position is based on cash flows due from
customers or payable to suppliers. The cash flows have not been discounted to their present value, except as disclosed in the table
below. The carrying values approximate fair value. The fair values of financial instruments are derived from quoted prices (unadjusted)
in active markets for identical assets or liabilities. There are clearly observable quoted prices for all financial instruments held by the
Group. Some of the Group’s financial assets and liabilities are measured at fair value and the end of each reporting period. Information
about how the fair values of these financial liabilities are determined (in particular, the valuation techniques and inputs used).
Fair value as at
Valuation technique and
Significant
Fair value
Hierarchy
key inputs
2015
2014
unobservable
inputs
Relationship of
unobservable
inputs to fair
value
$205,925
Nil
Level 2
N/A
N/A
Financial assets
Foreign currency
forward contracts
Financial
liabilities
Foreign currency
forward contracts
Discounted
cash
flow.
Future cash
flows are
estimated
based
on
forward exchange
rates
and contract forward rates,
discounted to their present
value.
Discounted
cash
flow.
Future cash
flows are
estimated
based
on
forward exchange
rates
and contract forward rates,
discounted to their present
value.
Nil
$139,408
Level 2
N/A
N/A
29 Notes to the consolidated statement of cash flows
29.1 Reconciliation of profit from ordinary activities after income tax to net
cash provided by operating activities
Operating profit after income tax
Items classified as investing activities:
(Gain) / loss on sale of non-current assets
Non-cash items:
Equity settled share-based payments
Depreciation and amortisation expense - continuing operations
Depreciation and amortisation expense - discontinued operations
Written down value of rental fleet sold
Impairment of plant and equipment
Impairment of intangible assets
Impairment of Goodwill
Changes in assets and liabilities during the year:
Decrease (Increase) in inventories
(Increase) decrease in trade and other receivables
Decrease in other financial assets
Increase (decrease) in trade and other payables
Decrease in provisions
Increase (decrease) in income taxes payable
Increase in deferred taxes receivable
(Decrease) increase in other financial liabilities
2015
$ '000
2014
$ '000
176
76
140
(109)
468
29,113
-
6,313
1,300
1,080
2,097
45,003
(49,543)
155
5,819
(403)
1,014
(426)
(139)
945
17,624
79
8,984
-
-
5,000
(3,736)
7,411
4,069
(7,314)
(598)
(1,202)
(424)
139
Net cash provided by operating activities
42,167
30,944
29.2 Non-cash financing and investing activities
During the year, dividends of $197,584 (2014: $148,824) were reinvested in the Company as 98,201 (2014: 58,592) fully paid ordinary
shares pursuant to the Dividend Reinvestment Plan.
The Company received dividends of $12,047,591 (2014: $25,384,307) from controlled entities by way of an increase in controlled
entities loan accounts.
30 Contingent liabilities
Under the terms of the Deed of Cross Guarantee, the Company has guaranteed the repayment of all current and non-current liabilities
totalling $113,098,184 (2014: $106,448,000) in the event any of the entities which are party to the Deed are wound up.
The Directors are not aware of any circumstances or information that would lead them to believe these liabilities will crystallise and
consequently no provisions are included in the financial statements in respect of these matters.
Certain claims arising out of construction and insurance contracts have been made by or against controlled entities in the ordinary
course of business, some of which involved litigation or adjudication. The Directors do not consider the outcome of any of these claims
will have a material adverse impact on the financial position of the consolidated entity.
39
FLEETWOOD CORPORATIONANNUAL REPORT 2015 31 Particulars relating to controlled entities
Fleetwood Corporation Limited (Ultimate parent entity)
Controlled entities
Place of
Incorporation
Principal Activities
Bocar Pty Ltd (formerly Bendigo Re-locatable
Buildings Pty Ltd)
Australia
BRB Modular Pty Ltd
Camec Pty Ltd
Australia
Australia
Fleetwood Recreational Vehicles Pty Ltd
Australia
Fleetwood Pty Ltd
Australia
Dormant (Bocar products are
traded through Flexiglass
Challenge Pty Ltd)
Accommodation solutions provider
to the resources, education and
affordable housing sectors.
Manufacturer and distributor of
parts and accessories to the
recreational vehicles industry.
Manufacturer of caravans, pop-
tops and campers distributed
through a national dealer network.
Accommodation solutions provider
to the resources, education and
affordable housing sectors.
Fleetwood Finance (WA) Pty Ltd
Australia
Dormant
Flexiglass Challenge Pty Ltd
Australia
Distributor of canopies and trays
for commercial vehicles.
Windsor Caravans Pty Ltd
Australia
Dormant
Flexiglass Challenge Industries (NZ) Limited
New Zealand
Dormant
Interest held (%)
2015
2014
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
Camec NZ Limited
New Zealand
Manufacturer and distributor of
parts and accessories to the
recreational vehicles industry.
100
100
Fleetwood Corporation Limited is the head entity within the tax consolidated group. All companies incorporated in Australia are
members of the tax consolidated group.
32 Related parties
Directors
The names of each person holding the position of Director of Fleetwood Corporation Limited during the financial year were P Gunzburg,
M Hardy, G Tate, J Bond, B Denison. Details of directors’ remuneration is set out in the Remuneration Report contained in the
Directors’ Report.
No Director has entered into a material contract with the Company or the consolidated entity during and since the end of the financial
year and there were no material contracts involving directors’ interests existing at year-end.
Directors of the Company or its controlled entities may purchase goods from the consolidated entity. These purchases are on the same
terms and conditions as those entered into by other consolidated entity employees.
Further information on remuneration of key management personnel can be found in the Remuneration Report.
Key management personnel
Aggregate compensation of the key management personnel of the consolidated entity and the Company for the year:
Short-term employee benefits
Post-employment benefits
Other long term benefits
Share-based payments
2015
$
2014
$
2,262,070
160,706
73,971
97,833
2,390,377
151,464
25,315
166,697
2,594,580
2,733,853
Transactions between Fleetwood Corporation and its related parties
During the financial year subsidiaries of the parent company made dividend payments totaling $12,047,591 (2014: $25,384,307) to the
parent entity. Non-current loans totaling $254,176,873 (2014: $218,928,724) repayable to the parent are outstanding at reporting date.
Transactions and balances between the company and its subsidiaries were eliminated in the preparation of the consolidated financial
statements of the Group.
40
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
31 Particulars relating to controlled entities
Fleetwood Corporation Limited (Ultimate parent entity)
Controlled entities
Place of
Incorporation
Principal Activities
Interest held (%)
2015
2014
Bocar Pty Ltd (formerly Bendigo Re-locatable
Buildings Pty Ltd)
Australia
traded through Flexiglass
100
100
BRB Modular Pty Ltd
Australia
to the resources, education and
100
100
Camec Pty Ltd
Australia
parts and accessories to the
100
100
Fleetwood Recreational Vehicles Pty Ltd
Australia
tops and campers distributed
100
100
Dormant (Bocar products are
Challenge Pty Ltd)
Accommodation solutions provider
affordable housing sectors.
Manufacturer and distributor of
recreational vehicles industry.
Manufacturer of caravans, pop-
through a national dealer network.
Accommodation solutions provider
Australia
to the resources, education and
affordable housing sectors.
Fleetwood Pty Ltd
Fleetwood Finance (WA) Pty Ltd
Australia
Dormant
Flexiglass Challenge Pty Ltd
Australia
Distributor of canopies and trays
for commercial vehicles.
Windsor Caravans Pty Ltd
Australia
Dormant
Flexiglass Challenge Industries (NZ) Limited
New Zealand
Dormant
100
100
100
100
100
100
100
100
100
100
Camec NZ Limited
New Zealand
parts and accessories to the
100
100
Manufacturer and distributor of
recreational vehicles industry.
Fleetwood Corporation Limited is the head entity within the tax consolidated group. All companies incorporated in Australia are
members of the tax consolidated group.
32 Related parties
Directors
The names of each person holding the position of Director of Fleetwood Corporation Limited during the financial year were P Gunzburg,
M Hardy, G Tate, J Bond, B Denison. Details of directors’ remuneration is set out in the Remuneration Report contained in the
Directors’ Report.
No Director has entered into a material contract with the Company or the consolidated entity during and since the end of the financial
year and there were no material contracts involving directors’ interests existing at year-end.
Directors of the Company or its controlled entities may purchase goods from the consolidated entity. These purchases are on the same
terms and conditions as those entered into by other consolidated entity employees.
Further information on remuneration of key management personnel can be found in the Remuneration Report.
Key management personnel
Aggregate compensation of the key management personnel of the consolidated entity and the Company for the year:
Short-term employee benefits
Post-employment benefits
Other long term benefits
Share-based payments
Transactions between Fleetwood Corporation and its related parties
During the financial year subsidiaries of the parent company made dividend payments totaling $12,047,591 (2014: $25,384,307) to the
parent entity. Non-current loans totaling $254,176,873 (2014: $218,928,724) repayable to the parent are outstanding at reporting date.
Transactions and balances between the company and its subsidiaries were eliminated in the preparation of the consolidated financial
statements of the Group.
2015
$
2014
$
2,262,070
2,390,377
160,706
73,971
97,833
151,464
25,315
166,697
2,594,580
2,733,853
33 Parent entity disclosures
33.1 Financial position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Equity
Issued capital
Retained earnings
Total equity
33.2 Financial performance
Profit for the year
Other comprehensive income
Total comprehensive income
2015
$ '000
2014
$ '000
6,363
273,124
10,604
261,076
279,487
271,680
65,201
573
63,844
452
65,774
64,296
194,762
18,951
194,096
13,288
213,713
207,384
6,875
-
37,487
-
6,875
(12,305)
33.3 Guarantees entered into by the parent entity in relation to debts of
its subsidiaries
Note
Guarantee provided under the deed of cross guarantee
30
113,098
106,587
33.4 Commitments
Operating lease commitments
Within one year
One year or later and no later than five years
Later than five years
405
239
-
644
364
606
-
970
The accounting policies of the parent entity, which have been applied in determining the financial information above are the same as
those applied in the consolidated financial statements.
Under the terms of the Deed of Cross Guarantee, the Company has guaranteed the repayment of all current and non-current liabilities
totaling $113,098,184 (2014: $106,448,000) in the event any of the entities which are party to the Deed are wound up.
The parent entity had no other contingent liabilities as at 30 June 2015 (2014: nil).
41
FLEETWOOD CORPORATIONANNUAL REPORT 2015 34 Business Combination
Fleetwood Corporation Limited entered into an agreement to purchase the assets of Bocar Pty Ltd (Bocar) on 12 August 2014.
Bocar was established over 25 years ago and is today a leading New South Wales based aluminium tray and accessory distributer to
the automotive sector. The acquisition provides Fleetwood subsidiary Flexiglass with increased scale in New South Wales.
The fair value of the identifiable assets of Bocar at the date of acquisition, the total cost and cash flows of the acquisition were as
follows.
Property, plant and equipment
Inventory
Total Assets
Fair value of identifiable net assets acquired
Book value of net assets (including working capital and plant and equipment)
Goodwill
Acquisition cost
There were no liabilities assumed as part of the transaction
Cash paid
Direct costs relating to the acquisition (recorded in the income statement)
Net consolidated cash outflow
The cash flow on acquisition is as follows:
Net cash acquired with the business
Direct costs relating to the acquisition
Cash paid
Net consolidated cash outflow
Carrying
Value
$ '000
Fair value
recognised
$ '000
89
251
340
340
89
251
340
340
340
4,425
4,765
4,765
150
4,915
-
150
4,765
4,915
The consideration paid for the combination included amounts in relation to the benefit of expected synergies, future market growth,
customer relationships and assembled workforce of Bocar. Fair values of identifiable intangibles have not been determined at the date
of this report for the reasons outlined above.
The acquired business contributed revenues of $3,136,435 and net profit after tax of $704,479 (excluding incremental interest) to the
Group for the period 12 August 2014 to 30 June 2015. Had Bocar been acquired at 1 July 2014, Group revenue would have been
$302,365,079, and the profit attributable to members of the parent entity would have been $276,306. The directors have determined
these 'pro-forma' numbers to represent an approximate measure of the performance of the group on an annualised basis.
In determining the 'pro-forma' revenue and profit of the Group had Bocar been acquired at 1 July 2014, the directors have extrapolated
the revenue and earnings for Bocar for the period from acquisition date to 30 June 2015 over a 12 month period, and added them to
the revenues and profits of the remainder of the group for the year.
42
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
34 Business Combination
35 Discontinued operation
Fleetwood Corporation Limited entered into an agreement to purchase the assets of Bocar Pty Ltd (Bocar) on 12 August 2014.
On 2 November 2012 the Company closed its Victorian caravan manufacturing operations. There were no transactions for the
discontinued operation in the current year.
Bocar was established over 25 years ago and is today a leading New South Wales based aluminium tray and accessory distributer to
the automotive sector. The acquisition provides Fleetwood subsidiary Flexiglass with increased scale in New South Wales.
The fair value of the identifiable assets of Bocar at the date of acquisition, the total cost and cash flows of the acquisition were as
35.1 Financial performance
follows.
Revenue
Expenses
Loss from discontinued operation before income tax
Attributable income tax
Loss from discontinued operation after income tax
35.2 Cashflow information
Net cash outflows from operating activities
Net cash inflows (outflows) from investing activities
Net cash outlfow from discontinued operations
35.3 Loss per share from discontinued operations
Diluted earnings per share (cents)
Basic earnings per share (cents)
2015
$ '000
2014
$ '000
-
-
-
-
-
-
-
-
-
-
1,288
(1,988)
(700)
210
(490)
(684)
-
(684)
(0.8)
(0.8)
Revenue relates to the sale of caravans manufactured at the Victorian caravan manufacturing operation prior to its closure.
36 Significant events after the reporting period
On 20 July 2015, Fleetwood and the West Australian Department of Housing finalised negotiations relating to the Osprey Village
(Village), and executed documents constituting the final commercial terms as further described in the ASX Announcement of 23 July
2015. Under the terms of the agreement, the West Australian Department of Housing purchased the Village from Fleetwood for $62.2m
(including GST). Under the terms of the agreement, Fleetwood will receive an ongoing income stream from managing the Village for the
next 14 years.
The receivable created by the sale transaction has a term of 14 years and was subsequently assigned to Westpac for an upfront
payment of $62.2m.
On 3 August 2015 the Company paid $3.9m (including GST) to a subcontractor pursuant to a BCIPA adjudication in Queensland. The
payment relates to a matter which is unresolved. The matter has been appropriately provided for at 30 June and Fleetwood intends to
vigorously pursue recovery of the amount.
Except for those matters outlined above, there were no material events subsequent to the reporting period.
Property, plant and equipment
Inventory
Total Assets
Fair value of identifiable net assets acquired
Book value of net assets (including working capital and plant and equipment)
Goodwill
Acquisition cost
Cash paid
There were no liabilities assumed as part of the transaction
Direct costs relating to the acquisition (recorded in the income statement)
Net consolidated cash outflow
The cash flow on acquisition is as follows:
Net cash acquired with the business
Direct costs relating to the acquisition
Cash paid
Net consolidated cash outflow
Carrying
Fair value
Value
recognised
$ '000
$ '000
89
251
340
340
89
251
340
340
340
4,425
4,765
4,765
150
4,915
-
150
4,765
4,915
The consideration paid for the combination included amounts in relation to the benefit of expected synergies, future market growth,
customer relationships and assembled workforce of Bocar. Fair values of identifiable intangibles have not been determined at the date
of this report for the reasons outlined above.
The acquired business contributed revenues of $3,136,435 and net profit after tax of $704,479 (excluding incremental interest) to the
Group for the period 12 August 2014 to 30 June 2015. Had Bocar been acquired at 1 July 2014, Group revenue would have been
$302,365,079, and the profit attributable to members of the parent entity would have been $276,306. The directors have determined
these 'pro-forma' numbers to represent an approximate measure of the performance of the group on an annualised basis.
In determining the 'pro-forma' revenue and profit of the Group had Bocar been acquired at 1 July 2014, the directors have extrapolated
the revenue and earnings for Bocar for the period from acquisition date to 30 June 2015 over a 12 month period, and added them to
the revenues and profits of the remainder of the group for the year.
43
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Directors’ Report
Fleetwood Corporation Limited
The Directors of Fleetwood Corporation Limited present their report for the year ended 30 June 2015.
Directors and Officers
The names, qualifications, experience, special responsibilities and previous directorships for the last 3 years of the Directors who are in
office at the date of the report or have been appointed subsequent to the date of the report are disclosed on page 5 of this Annual
Report.
Principal Activities
The principal activities of the entities in the Group during the financial year were:
design, manufacture, sale and rental of manufactured accommodation;
manufacture and sale of caravans, parts and accessories; and
distributor of canopies and trays for commercial vehicles.
Operations
A review of operations for the year is contained in the Managing Director’s Review. Results of operations for the year are contained in
the Financial Report.
Financial Position
A summary of the financial position of the Group is disclosed on page 4 of this Annual Report.
State of Affairs
During the financial year there was no significant change in the state of affairs of the consolidated entity.
Significant Events After the Reporting Period
On 20 July 2015, Fleetwood and the West Australian Department of Housing finalised negotiations relating to the Osprey Village
(Village), and executed documents as further described in the ASX Announcement of 23 July 2015. Further information is contained in
note 36 to the financial statements.
On 3 August 2015, the Company paid an amount of $3.9m (including GST) to a subcontractor pursuant to a BCIPA adjudication in
Queensland. The payment relates to matters which are unresolved. The matter has been appropriately provided for at 30 June 2015.
Further information is contained in note 36 to the financial statements.
Other than the above, there were no significant events which occurred after the reporting period.
Future Developments
The consolidated entity will continue to pursue increasing both profitability and market share in its major business sectors. Further
information as to likely developments and expected future results are disclosed in the Managing Director’s Review.
Dividends
A final dividend for the year to 30 June 2014 of 2 cents per ordinary share was paid on 30 September 2014. Dividends paid and
declared for the year to 30 June 2014 are disclosed in note 6 to the financial statements. All dividends paid or declared by the
Company since the end of the previous financial year were 100% franked at the income tax rate of 30%.
No interim or final dividend was declared or paid with respect to the year ended 30 June 2015.
Share Options
Details of all share based payment arrangements in existence at 30 June 2015 and unissued shares the subject of options at the date of
this Annual Report and shares issued pursuant to the exercise of options during or since the end of the year are disclosed in note 22 to
the financial statements. No options have been issued subsequent to year end. 23,143 options have been forfeited subsequent to year
end. Details of unissued shares the subject of options as at the date of this report are outlined below.
Employee Options
Issue date
Total unissued shares under option
Exercise price ($)
Expiry date
Executive Options
Issue date
Total unissued shares under option
Exercise price ($)
Expiry date
31/10/2010
233,881
8.02
30/10/2015
2/09/2011
252,093
8.68
1/09/2016
29/08/2012
297,980
9.39
29/08/2017
30/08/2013
407,100
2.56
30/08/2018
31/10/2010
81,666
8.02
30/10/2015
2/09/2011
96,775
8.68
1/09/2016
20/02/2013
130,000
10.57
20/02/2018
30/08/2013
270,000
2.88
30/08/2018
The Employee and Executive Option Plans have been replaced by new long term incentive plans, approved by shareholders at the
2014 annual general meeting. Since that time, no options have been issued to employees or executives pursuant to those plans. With
respect to the above options no voting or dividend rights attach to the options. Details of options previously granted to Directors,
executives and key management personnel are contained in note 22 to the financial statements and in the Remuneration Report.
44
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
The Directors of Fleetwood Corporation Limited present their report for the year ended 30 June 2015.
The names, qualifications, experience, special responsibilities and previous directorships for the last 3 years of the Directors who are in
office at the date of the report or have been appointed subsequent to the date of the report are disclosed on page 5 of this Annual
The principal activities of the entities in the Group during the financial year were:
design, manufacture, sale and rental of manufactured accommodation;
manufacture and sale of caravans, parts and accessories; and
distributor of canopies and trays for commercial vehicles.
A review of operations for the year is contained in the Managing Director’s Review. Results of operations for the year are contained in
A summary of the financial position of the Group is disclosed on page 4 of this Annual Report.
During the financial year there was no significant change in the state of affairs of the consolidated entity.
Significant Events After the Reporting Period
On 20 July 2015, Fleetwood and the West Australian Department of Housing finalised negotiations relating to the Osprey Village
(Village), and executed documents as further described in the ASX Announcement of 23 July 2015. Further information is contained in
note 36 to the financial statements.
On 3 August 2015, the Company paid an amount of $3.9m (including GST) to a subcontractor pursuant to a BCIPA adjudication in
Queensland. The payment relates to matters which are unresolved. The matter has been appropriately provided for at 30 June 2015.
Further information is contained in note 36 to the financial statements.
Other than the above, there were no significant events which occurred after the reporting period.
The consolidated entity will continue to pursue increasing both profitability and market share in its major business sectors. Further
information as to likely developments and expected future results are disclosed in the Managing Director’s Review.
A final dividend for the year to 30 June 2014 of 2 cents per ordinary share was paid on 30 September 2014. Dividends paid and
declared for the year to 30 June 2014 are disclosed in note 6 to the financial statements. All dividends paid or declared by the
Company since the end of the previous financial year were 100% franked at the income tax rate of 30%.
No interim or final dividend was declared or paid with respect to the year ended 30 June 2015.
Details of all share based payment arrangements in existence at 30 June 2015 and unissued shares the subject of options at the date of
this Annual Report and shares issued pursuant to the exercise of options during or since the end of the year are disclosed in note 22 to
the financial statements. No options have been issued subsequent to year end. 23,143 options have been forfeited subsequent to year
end. Details of unissued shares the subject of options as at the date of this report are outlined below.
Directors’ Report
Fleetwood Corporation Limited
Directors and Officers
Report.
Principal Activities
Operations
the Financial Report.
Financial Position
State of Affairs
Future Developments
Dividends
Share Options
Employee Options
Issue date
Exercise price ($)
Expiry date
Executive Options
Issue date
Exercise price ($)
Expiry date
Total unissued shares under option
Total unissued shares under option
31/10/2010
2/09/2011
29/08/2012
30/08/2013
233,881
8.02
252,093
8.68
297,980
9.39
407,100
2.56
30/10/2015
1/09/2016
29/08/2017
30/08/2018
31/10/2010
2/09/2011
20/02/2013
30/08/2013
81,666
8.02
96,775
8.68
130,000
10.57
270,000
2.88
30/10/2015
1/09/2016
20/02/2018
30/08/2018
The Employee and Executive Option Plans have been replaced by new long term incentive plans, approved by shareholders at the
2014 annual general meeting. Since that time, no options have been issued to employees or executives pursuant to those plans. With
respect to the above options no voting or dividend rights attach to the options. Details of options previously granted to Directors,
executives and key management personnel are contained in note 22 to the financial statements and in the Remuneration Report.
Indemnification of Directors and Officers
The Company has indemnified current and former Directors and officers of the Company against all liabilities to another person (other
than the Company or a related body corporate) that may arise from their position as Director or officer of the Company, except where
the liability arises out of conduct involving a lack of good faith. The agreement stipulates that the Company will meet the full amount of
any such liabilities, including costs and expenses.
Insurance premiums in this regard relate to costs and expenses incurred by the relevant Directors and 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.
The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.
The Company has not otherwise, during or since the end of the financial year, except to the extent permitted by law, indemnified or
agreed to indemnify an auditor of the Company or any related body corporate against a liability incurred as an auditor.
Directors’, Audit Committee and Remuneration Committee Meetings
Number of Board, Audit Committee and Remuneration Committee meetings held and attended by each Director of the Company during
the financial year are as follows:
Peter Gunzburg
Michael Hardy
Greg Tate
John Bond
Brad Denison
Board
Held
Attended
Audit Committee
Attended
Held
Remuneration Committee
Held
Attended
9
9
9
9
9
9
8
9
9
9
4
4
4
4
4
4
4
4
4
4*
2
2
2
2
2
2
2
2
2
1*
*By invitation of the Audit Committee and Remuneration Committee
Directors’ Shareholdings
The relevant interest of each Director in Company shares and options at the date of this report, as notified by the Directors to the ASX in
accordance with s205G(1) of the Corporations Act 2001 are as follows:
Michael Hardy
Greg Tate
John Bond
Brad Denison
Remuneration Report
Number of
shares
16,975
6,581,271
20,000
45,464
Number of
share units
-
-
-
170,000
Number of
options
-
-
-
215,837
The Remuneration Committee is responsible for determining the remuneration of Board members, executives and key management
personnel. All non-executive Directors are members of the Remuneration Committee, with the majority being independent of the
Company and management. Mr. P. Gunzburg is the chairman of the Remuneration Committee.
During the year the Remuneration Committee reviewed:
conditions of service and remuneration of the Directors, executives, and key management personnel;
remuneration policies of the Group;
proposals for new issues under, or changes to, the Company’s long term incentive plans;
succession plans for senior management; and
other related matters.
The Remuneration Committee has authority to seek independent legal, financial, remuneration or other advice it considers necessary to
achieve its objectives and fulfil its responsibilities. In doing so it may invite external consultants and/or executives to its meetings to
seek input on the Group’s remuneration policies, however no senior executive is directly involved in deciding their own remuneration.
The Remuneration Committee reviews and reassesses its charter annually, and recommends any changes it considers necessary to
the Board. The Remuneration Committee’s charter is available on the Company website.
The remuneration of non-executive directors is determined by the Board upon recommendation by the Remuneration Committee, within
the aggregate limits approved by shareholders. Non-executive directors are not entitled to participate in the Fleetwood Short or Long
Term Incentive Plans. The remuneration arrangements of executive directors, executives and key management personnel is
determined by the Remuneration Committee.
When considering remuneration arrangements for executives and key management personnel the Remuneration Committee seeks to
ensure that the remuneration arrangement motivate the recipient to pursue the short and long term performance objectives of the
Company. It does this by ensuring that there is a clear relationship between Company performance and remuneration by striking an
appropriate balance between fixed and variable (‘at risk’) remuneration.
The proportion of fixed and variable remuneration is based on available market data for comparable roles, the capacity of the individual
to influence the overall outcome of Company operations and return to shareholders. When considering the fixed component of
remuneration, the Remuneration Committee will take into account the person’s responsibilities, qualifications and experience. When
considering the variable component of remuneration, the Remuneration Committee considers the capacity of the individual to affect
profit earned by the Company and the individual’s performance against key responsibilities, key competencies and period specific
objectives. The variable remuneration includes short-term incentives in the form of cash payments and long-term incentives in the form
of shares, which are subject to performance hurdles and vesting provisions.
45
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Remuneration Report (continued)
Short Term Incentive Plan
Short-term incentives received by the Managing Director, executives and key management personnel are determined in accordance
with the provisions of the Fleetwood Short Term Incentive Plan (STIP). Fleetwood’s STIP was revised in the 2015 financial year such
that it only rewards exceptional performance. The STIP is designed to put a meaningful proportion of the participant’s remuneration at
risk, to be delivered upon the achievement of targets linked to the Company’s annual business objectives.
The STIP is linked to the Company’s annual business objectives through the incorporation of company specific qualifying gates. A
participant will only qualify for a STIP payment if the qualifying gates are satisfied. Qualifying gates are met if, the Company or
operating company the participant is employed by or manages (i) passes an independent internal safety audit, achieving at least at a
90% rating; and (ii) achieves at least 90% of budget Earnings Before Interest and Tax (EBIT) for the financial year. Once the gates
have been met a review of the performance measures is undertaken to determine if exceptional performance has been demonstrated.
The performance measures of the STIP comprise a combination of individual and company specific performance targets. The weighting
is 50% non-financial and 50% financial.
In setting the performance measures for the STIP, the Remuneration Committee is conscious
to ensure that all targets are measurable and provide a challenging but meaningful incentive to participants.
Non-financial metrics are based on performance against individual targets. Individual performance targets are derived from position
descriptions, key responsibilities, key competencies and period specific objectives which are in turn aligned with key business strategies
identified annually during the business planning process. Financial performance targets are derived from budgeted or forecast EBIT
above the qualifying gate which is considered an appropriate measure of the Company’s profitability.
Depending on the participant and their role within the Group, some targets may be restricted to the operating company in which the
participant is employed, or expanded to include the Group as a whole. Financial targets are expressed as a range over which
performance will be measured. The standard range is 90% to 125% of the applicable budget. The maximum amount a participant can
earn through the STIP is capped at a percentage of the participant’s Annual Fixed Remuneration (AFR). STIP percentage caps as
determined by the Remuneration Committee and as applicable to the Managing Director, executives and key management personnel
are noted below.
Maximum
STIP as % of
AFR
50%
40%
40%
40%
40%
40%
Brad Denison
Bradley van Hemert
Steve Carroll
Jarrod Waring
Giles Everest
Manuel Larre
In order for a payment under the STIP to be made, the qualifying gate must be satisfied and the participant must: meet the minimum
financial and non-financial performance measures, be an employee at the time the payment is to be made, and not have tendered their
resignation at the time the payment is made.
The Remuneration Committee is of the opinion that the STIP appropriately aligns executive remuneration with shareholder wealth
generation.
New Long Term Incentive Plan
Long-term incentives in the form of shares received by the Managing Director, executives and key management personnel are
determined in accordance with the provisions of the Executive Long Term Incentive plan (LTIP), which was approved by shareholders at
the 2014 annual general meeting The objective of this plan is to retain and reward the Managing Director, executives and key
management personnel and to align their long term interests with those of shareholders.
Under the plan, eligible directors, executives and key management personnel are invited to participate in a grant of shares or options
through a trust established for the LTIP. The Company provides participants with an interest free, non-recourse loan for an amount
equivalent to the price of the shares or options issued, for the sole purpose of acquiring units in the trust to which shares in the
Company are allocated. The loans are repayable upon the eventual sale or transfer of the shares from the trust to the participant. The
share units are restricted and subject to a risk of forfeiture until the end of the vesting period.
The number of shares granted is determined by the Board with reference to the participant’s performance over the immediately
preceding financial year, the Group’s financial performance and shareholder wealth generation. The price of the shares issued is
calculated using the Volume Weighted Average Price (VWAP) over the five days prior to the grant date.
The LTIP contains a gateway level of minimum performance below which no benefit accrues. The performance gateway is met where
the Company’s total shareholder return from grant to vesting date, equals or exceeds 15% p.a. and is equal to or greater than the ASX
All Ordinaries Index. The Remuneration Committee considers that the use of this index reduces sensitivity to the performance of a
particular competitor or the influence of cyclical industry specific factors.
Assuming the participant continues to be employed by Fleetwood and the performance hurdles are reached, one third of the securities
vest on each anniversary over 3 years following the grant date. Where the period of the participant’s employment is less than 1 year on
the grant date, the time based hurdles are extended by a further 1 year.
In the event that a performance hurdle is not reached, or the value of the shares is less than the outstanding balance of the loan, or the
participant ceases to be an employee for reasons other than death, illness and injury, the participant may surrender and forfeit the units
in the trust to the Company in full settlement of the loan balance. The share units expire 5 years from the date of issue. Until the
shares vest, voting and dividend rights remain with the trustee.
Up until the implementation of the LTIP, eligible directors, executives and key management persons participated in the Executive Option
Plan. The options granted pursuant to that plan are noted in this Report, and that plan will remain in effect until all granted options have
been exercised, fortified or have expired.
46
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Remuneration Report (continued)
Short Term Incentive Plan
Remuneration Report (continued)
Executive Option Plan
Short-term incentives received by the Managing Director, executives and key management personnel are determined in accordance
with the provisions of the Fleetwood Short Term Incentive Plan (STIP). Fleetwood’s STIP was revised in the 2015 financial year such
that it only rewards exceptional performance. The STIP is designed to put a meaningful proportion of the participant’s remuneration at
risk, to be delivered upon the achievement of targets linked to the Company’s annual business objectives.
The STIP is linked to the Company’s annual business objectives through the incorporation of company specific qualifying gates. A
participant will only qualify for a STIP payment if the qualifying gates are satisfied. Qualifying gates are met if, the Company or
operating company the participant is employed by or manages (i) passes an independent internal safety audit, achieving at least at a
90% rating; and (ii) achieves at least 90% of budget Earnings Before Interest and Tax (EBIT) for the financial year. Once the gates
have been met a review of the performance measures is undertaken to determine if exceptional performance has been demonstrated.
The performance measures of the STIP comprise a combination of individual and company specific performance targets. The weighting
is 50% non-financial and 50% financial.
In setting the performance measures for the STIP, the Remuneration Committee is conscious
to ensure that all targets are measurable and provide a challenging but meaningful incentive to participants.
Non-financial metrics are based on performance against individual targets. Individual performance targets are derived from position
descriptions, key responsibilities, key competencies and period specific objectives which are in turn aligned with key business strategies
identified annually during the business planning process. Financial performance targets are derived from budgeted or forecast EBIT
above the qualifying gate which is considered an appropriate measure of the Company’s profitability.
Depending on the participant and their role within the Group, some targets may be restricted to the operating company in which the
participant is employed, or expanded to include the Group as a whole. Financial targets are expressed as a range over which
performance will be measured. The standard range is 90% to 125% of the applicable budget. The maximum amount a participant can
earn through the STIP is capped at a percentage of the participant’s Annual Fixed Remuneration (AFR). STIP percentage caps as
determined by the Remuneration Committee and as applicable to the Managing Director, executives and key management personnel
Long-term incentives in the form of options received by eligible directors, senior executives and key management personnel were
determined in accordance with the provisions of the old Executive Option Plan. The objective of that plan was to retain and reward
eligible directors, executives and key management personnel and to align their long term interests with those of shareholders.
Invitation to participate in the plan was at the discretion of the Board, however participants generally needed to be employed in an
executive or key management position for a minimum period of two years before such invitation was extended.
Under the plan, participants were granted options to purchase ordinary shares in Fleetwood. The number of options granted was
determined by the Board with reference to the participant’s individual performance over the immediately preceding financial year, the
Group’s financial performance and shareholder wealth generation. No amounts were payable for the options, and each option entitles
the holder to subscribe for one share upon exercise. Assuming the participant continues to be employed by Fleetwood and the
performance hurdles are reached, for options issued after 1 July 2012 100% of the issued options vest on the third anniversary of the
grant date, and for options issued prior to 1 July 2012, one third of the options vest after 30 June subsequent to the date of issue, a
further one third of the options vest over each of the next 2 years. The exercise price of the options was calculated using the Volume
Weighted Average Price (VWAP) of the shares over the five days prior to the issue date. The maximum discount that could be applied
to the VWAP was 10%.
The options are only exercisable if the company’s total shareholder return equals or exceeds 15% p.a. compounded from the inception
of the plan and is equal to or greater than the ASX 300 All Industrials Accumulation Index.
In the event that a performance hurdle is not
reached, the options do not vest.
If the participant ceases to be an employee for reasons other than death, illness, injury, the attainment of the normal age of retirement
or for other reasons approved by the Board, the options lapse and terminate. The options expire 5 years from the date of issue. There
are no voting or dividend rights attaching to the options.
Movements in shareholder wealth for the five years to 30 June 2015:
Share price at start of year ($)
Share price at end of year ($)
Dividend per share (cents)
Earnings per share (cents)
Diluted earnings per share (cents)
$ Million
Revenue
Net profit before tax
Net profit after tax
2011
9.19
11.33
73.0
90.0
88.6
466.6
73.6
51.3
2012
11.33
11.74
76.0
90.4
89.2
332.9
75.6
53.2
2013
11.74
3.60
30.0
20.8
20.7
332.9
23.2
16.6
Remuneration of Directors and senior management
Short-term employee
benefits
Post
Share
Employment Other long
Based
Share
Based
Key management
personnel
Salary &
fees
$
Bonus
$
Non-
monetary
$
Superan-
nuation
$
Term Payment
Payment
Benefits Options Share units
$
$
$
2014
3.60
2.33
4.0
0.1
0.1
366.3
3.4
0.6
2015
2.33
1.37
-
0.3
0.3
302.0
0.9
0.2
Performance
based
Total
$
remuneration
%
Directors
Michael Hardy
2015
2014
Peter Gunzburg
2015
2014
Greg Tate
2015
2014
John Bond
2015
2014
Brad Denison
Managing Director
2015
2014
2015 Company and
2014 Consolidated
85,000
85,000
70,000
70,000
70,000
70,000
70,000
70,000
463,830
290,799
758,830
585,799
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
85,000
85,000
70,000
70,000
70,000
70,000
70,000
70,000
7,995
7,803
7,995
7,803
30,000
25,000
30,000
25,000
52,741
6,806
52,741
6,806
29,856
55,532
29,856
55,532
25,326
-
25,326
-
609,748
385,940
904,748
680,940
-
-
-
-
-
-
-
-
9.0
14.4
3.3
8.2
Brad Denison was appointed Managing Director on 1 August 2014. Prior to this, Mr Denison was employed as Chief Financial Officer
and Company Secretary.
47
are noted below.
Brad Denison
Bradley van Hemert
Steve Carroll
Jarrod Waring
Giles Everest
Manuel Larre
Maximum
STIP as % of
AFR
50%
40%
40%
40%
40%
40%
In order for a payment under the STIP to be made, the qualifying gate must be satisfied and the participant must: meet the minimum
financial and non-financial performance measures, be an employee at the time the payment is to be made, and not have tendered their
resignation at the time the payment is made.
The Remuneration Committee is of the opinion that the STIP appropriately aligns executive remuneration with shareholder wealth
generation.
New Long Term Incentive Plan
Long-term incentives in the form of shares received by the Managing Director, executives and key management personnel are
determined in accordance with the provisions of the Executive Long Term Incentive plan (LTIP), which was approved by shareholders at
the 2014 annual general meeting The objective of this plan is to retain and reward the Managing Director, executives and key
management personnel and to align their long term interests with those of shareholders.
Under the plan, eligible directors, executives and key management personnel are invited to participate in a grant of shares or options
through a trust established for the LTIP. The Company provides participants with an interest free, non-recourse loan for an amount
equivalent to the price of the shares or options issued, for the sole purpose of acquiring units in the trust to which shares in the
Company are allocated. The loans are repayable upon the eventual sale or transfer of the shares from the trust to the participant. The
share units are restricted and subject to a risk of forfeiture until the end of the vesting period.
The number of shares granted is determined by the Board with reference to the participant’s performance over the immediately
preceding financial year, the Group’s financial performance and shareholder wealth generation. The price of the shares issued is
calculated using the Volume Weighted Average Price (VWAP) over the five days prior to the grant date.
The LTIP contains a gateway level of minimum performance below which no benefit accrues. The performance gateway is met where
the Company’s total shareholder return from grant to vesting date, equals or exceeds 15% p.a. and is equal to or greater than the ASX
All Ordinaries Index. The Remuneration Committee considers that the use of this index reduces sensitivity to the performance of a
particular competitor or the influence of cyclical industry specific factors.
Assuming the participant continues to be employed by Fleetwood and the performance hurdles are reached, one third of the securities
vest on each anniversary over 3 years following the grant date. Where the period of the participant’s employment is less than 1 year on
the grant date, the time based hurdles are extended by a further 1 year.
In the event that a performance hurdle is not reached, or the value of the shares is less than the outstanding balance of the loan, or the
participant ceases to be an employee for reasons other than death, illness and injury, the participant may surrender and forfeit the units
in the trust to the Company in full settlement of the loan balance. The share units expire 5 years from the date of issue. Until the
shares vest, voting and dividend rights remain with the trustee.
Up until the implementation of the LTIP, eligible directors, executives and key management persons participated in the Executive Option
Plan. The options granted pursuant to that plan are noted in this Report, and that plan will remain in effect until all granted options have
been exercised, fortified or have expired.
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Remuneration Report (continued)
Short-term employee
benefits
Post
Share
Employment Other long
Based
Share
Based
Key management
personnel
Salary &
fees
$
Bonus
$
Non-
monetary
$
Superan-
nuation
$
Term Payment
Payment
Benefits Options Share units
$
$
$
Performance
based
Total
$
remuneration
%
Executives
Stephen Price
CEO, Fleetwood Corporation
(Resigned 27/06/14)
2014
Bradley Van Hemert
GM, International Procurement
2015
2014
Ben Rosser
CEO, Fleetwood Pty Ltd
(Resigned 28/11/14)
2015
2014
Steve Carroll
GM, International Business
2015
2014
David Martin
CEO, BRB Modular Pty Ltd
(Resigned 26/12/13)
2014
Giles Everest
Executive GM, Fleetwood Pty Ltd
(Appointed 01/12/14)
2015
618,253
306,200
305,431
150,660
267,130
237,407
212,748
147,788
-
-
-
-
-
-
-
-
-
-
-
25,000
-
(30,983)
-
612,270
(5.1)
28,570
25,000
7,926
4,932
23,885
46,358
4,469
-
371,050
381,721
7.6
12.1
275
5,725
11,908
24,710
(9,514)
3,676
(30,625)
53,418
-
-
122,704
354,659
(25.0)
15.1
10,749
23,878
22,855
22,460
9,468
8,263
14,928
28,275
4,469
-
299,876
295,624
6.5
9.6
-
8,577
-
(2,838)
-
153,527
(1.8)
152,208
-
15,000
13,535
605
-
2,980
184,328
1.6
Jarrod Waring
(Appointed 01/09/14)
Executive GM, BRB Modular Pty Ltd
2015
246,216
Manuel Larre
Executive GM, Camec & Flexiglass
2015
2014
208,349
215,822
Yanya O'Hara
(Appointed 01/08/14)
Company Secretary
2015
2015 Company and
2014 Consolidated
9,000
-
-
-
-
-
-
-
18,806
4,589
52
4,469
283,132
20,659
20,717
3,892
1,638
11,176
16,935
4,469
-
248,545
255,112
14,373
4,264
144
2,235
180,197
159,181
1,460,221
1,767,172
9,000
-
26,024
29,603
130,706
126,464
21,230
18,509
19,560
111,165
23,091 1,689,832
- 2,052,913
4.8
6.3
6.6
1.3
3.1
5.4
Included in salary & fees are amounts of annual leave accrued during the reporting period. There are no post-employment benefits
other than superannuation. Executive contracts do not provide for any termination payments, other than the payment of accrued leave
entitlements. Other long term benefits comprise long service leave entitlements accrued to the executive during the reporting period.
The amount included in remuneration as share-based payments are not related to or indicative of the benefits (if any) that individual
executives may ultimately realise should the equity instruments vest.
Bradley Van Hemert was appointed GM, International Procurement on 28 June 2015. Prior to this, Mr. Van Hemert was employed as
CEO, Fleetwood Recreational Vehicles Pty Ltd.
Steve Carroll was appointed GM, International Business on 17 August 2015. Prior to this, Mr. Carroll was employed as CEO, Camec
Pty Ltd.
Manuel Larre was appointed Executive GM, Camec & Flexiglass on 17 August 2015. Prior to this, Mr. Larre was employed as GM,
Flexiglass
Yanya O’Hara was appointed Company Secretary on 1 August 2014. Prior to this, Mrs. O’Hara was employed as Assistant Company
Secretary.
48
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Remuneration Report (continued)
Short-term employee
Post
Share
benefits
Employment Other long
Based
Share
Based
Key management
personnel
Salary &
Non-
fees
Bonus
monetary
$
$
$
Superan-
nuation
$
Term Payment
Payment
Benefits Options Share units
Total
remuneration
$
$
$
$
%
Performance
based
Executives
Stephen Price
CEO, Fleetwood Corporation
(Resigned 27/06/14)
Bradley Van Hemert
GM, International Procurement
Ben Rosser
CEO, Fleetwood Pty Ltd
(Resigned 28/11/14)
Steve Carroll
GM, International Business
2014
2015
2014
2015
2014
2015
2014
618,253
306,200
305,431
150,660
267,130
237,407
212,748
David Martin
CEO, BRB Modular Pty Ltd
(Resigned 26/12/13)
2014
Giles Everest
Executive GM, Fleetwood Pty Ltd
(Appointed 01/12/14)
2015
Jarrod Waring
(Appointed 01/09/14)
Executive GM, BRB Modular Pty Ltd
Manuel Larre
Executive GM, Camec & Flexiglass
2015
2015
2014
Yanya O'Hara
(Appointed 01/08/14)
Company Secretary
2015
2015 Company and
2014 Consolidated
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
25,000
-
(30,983)
-
612,270
(5.1)
28,570
25,000
7,926
4,932
23,885
46,358
4,469
-
371,050
381,721
7.6
12.1
275
5,725
11,908
24,710
(9,514)
(30,625)
3,676
53,418
-
-
122,704
354,659
(25.0)
15.1
10,749
23,878
22,855
22,460
9,468
8,263
14,928
28,275
4,469
-
299,876
295,624
6.5
9.6
147,788
-
8,577
-
(2,838)
-
153,527
(1.8)
152,208
-
15,000
13,535
605
-
2,980
184,328
1.6
246,216
9,000
18,806
4,589
52
4,469
283,132
208,349
215,822
20,659
20,717
3,892
1,638
11,176
16,935
4,469
-
248,545
255,112
159,181
14,373
4,264
144
2,235
180,197
1,460,221
9,000
1,767,172
26,024
29,603
130,706
126,464
21,230
19,560
23,091 1,689,832
18,509
111,165
- 2,052,913
4.8
6.3
6.6
1.3
3.1
5.4
Included in salary & fees are amounts of annual leave accrued during the reporting period. There are no post-employment benefits
other than superannuation. Executive contracts do not provide for any termination payments, other than the payment of accrued leave
entitlements. Other long term benefits comprise long service leave entitlements accrued to the executive during the reporting period.
The amount included in remuneration as share-based payments are not related to or indicative of the benefits (if any) that individual
executives may ultimately realise should the equity instruments vest.
Bradley Van Hemert was appointed GM, International Procurement on 28 June 2015. Prior to this, Mr. Van Hemert was employed as
CEO, Fleetwood Recreational Vehicles Pty Ltd.
Steve Carroll was appointed GM, International Business on 17 August 2015. Prior to this, Mr. Carroll was employed as CEO, Camec
Manuel Larre was appointed Executive GM, Camec & Flexiglass on 17 August 2015. Prior to this, Mr. Larre was employed as GM,
Pty Ltd.
Flexiglass
Secretary.
Remuneration Report (continued)
Share based payment arrangements in existence at the reporting date: Options
Exercise
price
$
Options at
beginning of
year
No.
Options
granted
No.
Options
expired /
forfeited
No.
Options
exercised
(shares
issued)
No.
Options
at end of
year
No.
Vested
at end of
year
No.
Proceeds
received on
exercise
$
Fair value
(market value)
of shares on
exercise
$
7.25
6.00
8.02
8.68
9.39
10.57
2.56
2.88
31,122
-
(31,122)
16,000
16,000
101,666
135,000
131,337
206,337
220
220
190,000
325,000
-
-
-
-
-
-
-
-
-
-
(16,000)
-
(20,000)
(33,334)
(34,562)
(75,000)
-
-
(60,000)
(135,000)
750
-
-
750
-
-
350,000
-
-
580,000
(80,000)
(230,000)
789,003
713,679
-
(210,562)
580,750
(504,456)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
16,000
-
16,000
81,666
101,666
81,666
101,666
96,775
131,337
96,775
87,558
220
220
130,000
190,000
750
750
270,000
350,000
147
73
-
-
250
-
-
-
579,411
789,973
178,838
205,297
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Issue
date
14/11/08
2014
31/10/09
2015
2014
31/10/10
2015
2014
02/09/11
2015
2014
30/08/12
2015
2014
20/02/13
2015
2014
30/08/13
2015
2014
30/08/13
2015
2014
2015
2014
Weighted average
price ($)
2015
2014
Options information:
6.43
9.27
N/A
2.88
6.75
6.41
N/A
N/A
6.30
6.53
8.37
8.14
Option
life
Issue Date Expiry Date Years
Volatility
%
Dividend
yield
%
Risk free
interest
rate
%
Fair value
at grant
date
$
Exercise
price
$
Share
price at
grant date
$
Weighted
average share
price at
exercise date
2015
$
Weighted
average share
price at
exercise date
2014
$
31/10/09
31/10/10
02/09/11
29/08/12
20/02/13
30/08/13
30/08/13
30/10/14
30/10/15
01/09/16
28/08/17
19/02/18
30/08/18
30/08/18
5
5
5
5
5
5
5
50.00
40.00
35.69
35.80
35.39
45.03
45.03
8.54
6.14
6.18
7.59
7.59
3.64
3.64
4.53
4.50
4.50
2.77
2.85
2.54
3.68
2.09
2.43
2.53
2.31
1.15
0.90
1.40
6.00
8.02
8.68
9.39
10.57
2.56
2.88
7.57
10.02
10.66
11.78
9.66
3.10
3.10
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Yanya O’Hara was appointed Company Secretary on 1 August 2014. Prior to this, Mrs. O’Hara was employed as Assistant Company
Refer to summary on following pages for those options which are vested and exercisable, and vested and unexercisable.
Yanya O’Hara was issued options under the Employee Option Plan in 2013 and 2014. Jarrod Waring was issued options under the
Employee Option Plan in 2014.
49
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Remuneration Report (continued)
Share based payment arrangements in existence at the reporting date: Share units
Exercise
price
$
Units at
beginning of
year
No.
Units
granted
No.
Units
expired /
forfeited
No.
Units
exercised
(shares
issued)
No.
Units at
end of year
No.
Units at
end of year
No.
Proceeds
received on
exercise
$
Fair value
(market value)
of shares on
exercise
$
-
-
325,000
325,000
-
-
-
-
325,000
325,000
-
-
-
-
-
-
Issue
date
18/12/14
2015
2015
Share units information:
Unit
life
Issue Date Expiry Date Years
12/12/14
12/12/19
5
Volatility
%
37.18
Dividend
yield
%
3.20
Risk free
interest
rate
%
2.40
Fair value
at grant
date
$
0.41
Exercise
price
$
1.35
Share
price at
grant date
$
1.35
Weighted
average share
price at
exercise date
2015
$
-
Weighted
average share
price at
exercise date
2014
$
-
Shares, options and share units held by Directors, executives and key management personnel and movements during the reporting
period;
Shares
Directors
Michael Hardy
2015
2014
Greg Tate
2015
2014
John Bond
2015
2014
Brad Denison
2015
2014
Executives
Bradley Van Hemert
2015
2014
Stephen Price
(Resigned 27/06/14)
2014
Ben Rosser
(Resigned 28/11/14)
2015
2014
Jarrod Waring
2015
2014
2015
2014
Shares at
beginning of year
No.
Options
exercised
No.
Net other
change
No.
Shares at
end of year
No.
16,975
1,975
6,581,271
6,569,427
20,000
-
45,464
25,464
175,448
175,334
16,666
10,000
10,000
2,804
1,844
6,841,962
6,800,710
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
15,000
16,975
16,975
-
11,844
6,581,271
6,581,271
-
20,000
-
20,000
20,000
20,000
45,464
45,464
362
114
175,810
175,448
-
16,666
(4,000)
-
5,700
960
6,062
67,918
6,000
10,000
8,504
2,804
6,848,024
6,868,628
Peter Gunzburg, Steve Carroll, Giles Everest, Manuel Larre and Yanya O’Hara did not hold any shares during FY2014 or FY2015.
50
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Remuneration Report (continued)
Share based payment arrangements in existence at the reporting date: Share units
Remuneration Report (continued)
Options
Units at
year
No.
Units
exercised
Units
(shares
issued)
No.
Units
granted
No.
expired /
forfeited
No.
Exercise
beginning of
price
$
Fair value
Proceeds
(market value)
Units at
Units at
received on
of shares on
end of year
end of year
exercise
exercise
No.
No.
-
-
325,000
325,000
-
-
-
-
325,000
325,000
Share units information:
Weighted
Weighted
average share
average share
Issue Date Expiry Date Years
12/12/14
12/12/19
5
37.18
Unit
life
Volatility
%
Risk free
Fair value
Share
price at
price at
Dividend
interest
at grant
Exercise
price at
exercise date
exercise date
yield
%
3.20
rate
%
2.40
date
$
0.41
price
grant date
2015
2014
$
1.35
$
1.35
$
-
Shares, options and share units held by Directors, executives and key management personnel and movements during the reporting
Shares at
beginning of year
Options
exercised
No.
Net other
Shares at
change
end of year
No.
No.
$
-
-
$
-
$
-
-
-
-
-
-
-
-
15,000
16,975
16,975
11,844
6,581,271
6,581,271
20,000
20,000
20,000
20,000
45,464
45,464
362
114
175,810
175,448
16,666
6,000
10,000
8,504
2,804
6,848,024
6,868,628
(4,000)
5,700
960
6,062
67,918
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
No.
16,975
1,975
6,581,271
6,569,427
20,000
-
45,464
25,464
175,448
175,334
16,666
10,000
10,000
2,804
1,844
6,841,962
6,800,710
Issue
date
18/12/14
2015
2015
period;
Shares
Directors
Michael Hardy
Greg Tate
John Bond
Brad Denison
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2014
2015
2014
2015
2014
2015
2014
Executives
Bradley Van Hemert
Stephen Price
(Resigned 27/06/14)
Ben Rosser
(Resigned 28/11/14)
Jarrod Waring
Peter Gunzburg, Steve Carroll, Giles Everest, Manuel Larre and Yanya O’Hara did not hold any shares during FY2014 or FY2015.
Options at
beginning
of year
No.
Granted
No.
Forfeited Exercised
No.
No.
Vested
during the
year
No.
Vested
and exer-
cisable at
end of year
No.
Vested
and unexer-
cisable at
end of year
No.
Proceeds
received on
exercise
$
Options at
end of year
No.
231,837
131,837
-
100,000
(16,000)
-
108,433
58,433
-
50,000
-
-
199,171
150,293
-
80,000
-
(31,122)
218,334
150,000
(368,334)
114,562
114,562
-
80,000
(114,562)
-
25,000
80,000
(105,000)
250
-
-
250
55,000
15,000
-
40,000
720
220
-
500
-
-
-
-
-
-
709,973
713,459
-
580,000
(130,562)
(504,456)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
215,837
231,837
13,057
26,390
108,433
108,433
199,171
199,171
6,144
11,144
13,057
26,390
-
41,667
-
114,562
11,521
21,520
-
250
250
55,000
55,000
720
720
-
83
-
-
-
240
73
579,411
709,003
44,102
127,111
-
-
-
-
-
-
-
-
-
-
83
-
-
-
313
73
396
-
65,836
68,779
33,432
27,288
79,170
66,113
-
-
43,040
-
-
-
-
-
-
-
178,438
205,220
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Directors
Brad Denison
2015
2014
Executives
Steve Carroll
2015
2014
Bradley Van Hemert
2015
2014
Stephen Price
(Resigned 27/06/14)
2014
Ben Rosser
(Resigned 28/11/14)
2015
2014
David Martin
(Resigned 26/12/13)
2014
Jarrod Waring
2015
2014
Manuel Larre
2015
2014
Yanya O'Hara
2015
2014
2015
2014
Giles Everest did not hold any options during the reporting period.
51
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Remuneration Report (continued)
Option values that form part of current year remuneration;
Year Options Granted
2013
$
2014
$
2012
$
Total
$
Remuneration
as options
%
Directors
Brad Denison
2015
2014
Executives
Bradley Van Hemert
2015
2014
Ben Rosser
(Resigned 28/11/14)
2015
2014
Steve Carroll
2015
2014
Jarrod Waring
2015
2014
Manuel Larre
2015
2014
Yanya O'Hara
2015
2014
2015
2014
Movements in option entitlements during the year:
-
9,659
-
9,659
-
8,523
-
4,545
-
-
-
-
-
-
-
32,386
7,667
20,493
6,133
16,394
(11,829)
24,591
3,833
10,246
-
-
2,300
6,148
40
82
19,973
71,807
Options granted
No. at
grant
date
Value at
grant
date
$
Options exercised
(shares issued)
Value at
exercise
date
$
No.
during
year
Amounts
paid
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Key management
personnel
Brad Denison
Bradley Van Hemert
Ben Rosser
Steve Carroll
Jarrod Waring
Manuel Larre
Yanya O'Hara
22,190
25,380
17,752
46,358
(18,796)
53,418
11,095
28,275
52
89
8,876
10,787
104
179
60,069
153,699
Options
Vested
No.
during
year
13,057
13,057
11,521
6,144
83
-
240
29,856
55,532
23,885
72,411
(30,625)
86,532
14,928
43,067
52
89
11,176
16,935
144
261
80,042
257,892
5.4%
14.7%
6.6%
19.7%
-23.2%
24.7%
5.1%
15.2%
0.0%
0.0%
4.6%
6.7%
0.1%
0.2%
3.9%
12.7%
Value
of options
included in
remuneration Remuneration
by options
%
for the year
$
29,856
23,885
(30,625)
14,928
52
11,176
104
5.4
6.6
(23.2)
5.1
0.0
4.6
0.1
16,000 options lapsed during the year. No options were forfeited during the year because the person did not meet service or
performance criteria.
Due to the limited financial products available to facilitate hedging of unvested or vested options the Board does not impose any
restrictions in relation to a person limiting his or her exposure to the risk in respect of options issued by the Company. No Director is a
party to a contract whereby such person would have a right to call for or deliver shares in, or debentures of or interests in a registered
scheme made available by the Group.
52
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Remuneration Report (continued)
Option values that form part of current year remuneration;
Year Options Granted
Total
$
Remuneration
as options
%
2012
9,659
-
9,659
8,523
4,545
$
-
-
-
-
-
-
-
-
-
-
32,386
2013
$
7,667
20,493
6,133
16,394
(11,829)
24,591
3,833
10,246
-
-
2,300
6,148
40
82
19,973
71,807
2014
$
22,190
25,380
17,752
46,358
(18,796)
53,418
11,095
28,275
52
89
8,876
10,787
104
179
60,069
153,699
29,856
55,532
23,885
72,411
(30,625)
86,532
14,928
43,067
52
89
11,176
16,935
144
261
80,042
257,892
5.4%
14.7%
6.6%
19.7%
-23.2%
24.7%
5.1%
15.2%
0.0%
0.0%
4.6%
6.7%
0.1%
0.2%
3.9%
12.7%
Directors
Brad Denison
Executives
Bradley Van Hemert
Ben Rosser
(Resigned 28/11/14)
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
Steve Carroll
Jarrod Waring
Manuel Larre
Yanya O'Hara
Key management
personnel
Brad Denison
Bradley Van Hemert
Ben Rosser
Steve Carroll
Jarrod Waring
Manuel Larre
Yanya O'Hara
performance criteria.
Remuneration Report (continued)
Share units
Share units
Directors
Brad Denison
2015
Executives
Steve Carroll
2015
Bradley Van Hemert
2015
Giles Everest
(Appointed 1/12/14)
2015
Jarrod Waring
2015
Manuel Larre
2015
Yanya O'Hara
2015
2015
Units at
beginning
of year
No.
Granted
No.
Forfeited
No.
Exercised
No.
Units at end
of year
No.
Vested
during the
year
No.
Vested at
end of year
No.
Proceeds
received on
exercise
$
-
170,000
-
-
-
-
-
-
-
30,000
30,000
20,000
30,000
30,000
15,000
325,000
-
-
-
-
-
-
-
-
-
170,000
-
-
-
-
-
-
-
30,000
30,000
20,000
30,000
30,000
15,000
325,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Share units values that form part of current year remuneration;
Movements in option entitlements during the year:
Options granted
No. at
grant
date
Options exercised
(shares issued)
Value at
No.
Value at
Options
Vested
No.
Value
of options
included in
grant
date
during
exercise
Amounts
during
remuneration Remuneration
year
date
paid
year
for the year
by options
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
$
-
-
-
-
-
-
-
13,057
13,057
11,521
6,144
83
-
240
$
29,856
23,885
(30,625)
14,928
52
11,176
104
(23.2)
%
5.4
6.6
5.1
0.0
4.6
0.1
16,000 options lapsed during the year. No options were forfeited during the year because the person did not meet service or
Due to the limited financial products available to facilitate hedging of unvested or vested options the Board does not impose any
restrictions in relation to a person limiting his or her exposure to the risk in respect of options issued by the Company. No Director is a
party to a contract whereby such person would have a right to call for or deliver shares in, or debentures of or interests in a registered
scheme made available by the Group.
Directors
Brad Denison
2015
Executives
Bradley Van Hemert
2015
Steve Carroll
2015
Giles Everest
2015
Jarrod Waring
2015
Manuel Larre
2015
Yanya O'Hara
2015
2015
Year Share units
granted
2015
$
Remuneration
as share units
%
25,326
4.5%
4,469
4,469
2,980
4,469
4,469
2,235
48,417
1.2%
1.5%
1.6%
1.6%
1.8%
1.3%
2.3%
53
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Remuneration Report (continued)
Movements in share unit entitlements during the year:
Key management
Share units granted
No. at
grant
Value at
grant
Share units exercised
(shares issued)
Value at
exercise
No.
during
Amounts
Units
Vested
No.
during
Value
of share units
included in
remuneration Remuneration
personnel
date
date
year
date
paid
year
for the year by share units
Brad Denison
Bradley Van Hemert
Steve Carroll
Jarrod Waring
Manuel Larre
Yanya O'Hara
170,000
30,000
30,000
30,000
30,000
15,000
$
70,040
12,360
12,360
12,360
12,360
6,180
-
-
-
-
-
-
$
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
-
-
-
$
25,326
4,469
4,469
4,469
4,469
2,235
%
4.5
1.2
1.5
1.6
1.8
1.3
The issue date for shares granted pursuant to the LTIP was 18 December 2014 at a price of $1.35 per share. Under the LTIP, each unit
can be redeemed for one underlying share in the Company upon repayment of the loan. There have been no alterations to the terms
and conditions of this grant since the grant date.
Loans to key management personnel in connection with the Long Term Incentive Plan totaling $438,750 (2014: nil) were outstanding at
the end of the reporting period. As the loans are non-recourse there is no fixed term, and no allowance for doubtful debts or impairment
loss has been recognised against them. The number of key management personnel included in the aggregate of loans is 7.
Mr. Denison had loans totaling $229,500 (2014: nil) made to him during the reporting period, with the total loan remaining outstanding at
the end of the reporting period in connection with the Long Term Incentive Plan. As the loan is non-recourse there is no fixed term, and
no allowance for doubtful debts or impairment loss has been recognised against it. There were no other individuals with loans above
$100,000 during the reporting period.
No share units issued during the year vested or lapsed during the year. No bonuses or share units were forfeited during the year
because the person did not meet service or performance criteria.
The terms and conditions of employment of senior executives and key management personnel are governed by individual employment
contracts. Employment contracts are not limited in duration and do not contain termination payments. Each employment contract may
be terminated by either party upon the giving of 4 weeks’ notice. However, the Company may terminate an employment contract at any
time and without notice if serious misconduct has occurred.
Non-audit Services
The Directors are satisfied that the provision of non-audit services during the year by the auditor is compatible with the general standard
of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services
by the auditors did not compromise the auditor independence requirement of the Corporations Act 2001 for the following reasons:
all non-audit services have been reviewed by the Audit Committee to ensure that they do not impact impartiality and
objectivity of the auditor; and
none of the services undermine the general principle relating to auditor independence as set out in the Corporations Act 2001
or the Code of Conduct APES 110 Code of Ethics for Professional Accountants, as amended, issued by the Accounting
Professional and Ethical Standards board, including reviewing or auditing the auditors own work, acting in a management or a
decision making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks and
rewards.
Details of the amounts paid or payable to the auditor for non-audit services provided during the year by the auditor are outlined in note
26 to the financial statements.
Company Secretary
Yanya O’Hara is the Company Secretary. Prior to her appointment, Yanya was employed by the Company for three years as Assistant
Company Secretary. Prior to joining Fleetwood, Yanya practiced as a corporate attorney in New York and as a barrister and solicitor in
Perth.
54
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Remuneration Report (continued)
Movements in share unit entitlements during the year:
Share units exercised
Share units granted
(shares issued)
Value at
No.
Value at
No. at
grant
Units
Value
Vested
of share units
No.
included in
Key management
grant
during
exercise
Amounts
during
remuneration Remuneration
Corporate Governance Statement
The Company’s Corporate Governance Statement for the year ended 30 June 2015, may be accessed from the Company’s website at
http://www.fleetwoodcorporation.com.au/Investors/Corporate-Governance.
Rounding
The Company is of a kind referred to in ASIC Class Order 98/0100 dated 10 July 1998 and accordingly amounts in the financial report
and directors’ report have been rounded to the nearest one thousand dollars, unless otherwise indicated.
personnel
date
date
year
date
paid
year
for the year by share units
Signed in accordance with a resolution of the Directors.
M Hardy
Chairman
30 September 2015
Brad Denison
Bradley Van Hemert
Steve Carroll
Jarrod Waring
Manuel Larre
Yanya O'Hara
170,000
30,000
30,000
30,000
30,000
15,000
$
70,040
12,360
12,360
12,360
12,360
6,180
-
-
-
-
-
-
$
-
-
-
-
-
-
$
-
-
-
-
-
-
-
-
-
-
-
-
$
25,326
4,469
4,469
4,469
4,469
2,235
%
4.5
1.2
1.5
1.6
1.8
1.3
The issue date for shares granted pursuant to the LTIP was 18 December 2014 at a price of $1.35 per share. Under the LTIP, each unit
can be redeemed for one underlying share in the Company upon repayment of the loan. There have been no alterations to the terms
and conditions of this grant since the grant date.
Loans to key management personnel in connection with the Long Term Incentive Plan totaling $438,750 (2014: nil) were outstanding at
the end of the reporting period. As the loans are non-recourse there is no fixed term, and no allowance for doubtful debts or impairment
loss has been recognised against them. The number of key management personnel included in the aggregate of loans is 7.
Mr. Denison had loans totaling $229,500 (2014: nil) made to him during the reporting period, with the total loan remaining outstanding at
the end of the reporting period in connection with the Long Term Incentive Plan. As the loan is non-recourse there is no fixed term, and
no allowance for doubtful debts or impairment loss has been recognised against it. There were no other individuals with loans above
$100,000 during the reporting period.
No share units issued during the year vested or lapsed during the year. No bonuses or share units were forfeited during the year
because the person did not meet service or performance criteria.
The terms and conditions of employment of senior executives and key management personnel are governed by individual employment
contracts. Employment contracts are not limited in duration and do not contain termination payments. Each employment contract may
be terminated by either party upon the giving of 4 weeks’ notice. However, the Company may terminate an employment contract at any
time and without notice if serious misconduct has occurred.
Non-audit Services
The Directors are satisfied that the provision of non-audit services during the year by the auditor is compatible with the general standard
of independence for auditors imposed by the Corporations Act 2001. The Directors are satisfied that the provision of non-audit services
by the auditors did not compromise the auditor independence requirement of the Corporations Act 2001 for the following reasons:
all non-audit services have been reviewed by the Audit Committee to ensure that they do not impact impartiality and
objectivity of the auditor; and
none of the services undermine the general principle relating to auditor independence as set out in the Corporations Act 2001
or the Code of Conduct APES 110 Code of Ethics for Professional Accountants, as amended, issued by the Accounting
Professional and Ethical Standards board, including reviewing or auditing the auditors own work, acting in a management or a
decision making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks and
Details of the amounts paid or payable to the auditor for non-audit services provided during the year by the auditor are outlined in note
Yanya O’Hara is the Company Secretary. Prior to her appointment, Yanya was employed by the Company for three years as Assistant
Company Secretary. Prior to joining Fleetwood, Yanya practiced as a corporate attorney in New York and as a barrister and solicitor in
rewards.
26 to the financial statements.
Company Secretary
Perth.
55
FLEETWOOD CORPORATIONANNUAL REPORT 2015 Directors’ Declaration
In the opinion of the directors of Fleetwood Corporation Limited:
a)
The financial statements and notes set out on pages 8 to 43, are in accordance with the Corporations Act 2001 (Cth),
including:
i.
Complying with Australian Accounting Standards and the Corporations Regulations 2001 (Cth); and
ii. Giving a true and fair view of the Group’s financial position as at 30 June 2015 and of its performance for the financial
year ended on that date; and
b)
c)
There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and
payable; and
There are reasonable grounds to believe that the Company and the companies to which the ASIC Class Order 98/1418
applies, as detailed in note 27 to the financial statements will, as a Group, be able to meet any obligations or liabilities to
which they are, or may become, subject by virtue of the deed of cross guarantee.
The Directors’ draw attention to note 1 to the financial statements, which includes a statement of compliance with International Financial
Reporting Standards.
The directors have been given the declarations required by s.295A of the Corporations Act 2001 (Cth) from the Managing Director.
Signed in accordance with a resolution of the directors.
On behalf of the Directors
M Hardy
Chairman
30 September 2015
Perth
56
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
a)
The financial statements and notes set out on pages 8 to 43, are in accordance with the Corporations Act 2001 (Cth),
Directors’ Declaration
In the opinion of the directors of Fleetwood Corporation Limited:
i.
Complying with Australian Accounting Standards and the Corporations Regulations 2001 (Cth); and
ii. Giving a true and fair view of the Group’s financial position as at 30 June 2015 and of its performance for the financial
year ended on that date; and
b)
There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and
including:
payable; and
c)
There are reasonable grounds to believe that the Company and the companies to which the ASIC Class Order 98/1418
applies, as detailed in note 27 to the financial statements will, as a Group, be able to meet any obligations or liabilities to
which they are, or may become, subject by virtue of the deed of cross guarantee.
The Directors’ draw attention to note 1 to the financial statements, which includes a statement of compliance with International Financial
Reporting Standards.
The directors have been given the declarations required by s.295A of the Corporations Act 2001 (Cth) from the Managing Director.
Signed in accordance with a resolution of the directors.
On behalf of the Directors
M Hardy
Chairman
30 September 2015
Perth
57
57
FLEETWOOD CORPORATIONANNUAL REPORT 2015
58
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
58
58
59
FLEETWOOD CORPORATIONANNUAL REPORT 2015 ASX Additional Information
as at 22 September 2015
Additional information required by the Australian Securities Exchange Limited Listing Rules and not disclosed elsewhere in this report is
set out below.
Twenty largest shareholders
Name
National Nominees Limited
Karrad Pty Ltd
HSBC Custody Nominees (Australia) Limited
Citicorp Nominees Pty Limited
J P Morgan Nominees Australia Limited
HSBC Custody Nominees (Australia) Limited - GSCO ECA
Adventure Holdings Pty Ltd
Jarli Pty Ltd
Creative Living (Qld) Pty Ltd
Trinity Management Pty Ltd
Mr Greg Tate
Mr John Ian Amos + Mrs Cintra Gail Amos
ABN Amro Clearing Sydney Nominees Pty Ltd
BNP Paribas Noms Pty Ltd
Nulis Nominees (Australia) Limited
Sporran Lean Pty Ltd
Tideways Classic Pty Ltd
Hallam Drainage Pty Ltd
Leopard Capital Pty Ltd
One Managed Invt Funds Ltd
Substantial shareholders
The number of shares held by substantial shareholders are set out below:
Name
National Nominees Limited
Greg Tate
HSBC Custody Nominees (Australia) Limited
Citicorp Nominees Pty Limited
J P Morgan Nominees Australia Limited
Distribution of equity security holders
Category
1 -1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Shareholders holding less than a marketable parcel
Number
of ordinary
shares held
6,939,356
5,211,823
4,744,406
3,212,277
2,513,400
1,346,868
890,315
800,000
420,000
360,000
338,873
309,143
306,473
277,767
233,571
212,000
191,860
190,875
183,304
175,430
28,857,741
6,940,156
6,581,271
6,124,400
3,213,945
2,513,400
%
11.37%
8.54%
7.77%
5.26%
4.12%
2.21%
1.46%
1.31%
0.69%
0.59%
0.56%
0.51%
0.50%
0.46%
0.38%
0.35%
0.31%
0.31%
0.30%
0.29%
47.28%
11.37%
10.78%
10.03%
5.27%
4.12%
Number of
shareholders
3,344
3,907
839
565
31
8,686
984
Voting rights of shareholders
On a show of hands, every member in person or by proxy shall have one vote. Upon a poll, voting rights of such members shall be
one vote for each share held.
On market buy-back
There is no current on market buy-back.
Other information
Fleetwood Corporation Limited, incorporated and domiciled in Australia, is a publicly listed company limited by shares.
60
FLEETWOOD CORPORATION
ANNUAL REPORT 2015
Additional information required by the Australian Securities Exchange Limited Listing Rules and not disclosed elsewhere in this report is
ASX Additional Information
as at 22 September 2015
set out below.
Twenty largest shareholders
Name
National Nominees Limited
Karrad Pty Ltd
HSBC Custody Nominees (Australia) Limited
Citicorp Nominees Pty Limited
J P Morgan Nominees Australia Limited
HSBC Custody Nominees (Australia) Limited - GSCO ECA
Adventure Holdings Pty Ltd
Jarli Pty Ltd
Creative Living (Qld) Pty Ltd
Trinity Management Pty Ltd
Mr Greg Tate
Mr John Ian Amos + Mrs Cintra Gail Amos
ABN Amro Clearing Sydney Nominees Pty Ltd
BNP Paribas Noms Pty Ltd
Nulis Nominees (Australia) Limited
Sporran Lean Pty Ltd
Tideways Classic Pty Ltd
Hallam Drainage Pty Ltd
Leopard Capital Pty Ltd
One Managed Invt Funds Ltd
Substantial shareholders
The number of shares held by substantial shareholders are set out below:
Name
National Nominees Limited
Greg Tate
HSBC Custody Nominees (Australia) Limited
Citicorp Nominees Pty Limited
J P Morgan Nominees Australia Limited
Distribution of equity security holders
Category
1 -1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Shareholders holding less than a marketable parcel
Voting rights of shareholders
one vote for each share held.
On market buy-back
There is no current on market buy-back.
Other information
Number
of ordinary
shares held
6,939,356
5,211,823
4,744,406
3,212,277
2,513,400
1,346,868
890,315
800,000
420,000
360,000
338,873
309,143
306,473
277,767
233,571
212,000
191,860
190,875
183,304
175,430
6,940,156
6,581,271
6,124,400
3,213,945
2,513,400
%
11.37%
8.54%
7.77%
5.26%
4.12%
2.21%
1.46%
1.31%
0.69%
0.59%
0.56%
0.51%
0.50%
0.46%
0.38%
0.35%
0.31%
0.31%
0.30%
0.29%
11.37%
10.78%
10.03%
5.27%
4.12%
3,344
3,907
839
565
31
8,686
984
Number of
shareholders
28,857,741
47.28%
On a show of hands, every member in person or by proxy shall have one vote. Upon a poll, voting rights of such members shall be
Fleetwood Corporation Limited, incorporated and domiciled in Australia, is a publicly listed company limited by shares.
21 Regal Place, East Perth, WA 6004 | Tel: (08) 9323 3300 | Fax: (08) 9202 1106 | info@fleetwood.com.au
ABN 69 009 205 261