GALE Pacific

2 0 2 2 
A N N U A L 
R E P O R T

A B O U T   
G A L E   PA C I F I C

GALE Pacific is an innovative, market-leading 
manufacturer of technical fabrics used for 
consumer and commercial applications 
around the world. 

2 0 2 2   H I G H L I G H T S

$205.5m

R E V E N U E
PCP: $205.2m

$22.9m

E B I T D A
PCP: $28.2m

$7.2m

N E T   C A S H   F L O W
from operating activities 
PCP: $34.6m

2.76c

E A R N I N G S   
P E R   S H A R E
PCP: 4.48c

$13.0m

E B I T
PCP: $19.0m

$(5.5)m

2.0c#

N E T   C A S H / ( D E B T )
PCP: $1.5m

T O TA L   D I V I D E N D
PCP: 4.0c^ unfranked

#   Interim dividend franked 
at 50% and final dividend 
franked at 75%

^ 

Includes 2.0 cent per 
share special dividend, 
unfranked

Revenue $m

Profit before tax $m

2019

2020

2021

2022

$149.2m

$156.3m

$205.2m

$205.5m

$4.8m

2019

2020

2021

2022

$11.2m

$11.0m

$17.2m

Operating Cash Flow $m

Net Cash/(Debt) $m

$15.3m

2019

2020

2021

2022

$7.2m

$7.2m

$34.6m

2019

2020

2021

2022

($10.9m)

($15.3m)

$1.5m

($5.5m)

* All figures compare FY22 to FY21 unless otherwise indicated 

 
1

2.76c

E A R N I N G S   

P E R   S H A R E

PCP: 4.48c

G L O B A L 
R E A C H 

with operations 
in Australia, 
New Zealand, USA, 
China, and Dubai

6 0 0 +   
S TA F F

G R O W T H 
F O C U S E D 

employed around the world 
working out of our 4 offices, 
4 manufacturing sites and 
8 warehouses

through innovation, 
category expansion, 
expanded distribution, 
and efficiency

C O N S U M E R 
P R O D U C T S 

C O M M E R C I A L 
P R O D U C T S 

includes outdoor roller shades, shade 
sails, shade and garden fabrics, shade 
structures and pet products sold 
through major retailers globally

includes knitted, coated, and advanced 
polymer fabrics for agricultural, 
architectural, construction, mining, 
and packaging

C O N T E N T S

1  2022 highlights

2  Chairman’s letter

4  FY22 overview

16  Directors’ report

27  Auditor’s independence declaration

28 Independent auditor’s report

8  Business overview

32 Directors’ declaration

10  Our Growth Acceleration Plan

33  Financial report

12  Board of directors

72   Additional Securities Exchange information

13  Executive leadership

76  Corporate directory

2022 ANNUAL REPORT | GALE PACIFIC |2

C H A I R M A N ’ S 
L E T T E R

“Our core markets, Australia and 
the Americas, produced significant 
second half revenue and profit growth 
compared to prior year.”

David Allman

The 2022 financial year presented considerable 
difficulties and operating complexities in the form 
of supply chain disruptions, significant input cost 
increases, changed trading patterns following 
increased COVID-induced demand during FY21, and 
operating restrictions at our plant in China. These 
factors particularly impacted the first half of the year.

I am pleased to report that despite all these 
difficulties our management team managed to 
maintain a high level of customer service throughout 
the year and also managed to achieve operating 
efficiencies and improvements.

During the first half, we successfully introduced 
price increases which, together with operating 
efficiencies, offset a proportion of the cost increases 
and led to much improved financial outcomes in the 
second half. Pleasingly, second half sales volumes 
held up well despite higher consumer prices, with 
new products and placements adding to growth.

As a result, both of our core markets, 
Australia and the Americas, produced 
significant second half revenue and 
profit growth compared to prior year.

of $11.0 million was 36% below prior year but more 
than double FY20. Earnings per share of 2.8 cents 
enabled dividends totalling 2 cents per share. Net 
cash generation of $7.2 million was impacted by 
the requirement to fund higher cost inventories 
and increased debtors which resulted from higher 
second half revenue, while net debt of $5.5 million 
at 30 June represented conservative gearing and a 
strong balance sheet.

Despite the difficult trading and operating conditions 
experienced during the first half of the year, we 
continued with our strategies aimed at building 
GALE into a much larger, fast growing global fabrics 
technology business.

Our most significant growth opportunity is to 
expand our presence in the large Americas market, 
and during FY21 we centralised a number of key 
management positions in the USA, where our 
managing director, John Paul Marcantonio, has been 
based since his appointment to the role in November 
2019. The management team has been further 
enhanced and streamlined globally and the new 
structure is working extremely well. Over the last two 
years, we have also invested in resources for the long 
term in other areas, particularly in sales, marketing 
and product development, and we have some very 
exciting products in our development pipeline. 

For the full year, revenue of $205.5 million was in 
line with FY21, but 31% above FY20. Profit before tax 

While these investments have resulted in 
considerable short-term increases in expenses, 

2022 ANNUAL REPORT | GALE PACIFIC |3

we are confident they will enable us to achieve 
our growth objectives. We now have a first-class, 
well-structured management team and we 
do not see the need to add further significant 
management resources.

The management team and all our employees 
have successfully dealt with numerous challenges 
over the past two, quite extraordinary, years while 
prioritising health and safety. I would like to thank all 
of them for their commitment during this period.

The second half results give us great confidence 
that our growth objectives are realistic and that we 
have the management team and strategies in place 
to achieve them. This has been confirmed through 
our engagement with our advisors Luminis Partners.

We are planning for and anticipating revenue and profit 
growth in FY23, driven mainly by the Americas region 
during its peak selling season in our second half.

David Allman
Chairman

$11.0m

P R O F I T 
B E F O R E TA X
PCP: $17.2m

2.0c

D I V I D E N D
PCP: 4.0c

2022 ANNUAL REPORT | GALE PACIFIC |4

G A L E   PA C I F I C 
F Y 2 2 O V E R V I E W

“We are energised by the momentum with 
which we finished the year, delivering 
double-digit increases in second-half 
revenue, earnings and profit.”

John Paul Marcantonio

C H I E F   E X E C U T I V E   O F F I C E R   &   
M A N A G I N G   D I R E C T O R ’ S   R E V I E W

The 2022 financial year was a tale of two separate 
halves in the face of continued, full-year macro 
complexity across our global supply chain and input 
cost inflation across our global operations. 

After a challenging first half, we are energised by 
the momentum with which we finished the year, 
delivering double-digit year-on-year increases in 
second-half revenue, earnings and profit.  

This result marks the third consecutive year of 
record second-half revenue and profit for the 
Company, driven by robust business performance in 
Australia and the United States, our anchor markets, 
and a return to growth in the Middle East & North 
Africa region.

We are encouraged by our ability to manage the 
headwinds we have faced across international 
shipping, logistics, input cost inflation, operating 
restrictions in China and overall market volatility 
throughout this reporting period and prior years.

Our results provide further evidence that our growth 
and operating strategies are working well and that 
our business and team are highly resilient in the 

face of continued challenging and complex global 
operating conditions.

Our pricing measures throughout the year offset a 
meaningful portion of the significant increase in input 
costs, with further benefits to be realised in FY23. 

We have additional price increases in place 
entering FY23 across all selling regions, and we 
are encouraged by some early signs of stabilisation 
across input cost categories.

Most importantly, we continued to invest in and 
accelerate our work to achieve our primary 
strategy and objective of building GALE Pacific 
into a fast-growing, world-class, global fabrics 
technology business.

We are a stronger company exiting FY22 with a 
newly reorganised, talented, experienced executive 
leadership team collaboratively and efficiently 
driving our growth strategy into action.

We have continued investing in people and 
capabilities to grow GALE Pacific well into the future, 
with a particular focus on sales, marketing and 

2022 ANNUAL REPORT | GALE PACIFIC |5

$7.2m

N E T   C A S H   F L O W
from operating activities
PCP: $34.6m

2022 ANNUAL REPORT | GALE PACIFIC |6

G A L E   PA C I F I C 
F Y 2 2 O V E R V I E W   ( c o n t i n u e d )

operational talent in the United States, given its scale 
and long-term growth potential for the Company.

The GALE Pacific Growth Acceleration Plan builds 
on our growth strategy. It outlines how we will grow 
the Company over the coming years by focusing 
our efforts, investments and teams on expanding 
our categories, markets, supply chain, capabilities 
and people.

In line with our growth framework, we have 
recently announced a significant investment 
to upgrade our ERP systems across markets to 
cloud-based Microsoft Dynamics 365. These 
system improvements will significantly enhance 
cybersecurity while enabling our team to scale the 
company efficiently to achieve our growth plans.

We added new consumer insights, concept 
development and testing capabilities to the 
Company in FY22. These have improved the 
quality and scale of our innovation and new product 
funnel, with the team preparing to launch in FY23 
the Company’s most significant new-to-world 
fabric innovation for the consumer and commercial 
end-markets in many years.

We are confident that our brands and products have 
significant growth potential outside Australia and the 
United States. We now have the supply chain and 
operational capabilities to service this core element 
of our growth strategy. We will invest in growing 
these new and developing markets for GALE Pacific 
in FY23.

Our supply chain and operations teams are now 
aligned and integrated, forming ONE Global GALE 
Supply Chain team. Our planning, procurement, 
manufacturing, delivery, distribution and service 
teams are responsible for improving our operations 
by increasing efficiency, capacity utilisation 
and flexibility while delivering productivity and 
attacking the trapped cost of failure across our 
global business.

The key differentiator for our organisation over 
the coming years is also our most important 
responsibility as leaders, which is to grow our 
people. With our Attract, Engage, Develop 
organisational development model, we’ll build 
and mobilise our team to deliver our growth 
plans while concurrently building our functional 
leadership capabilities.

Our goal is to build and empower the team to double 
our business by becoming an employer of choice for 
top talent to grow their careers. The results of our 
annual employee engagement survey show that we 
have made breakthrough progress toward this goal 
over the last year. 

I would like to conclude by first thanking our 
entire GALE Pacific team for their hard work 
and commitment to improving the Company’s 
operations and service while concurrently 
delivering record results in a highly challenging 
operating environment. 

In addition, I would like to thank my fellow directors 
for their collaboration, support, counsel and 
continued belief in our team and our plan to build a 
larger, stronger GALE Pacific well into the future. 

Finally, thank you, our shareholders, for your 
continued support. 

The opportunities in front of us energise us.

We are just getting started.  

John Paul Marcantonio
Chief Executive Officer & Managing Director

2022 ANNUAL REPORT | GALE PACIFIC |G R O W T H  A C C E L E R AT I O N  P L A N

V A L UES

Integrity  |  Respect  |  Collaboration
People  |  Community
Innovation

S
E
I
R
O
G
E

T

A

Consumer and 
commercial 
technical fabrics 
and associated 
finished 
goods

V I S I O N

Build GALE Pacific into
a fast-growing, world-class, 
global fabrics technology 
business

Americas

Australia and
New Zealand

Developing 
Markets

M

A
R
K
E
T
S

C

A high-performance culture of great leaders 
and functional experts known for 
best-in-class results

T E A M

G R O W   O U R 
C AT E G O R I E S

 ■ DEVELOP AND LAUNCH breakthrough innovation in our core categories

 ■ ACCELERATE new & near neighbour category entry

 ■ ACCELERATE penetration via leadership brand activation and communication

W
O
R
G

E
W

W
O
H

G R O W   O U R 
M A R K E T S

 ■ DRIVE CATEGORY GROWTH in retail & commercial in Australia & the United States

 ■ RAPIDLY EXPAND distribution & availability in the United States

 ■ EXTEND OUR BORDERS into Latin America,Southeast Asia,Canada, Middle East & Europe

G R O W 
O U R  S U P P LY 
C H A I N

 ■ LEVERAGE ONE Global GALE Supply Chain | Plan, Procure, Manufacture, Deliver, 

Distribute & Serve

 ■ ENHANCE utilisation, efficiency & flexibility across our global supply chain and operations

 ■ EXPAND productivity delivery & ATTACK trapped cost of failure 

G R O W   O U R 
C A PA B I L I T I E S

 ■ SIMPLIFY OUR BUSINESS and ways of working for improved clarity, efficiency & execution 

 ■ BUILD & IMPLEMENT the right global IT strategy, tools & team to enable our growth plans

 ■ DEEPEN OUR INSIGHTS & INNOVATION capabilities to accelerate our growth strategy

G R O W   O U R 
P E O P L E

 ■ DEVELOP our functional leadership capabilities throughout the organisation

 ■ EMBED our Attract, Engage, Develop organisational development model

 ■ BUILD & EMPOWER the team to DOUBLE by becoming an employer of choice 

for TOP TALENT to GROW their CAREERS

D E L I V E R E D   W I T H  E D G E:  E very Day Great Execution

7

18

|

C

I
F
I

C
A
P

E
L
A
G

|

S
T
L
U
S
E
R

2
2
Y
F

2022 ANNUAL REPORT | GALE PACIFIC | 
 
 
 
 
 
 
B U S I N E S S  O V E R V I E W

8

Gale Pacific is a fast-growing, world-class global 
fabrics technology business.

We are a market leading manufacturer and innovator of technical fabrics used 
for consumer and commercial applications around the world. Our products 
are used in various industries, such as architectural, agricultural, mining, 
construction and home improvement.

Americas 
Second-half revenue of $62.7 million and EBITDA 
of $13.3 million were records for GALE in the 
Americas region for the third consecutive year. 

Australia & New Zealand
Delivered a robust second half despite weather 
and supply chain challenges. Primary drivers 
were increased demand for fabrics used in 
grain handling and water containment and for 
non-woven coated products used in food handling.

Middle East & North Africa 
Improving business conditions, increased 
infrastructure project investment, new products, 
price increases and GALE’s tightened credit policy 
improved overall and long-dated debtors drove 
revenue and EBITDA growth in the second half.

Eurasia 
Revenue and EBITDA were lower compared to 
corresponding prior periods, driven primarily by 
demand normalisation across both commercial and 
consumer end-markets and despite price increases 
across the market.

2022 ANNUAL REPORT | GALE PACIFIC |“We are confident that our brands and products have 
significant growth potential outside Australia and the 
United States. ”

John Paul Marcantonio

9

M A P   L E G E N D :  

  Head office 

  Sales office 

  Warehouse 

  Manufacturing 

Los Angeles, USA

Dubai, UAE

Ningbo, China

Orlando, USA

2 0 2 2 
R E V E N U E
by region

Perth, Australia

Brisbane, Australia

Melbourne, Australia

Auckland, New Zealand

2 0 2 2 
E B I T D A
by region

● Australia & New Zealand
● Americas
● Middle East & North Africa
● Eurasia

Revenue 
$m

EBITDA 
$m

93.7

95.6

8.5

7.6

11.5

13.0

1.5

2.5

2022 ANNUAL REPORT | GALE PACIFIC | 
 
 
 
 
 
 
 
10

O U R   G R O W T H 
A C C E L E R AT I O N   P L A N

The Growth Acceleration Plan framework to grow the 
Company in the United States and Australia and build its 
business across new and developing markets.

V A L UES

Integrity  |  Respect  |  Collaboration
People  |  Community
Innovation

S
E
I
R
O
G
E

T

A

Consumer and 
commercial 
technical fabrics 
and associated 
finished 
goods

V I S I O N

Build GALE Pacific into
a fast-growing, world-class, 
global fabrics technology 
business

Americas

Australia and
New Zealand

Developing 
Markets

M

A
R
K
E
T
S

C

A high-performance culture of great leaders 
and functional experts known for 
best-in-class results

T E A M

2022 ANNUAL REPORT | GALE PACIFIC | 
11

W
O
R
G

E
W

W
O
H

G R O W   O U R 
C AT E G O R I E S

 ■ DEVELOP AND LAUNCH breakthrough innovation in 

our core categories

 ■ ACCELERATE new & near neighbour category entry

 ■ ACCELERATE penetration via leadership brand 

activation and communication

G R O W   O U R 
M A R K E T S

 ■ DRIVE CATEGORY GROWTH in retail & commercial 

in Australia & the United States

 ■ RAPIDLY EXPAND distribution & availability in the 

United States

 ■ EXTEND OUR BORDERS into Latin America & 
Southeast Asia; expand Canada, Middle East 
& Europe

G R O W   O U R 
S U P P LY   C H A I N

 ■ LEVERAGE ONE Global GALE Supply Chain | Plan, 
Procure, Manufacture, Deliver, Distribute & Serve

 ■ ENHANCE utilisation, efficiency & flexibility across our 

global supply chain and operations

 ■ EXPAND productivity delivery & ATTACK trapped cost 

of failure 

G R O W   O U R 
C A PA B I LT I T E S

 ■ SIMPLIFY OUR BUSINESS and ways of working for 

improved clarity, efficiency & execution 

 ■ BUILD & IMPLEMENT the right global IT strategy, 

tools & team to enable our growth plans

 ■ DEEPEN OUR INSIGHTS & INNOVATION 

capabilities to accelerate our growth strategy

G R O W   O U R 
P E O P L E

 ■ DEVELOP our functional leadership capabilities 

throughout the organisation

 ■ EMBED our Attract, Engage, Develop organisational 

development model

 ■ BUILD & EMPOWER the team to 

DOUBLE by becoming an employer of choice 
for TOP TALENT to GROW their CAREERS

D E L I V E R E D   W I T H   E D G E : 
Every  Day  Great  Execution

2022 ANNUAL REPORT | GALE PACIFIC | 
 
B O A R D   O F   D I R E C T O R S

12

DAVID ALLMAN, 
B.SC.

CHAIRMAN AND NON-
EXECUTIVE DIRECTOR 
SINCE NOVEMBER 2009
David was Managing Director 
of McPherson’s Limited 

from 1995 to 2009 and prior to that was Managing 
Director of Cascade Group Limited for seven years. 
Before this David held senior positions with Elders 
IXL Limited and Castlemaine Tooheys Limited. David 
holds a degree in engineering and prior to obtaining 
general management positions held managerial 
roles in production management, finance and 
marketing. During the last three years David has 
been Chairman of Catalyst Education Pty Ltd and 
Chairman of Direct Couriers Group Pty Ltd.

David is the Chairman of the Company’s Nomination 
Committee and is a member of the Remuneration 
and Audit and Risk Committees.

PETER LANDOS, 
B.ECON., CA

NON-EXECUTIVE 
DIRECTOR SINCE 
MAY 2014
Peter is the Chief Operating 
Officer of the Thorney 

Investment Group of Companies which he joined in 
2000 having previously worked at Macquarie Bank 
Limited. Peter has extensive business and corporate 
experience specialising in advising boards and 
management in mergers and acquisitions, divestments, 
business restructurings and capital markets. 

Peter is a non-executive director of Adacel 
Technologies Limited, Chairman of PRT Company 
Limited (formerly Prime Media Group Limited) and 
a non-executive director of various entities within 
the Australian Community Media Group including 
20 Cashews Pty Ltd and Rural Press Pty Ltd.

Peter is the Chairman of the Audit and Risk 
Committee and is a member of the Company’s 
Nomination Committee.

DONNA 
MCMASTER, GAICD

NON-EXECUTIVE 
DIRECTOR SINCE 
MARCH 2018
Donna has extensive 
experience in senior executive 

and strategic roles within public and private retail 
companies, with a proven track record in retail, 
brand and product development, marketing 
and communications.

Donna serves on multiple Boards and is currently 
Board Chair & Non-Executive Director of Dandenong 
Market Pty Ltd, Deputy Chair & Non-Executive 
Director of YMCA Service Pty Ltd where she is 
also Chair of the HR & Governance Committee, 
Non-Executive Director with Leading Edge Retail 
where she is also Chair of the Remuneration 
Committee and Non-Executive Director of Leading 
Edge, New Zealand.

Donna is a member of the Company’s Nomination 
and Remuneration Committees.

TOM STIANOS, 
B.APP.SC., FAICD

NON-EXECUTIVE 
DIRECTOR SINCE 
OCTOBER 2017
Tom has extensive experience 
as a non-executive director 

of listed companies including many years as 
Managing Director. Tom is currently Chairman of 
Xref Limited (ASX:XF1), and Chairman of Escient. 
Tom was previously chairman of Empired Limited 
(ASX:EPD) a non-executive director of Inabox Group 
(ASX:IAB), CEO of SMS Management & Technology 
(ASX:SMX), and Director of the Australian Information 
Industry Association.

Tom is the Chairman of the Remuneration Committee 
and is a member of the Company’s Nomination and 
Audit and Risk Committees.

2022 ANNUAL REPORT | GALE PACIFIC |E X E C U T I V E   L E A D E R S H I P

13

JOHN PAUL 
MARCANTONIO

CEO & MANAGING 
DIRECTOR
John Paul joined GALE Pacific 
in October 2017 as the 
General Manager of the 

Americas business. He was appointed Chief 
Executive Officer in November 2019 and then 
Managing Director in August 2020. John Paul has 
broad experience working globally across consumer 
and commercial product sectors. Before joining 
GALE Pacific, John Paul built his career at Newell 
Brands in roles of increasing responsibility and 
scope in marketing, sales, and management over 
fifteen years. He has held multiple global product 
and brand marketing leadership positions over his 
tenure. John Paul lived and worked in Melbourne, 
Australia, as the Marketing Director of Newell 
Brands’ APAC hardware business.

MATT RUSSELL

CHIEF HUMAN 
RESOURCES OFFICER
Matt joined GALE Pacific in 
January 2021 as the Chief 
Human Resources Officer 
and leader of the Global 

Health & Safety Environmental function for GALE 
Pacific. Matt has extensive experience leading the 
Human Resources function for public and private 
equity-backed global businesses in consumer and 
commercial durable goods. Before joining GALE 
Pacific, Matt was the global Human Resources leader 
for several business units of Newell Brands, most 
recently the Rubbermaid & Rubbermaid Commercial 
Business Unit. During his tenure with Newell 
Brands, Matt lived in Hong Kong, serving as the Vice 
President, Human Resources for the Asia Pacific 
region. Matt spent 15 years with Newell Brands in 
Human Resources roles of increasing responsibility 
and scope.

SHERYL SMITH

CHIEF FINANCIAL 
OFFICER
Sheryl joined GALE Pacific 
in January 2022 and has 
extensive experience working 
in various finance leadership 

positions for global manufacturing companies. 
Before joining GALE Pacific, Sheryl held roles of 
increasing worldwide responsibility and scope in 
finance at Polypore International, including the 
previous four years as the company’s CFO, GETRAG 
Corporation, PPG, and Morgan Stanley. Sheryl holds 
an International Master of Business Administration 
from the University of South Carolina and a Master 
of International Business from the Escuela de 
Administracion de Empresas in Barcelona, Spain.

ADAM BOCCELLI

GLOBAL VICE 
PRESIDENT | SUPPLY 
CHAIN
Adam joined GALE Pacific 
in August 2020 as the 
Vice President, Americas 

Operations for GALE Pacific. He assumed 
responsibility for GALE’s global supply chain 
functions, including the company’s manufacturing 
operations in Ningbo, China, in August of 2021. 
Adam has extensive experience leading global 
supply chain functions, including planning, sourcing, 
manufacturing, and logistics of international 
businesses in the consumer, high tech, and medical 
diagnostics industries. Before joining GALE Pacific, 
Adam held several roles as a global operations 
leader for IDEXX Laboratories with positions of 
increasing responsibility and scope. Before IDEXX, 
Adam held roles with 3rd Party Logistics providers 
and publicly held consumer goods companies. Adam 
is also a United States Marine Corp veteran.

2022 ANNUAL REPORT | GALE PACIFIC |E X E C U T I V E   L E A D E R S H I P 

14

NATHAN 
BIRCKHEAD

GLOBAL VICE 
PRESIDENT | IT
Nathan joined GALE Pacific 
in June 2021 and has 
extensive experience in the 

Information Technology function, having held various 
leadership positions during his career. Before joining 
GALE Pacific, Nathan was the Director of Information 
Technology for Omni-Parts Automotive, a wholly 
owned affiliate of Nissan Motor Company. Nathan 
developed, implemented, and led all aspects of 
the IT function, strategy, team, and infrastructure 
for Omni’s automotive parts aftermarket business 
venture. Before joining Omni, Nathan spent ten 
years with Nissan in various IT roles of increasing 
responsibility and leadership.

TROY MORTLEMAN

GENERAL MANAGER |  
AUSTRALIA & 
NEW ZEALAND & 
DEVELOPING MARKETS
Troy joined GALE Pacific 
in January 2020. Over the 
last 14 years, he has built an impressive career at 
previously NZX listed Methven Ltd (MVN) as the 
Chief Operating Officer of Methven Australia. Troy 
held various senior roles of increasing responsibility 
in sales and general management and has 
experience across both retail & commercial channels 
of distribution for both consumer & commercial 
durables categories. Troy has a proven track record 
of concurrently building growing businesses while 
developing and leading high-functioning teams. 
Troy holds a Master of Business Administration from 
Deakin University and is a Graduate Member of the 
Australian Institute of Company Directors.

KEVIN HARSHAW

VICE PRESIDENT & 
GENERAL MANAGER 
| AMERICAS & 
INNOVATION
Kevin Harshaw joined 
GALE Pacific in August 2021 

as the company’s Vice President of Global Marketing 
& Innovation. In January 2022, Kevin assumed 
additional responsibility as the General Manager 
of the Americas region. Before joining GALE 
Pacific, Kevin Harshaw built an international career 
with leadership positions at Procter & Gamble, 
Reckitt, Kimberly-Clark, and private equity-backed 
companies. Kevin has lived and worked in the 
United States, Canada, Switzerland, and Thailand, 
leading local, regional, and global organisations 
across Health/OTC, Fabric Care, Personal Care, 
and Outdoor categories. Kevin has a track record 
of concurrently developing and launching global 
innovations that meet consumers’ needs and 
energizing teams to overdeliver results.

2022 ANNUAL REPORT | GALE PACIFIC |C O R P O R AT E   G O V E R N A N C E

15

The Company’s Directors and management are 
committed to conducting the Group’s business in an 
ethical manner and in accordance with the highest 
standards of corporate governance. The Company 
has adopted and complies with the ASX Corporate 
Governance Principles and Recommendations (Fourth 
Edition) (Recommendations).

The Company has prepared a statement which sets 
out the corporate governance practices that were in 
operation throughout the financial year for the Company 
(Corporate Governance Statement).

In accordance with ASX Listing Rules 4.10.3 and 4.7.4, 
the Corporate Governance Statement will be available 
for review on Gale Pacific’s website (https://www. 
galepacific.com/investor-info/corporate-governance) 
and will be lodged together with an Appendix 4G 
with ASX at the same time that this Annual Report is 
lodged with ASX. The Appendix 4G will particularise 
each Recommendation that needs to be reported 
against by Gale Pacific, and will provide shareholders 
with information as to where relevant governance 
disclosures can be found.

The Company’s corporate governance policies 
and charters are all available on Gale Pacific’s 
website (https://www.galepacific.com/investor-info/
corporategovernance).

2022 ANNUAL REPORT | GALE PACIFIC |16

The directors present their report, together with the 
consolidated financial statements, of Gale Pacific 
Limited (referred to hereafter as the ‘Company’ or 
‘Parent entity’) and its controlled entities (together the 
‘Group’) for the year ended 30 June 2022 and the 
independent Auditor’s report thereon.

Changes in state of affairs
Throughout the COVID-19 global pandemic, the 
Group has prioritised the health and safety of its team, 
allowing remote work for those able to perform their 
job responsibilities in a remote work environment and 
ensuring the health, safety, and hygiene protocols 
across all global locations. The Group continues to 
operate in line with jurisdictional requirements and 
best available practices across its operating entities. 
The Group’s global supply chain proved resilient, 
effectively managing through delays and cost inflation 
and disruption across international and local logistics 
with a focus on ensuring customer service through 
increased inventory holdings, particularly in the United 
States and Australia. The Group efficiently managed 
the challenges imposed by mandated production 
interruptions to its Ningbo, China, manufacturing 
facility due to electricity restrictions and COVID-19 
lockdown protocols in both Ningbo and Shanghai 
throughout the year. As presented in the executive 
leadership section of the annual report, the Group’s 
restructured executive leadership team brings improved 
capabilities in human resources, finance, marketing, 
innovation, information technology, and global supply 
chain management and aligns clearly with the Group’s 
growth acceleration strategy. Additionally, the Group 
identified and commenced the work on the Charlotte, 
NC office location, US-based members of the executive 
leadership team will relocate to the Charlotte area to 
leverage the key geographic region as it relates to key 
customers and the textile industry. 

Principal activities
During the financial year, the principal continuing 
activities of the Group consisted of marketing, sales, 
manufacture and distribution of branded screening, 
architectural shading, commercial agricultural 
/ horticultural fabric products to domestic and 
global markets.

Review of operations
The profit for the Group after providing for income 
tax amounted to $7,617,000 (30 June 2021: profit 
of $12,327,000).

Events subsequent to balance date
Apart from the dividend declared, no other matter or 
circumstance has arisen since 30 June 2022 that has 
significantly affected, or may significantly affect the 
Group’s operations, the results of those operations, or 
the Group’s state of affairs in future financial years.

Environmental regulation and 
performance
The Group’s operations are not subject to any significant 
environmental regulations under the Commonwealth or 
State legislation. The Directors believe that the Group 
has adequate systems in place for the management of 
its environmental requirements and is not aware of any 
breach of those environmental requirements as they 
apply to the Group.

GALE assesses its exposure to climate risks and 
incorporates such assessments into its annual 
strategic planning process. The identified risks and 
possible impacts associated with the climate risks are 
appropriately considered and integrated into the various 
levels of planning and decision-making that drive the 
company’s go-forward strategy.

Dividends
Dividends paid to members during the financial year 
were as follows:

Final Dividend for the year ended 
30 June 2021 (paid 15 October 2021)

2022

2.00 cents

Interim Dividend for the 6 months ended 
31 Dec 2021 (paid 14 April 2022)

1.00 cent

In addition to the above dividends, on the 23 August 
2022 the Directors declared a dividend of 1.00 cent 
per share to the holders of fully paid ordinary shares in 
respect of the year ended 30 June 2022, payable on 
14 October 2022 to shareholders on the register at 30 
August 2022. The final dividend will be franked at 75%. 

DIRECTORS’ REPORTfor the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |17

This dividend has not been included as a liability in these financial statements. The total estimated dividend to be 
paid is $2,800,000.

For the full year, dividends of 2.00 cents per share have been declared on earnings of 2.76 cents per share.

Share based payments

Performance rights
The number of performance rights on issue at the date of this report is 18,980,338 (2021: 17,907,971). No amount is 
payable on the vesting of a performance right. Each performance right entitles the holder to one (1) ordinary share 
in Gale Pacific Limited in the event that the performance right is exercised. Performance rights carry no rights to 
dividends and no voting rights.

In the current financial year, a total of 3,074,000 performance rights (December 2021, 2,870,000 performance rights 
and April 2022, 204,000 performance rights) were granted to executive officers (excluding the CEO & MD) and 
senior managers under the Company’s Performance Rights Plan scheme for a three year period to 30 June 2024. 

2,451,000 performance rights that were issued to executive officers and senior managers is subject to meeting the 
two vesting conditions (performance hurdle and time hurdle) as outlined below. 

623,000 performance rights were issued to executive officers and senior managers is subject only to the vesting 
condition related to time hurdle as outlined below.

Vesting conditions
Performance hurdle – The compound annual growth rate (CAGR) of the diluted earnings per share over the relevant 
performance period should be greater than 3%. The vesting % will be prorated between 0% and 100% for CAGR less 
than 3% and 10% or above respectively. 

Time hurdle – Continuous employment from the grant date to 30 September 2024.

During the financial year, a total of 1,001,732 performance rights vested and 999,901 performance rights forfeited. 
The vesting and forfeiting of those performance rights was subject to a continuation of employment for three years 
and the satisfactory achievement of performance hurdles based on improvements in the Group’s diluted earnings 
per share over the three year period between 1 July 2018 and 30 June 2021.

Further details of the options and performance rights movements during the reporting period are disclosed in the 
Remuneration Report.

Directors’ shareholdings
The following table sets out each Director’s relevant interest in shares, options and performance rights in shares of 
the Company as at the date of this report.

Directors

D Allman

P Landos

D McMaster

T Stianos

J P Marcantonio

Fully Paid 
Ordinary 
Shares

4,500,000

–

50,000

600,000

285,882

Options

Performance 
Rights

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

14,000,0001

1   In accordance with the early achievement criteria of the three-year incentive scheme in place for the CEO & Managing Director, 
TSR hurdles up to 30 June 2022 have been satisfied and accordingly 7,621,600 performance rights will convert to ordinary 
fully paid shares subject to all of the other requirements under the incentive scheme being met.

2022 ANNUAL REPORT | GALE PACIFIC |18

Directors’ meetings
The table below sets out the attendance by Directors.

Board of Directors’ 
Meetings

Audit and Risk 
Committee Meetings

Remuneration 
Committee Meetings

Nomination 
Committee Meetings

No. of 
Meetings 
Eligible 
to Attend Attended

No. of 
Meetings 
Eligible 
to Attend Attended

No. of 
Meetings 
Eligible 
to Attend Attended

No. of 
Meetings 
Eligible 
to Attend Attended

10

10

10

10

10

10

10

10

10

10

5

5

–

5

–

5

5

–

5

–

1

–

1

1

–

1

–

1

1

–

–

–

–

–

–

–

–

–

–

–

Directors

D Allman

P Landos

D McMaster

T Stianos

JP Marcantonio

As at the date of this report, the Company has an Audit 
& Risk Committee, a Remuneration Committee and a 
Nomination Committee of the Board of Directors.

As at the date of this report the members of the Audit 
& Risk Committee are Peter Landos, Tom Stianos 
and David Allman. The Chairman of the Audit & Risk 
Committee is Peter Landos. 

As at the date of this report the members of the 
Remuneration Committee are Tom Stianos, David 
Allman and Donna McMaster. The current Chairman of 
the Remuneration Committee is Tom Stianos.

As at the date of this report the members of the 
Nomination Committee are David Allman, Peter Landos, 
Donna McMaster, and Tom Stianos. The Chairman of the 
Nomination Committee is David Allman.

Remuneration report
This report contains the remuneration arrangements in 
place for Directors and Executives of the Group.

The Remuneration Committee reviews the remuneration 
packages of all Directors and Executive Officers on 
an annual basis and makes recommendations to the 
Board. Remuneration packages are reviewed with due 
regard to performance and other relevant factors, and 
advice is sought from external advisors in relation to 
their structure.

The Group’s remuneration policy is based on the 
following principles:

 ■ Provide competitive rewards to attract high 

quality executives;

 ■ Provide an equity incentive for senior executives 

that will provide an incentive to executives to align 
their interests with those of the Group and its 
shareholders; and

 ■ Ensure that rewards are referenced to relevant 

employment market conditions.

Remuneration packages contain the following 
key elements:

 ■ Primary benefits – salary/fees; 

 ■ Benefits, including the provision of motor vehicles 
and incentive schemes, including performance 
rights; and

 ■ Performance rights, if the performance criteria 

and any Board discretion are satisfied, entitle an 
executive to be issued shares in the Company 
at no cost to the executive. Shares are issued 
subsequently after the time all performance rights 
vesting conditions are met

DIRECTORS’ REPORT (continued)for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |19

Relationship between the remuneration policy and Company performance
The table below set out summary information about the Group’s earnings and movements in shareholder wealth for 
the five years to 30 June 2022:

Sales (‘000s)

Net profit before tax (‘000s)

Net profit after tax (‘000s)

Share price at start of year

Share price at end of year

Interim dividend

Final dividend

Basic earnings per share

Diluted earnings per share

30 June 
2022

30 June 
2021

30 June 
2020

30 June 
2019

30 June 
2018

205,543

205,223

156,338

149,217

10,952

7,617

17,220

12,327

4,757

3,719

11,208

9,198

148,811

12,484

9,807

41.0 cents

16.0 cents

32.0 cents

35.5 cents

40.0 cents

29.0 cents

41.0 cents

16.0 cents

32.0 cents

35.5 cents

1.00 cent

2.00 cents

0.0 cent

1.00 cent

1.00 cent

1.00 cent

2.00 cents

1.00 cent

1.00 cent

1.00 cent

2.76 cents

4.48 cents

1.34 cents

3.21 cents

3.35 cents

2.59 cents

4.21 cents

1.32 cents

3.16 cents

3.29 cents

Remuneration Practices
The Group policy for determining the nature and 
amount of emoluments of Board members and Senior 
Executives is as follows. The remuneration structure 
for Executive Officers, including Executive Directors, 
is based on a number of factors including length 
of service, particular experience of the individual 
concerned, and overall performance of the Group. The 
contracts of service between the Group and Executive 
Directors and Executives are on a continuing basis, 
the terms of which are not expected to change in the 
immediate future. Upon retirement Executive Directors 
and Executives are paid employee benefit entitlements 
accrued to date of retirement. Payment of bonuses, and 
other incentive payments are made at the discretion 
of the Remuneration Committee to Key Executives of 
the Group based predominantly on an objective review 
of the Group’s financial performance, the individuals’ 
achievement of stated financial and non financial targets 
and any other factors the Committee deems relevant. 

Non Executive Directors receive a fee for being 
Directors of the Company and do not participate in 
performance based remuneration. 

Remuneration Practices
In accordance with best practice corporate governance, 
the structure of Non Executive Directors and Senior 
Managers remuneration is separate and distinct.

Non-executive directors remuneration
The Board seeks to set remuneration at a level which 
provides the Company with the ability to attract and 

retain directors of relevant experience and skill, whilst 
incurring costs which are acceptable to shareholders.

The Company’s Constitution and the Australian 
Securities Exchange Listing Rules specify that the 
aggregate remuneration of Non Executive Directors 
shall be determined from time to time by a general 
meeting. An amount not exceeding the amount 
determined is then divided between the Directors 
as agreed. The last determination was at the Annual 
General Meeting held on 25 October 2019 when 
shareholders approved the Company’s constitution 
which provides for an aggregate remuneration of 
$600,000 per annum. The amount of the aggregate 
remuneration and the manner in which it is apportioned 
is reviewed periodically. The Board considers fees paid 
to Non Executive Directors of comparable companies 
when undertaking this review process.

Each non executive director receives a fee for being 
a director of the Company and does not participate in 
performance based remuneration. 

Senior manager and executive director 
remuneration
The Group aims to reward executives with a level and 
mix of remuneration commensurate with their position 
and responsibilities within the Group. The objective of 
the remuneration policy is:

 ■ Reward executives for Group and individual 

performance;

 ■ Align the interests of the executives with those of 

the shareholders; and

2022 ANNUAL REPORT | GALE PACIFIC |20

 ■ Ensure that total remuneration is competitive by 

market standards.

In determining the level and make up of executive 
remuneration, the Remuneration Committee reviews 
reports detailing market levels of remuneration for 
comparable roles. Remuneration consists of fixed and 
variable elements.

The executive remuneration packages contain the 
following key elements:

 ■ Primary benefits – salary/fees; 

 ■ Cash bonuses – One year short term performance 
cash bonus payments are awarded in accordance 
with the Company’s remuneration policy. The 
budget targets for each business unit and the 
Company overall is established each year by the 
Board. The performance criteria include sales and 
earnings before interest and tax growth and working 
capital management. For corporate executives, the 
performance criteria include growth in earnings 
before interest and tax and profit after tax.

 ■ Share based payments, if the performance criteria 
and any Board discretion are satisfied, entitle an 
executive or senior manager to be issued shares in 
the Company at no cost to them. Shares are issued 
subsequently after the time all performance rights 
vesting conditions are met.

The combination of these comprises the senior 
manager and executive ‘s total remuneration.

Share-based payments
The Group maintains a performance rights scheme 
for certain staff and executives, including the Group 
Managing Director and Chief Executive Officer, as 
approved by shareholders at an annual general 
meeting. These schemes are designed to reward key 
personnel when the Group meets performance hurdles 
increasing the diluted earnings per share and relate to:

 ■ Improvement in earnings per share; and

 ■ Improvement in return to shareholders.

The number of performance rights on issue as at 
30 June 2022 was 18,980,338. 559,338 of these 
performance rights were granted on 16 January 2020 
and will not vest until the time of the Company’s 2022 
annual report is released on the ASX (on or around 
1 October 2022). 1,347,000 of these performance rights 
were granted on 30 October 2020 and 14,000,000 
of these performance rights were granted on 

23 December 2020 and both will not vest until the time 
of the Company’s 2023 annual report is released on 
the ASX (on or around 1 October 2023). 3,074,000 of 
these performance rights were granted in this financial 
year and will not vest until the time of the Company’s 
2024 annual report is release on the ASX (on or 
around 1 October 2024). Each performance right has 
$nil exercise price and entitles the holder to one (1) 
ordinary share in Gale Pacific Limited and is subject to 
satisfying the relevant performance hurdles based on 
improvements in the Group’s diluted earnings per share.

Options and performance rights issued to executives 
during the year were issued in accordance with the 
Group’s remuneration policy which: 

 ■ Reward executives for Group and individual 

performance;

 ■ Align the interests of the executives with those of 

the shareholders; and

 ■ Ensure that total remuneration is competitive by 

market standards.

Key management personnel of 
the group who held office during 
the year

Non-executive directors
D Allman (Chairman Non Executive)

P Landos (Non Executive)

D McMaster (Non Executive)

T Stianos (Non Executive)

Executive officers
J P Marcantonio (CEO and Managing Director)

M Russell (Global Chief Human Resources Officer) – 
appointed 10 August 2021 (previously Chief Human 
Resources Officer)

A Boccelli (Global Vice President, Supply Chain) – 
appointed 10 August 2021 (previously Vice President 
Operations – Americas)

K Harshaw (Vice President/General Manager of the 
Americas) – appointed 1 January 2022 (previously Head 
of Global Marketing and Innovation)

T Mortleman (General Manager – ANZ / Vice President 
Developing Markets) – appointed 23 February 2022)

DIRECTORS’ REPORT (continued)for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |21

S Smith (Chief Financial Officer) – appointed 31 January 2022

M Nicholls (General Manager – EurAsia) – effective 23 February 2022, the role is not considered as 
Key Management

A Haidar (General Manager – Middle East & North Africa) – effective 23 February 2022, the role is not considered as 
Key Management

D Romanelli (Chief Financial Officer) – resigned 30 September 2021

C Zhang (General Manager – China Manufacturing) – resigned 30 September 2021

Except as noted, the named persons held their current position for the whole of the financial year and since the end 
of the financial year.

Remuneration of key management personnel: 

Short Term Benefits

Salary & 
Fees 
$

Bonus 
$

Other7 
$

Non 
Mone-
tary 
$

Post 
employ-
ment

Share 
Based 
Pay-
ments

Super 
$

Rights 
$

Term-
ination 
Ben-
efits 
$

Performance 
Related

Total 
$

Total 
%

Rights 
%

2022

Non-Executive Directors

D Allman

P Landos*

T Stianos

D McMaster

Executive Officers

117,756

95,388

 87,123

77,169

–

–

–

–

–

–

–

–

–  19,752 

–

–

–

 7,375 

 8,712 

 7,717 

–

–

–

–

– 137,508

– 102,763

– 95,836

– 84,886

J P Marcantonio

636,206

– 480,106

14,535

19,424 882,806

– 2,033,077

S Smith1

M Russell2

A Boccelli3

153,676

41,061

343,388

91,751

–

–

113

6,915

5,959

19,759

16,415

41,757

303,114

81,556

53,734

17,347

19,015

18,980

K Harshaw4

192,891

78,494 106,297

10,787

10,678 22,630

T Mortleman 

306,213 95,083

M Nicholls5

A Haidar5

D Romanelli6

C Zhang6

145,136

10,123

179,581 22,226

80,325

55,596

–

–

–

–

–

–

–

– 23,568 56,407

11,699

47,694

–

63,351

–

–

–

–

8,033

– 124,880 213,238

–

–

47,054 102,650

– 207,725

– 513,069

– 493,746

– 421,775

– 481,270

– 214,651

– 265,158

–

–

–

–

43%

23%

26%

20%

24%

31%

27%

32%

0%

0%

–

–

–

–

43%

3%

8%

4%

5%

12%

22%

24%

0%

0%

1   S Smith (Chief Financial Officer) – appointed 31 January 2022

2   M Russell (Global Chief Human Resources Officer) – appointed 10 August 2021 (previously Chief Human Resources Officer)

3   A Boccelli (Global Vice President, Supply Chain) – appointed 10 August 2021 (previously Vice President  

Operations – Americas)

4   K Harshaw (Vice President/General Manager of the Americas) – appointed 1 January 2022 (previously Head of Global 

Marketing and Innovation)

5   Effective 23 February 2022, the role is not considered as Key Management

6   Resigned 30 September 2021

7   Relocation benefits paid

*  The Director’s fees payable to P Landos are paid directly to Thorney Investment Group

2022 ANNUAL REPORT | GALE PACIFIC |22

Short Term Benefits

Salary & 
Fees 
$

Bonus 
$

Other 
$

Non 
Mone-
tary 
$

Post 
employ-
ment

Share 
Based 
Pay-
ments

Super 
$

Rights 
$

Term-
ination 
Ben-
efits 
$

Performance 
Related

Total 
$

Total 
%

Rights 
%

2021

Non-Executive Directors

D Allman

P Landos*

T Stianos

D McMaster

117,756

95,388

 87,123

77,169

Executive Officers

J P Marcantonio

599,910

–

–

–

–

–

T Mortleman

279,125 121,857

M Nicholls

A Haidar

206,922

73,124

255,025 33,624

D Romanelli

319,725 186,730

C Zhang

209,173

42,851

–  19,752 

–

–

–

 7,375 

 8,277 

 7,331 

–

–

–

–

–  137,508 

–  102,763 

–  95,400 

–  84,500 

–

–

–

–

–

–

17,566

20,137 991,830

– 1,629,444

–

–

–

26,517

14,489

16,934 75,429

– 107,016

– 30,374 66,525

9,457

–

77,301

– 441,988

– 372,409

– 395,665

– 603,353

– 338,781

–

–

–

–

61%

31%

40%

36%

42%

35%

–

–

–

–

61%

3%

20%

27%

11%

23%

*  The Director’s fees payable to P Landos are paid directly to Thorney Investment Group

Key management personnel equity holdings: 

Fully paid ordinary shares

Balance at the 
start of the 
year 
No.

Granted as 
Compensation 
No.

Received on 
Exercise of 
Options 
No.

Other1 
Movements 
No.

Balance at 
the end of the 
year 
No.

2022

Non-Executive Directors

D Allman

T Stianos

D McMaster

Executive Officers

J P Marcantonio

A Haidar2

M Nicholls2

D Romanelli3

4,500,000

600,000

 50,000

–

526,364

–

455,190

 –

 –

 –

 –

–

 –

 –

 –

 –

285,882

 157,325

106,981

314,896

–

–

–

–

4,500,000

600,000

50,000

285,882

 (683,689)

(106,981)

(770,086)

–

–

–

1   Includes shares traded on the stock market and other adjustments

2   The role is not considered as Key Management

3   Resigned 30 September 2021

DIRECTORS’ REPORT (continued)for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |23

Balance at the 
start of the 
year 
No.

Granted as 
Compensation 
No.

Received on 
Exercise of 
Options 
No.

Other1 
Movements 
No.

Balance at 
the end of the 
year 
No.

4,500,000

600,000

 50,000

516,364

263,000

 –

 –

 –

 –

 –

 –

 –

 –

 –

 –

–

–

–

4,500,000

600,000

50,000

10,000

192,190

526,364

455,190

2021

Non-Executive Directors

D Allman

T Stianos

D McMaster

Executive Officers

A Haidar

D Romanelli

Share based compensation
Each performance right entitles the holder to one ordinary share in the Company in the event that the performance 
rights are exercised. Performance rights carry no rights to dividends and no voting rights.

The performance rights granted on 16 January 2020 are subject to the continuation of employment to 
30 June 2022 and then the satisfying of relevant performance hurdles based on improvements in the Group’s 
diluted earnings per share over the three year period from 1 July 2020 to 30 June 2022. None of these rights can 
vest until the Company releases its FY22 annual report to the ASX (on or around 1st October 2022) and expire on 
1 December 2022.

The performance rights granted on 30 October 2020 to the senior executives are subject to the continuation of 
employment to 30 June 2023 and then the satisfying of relevant performance hurdles based on improvements 
in the Group’s diluted earnings per share over the three year period from 1 July 2020 to 30 June 2023. The 
performance rights granted on 23 December 2020 to the CEO and Managing Director are subject to employment 
conditions and satisfying of relevant performance hurdles based on TSR over the three year period from 1 July 2020 
to 30 June 2023. None of these rights can vest until the Company releases its FY23 annual report to the ASX (on or 
around 1st October 2023) and expire on 1 December 2023.

The performance rights granted on 23 December 2021 and 6 April 2022 are subject to the continuation of 
employment to 30 June 2024 and then the satisfying of relevant performance hurdles based on improvements in 
the Group’s diluted earnings per share over the three year period from 1 July 2021 to 30 June 2024. None of these 
rights can vest until the Company releases its FY24 annual report to the ASX (on or around 1st October 2024) and 
expire on 1 December 2024.

In addition to the time requirement of continuous 3 year employment, the diluted EPS needs to increase by greater 
than a CAGR of 3.0% and over the relevant 3-year performance period. The number of Rights vesting will be 
determined proportionately, on a straight-line basis, between CAGR of 3.0% and CAGR of 10.0%.

2022 ANNUAL REPORT | GALE PACIFIC |24

Key management personnel & other management equity holdings – compensation options and 
performance rights: 

Granted and vested during the year

Vested 
Number

Granted 
Number

Grant 
Date

2022

Non-Executive Directors

Executive Director

–

–

Executive Officers

– 2,173,000

23/12/21

Other Management

–

901,000

23/12/21

Total

2021

– 3,074,000

Non–Executive Directors

Executive Director

Executive Officers

14,000,000 23/12/20

– 1,504,000 30/10/20

Other Management

–

483,000 30/10/20

Total

– 15,987,000

Movements during the year

Value Per 
Option/
Right at 
Grant 
Date

Terms and Conditions for Each Grant

Exercise 
Price

Expiry 
Date

First 
Exercise 
Date

Last 
Exercise 
Date

0.31

0.30

0.18

0.16

0.16

Nil

Nil

Nil

Nil

Nil

01/12/24

01/10/24

01/10/24

01/12/24

01/10/24

01/10/24

01/12/23

01/10/23

01/10/23

01/12/23

01/10/23

01/10/23

01/12/23

01/10/23

01/10/23

Balance at 
the start 
of the 
year 
No.

Granted 
as Comp-
ensation 
No.

Net Other 
Change4 
No.

Balance at 
the end of 
the year 
No.

Balance 
Held 
Nominally 
No.

Value of 
Lapsed 
Options/
Rights 
$

Exercised 
No.

Lapsed 
No.

2022

Non-Executive Directors

None

–

–

–

–

–

–

Executive Officers

J P Marcantonio

14,318,000

–

(285,882)

(32,118)

T Mortleman

361,000

455,000

–

–

– 14,000,000

–

816,000

A Haidar2

Cliff Zhang1

M Nicholls2

S Smith

A Boccelli

K Harshaw

M Russell3

676,088

232,000

(157,325)

(17,675)

(733,088)

508,737

–

–

(508,737)

–

494,585

179,000

(106,981)

(12,019)

(554,585)

–

–

–

–

–

–

–

204,000

331,000

393,000

379,000

–

–

–

–

–

–

–

–

–

–

–

204,000

331,000

393,000

229,000

608,000

D Romanelli1

728,896

–

(314,896)

(414,000)

–

–

Other Management

Other 
Management

820,665

901,000

(136,648)

(15,352)

1,058,673 2,628,338

Total

17,907,971 3,074,000 (1,001,732)

(999,901)

– 18,980,338

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

DIRECTORS’ REPORT (continued)for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |25

Balance at 
the start 
of the 
year 
No.

Granted 
as Comp-
ensation 
No.

Net Other 
Change4 
No.

Balance at 
the end of 
the year 
No.

Balance 
Held 
Nominally 
No.

Value of 
Lapsed 
Options/
Rights 
$

Exercised 
No.

Lapsed 
No.

2021

Non-Executive Directors

None

–

–

Executive Officers

J P Marcantonio

588,000 14,000000

T Mortleman

–

361,000

A Haidar

Cliff Zhang

M Nicholls

535,088

285,000

386,737

226,000

389,585

218,000

D Romanelli

314,896

414,000

Other Management

Other 
Management

662,665

483,000

Total

2,876,971 15,987,000

1   Resigned 30 September 2021

–

–

–

–

–

–

–

–

–

–

(270,000)

– 14,318,000

–

(144,000)

(104,000)

(113,000)

–

–

–

–

–

–

361,000

676,088

508,737

494,585

728,896

–

(325,000)

– (956,000)

–

820,665

– 17,907,971

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

2   Effective 23 February 2022, the role is not considered as Key Management

3   Appointed 10 August 2021 (previously Chief Human Resources Officer)

4   Net Other Change represents the reclassification between KMP and other management

Employment and service agreements
Executives serve under terms and conditions contained 
in a standard executive employment agreement, 
that allows for termination under certain conditions 
with two to three months’ notice. The agreements 
include restraints of trade on the employee as well as 
confidentiality and intellectual property agreements.

Indemnity and insurance of officers
The Company has indemnified the directors and 
executives of the Company for costs incurred, in their 
capacity as a director or executive, for which they may 
be held personally liable, except where there is a lack of 
good faith.

During the financial year, the Company paid a premium 
in respect of a contract to insure the directors and 
executives of the Company against a liability to the 
extent permitted by the Corporations Act 2001. The 
contract of insurance prohibits disclosure of the nature 
of the liability and the amount of the premium.

Indemnity and insurance of auditor
The Company has not, during or since the end of the 
financial year, indemnified or agreed to indemnify the 
auditor of the Company or any related entity against a 
liability incurred by the auditor.

During the financial year, the Company has not paid a 
premium in respect of a contract to insure the auditor of 
the Company or any related entity. 

Proceedings on behalf of 
the company
No person has applied to the Court under section 
237 of the Corporations Act 2001 for leave to bring 
proceedings on behalf of the Company, or to intervene 
in any proceedings to which the Company is a party 
for the purpose of taking responsibility on behalf of the 
Company for all or part of those proceedings.

2022 ANNUAL REPORT | GALE PACIFIC |Rounding of amounts
The Company is of a kind referred to in Class Order 
2016/191, issued by the Australian Securities and 
Investments Commission, relating to ‘rounding off’. 
Amounts in this report have been rounded off in 
accordance with that Class Order to the nearest 
thousand dollars, or in certain cases, the nearest dollar.

Auditor’s independence declaration
A copy of the auditor’s independence declaration as 
required under section 307C of the Corporations Act 
2001 is set out immediately after this directors’ report.

Auditor
Deloitte Touche Tohmatsu continues in office in 
accordance with section 327 of the Corporations 
Act 2001.

This report is made in accordance with a resolution 
of Directors, pursuant to section 298(2)(a) of the 
Corporations Act 2001.

26

Non-audit services
Details of the amounts paid or payable to the auditor for 
non-audit services provided during the financial year by 
the auditor are outlined in note 32 to the consolidated 
financial statements.

The directors are satisfied that the provision of non-
audit services during the financial year, by the auditor 
(or by another person or firm on the auditor’s behalf), is 
compatible with the general standard of independence 
for auditors imposed by the Corporations Act 2001.

The directors are of the opinion that the services as 
disclosed in note 32 to the consolidated financial 
statements do not compromise the external auditor’s 
independence requirements of the Corporations Act 
2001 for the following reasons:

 ■ all non-audit services have been reviewed and 
approved to ensure that they do not impact the 
integrity and objectivity of the auditor; and

 ■ none of the services undermine the general 

principles relating to auditor independence as set 
out in APES 110 Code of Ethics for Professional 
Accountants issued by the Accounting Professional 
and Ethical Standards Board, including reviewing 
or auditing the auditor’s own work, acting in a 
management or decision-making capacity for the 
Company, acting as advocate for the Company or 
jointly sharing economic risks and rewards.

Officers of the Company who are 
former partners of Deloitte Touche 
Tohmatsu
There are no officers of the Company who are former 
partners of Deloitte Touche Tohmatsu.

DIRECTORS’ REPORT (continued)for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |27

Deloitte Touche Tohmatsu 
ABN 74 490 121 060 
477 Collins Street 
Melbourne, VIC, 3000 
Australia 

Phone: +61 3 9671 7000  
www.deloitte.com.au 

23 August 2022 

The Board of Directors 
Gale Pacific Limited 
145 Woodlands Drive 
Braeside VIC 3195 

Dear Board Members 

GGaallee  PPaacciiffiicc  LLiimmiitteedd  

In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following 
declaration of independence to the directors of Gale Pacific Limited. 

As lead audit partner for the audit of the financial statements of Gale Pacific Limited for the financial 
year ended 30 June 2022, I declare that to the best of my knowledge and belief, there have been no 
contraventions of: 

(i) 

(ii) 

the auditor independence requirements of the Corporations Act 2001 in relation to the audit; 
and 

any applicable code of professional conduct in relation to the audit.   

Yours sincerely 

DELOITTE TOUCHE TOHMATSU 

Paul Schneider 
Partner  
Chartered Accountants 

Liability limited by a scheme approved under Professional Standards Legislation. 
Member of Deloitte Asia Pacific Limited and the Deloitte organisation. 

AUDITOR’S INDEPENDENCE DECLARATIONfor the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC | 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
28

Deloitte Touche Tohmatsu 
ABN 74 490 121 060 
477 Collins Street 
Melbourne, VIC, 3000 
Australia 

Phone: +61 3 9671 7000  
www.deloitte.com.au 

IInnddeeppeennddeenntt  AAuuddiittoorr’’ss  RReeppoorrtt  ttoo  tthhee  MMeemmbbeerrss  ooff  GGaallee  PPaacciiffiicc  LLiimmiitteedd  

RReeppoorrtt  oonn  tthhee  AAuuddiitt  ooff  tthhee  FFiinnaanncciiaall  RReeppoorrtt  

Opinion 

We have audited the financial report of Gale Pacific Limited (the “Company”) and its subsidiaries (the “Group”) 
which comprises the consolidated statement of financial position as at 30 June 2022, the consolidated 
statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and 
the  consolidated  statement  of  cash  flows  for  the  year  then  ended,  and  notes  to  the  consolidated  financial 
statements, including a summary of significant accounting policies and other explanatory information, and the 
directors’ declaration. 

In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, 
including: 

• 

• 

Giving  a  true  and  fair  view  of  the  Group’s  financial  position  as  at  30  June  2022  and  of  its   financial 
performance for the year then ended; and  

Complying with Australian Accounting Standards and the Corporations Regulations 2001. 

Basis for Opinion 

We  conducted  our  audit  in  accordance  with  Australian  Auditing  Standards.  Our  responsibilities  under  those 
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our 
report.  We  are  independent  of  the  Group  in  accordance  with  the  auditor  independence  requirements  of  the 
Corporations Act 2001 and the ethical requirements of the Accounting Professional & Ethical Standards Board’s 
APES 110 Code of Ethics for Professional Accountants (including  Independence Standards) (the  Code)  that are 
relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in 
accordance with the Code. 

We confirm that the independence declaration required by the Corporations Act 2001, which has been given to 
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s 
report. 

We  believe  that  the  audit  evidence  we  have  obtained  is  sufficient  and  appropriate  to  provide  a  basis  for  our 
opinion. 

Key Audit Matters  

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of 
the  financial  report  for  the  current  period.  These  matters  were  addressed  in  the  context  of  our  audit  of  the 
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on 
these matters.  

Liability limited by a scheme approved under Professional Standards Legislation. 
Member of Deloitte Asia Pacific Limited and the Deloitte organisation. 

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF GALE PACIFIC LIMITEDfor the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC | 
 
 
 
 
  
 
 
 
 
 
29

KKeeyy  AAuuddiitt  MMaatttteerr  

HHooww  tthhee  ssccooppee  ooff  oouurr  aauuddiitt  rreessppoonnddeedd  ttoo  tthhee  KKeeyy  AAuuddiitt  MMaatttteerr  

RReeccoovveerraabbiilliittyy   ooff   ttrraaddee   rreecceeiivvaabblleess  
MMiiddddllee  EEaasstt  aanndd  NNoorrtthh  AAffrriiccaa  

iinn  

Our procedures included, but were not limited to: 

Refer to Note 10 Current assets – trade and 
other receivables. 

• 

 As at 30 June 2022, the carrying amounts 
of Middle East and North Africa (“MENA”) 
trade  receivables  totalled  AU$8.27  million 
with  AU$1.88  million  of  the  outstanding 
balance aged over 365 days.   The balance 
of the expected credit loss allowance over 
in  MENA 
receivables 
impairment  of 
accounts 
trade 
for  $1.74  million  of 
receivables greater than 365 days.  

 The  allowance  determination  as 
to 
whether  the  receivables  are  collectable 
level  of  management 
requires  a  high 
judgment 
estimates,  whereby 
and 
management  considers  specific  factors 
including the age of the balances, historical 
payment  patterns  and  any  other  relevant 
information 
the 
creditworthiness of the counterparties. 

concerning 

• 

• 

• 

Obtaining  an  understanding  of  how  the  allowance  for 
impairment  of  MENA  receivables 
is  estimated  by 
management  and  assessing  management’s  process  in 
determining  the  estimated  future  cash  flows  of  MENA 
receivables; 

Evaluating  on  a  sample  basis,  the  aging  analysis  and 
subsequent  settlement  of  the  MENA  receivables  to  the 
source documents including invoices and bank statements; 

Assessing the reasonableness of allowance for impairment 
of  MENA  receivables  with  reference  to  the  credit  history 
including default or delay in payments, settlement records, 
subsequent  settlements  and  aging  analysis  of  the  MENA 
receivables; and 

Evaluating  the  historical  accuracy  of  management’s 
assessment  of  allowance  for  MENA  receivables  by 
assessing  the  actual  write-offs,  the  reversal  of  previous 
recorded allowances and new allowances recorded in the 
current year in respect of MENA receivables. 

We also assessed the appropriateness of disclosures included in 
Note 10 of the financial report relating to accounts receivables. 

Other Information  

The directors are responsible for the other information. The other information comprises the information included 
in the Group’s annual report for the year ended 30 June 2022 but does not include the financial report and our 
auditor’s report thereon.  

Our  opinion  on  the  financial  report  does  not  cover  the  other  information  and  we  do  not  express  any  form  of 
assurance conclusion thereon.  

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing 
so, consider whether the other information is materially inconsistent with the financial report or our knowledge 
obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, 
we conclude that there is a material misstatement of this other information, we are required to report that fact. 
We have nothing to report in this regard. 

Responsibilities of the Directors for the Financial Report 

The directors of the Company are responsible for the preparation of the financial report that gives a true and fair 
view in accordance with Australian Accounting Standards and the  Corporations Act 2001 and for such internal 
control as the directors determine is necessary to enable the preparation of the financial report that gives a true 
and fair view and is free from material misstatement, whether due to fraud or error. 

In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue as 
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of 
accounting unless the directors either intend to liquidate the Group or to cease operations, or has no realistic 
alternative but to do so.  

2022 ANNUAL REPORT | GALE PACIFIC | 
  
  
  
 
30

Auditor’s Responsibilities for the Audit of the Financial Report  

Our objectives are to  obtain  reasonable assurance about  whether the financial report  as a  whole  is free from 
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. 
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance 
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements 
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably 
be expected to influence the economic decisions of users taken on the basis of this financial report. 

As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and 
maintain professional scepticism throughout the audit. We also: 

• 

• 

• 

• 

• 

• 

Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, 
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient 
and  appropriate  to  provide  a  basis  for  our  opinion.  The  risk  of  not  detecting  a  material  misstatement 
resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, 
intentional omissions, misrepresentations, or the override of internal control. 

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that 
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness 
of the Group’s internal control.  

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates 
and related disclosures made by the directors.  

Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based 
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that 
may cast significant doubt on the Group’s  ability  to continue as a going  concern. If we  conclude that a 
material  uncertainty  exists,  we  are  required  to  draw  attention  in  our  auditor’s  report  to  the  related 
disclosures  in  the  financial  report  or,  if  such  disclosures  are  inadequate,  to  modify  our  opinion.  Our 
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, 
future events or conditions may cause the Group to cease to continue as a going concern.  

Evaluate the overall presentation, structure and content of the financial report, including the disclosures, 
and  whether  the  financial  report  represents  the  underlying  transactions  and  events  in  a  manner  that 
achieves fair presentation.  

Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business 
activities  within  the  Group  to  express  an  opinion  on  the  financial  report.  We  are  responsible  for  the 
direction, supervision and performance of the Group’s audit. We remain solely responsible for our audit 
opinion. 

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit 
and significant audit findings, including any significant deficiencies in internal control that we identify during our 
audit.  

We  also  provide  the  directors  with  a  statement  that  we  have  complied  with  relevant  ethical  requirements 
regarding independence, and to communicate with them all relationships and other matters that may reasonably 
be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards 
applied.  

From the matters communicated with the directors, we determine those matters that were of most significance 
in the audit of the financial report of the current period and are therefore the key audit matters. We describe 
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or 
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report 
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest 
benefits of such communication. 

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF GALE PACIFIC LIMITED (continued)for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC | 
31

RReeppoorrtt  oonn  tthhee  RReemmuunneerraattiioonn  RReeppoorrtt  

Opinion on the Remuneration Report 

We have audited the Remuneration Report included in pages 18 to 25 of the Directors’ Report for the year ended 
30 June 2022.  

In our opinion, the Remuneration Report of Gale Pacific Limited, for the year ended 30 June 2022, complies with 
section 300A of the Corporations Act 2001.  

Responsibilities  

The directors of the Company are responsible for the preparation and presentation of the Remuneration Report 
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the 
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.  

DELOITTE TOUCHE TOHMATSU 

Paul Schneider  
Partner 
Chartered Accountants 
Melbourne, 23 August 2022 

2022 ANNUAL REPORT | GALE PACIFIC | 
 
 
 
 
 
 
32

In the opinion of the Directors of Gale Pacific Limited (the Company):

 ■ the attached consolidated financial statements and notes comply with the Corporations Act 2001, the 

Australian Accounting Standards, the Corporations Regulations 2001 and other mandatory professional 
reporting requirements;

 ■ the attached consolidated financial statements and notes (page 33 to 71) comply with Australian Financial 

Reporting Standards as issued by the Australian Accounting Standards Board as described in note 2 to the 
financial statements;

 ■  the attached consolidated financial statements and notes give a true and fair view of the Group’s financial 

position as at 30 June 2022 and of its performance for the financial year ended on that date; and

 ■ there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become 

due and payable.

The directors have been given the declarations required by section 295A of the Corporations Act 2001.

Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001.

On behalf of the directors

David Allman 
Chairman 

23 August 2022   
Melbourne 

John Paul Marcantonio
Chief Executive Officer and Managing Director

DIRECTORS’ DECLARATIONfor the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC | 
 
33

Revenue

Sale of goods

Other income

Expenses

Raw materials and consumables used

Employee benefits expense

Depreciation and amortisation expense

Marketing and advertising

Occupancy costs

Warehouse and related costs

Other expenses

Finance costs

Profit before income tax expense

Income tax expense

Profit after income tax expense for the year attributable to the owners 
of Gale Pacific Limited

Other comprehensive income

Items that may be reclassified subsequently to profit or loss

Net change in the fair value of cash flow hedges taken to equity,  
net of tax

Foreign currency translation

Other comprehensive income for the year, net of tax

Total comprehensive income for the year attributable to the owners of 
Gale Pacific Limited

Basic earnings per share

Diluted earnings per share

Consolidated

Note

2022 
$’000

2021 
$’000

5

6

6

6

6

7

205,543

205,223 

1,079

1,935

(109,632)

(107,520)

(41,284)

(40,254)

(9,970)

(3,188)

(2,510)

(13,446)

(13,636)

(2,004)

10,952

(3,335)

(9,198)

(1,949)

(2,679)

(13,326)

(13,215)

(1,797)

17,220

(4,893)

7,617

12,327

 22 

22

 8 

8

317

4,396

4,713

12,330

Cents

2.76

2.59

263

(1,210)

(947)

11,380

Cents

4.48

4.21

The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction 
with the accompanying notes.

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOMEfor the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC | 
 
34

Assets

Current assets

Cash and cash equivalents

Trade and other receivables

Inventories

Derivative financial instrument – hedges

Prepayments

Total current assets

Non-current assets

Property, plant and equipment

Intangibles

Right-of-use assets

Deferred tax

Total non-current assets

Total assets

Liabilities

Current liabilities

Trade and other payables

Borrowings

Lease liabilities

Derivative financial instrument – hedges

Current tax liabilities

Employee benefits

Provisions

Total current liabilities

Non-current liabilities

Borrowings

Lease liabilities

Deferred tax

Employee benefits

Total non-current liabilities

Total liabilities

Net assets

Equity

Issued capital

Reserves

Retained profits

Total equity

Consolidated

Note

2022 
$’000

2021 
$’000

9

10

11

26

12

13

14

7

 15 

 16 

18

26

7

 17 

 19 

 20 

 7 

 21 

22

28,465 

47,295 

56,299 

– 

3,126 

30,407 

41,471 

46,547 

515 

3,421 

135,185 

122,361 

30,845 

30,705 

8,794 

26,415 

8,998 

8,142 

20,314 

6,889 

75,052 

66,050 

210,237

188,411

30,692 

21,059 

4,677 

1,355 

3,053 

5,548 

507 

29,507 

19,364 

3,764 

– 

1,156 

6,174 

501 

66,891 

60,466 

12,935 

24,111 

8,112 

212 

9,575 

18,579 

6,702 

170 

45,370 

35,026 

112,261

97,976

95,492

92,919

63,403 

10,335 

24,238 

97,976

63,068 

4,459 

25,392 

92,919

The above consolidated statement of financial position should be read in conjunction with the accompanying notes.

CONSOLIDATED STATEMENT OF  FINANCIAL POSITIONas at 30 June 20222022 ANNUAL REPORT | GALE PACIFIC | 
35

Consolidated

Balance at 1 July 2020

Profit after income tax expense for the year

Other comprehensive income for the year, net of tax

Total comprehensive income for the year

Transactions with owners in their capacity as owners:

Share-based payments (note 31)

Transfer to Enterprise Reserve Fund

Dividends paid (note 23)

Balance at 30 June 2021

Consolidated

Balance at 1 July 2021

Profit after income tax expense for the year

Other comprehensive income for the year, net of tax

Total comprehensive income for the year

Transactions with owners in their capacity as owners:

Share-based payments (note 31)

Vesting of performance rights (note 31)

Transfer to Enterprise Reserve Fund

Dividends paid (note 23)

Balance at 30 June 2022

Issued  
Capital 
$’000

Reserves 
(Note 22) 
$’000

Retained 
Profits 
$’000

63,068

3,992

–

–

–

–

–

–

–

(947)

(947)

1,435

(21)

–

63,068

4,459

21,306

12,327

–

–

–

21

(8,262)

25,392

Issued  
Capital 
$’000

Reserves 
(Note 22) 
$’000

Retained 
Profits 
$’000

Total 
equity 
$’000

88,366

12,327

(947)

(947)

1,435

–

(8,262)

92,919

Total 
equity 
$’000

63,068

4,459

25,392

92,919

–

–

–

–

335

–

–

–

4,713

4,713

999

(335)

499

–

63,403

10,335

7,617

–

7,617

–

–

(499)

(8,272)

24,328

7,617

4,713

12,330

999

–

–

(8,272)

97,976

The above consolidated statement of changes in equity should be read in conjunction with the 
accompanying notes.

CONSOLIDATED STATEMENT OF  CHANGES IN EQUITYfor the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |36

Cash flows from operating activities

Profit before income tax expense for the year

Adjustments for:

Depreciation and amortisation

Share-based payments

Foreign currency gain

Interest and other finance costs

Change in operating assets and liabilities:

Increase in trade and other receivables

Decrease/(increase) in inventories

Decrease/(increase) in derivative assets

Decrease/(increase) in prepayments

Increase in trade and other payables

Increase/(decrease) in derivative liabilities

Increase/(decrease) in employee benefits

Increase in other provisions

Interest and other finance costs paid

Income taxes paid

Net cash from operating activities

Cash flows from investing activities

Payments for property, plant and equipment

Payments for intangibles

Proceeds from disposal of property, plant and equipment

Net cash used in investing activities

Cash flows from financing activities

Proceeds/(repayment) of leases

Dividends paid

Proceeds/(repayment) of borrowings

Net cash used in financing activities

Net increase/(decrease) in cash and cash equivalents

Cash and cash equivalents at the beginning of the financial year

Effects of exchange rate changes on cash and cash equivalents

Consolidated

Note

2022 
$’000

2021 
$’000

10,952 

17,220 

9,970 

999 

(63)

2,004 

23,862

(5,824)

(9,752)

514

295 

1,185 

1,673 

(584)

8 

11,377

(2,004)

(2,137)

7,236

9,198 

1,435 

1,461 

1,797 

31,111

(1,868)

2,152 

(515)

(1,200)

6,363 

(333)

1,960 

357 

38,027

(1,797)

(1,612)

34,618

12

13

18, 20

23

19

(3,960)

(3,002)

(889)

122 

(4,727)

(2,943)

(8,272)

5,059 

(6,156)

(3,647)

30,407 

1,705 

(855)

96 

(3,761)

(4,182)

(8,262)

(14,159)

(26,603)

4,254 

27,811 

(1,658)

Cash and cash equivalents at the end of the financial year

9

28,465

30,407

The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.

CONSOLIDATED STATEMENT OF CASH FLOWSfor the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |37

Note 1. General information
The consolidated financial report covers Gale Pacific 
Limited (‘Company’ or ‘parent entity’) and its controlled 
entities (together the ‘Group’). The consolidated 
financial statements are presented in Australian 
dollars, which is Gale Pacific Limited’s functional and 
presentation currency.

Gale Pacific Limited is a listed public company limited 
by shares, incorporated and domiciled in Australia. Its 
registered office and principal place of business is:

145 Woodlands Drive 
Braeside, VIC 3195 
Australia 

A description of the nature of the Group’s operations is 
included in the directors’ report, which is not part of the 
financial statements.

The Group’s principal activities are the marketing, 
sales, manufacture and distribution of branded 
screening, architectural shading, commercial agricultural 
/ horticultural fabric products to domestic and 
global markets.

The financial statements were authorised for issue, 
in accordance with a resolution of directors, on 
23 August 2022. The directors have the power to 
amend and reissue the financial statements.

Statement of Compliance
These financial statements are general purpose 
financial statements which have been prepared in 
accordance with the Corporations Act 2001, Accounting 
Standards and Interpretations, and comply with other 
requirements of the law. The financial statements 
comprise the consolidated financial statements of 
the Group. 

For the purposes of preparing the consolidated financial 
statements, the Company is a for-profit entity.

Accounting Standards include Australian Accounting 
Standards. Compliance with Australian Accounting 
Standards ensures that the financial statements and 
notes of the company and the Group comply with 
International Financial Reporting Standards (‘IFRS’).

Basis of preparation
The consolidated financial statements have been 
prepared on the basis of historical cost, except for 
certain financial instruments that are measured at 
revalued amounts or fair values at the end of each 

reporting period, as explained in the accounting 
policies below.

Historical cost is generally based on the fair values 
of the consideration given in exchange for goods 
and services. All amounts are presented in Australian 
dollars, unless otherwise noted.

Note 2. Significant accounting 
policies
The principal accounting policies adopted in the 
preparation of the consolidated financial statements are 
set out either in the respective notes or below. These 
policies have been consistently applied to all the years 
presented, unless otherwise stated.

New or amended Accounting Standards and 
Interpretations adopted
The Group has adopted all of the new, revised or 
amending Accounting Standards and Interpretations 
issued by the Australian Accounting Standards 
Board (‘AASB’) that are mandatory for the current 
reporting period. 

New and revised Standards and amendments thereof 
and Interpretations effective for the current year that are 
relevant to the Group include: 

AASB 2020-8 Amendments to Australian 
Accounting Standards – Interest Rate 
Benchmark Reform
In September 2020, the AASB made amendments 
to AASB 9 Financial Instruments, AASB 139 Financial 
Instruments: Recognition and Measurement, AASB 7 
Financial Instruments: Disclosures, AASB 4 Insurance 
Contracts and AASB 16 Leases to address issues that 
arise during the reform of an interest rate benchmark 
(IBOR), including the replacement of one benchmark 
with an alternative one.

The Group has assessed the impact of AASB 2020-8 
Amendments and determined there is no impact to the 
financial statements. 

AASB 2021-3 Amendments to Australian 
Accounting Standards – Covid-19-related rent 
concessions beyond 30 June 2021
As a result of the coronavirus (COVID-19) pandemic, rent 
concessions have been granted to lessees. The AASB 
made an amendment that provides an optional practical 
expedient where lessees benefiting from these rent 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC | 
 
 
38

Note 2. Significant accounting policies (continued)

concessions may account for them as variable lease 
payments in the periods in which they are granted.

The Group has assessed the impact of AASB 2021-3 
Amendments and determined there is no impact to the 
financial statements. 

unless the transaction provides evidence of the 
impairment of the asset transferred. Accounting policies 
of subsidiaries have been changed where necessary 
to ensure consistency with the policies adopted by 
the Group.

AASB 2020-3 Amendments to Australian 
Accounting Standards – Annual improvements 
2018-2020 and other amendments
The AASB has made narrow scope amendments to 

 ■ AASB 116 Property, Plant and Equipment in relation 

to proceeds before intended use 

 ■ AASB 137 Provisions, Contingent Liabilities and 

Contingent Assets in relation to onerous contracts 
and the cost of fulfilling a contract 

 ■ AASB 3 Business combinations in relation to 

references to the Conceptual Framework, and 
annual improvements to AASB 16, AASB 1, AASB 9 
and AASB 141.

The Group has assessed the impact of AASB 2020-3 
Amendments and determined there is no impact to the 
financial statements.

Comparatives

Where necessary, the comparative statement of profit 
or loss and other comprehensive income has been 
reclassified and repositioned for consistency with the 
current period disclosures.

Principles of consolidation

The consolidated financial statements incorporate the 
assets and liabilities of all subsidiaries of Gale Pacific 
Limited as at 30 June 2022 and the results of all 
subsidiaries for the year then ended. 

Subsidiaries are all those entities over which the 
Company has control. The Company controls an entity 
when the Group is exposed to, or has rights to, variable 
returns from its involvement with the entity and has the 
ability to affect those returns through its power to direct 
the activities of the entity. Subsidiaries are consolidated 
from the date on which control is transferred to the 
Company. They are de-consolidated from the date that 
control ceases.

Intercompany transactions, balances and unrealised 
gains on transactions between entities in the Group 
are eliminated. Unrealised losses are also eliminated 

The acquisition of subsidiaries is accounted for using 
the acquisition method of accounting. A change in 
ownership interest, without the loss of control, is 
accounted for as an equity transaction, where the 
difference between the consideration transferred and 
the book value of the share of the non-controlling 
interest acquired is recognised directly in equity 
attributable to the parent.

Where the Group loses control over a subsidiary, it 
derecognises the assets including goodwill, liabilities 
and non-controlling interest in the subsidiary together 
with any cumulative translation differences recognised 
in equity. The Group recognises the fair value of 
the consideration received and the fair value of any 
investment retained together with any gain or loss in 
profit or loss.

Foreign currencies and translations 

Foreign currency transactions

Foreign currency transactions are translated into the 
entity’s functional currency using the exchange rates 
prevailing at the dates of the transactions. Foreign 
exchange gains and losses resulting from the settlement 
of such transactions and from the translation at 
financial year-end exchange rates of monetary assets 
and liabilities denominated in foreign currencies are 
recognised in profit or loss.

Foreign operations

The assets and liabilities of foreign operations are 
translated into Australian dollars using the exchange 
rates at the reporting date. The revenues and expenses 
of foreign operations are translated into Australian 
dollars using the average exchange rates, which 
approximate the rates at the dates of the transactions, 
for the period. All resulting foreign exchange differences 
are recognised in other comprehensive income through 
the foreign currency reserve in equity.

On the disposal of a foreign operation (i.e. a disposal of 
the Group’s entire interest in a foreign operation, or a 
disposal involving loss of control over a subsidiary that 
includes a foreign operation, loss of joint control over a 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |39

jointly controlled entity that includes a foreign operation, 
or loss of significant influence over an associate that 
includes a foreign operation), the cumulative amount 
in the foreign currency translation reserve in respect of 
that operation is then recognised in profit or loss.

Monetary items forming net investment in 
foreign operations

The Group classifies monetary items of a non-current 
nature where settlement is not planned in the 
foreseeable future as part of the net investment in 
foreign operations. All foreign exchange differences 
on these items are recognised in other comprehensive 
income through the foreign currency reserve in equity. 
As and when settlements occur, the cumulative amount 
in the foreign currency translation reserve is then 
recognised in profit or loss.

Revenue recognition
The Group recognises revenue as follows:

Sale of goods

Revenue is recognised at an amount that reflects the 
consideration to which the Group is expected to be 
entitled in exchange for transferring goods or services 
to a customer. For each contract with a customer, the 
Group: identifies the contract with a customer; identifies 
the performance obligations in the contract; determines 
the transaction price which takes into account 
estimates of variable consideration and the time 
value of money; allocates the transaction price to the 
separate performance obligations on the basis of the 
relative stand-alone selling price of each distinct good 
or service to be delivered; and recognises revenue 
when or as each performance obligation is satisfied in a 
manner that depicts the transfer to the customer of the 
goods or services promised.

Variable consideration within the transaction price, if 
any, reflects concessions provided to the customer 
such as discounts, rebates and refunds, any potential 
bonuses receivable from the customer and any other 
contingent events. Such estimates are determined 
using either the ‘expected value’ or ‘most likely amount’ 
method. The measurement of variable consideration 
is subject to a constraining principle whereby revenue 
will only be recognised to the extent that it is highly 
probable that a significant reversal in the amount 
of cumulative revenue recognised will not occur. 
The measurement constraint continues until the 
uncertainty associated with the variable consideration 

is subsequently resolved. Amounts received that are 
subject to the constraining principle are recognised as a 
refund liability.

Revenue from the sale of goods is recognised at 
the point in time when the performance obligation is 
satisfied and customer obtains control of the goods, 
which is generally at the time of delivery.

Other income

Other income is recognised when it is received or when 
the right to receive payment is established.

Current and non-current classification
Assets and liabilities are presented in the statement 
of financial position based on current and non-current 
classification.

An asset is classified as current when: it is either 
expected to be realised or intended to be sold or 
consumed in the Group’s normal operating cycle; it is 
held primarily for the purpose of trading; it is expected 
to be realised within 12 months after the reporting 
period; or the asset is cash or cash equivalent unless 
restricted from being exchanged or used to settle a 
liability for at least 12 months after the reporting period. 
All other assets are classified as non-current.

A liability is classified as current when: it is either 
expected to be settled in the Group’s normal operating 
cycle; it is held primarily for the purpose of trading; it is 
due to be settled within 12 months after the reporting 
period; or there is no unconditional right to defer the 
settlement of the liability for at least 12 months after the 
reporting period. All other liabilities are classified as 
non-current.

Deferred tax assets and liabilities are always classified 
as non-current.

Derivative financial instruments
Derivatives are initially recognised at fair value on 
the date a derivative contract is entered into and are 
subsequently remeasured to their fair value at each 
reporting date. The accounting for subsequent changes 
in fair value depends on whether the derivative is 
designated as a hedging instrument, and if so, the 
nature of the item being hedged.

Derivatives are classified as current or non-current 
depending on the expected period of realisation.

2022 ANNUAL REPORT | GALE PACIFIC |40

Note 2. Significant accounting policies (continued)

Cash flow hedges

Cash flow hedges are used to cover the Group’s 
exposure to variability in cash flows that is attributable 
to particular risks associated with a recognised asset 
or liability or a firm commitment which could affect 
profit or loss. The effective portion of the gain or loss 
on the hedging instrument is recognised in other 
comprehensive income through the cash flow hedges 
reserve in equity, whilst the ineffective portion is 
recognised in profit or loss. Amounts taken to equity 
are transferred out of equity and included in the 
measurement of the hedged transaction when the 
forecast transaction occurs.

Cash flow hedges are tested for effectiveness on a 
regular basis both retrospectively and prospectively 
to ensure that each hedge is highly effective and 
continues to be designated as a cash flow hedge. If the 
forecast transaction is no longer expected to occur, the 
amounts recognised in equity are transferred to profit 
or loss.

If the hedging instrument is sold, terminated, 
expires, exercised without replacement or rollover, 
or if the hedge becomes ineffective and is no 
longer a designated hedge, the amounts previously 
recognised in equity remain in equity until the forecast 
transaction occurs.

Impairment of assets
Goodwill, other intangible assets that have an indefinite 
useful life, and assets not yet ready for use as intended 
by management, are not subject to amortisation and 
are tested annually for impairment, or more frequently 
if events or changes in circumstances indicate that 
they might be impaired. Other non-financial assets 
are reviewed for impairment whenever events or 
changes in circumstances indicate that the carrying 
amount may not be recoverable. An impairment loss is 
recognised for the amount by which the asset’s carrying 
amount exceeds its recoverable amount. Where the 
asset does not generate independent cash flows, the 
Group estimates the recoverable amount of the cash 
generating unit (‘CGU’) to which the asset belongs.

Recoverable amount is the higher of fair value less cost 
of disposal and value-in-use. In assessing value-in-use, 
the estimated future cash flows are discounted to their 
present value using a 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. In assessing 
fair value less cost of disposal, recognised valuation 
methodologies are applied, utilising current and forecast 
financial information as appropriate, benchmarked 
against relevant market data. The Group primarily 
uses the value-in-use methodology to estimate the 
recoverable amount for impairment testing purposes.

Employee benefits

Short-term employee benefits

Liabilities for wages and salaries, including 
non-monetary benefits, annual leave and long service 
leave expected to be settled wholly within 12 months of 
the reporting date is measured at the amounts expected 
to be paid when the liabilities are settled.

Long-term employee benefits

The liability for annual leave and long service leave not 
expected to be settled within 12 months of the reporting 
date are measured as the present value of expected 
future payments to be made in respect of services 
provided by employees up to the reporting date using 
the projected unit credit method. Consideration is given 
to expected future wage and salary levels, experience 
of employee departures and periods of service. 
Expected future payments are discounted using market 
yields at the reporting date on corporate bonds with 
terms to maturity and currency that match, as closely as 
possible, the estimated future cash outflows.

Defined contribution superannuation expense

Contributions to defined contribution superannuation 
plans are expensed in the period in which they 
are incurred.

Rounding of amounts
The Company is of a kind referred to in ASIC 
Corporations (Rounding in Financial/Directors’ Reports) 
Instrument 2016/191, issued by the Australian Securities 
and Investments Commission, relating to ‘rounding-off’. 
Amounts in this report have been rounded off in 
accordance with that Instrument to the nearest 
thousand dollars, or in certain cases, the nearest dollar.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |41

Note 3. Critical accounting 
judgements, estimates and 
assumptions
The preparation of the financial statements requires 
management to make judgements, estimates and 
assumptions that affect the reported amounts in the 
financial statements. Management continually evaluates 
its judgements and estimates in relation to assets, 
liabilities, contingent liabilities, revenue and expenses. 
Management bases its judgements, estimates and 
assumptions on historical experience and on other 
various factors, including expectations of future 
events, management believes to be reasonable under 
the circumstances. There are no critical accounting 
judgements, estimates and assumptions that are likely 
to affect the current or future financial years.

The preparation of the consolidated financial statements 
requires management to make judgements, estimates 
and assumptions that affect the reported amounts 
in the financial statements. Management continually 
evaluates its judgements and estimates in relation 
to assets, liabilities, contingent liabilities, revenue 
and expenses. Management bases its judgements, 
estimates and assumptions on historical experience 
and on other various factors, including expectations of 
future events, management believes to be reasonable 
under the circumstances. The resulting accounting 
judgements and estimates will seldom equal the 
related actual results. The judgements, estimates and 
assumptions that have a significant risk of causing a 
material adjustment to the carrying amounts of assets 
and liabilities (refer to the respective notes) within the 
next financial year are discussed below.

Share-based payment transactions

The Group measures the cost of equity-settled 
transactions with employees by reference to the fair 
value of the equity instruments at the date at which 
they are granted. The fair value is determined by 
using a combination of Monte Carlo simulation model 
and Dividend Discount model taking into account 
the terms and conditions upon which the instruments 
were granted, expected volatility, expected dividend 
yield and risk-free rate assumptions. The accounting 
estimates and assumptions relating to equity-settled 
share-based payments would have no impact on the 
carrying amounts of assets and liabilities within the next 

annual reporting period but may impact profit or loss 
and equity.

Allowance for expected credit losses

The allowance for expected credit losses assessment 
requires a degree of estimation and judgement. It is 
based on the lifetime expected credit loss, grouped 
based on days overdue, and makes assumptions 
to allocate an overall expected credit loss rate for 
each group. These assumptions include recent sales 
experience and historical collection rates.

Provision for impairment of inventories

The provision for impairment of inventories assessment 
requires a degree of estimation and judgement. The 
level of the provision is assessed by taking into account 
the recent sales experience, the ageing of inventories 
and other factors that affect inventory obsolescence.

Goodwill

The Group tests annually, or more frequently if events 
or changes in circumstances indicate impairment, 
whether goodwill has suffered any impairment, in 
accordance with the accounting policy stated in note 2. 
The recoverable amounts of cash-generating units have 
been determined based on value-in-use calculations. 
These calculations require the use of assumptions, 
including estimated discount rates based on the current 
cost of capital and growth rates of the estimated future 
cash flows.

Income tax

The Group is subject to income taxes in the jurisdictions 
in which it operates. Significant judgement is required 
in determining the provision for income tax. There are 
many transactions and calculations undertaken during 
the ordinary course of business for which the ultimate 
tax determination is uncertain. Where the final tax 
outcome of these matters is different from the carrying 
amounts, such differences will impact the current and 
deferred tax provisions in the period in which such 
determination is made.

Recovery of deferred tax assets

Deferred tax assets are recognised for deductible 
temporary differences and tax losses only if the Group 
considers it is probable that future taxable amounts 
will be available to utilise those temporary differences 
and losses.

2022 ANNUAL REPORT | GALE PACIFIC |42

Note 3. Critical accounting judgements, estimates and 
assumptions (continued)

Cash flow hedges

Forward foreign exchange contracts, designated as 
cash flow hedges, are measured at fair value. Reliance 
is placed on future cash flows and judgement is 
made on a regular basis, through prospective and 
retrospective testing, including at the reporting date, 
that the hedges are still highly effective.

Fair value hedges

Forward foreign exchange contracts, designated as fair 
value hedges, are measured as such. Changes in the 
fair value of derivatives that are designated and qualify 
as fair value hedges are recognised in profit or loss 
immediately, together with any changes in the fair value 
of the hedged asset or liability that are attributable to 
the hedged risk. 

Hedge accounting is discontinued when the Group 
revokes the hedging relationship, when the hedging 
instrument expires or is sold, terminated, or exercised, 
or when it no longer qualifies for hedge accounting. 
The fair value adjustment to the carrying amount of the 
hedged item arising from the hedged risk is amortised 
to profit or loss from that date.

Note 4. Operating segments

Identification of reportable operating segments

The Group is organised into four operating segments 
identified by geographic location, together with 
Corporate. These operating segments are based 
on the internal reports that are reviewed and used 
by the Group Managing Director (who is identified 
as the Chief Operating Decision Maker (‘CODM’)) 
in assessing performance and in determining the 
allocation of resources. There is no aggregation of 
operating segments.

The Group operates predominantly in one market 
segment, being branded shading, screening and home 
improvement products. 

The CODM reviews revenue and segment earnings, 
before interest, tax, depreciation and amortisation 
(‘EBITDA’). The accounting policies adopted for internal 
reporting to the CODM are consistent with those 
adopted in the financial statements.

Discrete financial information about each of these 
segments is reported on a monthly basis.

To continuously improve the transparency of the 
Group’s management reporting GALE Pacific Limited 
follows an activity-based allocation method of 
reporting. Intersegment sales/margin and central 
costs are allocated to external revenue generating 
segments where the final economic benefit is derived. 
This enhanced method of reporting is being used by 
the CODM, to target product costing, product line 
profitability analysis, customer profitability analysis, and 
service pricing structures.

The operating segments are as follows:

Australasia: Manufacturing and distribution facilities are 
located in Australia, and distribution facilities are located 
in New Zealand. Sales offices are located in all states 
in Australia.

EurAsia: Sales distribution based in China and 
Australasia, servicing European and Asian countries.

Americas: Sales office is located in Florida. Custom 
blind assembly and distribution facilities are located 
in both California and Florida which service the North 
American region.

Middle East and North Africa (‘MENA’): A sales office 
and distribution facility is located in the United Arab 
Emirates to service this market.

The ‘Other Segments’ represents Corporate and 
Intersegment eliminations. The results from our 
manufacturing operations in China are allocated to 
the operating segments where the sales originate, 
whilst its assets and liabilities are included within the 
EurAsia segment.

Major customers

During the year ended 30 June 2022 approximately 
38% (2021: 35%) of the Group’s external revenue was 
derived from sales to two customers (2021: Two), one 
customer located in the Australasian region and one 
customer located in the Americas region.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |43

Operating segment information

Consolidated – 2022

Revenue

Sales to external customers

Total revenue

Segment EBITDA

Depreciation and amortisation

Finance costs

Profit/(loss) before income  
tax expense

Income tax expense

Profit after income tax expense

Assets

Segment assets

Total assets

Liabilities

Segment liabilities

Total liabilities

Consolidated – 2021

Revenue

Sales to external customers

Total revenue

Segment EBITDA

Depreciation and amortisation

Finance costs

Profit/(loss) before income  
tax expense

Income tax expense

Profit after income tax expense

Assets

Segment assets

Total assets

Liabilities

Segment liabilities

Total liabilities

Australasia 
$’000

Americas 
$’000

MENA 
$’000

Eurasia 
$’000

Other 
Segments 
$’000

Total 
$’000

93,704

93,704

11,535

(3,603)

(703)

95,641

95,641

13,015

(5,855)

(1,200)

8,556

8,556

1,553

(242)

(50)

7,642

7,642

2,591

(270)

(51)

–

–

205,543

205,543

(5,768)

22,926

–

–

(9,970)

(2,004)

7,229

5,960

1,261

2,270

(5,768)

10,952

(3,335)

7,617

48,021

85,717

10,881

41,861

23,757

210,237

27,082

39,224

576

17,870

27,509

210,237

112,261

112,261

Australasia 
$’000

Americas 
$’000

MENA 
$’000

Eurasia 
$’000

Other 
Segments 
$’000

Total 
$’000

91,971

91,971

14,397

(3,828)

(698)

96,219

96,219

13,515

(4,822)

(1,002)

8,603

8,603

2,208

(239)

(48)

8,430

8,430

2,722

(309)

(50)

–

–

205,223

205,223

(4,626)

28,216

–

–

(9,198)

(1,798)

9,871

7,691

1,921

2,363

(4,626)

17,220

39,689

73,694

11,008

41,531

22,489

24,464

32,464

633

17,899

20,032

(4,893)

12,327

188,411

188,411

95,492

95,492

Accounting policy for operating segments

Operating segments are presented using the ‘management approach’, where the information presented is on the 
same basis as the internal reports provided to the CODM. The CODM is responsible for the allocation of resources 
to operating segments and assessing their performance.

2022 ANNUAL REPORT | GALE PACIFIC |44

Note 5. Other income

Other income

Note 6. Expenses

Consolidated

2022 
$’000

1,079

2021 
$’000

1,935

Consolidated

2022 
$’000

2021 
$’000

Profit before income tax includes the following specific expenses:

Raw materials and consumables used

Provision for personal protective equipment (note 11)

– 

6,574

Depreciation

Property, plant and equipment (note 12)

Right-of-use assets (note 14)

Total depreciation

Amortisation

Intangible assets (note 13)

Total depreciation and amortisation

Employee benefits expense

Employment costs and benefits

Share-based payment expense

Total employee benefits expense

Finance costs

Interest and finance charges paid/payable on borrowings

Interest and finance charges paid/payable on lease liabilities

Finance costs expensed

Leases

Variable lease payments

4,589

4,716

9,305

665

9,970

40,285

999

41,284

1,108

896

2,004

4,423

4,207

8,630

568

9,198

38,819

1,435

40,254

1,013

784

1,797

1,549

1,648

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |Note 7. Income tax

Income tax expense

Current tax

Deferred tax (Benefit)/Expense – origination and reversal of 
temporary differences

Aggregate income tax expense

Deferred tax included in income tax expense comprises:

Decrease/(increase) in deferred tax assets

Numerical reconciliation of income tax expense and tax at the 
statutory rate

Profit before income tax expense

Tax at the statutory tax rate of 30%

Tax effect amounts which are not deductible/(taxable) in calculating 
taxable income:

Non allowable/(non assessable) items

Difference in tax rates

Income tax expense

Amounts charged directly to equity

Deferred tax assets

45

Consolidated

2022 
$’000

2021 
$’000

4,444

1,503

(1,109)

3,335

3,390

4,893

(1,109)

3,390

10,952

3,286

17,220

5,166

232

3,518

(183)

3,335

117

5,283

(390)

4,893

Consolidated

2022 
$’000

2021 
$’000

136

112

2022 ANNUAL REPORT | GALE PACIFIC |46

Note 7. Income tax (continued)

Net deferred tax asset

Deferred taxes comprises temporary differences attributable to:

Amounts recognised in P&L:

Tax losses

Property, plant and equipment

Foreign exchange

Capitalised costs

Provisions

Impairment of receivables

Other financial liabilities

Employee benefits

Other

Deferred tax asset

Movements:

Opening balance

Credited/(charged) to profit or loss

Charged to equity

Transfer from current tax liability

Closing balance

Provision for income tax

Provision for income tax

Consolidated

2022 
$’000

2021 
$’000

2,543 

(1,487)

(892)

(598)

110 

177 

6 

840 

187 

886

187 

1,109 

(136)

(274)

886

– 

(885)

(1,249)

(774)

1,667 

174 

303 

974 

(23)

187

3,335 

(3,390)

(112)

354 

187

Consolidated

2022 
$’000

2021 
$’000

3,053

1,156

The 2022 net deferred tax asset of $886,000 (2021: 
$187,000) is comprised of $8,998,000 in deferred 
tax assets (2021: $6,889,000) and $8,112,000 (2021: 
$6,702,000) in deferred tax liabilities, reflecting various 
tax positions in different jurisdictions.

As at 30 June 2022, the Group has $9,953,000 unused 
tax losses (2021: $nil) and $2,543,000 deferred tax 
with respect to any such losses (2021: $nil) in the 
consolidated financial statements, which are related to 
the Gale Pacific USA Inc entity, primarily driven by the 
write-off of Personal protective equipment (Gale Guard) 
which was provided for in full in the 2021 financial year.

Accounting policy for income tax

The tax currently payable is based on taxable profit for 
the financial year. Taxable profit differs from profit as 
reported in the statement of 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. The Group’s liability for 
current tax is calculated using tax rates that have been 
enacted or substantively enacted by the end of the 
reporting period.

Deferred tax assets and liabilities are recognised for 
temporary differences at the tax rates expected to be 
applied when the assets are recovered or liabilities are 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |47

settled, based on those tax rates that are enacted or 
substantively enacted, except for:

entity or different taxable entities which intend to 
settle simultaneously.

 ■ When the deferred income tax asset or liability arises 
from the initial recognition of goodwill or an asset 
or liability in a transaction that is not a business 
combination and that, at the time of the transaction, 
affects neither the accounting nor taxable profits; or

 ■ When the taxable temporary difference is associated 
with interests in subsidiaries, associates or joint 
ventures, and the timing of the reversal can be 
controlled and it is probable that the temporary 
difference will not reverse in the foreseeable future.

Gale Pacific Limited (the ‘head entity’) and its 
wholly-owned Australian subsidiaries have formed 
an income tax consolidated group under the tax 
consolidation regime. The head entity and each 
subsidiary in the tax consolidated group continue to 
account for their own current and deferred tax amounts. 
The tax consolidated group has applied the ‘separate 
taxpayer within group’ approach in determining the 
appropriate amount of taxes to allocate to members of 
the tax consolidated group.

In addition to its own current and deferred tax amounts, 
the head entity also recognises the current tax liabilities 
(or assets) and the deferred tax assets arising from 
unused tax losses and unused tax credits assumed from 
each subsidiary in the tax consolidated group.

Assets or liabilities arising under tax funding 
agreements with the tax consolidated entities are 
recognised as amounts receivable from or payable to 
other entities in the tax consolidated group. The tax 
funding arrangement ensures that the intercompany 
charge equals the current tax liability or benefit of each 
tax consolidated group member, resulting in neither a 
contribution by the head entity to the subsidiaries nor a 
distribution by the subsidiaries to the head entity.

Deferred tax assets are recognised for deductible 
temporary differences and unused tax losses only if it is 
probable that future taxable amounts will be available to 
utilise those temporary differences and losses.

The carrying amount of recognised and unrecognised 
deferred tax assets are reviewed at each reporting 
date. Deferred tax assets recognised are reduced 
to the extent that it is no longer probable that future 
taxable profits will be available for the carrying amount 
to be recovered. Previously unrecognised deferred tax 
assets are recognised to the extent that it is probable 
that there are future taxable profits available to recover 
the asset.

Deferred tax assets and liabilities are offset only where 
there is a legally enforceable right to offset current tax 
assets against current tax liabilities and deferred tax 
assets against deferred tax liabilities; and they relate to 
the same taxable authority on either the same taxable 

Note 8. Earnings per share

Profit after income tax attributable to the owners of Gale Pacific Limited

Consolidated

2022 
$’000

7,617

2021 
$’000

12,326

Number

Number

Weighted average number of ordinary shares used in calculating basic earnings 
per share

276,062,536

275,391,310

Adjustments for calculation of diluted earnings per share:

Performance rights

Weighted average number of ordinary shares used in calculating diluted 
earnings per share

Basic earnings per share

Diluted earnings per share

18,049,075

17,608,820

294,111,611

293,000,130

Cents

2.76 

2.59

Cents

4.48

4.21

2022 ANNUAL REPORT | GALE PACIFIC |48

Note 8. Earnings per share (continued)

Accounting policy for earnings per share

Basic earnings per share

Basic earnings per share is calculated by dividing the profit attributable to the owners of Gale Pacific Limited, 
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary 
shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the 
financial year. 

Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into 
account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary 
shares and the weighted average number of shares assumed to have been issued for no consideration in relation to 
dilutive potential ordinary shares.

Note 9. Current assets – cash and cash equivalents

Cash on hand

Cash at bank

Consolidated

2022 
$’000

4

28,461

28,465

2021 
$’000

5

30,402

30,407

Accounting policy for cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, 
highly liquid investments with original maturities of three months or less that are readily convertible to known 
amounts of cash and which are subject to an insignificant risk of changes in value.

Note 10. Current assets – trade and other receivables

Trade receivables

Less: Allowance for expected credit losses

Other receivables

Consolidated

2022 
$’000

49,124

(2,039)

2021 
$’000

42,545 

(1,621)

47,085 

40,924 

210

47,295

547

41,471

Allowance for expected credit losses
The Group has recognised an additional expected credit loss allowance of $487,000 (2021: $465,000) in profit or 
loss in respect of impairment of receivables for the year ended 30 June 2022.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |Trade receivables and allowances for expected credit losses
The following table details the risk profile of trade receivables based on the Group’s provision matrix. 

49

Trade receivables

Not Outside of Credit Terms

Outside Credit Terms 0-30 Days

Outside Credit Terms 31-120 Days

Outside Credit Terms 121 Days to one year

More than One Year

Allowance for expected credit losses

Outside Credit Terms 31-120 Days

Outside Credit Terms 121 Days to one year

More than One Year

Consolidated

2022 
$’000

2021 
$’000

38,901 

30,620 

3,983 

1,725 

2,289 

2,226 

6,257 

1,854 

1,589 

2,225 

49,124 

42,545 

(2)

(46)

(1,991)

(2,039)

(2)

(30)

(1,589)

(1,621)

As per management’s assessment the allowance for expected credit losses on Not Outside of Credit Terms and 
Outside Credit Terms 0-30 Days is not material and not recognised.

Movements in the allowance for expected credit losses are as follows:

Opening balance

Additional allowances recognised

Receivables written off during the year as uncollectable

Closing balance

Consolidated

2022 
$’000

1,621 

487 

(69)

2,039

2021 
$’000

1,199 

465 

(43)

1,621

Accounting policy for trade and 
other receivables
Trade receivables are initially recognised at fair value 
and subsequently measured at amortised cost using 
the effective interest method, less any provision 
for impairment. 

Other receivables are recognised at amortised cost, less 
any allowance for expected credit losses.

The Group always measures the loss allowance for 
trade receivables at an amount equal to lifetime ECL. 
The average credit terms vary between 30 to 60 
days which depend on the sales region and the type 
of customer. The expected credit losses on trade 
receivables are estimated using a provision matrix by 

reference to past default experience of the debtor and 
an analysis of the debtor’s current financial position, 
adjusted for factors that are specific to the debtors, 
general economic conditions of the industry in which 
the debtors operate and an assessment of both the 
current as well as the forecast direction of conditions 
at the reporting date. The Group has recognised a loss 
allowance of 89% (2021: 71%) against all receivables 
over 365 days past due because historical experience 
has indicated that these receivables are generally not 
recoverable. The Group has significantly increased the 
expected loss rates for trade receivables from the prior 
year based on its judgement of the impact of current 
economic conditions and the forecast direction of travel 
at the reporting date. There has been no change in the 

2022 ANNUAL REPORT | GALE PACIFIC |50

Note 10. Current assets – trade and other receivables (continued)

estimation techniques during the current reporting period. The Group writes off a trade receivable when there is 
information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery, 
e.g. when the debtor has been placed under liquidation or has entered into bankruptcy proceedings. 

Note 11. Current assets – inventories

Raw materials

Work in progress

Finished goods

Less: Provision for impairment

Consolidated

2022 
$’000

10,064

2,206

48,017 

(3,988)

44,029 

56,299 

2021 
$’000

8,177

2.958

44,958 

(9,546)

35,412 

46,547 

Accounting policy for inventories
Raw materials, work in progress and finished goods are stated at the lower of cost and net realisable value on a 
‘weighted average cost’ basis. Cost comprises of direct materials and delivery costs, direct labour, import duties 
and other taxes, an appropriate proportion of variable and fixed overhead expenditure based on normal operating 
capacity, and, where applicable, transfers from cash flow hedging reserves in equity. Costs of purchased inventory 
are determined after deducting rebates and discounts received or receivable.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of 
completion and the estimated costs necessary to make the sale.

Note 12. Non-current assets – property, plant and equipment

Buildings and leasehold improvements – at cost

Less: Accumulated depreciation

Plant and equipment – at cost

Less: Accumulated depreciation

Motor vehicles – at cost

Less: Accumulated depreciation

Capital work-in-progress – at cost

Consolidated

2022 
$’000

17,974 

(8,464)

9,510 

119,304 

(98,706)

20,598 

309 

(134)

175 

562 

2021 
$’000

17,399 

(7,701)

9,698 

114,584 

(94,712)

19,872 

305 

(142)

163 

972 

30,845 

30,705 

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |51

Reconciliations
Reconciliations of the movements in property, plant and equipment at the beginning and end of the current and 
previous financial year are set out below:

Consolidated

Buildings and 
leasehold 
improvements 
$.000

Plant and 
equipment 
$’000

Motor 
vehicles 
$’000

Capital 
work in 
progress 
$’000

Balance at 1 July 2020

10,465

21,378

Additions

Disposals

Exchange differences

Transfers in/(out)

Depreciation expense

Balance at 30 June 2021

Additions

Disposals

Exchange differences

Transfers in/(out)

Depreciation expense

Balance at 30 June 2022

25

–

(26)

236

(1,002)

9,698

90

(69)

427

402

(1,038)

9,510

73

(96)

(102)

2,028

(3,409)

19,872

2,456

(53)

653

1,203

(3,533)

20,598

118

52

–

–

5

(12)

163

–

–

4

–

(18)

149

393

2,852

–

(4)

(2,269)

–

972

1,414

–

(16)

(1,782)

–

588

Total 
$’000

32,354

3,002

(96)

(132)

–

(4,423)

30,705

3,960

(122)

1,068

(177)

(4,589)

30,845

Leasehold improvements are depreciated over the 
unexpired period of the lease or the estimated useful 
life of the assets, whichever is shorter.

An item of property, plant and equipment is 
derecognised upon disposal or when there is no 
future economic benefit to the Group. Gains and 
losses between the carrying amount and the disposal 
proceeds are taken to profit or loss. 

Accounting policy for property, plant 
and equipment
Property, plant and equipment is stated at historical 
cost less accumulated depreciation and impairment. 
Historical cost includes expenditure that is directly 
attributable to the acquisition of the items.

Depreciation is calculated on a straight line basis to 
allocate cost on a systematic basis for each item of 
property, plant and equipment over their estimated 
useful lives as follows: 

Buildings

45 years

Leasehold improvements

Over lease term

Plant and equipment

Motor vehicles

2-15 years

2-5 years

Depreciation commences from the time the asset is 
held ready for use. The residual values, useful lives and 
depreciation methods are reviewed, and adjusted if 
appropriate, at each reporting date. When changes are 
made, adjustments are reflected in current and future 
periods only.

2022 ANNUAL REPORT | GALE PACIFIC |52

Note 13. Non-current assets – intangibles

Goodwill – at cost

Less: Impairment

Development – at cost

Less: Accumulated amortisation

Patents, trademarks and licenses – at cost

Less: Accumulated amortisation

Application software – at cost

Less: Accumulated amortisation

Consolidated

2022 
$’000

11,275 

(7,961)

3,314 

5,075 

(790)

4,285 

1,682 

(1,462)

220 

9,312 

(8,337)

975 

8,794

2021 
$’000

11,027 

(7,961)

3,066 

4,074 

(404)

3,670 

1,652 

(1,410)

242 

8,966 

(7,802)

1,164 

8,142

Reconciliations

Reconciliations of the written down values at the beginning and end of the current and previous financial year are 
set out below:

Consolidated

Balance at 1 July 2020

Additions

Exchange differences

Amortisation expense

Balance at 30 June 2021

Additions

Exchange differences

Transfers in/(out)

Amortisation expense

Balance at 30 June 2022

Goodwill 
$’000

Development 
$’000

Patents, 
trademarks 
and licenses 
$’000

Application 
software 
$’000

3,325

–

(259)

–

3,066

–

248

–

–

3,314

3,051

837

(4)

(214)

3,670

877

3

120

(385)

4,285

277

18

(1)

(52)

242

8

–

–

(30)

220

1,466

–

–

(302)

1,164

4

–

57

(250)

975

Total 
$’000

8,119

855

(264)

(568)

8,142

889

251

177

(665)

8,794

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |53

Goodwill acquired through business combinations have been allocated to the following cash generating units (CGU):

Goodwill

USA (2022: US$2,077,000; 2021: US$ 2,077,000)

China

Consolidated

2022 
$’000

2021 
$’000

2,967 

347

3,314 

2,719

347

3,066 

Impairment testing for goodwill

In accordance with the accounting policies, the Group 
performs an annual impairment assessment of goodwill. 
The review did not result in an impairment charge 
being recognised by the Group for the year ended 
30 June 2022.

Impairment testing approach

Impairment testing compares the carrying value 
of a CGU with its recoverable amount, based on 
value-in-use. Value-in-use was calculated based on 
the present value of cash flow projections over a five 
year period with the period extending beyond five 
years extrapolated using a terminal growth rate of 2.0% 
(2021: 2.0%).

invest in product development and expansion within 
the Americas region. The terminal growth rate was set 
at 2% inline with the long-term real growth rate of the 
US economy. 

Sensitivity analysis

Management have conducted an analysis of the 
sensitivity of the impairment test to reasonably possible 
changes in the key assumptions used to determine the 
recoverable amount of the CGU. This sensitivity analysis 
considered the changes to terminal growth rate from 
1.5% to 2.5% and discount rate from 9.25% to 10.75%. 
The analysis revealed that there is sufficient headroom 
in all instances of changes for two factors and there is 
no risk of impairment.

USA

China

In assessing the recoverable amount of the USA CGU, 
management considered information available from 
industry analysts and other sources in relation to the 
key assumptions used. Management considers that it 
has taken an appropriate view of the market conditions 
and business operations.

The following assumptions were used in the 
value-in-use calculations in the model for USA:

Discount Rate

The pre-tax discount rate used in the model is 10.0% 
(2021: 8.5%)

EBITDA assumptions

In assessing the recoverable amount of the China CGU, 
management made a number of significant assumptions 
including assumptions regarding foreign exchange 
rates, and risk adjustments to future cash flows. 
Management considered information available from 
industry analysts and other sources in relation to key 
assumptions used. Management considers that it has 
taken a conservative view of the market conditions and 
business operations. 

Management believes that any reasonably possible 
change in the key assumptions on which recoverable 
amount is based would not cause the carrying amount 
to exceed the recoverable amount of the CGU.

EBITDA for FY2023 is based on the Board approved 
budget, with FY2024 to FY2027 increasing by an 
average of 5.0% per annum, which is in line with the 
management’s growth strategies for the short to 
medium term. Management believes this is achievable 
based on historical trends and the plans to continue to 

Accounting policy for intangible assets

Intangible assets acquired as part of a business 
combination, other than goodwill, are initially measured 
at their fair value at the date of the acquisition. 
Intangible assets acquired separately are initially 
recognised at cost. Indefinite life intangible assets are 

2022 ANNUAL REPORT | GALE PACIFIC |54

Note 13. Non-current assets – intangibles (continued)

not amortised and are subsequently measured at cost 
less any impairment. Finite life intangible assets are 
subsequently measured at cost less amortisation and 
any impairment. The gains or losses recognised in profit 
or loss arising from the derecognition of intangible 
assets are measured as the difference between net 
disposal proceeds and the carrying amount of the 
intangible asset. The method and useful lives of finite 
life intangible assets are reviewed annually. Changes 
in the expected pattern of consumption or useful 
life are accounted for prospectively by changing the 
amortisation method or period.

Goodwill

Goodwill arises on the acquisition of a business. 
Goodwill is not amortised. Instead, goodwill is 
tested annually for impairment, or more frequently 
if events or changes in circumstances indicate 
that it might be impaired and is carried at cost less 
accumulated impairment losses. Impairment losses 
on goodwill are taken to profit or loss and are not 
subsequently reversed.

Research and development

Research costs are expensed in the period in which 
they are incurred. Development costs are capitalised 
when it is probable that the project will be a success 
considering its commercial and technical feasibility; 
the Group is able to use or sell the asset; the Group 
has sufficient resources; and intent to complete 
the development and its costs can be measured 
reliably. Capitalised development costs are amortised 
on a straight-line basis over the period of their 
expected benefit.

Patents, trademarks and licenses

Significant costs associated with patents and 
trademarks are deferred and amortised on a straight-
line basis over the period of their expected benefit, 
being their finite useful life of 20 years.

Application software

Significant costs associated with software are deferred 
and amortised on a straight-line basis over the period 
of their expected benefit, being their finite useful life of 
5 years.

Note 14. Non-current assets – right-of-use assets

Land and buildings – right-of-use

Less: Accumulated depreciation

Consolidated

2022 
$’000

35,570 

(9,155)

26,415

2021 
$’000

27,664 

(7,350)

20,314

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |55

Note 14. Non-current assets – right-of-use assets (continued)

Reconciliations

Reconciliations of the written down values at the beginning and end of the current and previous financial year are 
set out below:

Consolidated

Balance at 1 July 2020

Additions

Disposals

Exchange differences

Depreciation expense

Balance at 30 June 2021

Additions

Exchange differences

Depreciation expense

Balance at 30 June 2022

Land 
buildings – 
right-of-use 
$’000

21,780

4,784

(1,427)

(616)

(4,207)

20,314

9,384

1,433

(4,716)

26,415

Accounting policy for right-of-use assets

A right-of-use asset is recognised at the commencement date of a lease. The right-of-use asset is measured at cost, 
which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or 
before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except 
where included in the cost of inventories, an estimate of costs expected to be incurred for dismantling and removing 
the underlying asset, and restoring the site or asset.

Right-of-use assets are depreciated on a straight-line basis over the unexpired period of the lease or the estimated 
useful life of the asset, whichever is the shorter. Where the Group expects to obtain ownership of the leased asset 
at the end of the lease term, the depreciation is over its estimated useful life. Right-of use assets are subject to 
impairment or adjusted for any remeasurement of lease liabilities.

The Group has elected not to recognise a right-of-use asset and corresponding lease liability for short-term leases 
with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to 
profit or loss as incurred.

Note 15. Current liabilities – trade and other payables

Trade payables

Sundry payables and accruals – Customer rebates

Sundry payables and accruals – Other

Refer to note 25 for further information on financial instruments.

Consolidated

2022 
$’000

17,175 

9,420 

4,097 

2021 
$’000

17,927 

8,054 

3,526 

30,692

29,507

2022 ANNUAL REPORT | GALE PACIFIC |56

Note 15. Current liabilities – trade and other payables (continued)

Accounting policy for trade and other payables

These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial 
year and which are unpaid. Due to their short-term nature they are measured at amortised cost and are not 
discounted. The amounts are unsecured and are usually paid within 30 days of recognition.

Note 16. Current liabilities – borrowings

Bank loans

Consolidated

2022 
$’000

2021 
$’000

21,059

19,364

Refer to note 25 for further information on financial instruments. Refer note 19 for non-current portion of 
the borrowings.

Note 17. Current liabilities – provisions

Warranties

Warranties

Consolidated

2022 
$’000

507

2021 
$’000

501

The provision represents the estimated warranty claims in respect of products sold which are still under warranty at 
the reporting date. The provision is estimated based on historical warranty claim information, sales levels and any 
recent trends that may suggest future claims could differ from historical amounts.

Warranty movements

Carrying amount at the start of the year

Additional provisions recognised

Claims

Carrying amount at the end of the year

Accounting policy for provisions

Consolidated

2022 
$’000

2021 
$’000

501 

382 

(376)

507

144 

708 

(351)

501

Provisions are recognised when the Group has a present (legal or constructive) obligation as a result of a past 
event, it is probable 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 reporting date, taking into account the risks and uncertainties surrounding the 
obligation. If the time value of money is material, provisions are discounted using a current pre-tax rate specific to 
the liability. The increase in the provision resulting from the passage of time is recognised as a finance cost in profit 
or loss.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |Note 18. Current liabilities – lease liabilities

Lease liability

Refer to note 25 for further information on financial instruments.

Note 19. Non-current liabilities – borrowings

Total Bank loans

Refer to note 25 for further information on financial instruments.

Total secured liabilities

The total secured liabilities (current and non-current) are as follows:

Total Bank loans

Assets pledged as security

57

Consolidated

2022 
$’000

4,677

2021 
$’000

3,764

Consolidated

2022 
$’000

12,935

2021 
$’000

9,575

Consolidated

2022 
$’000

2021 
$’000

33,994

28,939

The bank loans are secured by a fixed and floating charge (or equivalent foreign charge) over all the assets and 
undertakings, including uncalled capital of each entity in the Group.

Accounting policy for borrowings

Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. 
They are subsequently measured at amortised cost using the effective interest method.

2022 ANNUAL REPORT | GALE PACIFIC |58

Note 20. Non-current liabilities – lease liabilities

Lease liability – 1 to 5 years

Lease liability – greater than 5 years

Consolidated

2022 
$’000

22,624 

1,487 

24,111

2021 
$’000

17,977 

602 

18,579

Refer to note 25 for further information on financial instruments.

Accounting policy for lease liabilities

A lease liability is recognised at the commencement date of a lease. The lease liability is initially recognised at 
the present value of the lease payments to be made over the term of the lease, discounted using the interest rate 
implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing rate. Lease 
payments comprise of fixed payments less any lease incentives receivable, variable lease payments that depend 
on an index or a rate, amounts expected to be paid under residual value guarantees, exercise price of a purchase 
option when the exercise of the option is reasonably certain to occur, and any anticipated termination penalties. 
The variable lease payments that do not depend on an index or a rate are expensed in the period in which they 
are incurred.

Lease liabilities are measured at amortised cost using the effective interest method. The carrying amounts are 
remeasured if there is a change in the following: future lease payments arising from a change in an index or a rate 
used; residual guarantee; lease term; certainty of a purchase option and termination penalties. When a lease liability 
is remeasured, an adjustment is made to the corresponding right-of use asset, or to profit or loss if the carrying 
amount of the right-of-use asset is fully written down.

Note 21. Equity – issued capital

Consolidated

Consolidated

2022 
Shares

2021  
Shares

2022 
$’000

2021 
$’000

Ordinary shares fully paid

276,393,042

275,391,310

63,403

63,068

Movements in ordinary share capital

Consolidated

Opening Balance

Consolidated

2022 
Shares

2021  
Shares

2022 
$’000

2021 
$’000

275,391,310

275,391,310

63,068

63,068

Vesting of performance rights

1,001,732

–

335

–

Closing Balance

Ordinary shares

276,393,042

275,391,310

63,403

63,068

Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in 
proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value 
and the Company does not have a limited amount of authorised capital.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |59

Capital is regarded as total equity, as recognised in 
the statement of financial position, plus net debt. Net 
debt is calculated as total borrowings less cash and 
cash equivalents.

In order to maintain or adjust the capital structure, the 
Group may adjust the amount of dividends paid to 
shareholders, return capital to shareholders, issue new 
shares or sell assets to reduce debt.

Accounting policy for issued capital

Ordinary shares are classified as equity.

Incremental costs directly attributable to the issue 
of new shares or options are shown in equity as a 
deduction, net of tax, from the proceeds.

Consolidated

2022 
$’000

2,195 

435 

3,271 

4,434 

10,335

2021 
$’000

(2,201)

118 

2,607 

3,935 

4,459

On a show of hands every member present at a meeting 
in person or by proxy shall have one vote and upon a 
poll each share shall have one vote.

Share buy-back

No new buy-back scheme was effective for the financial 
year ended 30 June 2022.

Vesting of performance rights

1,001,732 performance rights vested meeting the 
performance and time hurdles during the financial year 
ended 30 June 2022 (2021: Nil).

Capital risk management

The Group’s objectives when managing capital is to 
safeguard its ability to continue as a going concern, so 
that it can provide returns for shareholders and benefits 
for other stakeholders and to maintain an optimum 
capital structure to reduce the cost of capital. This is 
achieved through monitoring of historical and forecast 
performance and cash flows.

Note 22. Equity – reserves

Foreign currency reserve

Hedging reserve – cash flow hedges

Share-based payments reserve

Enterprise reserve fund

Foreign currency reserve

The reserve is used to recognise exchange differences arising from the translation of the financial statements 
of foreign operations to Australian dollars. It is also used to recognise gains and losses on hedges of the net 
investments in foreign operations.

Hedging reserve – cash flow hedges

The reserve is used to recognise the effective portion of the gain or loss of cash flow hedge instruments that is 
determined to be an effective hedge.

Share-based payments reserve

The reserve is used to recognise the value of equity benefits provided to employees and directors as part of their 
remuneration, and other parties as part of their compensation for services.

2022 ANNUAL REPORT | GALE PACIFIC |60

Note 22. Equity – reserves (continued)

Enterprise reserve fund 

Gale Pacific Special Textiles (Ningbo) Limited and Gale Pacific Trading (Ningbo) Limited are required by Chinese 
Company Law to maintain this reserve in its financial statements. This reserve is unavailable for distribution to 
shareholders but can be used to expand the entity’s business, make up losses or increase the registered capital. 
Both companies are required to allocate 10% of their annual profit after tax to this reserve until it reaches 50% of the 
registered capital.

Movements in reserves

Movements in each class of reserve during the current and previous financial year are set out below:

Consolidated

Balance at 1 July 2020

Foreign currency translation*

Movement in hedge

Income tax

Share-based payment

Statutory transfers from retained earnings

Balance at 30 June 2021

Foreign currency translation*

Movement in hedge

Income tax

Share-based payment

Vesting of performance rights

Statutory transfers from retained earnings

Foreign 
currency 
$.000

(991)

(1,210)

–

–

–

–

(2,201)

4,396

–

–

–

–

–

Hedging 
$’000

(145)

–

342

(79)

–

–

118

–

454

(137)

–

–

–

Share-
based 
payments 
$’000

Enterprise 
reserve 
fund 
$’000

1,172

3,956

–

–

–

1,435

–

2,607

–

–

–

999

(335)

–

–

–

–

–

(21)

3,935

–

–

–

–

–

499

4,434

Total 
$’000

3,992

(1,210)

342

(79)

1,435

(21)

4,459

4,396

454

(137)

999

(335)

499

10,335

Balance at 30 June 2022

2,195

435

3,271

*  Refer to note 24 for details of monetary items identified as a net investment in a foreign operation

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |Note 23. Equity – dividends
Dividends paid during the financial year were as follows:

Final Dividend for the year ended 30 June 2020 of 1.00 cent per ordinary 
share (unfranked)

Interim Dividend for the year ended 30 June 2021 of 2.00 cents per 
ordinary share (unfranked)

Final Dividend for the year ended 30 June 2021 of 2.00 cents per 
ordinary share (unfranked)

Interim Dividend for the year ended 30 June 2022 of 1.00 cent per 
ordinary share (50% franked)

61

Consolidated

2022 
$’000

2021 
$’000

– 

– 

5,508 

2,764 

8,272

2,754 

5,508 

– 

– 

8,262

On 23 August 2022 the Directors declared a dividend of 1.00 cent per share to the holders of fully paid ordinary 
shares in respect of the year ended 30 June 2022. This dividend has not been included as a liability in these 
financial statements. Including the final dividend with respect to 30 June 2022, for the full year, the dividends of 
2.00 cents per ordinary share have been declared on earnings of 2.76 cents per share.

Accounting policy for dividends

Dividends are recognised when declared during the financial year and no longer at the discretion of the Company.

Note 24. Monetary items identified as a net investment in a 
foreign operation

Related party receivable to the Company from Gale Pacific Special 
Textiles (Ningbo) Limited

Related party receivable to the Company from Gale Pacific 
(New Zealand) Limited

Consolidated

2022 
$’000

2021 
$’000

10,306 

9,444 

2,958 

13,264

3,828 

13,272

The foreign exchange gain arising during the financial year on monetary items forming part of the net investment in 
related party, recognised in foreign currency translation reserve is detailed in note 22.

Note 25. Financial instruments

Financial risk management objectives
The Group’s activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. 

The Group’s financial risk management processes and procedures seek to minimise the potential adverse effects on 
the Group’s financial performance that may occur due to the unpredictability of financial markets. Risk management 
policies are reviewed regularly to reflect changes in market conditions and the Group’s activities.

2022 ANNUAL REPORT | GALE PACIFIC |62

Note 25. Financial instruments (continued)

Derivative financial instruments are used by the Group to limit exposure to exchange rate risk associated with 
foreign currency transactions. Transactions to reduce foreign currency exposure are undertaken without the use 
of collateral as the Group only deals with reputable institutions with sound financial positions. The Group does not 
enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

Market risk

Foreign currency risk

The Group undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk 
through foreign exchange rate fluctuations.

The Group enters into foreign exchange contracts to buy and sell specified amounts of foreign currency in the future 
at stipulated exchange rates. The objective of entering into forward exchange contracts is to protect the Group 
against exchange rate movements for both contracted and anticipated future sales and purchases undertaken in 
foreign currencies. There was no cash flow hedge ineffectiveness during the reporting period.

The Group adopts hedge accounting and classifies applicable forward exchange contracts as cash flow hedges 
where these contracts are hedging highly probable forecasted transactions and they are timed to mature when the 
cash flow from the underlying transaction is scheduled to occur. Cash flows are expected to occur during the next 
financial year. 

The Group adopts fair value hedge accounting on forward exchange contracts that are designated and qualify as 
fair value hedges. Forward exchange contracts are recognised in the profit and loss immediately, together with any 
changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. 

The maturity, settlement amounts and the average contractual exchange rates of the Group’s outstanding forward 
foreign exchange contracts at the reporting date were as follows:

Consolidated

Buy US dollars/sell Australian dollars

Maturity:

Less than 6 months

6 – 12 months

Consolidated

Buy Chinese yuan/sell US dollars

Maturity:

Less than 6 months

Sell Australian dollars

Average exchange rates

2022  
$’000

2021 
$’000

2022

2021

12,554

1,950

8,313

1,362

0.7185

0.7179

0.7638

0.7710

Sell US dollars

Average exchange rates

2022  
$’000

2021 
$’000

2022

2021

35,400

33,000

6.4500

6.5112

The carrying amount of the Group’s foreign currency denominated financial assets and financial liabilities at the 
reporting date were as follows:

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |Consolidated

US dollars

New Zealand dollars

Chinese renminbi

UAE dirham

63

Assets

Liabilities

2022 
$’000

2021 
$’000

2022 
$’000

2021 
$’000

58,489

60,370

27,274

26,097

1,527

1,326

1,104

746

489

849

437

–

–

275

–

–

62,446

62,454

27,711

26,372

The Group had net assets denominated in foreign currencies of $34,735,000 (assets of $62,446,000 less liabilities 
of $27,711,000 as at 30 June 2022 (2021: $36,082,000 (assets of $62,454,000 less liabilities of $26,372,000)). 
Based on this exposure, had the Australian dollar strengthened by 10% / weakened by 10% (2021: strengthened by 
10% / weakened by 10%) against these foreign currencies with all other variables held constant, the Group’s profit 
before tax for the year would have been $103,000 lower/higher (2021: $285,000 higher/lower) and equity would 
have been $3,296,000 lower/higher (2021: $2,952,000 higher/lower). The percentage change is the expected 
overall volatility of the significant currencies, which is based on management’s assessment of reasonable possible 
fluctuations taking into consideration movements over the last 12 months each year and the spot rate at each 
reporting date.

Price risk

The Group is not exposed to any significant price risk.

Interest rate risk

The Group is exposed to interest rate risk as entities in the Group borrow and deposit funds at both fixed and 
variable interest rates. Effective weighted average interest rates on classes of financial liabilities are disclosed under 
liquidity risk. The Group does not use interest rate swaps to manage the risk of interest rate changes.

As at the reporting date, the Group had the following variable rate bank balances and borrowings outstanding:

Consolidated

Cash and cash equivalents

Bank loans

2022

2021

Weighted 
average 
interest rate 
%

Weighted 
average 
interest rate 
%

Balance 
$’000

–

28,465

2.80% 

(33,995)

–

2.19% 

(5,530)

Balance 
$’000

30,407

(28,912)

1,495

An analysis by remaining contractual maturities is shown in ‘liquidity and interest rate risk management’ below.

An official increase/decrease in interest rates of 100 (2021: 100) basis points would have an adverse/favourable 
effect on profit before tax of $339,940 (2021: $289,116) per annum. The percentage change is based on the 
expected volatility of interest rates using market data and analysts forecasts. 

Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss 
to the Group. Before accepting any new customer, the Group uses internal resources and criteria to assess the 
potential customer’s credit quality and defines credit limits by customer. The maximum exposure to credit risk at 
the reporting date to recognised financial assets is the carrying amount, net of any provisions for impairment of 

2022 ANNUAL REPORT | GALE PACIFIC |64

Note 25. Financial instruments (continued)

those assets, as disclosed in the statement of financial 
position and notes to the financial statements. The 
Group does not hold any collateral.

The Group has adopted a lifetime expected loss 
allowance in estimating expected credit losses to trade 
receivables through the use of a provisions matrix using 
fixed rates of credit loss provisioning. These provisions 
are considered representative across all customers of 
the Group based on recent sales experience, historical 
collection rates and forward-looking information that 
is available.

Generally, trade receivables are written off when there 
is no reasonable expectation of recovery. Indicators 
of this include the failure of a debtor to engage in a 
repayment plan, no active enforcement activity and 
a failure to make contractual payments for a period 
greater than 1 year.

Liquidity risk
Liquidity risk is the risk that the Group will not be able 
to meet its financial obligations as they fall due. The 
Group’s approach to managing liquidity is to ensure, as 

far as possible, that it will always have sufficient liquidity 
to meet its liabilities when due, under both normal and 
stressed conditions, without incurring unacceptable 
losses or risking damage to the Group’s reputation.

The Group manages liquidity risk by maintaining 
adequate cash reserves and available borrowing 
facilities by continuously monitoring actual and forecast 
cash flows and matching the maturity profiles of 
financial assets and liabilities.

Remaining contractual maturities

The following tables detail the Group’s remaining 
contractual maturity for its financial instrument 
liabilities. The tables have been drawn up based on the 
undiscounted cash flows of financial liabilities based 
on the earliest date on which the financial liabilities are 
required to be paid. The tables include both interest 
and principal cash flows disclosed as remaining 
contractual maturities and therefore these totals may 
differ from their carrying amount in the statement of 
financial position.

Consolidated – 2022

Non-derivatives

Non-interest bearing

Trade payables

Customer rebates

Other sundry payables and accruals

Interest-bearing – variable

Bank loans

Lease liability

Total non-derivatives

Weighted 
average 
interest 
rate 
%

1 year or 
less 
$’000

Between 
1 and 
2 years 
$’000

Between 
2 and 
5 years 
$’000

Over 
5 years 
$’000

Remaining 
contractual 
maturities 
$’000

–

–

–

17,175

9,420

4,097

–

–

–

2.80% 

21,059

3.41% 

5,782

12,935

6,653

57,533

19,588

–

–

–

–

–

–

–

–

17,148

17,148

2,013

2,013

17,175

9,420

4,097

33,994

31,596

96,282

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |65

Weighted 
average 
interest 
rate 
%

1 year or 
less 
$’000

Between 
1 and 
2 years 
$’000

Between 
2 and 
5 years 
$’000

Over 
5 years 
$’000

Remaining 
contractual 
maturities 
$’000

Consolidated – 2021

Non-derivatives

Non-interest bearing

Trade payables

Customer rebates

Other sundry payables and accruals

Interest-bearing – variable

Bank loans

Lease liability

2.19% 

3.49% 

19,364

4,497

9,575

4,497

Total non-derivatives

53,368

14,072

12,252

–

–

–

17,927

8,054

3,526

–

–

–

–

–

–

–

12,252

–

–

–

–

3,509

3,509

17,927

8,054

3,526

28,939

24,755

83,201

The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually 
disclosed above.

Note 26. Fair value measurement

Fair value hierarchy

The following tables detail the Group’s assets and liabilities, measured or disclosed at fair value, using a three level 
hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the 
measurement date.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either 
directly or indirectly.

Level 3: Unobservable inputs for the asset or liability.

Consolidated – 2022

Liabilities

Forward foreign exchange contracts

Total liabilities

Consolidated – 2021

Assets

Forward foreign exchange contracts

Total liabilities

Level 1 
$’000

Level 2 
$’000

Level 3 
$’000

Total 
$’000

–

–

1,355

1,355

–

–

1,355

1,355

Level 1 
$’000

Level 2 
$’000

Level 3 
$’000

Total 
$’000

–

–

515

515

–

–

515

515

There were no transfers between levels during the financial year.

The net fair value of assets and liabilities approximates their carrying value. No financial assets or financial liabilities 
are readily traded on organised markets in standardised form other than forward exchange contracts.

2022 ANNUAL REPORT | GALE PACIFIC |66

Note 26. Fair value measurement (continued)

Valuation techniques for fair value measurements 
categorised within level 2 and level 3

Derivative financial instruments have been valued 
using quoted market rates. This valuation technique 
maximises the use of observable market data where 
it is available and relies as little as possible on entity 
specific estimates.

Accounting policy for fair value measurement

When an asset or liability, financial or non-financial, is 
measured at fair value for recognition or disclosure 
purposes, the fair value is based on the price that would 
be received to sell an asset or paid to transfer a liability 
in an orderly transaction between market participants 
at the measurement date; and assumes that the 
transaction will take place either: in the principal market; 
or in the absence of a principal market, in the most 
advantageous market.

Fair value is measured using the assumptions that 
market participants would use when pricing the 
asset or liability, assuming they act in their economic 
best interests. For non-financial assets, the fair value 
measurement is based on its highest and best use. 
Valuation techniques that are appropriate in the 
circumstances and for which sufficient data are available 
to measure fair value, are used, maximising the use of 
relevant observable inputs and minimising the use of 
unobservable inputs.

Assets and liabilities measured at fair value are 
classified into three levels, using a fair value hierarchy 
that reflects the significance of the inputs used 
in making the measurements. Classifications are 
reviewed at each reporting date and transfers between 

levels are determined based on a reassessment of 
the lowest level of input that is significant to the fair 
value measurement.

For recurring and non-recurring fair value measurements, 
external valuers may be used when internal expertise 
is either not available or when the valuation is deemed 
to be significant. External valuers are selected based 
on market knowledge and reputation. Where there is a 
significant change in fair value of an asset or liability from 
one period to another, an analysis is undertaken, which 
includes a verification of the major inputs applied in the 
latest valuation and a comparison, where applicable, 
with external sources of data.

Note 27. Related party transactions

Parent entity

Gale Pacific Limited is the parent entity.

Subsidiaries

Interests in subsidiaries are set out in note 30.

Key management personnel

Disclosures relating to key management personnel are 
set out in note 28 and the remuneration report included 
in the directors’ report.

Receivable from and payable to related parties

There were no trade receivables from or trade 
payables to related parties at the current and previous 
reporting date.

Loans to/from related parties

There were no loans to or from related parties at the 
current and previous reporting date.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |67

Note 28. Key management personnel disclosures

Compensation

The aggregate compensation made to directors and other members of key management personnel of the Group is 
set out below:

Short-term employee benefits

Post-employment benefits

Termination benefits

Share-based payments

Note 29. Parent entity information
Set out below is the supplementary information about the parent entity.

Statement of profit or loss and other comprehensive income

Profit after income tax

Total comprehensive income

Statement of financial position

Total current assets

Total assets

Total current liabilities

Total liabilities

Equity

Issued capital

Hedging reserve – cash flow hedges

Share-based payments reserve

Retained profits

Total equity

Consolidated

2022 
$’000

2021 
$’000

3,896,531 

2,732,525 

159,303 

136,696 

171,934 

1,139,584 

1,332,590 

5,367,352

4,201,811

Parent

2022 
$’000

6,511 

6,828

2021 
$’000

10,610

10,873

Parent

2022 
$’000

32,285 

121,441 

25,916 

49,607 

2021 
$’000

22,846 

116,201 

21,688 

43,922 

63,403 

63,068 

435 

3,270 

4,726 

117 

2,606 

6,488 

71,834 

72,279 

Guarantees entered into by the parent entity in relation to the debts of its subsidiaries

The parent entity has guarantees in relation to the debts of its subsidiaries in fixed and floating charges (or 
equivalent foreign charge) over all the assets and undertakings, including uncalled capital of each entity in the 
Group as at 30 June 2021 and 30 June 2022.

2022 ANNUAL REPORT | GALE PACIFIC |68

Note 30. Interests in subsidiaries (continued)

Please note comparative year has been changed to reflect consolidation entries between group entities.

Contingent liabilities

The parent entity had no contingent liabilities as at 30 June 2021 and 30 June 2022.

Significant accounting policies

The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 2, except 
for the following:

 ■ Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.

 ■ Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be 

an indicator of an impairment of the investment.

Note 30. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in 
accordance with the accounting policy described in note 2:

Name

Principal place of business /  
Country of incorporation

Gale Pacific (New Zealand) Limited

New Zealand

Gale Pacific FZE

United Arab Emirates

Gale Pacific Special Textiles (Ningbo) Limited

China

Gale Pacific Trading (Ningbo) Limited

Gale Pacific USA, Inc.

Zone Hardware Pty Ltd 

Riva Window Fashions Pty Ltd 

China

USA

Australia

Australia

Ownership interest

2022 
%

100% 

100% 

100% 

100% 

100% 

100% 

100% 

2021 
%

100% 

100% 

100% 

100% 

100% 

100% 

100% 

Note 31. Share-based payments
The Group maintains a performance rights scheme 
for certain staff and executives, including executive 
directors, as approved by shareholders at an annual 
general meeting. The scheme is designed to reward key 
personnel when the Group meets performance hurdles 
relating to:

 ■ Improvement in earnings per share; and

 ■ Improvement in return to shareholders.

Each performance right entitles the holder one ordinary 
share in the Company when exercised and is subject to 
the satisfying of relevant performance hurdles based on 
improvements in the Group’s diluted earnings per share.

Performance rights issued to executives during the 
financial year were issued in accordance with the 
Group’s remuneration policy which: 

 ■ Reward executives for Group and individual 

performance;

 ■ Align the interests of the executives with those of 

the shareholders; and

 ■ Ensure that total remuneration is competitive by 

market standards.

Refer to note 6 for the amount expensed to profit or loss 
during the financial year.

A share option plan has been established by the 
Group and approved by shareholders at a general 
meeting, whereby the Group may, at the discretion of 
the Nomination and Remuneration Committee, grant 
options over ordinary shares in the Company to certain 
key management personnel of the Group. The options 
are issued for nil consideration and are granted in 
accordance with performance guidelines established by 
the Nomination and Remuneration Committee.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |69

Set out below are summaries of performance rights granted under the plan:

2022

Grant date

Expiry date

Grant price

Balance at 
the start of 
the year

Granted

Exercised

Expired/
forfeited/
other

Balance at 
the end of 
the year

13/11/2018

01/12/2021

$0.35 

886,000

16/01/2020

01/12/2022

$0.26 

1,034,971

30/10/2020

01/12/2023

$0.16 

1,987,000

23/12/2020

01/12/2023

$0.18 

14,000,000

–

–

–

–

23/12/2022

01/12/2024

06/04/2022

01/12/2024

$0.28 

$0.28 

–

–

2,870,000

204,000

(686,836)

(199,164)

–

–

(160,737)

874,234

(314,896)

(640,000)

1,032,104

–

–

–

– 14,000,000

–

–

2,870,000

204,000

17,907,971

3,074,000

(1,001,732)

(999,901) 18,980,338

2021

Grant date

Expiry date

Grant price

Balance at 
the start of 
the year

Granted

Exercised

22/11/2017

01/12/2020

$0.31 

956,000

13/11/2018

01/12/2021

$0.35 

886,000

16/01/2020

01/12/2022

$0.26 

1,034,971

–

–

–

30/10/2020

01/12/2023

23/12/2020

01/12/2023

$0.16 

$0.18 

–

1,987,000

– 14,000,000

2,876,971

15,987,000

–

–

–

–

–

–

Expired/
forfeited/
other

Balance at 
the end of 
the year

(956,000)

–

–

–

–

886,000

1,034,971

1,987,000

– 14,000,000

(956,000)

17,907,971

The performance rights granted on the 
23 December 2021 and 6 April 2022 to the senior 
executives are subject to performance conditions and 
time hurdles as outlined below. 

Performance condition – The number of Rights issued 
that will vest will be determined proportionately from 
zero Rights vesting if the diluted EPS CAGR is less than 
3.0% to 100% of the Rights vesting if the diluted EPS 
CAGR of 10.0% (or higher) is achieved.

Time hurdle – The vesting of your Rights is also 
dependent upon the employee remaining in 
continuous employment with the Company until 
30 September 2024.

623,000 of the performance rights granted on the 
23 December 2021 to the senior executives and 
senior managers are subject only to the time hurdle as 
outlined below. 

Time hurdle – The vesting of your Rights is also 
dependent upon the employee remaining in 

continuous employment with the Company until 
30 November 2024.

Accounting policy for share-based payments

Equity-settled share-based compensation benefits are 
provided to certain employees including executive 
directors. Equity-settled transactions are awards of 
performance rights over shares, that are provided to 
employees in exchange for the rendering of services. 

The cost of equity-settled transactions is measured at 
fair value on grant date. Fair value is independently 
determined using the Monte Carlo simulation option 
pricing model that takes into account the exercise price, 
the term of the option, the impact of dilution, the share 
price at grant date and expected price volatility of the 
underlying share, the expected dividend yield and the 
risk free interest rate for the term of the option, together 
with non-vesting conditions that do not determine 
whether the Group receives the services that entitle the 
employees to receive payment. No account is taken of 
any other vesting conditions.

2022 ANNUAL REPORT | GALE PACIFIC |70

Note 31. Share-based payments (continued)

The cost of equity-settled transactions is recognised as an expense with a corresponding increase in equity over the 
vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, 
the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The 
amount recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less 
amounts already recognised in previous periods.

Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market 
conditions are considered to vest irrespective of whether or not that market condition has been met, provided all 
other conditions are satisfied.

The weighted average fair value of the share options granted during the financial year is $0.28 (2021: $0.18).

Expected volatility is based on the historical share price volatility over the past 3 years. To allow for the effects of 
early exercise, it was assumed that executives and senior employees would exercise the options after vesting date 
when the share price is two and a half times the exercise price.

If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been 
made. An additional expense is recognised, over the remaining vesting period, for any modification that increases 
the total fair value of the share-based compensation benefit as at the date of modification.

If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is 
treated as a cancellation. If the condition is not within the control of the Group or employee and is not satisfied 
during the vesting period, any remaining expense for the award is recognised over the remaining vesting period, 
unless the award is forfeited.

If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining 
expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the 
cancelled and new award is treated as if they were a modification.

Note 32. Remuneration of auditors
During the financial year the following fees were paid or payable for services provided by Deloitte Touche 
Tohmatsu, the auditor of the Company:

Audit services – Deloitte Touche Tohmatsu

Audit or review of the financial statements

Other services – Deloitte Touche Tohmatsu

Other services (including tax services) 

Consolidated

2022 
$

2021 
$

416,806 

385,978

283,328

228,840

700,134

614,818

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |71

Note 33. New accounting standards and interpretations not yet mandatory 
or early adopted
At the date of authorisation of the consolidated financial statements, other Standards and Interpretations in issue 
but not yet effective were listed below.

Standard / amendment

AASB 2020-1 Amendments to Australian Accounting Standards – Classification of 
Liabilities as Current or Non-current and AASB 2020-6 Amendments to Australian 
Accounting Standards – Classification of Liabilities as Current or Non-current – Deferral of 
Effective Date

AASB 2021-2 Amendments to Australian Accounting Standards – Disclosure of 
Accounting Policies and Definition of Accounting Estimates

AASB 2021-5 Amendments to Australian Accounting Standards – Deferred Tax related to 
Assets and Liabilities arising from a Single Transaction

Effective for annual 
reporting periods 
beginning on or after

1 January 2023

1 January 2023

I January 2023

In addition, at the date of authorisation of the financial statements no IASB Standards and IFRIC Interpretations were 
on issue but not yet effective, but for which Australian equivalent Standards and Interpretations have not yet been 
issued. The Directors of the Group do not anticipate that the adoption of above amendments will have a material 
impact in future periods on the financial statements of the Group.

Note 34. Events after the reporting period
On 23 August 2022, the directors declared a 75% franked final dividend of 1.00 cent per share to the holders 
of fully paid ordinary shares in respect of the full-year ended 30 June 2022, to be paid to shareholders on 
14 October 2022. This dividend has not been included as a liability in these consolidated financial statements. The 
total estimated dividend to be paid is $2,800,000. 

No matters or circumstances, other than those disclosed elsewhere in this interim condensed financial report, have 
risen since the end of the financial half year which significantly affected or could significantly affect the operations of 
the Group, the results of those operations or the state of affairs of the Group in future financial years. 

2022 ANNUAL REPORT | GALE PACIFIC |72

In accordance with ASX Listing Rule 4.10, the Company provides the following information to shareholders 
not elsewhere disclosed in this Annual Report. The information provided is current as at 19 August 2022 
(Reporting Date).

Corporate Governance Statement
The Company’s Directors and management are committed to conducting the Group’s business in an ethical manner 
and in accordance with the highest standards of corporate governance. The Company has adopted and complies 
with the ASX Corporate Governance Principles and Recommendations (Fourth Edition) (Recommendations). 

The Company has prepared a statement which sets out the corporate governance practices that were in operation 
throughout the financial year for the Company (Corporate Governance Statement). 

In accordance with ASX Listing Rules 4.10.3 and 4.7.4, the Corporate Governance Statement will be available for 
review on Gale Pacific’s website (https://www.galepacific.com/investor-info/corporate-governance) and will be 
lodged together with an Appendix 4G with ASX at the same time that this Annual Report is lodged with ASX. The 
Appendix 4G will particularise each Recommendation that needs to be reported against by Gale Pacific, and will 
provide shareholders with information as to where relevant governance disclosures can be found. 

The Company’s corporate governance policies and charters are all available on Gale Pacific’s website  
(https://www.galepacific.com/investor-info/corporate-governance). 

Number of holdings of equity securities 
As at the Reporting Date, the number of holders in each class of equity securities on issue in Gale Pacific is 
as follows:

Class of Equity Securities

Fully paid ordinary shares

Performance rights expiring 1 December 2022

Performance rights expiring 1 December 2023

Performance rights expiring 1 December 2024

Number of 
holders

1,865

3

6

15

Voting rights of equity securities
The only class of equity securities on issue in the Company which carry voting rights is ordinary shares.

As at the Reporting Date, there were 1,865 holders of a total of 276,393,420 ordinary shares of the Company. The 
voting rights attaching to the ordinary shares are set out in Clause 6.8 of the Company’s Constitution which states 
as follows:

“….at a general meeting, on a show of hands, every person present who is a member or a proxy, attorney or 
representative of a member has 1 vote; and on a poll, every person present who is a member or a proxy, attorney 
or representative of a member has 1 vote for each share the member holds and which entitles the member to vote, 
except for partly paid shares, each of which confers on a poll only a fraction of one vote equal to the proportion of 
the total amount paid and payable (excluding amounts credited) on the share which has been paid (not credited) on 
the share.”

ADDITIONAL SECURITIES EXCHANGE INFORMATION for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |Distribution of holders of equity securities 
The distribution of holder of equity securities on issue in the Company as at the Reporting Date is as follows:

73

Range

1 – 1,000

1,001 – 5,000

5,001 – 10,000

10,001 – 100,000

100,001 and over

Total

Performance rights

Range

1 – 1,000

1,001 – 5,000

5,001 – 10,000

10,001 – 100,000

100,001 and over

Total

Ordinary fully paid shares

Total holders

126

549

252

718

220

Units

22,872

1,603,046

2,009,777

25,668,431

247,068,916

1,865

276,393,042

% of issued 
capital

0.01

0.58

0.73

9.29

89.39

100

Performance rights

Holders of 
performance 
rights expiring 
1 December 2022

Holders of 
performance 
rights expiring 
1 December 2023

Holders of 
performance 
rights expiring 
1 December 2024

–

–

–

–

3

3

–

–

–

–

6

6

–

–

–

2

10

12

Unmarketable parcels
The number of holders of less than a marketable parcel of ordinary shares based on the closing market price as at 
the Reporting Date is as follows:

Unmarketable parcels as at reporting date

Minimum 
parcel size

Holders

Minimum $500 parcel at $0.3000 per unit

1,667

241

Units

187,816

2022 ANNUAL REPORT | GALE PACIFIC |74

Substantial shareholders 
As at the Reporting Date, the names of the substantial holders of Gale Pacific and the number of equity securities 
in which those substantial holders and their associates have a relevant interest, as disclosed in substantial holding 
notices given to Gale Pacific, are as follows:

Class of equity securities

Thorney Holdings Proprietary Limited

Windhager Holding AG

Castle Point Funds Management

No. of ordinary 
fully paid 
shares

78,800,399

44,358,481

17,131,603

%

28.61

16.05

6.22

Twenty largest holders of quoted equity securities 
The Company only has one class of quoted securities, being ordinary shares. The names of the 20 largest holders 
of ordinary shares, and the number of ordinary shares and percentage of capital held by each holder is as follows:

Shareholder

THORNEY HOLDINGS PTY LTD

WINDHAGER HOLDING AG

NATIONAL NOMINEES LIMITED

ARD CORPORATION PTY LTD 

UBS NOMINEES PTY LTD

BOND STREET CUSTODIANS LIMITED

CONTEMPLATOR PTY LTD 

BFA SUPER PTY LTD 

BNP PARIBAS NOMS PTY LTD 

BNP PARIBAS NOMS (NZ) LTD 

STITCHING PTY LTD 

CERTANE CT PTY LTD 

CHILLEN PTY LIMITED (TALLEN)

MR NICHOLAS BARRY DEBENHAM & MRS ANNETTE CECILIA DEBENHAM  


NCH PTY LTD

RATHVALE PTY LIMITED

MR NICHOLAS BARRY DEBENHAM & MRS ANNETTE CECILIA DEBENHAM  


VENN MILNER SUPERANNUATION PTY LTD

CERTANE CT PTY LTD 

JFT INVESTMENTS PTY LTD 

TOTAL: TOP 20 HOLDERS OF ORDINARY FULLY PAID SHARES AS  
AT REPORTING DATE

No.

71,984,262

44,358,481

17,580,858

7,447,074

6,816,137

4,500,000

3,950,000

3,327,428

3,121,162

2,980,624

2,700,000

2,448,043

2,431,317

1,962,718

1,900,433

1,857,200

1,762,718

1,750,000

1,694,000

1,500,000

%

26.04

16.05

6.36

2.69

2.47

1.63

1.43

1.20

1.13

1.08

0.98

0.89

0.88

0.71

0.69

0.67

0.64

0.3

0.61

0.54

191,309,737

69.22

Voluntary escrow
There are no securities on issue in Gale Pacific that are subject to voluntary escrow. 

ADDITIONAL SECURITIES EXCHANGE INFORMATION (continued) for the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |75

Unquoted equity securities
The number of each class of unquoted equity securities on issue, and the number of their holders, are as follows:

Class of equity securities

Performance Rights

Number of 
unquoted equity 
securities

Number of 
holders

18,980,338

23

There are no persons who hold 20% or more of equity securities in each unquoted class other than under an 
employee incentive scheme.

On market buyback
There is no current on-market buy-back program in place. 

Issues of securities
There are no issues of securities approved for the purposes of item 7 of section 611 of the Corporations Act which 
have not yet been completed.

Securities purchased on-market
No securities were purchased on-market during the reporting period under or for the purposes of an employee 
incentive scheme or to satisfy the entitlements of the holders of options or other rights to acquire securities granted 
under an employee incentive scheme. 

Stock exchange listing
Gale Pacific’s ordinary shares are quoted on the Australian Securities Exchange (ASX issuer code: GAP).

Other information
The name of the Company Secretary is Ms Sophie Karzis. The address of the principal registered office in Australia, 
and the principal administrative office is 145 Woodlands Drive, Braeside, 3195, Victoria, Australia, telephone is 
(03) 9518 3333. The Company is listed on the Australian Securities Exchange. The home exchange is Melbourne. 
Registers of securities are held by Computershare Investor Services Pty Limited, Yarra Falls, 452 Johnston Street, 
Abbotsford, Victoria, 3067, Australia, local call is 1300 850 505, international call is + 613 9415 4000.

2022 ANNUAL REPORT | GALE PACIFIC |76

GALE PACIFIC LIMITED
ABN 80 082 263 778

DIRECTORS

DAVID ALLMAN
Chairman

PETER LANDOS
Non Executive Director

DONNA MCMASTER
Non Executive Director

TOM STIANOS
Non Executive Director

JOHN PAUL MARCANTONIO
Chief Executive Officer & Managing Director

COMPANY SECRETARY
Sophie Karzis

REGISTERED OFFICE
145 Woodlands Drive, Braeside,
Victoria, 3195
+ 613 9518 3333

AUDITORS
Deloitte Touche Tohmatsu
477 Collins Street, Melbourne,
Victoria, 3000
+ 613 9671 7000

STOCK EXCHANGE LISTING
GALE Pacific Limited shares are listed on the Australian 
Securities Exchange (ASX code: GAP)

SHARE REGISTRY
Computershare
Yarra Falls, 452 Johnston Street,
Abbotsford, Victoria, 3067
+ 613 9415 4000

CORPORATE DIRECTORYfor the year ended 30 June 20222022 ANNUAL REPORT | GALE PACIFIC |